Commerce Secretary Howard Lutnick just slashed the $42.45 billion BEAD program in half. But that apparently wasn’t good enough for Sen. John Kennedy, the folksy Louisiana Republican whose Pelican State just got handed a check for $498.2 million from NTIA—down from an original $1.355 billion allocation.
Kennedy vented during a brief but pointed exchange with Lutnick, who was testifying Tuesday before the Senate Appropriations Subcommittee on Commerce, Justice, Science, and Related Agencies yesterday.
The hearing, ostensibly about BEAD funding and broadband deployment, was dominated by questions about Lutnick’s relationship with convicted sex offender Jeffrey Epstein. But Kennedy stuck to the money.
Here’s the exchange:
Kennedy: “Why don’t you just use satellite internet service? Why don’t you just use GlobalStar or Starlink? And you said the cost is $4,000 per person in Louisiana. For 600 bucks, you can buy a Starlink terminal. Why don’t you just do that? And do it across America and save a bunch of money.”
Lutnick: “The states were responsible for determining the best outcome, and sometimes fiber in a dense location can be economically better. Sometimes satellite does not work best.”
Kennedy: “It can’t be cheaper. That’s not possible. Can’t be cheaper.”
Lutnick: “Math? Math is, each of the states did their best. We worked it out with them, and we moved on.”
Kennedy: “I just don’t understand. You can buy… I’m not saying [Elon] Musk, [there are] others that just throw it out for a bit. But 600 bucks for a terminal versus $4,000 for fiber optic. I mean, for fiber optic? This is taxpayer money.”
Kennedy: “I’m done.”
The Numbers Behind the Frustration
Louisiana’s revised BEAD plan, approved by NTIA in November 2025, allocates approximately $498.2 million to connect 127,108 locations. Under the Trump administration’s “Benefit of the Bargain” restructuring, the state’s average cost per location dropped from $5,355 to $3,902—nearly a 30% reduction that saved roughly $857 million compared to the original Biden-era proposal.
But Kennedy’s math focuses on a different comparison: upfront hardware costs. A Starlink terminal retails for around $600, while fiber-to-the-home deployments in rural areas can run thousands of dollars per location when factoring in trenching, materials, and labor.
The revised Louisiana plan shifts the technology mix significantly. Under the original Biden-era BEAD guidelines, 95% of locations were slated for fiber. The restructured plan drops that to 81% fiber, with low-Earth orbit satellites (primarily Starlink) serving 8%, fixed wireless serving 6%, and cable or other technologies covering 5%.
Other Senators Pushed Back
Kennedy wasn’t the only one asking about technology choices, but other senators offered different perspectives.
Sen. Jeanne Shaheen, D-N.H., noted that satellite requires greater maintenance and has a shorter lifespan than fiber, changing the cost calculus over time.
Sen. Shelley Moore Capito, R-W.Va., pointed out terrain realities. “Does [Louisiana] have one mountain or valley in the state?” Capito asked. “You can drive down the side of one of our mountains and totally lose any kind of line of sight on a satellite pretty quickly.”
The Hidden Costs of “Cheap”
Kennedy’s focus on upfront costs versus long-term value mirrors debates that have played out in the wireless infrastructure industry. Fiber costs more upfront but lasts 30-50 years with minimal maintenance.
Satellite requires ongoing subscription fees (Starlink residential service runs $120/month), has latency issues for real-time applications, and depends on hardware that needs replacement every 5-7 years.
Weather can knock out service. Trees block the signal. And when 100 households in a rural area all try to stream Netflix at once, shared satellite bandwidth struggles.
What NTIA Changed
The June 2025 BEAD restructuring eliminated the program’s fiber preference, removed labor and workforce development requirements, dropped climate reporting mandates, and directed states to prioritize lowest-cost-per-location bids regardless of technology.
Lutnick touted Louisiana as a success story of the new approach, highlighting the $857 million in “savings.” But broadband advocates point out that those savings came from eliminating $500 million in non-deployment funds earmarked for workforce training, digital literacy programs, and economic development—programs Louisiana had planned to use to train 5,000 certified broadband technicians by 2027.
The original Louisiana plan committed $30 million specifically for workforce development in partnership with the Louisiana Community and Technical College System. That’s gone.
The $21 Billion Question
During the hearing, Subcommittee Chair Jerry Moran, R-Kan., asked Lutnick directly whether the approximately $21 billion in BEAD funds not allocated to infrastructure would be returned to the Treasury.
“That is not the plan,” Lutnick responded. “We are going to spend that money, that money you have appropriated, and we’re going to use the best ideas.”
But when pressed on what “best ideas” means, Lutnick was vague. He pointed to an NTIA request for input on non-deployment uses but offered no specifics on how states would access those funds or what restrictions might apply.
What’s Next
The NTIA has approved 50 of 56 state final proposals. Six remain in limbo. Louisiana has already signed its grant agreement and can begin drawing funds as soon as NTIA makes them available.
But “available” doesn’t mean “flowing.” Despite Lutnick’s promises that BEAD money would be “out the door” by end of 2025, not a single household has been connected under the program. States must still complete grant paperwork, finalize subgrantee agreements, and navigate environmental and permitting requirements.
However, the question isn’t just what fiber costs today—it’s what happens when you’re replacing satellite terminals, troubleshooting weather outages, and dealing with shared bandwidth constraints a decade from now.
