The Business of Broadband

Last Wednesday marked the one year anniversary of the American Recovery and Reinvestment Act, which was passed by Congress on February 13th 2009, and signed into law by President Obama four days later. The total recovery package that passed was $787 billion, with 7.2 billion to be allocated to fund the improvement of nationwide broadband access.

As you might expect when dealing with a huge, bureaucratic program, it took a while for the money to start following. The initial stimulus from the program no doubt benefited attorneys and grant writers as local governments and providers of all types vied for stimulus dollars. The first award was finally announced by Vice President Biden ten months later, when an initial 183 million was doled out.

There were only a few awards in January, but more this month, with one award from RUS even being announced when DC was shut down due to snow. Just last week, the winners of 277 million in RUS funds were  announced, strategically timed to coincide with the one-year anniversary of the stimulus bill.  Still, we are a long way off from all of the funds being awarded by the September 30th deadline.

The fight for funds now continues into round two. The Notice of Funds Availability (NOFAs) for the second round of funding were announced in January, and applications are now being accepted.

Some of the things learned from the first round:

• A lot of the initial funding was heavily weighted toward middle-mile initiatives. This may have been to get work started on projects faster and to have a larger overall impact on more areas.
• Wired initiatives were much more prevalent than wireless, and fiber deployments seem to be the big winners so far.
• Telcos have been favored over cable companies thus far. This may be due to the fact that half the program is handled by the RUS, which has traditionally worked with telcos and utilities to bring broadband to rural areas. Companies that have applied for RUS loans in the past had a definite advantage.

The funding highlights in round two:

• $2.6 billion will be made available through NTIA’s BTOP program. Out of that, $2.35 billion will be allocated for infrastructure projects, $150 million for public computer center projects and at least $100 million for sustainable broadband adoption projects.   NTIA will put more emphasis projects that involve community ‘anchor institutions,’ like libraries, colleges/universities, and hospitals.
• RUS is making $2.2 billion available in the second round, and will emphasize last mile infrastructure projects. There are some sitpulations, as an area to receive funding must be at least 75 percent rural, and at least 50 percent of the premises must have no access to broadband service of 5 Mbps (upstream and downstream combined).

There were also some other changes in the second round NOFAs in response to criticism leveled at the first round process.

A couple of key changes in the application process:

• There are now separate NOFAs for the BTOP and BIP programs, which means you can make individual applications to each program. But, you are not allowed to submit substantially the same application to both. Applicants must determine the appropriate program to apply to based on the project.
• NTIA is collecting more data in the initial application, and with less reliance on follow-up information requests. They are also removing the requirement that infrastructure projects that connect anchor institutions be entirely located in unserved or underserved locations, although projects with those those designations will still receive more consideration.
• The RUS is requesting that all pertinent information be submitted with the initial application to streamline the process, and they eliminated the requirement to report census blocks.

Have you applied for funds?  If so, how did it go?  Feel free to comment.

Following are some helpful links for more information on the stimulus program and funding.

Broadband Stimulus Portal

NTIA Round 2 Guidelines

RUS Round 2 Guidelines