TMCnews Featured Article

October 28, 2009

Broadband Agencies Receiving Scrutiny Over Grant Delay

By Kelly McGuire, TMCnet Editor

After federal officials announced that the broadband stimulus grant awards are now pushed back until December, acts disappointment and criticism received about the additional delay shouldn’t come as a surprise. 

With over 2,200 companies awaiting their piece of the $7.2 billion stimulus funding pie, two U.S. agencies – the U.S. Rural Utilities Service, or “RUS,” and the National Telecommunications and Information Administration, or “NTIA,” – with the heavy task of distributing this money over the next year heard complaints from an upset U.S. senator. 

Additionally, other senators complained that the RUS had eliminated many rural areas that are not serviced from eligibility. Taking a contradictory stance, some senators noted that the RUE has funded broadband projects where service already existed in the past.

These conflicting opinions are just some of the scrutiny the RUA and NTIA are facing as they attempt to distribute the first round of broadband grants and loans, totaling $4 billion.  

In March, a report was released which proved that RUS, since Sept. 2005, loaned over $913 million to 37 applications for broadband deployment under a different program.

Senator Claire McCaskill said that she hopes the federal money doesn’t pose competition for people who’ve invested without federal assistance, saying it’s unfair to those private investors and companies. 

Additionally, RUS administrator Jonathan Adelstein said his agency was working to find the right definition for geographic areas eligible for the new funding, approved in the American Recovery and Reinvestment Act, a huge economic stimulus package.

However, three other senators complained that the RUS, in defining “remote” areas eligible for a targeted grant program as those that are 50 miles outside cities, was leaving out large areas now unserved by broadband.

Senator Mark Pryor, an Arkansas Democrat, said that there are large sections of Arkansas that aren't covered by broadband, but only a couple of areas that would be eligible for the remote grants. 

In response, it seems the RUS is trying to rectify the issue, by trying to rework the definition of remote areas, for which $400 million is set aside for last-mile projects.

“It turns out maybe we went too far, and a lot of West Virginia wasn't counted and a lot of Arkansas wasn't counted,” Adelstein said. “Our goal is, I think, shared, which is that those funds reach the hardest-to-reach areas.”

Kelly McGuire is a TMCnet Web editor, covering CRM and workforce technologies, and anchor of its daily TMC Newsroom video broadcast. Kelly also writes about eco-friendly �green� technologies and smart grids, compiling TMCnet�s weekly e-Newsletters on those topics, as well as the cable industry. To read more of Kelly�s articles, please visit her columnist page.

Edited by Kelly McGuire