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Priorities Podcast
The pole problem: A hidden challenge for BEAD deployment
00:27:32
Michael Santorelli of the New York Law School sai…
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- [00:03]
A
Welcome to State Scoop's Priorities podcast. I'm Keely Quinlan, a reporter with StateScoop. This week I interviewed Michael Santarelli, director of the Advanced Communications Law and Policy Institute at the New York Law School, about a report his organization recently released. It takes a closer look at the role of utility polls in the deployment of projects funded by the federal $42.45 billion broadband equity access and deployment, or bid program. We talk about why polls have become such a critical issue how the regulatory landscape differs among private owned utilities, electric cooperatives and municipal systems and what policymakers, utilities and broadband providers can do to reduce delays and keep projects on track. But first, here's what's happening in state and local government technology news this week, Colorado's Office of Information Technology announced a sweeping restructuring that includes the elimination of 173 positions and the appointment of Sarah Thunberg as the state's new Chief Information Officer. The overhaul follows concerns about service delivery, technical debt and governance challenges, and IT marks one of the most significant state IT reorganizations in recent years. The City and County of Honolulu's Department of Planning and Permitting is rolling out an AI powered tool called SIF Check to help help applicants identify errors, missing documents and code compliance issues before permit applications are submitted. Officials describe the system as TurboTax, like guiding users through the permitting process in an effort to improve both application quality and reduce delays. Statescoop announced the winners of the 2025 Statescoop 50 Awards recognizing the most influential leaders in innovative projects in government technology. This year's awards honor officials, programs and technology initiatives from 21 states and highlighted emerging leaders driving modernization across state government. The BEAD program is expected to fund tens of billions of dollars in new infrastructure construction, much of it in rural and high cost areas where aerial deployment of fiber on utility poles remains the most economical option. But the process of attaching fiber to these existing poles is governed by a complex mix of of federal regulations, state laws, utility policies and contractual arrangements that can vary significantly from one jurisdiction to another. These complexities are the subject of a recent report from the Advanced Communications Law and Policy Institute at the New York Law School, and we talked with Michael Santarelli, the Institute's director, about what that means for bead. His organization's analysis estimates that BEAD funded projects could involve nearly 4 million utility owned polls across the country, and we start off the conversation with discussing why it's important to these challenges as states finalize their awards and begin building our
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program at New York Law School, the aclp We've done A lot of work on all things speed over the years. And we try to harness as much data as possible to inform a lot of the conversations that have been ongoing now for almost what, four years. And so we looked at polls as part of this bigger batch of potential barriers and challenges that still remain after all this time of planning and back and forth and whatnot around bead. There are still these very granular nuts and bolts types of issues on the ground that could hold back, delay, raise costs of some projects. And broadly speaking, in our view, and others have agreed too, it kind of falls into utility poles permitting and getting access to local rights of way and getting onto private property, all of which is needed to, in some way or another to support broadband deployment through bead. And generally speaking too. And we looked at polls first because it was the relatively easiest of the three, just because there is some amount of data out there. But as we'll talk about in a few minutes, the data isn't all that great. So it still involves a lot of estimates and things like that. But we focused on polls first, given the availability of data. And also, it's just, it's an issue that keeps popping up for the last however many years and the fact that a very simple, like 19th century technology of giant wooden poles is still impacting the deployment of very advanced networks across the country. So it's just one of these issues that is evergreen in the sector and we wanted to try to put out some interesting new insights into it.
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A
Yeah, absolutely. You know, before we got on, I looked out my window in my living room and realized I could see no less than at least 12 of them. So this is a ubiquitous issue. So, you know, your report estimates that BEAD funded deployment could touch nearly 4 million of these polls. So what surprised you most when starting to kind of map out this like poll access data? It's so fascinating, right?
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B
So it's one of those things where it kind of blends into the background, but then when you start looking more closely, you realize that they're everywhere. And so There are about 180 million Poles across the country, which is a huge number. So what surprised us most is that there I mentioned that there's some data around this issue, but there's really not a lot. And it's surprising given how ubiquitous they are, how important utility poles are for brainy electricity service to, you know, a lot of Americans. And it also telephone wires, cable wires, increasingly fiber wires, but there's not a central database. There's no like exact count of how many poles There are, even if you look at individual states, most states have very little insight into exactly how many poles there are, where they are, the, the status of them. And so trying to ferret out information and data about just the larger issue of how many there are, where they are, it involves a lot of estimating and just making reasonable assumptions and things like that. And when we get into the more cost estimates, those are also based on just a handful of data sets that we were able to find. So there's just not a whole lot of information out there just on this very, still very critical issue in the broadband sector. And just it's also, it's, it's a huge part of our national critical infrastructure. And there's just not a whole lot of insight into where they are, the status of them, things like that.
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Yeah, that lack of data is very interesting. And then of course, you know, like in, in, in doing this work, one of the report's biggest finding was that about 40% of the aerial bead fiber. Right. Will cross these electric cooperative territories. And though, even though like these co ops, as the report found, serves less volume of customers. Right. They're, they're very important. So why does this mismatch, I guess, and what like, can you explain it a little bit more for like folks that maybe aren't familiar? And then why does it matter so much in terms of deployment?
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Sure. So that figure comes from. And again, this is where the estimating comes in. It's a, it's a ballpark figure. So, you know, we started with 180 million poles. So we know how approximately how many poles there are, how many poles are needed, how many poles there are per mile in the US we estimated that as well because there are so many. There's like a uniform, some uniformity in how far apart they're spaced. We know exactly where the bead projects are going to be across the country. That's very precise, thanks to fabric, the FCC's fabric data and the state broadband offices, pinpointing exactly where the projects are going to be, which has been very helpful for us and for many others. And then we overlaid those projects with electric utility service territory maps that we found and came up with this number of figuring out approximately how many poles there will be in each kind of electric utility service territory. And we focused on electric utilities because they own the vast majority of electric pole utility poles in the country. Telephone companies own a bunch, but electric utilities own the vast majority. And they seem to be the ones involved in a lot of These disputes with ISPs around access and things like that, which we'll talk about later. And so we found not surprisingly that the most poles will probably be in electric service territories where served by investor owned utilities, which are private utilities here in New York it's like Con Edison and there's like Duke Energy, those big private utilities and they serve about 70% of electric customers across the country. And then when you get into very rural areas, that's where electric co ops serve a lot of customers. And getting to your question, cooperatives sprung up a hundred plus years ago as electricity was being deployed across the country. It came to big cities first and then as much slope more slowly in some ways kind of like broadband deployment, but a lot of differences. But electric service came first the urban and suburban areas and then once you got to rural areas, cooperatives sprung up from local customers saying, you know, we want electric power. So they kind of rallied together, formed these cooperatives and brought electric service to their service territory. Now they serve about 13% of all electric customers. The fact that we estimate that these bead poles, as we can call them, will be in about 40% in electric cooperative territories, it's not surprising just because they are primarily rural in nature. And a lot of these remaining bead projects are in these very rural, hard to serve areas where for a long time cooperatives, again areas where cooperatives set up their own electricity networks a long time ago and now they are the areas where broadband is still unavailable. So there'll be a lot of poles in their service territories and as we'll talk about, I guess in a little bit, the regulatory issues around with electric cooperatives very much, very different than that around private investor owned utilities. And so that the fact that say 44% polls and investor owned utility territories versus 40% in cooperative territories, the regulatory differences between those two are pretty significant. And it could lead to similar kinds of outcomes, but maybe varying in degrees in terms of the processes by which ISPs have to access these polls.
- [10:53]
A
Yeah, absolutely. And you know, kind of to like dig in a little bit more on that like regulatory, you know, aspects that you were pointing to, like you describe in the report poll attack attachment regulation as a patchwork. Can't tell you how many times I've heard that word when talking about policy, regulation, all of that jazz. So. But though for listeners who you know, don't live and breathe telecom policy every day, what does that like fragmentation actually look like on the ground for those ISPs like you said, that are like trying to build fiber in These spaces and like are having to navigate like is it a co op, is it a private, you know, utility? How do we even begin to have those conversations?
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Yeah, so it is. One of the reasons this issue is still around is because of this patchwork. And I'll try my best to talk through it a little bit without everyone's eyes glazing over. So for investor owned utilities, again, these private energy companies that provide service to the vast majority of country, they're regulated in one of two ways. They're either subject to the pole attachment regime, pole regimen by the FCC which is set forth in federal law and gives the FCC jurisdiction over Again, these private IOUs and access to their polls. And they have poll formulas and lots of pretty granular rules on a whole host of how you get access to the poll, permission to access the poll, the costs of attaching to the pole, replacing the pole, things like that. So it's pretty, there's still disputes as we'll talk about a little bit, but there is a pretty robust regime at the FCC and that covers only 27 states in the U.S. federal law also allows states to so called reverse preempt themselves and get out of the FCC regime and have it on their own. So the 23 states have their own regulatory approach to private IOU polls. Some of them follow the FCC pretty, pretty straight, pretty significantly. Others have gone down their own path. There are still some, like in Massachusetts for example, they're currently still trying to figure out what their poll regime will look like for IOUs that's actually ongoing right now. So in those 23 other states it is a bit more fragmented now. Those rules don't apply to cooperatives or municipal electric utilities because they've been excluded from, they're excluded from the federal law. They're, they're left to the states entirely. And so across the 50 states, there's a whole host of different approaches for regulating electric cooperative poles and municipal electric utility poles. And some states regulate both, some states only regulate one and not the other. And some states don't regulate them at all in terms of their polls. And so when you, that is a very fragmented framework. So if you're a major ISP serving many different service territories in, in different states like a Comcast or AT&T or whomever, and you're building across a whole host of different utility territories, that means you have to navigate different regulatory regimes that might be wildly different. And so you might be in a FCC poll state. So that'll give you some certainty with the iou. But then you might be in a next door, in the next county, you might be served by an electric cooperative that is not regulated at all. And they're left to their own devices to come up with their own poll rules and set their own prices and things like that. And then there's no recourse if there are disputes. It's essentially a business negotiation in which these utilities have a lot of leverage over ISPs because they own the poll. So they're like, you know, I've heard stories about lots of changing terms throughout a negotiation in some of those instances where, again, there's no recourse. So it is a very broad spectrum of regulatory approaches for polls still. Again, we're in the 2000s and is still very, it is still very much fragmented.
- [15:02]
A
Yeah. And I want to dig a little deeper on one of those disputes that's kind of been making, making some waves in just a moment. But before we get there, I would love to, like, kind of talk about the cost element of this. Right. Like in the report you talk about, like, how these unexpected costs, right, for these small ISPs could cause delays, defaults, or even make some of these projects, like, uneconomic, you know, like, which is the whole point of this project. Right. How serious is that right now as bead projects are moving into construction. Right. Like, literally just this week we had, I think, the first bead home connected to the Internet. So, like, how serious are we talking?
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Yeah. So finally the first household, which is great, through bead again, almost four years later, and we're finally getting there. So. But as we've been hearing over the past, I guess a year or so since the benefit of the bargain round came out, and again, that kind of like drove costs down across the board. We've heard anecdotally and in the press that costs for a number of different inputs have gone up for labor, for materials, and also for accessing critical infrastructure like poles. And so in our report, we try to estimate again, what the range of potential costs around utility poles could be. And I'll start by saying that every applicant in the bid process should have included, you know, the reasonable estimates for these kinds of costs in their bids. So there should be some, like, line item in their, in their bid proposals for poll access or things like that. Upon what, what those are based on, I'm not sure, but probably past experience in, in building these networks and accessing polls. But again, with benefit of the bargain, the focus was on driving down costs as much as possible to, to win the award. So there wasn't a whole lot of room to budgeting contingencies or buffers or things like that. So it is, it's a pretty tight budget, it seems. And so when it comes to polls, there are a couple different kinds of costs. There's like make ready costs, which is essentially when you kind of go look at the poll and you see if things need to be moved around on it to make room for your broadband facilities that. Cause that's like surveying and engineering costs. Then there's the cost of actually attaching things to the pole, like actually putting on the fiber once everything's made ready for it. Another wildcard is also potentially if a utility says, oh, you know, the only way you can access this pole is if we replace it because it's already overloaded or it's falling apart or whatever. So if you want to attach it, then you got to replace the pole to make it stronger so you can hang your stuff on it. And so in our report, we try to estimate what those costs look like. And again, there's not a whole lot of data out there on these. We just, we went through some regulatory dockets in different states across the country and came up with a couple of ranges of things potentially. And the biggest range, I mean, make ready costs are fairly standard. It seems like it is. It's like a big consulting service and engineers go out and take a look at things and that's somewhat standardized. Pole attachment, like the actual attachment fees are somewhat standardized, it seems. I mean, the range of those can be large, but it's, it's not huge. But the biggest range that we saw, or for pole replacements, which could be significant, it could be anywhere from a couple thousand dollars to tens of thousands of dollars, depending on where the pole is, how big it is, et cetera. So when it comes to unexpected costs, again, within this world of fragmented regulatory approaches, not a whole lot of specific clarity on what these costs should be, who should pay what, which. Should the ISP foot a certain percentage? Should the electric utility foot a certain percentage? There's any number of different possible outcomes that could lead to higher costs for ISPs looking to again use these poles, 4 million or so electric utility poles, to hang their fiber to bring it to customers. And you know, as bead starts to roll out, we'll start seeing more negotiations, potentially more disputes between ISPs and electric utilities as they try to finalize these numbers, which could be a little bit fluid, again, depending on status, the health of the pole, what else is already on there or things like that.
- [19:31]
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Yeah. So it sounds like some of those like cost estimates are going to be dependent on a whole lot of factors. But to kind of go back a little bit to something we touched on a little bit earlier and to zoom in on some of the ways these issues. Right. Can manifest. We've recently seen the somewhat high profile dispute come about between Comcast and the Appalachian Power Company over who should pay for some of these replacement polls. Right. Like with non compliant utility poles. And the fcc. Right. Ultimately stepped in and ruled against APCO wanting to charge Comcast for I think almost the entire cost of the poll replacement. If I'm not, if I'm not mistaken, just to share access with the poll. So your report notes you know, this incident and I wanted to ask obviously do you see this as like an isolated incident or do you think that this is going to be a preview of something that maybe we'll see kind of trickling out across the country as the construction of these bead related projects comes into fruition?
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Yeah, the Comcast Appalachian Power dispute is very important and it's still ongoing. And so that dispute is notable for a couple of reasons. One it. Well, so last year the FCC adopted a whole bunch of new poll rules that actually just went into effect the other day. But as part of their poll reforms over the past few years they've launched a rapid response team for these kinds of disputes. And so they really tried to facilitate quicker dispute resolution which previously could drag out for months and months and months. But now I think there's, everyone agrees that these should be just resolved more quickly. And so the Comcast dispute I believe was probably, I think one of the first ones to use this process to go from start to finish within 60 days, which is pretty significant. You know, government moving that fast on anything is, is always impressive. So. And they went, they did it in 60 days. So that was significant. And then the issue that you touched that you mentioned was around pole replacements and before it got to the FCC it had been playing out within Virginia for a while, which is where it initiate originated. And it took a while for that to get knocked around a little bit and then but yeah, it was about pole replacement costs and Appalachian Power was found to have, in contrary to FCC rules, they tried to have Comcast pay for the entire pole replacement cost where there were pre existing conditions on the pole. So it was instances where Appalachian Power, according to the FCC should have replaced the pole on its own or had it done it previously because it was, there were safety violations. It was falling apart or whatever. But then Comcast comes along and said they needed the pole to deploy and you know, certain parts of Virginia and Appalachian Power said, oh well, you can, you can pay for this, you can foot the whole bill. But the FCC made clear that the kind of core principle for a lot of their rules are, you know, whoever causes the cost has to pay for it on like a proportionate basis. And so, you know, shifting a 100% of the cost of these replacement polls, Comcast was contrary to that core principle. And so SEC issued a pretty clear order providing, you know, details around what these, setting that precedent, you know, memorializing that in the poll replacement context and providing some specificity around the specific dispute between Comcast and Appalachian Power. But then just earlier this week, on Monday, Comcast went back to the FCC and filed another complaint against Appalachian Power through the same process, through the same rapid response process, alleging that Appalachian Power is still trying to shift disproportionate amount of the replacement costs to them. In, you know, contrary to the FCC's previous order, in theory, I don't think Appalachian Power has responded yet to the allegations, but in theory that they'll be resolved within 60 days, hopefully sooner because it will set a important precedent for these issues generally, but also in the BEAD context because we're starting to see things roll out. And just to get back to your, another part of your question about the kind of impact on BEAD generally. So this could, this will have an impact on bead, just given again the fact that there are a lot of IOUs involved subject to FCC jurisdiction across the different states. But one thing I haven't mentioned yet included in our report is that NTIA has, as part of its conditions for beid, has required every electric utility, iou, cooperative, municipal that is receiving money through BEID has to essentially be subject to the FCC's poll rules. So this is a big issue for cooperatives who were usually or have been excluded from the FCC rules according to federal law. But now all the cooperatives, I think there are several dozen that are receiving BEAD funds as a condition of that they have to, they have to be subject themselves to the FCC poll rules. And that's a controversial point amongst the rural electric community. But anyway, this, this ongoing dispute between Comcast and Appalachian Power could be replicated many times over as BEAD rolls out. Especially with ISPs potentially having recourse against cooperatives to get access to their polls on more uniform terms that they've had in the past.
- [25:06]
A
Yeah, definitely. And Then I guess my last question for you is given all of this, and all of this being, you know, very granular data, but also like really important takeaways for, you know, folks that are in this, like, you know, driver's seat with this policy, if you could tell state broadband directors that are listening or any other folks that are kind of in this space, maybe one key takeaway, right. If they had to walk away with one thing, what would you hope it would be?
- [25:35]
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Well, I think a couple of points. One would be to, you know, just when they thought, I guess their, their job was done would be. I mean, there's still plenty to do on all this. So trying to help mediate some of these disputes potentially, or head some of them off, be be aware of the possibility of these issues popping up, which I'm sure they already are. I'm sure they've heard about these issues many times over from their applicants. But also more broadly, looking ahead down the line, advocating for more consistent poll rules in their states, there's any number of things that state legislatures, state public utility commissions could do on these issues. It'd be helpful if Congress stepped in, but that's probably unlikely. So to the extent states hearing from their expert broadband offices on this could do something to again, provide some clarity and consistency would be great. But yeah, these types of issues are probably going to continue to pop up like in polls and permitting and other issues. So broadband city broadband officers offices have been great on so many issues and they probably know all these issues are coming. So to the extent they could play helpful roles in trying to maybe head off some of these disputes would be. Would be great.
- [26:49]
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That was Michael Santarelli, director of the Advanced Communications Law and Policy Institute at the New York Law School. We were sending our many thanks to him and his organization for participating in that conversation. You can subscribe to the Priorities podcast@monities podcast.com and wherever you get your podcast while you're there, be sure to leave a review or a rating on the podcast page. That small extra step helps more people like you find the show. This podcast is a production of Scoop News group in Washington, D.C. production work is done by Adam Butler and Carlin Fisher until next week. I'm Keely Quindlen. Thank you for listening.