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05.18.16

Brave new world: HUD proposed broadband installation and climate change planning requirements

Economists, educators and social critics concur that lower income families lack access to the internet.  Without that access, those families are literally disconnected from employment, educational, commercial and entertainment opportunities that other Americans now take for granted.  HUD announced several initiatives today to close that “digital divide” and to compel local agencies to actively plan for the impacts of climate change and natural risks on occupants of low- and moderate-income housing.

First, with respect to several HUD-funded programs (including Section 8, HOME, CDBG, project-based vouchers and others), HUD proposed regulations to require installation of broadband infrastructure in all new construction or substantial rehabilitation.  The nature of that infrastructure is open-ended and can take the form of new internet cabling, coaxial television cables that can carry internet signals, and even wireless connectivity.  “Substantial rehabilitation” is defined to include “significant work” on the property’s electrical system, equal to or greater than 75 percent of the cost of replacing the entire electrical system, or overall rehabilitation of the project where the cost is equal to or greater than 75 percent of the replacement cost of the property.  HUD would allow some exceptions to this requirement if the owner can demonstrate that the location of the property, the cost of the installation, or the building structure makes installation infeasible.

The Broadband proposed rule is being created against the context of HUD Notice 96-19, the longstanding guidance about utilizing telecommunications in HUD assisted Multifamily properties.  This Notice is, of course, antiquated and speaks to what is today old technology. Also, it was created at the time to address a budding industry for entering into easements or other forms of legal rights to install and operate systems, and in some cases exclude other providers.

Similarly, this rule is coming out in the context of other guidance seeking HUD approvals for cell towers and satellite dishes, and also Federal Communications Commission rules allowing residents to install their own broadband equipment. 

In addition, HUD proposed another set of regulations to compel states and local housing agencies that prepare Consolidate Plans to incorporate planning for expanding broadband access and to address “natural hazard risks,” including the consequences of climate change, to low- and moderate-income families.  Largely, the proposal focuses on expanding the range of groups that those agencies consult with (including broadband service providers, schools, and flood control and emergency management agencies, among others).  Agencies will also have to incorporate other data sources, such as broadband availability data, climate change projections and similar environmental information when drafting Consolidated Plans, and are encouraged to develop strategies for hazard mitigation and resilience in those plans.  We have already seen projects where flooding linked to ground subsidence and rising sea levels have jeopardized multifamily properties and became an issue for maintaining a project-based Section 8 HAP contract.

The proposed regulation requiring broadband installation for new construction and substantial rehabilitation was published at 81 Fed. Reg. 31181.  The proposed rule for incorporating planning for broadband access and natural hazard risk in Consolidated Plans was published at 81 Fed. Reg. 31192.  Comments on both rules are due on July 18, 2016.