House committee substitute to the 2nd edition makes the following changes.

Amends the percentage of initial Federal Broadband Equity, Access, and Development Program (BEAD) grant funds that the Department of Information Technology (DIT) may use for the listed purposes in SL 2021-180, as amended, as follows: (1) decreases the percentage that may be used for grant planning purposes from up to 3% to up to 1% and (2) decreases the percentage that may be used for administrative purposes from up to 2% to up to 1.5%. Authorizes DIT to use up to the actual amount of federal funds received for any Digital Equity planning funds.

Amends GS 143B-1337 (the Information Technology Strategy Board [Board]) to change the Board chair from the State Chief Technology Officer (CIO) to a Chair elected by a majority of the Board members. Provides for a one-year term for the Chair. Prevents the State CIO or any employee of DIT from being elected to serve as chair. Clarifies that the statute should not be deemed to extend the powers and duties of the Board to the areas of broadband mapping, broadband services, or any of the broadband deployment programs set forth in GS Chapter 143B’s article on DIT or otherwise established by State law or administered by DIT.

Requires DIT to develop and establish a formal challenge process that conforms with BEAD federal regulations and guidance for broadband programs. Requires DIT to solicit input from stakeholders and to consider the adaptability of the challenge process to fit existing State broadband grant programs and anticipated requirements related to federal programs. Requires DIT to submit a report outlining the formal challenge process and any legislative recommendations to the specified NCGA committee and the Fiscal Research Division by December 1, 2023.

Makes organizational changes. Makes conforming changes to act’s effective date.