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In the End, "Not Enough Time" for Broadband Stimulus Reflection

March 17, 2009

By Gary Kim, Contributing Editor

Though its supporters will not like the analogy, there are so many questions, and so little time to make firm decisions, that the “broadband stimulus” programs will wind up being uncomfortably like the “stimulus bill” in general: “vote before you’ve read it.” The perfect should not be the enemy of the good, but there are too many public policy issues here to be adequately and reflectively addressed in the time that remains before June, when the first round of funds must be awarded: not “applied for,” but awarded.

To say it will be challenging for the National Telecommunications and Information Administration to begin disbursing $4.7 billion in new broadband project funds by June is an understatement. The Agriculture Department’s Rural Electrification Service likewise will be administering $2.5 billion in grants and loans to promote broadband services for “rural broadband,” and might face fewer policy concerns, but a staggering work load, nevertheless.

One obvious problem is that thousands or tens of thousands of applications now will hit agencies ill-equipped to process them. RUS has a staff of 130, about 24 working on the broadband stimulus program. Brad Ramsay, National Association of Regulatory Utility Commissioners general counsel, says he isn’t even sure the NTIA has even 130 people, total.

The two programs, which must by statute be coordinated, currently lack even a common application form, not to mention unresolved definitions of who may apply, who will decide, what the actual objectives are and what sorts of programs are most desired.

“We can argue about the process and points until the cows come home, but there is not enough time,” says Brad Ramsay, National Association of Regulatory Utility Commissioners general counsel. “So the first probable restriction for a joint application is to keep it simple.” And use an online submission process. “Submitting the stacks of paper is not going to make it easier for the agencies to coordinate on what's in there.”

He also suggests, for the sake of simplicity, focusing on grants, not grants, loans and loan guarantees. He recommends keeping a real-time list of applicants by state, city and locality, and “using the statutory text where possible.”

The same logic holds for reporting requirements. “There should be templates, a common template for reporting on both types of programs,” he says.

One possible solution for the expected flood of applications is to forward the proposals to the state level. “If they send it to the states, you will have people that are familiar with localities, with the infrastructure that's in the states that have kind of a jump-start as to whether this is a good or bad idea, and are in a better position to evaluate items,” says Ramsay.

But there are lots of questions. How did these two agencies work together? How can the money be spent in ways that do not conflict with each other? Can the two agencies use the same award criteria, application process, monitoring programs that might reduce some of the burdens and expedite the program?

Jeff Arnold, deputy legislative director of the National Association of Counties, says the idea of grants rather than loans is agreeable, and agrees the public-private partnership idea has merit. “We don't have a really good track record in municipal government sector in rolling out broadband but we know that we can partner and we think public/private partnerships are a critical element,” says Arnold.

Traditionally, RUS has awarded loans, or provided loan guarantees. NTIA can do that, but given the time constraints is likely to stick with grants. Grants likely are prefereable to loans, for obvious reasons, particularly for really hard-to-serve areas where there is likely no business case at all for a commercial service using normal investment criteria.

That won't be an issue for the NTIA program, but will pose some challenges for RUS.

Derrick Owens, director of government affairs for the Western Telecommunications Alliance, also thinks “grants should be the way both agencies go,” and favors reasonable audit and reporting processes that are not burdensome to grantees.

Common databases and information about submitted applications got universal support, though, at yet another scheduled public hearing to gather input for NTIA and RUS on fleshing out program rules, held in Washington March 16, 2009.

Gary Kim (News - Alert) is a contributing editor for TMCnet. To read more of Gary’s articles, please visit his columnist page.

Edited by Jessica Kostek

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In the End, "Not Enough Time" for Broadband Stimulus Reflection

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