Objective

To determine whether Empire State Development (ESD) has effectively monitored and managed the New NY Broadband Program and whether the Program has achieved its overall goals. The audit covered the period from January 2016 through November 2021.

About the Program

In 2015, New York State established the $500 million New NY Broadband Program (Program). The goal of the Program was to achieve statewide broadband availability by the end of 2018. ESD’s Broadband Program Office (BPO) is responsible for managing the Program, which includes identifying census blocks eligible for funding, establishing grant disbursement agreements with Internet service providers (ISPs), verifying completed work, and creating a statewide broadband availability map. BPO made a total of 53 Program awards, consisting of 126 individual projects totaling $487.2 million, with $301.6 million disbursed as of November 2021. Currently, BPO states that broadband Internet is available to 98.95% of the State.

Key Findings

• BPO established adequate internal controls to effectively monitor and manage the Program, including establishing agreements with ISPs outlining Program requirements, using external entities to assist in identifying eligible census blocks, reviewing project proposals, validating project construction, and reviewing project expenditures.
• While the Program, once fully implemented, will have connected 255,994 housing units across the State, the Program fell short of achieving its overall goal of providing statewide broadband availability. According to BPO officials, as of March 2021, there were over 14,000 households that remain either unserved or underserved.
• The Program connected 78,690 of 255,994 housing units (31%) using satellite technology. Satellite service offers a maximum download speed of 25 megabits per second (Mbps), making it a less viable option to meet the needs of today’s Internet users.
• Over half of the 126 projects experienced some type of delay, ranging from 1 to 48 months. As of January 2022, nine projects have yet to complete network construction. Specifically, four projects for a single ISP affecting about 12,400 housing units are not expected to be completed until December 2022.
• BPO’s assertion that broadband is available to 98.95% of the State is overstated as it’s based, in part, on Federal Communications Commission (FCC) Form 477 Broadband Deployment data. The FCC data has known limitations regarding broadband availability within census blocks as it considers an entire census block served if at least a single location within that block has broadband availability. (The FCC only requires the minimum download speed of 25 Mbps to consider a census block served.)

Key Recommendations

• Work with ISPs to complete outstanding projects as soon as practical.
• Ensure any future State-funded projects are based on reliable and accurate broadband availability data and utilize technologies providing reliable high-speed Internet.