ALASKA STATE LEGISLATURE  HOUSE LABOR AND COMMERCE STANDING COMMITTEE  February 15, 2023 3:16 p.m. DRAFT MEMBERS PRESENT Representative Jesse Sumner, Chair Representative Mike Prax Representative Dan Saddler Representative Stanley Wright Representative Ashley Carrick Representative Zack Fields MEMBERS ABSENT  Representative Justin Ruffridge, Vice Chair COMMITTEE CALENDAR  PRESENTATION(S): OVERVIEW FROM STATE OF ALASKA BROADBAND - HEARD PREVIOUS COMMITTEE ACTION  No previous action to record WITNESS REGISTER THOMAS LOCHNER, Director Alaska Broadband Office Department of Commerce, Community, and Economic Development Anchorage, Alaska POSITION STATEMENT: Gave a PowerPoint presentation titled "Alaska Broadband Office Update." ACTION NARRATIVE 3:16:07 PM CHAIR JESSE SUMNER called the House Labor and Commerce Standing Committee meeting to order at 3:16 p.m. Representatives Prax, Carrick, and Sumner were present at the call to order. Representatives Wright, Saddler, and Fields arrived as the meeting was in progress. ^PRESENTATION(S): OVERVIEW FROM STATE OF ALASKA BROADBAND PRESENTATION(S): OVERVIEW FROM STATE OF ALASKA BROADBAND    3:16:40 PM CHAIR SUMNER announced that the only order of business would be a presentation, titled "Overview from State of Alaska Broadband." 3:17:37 PM THOMAS LOCHNER, Director, Alaska Office of Broadband, Department of Commerce, Community, and Economic Development, began his PowerPoint [hard copy included in the committee packet] and stated that the Alaska Office of Broadband was formed in September of 2022. He continued to slide 2 and gave an overview of the department hierarchy and positions. The office currently has three of its four positions filled and is continuing its work in setting up and becoming effective. On slide 3, he gave a brief overview of the Broadband Advisory Board, which includes members of the public, government officials, and various other representatives from different parts of Alaska business and industry. MR. LOCHNER continued to slides 4 and 5 and stated that the majority of funding for the Alaska Office of Broadband would come from the Infrastructure Investment and Jobs Act, with $42 billion being allocated to broadband equity, access, and deployment (BEAD) throughout the United States. He stated that the money will go to the states for usage in grants to build broadband infrastructure in areas without access to broadband. He stated that the Infrastructure Investment and Jobs Act also allocated $640 million for administrative costs associated with the set-up of programs and offices needed to administer the grants. 3:21:23 PM MR. LOCHNER moved to slide 6 and gave an overview of digital equity, inclusion, and literacy. There are three types of grants coming from the federal government to work on these issues: planning, capacity, and competitive grants. He said that Alaska has been awarded a grant of $567,800 for planning and that the latter two grant awards are pending. He stated that the grants are focused on helping populations who may have less access or ability to navigate an increasingly digital world overcome those obstacles. He gave an example of how someone being released from incarceration now after 20 years would be met with many types of technology that they have had yet to experience. MR. LOCHNER continued with slide 7 and gave an overview of the funding and disbursement of the allocated $42 billion. He stated that there would be a minimum $100 million allocation for all 50 states, and 10 percent of the $42 billion would be allocated for "high cost" areas in the U.S. He gave the definitions of service for broadband in relation to download and upload speeds: unserved is less than 25 megabytes per second (Mbps) download and 3 Mbps upload, and underserved is less than 100 Mbps download and 20 Mbps upload. 3:23:58 PM MR. LOCHNER continued to slide 8 and provided a timeline for the grants and funding plans. He stated that the Alaska Broadband Office must submit a 5-year action plan, an initial proposal, and a final proposal to the National Telecommunications and Information Administration. The goal of the Alaska Broadband Office is to have the plans ready by June 15th, July 31st, and November 30th, respectively. 3:26:24 PM MR. LOCHNER continued to slides 9 through 16, reiterating the definitions of broadband access and showing several maps with evaluations on the current status of broadband across Alaska. He stated that 28.9 percent of communities in the state are served. All communities served by broadband are on fiber systems. He said that the current microwave systems do not meet the threshold of 100 over 20 Mbps required to be considered served. He continued that the federal government is involved in bringing broadband to another 20.6 percent of Alaska's communities through programs such as United States Department of Agriculture (USDA) Connect Program and the National Telecommunications and Information Administration's (NTIA's) Tribal Broadband Connectivity Program. After the completion of those projects, 50.6 percent of Alaska's communities will still be under or unserved. 3:29:19 PM MR. LOCHNER moved to slides 17 through 19, showing maps with possible layouts for broadband projects that would reduce the number of communities not being served by broadband. He said the plans have been published online so that the Alaska Broadband Office can receive feedback on the most accurate places to lay down the broadband lines. 3:31:13 PM MR. LOCHNER continued to slides 20 and 21, outlining the next steps for the 5-year action plan. He stated that the Alaska Broadband Office broke down the requirements into three broad categories: Outreach, Network, and Logistics. The office has completed 40, 60, and 70 percent of its goal for each category, respectively. He said that the primary grant criteria is worth 75 percent of the score for the Notice of Funding Opportunity, which includes efficient use of BEAD funding, affordability for consumers, and fair labor practices. The secondary criteria is whether the project will be completed on time, and other criteria include network design, operating costs, Native bidders, and carrier neutral and fair pricing practices. 3:34:44 PM REPRESENTATIVE FIELDS asked if there would be any solutions for parts of urban areas experiencing speeds lower than the category the community is considered to be for purposes of broadband deployment. MR. LOCHNER answered that a particular location within a served area receiving lower than slow speeds would still be lower on the list for funding due to the location still being within a served community. REPRESENTATIVE FIELDS asked if there was any data showing disconnect between the speeds that certain people within urban communities experience versus the speeds that they are theoretically supposed to experience. MR. LOCHNER answered that the Alaska Broadband Office has a speed test available on its website and it wants people to submit their results so that it can collect such data. 3:37:01 PM REPRESENTATIVE WRIGHT asked if the BEAD funding was a one-time grant or if it would be recurring. MR. LOCHNER answered that the BEAD funding is a one-time grant as a part of the Infrastructure Investment and Jobs Act, as well as the grants from USDA and NTIA. He added that the Federal Communications Commission (FCC) does provide recurring grants. In response to a follow-up question, he said that he is unsure whether the federal funding will be enough to cover the entire cost of the planned projects. REPRESENTATIVE WRIGHT asked whether there would be opportunities for matched funding from different municipalities. MR. LOCHNER answered that the Notice of Funding Opportunity requires a 25 percent match, although for some rural high-cost locations that match requirement is waived. 3:39:57 PM REPRESENTATIVE PRAX asked if it was correct that the Alaska Broadband Office planned to use both fiber optic and microwave cables. MR. LOCHNER answered that the office is "technology agnostic" but must meet certain speed and latency requirements. In response to Representative Prax's concern about spending money on a technology that could become quickly outdated, he said that the office is developing an "operations and maintenance" model. REPRESENTATIVE PRAX asked what the permitting process for laying down fiber optic cables would look like. MR. LOCHNER answered that he is working closely with the Department of Natural Resources to ensure that the Alaska Broadband Office has the necessary permitting for whatever type of land the fiber optic cables go across. 3:45:09 PM REPRESENTATIVE SADDLER asked if the BEAD funding was solely targeted at the "covered populations" listed on slide 6. MR. LOCHNER answered that the projects would benefit all Alaskans. In response to a follow-up question, he said that the focus of the funding was making sure that all communities are covered regardless of their population, with the caveat that each project would need to be sustainable. REPRESENTATIVE SADDLER asked why satellite Internet was not on the provided maps as a consideration for providing broadband to Alaska communities. MR. LOCHNER answered that geosynchronous satellites are unable to meet the federal government's speed or latency requirements. He added that low Earth orbit satellites such as the ones used by Starlink also do not meet these standards, although they are a useful stopgap. 3:48:55 PM REPRESENTATIVE WRIGHT asked if there would be a point in time at which Starlink would be able to provide 1 gigabyte (GB) over 1 GB speeds. MR. LOCHNER answered Starlink is "magical" for those that have previously been without any type of Internet previously, although it does have several limitations. In response to a follow-up question, he said that the project would have to be completed within four years to keep funding, with the possibility of a one-year extension. 3:50:38 PM CHAIR SUMNER asked how much money the federal government would allocate to Alaska for the purpose of building broadband. MR. LOCHNER answered that it is too early to know for sure. 3:51:24 PM REPRESENTATIVE SADDLER asked whether it would make sense for the State of Alaska to wait until satellite Internet technology improves before making investments in broadband for rural Alaska in order to lower the cost. MR. LOCHNER responded that in order to receive the federal funding, the state must do what the federal government is incentivizing the state to do. 3:52:17 PM ADJOURNMENT  There being no further business before the committee, the House Labor and Commerce Committee meeting was adjourned at 3:52 p.m.