In its brief, just-ended legislative session, the 92nd General Assembly authorized the creation of a program to provide grants for efforts to deliver broadband to rural areas.
The program follows the birth last year of a different initiative that also is intended to help grow broadband in rural areas. Arkansas lags in broadband access, a problem highlighted by the coronavirus pandemic, which forced students and many employees to do their work while staying at home.
The new program -- proposed by Sen. Missy Irvin, R-Mountain Home -- has spending authority of $2 million -- but no funding source -- in fiscal 2021, which starts July 1. It's part of the appropriation for the University of Arkansas for Medical Sciences; the program will be part of UAMS' Institute for Digital Health and Innovation.
"We will be working to get this funded," Irvin said Thursday. "It is a small investment that could reap millions of dollars for broadband deployment."
But Gov. Asa Hutchinson's spokeswoman, Katie Beck, said Friday that no funds have been allocated for Irvin's program and the funding source "is a future decision."
Act 139 of 2020 creates the Rural Broadband I.D. Expenses Trust Fund to be used for one-time grants to entities to defray expenses for broadband due-diligence business studies. Those studies would be done for prospective applicants for funding from federal broadband programs.
These federal programs include the Federal Communications Commission's Rural Digital Opportunity Fund program, the U.S. Department of Agriculture's Rural eConnectivity Pilot Program, the USDA's farm bill or other federal grants or loans for broadband development programs.
"I think this pandemic emphasizes the fact that we absolutely must have broadband infrastructure in place in our state," Irvin told the Legislature's Joint Budget Committee earlier this month.
"Arkansas' lack of rural broadband has been even more pronounced, given our current circumstances with both education challenges for K-12, higher ed online learning being conducted at home, and the lack of infrastructure to support some of those opportunities for patients and providers," she told the committee. The panel approved her eight-page amendment to UAMS' appropriation, which is now Act 139.
GOVERNOR'S INITIATIVE
According to the website broadbandnow.com, Arkansas ranks 41st in broadband access. The ranking is based on access to low-cost plans, wired networks and friendliness to competition, the website says. It says 77.7% of Arkansans have access to wired broadband speed of 25 megabits per second or faster, while 65.2% have access to broadband 100mbps or faster.
By comparison, in New Jersey, ranked No. 1 by broadbandnow.com, 99.1% of residents have access to both 25mbps and 100mbps speeds.
In August 2019, Hutchinson announced his own broadband plan, the Arkansas Rural Connect Broadband Grant Program. That $25 million plan was intended to get high-speed broadband service to rural communities.
In late August, the Legislative Council approved Hutchinson's request to transfer $5.7 million out of the state's restricted reserve fund to the Arkansas Economic Development Commission to provide startup funding for Arkansas Rural Connect.
The proposed rules for Arkansas Rural Connect cleared the Legislative Council in February, after the state's broadband office agreed to rework the program to make both counties and unincorporated communities eligible to co-apply for grants from the program.
Applicants for the grants may include cities, counties and unincorporated communities with internet service providers.
Communities are eligible if they have at least 500 people, at least 200 people who lack broadband coverage and no more than 80% of their population is served by broadband. Communities that do not meet the criteria can partner with other communities that do.
The grants would reimburse costs for broadband deployment, such as rental, depreciation and equipment costs; wages; and engineering costs.
Irvin's initiative with UAMS will be separate from the governor's broadband plan and funding dedicated for the latter, said Alisha Curtis, a spokeswoman for the state Department of Commerce.
The governor's office and the Commerce Department look forward to coordinating with UAMS on both initiatives, Curtis said.
The Economic Development Commission has a $250,000 contract with the UAMS institute to review 34 applications for the Rural Connect program from March 1 through the end of December, according to Bureau of Legislative Research records.
"We aren't taking [applications] yet but expect an announcement soon for applications," Curtis said.
Asked how much of the $5.7 million has been spent so far, she said that "we have not spent the funds yet."
COMPLEMENTARY EFFORTS
Irvin and Hutchinson agreed that the two programs complement each other.
Under Act 139, a local entity "means a county, including ... an unincorporated community within a county, a city of the first class, a city of the second class, and an incorporated town." Communities would partner with internet service providers and others to seek these grants to explore the efficacy of broadband in an area, Irvin said.
The rural broadband grants program would provide up to 30 grants with a maximum size of $75,000 apiece.
The grants will require the approval of either the Legislative Council or Joint Budget Committee.
Irvin said the grants program will provide assistance from UAMS, which has the ability and expertise to help with federal broadband grant applications and relationships already built with Congress.
The Institute for Digital Health and Innovation is one of UAMS' seven institutes. All of UAMS' telemedicine and digital health programs are organized under this institute, which is led by Curtis Lowery, said Leslie Taylor, a spokeswoman for UAMS.
In 2010, this group received a $102 million grant from the U.S. Department of Commerce to expand broadband to hospitals, colleges, libraries and other entities around the state, she noted.
The institute has 160 employees and an annual budget of $34 million, and is primarily funded through grants, contracts and patient care revenue, Taylor said. The institute won't charge an administrative fee to the rural broadband grants program to oversee it, she said.
Irvin said the program will focus "on using limited state funds to help facilitate applications for the federal funding for broadband.
"Given our current fiscal status, a program like this that focuses on leveraging, using state dollars to leverage the federal funding as much as possible, is really our best option and really what our need is in infrastructure," she said. "Local entities do not have this money budgeted and so this fund provides that catalyst to reach those federal funds."
Irvin said the rural broadband grants effort "really builds on the work" that Sen. Breanne Davis, R-Russellville, and Rep. DeAnn Vaught, R-Horatio passed in the 2019 regular legislative session.
"This was the intention and basically the implementation of that law," she said.
Act 198 of 2019 -- sponsored by Davis and Vaught -- ended the state's prohibition on municipalities providing broadband service. The law amended the Telecommunications Regulatory Reform Act of 2013 and allows government entities -- including cities, school districts and state agencies -- to provide broadband either on their own or in partnership with a private entity.
Rep. Stephen Meeks, R-Greenbrier, said he previously worked for a small internet service provider in Conway that spent hundreds of hours and lots of resources seeking federal grants to build out broadband. Unfortunately, he said, the provider was unsuccessful.
"This is going to allow us to partner with these small- and medium-sized businesses to be able to go after federal funds [and] provide for them the expertise that a lot of them simply just don't have," he said.
"The AT&Ts, the Comcasts, those are large corporations [that] have the people and the lawyers and the knowledge to be able to go after these large-scale federal grants," Meeks said. "But, unfortunately in the grand scheme of things, Arkansas is not something that is typically on the radar of a lot of these [corporations]. They have their local folks and so forth. But when you get out into the rural areas, there is not a lot of profit margin out there and, so in my mind, it's going to be the small- and medium-sized businesses ... that are going to solve this problem out to the very rural parts of our country."