Will Private Companies Be Able to Bid for Broadband Stimulus Funds?

Lots of people seem to very interested in the $7.2 billion in "broadband stimulus" funds the NTIA and RUS will be awarding. But there are some very big caveats. With one little exception, only non-profits are, by statute, allowed to apply. And there is some possibility that unless an entity already has in the past gotten a grant from RUS, it might not be well positioned to apply under the RUS rules, either.

And though RUS and NTIA are holding lots of hearings, there remains more uncertainty than clarity.

At a March 16 National Telecommunications and Information Administration hearing, presenters said about what you would expect them to say about bidding rules for the upcoming round of NTIA and U.S. Department of Agriculture Rural Utilities Service "broadband stimulus" grants, loans and loan guarantees.

A service provider representative suggested service providers should be able to apply. "NTIA should extend eligibility to any existing entity that holds an FCC license, state certificate of public convenience and necessity, cable franchise or similar

government authorization or who is otherwise providing broadband service under applicable federal and state law," said Curt Stamp, president of the Independent Telephone and Telecommunications Alliance.

"No additional or individual review of any such entity should be required"Curt Stamp, president of the Independent Telephone and Telecommunications Alliance.

A representative of the Communications Workers of America urged that service provider entities be given "priority" so long as projects proposed by such entities have endorsements from non-profit entities specifically named in the legislation.

"Priority should be given to entities that add substantial infrastructure and focus on unserved areas," said Debbie Goldman, Communications workers of America telecommunications policy director. "An applicant should be required to demonstrate that it has the financial, technical, managerial, and operational qualifications to complete the project in timely manner, and then it has the capacity to continue operating after stimulus funding is no longer available."

"Past performance shall be a strong consideration to determine the applicant's qualifications," Goldman argued.

The New America Foundation representative argued that telcos and cable companies should not be given special priority, but rather "the types of eligible private entities we must support must go far beyond usual suspects," said Sasha Meinrath, New America Foundation Open Technology Initiative research director. That's what one would expect from an entity in favor of open access.

Betty Ann Kane, chairwoman of hte District of Columbia Public Service Commission, emphasized the need to consult with state and political subdivisions including state public utility commissions, state broadband authorities and state service administrative agencies. "Private firms or sole proprietorships or individuals should be considered eligible when those entities act in partnership with any of those state entities."

Grant Seiffert, Telecommunications Industry Association president, argued that focusing on eligibility is the wrong focus. "NTIA should not focus on what type of entity an applicant is but rather on, one, to the value the proposed project to the American people and two, the applicant's ability to use the funds to achieve the project's objective."

Seiffert said he does not "believe that this program can be successful and meet the goals set by Congress and the administration without private parties being involved."