$160 million still available for broadband infrastructure subsidies in California

26 August 2014 by Steve Blum
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When the California Public Utilities Commission starts accepting applications for broadband infrastructure grants later this year, there will be something like $160 million available to hand out. That’s my estimate, based on the amount approved to date and expected administrative costs.

The overall cap on the California Advanced Services Fund is $315 million. Of that, $10 million is set aside for infrastructure loans, $10 million for regional consortia and $25 million for public housing projects. The remaining $270 million goes to the infrastructure grant account.

From the establishment of CASF in 2007 until now, the commission has approved $92 million in grants, not counting projects that were funded and then later canceled. Then there are administrative costs, which have been steadily rising as the CASF program grows and federal funding, particularly for broadband availability mapping, dries up.

As of the end of 2013, the running overhead total was $3.5 million. I don’t have hard figures, but based on previous cost allocations, a good, round guess is that $3 million is coming out of the grant account. Based on the CASF administrative budget approved last year, I estimated that from July of 2014 on, the total overhead hit to the grant account would be $10 million. Add in another $1 million for the first half of $2014, and the lifetime administrative bite out of CASF infrastructure grant funds is something like $14 million.

So, subtracting the $92 million in approved projects and $14 million for overhead leaves $164 million for future projects. I’m fudging a bit by pegging the range at $160 million – rounding down to allow for surprises – but that’s the range.

There are two grants still, technically, under consideration: the Bright Fiber FTTH project in Nevada County which is asking for $17 million and the $11 million ViaSat proposal. Given the CPUC’s decision to begin accepting new subsidy applications on a rolling basis in December, those two are effectively competing for the same pot of money. There might be a decision on the ViaSat proposal before the new window opens, but Bright Fiber is on hold for at least a year.

Another consideration is the proposal to kick in 10% of the cost of any approved FCC rural broadband experiment. But if California gets its share – 10% of the $100 million total, goes the argument – it would mean something like a million bucks, which doesn’t significantly change the round number estimate.