Many state governments are rolling out aggressive broadband grant programs designed to incent ISPs to build out networks in rural, unserved, and underserved areas. These programs will complement existing federal funding programs. State broadband grant programs include:
- Ohio Residential Broadband Expansion Grant Program: This program provides $250 million for broadband ISPs to construct networks in unserved and underserved areas of the state. The Ohio Department of Development released details of the program on August 6.
- Wisconsin Broadband Expansion Grant Program: The Wisconsin Public Service Commission administers a $100 million grant program to build out broadband networks in unserved areas.
- Virginia Telecommunication Initiative: The Virginia Department of Housing and Community Development has provided $50 million of broadband funding in 2021. In addition, in July, Virginia's governor announced that $700 million received by the state under the federal American Rescue Plan will be invested in broadband infrastructure.
- California RDOF Kicker Fund: The California PUC's program provides additional funding (i.e., a “kicker”) to FCC Rural Digital Opportunity Fund (RDOF) auction winners building broadband networks in unserved California census blocks. The program offers RDOF winners up to 20 percent of the FCC RDOF auction reserve price for a given census block.
- Maryland Broadband Infrastructure Grant Funding Program: The Maryland Office of Statewide Broadband has provided grants totaling $49 million in 2021. These funds provide up to 50 percent of the capital construction costs associated with providing service to unserved rural homes and businesses. The funding round for 2021 is currently closed, but a new round of funding is expected for 2022.
- Nebraska Rural Broadband Remote Access Grant Program: In 2020, the Nebraska Department of Economic Development provided $29.5 million for rural broadband build out. In January 2021, Nebraska's governor proposed to provide grants of an additional $40 million for broadband infrastructure.
While most attention currently is on federal funding, including the FCC's $9 billion RDOF program and the $65 billion for broadband in the infrastructure bill being negotiated in Congress, state government funding programs are an important part of bridging the digital divide. As these programs ramp up funding to ISPs, their infrastructure partners will likely see a significant increase in demand in rural markets for towers, fiber, and related network buildout services and facilities.
In addition, state subsidy programs are poised to take a leading role under the infrastructure bill. That bill would allocate over $40 billion to the states for additional broadband infrastructure spending, with state programs providing subgrants to broadband ISPs for rural build-out.