SENATORS SAY FARM BILL COULD CREATE $750 MILLION IN BROADBAND LOANS
Senate 64-35 approved farm bill conference report that would provide $100 million in rural broadband loans and loan guarantees from 2002 to 2007. Bill had moved slowly in 107th Congress due to controversy over several agriculture and nonfarm subsidy provisions. Although $100 million total for broadband infrastructure deployment initially had been proposed for distribution each year, conference compromise would allot: (1) $20 million for each of fiscal years 2002 through 2005. (2) $10 million for each of FY 2006 and FY 2007. Despite reduced total for Rural Utilities Service (RUS)-administered program, several senators said funds would benefit underserved rural areas. Sen. Dorgan (D-N.D.) said Wed. on Senate floor that in light of unparalleled success of past RUS telecom loan programs, combined with Treasury rate of interest, $20 million annual authorization could be leveraged into “broadband loan program of at least $750 million a year.”
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Senate Agriculture Committee Chmn. Harkin (D-Ia.) agreed with Dorgan, despite Harkin’s concern with what he called “mysterious process” by which Office of Management & Budget determines subsidy rates for federal loan programs: “The RUS telecommunications loan program has not suffered a loan loss [and] over its [50-year] life… [has] made money for the government… Given the record of the agency, and given the Treasury interest rate of interest assumption… $20 million in direct budget authority provided could generate a minimum level of $750 million a year.”
Harkin and Dorgan said measure not only would spur deployment of wireline, wireless, cable and satellite broadband infrastructure, but also would aid advances in each of those technological areas. Conference report defined broadband as technology “having the capability to transmit data to enable a subscriber to the service to originate and receive high-quality voice, data, graphics and video.” It would order Secy. of Agriculture to, “from time to time as advances in technology warrant, review and recommend modifications of rate-of-data transmissions criteria for purposes of the identification of broadband technologies.” Harkin said: “In this context, technological neutrality should not be used to preclude progress in any given technology. For example, what is broadband in a fixed setting may be different than what is broadband in a mobile wireless setting. In both cases, the measure of the broadband capability should be based on the capability of the network, not the individual devices used to access the network.”
Communities eligible for broadband funds must have 20,000 or fewer residents. Priority would be given to eligible areas where broadband currently wasn’t available, although regardless of availability, entities already controlling more than 2% of U.S. phone subscriber lines wouldn’t be eligible. State and local govt. could get grants if “no other eligible entity is already offering, or has committed to offer, broadband services” in their respective jurisdictions.
It would provide $80 million in rural local TV broadcast signal loans. House proposal had originally proposed using segment of funds to deploy 2 satellites to bolster rural availability of local TV signals, but that provision was dropped. Additionally, measure would provide $30 million annually through 2007 for rural telework initiatives, including $5 million to create and support Rural Telework Institute.
Conference report also would provide $360 million over 6 years to Agriculture Dept. to develop an e-commerce program to “expand and enhance electronic practices and technology to be used by small businesses and microenterprises in rural areas.” Development grants would be distributed in annual disbursements of $60 million to 4 regional rural development centers. Colleges and universities with agricultural or rural development programs would be eligible to compete for grants. Potential recipients would have to agree to obtain from “nonfederal sources” an amount matching at least 50% of the grant funds as condition of receipt. Matching fund requirement could be reduced to 25% of “if the grant recipient serves low-income or minority owned businesses or microenterprises.”