This article was produced by Stateline, an initiative of The Pew Charitable Trusts.
In 1936, roughly 90% of America’s urban areas had access to electricity, while roughly the same proportion of rural America was still in the dark. The Rural Electrification Act, signed that year as part of President Franklin Roosevelt’s New Deal, turned on the lights in isolated rural areas.
As the coronavirus pandemic lays bare America’s digital divide, some advocates argue that now is the time to make a big, bold investment in the country’s broadband infrastructure.
“If there was ever a moment to do the rural electrification of our time, this is it,” said Matt Dunne, executive director of the Center on Rural Innovation in Hartland, Vermont.
So far, some critics argue, federal aid to rural areas — and federal money for rural broadband in particular — has fallen short. The $2 trillion CARES Act, which Congress passed in late March, included money for states, big cities and large counties, but it did not directly funnel cash to communities with fewer than 500,000 residents.
Fourteen states, including hard-hit Iowa, Louisiana and Mississippi, have no urban or rural counties that qualified for those direct payments. And given the revenue losses to state budgets across the country, it’s unclear how much of the federal money states can afford to give to local governments.
Some states are considering using some of their CARES Act money to expand broadband to underserved areas. If their efforts are successful, rural areas will be among the biggest beneficiaries.
Broadband can be delivered through fiber, fixed wireless, digital subscriber line (DSL), or cable. Laying fiber is a major infrastructure project, and states that want to use CARES Act money to expand access may be thwarted by a federal requirement that the money be used by the end of the year.
In Vermont, which is one of the states considering using its federal aid to invest in broadband, it’ll take three months from the time the state receives the money and approves the necessary legislation to even choose a contractor, according to the Vermont Department of Public Service, which would oversee the project. It will take at least three years to complete the work.
According to the Federal Communications Commission (FCC), 22% of Americans in rural areas and 28% of Americans in tribal lands lack broadband coverage — as opposed to 1.5% of Americans in urban areas, a gap that’s narrowed since 2015. Overall, according to the FCC, 21 million Americans lack broadband access, though some experts say the FCC data vastly overestimates broadband connectivity. (The Pew Charitable Trusts, which funds Stateline, also supports a broadband research initiative.)
“In the past when there’s been an economic disruption like this, rural places have been an afterthought, and the repercussions of that we’re still dealing with today,” said Dunne, who founded the Center on Rural Innovation to address the rural economic crisis and opportunity gap as a result of the Great Recession.
“I’m hopeful that we can take a different approach as a country and make sure we have a strategy that is inclusive of all of America,” he said.
To be sure, federal and state investments approved before the pandemic are helping to narrow the digital divide. In October, the FCC will launch the $20.4 billion Rural Digital Opportunity Fund. The first phase of the plan will focus on more than six million homes and businesses in census blocks with little or no internet access.
Even the CARES Act includes $100 million for a U.S. Department of Agriculture (USDA) rural broadband program and $25 million for another program focused on distance learning and telemedicine for rural residents. But that sum represents only a tiny portion — a fraction of a percent — of the stimulus package.
Critics say the USDA funding will help address immediate short-term needs, such as putting WiFi repeaters on library buildings or on top of silos but isn’t enough to ensure rural America has the same broadband access that cities do.
“It felt very tokenized reading these bills,” said Olugbenga Ajilore, a senior economist at the Center for American Progress who studies rural America. “‘Let’s do rural; let’s do health care, broadband.’”
Instead, Ajilore said, policymakers should have asked, “What do they really need? What’s going to help them out?”
Congress is debating additional installments to the CARES Act that could include investments in small businesses, hospitals and infrastructure, additional cash payments to individuals and money for local governments.
House Democrats on the Rural Broadband Task Force and the Energy and Commerce Committee also have introduced a plan that would include investing $80 billion over five years to deploy broadband to underserved areas. That’s 640 times as much as was allocated in the CARES Act.
The CARES Act gives each state a minimum of $1.25 billion. In total, the measure sends $139 billion to states and localities with populations greater than 500,000. Smaller, rural communities have to wait for the state to send them a share of that money.
In Alabama, education and medical needs emerged as key crisis areas during the pandemic, said Republican state Sen. Del Marsh. As schools and doctor’s offices transitioned to virtual learning and telemedicine, only students and patients with computers and reliable internet connections could benefit.
“Had we had a high-speed internet system in place in the state of Alabama, our kids would still be receiving an education in these conditions,” Marsh said.
Marsh has proposed using $800 million of Alabama’s roughly $1.78 billion CARES Act allocation to address the state’s broadband infrastructure and equipment needs. Work would include laying fiber across the state as well as ensuring children have devices that they can take home for online learning.
“I can’t think of anything else that would benefit literally the entire state,” Marsh said.
If successful, the investment will follow the $9.5 million in broadband expansion grants Republican Gov. Kay Ivey awarded in late March. The grants are going to nine broadband providers to pay for projects reaching 13,000 customers in their coverage areas over the next two years, but Alabama hasn’t defined a goal for statewide coverage.
The state is hiring a consulting firm to provide accurate figures on where residents lack high-speed internet, according to Jim Plott, a spokesperson for the Alabama Department of Economic and Community Affairs. “Until that survey/map is completed to give us an accurate picture,” Plott said in an email, “it would be premature to establish a goal.”
Vermont has gone even further. The Vermont Department of Public Service produced an Emergency Broadband Action Plan to provide residents with universal broadband service using a chunk of the state’s $1.25 billion CARES Act allocation. The cost is expected to range from $85 million to $293 million, depending on how funds are disbursed to auction winners, and whether additional grants and awards are included.
“The pandemic has presented the need to have a plan in sharper focus,” said Clay Purvis, director of the state’s telecommunications and connectivity division. “There is money coming down the pike. What if you could spend it on broadband? How would you do it?”
About 77% of Vermont has internet service that meets or exceeds the federal definition of reliable broadband, which is 25 megabits per second (Mbps) download and 3 Mbps upload, (known in shorthand as 25-3), Purvis said. The emergency plan would exclude urban and suburban areas.
Since it will take several years to build out broadband, states are seeking clarification on whether they can put their federal aid in a dedicated pool they can draw from over time.
“I don’t know that anyone expects the pandemic to be over by the end of December,” Purvis said.