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$20B in Federal Funds May Boost North Carolina Broadband

The FCC says it will use more accurate coverage maps as it disburses more than $20 billion of funds to increase broadband coverage in rural areas — potentially helping thousands in North Carolina.

FCC headquarters
(TNS) — The Federal Communications Commission says it will use more accurate coverage maps as it gets ready to disburse more than $20 billion worth of funds to increase broadband coverage in rural areas — potentially helping thousands of households and businesses in North Carolina.

However, a majority of the money, which comes from the FCC’s new Rural Digital Opportunity Fund, would be distributed using existing maps that overstate how many households in the country truly have access to high-speed, reliable broadband, according to rules proposed by FCC Chairman Ajit Pai.

Historically, the FCC has overstated how many households and businesses are able to access broadband because of how it defined access. The FCC has relied on internet service providers (ISPs) to self report which census blocks are served by broadband.

However, if just one home in a census block is served, then the entire census block is counted as served. Census blocks, which have hundreds or thousands of people in them, can vary drastically from each other. In size, they can range from a single square block in a city to hundreds of square miles in rural areas.

For example, according to the FCC, around 94% of North Carolina households have access to broadband. But state officials and advocates say, both anecdotally and empirically, that number is incorrect, The News & Observer previously reported.

Advocates have complained about that methodology, and the FCC said last year it would create more detailed maps. With more accurate maps, more areas could become eligible for federal and state dollars.

Closing broadband divide

But the first phase — and largest chunk — of the $20 billion Rural Digital Opportunity Fund won’t use those new maps. The first $16 billion of the fund will go to competing broadband providers who promise to extend service to the parts of the country that have no current access to high-speed broadband.

The FCC estimates that there are 6 million homes and businesses across the country that meet that definition. In North Carolina, that translates to an estimated 169,000 homes and businesses.

In the second phase, the FCC will use the new mapping process that will target census blocks that are only partially serviced by broadband providers, opening up potentially many more households and businesses to coverage. Those Phase 2 funds won’t be distributed until that mapping system is completed.

In a blog post, Pai said he wished to divide the fund into two phases, so the money would get distributed as quickly as possible.

“We don’t want millions of rural Americans to wait longer than necessary to obtain the economic, educational and health care opportunities provided by high-speed broadband,” he wrote.

The FCC said the new fund, which builds off a smaller fund that distributed $1.5 billion in 2018, is the largest effort to close the broadband divide.

“The digital divide affects many people in many rural communities,” Pai, the FCC chairman, said in a statement. “I’ve said that the Rural Digital Opportunity Fund would be our boldest step yet to bridge this divide, and today we get a glimpse of the broad impact this investment in rural America would have across the country. Our staff’s initial estimate shows that in 25 states, there would be more than 100,000 locations that would be eligible for Phase 1 of the fund.”

How fund will be distributed

The funds will be paid out over the next 10 years. The FCC will vote on Pai’s proposal on Jan. 30.

The money is expected to be distributed via an auction system, where broadband providers bid for certain locations. Providers that promise faster speeds will get priority. The standards for lowest acceptable speed have been raised from 10 megabits per second and 1 Mbps for uploads to 25 Mbps for downloads and 3 Mbps for uploads.

The auction for the first phase is expected to happen later this year. There’s no timeline yet for when the second phase will happen.

Christopher Chung, the CEO of the Economic Development Partnership of North Carolina, said the size of the FCC’s fund is great news because of how important broadband has become in rural economic development.

In North Carolina, 18% of households did not have an internet subscription in 2017, according to a report from the N.C. Technology Association. That was above the national average of 16.2%, and the state ranked 36th in the country on that metric.

“Residential broadband investment like what the FCC is announcing is important not just because it enables residents of rural communities to work remotely or start businesses that don’t depend on being in specific physical locations,” Chung said in an email, “but also because it’s increasingly critical for rural populations to access health care (i.e. telemedicine) and education resources (be it distance learning or just accessing the internet for schoolwork).”

©2020 The News & Observer (Raleigh, N.C.). Distributed by Tribune Content Agency, LLC.