FCC, USDA Promote Rural Broadband Loan Program
FCC and Agriculture Department officials are promoting a $1.5 billion federal loan and grant program for telecom infrastructure, broadband and distance learning projects in rural communities. The funding comes from money provided in the resolution that funds the government through March 6 that Congress passed in September. The FCC and USDA began in February promoting the programs, which had similar funding in FY 2008, starting with a joint Web site and four workshops planned throughout the country, the last set for Nov. 20 in Phoenix.
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More than 100 people have signed up for the free Phoenix workshop, a USDA spokeswoman said Tuesday. It will explain the mechanics of applying for loans and grants, as well as the different technology platforms for broadband services, said an FCC release Tuesday. Attendees also will get information on the universal service program, the FCC’s Rural Health Care Pilot program and wireless spectrum access, the commission said. Officials are hoping in particular to reach Native American populations that often have limited access to broadband services, an agency spokeswoman said.
“Broadband is now considered less of a luxury and more of a necessity,” said a survey released Tuesday by the National Telecommunications Cooperative Association. The group’s annual survey said nearly all respondents reported offering broadband services, defined as 200 kbps, compared with only 58 percent who did so in 2000. Services include DSL, the most widely offered, fiber to the home, cable modem and satellite.
Dial-up subscribers declined while broadband rose “significantly” in the past year, said the survey. About 93 percent said they faced competition from other advanced services providers, it said. Competitors typically include two national Internet service providers, two satellite broadband providers, two wireless Internet service providers and a cable company. But “future uncertainty” over regulation and universal service revenue streams are inhibiting plans for fiber deployment, respondents said.
The FCC has long focused on promoting rural broadband services, an agency spokeswoman said. It teamed up with USDA at the beginning of the year to host the workshops. The publicity comes at a time when fewer applicants are competing for the funds (CD Sept 8 p6), with the government turning away almost as much money in broadband loans as it handed out in FY 2008 in the broadband loan program. According to a USDA brochure prepared for an Oct. 15 workshop in Northampton, Mass., that agency approved 13 applications worth $438.5 million in FY 2008, but it “returned” $441.8 million in applications, the brochure said. Nine applications are under review for $79.4 million in broadband loans.
Applications are returned because loan requesters either didn’t qualify or failed to provide sufficient information, the USDA said. The Massachusetts workshop, sponsored by Sen. Ted Kennedy, D-Mass., and separate from the four joint FCC- USDA efforts, described changes in the broadband loan program implemented in the farm bill, which included a more targeted definition of “rural” and slightly easier borrowing terms. One change calls for a pre-qualification process to allow applicants to find out if they qualify before filling out lengthy and complex paperwork. Also, the equity or credit support level for borrowers was lowered from 20 percent to 10 percent of the loan value.
An interim rule outlining the rule changes will be published in mid-December, said USDA Outreach Coordinator Mary Camponola. The USDA already was working on changes to its broadband loan and grant programs when Congress passed the farm bill, which incorporated some of the proposed changes and added new ones, Camponola said. Last week, the agency announced it approved $462 million in broadband and telecommunications loans to 19 communications firms serving 19 states. That follows a September announcement of $342 million to 18 companies in 21 states. The funds come from the FY 2008 budget, a USDA spokeswoman said.