Texas lawmakers are grilling state officials over broadband grant rules that, on paper, look tailor-made for Starlink. Records and testimony indicate the governor’s office pushed changes to how Texas hands out broadband money, and critics say those tweaks could steer a chunk of federal cash to Elon Musk’s satellite internet service instead of local fiber builders. The questions erupted in a tense state Senate oversight hearing where senators zeroed in on transparency and potential special treatment for low-Earth-orbit providers.
Governor’s office urged LEO-friendly rules, senators say
At the hearing, Broadband Development Office director Bryant Clayton testified that “the office of the governor asked us to look at how our proposed structure compared to other states,” according to KUT. Senators repeatedly pointed to what they called “favoritism” and said the office had boosted up-front payments for low-Earth-orbit satellite providers while turning down similar requests from fiber builders.
“Favoritism and transparency are real big concerns that have been brought to my office,” Sen. Charles Schwertner told the committee, per KUT. Schwertner, who chairs the committee, pressed Clayton on who asked for what, and when, as lawmakers tried to trace how the proposed rules tilted toward satellite bidders.
How BEAD’s rules opened the door for satellites
Federal changes to the BEAD grant program removed a previous preference for fiber projects and directed states to take a “technology-neutral” approach, a shift that made low-Earth-orbit satellite operators competitive for billions in federal money. The BEAD program is set to funnel roughly $42 billion to states for broadband expansion, according to the National Telecommunications and Information Administration, and analysts say those policy changes prompted aggressive lobbying by LEO providers.
Reporting has documented how satellite operators have pushed states to alter payment schedules so providers can get more money up front and access capital earlier in projects. That national fight over timing of payments has reshaped how many states evaluate BEAD bids, and Ars Technica has tracked the policy shift and its likely winners.
Local carriers warn they’ll be left behind
Rural and local fiber providers told senators they feel locked out as the Broadband Development Office adjusted disbursement rules to give LEO bidders more money at the outset of projects. Policy analysts say the change could divert durable state investments away from fiber toward satellite options that are faster to deploy but costlier to operate in the long run. The Benton Institute for Broadband & Society has warned about those trade-offs, noting that grant decisions today can shape which communities get robust infrastructure decades from now.
Small co-ops at the hearing argued that fiber builds bring local jobs, permanent infrastructure and backup capacity for emergencies that satellites cannot replace. They warned lawmakers that if the state leans too hard into satellite solutions, rural residents could end up with quick fixes instead of lasting networks.
Oversight, deadlines and what comes next
The Senate Business & Commerce Committee met on Wednesday, June 24 to review the Broadband Development Office’s strategic planning and funding decisions. The Senate schedule documents the meeting, and reporting describes the BDO director’s testimony and follow-up requests from lawmakers.
Committee Chair Schwertner followed up with a letter directing the office to provide an update by Aug. 1 and to deliver a new strategic plan by the end of the year, according to KUT. That puts the state office that manages billions for rural broadband under fresh scrutiny as legislators weigh whether to tighten rules, demand more detailed disclosures or let satellite providers compete for more awards under the current framework.
Texans in unserved areas could see internet service arrive more quickly if satellites win out, or they could face weaker long-term broadband quality if fiber projects are deprioritized. The committee’s review will help decide which path the state funds next and whether the governor’s office will have to defend its fingerprints on the rules.
