How Can States Maximize Funding from the BEAD Program?

The Infrastructure Investment and Jobs Act (IIJA), passed in November 2021, created a new broadband grant program for the National Telecommunications and Information Administration (NTIA), a subdivision of the U.S. Department of Commerce. NTIA will grant states and territories $42.45 billion in funding, which can then be awarded to subgrantees for projects including the construction of new or extended broadband facilities in unserved or underserved areas. This grant program, called the Broadband Equity, Access, and Deployment (BEAD) program, is the largest federal infrastructure investment to date that is dedicated to closing the digital divide. NTIA will launch BEAD program rules in May, but states should start preparing now, as they have the key role of seeking this funding on behalf of constituents, awarding subgrants and managing the performance of all subgrantees.

By late 2022, the FCC plans to release geographically detailed broadband availability maps based on data collected from existing broadband providers this summer. States and other stakeholders will have the opportunity to challenge any mapping information that they view as inaccurate with self-collected “on the ground” information on broadband service gaps in their own area. If the information gathered in this process shows a state is appropriately “served” by high-speed broadband providers (versus “unserved” or “underserved”), that state could see less funding from the program.

This won’t be a simple process for states, as several critical activities are required to participate in the BEAD program, including:

• States must make sequential filings with NTIA to seek grant funding approval, each of which will require careful study and coordination with political subdivisions and other stakeholders.
• Once a state formally declares its intent to participate, it then must prepare an initial proposal by a filing deadline to be set by NTIA. NTIA will announce available amounts of funding for each state only after the FCC granular map data is available and the formula for distributing funding can be calculated.
• Each state can file a final proposal after NTIA approves a state’s initial proposal. States should be prepared to go through an iterative process with NTIA to solidify their specific proposed grant plans.

States will also need to create their own five-year plans addressing broadband investment priorities and associated costs, as well as describing how this planned spending will align with economic development, telehealth and connectivity efforts. States must coordinate with other political subdivisions during all phases of proposal development; NTIA will announce engagement metrics for this purpose. Additionally, each state has to develop a process for local governments or other stakeholders to challenge whether a particular location is deemed unserved or underserved. States then will provide public notice of their final classification of each unserved or underserved location and designate any eligible community anchor institutions for funding. Only then can the state receive its allocated funding and award funds to subgrantees.


In the initial proposal to NTIA, states are expected to lay out a framework for awarding subgrants. States need to ensure subgrantees are capable of meeting their commitment to the project, and contracts between states and subgrantees must include provisions to recover the grant funding in the event the project falls through. Subgrantees are required to contribute at least 25 percent of a project’s costs, except for projects in designated “high-cost” geographic areas. This contribution requirement can be waived by NTIA on a case-by-case basis.

A formal reporting program will require states to adopt specific accounting systems so information can be easily and accurately gathered — a key component, given the anticipated level of federal oversight and enforcement. As one example of this oversight, within 90 days of receiving a grant, a state must file a report identifying their intended compliance mechanisms, as well as costs and other information required by NTIA. These types of reports will be required every six months until a year after all state grant funds have been expended.

While most states have broadband offices, their role, staffing and responsibilities vary — so other agencies will be important stakeholders throughout this process. The scale of this undertaking and the scope of compliance management is unprecedented, and strategic planning for constructive engagement with state stakeholders and with NTIA will be essential. Analysis of issues such as the interplay between NTIA program rules, competitive bidding for subgrants, and state procurement and other laws will be key to successful navigation of the BEAD program. Another crucial factor will be the framing, methodology and presentation of each state’s five-year broadband deployment and adoption plan, which will need to deal carefully with matters of technological neutrality and potential “over-building” of existing broadband providers.

States will have an unparalleled opportunity to access significant new grant funding to support new or enhanced broadband infrastructure through the new NTIA programs. To make the most of this opportunity, they — and counties, cities and other stakeholders — need to be prepared.

Laura Phillips is a partner at the law firm Faegre Drinker, where she is the deputy chair of the firm’s government and regulatory affairs practice group and leader of the telecommunications practice team. A United States Certified Privacy Professional (CIPP/US), Phillips is an authority on telecommunications infrastructure and privacy.