The American Recovery and Reinvestment Act (ARRA, P.L. 111-5 ) provided $7.2 billion primarily for broadband grant and loan programs to be administered by two separate agencies: the National Telecommunications and Information Administration (NTIA) of the Department of Commerce (DOC) and the Rural Utilities Service (RUS) of the U.S. Department of Agriculture (USDA). The ARRA directed broadband grant and loan funding in the following way: $4.35 billion to NTIA/DOC for a competitive broadband grant program including broadband infrastructure grants, competitive grants for expanding public computer capacity, and grants to encourage sustainable adoption of broadband service. The NTIA grant program is called the Broadband Technology Opportunity Program (BTOP). $2.5 billion to RUS/USDA for broadband grants, loans, and loan/grant combinations. The law states that 75% of the area to be served by an eligible project must be a rural area. A rural area is defined as any area not located within a city, town, or incorporated area that has a population of greater than 20,000 inhabitants; or not located within an urbanized area contiguous and adjacent to a city or town that has a population of greater than 50,000 inhabitants. The RUS broadband grant and loan program is called the Broadband Initiatives Program (BIP). Subsequently, P.L. 111-226 (the education jobs and Medicaid funding bill), signed into law on August 10, 2010, rescinded $302 million of unobligated BTOP money from NTIA. There were two rounds of ARRA broadband funding. The first funding round was announced with the release of a Notice of Funds Availability (NOFA) on July 1, 2009. The second funding round NOFAs were released on January 15, 2010. The ARRA mandated that all funding be obligated and awarded by September 30, 2010. As of October 1, 2010, all ARRA broadband funds have been awarded. This report focuses on the distribution of ARRA broadband funding. The following presents a breakdown of applications and awards data as of October 1, 2010. The first funding round was announced with the release of a Notice of Funds Availability (NOFA) on July 1, 2009. Broadband grants and loans fell into several first round project categories. For BTOP, projects could be: last mile , defined as any broadband infrastructure project the predominant purpose of which is to provide broadband service to end users; middle mile , defined as a broadband infrastructure project that does not predominantly provide broadband service to end users and may include interoffice transport, backhaul, Internet connectivity, or special access (up to $1.2 billion in grants available for infrastructure consisting of last mile and middle mile projects); public computer centers , which provide broadband access to the general public or a specific vulnerable population (up to $50 million in grants available); or sustainable broadband adoption , which demonstrate a sustainable increase in demand for and subscribership to broadband services (up to $150 million in grants available). For BIP, projects could be: last mile remote area , where "remote area" is a rural unserved area at least 50 miles from a nonrural area (up to $400 million in grants available); last mile nonremote area (up to $800 million in loans and loan/grant combinations available); or middle mile (up to $800 million in loans and loan/grant combinations available). On September 9, 2009, NTIA and RUS released data on applications received during the first round application period. In total, over 2,200 applications requested nearly $28 billion in funding for proposed projects reaching all 50 states, five territories, and the District of Columbia. The total amount of federal funding requested was seven times the amount available in the first funding round. Table 1 provides a breakdown of first round applications data with respect to program and project category. On January 15, 2010, NTIA and RUS released NOFAs announcing the second and final round of ARRA broadband funding. A total of $4.8 billion was made available, consisting of $2.6 billion for BTOP and $2.2 billion for BIP. Based on the agencies' experiences with the first round, and drawing on public comments collected from a November 16, 2009, Joint Request for Information (RFI), both NTIA and RUS streamlined the application process and made significant changes to how the second round of BTOP and BIP would be structured and conducted. Highlights included the following: Unlike the first round, each agency had its own separate NOFA, and applicants had the option of applying to either BTOP or BIP, but not to both. NTIA/BTOP primarily focused on middle mile broadband infrastructure projects, while RUS/BIP focused primarily on last mile projects. BTOP reoriented its infrastructure program towards Comprehensive Community Infrastructure (CCI) grants, which support middle mile projects serving anchor institutions such as community colleges, libraries, hospitals, universities, and public safety institutions. BIP eliminated the "Remote Last Mile" project category, and offered a standard grant/loan combination (75% grant/25% loan) for all last mile and middle mile projects (unless waivers were sought). The first round requirement that eligible infrastructure projects must cover "unserved" or "underserved" areas was eliminated. In the second round, BIP projects were required to cover an area that is at least 75% rural and that does not have High Speed Access broadband service at the rate of 5 Mbps (upstream and downstream combined) in at least 50% of its area. Eligible BTOP projects required only an applicant that is an eligible entity, a fully completed application, and a nonfederal match of 20% or more. However, during the application evaluation, factors such as unserved and underserved areas, remoteness, and delivered speed were considered. BIP added three new grant programs: Satellite Projects, Rural Library Broadband, and Technical Assistance. RUS published a separate Request for Proposals for each of these programs. On April 7, 2010, NTIA announced it had received 867 applications for second round funding, totaling $11 billion in requested federal funding. The applications broke down as follows: 355 applications requesting a total of $8.4 billion for Comprehensive Community Infrastructure, 251 applications requesting $1.7 billion for Sustainable Broadband Adoption, and 261 applications requesting $0.922 billion for Public Computer Centers. On April 16, 2010, RUS announced it had received a total of 776 applications requesting nearly $11.2 billion in federal funds. Of that total, RUS received 30 middle mile applications requesting a total of $845.88 million. Combined, NTIA and RUS received 1643 applications in the second round, requesting a total of $22.2 billion in federal funds. This is 26% less than the number of applications received by both agencies in the first round, and 21% less than the amount of federal funding requested in the first round. Additionally, on August 30, 2010, RUS announced it received 27 applications for Satellite Projects, 51 applications for Technical Assistance, and 2 applications for Rural Library Broadband. As of October 1, 2010, all BTOP and BIP award announcements were complete. In total, NTIA and RUS announced awards for 553 projects, constituting $7.5 billion in federal funding. This included 233 BTOP projects (totaling $3.9 billion) and 320 BIP projects (totaling $3.6 billion). Of the $7.5 billion total announced, $6.2 billion was grant funding, and $1.3 billion was loan funding. The following is a breakdown of awards data by project category and program, broadband technology deployed, and state-by-state distribution of funding. Awards data are derived from NTIA and RUS press releases, BTOP project information, the BIP Round Two Application Directory, BIP awards reporting publications, and the Broadband USA applications database. Table 2 and Table 3 provide breakdowns of awards data by project category and program. Of all broadband infrastructure funding, about half (51%) was awarded to middle mile projects (includes Comprehensive Community Initiative and public safety grants), and 49% was awarded to last mile projects (includes satellite grants). Middle mile projects are predominantly (but not exclusively) BTOP, while last mile projects are predominantly BIP. Given that only BIP offered loan funding, it is not surprising that the vast majority of loan funding (93%) was awarded to last mile projects. Deployment of broadband infrastructure can encompass a number of different types of technologies, including fiber, wireless, cable modem, DSL, satellite, and others. Table 4 shows that of all infrastructure projects funded, 56% are fiber projects. Additionally, given that most of the projects involving multiple technologies involve a deployment of both fiber and wireless technologies, it would be accurate to state that projects involving fiber account for about two-thirds of all infrastructure projects. Of last mile project technologies, 47% are fiber, 23% are DSL, 17% are wireless, 6% are multiple, 3% are cable modem, 1% are satellite, and the rest were unable to be determined from the public information that was released. Table A-1 in the Appendix shows a state-by-state breakdown of BTOP and BIP funding, while Table A-2 shows per capita funding by state. Funding is associated with a state based on the service area covered by the project. For BTOP grants, amounts shown may include the NTIA-estimated per-State share of any awards that impact multiple states. Table A-3 lists both NTIA and RUS multistate awards. With the broadband awards process concluded, NTIA and RUS move towards monitoring and overseeing the progression of the funded projects. Projects must be substantially completed within two years and fully completed within three years. In its FY2011 budget proposal, the Administration requested $23.7 million for NTIA to continue operating its grant management office. The Continuing Appropriations and Surface Transportation Extension Act, 2011 ( P.L. 111-322 ), which funds the federal government through March 4, 2011, includes a $20 million addition to the Salaries and Expenses account which can be used for BTOP oversight. Meanwhile, NTIA has awarded a $5 million, four-year contract to Potomac, MD-based ASR Analytics to measure the impact of BTOP grants on broadband availability, adoption, and on economic and social conditions in areas served by grantees. Funding for the award was obtained through the Department of Interior's National Business Center. The 112 th Congress is likely to provide oversight on NTIA and RUS efforts to monitor the funded projects. In the longer term, the FCC's National Broadband Plan has recommended an expansion of federal funding for broadband deployment in unserved areas. To the extent that Congress may consider whether broadband grant and loan programs should be continued, modified, reduced, expanded, or eliminated, the funding patterns and trends that emerged during rounds one and two, as well as the ultimate successes and failures of funded BTOP and BIP projects, could provide insights into whether and how such programs might be addressed, and how these or similar programs might be fashioned within the context of a national broadband policy.

Summary:
The American Recovery and Reinvestment Act (ARRA, P.L. 111-5) provided $7.2 billion primarily for broadband grant and loan programs to be administered by two separate agencies: the National Telecommunications and Information Administration (NTIA) of the Department of Commerce (DOC) and the Rural Utilities Service (RUS) of the U.S. Department of Agriculture (USDA). The NTIA grant program is called the Broadband Technology Opportunity Program (BTOP). The RUS broadband grant and loan program is called the Broadband Initiatives Program (BIP). As of October 1, 2010, all BTOP and BIP award announcements were complete. In total, NTIA and RUS announced awards for 553 projects, constituting $7.5 billion in federal funding. This included 233 BTOP projects (totaling $3.9 billion) and 320 BIP projects (totaling $3.6 billion). Of the $7.5 billion total announced, $6.2 billion was grant funding, and $1.3 billion was loan funding. This report focuses on the distribution of ARRA broadband funding with respect to project category, broadband infrastructure technology deployed, and state-by-state distribution. Of all broadband infrastructure funding, about half was awarded to middle mile projects and half was awarded to last mile projects. Deployment of broadband infrastructure can encompass a number of different types of technologies, including fiber, wireless, cable modem, DSL, satellite, and others. Projects involving fiber accounted for about two-thirds of all infrastructure projects. The 112th Congress is likely to provide oversight on NTIA and RUS efforts to monitor the funded projects. In the longer term, the FCC's National Broadband Plan has recommended an expansion of federal funding for broadband deployment in unserved areas. To the extent that Congress may consider whether broadband grant and loan programs should be continued, modified, reduced, expanded, or eliminated, the funding patterns and trends that emerged during rounds one and two, as well as the ultimate successes and failures of funded BTOP and BIP projects, could provide insights into whether and how such programs might be addressed, and how these or similar programs might be fashioned within the context of a national broadband policy.