Business leaders are touting the signing of a broadband bill today as a step in the right direction while they await final action on a measure that would provide funding to help expand high-speed internet to underserved areas of Iowa.

Gov. Kim Reynolds signed House File 848 this morning. The measure calls for Empower Rural Iowa grants to be made to broadband providers to expand service statewide.

The bill sets up three grant tiers with various upload and download speed requirements that companies can apply for to extend service to sparsely populated areas of the state.

Funding for that expansion would come from the state’s general fund and be administered through the Empower Rural Iowa grant program.

Reynolds had proposed $450 million over the next three years to expand high-speed internet statewide. The House passed a bill that would appropriate $100 million in the first year for broadband expansion. The Senate has not acted on broadband funding, which has been wrapped into the larger state budget bill.

The budget bill is on the Senate calendar for debate and could be voted on anytime between now and the end of the session, which is scheduled for Friday, the last day lawmakers will receive their per diem. With several measures still to be decided, it seems unlikely the Legislature will adjourn by that deadline.

Among bills still waiting for action are those addressing child care and housing.

Joe Murphy, executive director of the Iowa Business Council, said although it’s less than the governor requested, $100 million is a huge improvement in efforts to deliver high-speed internet across Iowa.

“It’s significantly more than the state has ever appropriated before for this type of project, so this is a huge improvement from where we have been before,” he said.

Murphy said there was never the expectation that Reynolds’ proposal would be the full source of funding for broadband expansion, and that other sources would need to be sought. One of those  is the federal infrastructure package being debated in Washington, he said.

Dustin Miller, executive director of the Iowa Chamber Alliance, said the importance of expanding high-speed internet has clearly been brought into focus during the past year.

“With COVID, this need across the state was exacerbated,” he said. “It was always there, but we’ve all just figured out just how very important it was.”

He said the level of upload and download speeds has been adjusted through various negotiations at the Statehouse, which have focused on residential needs.

“We really tried to push for the top-level speeds to ensure we were future-proofing this for commercial and industrial applications,” Miller said. “The governor started off with 100 [megabit upload speeds] and 100 [megabit download speeds].”

The lowered speeds included in the bill signed today are in tiers of up to upload and download speeds of 25 megabits per second, between 25 and 50 megabits per second, and between 50 and 80 megabits per second.

Miller said internet service can be a challenge for rural communities, where some communities can be as low as 6 megabits per second.

“So getting from 6 to 25 or 6 to 50 is a big deal, so we were always sensitive to that conversation which shows the difference between the purely commercial looking at this versus the residential,” he said.

It’s also just as big an issue in urban areas as rural, Miller said.

“With COVID and people working from home and schooling from home, we found a lot of situations where we had urban deserts just as much as you find rural deserts,” he said.

Miller said it’s unclear if the Senate will approve funding at the same level as the House, but said he didn’t see agreement being reached this week, sending this year’s session into next month.

Murphy said the importance of expanding broadband, a top priority of the Business Council, the Iowa Chamber Alliance and other statewide business groups, can’t be overstated.

“This investment really represents the future of capabilities of our state, not just in the way we do business but how we do health care, how we educate children, how we interact with each other socially,” Murphy said. “This is hugely important for the future trajectory of Iowa.”