Has BEAD frozen over? What you need to know

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  • The White House wants to temporarily freeze federal grants – a move that would presumably impact the BEAD program
  • New Street Research saw this coming, as Republicans amp up the conversation around BEAD reform
  • Despite the pending freeze, there are states that likely already have some access to their BEAD money

As if there wasn’t enough confusion about the fate of the Broadband Equity, Access and Deployment (BEAD) program, President Donald Trump has called to freeze most federal grants and loans. Will Trump’s order leave state broadband plans in the cold? Maybe not, but conversations surrounding BEAD reform are poised to heat up.

Here’s what we know so far. The White House’s Office of Management and Budget (OMB) released a memo Monday directing agencies to pause all activity related to federal grant spending until February 10. Presumably, BEAD falls under that bucket.

According to the memo, the pause will give the administration time to “review agency programs and determine the best uses of the funding for those programs consistent with the law and the President’s priorities.”

The freeze was supposed to take effect Tuesday evening. However, a federal judge blocked the move until February 3, after some nonprofit groups filed a lawsuit against the order.

But the funding pause isn’t a big surprise – it’s something NTIA would have likely done itself while it awaits White House guidance on how to proceed with BEAD, said New Street Research Policy analyst Blair Levin.

Trump released a flurry of executive orders in his first few days in office, including one freezing new federal regs until new administrators are put into place and another ordering agencies to pause disbursement of funds from both the Inflation Reduction and Infrastructure Act and the Infrastructure Investment and Jobs Act.

The latter allocated money for BEAD, but the White House later clarified that EO only applies to certain energy projects.

This pending freeze on the other hand appears to have a wider scope.

“Approximately 95.5% of the funding still requires some level of approvals by [NTIA],” said Raymond James analyst Frank Louthan. “Those funds would appear to be held up by this executive order, and are unlikely to make additional progress should Trump’s order remain in place.”

Some of the BEAD money is already in state hands. Louisiana, Nevada and Delaware are the only ones so far to release their lists of grant winners, and it doesn’t seem likely Congress can pull that funding back, said Steve Schwerbel, state advocacy manager at WISPA.

But BEAD funding didn’t just go out the door to those three states, Schwerbel told Fierce. When states got their initial proposals approved, NTIA allowed them to request some portion of their BEAD allocation upfront.

“It’s a slightly gray area and I’m not sure whose bank accounts those dollars are sitting in right now,” he said.

Those states may be waiting for permission to allocate their BEAD money, while others “are still waiting for that disbursement to actually hit their accounts.”

The nagging question is what happens post-freeze. The OMB memo “likely accelerates the debate we view as inevitable about the program,” Levin said in a note Tuesday.

Republicans call for BEAD reform

The U.S. Senate on Wednesday gathered for the confirmation hearing of Acting Secretary of Commerce Howard Lutnick, who was asked how he will ensure BEAD funds go to “truly unserved areas.”

Lutnick, who oversees NTIA and will likely name the new BEAD program administrator, said he wants to make sure Congress “gets the benefit of the bargain.”

“You want to get broadband in the hands of low-income people. Let’s go do it but let’s do it efficiently,” Lutnick said on the Senate floor. “Let’s use satellite, let’s use wireless and let’s use fiber. And let’s do it [in] the cheapest, most efficient way we can.”

Commerce committee chair Ted Cruz has made his dislike for the BEAD program pretty clear, particularly with the fiber preference. Rumor has it the next BEAD chief could be Arielle Roth, who currently works for Cruz as policy director of telecommunications. FCC Chair Brendan Carr has also expressed support for less focus on fiber, though he has no direct influence over the program.

Calls for reform aren’t just coming from the federal front. Last week, Louisiana Governor Jeff Landry sent a letter to Lutnick urging changes to BEAD that “would result in shovels on the ground quickly.”

Notably, Landry suggested NTIA eliminate the “alternative technology” category and reclassify low-earth orbit satellite and unlicensed fixed wireless as “reliable broadband.”

Other proposed reforms included getting rid of “unnecessary and/or punitive reporting obligations,” like requiring subgrantees to report the number of contracts and subcontracts awarded. Landry also suggested NTIA eliminate the federal letter of credit mandate, “so BEAD funds go to broadband deployment, not banks.”

Levin told Fierce he thinks Landry was creating a list that would align the most with Trump’s NTIA as well as with most state governors, “as it largely gives states more flexibility.”

Landry’s proposal is “a real ray of hope for some of our smallest members,” said Schwerbel. He noted the significance of Louisiana coming forth in support of non-fiber BEAD deployments, given the state probably had enough money to put fiber in “every single location.”

“They recognized that success in BEAD does not rest on the deployment phase,” Schwerbel said. “It rests on the ability to complete all of the program,” including non-deployment efforts like digital equity.

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