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October 05, 2009

Broadband Stimulus: Cha- Cha- Cha Changes in NOFA Rule

By Craig Settles, Founder and President,

Some time this month, NTIA/RUS intends to issue an RFI (News - Alert) or “Request for Information” to gather input on rule changes, additions, deletions, and so on for the NOFA. This is likely your last best opportunity to impact the stimulus funding process. There’s a strong sentiment at the agencies to combine the last two funding rounds. 
In the RFI process expect serious jockeying for attention by incumbents who’ve decided they want to play in the sandbox after all, but not by rules that 2,200 other applications didn’t view as the kiss of death. Also anticipate lots of input from applicants still recovering from funding round 1. 
NTIA and RUS indicated they will have a strong hand in dealing with incumbent challenges. The rules for incumbents who want to submit a challenge are spelled out at their joint Web site, though you may have to read it a couple of times to fully grasp the procedure.
One new rule I believe should insist on is that the protections for applicants from incumbent challenges be written, not just verbal as they are currently. Furthermore, insist that applicants have a clearly written defense process to counter challenges, AND be able to see the “evidence” that incumbents submit for their challenges. Currently incumbents can hide evidence behind NDAs, making it harder for communities to defend against challenges
The net neutrality and open access rules need to be vigorously defended. Incumbents have just about lost their mind in a frenzy to stomp out what they perceive as this demon in their midst, so you know they’ll fight it in the next round of NOFA funding. Check out this column to see the importance between net neutrality and broadband stimulus.  
Several rules that seem pretty minor, but which have substantial impact, need common sense changes. For example, requiring online electronic filing exclusively is really silly considering that many of the areas with the biggest broadband need (grant eligibility) have no easy access to broadband for electronic filing. Duh! And if NTIA wants to have a bunch of attachments converted to .PDF format, allow people to format on their own, burn files to a CD and send by regular mail rather than spend days trying to do the conversion via Web software.
Several compliance rules need modifying too. Jeneba Ghatt of the The Ghatt Law Group points to one: “If RUS learns that the Awardee did not use the Loan and/or Grant exclusively for approved Project it may suspend payment/demand repayment.” The evolving nature of broadband means that, in a year or two, key elements of a funded proposal might need to change. Will communities be harassed to death on technicalities while trying to serve their constituents by leveraging best available technologies?
Likewise, hindering an awardee from selling or merging their business for 10 years flies in the face of tech businesses needs to pursue certain actions to ensure customers get best services. 
Thoughts from the Trenches
I asked some people who went through the NOFA fire for feedback on rule modifications.
“RUS should eliminate the ‘remote’ concept entirely and just worry about whether an area is rural,” says Paul Sinderbrand of Wilkinson Barker Knauer, LLP. “BIP should be focused on whether the applicant truly needs a large grant, not how far the proposed service area is from more populated areas.”
I think everyone who cares about broadband agrees wholeheartedly with Hunter Goosman, Gen. Mgr of ERC Broadband who says “increase the definition of broadband speed from 768 Kbps down and 200 Kbps up. If this is the minimum advertised speed then anyone offering DSL has met this obligation.” For that matter, anyone with dial up and a good ad agency could qualify.
As a practical matter, Mr. Goosman also points out, “the supporting documentation, especially the PDF documentation required by the government is inadequate. There is no chance of any applicant to offer substantial or complete information using the existing forms. Applicants are character limited.”
Freelance grant writer Alex Goldman and Larry Karisny, Director of ProjectSafety both make a point for a category of rules that need to be created. Too boost the economy it would be good to fund some projects in poor urban areas. Let’s face it, the way current rules are structured, urban areas are pretty much hosed. Yeah, poor neighborhoods are physically near broadband resources. But Philly and other big cities prove that if you live within the many blocks that incumbents avoid as completely as they avoid rural areas, Net access for those home may as well be on the dark side of the moon.
John Harris of Telecommunications Advisory Group states, “I understand the intent, but the self-scoring on the BIP is probably not helpful. How many applicants would score themselves down on their management’s ability? We all think we are geniuses! I also would eliminate all middle mile projects. If there is sufficient demand in the last mile, there will be sufficient return on capital for middle mile projects.”
Monique Dixon of the Siskiyou County (CA (News - Alert)) Economic Development Council believes the requirement for an attorney’s signoff on the proposal needs to go. “This requirement as written is for big companies that have attorneys on retainer. The County doesn’t have an attorney on staff. We took this to three outside firms and none of them would take the job because the rules would force them to take on particular liabilities.”
The rule requiring a professional engineer to sign off on the proposal is equally troublesome. It’s so vague you could probably get a biotech engineer to sign off on the document and be within compliance. States don’t all license engineers the same way. Either make the requirement easier to understand and reflective of the realities in the states, or get rid of it.
This is just the tip of the iceberg, but it’s a good starting point. The key takeaways are: keep an eye out for the RFI requesting input, and make your voice heard during this process.

Craig Settles helps organizations use broadband technologies to improve government and stakeholders' operating efficiency, as well as local economic development.

Edited by Michael Dinan