$20 million still available for California broadband subsidies

1 August 2017 by Steve Blum
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There’s about $20 million, plus or minus, left for broadband infrastructure grants in the California Advanced Services Fund (CASF), against pending proposals totalling $5.7 million. That’s without taking into account a possible top-up that’s under consideration in the California legislature, but which might also make spending it on anything other than minimal upgrades by Frontier Communications or AT&T virtually impossible.

Over the years, the California legislature has pumped $315 million into the kitty, with $270 million of that allocated to construction subsidies for broadband systems – middle and last mile – in areas that are either completely unserved or lack service at a minimum of 6 Mbps download and 1.5 Mbps upload speeds. The balance is budgeted for broadband facilities and programs in public housing, regional broadband consortia operations and a lightly used infrastructure loan account.

From the time the CASF program began in 2008 until today, the California Public Utilities Commission has approved grants totalling $225 million for broadband projects. That’s a net figure – it doesn’t include the $4.5 million for grants that were approved but later rescinded, primarily because the projects didn’t happen.

The CPUC also pays for its own overhead out of the infrastructure grant fund, with $15 million either spent or budgeted through the middle of next year. Currently, the annual overhead hit is just north of $3 million. There’s at least four or five more years of administrative oversight required, but as the work shifts from reviewing applications to managing project grants, that yearly figure will probably come down. So to keep the numbers round and on the conservative side, let’s say another $10 million will be needed for CPUC overhead, for a total of $25 million.

That leaves $20 million still available for broadband construction grants. There are four project proposals currently under review – Kennedy Meadows in Tulare County ($2.3 million), Connect Anza Phase 2 in Riverside County ($2.2 million), Las Cumbres in Santa Cruz County ($730,000) and Vandyland in Santa Barbara County ($460,000) – that total $5.7 million.

I’m not betting all of them will be approved as proposed, but any way you look at it, there’s somewhere between $15 million and $20 million in the CASF broadband infrastructure grant program that hasn’t been spoken for. That’s enough for a couple of mid-sized, middle mile projects, one big new fiber to the home build, or maybe even a dozen or so smaller upgrade proposals. But only if California lawmakers don’t turn CASF into a private piggy bank for AT&T and Frontier.