CCA warns up to $1B in RDOF funds could be wasted

The Competitive Carriers Association (CCA) warned the Federal Communications Commission (FCC) is about to misspend millions in federal broadband funds, sending money to locations where it isn’t actually needed, due to faulty coverage maps.

Specifically, CCA flagged money set to be distributed as part of Phase I of the FCC’s Rural Digital Opportunity Fund (RDOF) program. CCA CEO Steve Berry told Fierce the association knew from the start the coverage data the FCC used to determine eligibility for the program was “absolutely incorrect.”

“We knew the data was not accurate,” he said. “The FCC told Congress that ‘no, we’re absolutely certain that the first phase of this that we do, there won’t be any areas that have broadband coverage.’ Well, they were absolutely wrong. And now we’ve shown that not only were they wrong, but they were seriously wrong.”

The RDOF Phase I auction was held in late 2020 and aimed to push funding to census blocks across the U.S., which were entirely unserved by fixed broadband offering speeds of at least 25 Mbps down and 3 Mbps up. But in a letter and report sent to the FCC, CCA said spot checks of addresses within several census blocks set to receive funding showed “many of these areas have access to multiple, competing broadband service providers offering services in excess of 25/3 Mbps.” It used Ookla Speedtest measurements for the checks.

Rather than connecting the unconnected, CCA said funding provided to these areas “will subsidize broadband deployment in areas that obviously are served, including some of the nation’s wealthiest, most densely populated areas.” These locations include Fisherman’s Wharf in San Francisco, Apple headquarters, the Massachusetts Institute of Technology campus and several large airports including international hubs in Dallas-Forth Worth and San Francisco.

RELATED: Charter scores big in Phase I of the FCC's RDOF auction for rural broadband builds

All told, CCA estimated “funds for nearly 6% of all RDOF locations will be spent in some of the wealthiest, most populous parts of the country, where broadband infrastructure is significantly more likely to already exist.” It added that means the FCC could end up “improperly” distributing as much as $1 billion in RDOF money if it doesn’t change course.

Berry said CCA wants the FCC to not only acknowledge the mapping problem, but require companies that are set to receive funding in obviously served areas to amend their RDOF applications in an effort to prevent precious funding from being wasted.

Bad maps

The CEO told Fierce the problem of bad mapping data isn’t unique to RDOF. Indeed, CCA previously flagged issues with the coverage maps the FCC was originally planning to use to determine eligibility for its 5G Fund for Rural America. The Commission subsequently decided to redo its maps before allocating the funds.

However, with RDOF Phase I “we are making the same mistake that was made back in 2008, 2009, we’re repeating it in RDOF and that’s because we don’t know where we do or do not have broadband coverage,” Berry said, referencing earlier funding efforts including the Broadband Technology Opportunities Program (BTOP).

He warned bad maps could also hamper the effectiveness of additional targeted funding efforts, including a massive broadband spending program floated by President Joe Biden’s administration earlier this year.

“Here we are talking about going forward with a $100 billion program…but it comes down to the same granular issue and that is where are you going to spend the money most efficiently,” he said. “I just think this is proof positive that as we move forward with this new program we need to be very careful that we actually spend these resources the right way.”

A total of $9.2 billion was awarded in Phase I of the RDOF auction. An additional $11.2 billion is on the table in Phase II, which will target partially served areas and unserved areas that did not receive funding in Phase I.

Unlike Phase I, the second auction will use mapping data collected as part of the FCC’s Digital Opportunity Data Collection initiative (which will also be used for the aforementioned 5G Fund) to determine eligibility.

It is unclear what maps Biden would rely on for the $100 billion program.