Texas announced on Monday that its proposed Broadband Equity Access and Deployment program spending will reach $1.27 billion, representing a $2 billion decrease from the $3.31 billion allocated to the state in 2023, as broadband infrastructure requirements have decreased substantially nationwide.
Massive Budget Surplus Emerges from Improved Coverage
The Lone Star State has a significant underutilization of funds because the number of locations that need broadband service has decreased dramatically from 780,000 in 2023 to 240,000 before the summer grant application period began. The decrease in eligible locations for broadband service resulted from better mapping accuracy, private investments, and other federal and state funding programs that expanded internet access.
Glenn Hegar, director of the Texas Broadband Development Office, had anticipated the budget surplus earlier this year, estimating in March that the state would come in as much as $1 billion under budget—an estimate that proved conservative as the final shortfall reached more than double that amount.
Trump Administration Policy Changes Drive Cost Reductions
The Trump administration’s June policy changes regarding fiber preference requirements and the emphasis on cost savings in the $42.45 billion national BEAD program led to significant cost reductions. The policy changes enabled states to select affordable broadband solutions that met service quality requirements.
“We wanted to support common-sense, non-deployment initiatives such as workforce development, small business growth, education, and healthcare improvements that will enhance quality of life and drive economic growth.”
— Glenn Hegar, Texas Broadband Development Office Director
States have achieved substantial cost reductions through the policy change because more than $20 billion of BEAD funding allocated to states remains unspent based on their draft results.
Technology Mix Balances Fiber, Satellite, and Wireless
The approved broadband deployment strategy of Texas implements multiple technologies to provide service to all unserved locations. The service expansion will deliver fiber connections to 51% of 243,000 locations, while satellite service will reach 27% and fixed wireless technology will serve 22% of these areas.
The funding recipients for broadband expansion include AT&T, Brightspeed, Charter, and Frontier, as well as multiple regional and local internet service providers. The funding awards for Elon Musk’s SpaceX and Amazon’s Project Kuiper satellite internet services became public knowledge on Wednesday, although the exact dollar amounts remained undisclosed. The technology distribution pattern follows the national BEAD framework, which plans to use fiber for 66% of locations, satellite for 21% and fixed wireless for 11%.
Uncertain Future for Surplus Funding
The fate of Texas’s $2 billion surplus remains unclear as federal officials determine policy for unused BEAD allocations. Under the previous Biden administration, states planned to spend leftover funds on “non-deployment” activities, including workforce development and broadband adoption programs.
However, the Trump administration rescinded approval for such activities in June and indicated additional guidance would be forthcoming. Republican Governor Jeff Landry of Louisiana and GOP lawmakers on Capitol Hill have lobbied Commerce Secretary Howard Lutnick not to claw back the surplus funding.
Final Approval Process Continues
The public has one week to review Texas’s draft plan before the state submits its full proposal to the Commerce Department for approval. The Commerce Department extended the deadline for Texas and California to submit their plans because of their extensive size and special legal requirements. However, all other states submitted their plans immediately after September 4.
The November 21 deadline for California to submit its plan to the Commerce Department indicates draft results will become available on November 14. The National Telecommunications and Information Administration has not approved any state plans because it requires states to reduce their spending before giving final approval.