Community anchor institutions (CAIs)—such as schools, libraries, community health centers, and similar organizations—play a crucial role in offering free or affordable internet access to underserved communities. In many areas, the connectivity options offered by CAIs—whether on-site (via wired or wireless networks) or through remote programs like hotspot lending—are among the few affordable and reliable services available. Rural residents, in particular, face significant barriers to connectivity, as the internet services available to them are often slow, unreliable, and prohibitively expensive. U.S. telecommunications policy has sought to address broadband infrastructure gaps and reduce connectivity costs for low-income households through initiatives like the $42.45 billion Broadband Equity, Access, and Deployment (BEAD) Program. However, experts and state officials have argued that these efforts may not fully close persistent access gaps. As a result, many households continue to struggle with maintaining consistent internet access. To help bridge these digital divides, CAIs—supported by federal, state, and local policies—have become essential partners in delivering internet services and advancing universal broadband access nationwide.

CAIs and Universal Service

The role of CAIs in facilitating internet access emerged partly in response to advancements in telecommunications technologies during the late 20th century, alongside the evolving functions of community-based organizations and corresponding shifts in U.S. telecommunications policy that expanded the definition of universal service while reshaping the mechanisms for achieving it. 

The goal of universal service–ensuring all Americans have access to widespread, efficient, and reliable telecommunications services–was first encoded in U.S. law in the Communications Act of 1934. The system implemented in the 1930s prioritized equitable access to telephone services for both urban and rural subscribers at comparable prices. This was accomplished through a regulated monopoly, with AT&T serving as the sole telephone provider in its designated regions. In return for its monopoly status, AT&T was charged with providing service to as many people as possible at relatively affordable rates. The program was sustained through a cross-subsidy model, where businesses and urban customers paid higher rates to offset the costs of service in rural areas. This approach was largely successful, expanding telephone access to the majority of middle- and upper-income households, though connectivity for low-income households lagged significantly. 

By the 1980s, however, AT&T’s monopoly and the regulations supporting it had begun to erode. In 1984, AT&T was stripped of its monopoly status, leading to the creation of seven regional "Baby Bell" companies. Each company was responsible for providing local telephone service and operated as a monopoly within its designated territory, while AT&T retained responsibility for long-distance service. Instead of a single nationwide provider responsible for universal connectivity, each regional company was now tasked with ensuring coverage within its own area. While U.S. policy continued to uphold the principles of universal service, the breakup of AT&T disrupted the cross-subsidy model that had previously supported the objectives of the 1934 legislation.

The Telecommunications Act of 1996 expanded the definition of universal service to include “advanced telecommunications and information services” like internet access. However, while the concept was modernized, the existing program—designed for traditional telephony—was not fully adapted to support internet connectivity. Additionally, with AT&T no longer serving as the sole provider, no single entity was responsible for achieving universal service.

During this era, telecommunications policy largely focused on deregulation. Lawmakers assumed that the growing demand for advanced telecommunications technologies like the internet in a free market would drive innovation, reduce costs, and eventually lead to widespread diffusion of these technologies across society. Around the same time, however, scholars and advocates grew increasingly concerned about the burgeoning digital divide, recognizing that certain segments of the population—including minority and low-income communities, women, the elderly, and people with disabilities—were likely to face significant barriers to accessing and effectively using these technologies.

To address these disparities, policymakers like Al Gore and Larry Irving, along with organizations such as the American Library Association and the Education and Libraries Networks Coalition (EdLiNC), advocated for initiatives aimed at bridging the digital divide. Many of these efforts relied on CAIs to provide underserved populations with internet access, devices, and digital skills training.

The Telecommunications Information and Infrastructure Assistance Program (TIIAP), launched in 1994 at the National Telecommunications and Information Administration (NTIA), was a merit-based grant initiative aimed at funding projects that expanded access to advanced telecommunications and information technologies. Its successor, the Technology Opportunities Program (TOP), continued this mission by offering funding to public and non-profit organizations—such as schools, libraries, healthcare providers, and local governments—to promote the use of information and communications technologies (ICTs) and create opportunities for un- and underserved communities. Similarly, the Department of Education’s Community Technology Centers (CTC) program provided financial assistance to establish computer tech centers that provided public access to technology in underserved communities. 

However, the role of CAIs in achieving universal internet access was solidified in Section 254 of the Telecommunications Act of 1996. This section facilitated the establishment of key programs—such as E-Rate and Rural Health Care—as components of a new Universal Service Fund (USF). These programs were designed to ensure affordable internet access for certain types of CAIs, including schools and libraries (through E-Rate) and rural hospitals, community health centers, clinics, etc. (through the Rural Health Care Program). By offering significant subsidies, these initiatives enabled institutions like schools and public libraries to secure internet connectivity, particularly in communities where commercial providers were unable to offer sufficient or affordable services. In turn, these institutions were able to utilize the internet to fulfill their missions, and for some CAIs, such as public libraries, this included providing internet access to the broader public.

Although the 1996 Act primarily emphasized free-market solutions for advancing universal access, its assumptions about competition expanding access to rural and low-income areas were overly optimistic. In the years following passage, market forces alone proved to be insufficient to meet the needs of many communities—a challenge that persists into 2025. Rural and low-income areas remain chronically underserved, as private companies lack incentive to invest in less profitable service areas. Even when ISPs provide service, it is often costly and/or inadequate. In response, communities increasingly rely on CAIs, supported by the USF and other programs, to bridge connectivity gaps. 

Defining Community Anchor Institutions

While U.S. telecommunications policy has long supported CAIs in accessing internet connectivity to further their institutional missions, the term "community anchor institution" and its association with broadband did not fully emerge until the early 2000s. Initially, the concept referred to large urban institutions, particularly universities and hospitals ("eds and meds"), that served a public service mission. These institutions played pivotal roles in outreach and revitalization efforts in economically distressed urban areas during the 1960s and 1970s, a period of widespread urban decline and economic recession. Valued for their strong local ties, extensive infrastructure, and ability to employ significant numbers of local residents, CAIs contributed to economic investment, social stability, and community vitality, even as urban blight devastated cities across the nation.

Over time, the concept of CAIs expanded to include a broader range of community-based organizations, such as K-12 schools, libraries, public housing facilities, public safety offices, government buildings, employment training centers, senior care facilities, and other local institutions that serve the public good. 

CAIs in National Broadband Policy 

As the term "community anchor institution" gained prominence in federal broadband policy, both federal and state laws sought to define CAIs within the context of broadband initiatives. For example, the Broadband Technology Opportunities Program (BTOP), a $4 billion grant initiative established under the American Recovery and Reinvestment Act (ARRA) of 2009 and administered by the NTIA, aimed to expand broadband access and adoption in underserved and unserved areas. BTOP was the first program to prioritize funding for CAIs as part of its core objectives, underscoring their critical role in bridging the digital divide. 

BTOP was also the first federal program to offer a formal definition of CAIs, describing them as: 

“schools, libraries, medical and healthcare providers, public safety entities, community colleges and other institutions of higher education, and other community support organizations and agencies that provide outreach, access, equipment, and support services to facilitate greater use of broadband service by vulnerable populations, including low-income, unemployed, and the aged.” 

The definition of CAIs introduced through BTOP has since served as a foundational basis for subsequent federal and state policies related to broadband expansion.

More recently, both the Broadband Equity, Access, and Deployment (BEAD) Program and the complementary Digital Equity (DE) Programs– enacted in 2021 as part of the federal Infrastructure Investment and Jobs Act–have provided their own definitions of CAIs. Notably, the BEAD Program, which provides $42.45 billion to expand high-speed Internet access, offers a baseline definition of CAIs, but allows states the flexibility to expand on it or create their own, provided they can justify their rationale. This flexibility is especially important in rural areas, where states aim to maximize limited resources to improve connectivity through CAIs, even in cases where traditional CAIs may be scarce.

As states developed their initial BEAD proposals, many sought to redefine CAIs, acknowledging that local communities are often best positioned to determine which institutions are most effective in serving as CAIs within their specific contexts. For instance, Montana’s five-year plan includes bar-and-grills in its definition of CAIs, while Vermont’s plan includes houses of worship, correctional and juvenile detention facilities, public access television stations, and public outdoor spaces.

Allowing for adaptability means states can tailor CAI definitions to more effectively address their particular connectivity gaps in underserved and hard-to-reach communities. Given the high costs of connecting individual households, prioritizing local CAIs helps states maximize their resources and expand coverage to a larger population. For example, in addition to providing on-site access to high-speed internet or hotspot lending programs for home use, connecting anchor institutions to fixed wired networks can further help states reduce the cost of last-mile connections to local homes and businesses, thereby extending broadband access.

CAIs in 2025 and Beyond

As CAIs' role in broadband access becomes increasingly central to their missions, federal policy continues to emphasize the importance of utilizing these institutions to promote connectivity and support initiatives related to service expansion, innovation, education, and economic development. 

Both the BEAD and DE programs encourage states to incorporate CAIs into their plans, albeit in distinct yet complementary ways. BEAD focuses on connecting unserved CAIs, while DE plans rely on these institutions to carry out digital equity programming. 

Several states have already taken steps to maximize the potential of their CAIs. For example, Louisiana has designated libraries as emergency response centers, while other states are establishing community technology centers (CTCs) that will employ digital navigators and provide additional resources. Despite these efforts, many CAIs remain underutilized and inadequately supported. While the BEAD Program recognizes the importance of connecting CAIs to gigabit service, some states have acknowledged that they do not expect to have sufficient funds left to connect all their CAIs. Despite the valuable opportunity to increase access through CAIs presented by the BEAD program, only time will tell how successful these initiatives will ultimately be.

Emily C. Rubin is a doctoral candidate in Journalism & Media at the University of Texas at Austin and a Benton Opportunity Fund Fellow. Her research focuses on the role of community anchor institutions in state BEAD and Digital Equity Program plans. Rubin also holds an MFA in Media Studies from Long Island University, Brooklyn.

The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.

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