RDOF defaulters hinder state BEAD programs

  • Locations covered by RDOF aren’t eligible for BEAD

  • But some RDOF winners continue to default

  • State broadband officers are worried

There’s a lot of talk about how the Rural Digital Opportunity Fund (RDOF) might make a mess of things with the Broadband Equity, Access & Deployment (BEAD) program. That’s because if a location is covered by an RDOF award, then it’s ineligible for a BEAD grant.

Unfortunately, many RDOF awardees have officially defaulted on their obligations to build fiber, or they just haven’t made any progress in deploying the fiber. As a result, the locations that were supposed to be covered by RDOF could be left empty-handed.

On December 20, 2023, the FCC said that it had completed all the RDOF long-form application reviews, and it published a final list of 379 recipients with winning bids totaling more than $6 billion to be paid over 10 years. The FCC published this list after a lengthy process in which several high-profile recipients such as SpaceX’s Starlink were denied funds and in which numerous companies defaulted on their RDOF bids in certain locations.

But even though the FCC has reviewed RDOF defaults and set fines, some RDOF recipients may still default.

On March 4, Arkansas State Broadband Director Glen Howie sent a letter to all the RDOF winners in his state. He asked them to confirm their commitments under RDOF or let the state know if they “intend to surrender or default at any time in the future.”

Fierce spoke with Howie who said he was “being preemptive” with his letter. He said, “From a state broadband office perspective and given the history of broadband grant programs in general, there are any number of variables that can impact and cause them not to complete their builds.”

Brandy Reitter, executive director of the Colorado Broadband Office, said RDOF winners can default at any point during the period of performance. “We’re not going to be done with defaults until the program is finished,” she said.

The FCC originally awarded RDOF funds to seven awardees in Colorado for a total of $86.9 million. But already, two awardees have defaulted. Originally, about 40,000 households were supposed to be connected via RDOF, and now that’s down to 28,788 locations.

Asked if she is concerned about RDOF defaults interfering with the BEAD program, Reitter said, “Yes, we’re pretty concerned about it.”

She would like the federal agencies such as the FCC and the NTIA to address the RDOF defaults. “I think the solution lies with the feds because the states can’t do anything because these are federal programs.”