Legislature Passes Significant Broadband Funding and Policy Measures

May 24, 2022

A combination of state and federal funds for broadband deployment will help assist unserved and underserved cities.

The Legislature on May 22 advanced HF 3420, a drought-relief bill that also includes $210 million for broadband resources and policy provisions for broadband infrastructure deployment.

After a 66-1 vote by the Senate, the bill is on its way to Gov. Tim Walz.

Broadband funding

Broadband funding provisions in the bill include state general fund spending and legislative direction for federal broadband funding authorized by the American Rescue Plan Act and Infrastructure Investment and Jobs Act.

The following funding provisions were included:

  • $25 million in fiscal year (FY) 2023 and $25 million in FY 2024 in general fund spending directed to the state’s Border-to-Border Broadband Development Grant program, which provides 50% matching funds for broadband development costs for a qualifying project in unserved and underserved areas.
  • $60.703 million directed from the state’s share of the federal Capital Projects Fund authorized by the American Rescue Plan Act to be used for broadband grants under the Border-to-Border Broadband Development Grant program, with the remaining $50 million reserved for the Walz administration to spend on any other eligible expenditure within the program’s guidelines, including digital inclusion efforts.
  • All of the state’s appropriation of at least $100 million directed from the Broadband Equity, Access, and Deployment (BEAD) program, authorized by the Infrastructure Investment and Jobs Act, to be used for broadband infrastructure deployment under the Border-to-Border Broadband Development Grant program.

Broadband policy

Broadband policy provisions in the bill include:

  • Set aside of $10 million from the Border-to-Border Broadband Development Grant program funding and $30 million from the state’s BEAD grant share for a lower population density pilot program to provide broadband service in areas of the state where a 50% match formula is not adequate to make a business case for broadband infrastructure deployment and allows up to 75% of the total project cost to be covered by Border-to-Border broadband grant funds.
  • Set aside of $15 million for a new Broadband Line Extension Program, which would fund smaller-scale broadband line extensions to individual homes and businesses that still lack access.
  • Set aside of $15 million from the state’s BEAD grant share for comprehensive statewide broadband mapping efforts.

The additional resources for broadband deployment will set the state on track to address needs in the 8% of the state that still lacks access to reliable wireline broadband service.

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