Kentucky ramps up broadband investment

Published 10:20 am Thursday, September 14, 2023

In 2017, Kentucky ranked 47th in the nation in broadband speed and capacity. For the past several years, state legislators, agencies and other groups have worked to get the commonwealth up to speed.

Development of broadband, or high-speed internet, has become a key Kentucky issue, particularly in rural areas.

It’s also turned into a major point of Gov. Andy Beshear’s reelection campaign, alongside other infrastructure investments during his tenure.

So, what should Kentuckians know about the status of broadband development and deployment heading into a November election and 2024 legislative session?

The Broadband Deployment Fund

Earlier this month, Beshear announced 56 grants totaling $196 million as part of the second round of Broadband Deployment Fund awards.

The awards will fund last-mile projects bringing broadband to over 42,000 previously unserved or underserved homes and businesses.

The first round of awards, announced in June 2022, allocated $89.1 million for 34,000 previously unserved or underserved homes and businesses. At the time, it was the state’s largest broadband investment in history.

“High-speed internet is not a luxury anymore,” Beshear said at the announcement. “It’s a necessity for work, school, health care and more, and every Kentuckian deserves access.”

However, the Broadband Development Fund did not start with Beshear, but rather with the state legislature.

During the 2020 General Assembly, Rep. Phil Pratt, R-Georgetown, sponsored a bill establishing the fund.

Under the bill, the fund would pay for up to half of broadband projects, while grant applicants would have to raise at least half using local government or private matching funds.

This means that there will be at least a $600 million investment in broadband development through the program.

In 2020, the Kentucky state legislature created a broadband deployment fund to introduce or improve high-speed internet infrastructure in underserved and unserved areas.

In 2021, the legislature allocated $300 million in federal American Rescue Plan Act funds to the state broadband fund through a pair of bills sponsored by Reps. Brandon Reed, R-Hodgenville, and Richard Heath, R-Mayfield.

Reed’s bill also gave electric cooperatives the opportunity to offer broadband service through an affiliate company, something most were not allowed to do before.

Legislators said that this allowed regions underserved by their current broadband providers to have another option.

“Some of our areas have three to four homes per mile, and those areas will never be enticing to those large communications companies to service,” House Speaker Pro Temp David Meade said at the time.

In 2022, the final legislative piece of the puzzle came into place with House Bill 315, which created the Office of Broadband Development.

The office is in charge of administering the Broadband Deployment Fund, developing a statewide broadband plan and handling federal funding, among other responsibilities.

Who Got Funding, and Who Didn’t?

After the second round, 63 counties have received at least some funding through the Broadband Deployment Fund.

The 57 counties that haven’t been awarded are mostly concentrated in eastern Kentucky and along the Illinois and Indiana southern border.

According to the Office of Broadband Development’s five-year plan, one obstacle facing eastern Kentucky is its topography.

Running fiber in a mountainous, rugged terrain is costly, and many counties in the region are already economically distressed. Therefore, internet service providers are not incentivized to make an expensive investment to reach a few rural homes.

There is about $15 million remaining in the fund, but there have been no announcements about when a third round of grants might be awarded.

Among the second-round awardees, Harrison County was the biggest winner.

It is partnering with Spectrum Mid-America on a $31.8 million project to bring broadband to 2,557 unserved and 82 underserved homes and businesses.

The state provided $22.3 million of the budget. Harrison County Judge-Executive Jason Marshall said that they are now waiting on mapping and other information from Frankfort before taking the next steps.

“With limited broadband access in the county, it makes it hard for home-based businesses and students trying to do schoolwork from home,” Marshall said. “It’s just been a real challenge for those people in the rural part of the county that don’t have good connectivity to do the day-to-day business they need to do.”

Who Gets Credit?

Beshear’s celebratory statements about broadband investment have frustrated some Republican legislators who say they deserve the credit.

After Beshear’s second-round award announcement, House Speaker David Osbourne said that the historic investments would not have happened without Reps. Pratt, Meade and Reed.

“They recognized the need to expand broadband services throughout the commonwealth and drove the legislative initiatives that created and funded the Kentucky Broadband Deployment Fund and the Office of Broadband Development, despite the governor’s vetoing critical provisions of the plan,” Osbourne said in a statement.

“While today’s announcement is a step in the right direction, a great deal of work remains to be done before Kentuckians across the commonwealth have access to high-speed internet.”

Beshear line-item vetoed several provisions in the 2021 and 2022 broadband bills.

In the 2021 bill, he opposed a requirement to not spend more than $50 million of the $300 million before April 2022, saying that it would put Kentucky at a “competitive disadvantage” with other states also vying for limited fiber.

He also wanted to remove a priority order that required funds to go to underserved or unserved areas where other government funds are not available before other areas that may have some other limited funding.

In the 2022 bill, Beshear opposed the emergency clause provision. In his veto message, he wrote that the Public Service Commission might need more time than was allowed under an emergency clause to approve pending broadband projects.

Once state funding runs dry, Kentucky has another source to continue broadband development – this time from the federal government.

The 2021 Bipartisan Infrastructure Law included broadband money for each state through the Broadband Equity, Access and Deployment Program.

The program prioritizes areas with the slowest internet speeds, according to FCC maps that are currently being updated for accuracy.

BEAD includes a $1.086 billion allocation to Kentucky.

The state is currently working through the grant application process, and funds are expected to be distributed beginning in early 2024.