NTIA wants to claim leftover BEAD funds as taxpayer ‘savings’

At least 36 states and territories have submitted to the federal government final proposals outlining how they plan to use the billions of dollars in funding provided by the Broadband Equity, Access, and Deployment, or BEAD, program. While the the federal agency overseeing the program said the new proposals will deliver a projected “savings of at least $13 billion for American taxpayers,” experts say this assertion may be misleading.

The assertion, which was made by Commerce’s National Telecommunications and Information Administration on Sept. 5 one day after the agency’s deadline for states to submit their final proposals, credited the alleged savings to its recent “benefit of the bargain” round of subgrantee selection, which states were required to complete as part of the new program guidance shared in June by Commerce Sec. Howard Lutnick.

In its statement last week, the NTIA said the program changes will “turbocharge” speed of deployment and the increase the amount of “savings” for taxpayers, with some states now proposing to use less than half of the funds they were originally allocated through BEAD on direct broadband deployment. However, this $13 billion figure, which is derived from the difference between the amount of funds originally allocated to the 36 states and territories in 2023, and the unspent funds remaining after the bottom line of those new proposals filed last week, is not set to go back into the pockets of the federal government — not yet, at least.

Drew Garner, director of policy engagement at the nonprofit Benton Institute for Broadband and Society, said it’s misleading for the NTIA to claim these funds as “savings,” because under the Infrastructure Investment and Jobs Act of 2021 that created the $45 billion broadband program, the funds are meant to remain with the states even if they aren’t spent directly on building out new fiber networks or installing wireless towers.

“The administration clearly wants to claim [the leftover funds] as savings. They want to return it to the Treasury and say, ‘We saved all this money,'” Garner said, adding that the Trump administration, which has made improving efficiency and slashing regulations a key priority in its first months, may use this claim to advance that political agenda.

“By law, all of this money is the state’s money. So if a state does not spend it during their deployment grant rounds, that money, by law, still belongs to the state,” Garner said. “For other purposes, as written into the Infrastructure Investment Jobs Law, there are these other activities, these nondeployment purposes, that Congress created to support all of this deployment.”

Some of the nondeployment uses approved under the 2021 infrastructure law included bolstering public services tied to broadband access, such as workforce development, telehealth, cybersecurity and digital literacy. But now there are more leftover funds than initially anticipated, which can be attributed to a large decline in BEAD-eligible locations thanks to additional grant-funded projects via American Rescue Plan broadband funds and the Rural Digital Opportunity Fund, as well as lower costs per location made possible by the new program guidance allowing BEAD monies to be spent on technologies that are cheaper to install than fiber, such as satellite and fixed wireless.

The new program guidance Commerce released in June did not offer new rules for how states could use the leftover funds on nondeployment items. Instead, the agency rescinded any previous approvals of nondeployment activities approved under the Biden administration, did not require final proposals to include plans for the use of these funds and said it would issue updated guidance in the future.

But this uncertainty regarding how states can use the funds has created tension among lawmakers and politicians on both sides of the aisle. At the end of last month, 10 Democrats from the House of Representatives sent a letter to Lutnick and NTIA Administrator Arielle Roth asking for clarification on how states can use the nondeployment funds, demanding answers by last Sept. 2.

And on Monday, staunch Trump loyalist Louisiana Gov. Jeff Landry sent Lutnick a letter, imploring the agency to allow states to keep the leftover BEAD funds as long as they are used to advance the administration’s priorities within the states, such as the White House’s AI Action Plan and “America First” policies geared toward education, workforce and economic development.

“We therefore suggest that NTIA issue clear guidance on October 1, 2025, instructing states to submit non-deployment plans that may only include projects that advance one or both above within 60 days,” Landry’s letter to Lutnick read. “We ask that proposals be evaluated on a rolling basis, and awards announced by you and President Trump no later than January 20, 2026. Any proposals not aligned with these goals should be denied, and impacted state allocations be re-assigned to other states.”

Garner said that while the infrastructure law already provides the NTIA with the ability to redistribute a state’s unused BEAD funds to other states, at no point are the monies supposed to return the federal government. And the amount of unused funds across the country could total well into the billions once the remaining 20 states and territories that were granted an extension by the NTIA file their proposals.

“Any of these states that are saving money, according to the current law, would simply just be giving that money to other states. So what Landry is saying is to change those eligible uses of funds and then deny anyone’s proposal that you don’t like, and when you deny that proposal, then all that remaining funding would be reallocated to the other states,” Garner said. “So he’s not suggesting anything new, just sort of a more, a different use of the existing law.”

Garner also pointed to the Trump administration’s outright cancellation last May of millions in funds that states were set to receive through the Digital Equity Act. While the cancellation should have taken an act of Congress, the administration was still able to claw back the funds. Garner said the leftover BEAD funds might follow a similar course, though the administration can expect strong pushback.

“I think they would be up against opposition from Congress and from the states, because this has the potential to be billions of dollars, and it could be used on track to be used for very core state interests, very important infrastructure and connectivity goals,” he said. “They could do something like [the Digital Equity Act] again, or they could ask Congress to officially rescind the money in the future and put it back in the Treasury. So, for the administration to claim this money as true savings, they would need to change the law or ignore the law.”