Welcome to POLITICO’s West Wing Playbook, your guide to the people and power centers in the Biden administration. With help from producer Raymond Rapada. Send tips | Subscribe here | Email Eli | Email Lauren PROGRAMMING NOTE: We’ll be off for Thanksgiving this Thursday and Friday but back to our normal schedule on Monday, Nov. 27. This summer, President JOE BIDEN announced what he called a “big step” toward internet for all, rolling out a $42 billion investment to deliver broadband to unserved and underserved communities. “With this funding, along with other federal investments, we’re going to be able to connect every person in America to reliable high-speed Internet by 2030,” Biden said of the funds, allotted through his Bipartisan Infrastructure Law. But now, almost five months later, some broadband policy experts, advocates and progressives have been sounding the alarm that the program may not accomplish what the president proposed. One concern is that as private equity firms move into the broadband industry, they’ll position their providers to win the fresh round of government funding, squeezing out small and midsize bidders. “For President Biden’s ‘Internet for All’ dream to become a reality, we must ensure that onerous requirements do not crowd out competition for broadband dollars,” Biden ally Rev. AL SHARPTON wrote in an op-ed earlier this month. “If the only bidders remaining after these requirements are greedy and unscrupulous private equity firms, we should be very skeptical of their capacity to control access to the internet.” Advocates fear that the requirements to apply for funding through the Broadband Equity Access and Deployment Program — which is overseen by the National Telecommunications and Information Administration in the Commerce Department — will leave only private equity with the financial bona fides to meet them. The early tension points illustrate the typical, and challenging, growing pains that come along with implementing a plan of this scale. ACA Connects, an association representing more than 500 small and medium-sized communications companies, wrote a letter last month to Commerce, urging NTIA to provide better guidance on its vague “middle-class affordability” requirement that gives states a lot of leeway in defining these terms and determining how to manage prices. NTIA contends it’s following the statute set by the Bipartisan Infrastructure Law, which requires a low-cost option, and does not allow the agency to regulate rates, nor does the agency direct states to do so. “Ensuring that the networks we build are affordable for everyone in America — including working families — is a priority for President Biden,” an NTIA spokesperson said. But the most intense back-and-forth has been around the “letter of credit” mandate, which requires bidders to have enough cash in the bank or hard assets as collateral. The NTIA has already loosened requirements, allowing some alternatives such as performance bonds and for bidders to obtain a letter of credit from qualifying credit unions. But it’s still not clear whether this will be enough to help smaller internet service providers, said BRIAN VO, chief investment officer at Connect Humanity, an organization that invests in community connectivity providers for underserved communities. “I totally understand that we have to protect taxpayer dollars,” Vo said. But there’s also a risk of “crowding out or eliminating small community centered internet service providers, and many minority, women-owned businesses, from being able to participate.” The NTIA spokesperson said the agency believes in “robust participation” in the president’s “Internet for All” program — which is why NTIA adjusted the rules for the letter of credit requirement, “giving smaller providers more options to demonstrate financial capability.” As states prepare to dole out funding, some advocates are pushing the Biden administration to direct the money to publicly owned municipal broadband. FAIZ SHAKIR, the campaign manager for BERNIE SANDERS’ 2020 campaign, and his group, More Perfect Union, launched an email action campaign on the matter last month. If the funds instead go to big telecom and private equity players, advocates warn that Biden’s initiative may fail to reach underserved communities desperate for internet access. “They have to return their money back to their investors,” Vo said. “What we’re nervous about is, what’s the impact going to be on sustainability? Are they going to maintain the networks, especially in low-income areas? Are they going to keep it affordable, or are they going to price it extractively?” MESSAGE US — Are you MICHAEL NEGRON, special assistant to the president for economic policy? We want to hear from you. And we’ll keep you anonymous! Email us at westwingtips@politico.com. Did someone forward this email to you? Subscribe here!
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