Tennessee uses $400M of federal funds to boost broadband

Tennessee’s broadband deployment is getting a leg up with expanded funding from the American Rescue Plan (ARP). The Tennessee Department of Economic and Community Development (ECD) will award up to $400 million to service providers for broadband infrastructure projects.  

All entities authorized to provide broadband in the state are eligible to receive funding, said Taylre Beaty, state broadband director for the Tennessee ECD, at a Fiber Broadband Association webinar today.

The entities can be solely broadband providers to Tennessee, or they can include nationwide coverage.

ECD began accepting project applications in January, and broadband providers have until March 15 to submit applications for funding requests. Projects are expected to be completed within a three-year deadline. The additional funding has allowed ECD to remove its maximum request amount for grants, which was previously $2 million.

Broadband infrastructure projects are required to provide minimum speeds of 100/20 Mbps, in accordance with the U.S. Treasury’s Final Rule on ARP funding, which takes effect on April 1. The Final Rule also stipulates that grantees are now required to participate in the Federal Communication Commission’s (FCC’s) Affordable Connectivity Program (ACP), which provides discounted internet service to qualifying low-income households. 

Areas in Tennessee that have coverage below 25/3 Mbps and 10/1 Mbps, which are considered “severely underserved,” will be given priority for funding. 

“We recognize that 25/3 Mbps is not good internet,” said Beaty. “We want to make sure we are adapting to both technology and industry standards.” 

Tennessee kickstarted its plans for state broadband enhancement with the passage of the Tennessee Broadband Accessibility Act (TBAA) in 2017. TBAA’s goal was to provide grant funding over a three-year period to provide coverage in the state’s unserved and underserved areas.

In 2018, Tennessee received $10 million more in state funding, followed by $20 million in 2020 from the Coronavirus Aid, Relief, and Economic Security (CARES) Act. 

Tennessee was also among several states to receive a portion of a $119 million loan from the U.S. Department of Agriculture (USDA) in 2021. The USDA’s goal is to boost rural infrastructure projects. 

Under the Infrastructure Investment and Jobs Act (IIJA), which was signed into law last November, Tennessee will also receive a minimum of $100 million to help provide broadband access to about 420,000 residents who currently lack coverage.

“In the past three years, ECD has used both federal and state funding to make broadband service available to 140,000 Tennessee residents in 64 counties,” Beaty said. These 64 counties are currently designated as Broadband Ready Communities (BRC), areas that have enacted ordinances to facilitate the deployment of broadband.

ECD is also partnering with mapping vendor Connected Nation to create a detailed map of the state’s broadband coverage. The map will help ECD and state legislature make informed funding decisions. Beaty said that a drafted map will be available for public comment sometime this spring. 

“Broadband is a key driver for Tennessee’s economic development,” Beaty concluded. “We want to create an environment for long-term digital adoption and literacy.”