Blackburn Sets Groundwork for Broadband Infrastructure Package

USF is “a well-recognized and well-used mechanism,” Competitive Carriers Association President Steve Berry said. ”It’s a process that we’re familiar with.” He and other witnesses said USF could be improved. The Mobility Fund II should be “substantially enhanced,” Berry said: “If we can get the data correct, if they can actually get the numbers and knowledge of where there’s coverage and where there’s not.” Blackburn cited what she considers a lack of data tracking in the earlier Obama administration stimulus. “How do we avoid this kind of misdirection of funds?” she said.

Blackburn told us she anticipates the subcommittee taking legislative action on its measures after its work on NTIA and FCC reauthorizations, two priorities in her chairmanship. “We wanted to get through today and then we’ll kind of lay out that process,” she said. “I’m trying to do NTIA and FCC and then we want to get our bills in process, and probably do that ahead of anything infrastructure-wise.” She also plans to assess the five broadband-focused bills that Commerce Committee Democrats unveiled last week (see 1703160065), but hasn't decided how they may factor in: “I haven’t really looked at them yet. I’ll get to them.”

Subcommittee lawmakers showed a unified front in pressing for legislative action to spur broadband deployment, with emphasis on both sides of the aisle for more accurate mapping and overall support for the draft bills on siting and dig once under consideration (see 1703170065). They differed by party on what a bigger broadband infrastructure package should look like. Democrats pushed for more direct funding and lamented the lack of competition in the market. Republicans emphasized accountability.

Despite potential lack of bipartisan coordination on unveiling the two draft bills, the measures are “fine,” said subcommittee ranking member Mike Doyle, D-Pa. “But they don’t get at the real problem, which is that there isn’t a viable business case for investing in these regions. I was looking through some of the data submitted by CostQuest Associates from the second panel. Some members here have districts with as few as 11 percent of the households served by terrestrial broadband. Recent studies have also shown redlining in cities like Cleveland which have resulted in low-income communities being left behind while affluent parts of the city receive upgraded service” (see 1703100037).

“I stand ready to work with my colleagues to ensure that broadband is included in any infrastructure package that moves through Congress,” Commerce Committee Chairman Greg Walden, R-Ore., said in a written statement. “But as we look to expanding our national investment in broadband we cannot do so without reliable data.” He specifically to problems with USF. “Our committee should be taking the lead in conveying the sense of urgency that we should get moving,” said Rep. Peter Welch, D-Vt., complaining of the lack of infrastructure plan.

Managing Spending

Financing and execution of any spending were touchstones.

“Dollars and data” must be priorities, said Rep. Dave Loebsack, D-Iowa, who called broadband a “survival issue” for rural communities. Democrats repeatedly referred to the direct investment they thought was necessary. Commerce Committee ranking member Frank Pallone, D-N.J., invoked $40 billion, twice what Senate Democrats recommended in an infrastructure proposal this year (see 1703200067). Rep. Ben Ray Lujan, D-N.M., is developing draft legislation known as the Broadband Infrastructure Finance Innovation Act, he said. Lujan no longer is on the subcommittee, but joined the hearing. The measure would involve lines of credits and loan guarantees, said Lujan, whose spokesman didn’t provide further details.

“We have a real opportunity here” and "can get there,” Loebsack said in an interview. “Hopefully, the president will put rural broadband in his package as well, his infrastructure package. Obviously, a lot of it’s going to come down to the funding and how we do that. ... We’ve got to make sure that whatever data we have that the FCC is using to determine the mapping and who’s covered and who isn’t, that has to be accurate.” Direct funding may be required as part of the package, Loebsack insisted: “If it’s going to be funding that’s going to provide tax incentives or something that’s going to lean on the companies, you know, to go out and engage in this kind of investment, and if it doesn’t work for their business models, that’s going to be more difficult than if we provide funding from the federal government itself, as we have done in the past through the USF or as the case may be. I’m confident we can find that balance but we have to find that balance.”

“This is going to require more than tax cuts and deregulatory action,” said Rep. Doris Matsui, D-Calif., backing sustained investment during the hearing. Rep. Billy Long, R-Mo., said there's a need for “correctly identifying where broadband is needed before spending the money."

Rep. Anna Eshoo, D-Calif., wants to work with the subcommittee “to put a package together” to address all the different broadband issues holistically, she said. “Otherwise, I think all these parts, we’re going to have hearings on all the different parts. But we know in medicine, you need to treat the whole body.” She asked witnesses for top recommendations and suggested those be integrated. The committee needs to “advance this the way the Telecom Act was advanced at another time,” said Eshoo, former subcommittee ranking member. CCA’s Berry told her to focus on data, as did U.S. Cellular Chairman LeRoy Carlson. CTC Technology & Energy President Joanne Hovis pressed for a focus on public-private partnerships. Wireless Infrastructure Association Chairman Thomas Murray cited collocation as a needed focus.

Broadband “should be part of an infrastructure package” but “properly managed,” said Rep. John Shimkus, R-Ill. He anticipates “a bipartisan package that has some legs" and is glad to see the dig once bill back, he said.

Industry Comments

Industry representatives testified and wrote letters.

U.S. Cellular’s Carlson said funding for Mobility Fund Phase II should be increased. “It’s OK to see the problem as it really is,” he told lawmakers. Doyle focused on affordable backhaul, which Carlson conceded is a big challenge. “That’s a real barrier to deployment and we need to work on that,” said Doyle.

Tax credits are not enough, said CCA’s Berry, suggesting making USF funds nontaxable. State laws are frequently passed “supposedly protecting private sector opportunity when what they frequently do is tie the hands of local communities,” said Hovis, citing many communities that want to form partnerships “enabling private sector opportunity.” Shimkus warned that Congress should facilitate serving those with “a real need” and against pitting government money against industry incumbents. “It is imperative we learn from the mistakes of the past,” said Rep. Leonard Lance, R-N.J.

Industry officials supported the effort. The Satellite Industry Association wrote lawmakers, noting mapping and broadband interests. Congress needs to act, CTIA told lawmakers. The Telecommunications Industry Association backs the draft bills. Public Knowledge sent a letter urging focus on affordability. “In high-cost areas, broadband providers may not find it economical to build robust networks using private investment alone,” American Cable Association President Matt Polka wrote in a letter. “Here, government needs to provide support, but in doing so, it should ensure the areas are unserved and that support is distributed as fairly and cost efficiently as possible.” The National Rural Electric Cooperative Association was encouraged, a spokesman said. TechFreedom wrote backing the dig once draft and the Senate’s Mobile Now spectrum bill, which contains siting provisions similar to what the House worked on.