Published: June 7, 2025
Detailed Report: NTIA BEAD Restructuring Policy Notice
The BEAD Program, created by the Infrastructure Investment and Jobs Act (IIJA) with a $42.45B budget, aims to connect all Americans to high-speed broadband. This Restructuring Policy Notice was issued to correct what NTIA deems burdensome and counterproductive requirements introduced by the previous administration’s NOFO (May 2022), which allegedly stalled deployment and increased costs. The goal is to ensure taxpayers receive the “Benefit of the Bargain” through expedited, competitive, and technology-neutral broadband deployment.
Key Policy Changes and Eliminations
Labor & Workforce Rules: DEI and labor-specific planning requirements removed.
Climate Change Provisions: Resilience and environmental impact mandates rescinded.
Open Access/Net Neutrality: This is no longer required; pricing and network management are left to providers.
Local Coordination: Demographic consultation mandates eliminated.
Non-Traditional Provider Preference: Political subdivisions no longer prioritized.
Middle-Class Affordability Plans: The requirement to create/manage such plans has been removed.
Low-Cost Service Option (LCSO):
Redefined using the FCC’s Lifeline Program criteria instead of the defunct ACP.
No NTIA-imposed pricing; providers propose their own compliant LCSO.
Core Changes: Deregulation and a New Competitive Framework
The revised policy eliminates several requirements previously imposed on grant applicants and state broadband offices:
Labor, Workforce, and DEI Mandates: Eliminated sections include those requiring equitable workforce development and contracting with minority- and women-owned firms.
Climate Resilience Provisions: The NTIA no longer requires climate or environmental planning beyond statutory resilience benchmarks.
Open Access and Rate Regulation: BEAD grantees are no longer restricted from implementing usage caps or required to conform to NTIA-modeled low-cost broadband rates.
In perhaps the most consequential change, technology neutrality has become a central tenet of the program. The NTIA has officially discarded the original fiber-preference hierarchy in favor of a performance-based approach.
Eligible Entities may not categorically exclude any given technology,” the notice declares, opening the door to terrestrial wireless, unlicensed fixed wireless (ULFW), and low Earth orbit (LEO) satellite providers that meet the statutory 100 Mbps down / 20 Mbps up speed and <100ms latency requirements.
Introducing the “Benefit of the Bargain Round”
Eligible Entities have 90 days from the date of the notice to comply with all obligations, including running the “Benefit of the Bargain” round, and submit their revised Final Proposal.
All previously approved Final Proposals are rescinded; states must submit corrections to their Initial Proposals within 30 days to comply with the new policy.
All states must now rescind prior subgrantee selections and conduct a fresh application round, known as the “Benefit of the Bargain Round.” This process mandates that all applicants compete under the revised, cost-focused criteria regardless of technology or prior participation.
Projects will be scored primarily on minimal BEAD program outlay per location, with secondary consideration for speed to deployment, network performance, and past selection status.
States must update eligible location lists to exclude locations already served by qualifying unlicensed fixed wireless or other funded networks and to include locations newly unserved due to provider defaults.
Community Anchor Institution (CAI) definitions are narrowed to statutory language.
Scrutiny of Costs and Rejection of Excessive Spending
NTIA has granted itself the authority to override state project selections if proposed costs are excessive. As cited in the notice, Nevada’s previously approved plans included 24 project areas with costs exceeding $100,000 per location, which the NTIA has now flagged as an unacceptable source.
States are urged to maintain rigorous cost controls, particularly in high-cost or remote areas, and must justify their selection of non-priority projects.
Non-Deployment Funding
All previously approved non-deployment activities are suspended pending further NTIA guidance. Only deployment-related costs are currently eligible for BEAD funding.
Updated Definitions and Compliance Requirements
The Low-Cost Service Option (LCSO) now requires providers to define their rates, subject to speed and eligibility constraints, aligned with the FCC Lifeline Program rather than the expired Affordable Connectivity Program (ACP).
ULFW providers must submit detailed technical documentation to verify their network reliability. Mitigation strategies such as beam forming, conservative link budgets, and non-line-of-sight capabilities are required for eligibility.
LEO providers must comply with a 10-year performance term, provide CPE at no cost, and meet milestone-based reimbursement conditions.
Administrative and Permitting Enhancements
To cut red tape, the NTIA mandates using its Environmental Screening and Permitting Tracking Tool (ESAPTT) to reduce environmental review timelines under the National Environmental Policy Act (NEPA) to just two weeks for most projects. All previous Final Proposal approvals are void, and states must submit revised proposals within 90 days, including a reclassification of serviceable locations and anchor institutions according to stricter definitions.
Letter of Credit Requirement
The LoC may be incrementally reduced based on service availability and take-rate milestones:
50% reduction when the provider certifies service availability to all locations in the project area.
An additional 25% reduction when the subscription rate reaches 25% of all locations.
Final closure of the LoC is permitted once 50% of locations are subscribed.
Example:
If the original LoC was $2,500:
After service availability: reduce to $1,250
After 25% take rate: reduce to $625
After a 50% take rate, LoC may be closed out entirely
Time-Based LoC Expiration
Regardless of take-rate performance, the LoC may be terminated four years from the certification date. After that, the provider can deliver service to any covered location within 10 business days of a customer request. This provision ensures LoC termination is not indefinitely tied to fluctuating take rates.
Purpose and Justification
The LoC framework is redesigned to encourage LEO providers to actively pursue customer adoption rather than merely reserving capacity. Since LEO services do not involve the same fixed infrastructure investments as terrestrial builds, NTIA recognizes the need for distinct accountability and incentive structures.
Relation to Funding Disbursement
LoC adjustments coincide with staggered reimbursement models. Eligible Entities may:
Pay in equal installments over 10 years,
Link payments to subscriber milestones, or
Advance up to 50% at specific benchmarks:
Upon certification of availability
Upon reaching 50% subscription in the area
Or a mix of both
| Trigger Event | LOC Action |
|---|---|
| Service availability certification | Reduce LoC by 50% |
| 25% subscription rate achieved | Reduce LoC by an additional 25% |
| 50% subscription rate achieved | LoC may be closed out |
| 4 years after certification (no conditions) | LoC may be terminated automatically |
Additional Notes
These LoC rules apply only to LEO Capacity Subgrants.
Subgrants must still meet all BEAD deployment and eligibility requirements.
The NTIA emphasizes consumer protection and fiscal oversight, mainly because LEO subgrants don’t involve fixed plant construction.
The LoC is separate from clawback or monitoring mechanisms, which remain in force for all subgrants.
PROS (Support for the Restructuring)
1. Accelerated Deployment
Pro: Eliminating burdensome administrative requirements (e.g., local coordination, climate planning, and DEI mandates) allows for faster project approvals and construction starts.
Benefit: This addresses a core criticism: that no BEAD projects had broken ground nearly three years after the IIJA passed.
2. Technology Neutrality
Pro: Permits fixed wireless, cable, and satellite technologies to compete alongside fiber.
Benefit: Promotes cost-effective and scalable options for rural and topographically challenging areas.
3. Focus on Cost Efficiency
Pro: New scoring rubric prioritizes the lowest BEAD cost per location, reducing waste and enhancing taxpayer value.
Benefit: States and providers are incentivized to build smarter, not more expensive.
4. Expanded Provider Participation
Pro: Removal of open access, net neutrality, and rate regulation lowers barriers to entry.
Benefit: Smaller ISPs, WISPs, and LEO operators can now viably compete for BEAD funds.
5. Revised LEO and ULFW Rules
Pro: Technical guidance and performance safeguards allow LEO satellite and unlicensed wireless providers to enter the market with accountability.
Benefit: Encourages innovation and flexibility in last-mile solutions.
6. Standardized Oversight via Letter of Credit
Pro: Incentive-based LoC reductions align financial assurance with actual subscriber adoption.
Benefit: Balances program oversight with reasonable risk tolerance for LEO projects.
CONS (Criticisms and Concerns)
1. Weakening of Equity and Workforce Goals
Con: Removal of DEI, local stakeholder consultation, and workforce development requirements reduces emphasis on inclusive growth.
Risk: Underserved communities may remain underrepresented in hiring and planning.
2. Risk of Inconsistent Quality
Con: Without strict fiber preference, some awarded technologies may offer inferior performance or longevity, especially in high-density or future-ready contexts.
Risk: Potential for digital inequality if cheaper but less capable networks dominate.
3. Disruption of State-Level Work
Con: Mandatory rescinding of prior subgrantee selections and Final Proposals forces states to restart selection processes.
Risk: Administrative burden, confusion, and further delays, especially in states that complied with the original NOFO.
4. Reduced Consumer Protections
Con: Eliminating open access and net neutrality rules could result in data caps, throttling, or limited wholesale options.
Risk: Consumers may face fewer choices, higher costs, or restrictive service terms.
5. Ambiguity on Non-Deployment Activities
Con: Suspension of funding for digital equity, planning, and technical assistance leaves a gap in a comprehensive broadband strategy.
Risk: Communities may be connected physically but left behind digitally and economically.
6. Centralization of Decision-Making
Con: NTIA retains final authority to override state decisions on what qualifies as “Priority Projects” or excessive cost.
Risk: Perceived as federal overreach into state broadband authority and planning discretion.
7. Limited Flexibility in Financial Assurance
Con: The Letter of Credit remains the only approved financial instrument, and alternatives such as performance bonds, escrow, or insurance mechanisms are not permitted.
Risk: This may exclude smaller or emerging providers, especially LEO or WISP operators, who struggle to secure high-value LoCs due to limited collateral or restrictive banking relationships. This would undermine competition and diversity in the provider ecosystem.
Just My Opinion
The NTIA BEAD Restructuring Policy Notice aims to make the program more cost-efficient, competitive, and quicker to deploy. However, it does this by stepping back from important aspects like equity, planning, and regulatory frameworks that support broader societal goals. While some appreciate these changes for their economic practicality, others express concerns that prioritizing speed shouldn’t compromise long-term digital equity, community involvement, or the quality of networks.
