This story originally aired on Marketplace on Aug. 27.
Congress has authorized trillions of dollars in new spending through the Inflation Reduction Act, the CHIPS and Science Act and the Bipartisan Infrastructure Law. In our series “Breaking Ground,” Marketplace host Kai Ryssdal visits communities across the country to look at how this infusion of federal dollars might change the economy in complicated, invisible, even contradictory ways.
In the second episode of our broadband coverage, Ryssdal travels to Kentucky to explore how some of the $42 billion available through the Broadband Equity, Access, and Deployment program, or BEAD, is being invested.
Kentucky and broadband
The state of Kentucky was allotted $1.1 billion to get every home hooked up to high-speed internet. Currently, Kentucky has roughly 200,000 homes that are counted as unserved or underserved in regard to broadband, according to Meghan Sandfoss, executive director of the state's Office of Broadband Development.
"We get calls every day from people that are unconnected and are looking for a solution to not having high-speed internet," Sandfoss said. "And the best conversations that we have are the ones where we can tell them it's coming, and soon, but the hope is that, by the end of the BEAD program — and if we don't accomplish it, we have failed — is that we're going to connect everyone."
The funding process
One of the main obstacles states face in securing their BEAD funding and connecting every home is creating an accurate broadband map. The maps need to show every location, from houses to hospitals, that is broadband serviceable, as well as its current access status. To make these maps perfect, broadband offices rely on a challenge process. This offers an opportunity for internet service providers, or ISPs, as well as nonprofits and local governments, to chime in to help correct the data.
"We got, I think, over 400,000 challenges," said Sandfoss. "It's not the most that any state has seen, but it still sounds like a lot."
Once that map is as accurate as possible and the federal government has given its approval, broadband offices move to the subgrantee process. There are more than 2,000 ISPs in the United States, and they'll bid against one another to secure funding to complete broadband projects across the country.
But the process doesn't end there.
"You'll hear a lot about permitting struggles, pole attachments, environmental review, so there's a lot of work that goes on behind the scenes before you see the fiber on the utility hole," Sandfoss said.
The rollout
Part of what makes Kentucky an interesting case for broadband rollout is its challenging topography, with the Appalachian Mountains and forested hills, as well as the state's large rural population. About 20% of Americans live in rural areas, but in Kentucky, the proportion is double.
Ryssdal took a ride with Chip Spann, the National Telecommunications and Information Administration's program officer handling BEAD money for Kentucky and West Virginia, because a large part of Spann's role in the challenge process is getting the lay of the land.
Spann recounted that he's driven more than 10,000 miles around the two states. "It's difficult to do an engineering design from a desk 100 miles away," he said.
Beyond identifying unserved areas, Spann has more than 40 years of experience in the telecom world, and he can tell when laying fiber — the preferred method of broadband deployment for BEAD funding — isn't feasible, whether because of the area's logistical challenges or the remoteness of a house.
"When you're an internet service provider, one of the things that you're trying to account for is, for every mile of infrastructure that I have, I'm hoping that I at least pass a minimum 10 households or more," Spann said. If an ISP doesn't find that level of housing density in an area, it might not be able to generate a return on investment for a costly fiber deployment.
In rural areas, that investment in laying fiber-optic cables might be around $50,000 per mile, according to Spann. The economics are further complicated in areas with large Amish and Mennonite populations because ISPs aren't going to find paying customers in those households.
"That's the reason that in rural areas like we're in right now," Spann said, "the business model has just not panned out to date."
More from this series
Preview: Libraries are essential for internet access, even as national broadband projects ramp up
Part 1: The U.S. is investing billions of dollars in fiber internet. Here's what makes it run.
You can explore all of Marketplace’s Breaking Ground Coverage, which explores how federal dollars might change the economy in complicated, invisible, even contradictory ways.
