Broadband Supporters Look to Next Steps After Release of Trump's Infrastructure Proposal

President Donald Trump’s infrastructure legislative proposal included its expected focus on streamlining the federal environmental permitting process, including for small-cells deployments, along with state block grants and federal matching funds (see 1801220035, 1802090050 and 1802110001). Communications sector officials and lobbyists bemoaned lack of a dedicated broadband funding allocation in the proposal, released Monday. They told us they are in the beginning phase of negotiations with the White House and Capitol Hill. The White House also released its FY 2019 budget plan, which seeks to zero out public broadcaster federal funding. The FCC's budget would also fall (see 1802120037).

The administration’s regulatory streamlining goals include a proposal that Congress amend current rules on National Environmental Policy Act (NEPA) and National Historic Preservation Act (NHPA) permitting reviews to “expedite” the process for “small cells and Wi-Fi attachments” without “adversely affecting the environment.” Small cells and Wi-Fi attachments “do not have an environmental footprint, nor do they disturb the environment or historical property,” the White House said. Making such projects go through the normal NEPA/NHPA process “needlessly adds both delays and costs to the process.”

Trump highlighted the proposal for a $50 billion allocation for rural infrastructure. “The rural folks have been left out, including broadband internet access, which they don't have,” Trump said Monday during a meeting with state and local leaders. “They want it, and the farmers want it. It will create thousands and thousands of jobs, and increase training.” It has “been very unfair what's happened with broadband” deployments in the Midwest and other rural areas, Trump said. “Now, it's going to be taken care of. We're spending a great deal of money on that. It's only fair.”

Trump “has offered us direction to meet infrastructure needs in our nation’s states, cities, and rural communities,” said Senate Commerce Committee Chairman John Thune, R-S.D., in a statement. “Aligning federal infrastructure funding with local priorities and looking at other impediments to building would increase accountability and help us meet our most critical infrastructure needs faster.” Trump “hit the nail on the head when constructing this plan to rebuild America’s infrastructure,” said House Commerce Committee Chairman Greg Walden, R-Ore., House Communications Subcommittee Chairman Marsha Blackburn, R-Tenn., and other committee leaders said in a joint statement. The committee has “been working hard to build out a legislative agenda that promotes broadband deployment,” among other priorities.

“We need to make real investments -- not cuts” to infrastructure spending, said Senate Commerce ranking member Bill Nelson, D-Fla., in a statement. “That’s why I plan to work with Chairman Thune and my colleagues [on the committee] to try to come up with a bill that can garner broad support and include ideas from both parties.” The proposal “is woefully inadequate for addressing the urgent needs of modernizing our nation’s infrastructure,” said House Commerce ranking member Frank Pallone, D-N.J., in a statement. “The proposal does not include any new funding, and it forces the majority of costs onto cash-strapped state and local governments.”

'Mixed Bag'

Trump’s comments are encouraging even though there's no dedicated broadband funding source, said NTCA CEO Shirley Bloomfield in an interview. The remarks also could bring additional visibility to the challenges rural broadband projects face, which could help the case for dedicated funding on the Hill. “We certainly think rural broadband has to have dedicated funding” to encourage further deployments, she said. There are concerns this could end up being a “food fight” between supporters of broadband projects and other infrastructure sectors for top priority as state governors decide how to allocate the expected rural block grants, Bloomfield said.

The plan is “a bit of a mixed bag” between lack of dedicated funding and the more encouraging focus on streamlining the permitting process, said Information Technology and Innovation Foundation Telecom Policy Director Doug Brake. “If we want to get serious about really addressing rural broadband, the idea of mixing it in [with other infrastructure projects] on a block grant basis means that future of rural broadband is not necessarily as bright as it otherwise could be.” Forcing governors to “choose between fixing bridges, fixing waterways” and other priorities means broadband will likely “not get the attention it deserves,” Brake said.

“I’m optimistic” about the Trump administration’s legislative package based mainly on the streamlining proposals, but “it’s going to be a hard sell” because of how the funding is structured, said one telecom lobbyist. The small-cells proposal exemplifies how the recommendations include “a lot of ideas but not a lot of specifics,” the lobbyist said: “That’s probably the right strategy since it gives Congress a lot of latitude” to shape final legislation. Another communications lobbyist also cited concerns about the lack of dedicated broadband funding and said the White House proposal is “just their opening offer.”

Some officials are already looking past House Commerce's work on broadband legislation and may begin concentrating on appealing to the leaders of the House and Senate Appropriations committees to make their case for a dedicated funding stream. House Commerce leaders weren’t enamored with mandating dedicated broadband funds during a recent House Communications hearing on a group of 25 broadband-related bills, two lobbyists said. Bloomfield highlighted Senate Appropriations Financial Services Subcommittee Chairman Shelley Moore Capito, R-W.Va., as a particularly sympathetic and powerful voice in favor of dedicated funding. Capito was among lawmakers who had written the administration to push for dedicated broadband funding (see 1801170054).

State Concerns

At NARUC's meeting Monday, officials welcomed bigger federal expenditures on broadband, saying details will determine whether the spending will help.

Idaho is a “net recipient” of USF dollars, Public Utilities Commission President Paul Kjellander told us. “I’m encouraged when we can see some federal money come through that doesn’t have too many strings attached to it, as opposed to just federal money thrown at something,” Kjellander said: “In the end, it depends on what the strings are.”

Boise, the state's largest city, has a just over 200,000 population, Kjellander said. “My entire state is rural, even though we have areas that are growing rapidly.” Rural health technologies could be “vital” in areas with few healthcare professionals, he said. “It’s a life changer,” he said of remote healthcare. “It’s more important than 911 in some instances.”

Infrastructure spending must be targeted to unserved areas, said Colorado PUC Commissioner Wendy Moser. Without rules and guidelines, the money will flow to areas that are more lucrative to serve, she told the panel. “That’s not where you need the infrastructure,” she said. “It’s a good idea to put money toward infrastructure, but it has to be targeted,” she told us. The West is “vast and wide open” and expensive to serve, she said. Asked about NTIA's earlier Broadband Technology Opportunities Program, Moser said “it didn’t hurt” and Colorado has made progress, but 6 percent of the state’s population still doesn’t have access to broadband.

The spending could be helpful as long as it's “carefully targeted and used to extend broadband where there is no service,” said Jonathan Banks, USTelecom senior vice president-law and policy, at the meeting. “We could make a big dent in the problem.”

Investors are very interested in the federal infrastructure spending legislation, but there are too many unknowns, Raymond James analyst Frank Louthan told NARUC. He asked how much of the spending will be actually focused on telecom. The big industry concern is overbuilding, he said. “There could be some additional investment, but I’m not sure it’s going to spur a whole lot."

Infrastructure is more likely to get built as a result of 5G than the infrastructure bill, said Wells Fargo’s Jennifer Fritzsche. The bill seems more focused on bridges than on broadband, she said. “It’s still very, very early days” and much is unknown, agreed Gregory Spencer of BlackRock Advisors.

Other NARUC news Monday: A draft backing Lifeline resellers advanced 1802120029 and ISP allies seek regulatory certainty amid some regular skepticism 1802120022.