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April 20, 2007
How Do the Feds Fund Broadband? Let Me Count The Ways
Perhaps the real question to ask about the so-called “digital divide,” isn’t how to address it, but whether it exists at all, at least when it comes to rural telecommunications.
Universal service came up during two policy sessions at the National Conference of State Legislatures' Spring Forum in Washington this week. And comments and presentations left me wondering to what extent rural America was “underserved.”
During Friday’s session “Local Competition in Local Telecommunications: Do Americans Have a Real Choice?” (as an aside: all the evidence presented points to the answer as a resounding “Yes!”), Brian Ford, policy analyst for OPASTCO, the trade group that represents some 520 small rural telcos, said some 90 percent of its membership is offering broadband Internet. And that group of 90 percent makes broadband available to 90 percent of their customers. In addition, half of the OPASTCO membership is offering wireless services and half (not necessarily the same or opposing half) are offering video.
True, much of this is due to subsidies, but not all, as attendees learned Thursday during “Delivering Broadband: Technology Options, Costs and Funding.” Although the bloated Federal Universal Service Fund most often comes to mind, there’s almost no end to the federal government’s bounty in funding approaches, as Len Kruger of the Congressional Research Service, showed during his presentation.
First there’s the Rural Utilities Service at the U.S. Department of Agriculture, which oversees two federal assistance programs exclusively (Kruger’s emphasis, not mine) dedicated to broadband. One program is the Rural Broadband Access Loan and Loan Guarantee program, which has $500 million banked for 2007. To be eligible, a rural community must not be contained in an incorporated city or town with a population greater than 20,000. Eligible entities are corporations, co-ops, Indian tribes or public bodies.
The RUS also oversee the Community Connect Broadband Grant Program, which has allocated $9 million so far in 2007. To be eligible, a corporation, co-op, tribe or public body must serve a single community of 20,000 or less and must provide free broadband to area schools and libraries for at least two years.
These programs are on top of other general federal programs from various departments (HUD, Commerce, Homeland Security, Education) that can be tapped to fund broadband. These include The USF’s High Cost Program, Schools and Libraries Fund and Rural Health Care Fund, but also:
Rural Telephone Loans and Loan Guarantees
Community Development Block Grants
Indian Community Development Block Grants
Grants for Public Works and Economic Development Facilities
The Appalachian Regional Commission
The Delta Regional Authority
The Denali Commission
Distance Learning and TeleMedicine Program
Interoperable Communications Equipment Grants
Telehealth Network Grants
Public Telecommunications Facilities Program
Technology programs overseen by the Department of Education
Library grants
Medical Library Assistance
I offer this list to counter those who say the government is not doing enough to address broadband in the rural areas of the country. Clearly the programs are there. If there is a shortfall of rural broadband (a debatable proposition), it’s not whether there are enough funding programs, it’s whether these programs are truly effective in getting money where it needs to be. One way or another, however, given that broadband penetration is growing, as is private investment and competition, the task going forward is to manage and reduce these loans and subsidies, not create more.
Posted by steve.titch at April 20, 2007 11:41 AM
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