Last call for California broadband infrastructure subsidies

by Steve Blum • , ,

Drink up time.

The California Public Utilities Commission scrapped the tax that pays for the California Advanced Services Fund (CASF). The California legislature limited CASF to a total of $315 million, most of which goes to pay for broadband infrastructure projects. It’ll reach that limit by the end of next month, so the CPUC voted on Thursday to halt collection of the CASF surcharge – about half a percent – on telephone bills in California, effective 1 December 2016.

There’s still money in the kitty for infrastructure projects. How much depends on how much will be eaten up by the CPUC’s administrative overhead in the years ahead, and that’s difficult to predict. My original estimate was $10 million, but that number could go higher as time goes on. Assuming, though, that $10 million is still a good guess, then there’s about $119 million left. Coincidentally, there’s about $119 million in construction grant requests pending against that.

Not all of those will be funded. There are two competing projects proposed for the Phelan area in San Bernardino County. The price tags on those have been refigured – instead of one at $21 million and another at $48 million, both hover around $22 million, so regardless of which one is approved, about the same amount will go back into play.

That means there’s at least $20 million available right now that could be claimed by new proposals. If any of the other ten broadband infrastructure projects under consideration are denied, that number will go up. Since most of those are in the seven or even eight figure range, it could go up significantly.

The CASF program doesn’t run on a first come, first served basis, and a project proposed now could, in theory, be approved ahead of one submitted long ago. The window for new broadband infrastructure in under and unserved areas – those where either no Internet access is available at 6 Mbps download and 1.5 Mbps upload speeds or there’s no service at all – is still open. For at least a little while longer.