The Digital Equity Act is a 2021 federal law, passed as part of the Infrastructure Investment and Jobs Act, that authorized $2.75 billion in grants to help Americans who face the steepest barriers to using the internet get online, get devices, and learn to use them. The law created three grant programs run by the National Telecommunications and Information Administration (NTIA). In May 2025, the Trump administration terminated all three. The statute itself has not been repealed, and multiple lawsuits challenging the cancellation are pending as of early 2026.
Is the Digital Equity Act Still in Effect?
The law is still on the books. Congress authorized the programs through 2026, and the statutory text in Title 47 of the U.S. Code has not been amended or repealed. What has stopped is the administration of the programs.
On May 9, 2025, the U.S. Department of Commerce sent letters to states and grant recipients ending funding for the State Digital Equity Planning Grants and the State Digital Equity Capacity Grants effective immediately. Costs incurred after that date would not be reimbursed. The Digital Equity Competitive Grant Program was canceled as well. The administration’s position was that the programs were unnecessary, and the terminations were carried out through executive action rather than by Congress repealing the underlying law.
Two major legal challenges followed. In June 2025, more than 20 states filed a federal lawsuit arguing that the agencies unlawfully invoked an Office of Management and Budget regulation to terminate billions in congressionally appropriated funding. In October 2025, the National Digital Inclusion Alliance filed a separate suit in the U.S. District Court for the District of Columbia, arguing the unilateral cancellation violates the constitutional separation of powers between the executive and legislative branches. As of early 2026, no court has issued a final ruling either restoring or permanently blocking the funds. A ruling for the plaintiffs could reactivate the programs; a ruling for the administration could effectively end them despite the statute remaining law.
No new applications are being accepted. No new awards are being made. Funds that were spent before May 9, 2025 on approved planning work were reimbursable; obligations after that date were not.
The Three Grant Programs
The $2.75 billion was split across three separate programs, each aimed at a different type of recipient.1National Telecommunications and Information Administration. Digital Equity Competitive Grant Program Notice of Funding Opportunity
State Digital Equity Planning Grants
The smallest of the three, at $60 million total, funded states and territories to develop formal digital equity plans. Each plan had to document who in the state lacked digital access, why, and what the state intended to do about it. Producing an approved plan was a prerequisite for the much larger capacity grants that followed.
State Digital Equity Capacity Grants
Once a state had an approved plan, it became eligible for the State Digital Equity Capacity Grant Program under 47 U.S.C. § 1723, which distributed $1.44 billion by formula rather than through competition. Half of a state’s share was based on its share of the national population, a quarter on its share of the covered populations defined by the law, and a quarter on how far behind the state lagged in broadband availability and adoption compared with other states.2Office of the Law Revision Counsel. 47 USC 1723 – State Digital Equity Capacity Grant Program Each capacity grant carried a five-year performance period and was designed to support sustained implementation rather than one-time projects.
Digital Equity Competitive Grants
The third program, established under 47 U.S.C. § 1724, awarded $1.25 billion through a competitive application process open to a much wider range of organizations.3Office of the Law Revision Counsel. 47 USC 1724 – Digital Equity Competitive Grant Program The statute authorized $250 million per year for five fiscal years. Eligible applicants included local government agencies, tribal nations, nonprofits, community anchor institutions such as libraries and hospitals, local educational agencies, and workforce development organizations. An entity already serving as a state’s administering body for the capacity grants could not also receive competitive grants.
Applicants had to cover at least 10 percent of total project costs from non-federal sources.4BroadbandUSA. Digital Equity Competitive Grant Program FAQs Version 4.0 The statute set aside 5 percent of each year’s competitive funding for Indian Tribes, Alaska Native entities, and Native Hawaiian organizations; 1 percent for U.S. territories including the Virgin Islands, Guam, American Samoa, and the Northern Mariana Islands; and 5 percent for the NTIA’s own administration and technical assistance costs.3Office of the Law Revision Counsel. 47 USC 1724 – Digital Equity Competitive Grant Program
Who the Law Was Designed to Help
The statute defines eight “covered populations” that any digital equity plan or grant-funded project had to focus on. Grant recipients could not simply pick which groups to serve; every state plan and competitive application had to demonstrate how the project would address the specific barriers facing these populations within the applicant’s service area. Under 47 U.S.C. § 1721, the covered populations are:5Office of the Law Revision Counsel. 47 USC 1721 – Definitions
- Low-income households, meaning individuals in households at or below 150 percent of the federal poverty level.
- Aging individuals, defined as people 60 and older.
- Incarcerated individuals held in state, local, or tribal facilities. Those in federal correctional facilities are excluded.6BroadbandUSA. Digital Equity Act at a Glance
- Veterans.
- Individuals with disabilities.
- People with language barriers, including English learners and those with low literacy levels.
- Members of racial or ethnic minority groups.
- Rural residents.
The Census Bureau provided supporting data to help states identify where these populations are concentrated.7United States Census Bureau. Digital Equity Act of 2021
What Grant Funds Could Pay For
The statute limited spending to activities that directly advance digital inclusion. In practice that meant:
- Implementing an approved state plan, including staffing and administrative costs.
- Digital literacy training on skills like safe internet use, online banking, healthcare portals, and scam recognition.
- Purchasing and distributing laptops, tablets, and other hardware to low-income households.
- Subsidizing the monthly cost of broadband service for qualifying households.
- Establishing or upgrading public access points such as library and community-center computer labs.
What Digital Equity Means Under the Statute
The law defines digital equity as the condition in which individuals and communities have the information technology capacity needed for full participation in the society and economy of the United States.5Office of the Law Revision Counsel. 47 USC 1721 – Definitions That is broader than internet access alone. A household with a broadband connection but no computer, a senior with a tablet but no idea how to use telehealth, or a non-English speaker facing a government website with no translation option all fall short of digital equity as the statute uses the term. The grant programs were built to address each of those layers: infrastructure, devices, skills, and accessibility.
The Digital Equity Act is distinct from the Broadband Equity, Access, and Deployment (BEAD) program, a separate $42.45 billion initiative created by the same Infrastructure Investment and Jobs Act to fund broadband deployment. States were expected to coordinate the two, but they are different programs with different rules.
What This Means for Applicants and Recipients Now
For organizations that received and spent planning grant funds before May 2025, those expenditures were reimbursable. For states that had approved plans and were counting on capacity grant disbursements, the termination froze everything. Competitive grant applicants and recipients are in the same position. The pending lawsuits will decide whether obligated funds must be released, whether the programs resume, and how far executive authority extends to cancel programs Congress has funded. Anyone tracking a specific application, award, or state plan should follow the state coalition suit and the National Digital Inclusion Alliance case, since a ruling in either could change the answer overnight.