- States have chosen to spend the majority of their Capital Projects Funds on high-speed broadband
- ISPs must finish their deployments by December 31, 2026
- States are spending their funds in different ways
Joseph Wender, director of the Capital Projects Fund, said at last week’s Broadband Nation Expo that the program has awarded all the states and territories their portion of the $10 billion fund, and the awardees have decided to spend $8 billion on broadband infrastructure projects.
The Capital Projects Fund was created as part of the American Rescue Plan Act (ARPA), which became law in March 2021. ARPA included a variety of programs to help Americans during and after the Covid crisis. The $10 billion Capital Projects Fund gave states funding for critical projects to enable work, education and healthcare in response to the public health crisis.
“The pandemic was truly the national teaching moment. Surely everybody now knows that broadband is essential,” Wender said.
Providing an update on the Capital Projects program last week, Wender said, “States have chosen to use $8 billion of the $10 billion for broadband. They report to us that when it’s done in 2026, over 2 million locations that previously did not enjoy high-speed broadband will have it as a result of our funds.”
Over $4 billion is already under contract in 37 states where service providers are beginning their deployments, he said.
The Capital Projects Fund requires awardees to provide broadband networks with speeds of 100 Gbps, symmetrical. Wender said the U.S. Department of the Treasury, which oversees the funds, wanted to mandate speeds that are future proof so that multiple people in the same household can use the internet at the same time without interruptions or buffering.
Different states are using their Capital Projects Funds differently. “What New York is doing is different than New Mexico,” he said. “And that makes good sense because the geography, the population are different. There is no perfect solution. I’m sure we’ll see this as well with BEAD.”
For instance, New York is spending its funds to improve broadband in multi-dwelling units (MDUs), which makes sense in a state with a lot of MDUs. Whereas, Vermont is focusing on the state’s municipal communications union districts (CUDs), which allow several towns to band together to provide high-speed internet services.
According to Pew Research, as of August, nearly $900 million has been awarded across 75 rural electric co-ops for 150 projects. And more than $520 million has been awarded across 84 different municipalities, which will use the funds for their own broadband networks or partner with a local ISP.
What’s next for Capital Projects?
Wender said the Treasury Department has approved all the plans and is now making sure “states stay on track” for their 2026 deadline.
“The foot must remain on the gas pedal,” he said.
Wender was asked what will happen to Capital Projects awardees who don’t complete their projects by December 2026. He said it would be risky to assume there will be an extension.
Finally, Treasury wants to make sure that all the locations served with the Capital Projects Fund are updated on the FCC’s national broadband map. “We are working very hard with states for quarterly reporting,” said Wender. “It must be coordinated with the NTIA, the FCC and the USDA.”
He said his team at Treasury talks to NTIA multiple times per week about the broadband maps. “The challenges that NTIA faces and that we face are quite similar,” he said. “There is intelligence that is shared between the two agencies.”
