Could the feds withhold broadband funding to some states?

A conflict between state and federal laws may delay the first distribution of Broadband Equity, Access, and Deployment (BEAD) Program funds to the states. Sixteen states bar or restrict municipally owned broadband—and nearly all of those states appear unwilling to amend their laws as they finalize plans for how they will use their share of BEAD funds. That could put them at odds with the Biden administration, which supports having more cities and local governments offer broadband. Pennsylvania has adjusted its initial draft plan to clarify how it would approach the existing state law. Under its public utility code, the commonwealth prohibits local governments from providing broadband in areas where a telephone company like AT&T offers internet service. But the Department of Community and Economic Development Department has said that while adhering to federal and state law, it would seek to work with and distribute funds to municipalities to meet local broadband needs. Nevada’s proposal is demonstrative of others with similar laws in that it will not make BEAD funding available to cities. Its Office of Science, Innovation and Technology said it’s not able to change a state law that bars municipalities with more than 25,000 inhabitants or counties with more than 50,000 inhabitants from providing internet service.