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Closing the digital divide: A once-in-a-generation opportunity for tribes

Jun 10, 2021

With as many as one-third of all tribal members living on-reservation with unreliable or no internet access, the American Rescue Plan Act of 2021 looks to make strides to correct that.

Congress has laid out four broad categories of allowable expenditures for the uses of Fiscal recovery funds as a result of the American Rescue Plan. 

The four categories of allowable expenses are:

  1. To respond to the public health emergency or its negative economic impacts, including assistance to households, small businesses and nonprofits, or aid to impacted industries such as tourism, travel and hospitality.
  2. To respond to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers.
  3. For the provision of government services to the extent of the reduction in revenue due to the COVID-19 public health emergency relative to revenues collected in the most recent full fiscal year prior to the emergency.
  4. To make necessary investments in water, sewer or broadband infrastructure.

That fourth category stands out as the most indirect response to the COVID-19 pandemic, but it also presents a significant opportunity for tribes. While all four categories are focused on one-time expenditures, the last category is the only one-time expenditure with generational impact.

The state of broadband access in tribal America

In 2019, the American Indian Policy Institute of Arizona State University conducted a survey of tribal reservation residents. The following findings emerged:

  • 18% of tribal reservation residents have no internet access at home, wireless or land-based.
  • 33% rely on internet service from a smartphone at home. However, the reliability of smartphone internet connections is questionable.
  • 31% of respondents stated that their connection was spotty or they had no connection at home.
  • Altogether, there is a need for increased in-home high-speed broadband access for residents of tribal lands.

Broadband access isn’t a problem exclusive to tribal America. The United States as a whole ranks 24th for broadband connections per 100 individuals, and 25th in the world for average connection speed at 26.7 mbps. How does the world’s number one economy fall so far behind?

You could blame it on sprawling countryside and difficult terrain, combined with sparse population across many parts of the country. But, importantly, you could blame it on lack of investment.

How far can the fiscal recovery funds go?

According to the Treasury’s Frequently Asked Questions (as of May 27, 2021), the funds must be obligated by December 31, 2024. However, the period of performance may continue until December 31, 2026. While just over five years is still not an enormous amount of time to undertake significant infrastructure projects, it is certainly far greater than the roughly seven months originally offered in the CARES Act.

The minimum speed standards are 100 mbps download and upload, with some exemptions for 100 mbps download/20 mbps upload. For reservations with significantly slower speeds, or no access, this offers a chance to launch speeds well above the national average of 26.7 mbps.

Another allowable use of broadband projects may include cybersecurity and digital literacy training. With increased internet access and usage comes increased security risk and lack of knowledgeable users. Being able to address these adjacent needs is a nice benefit for governments.

Wipfli can help

If you need assistance determining where and how to invest your tribe’s American Rescue Plan Act funds, contact Wipfli. Our tribal practice professionals can help you meet the demands of today and strategize for the future — leveraging your ARPA funds to the fullest.

Sign up to receive additional tribal-focused content and information in your inbox, or continue reading on:

Revenue loss calculation for tribes, plus cash assistance, under the American Rescue Plan
American Rescue Plan Act provides billions in relief to state and local governments
How governments can spend Coronavirus State and Local Fiscal Recovery Funds

 

Author(s)

Nik K. Wong, CPA, CFE
Senior Manager
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