Hearing Of The Subcommittee On Communications, Technology, And The Internet Of The House Committee On Energy And Commerce - Oversight Of The American Recovery And Reinvestment Act: Broadband, Part Three

Statement

Good morning. Today the subcommittee conducts a third oversight hearing
regarding the $7.2 billion provided by the economic Recovery Act for broadband
programs. The programs are administered by the U.S. Department of Commerce
through the NTIA and the Department of Agriculture through its Rural Utilities
Service.

It is my pleasure to welcome this morning the NTIA Director, Assistant
Secretary for Communications and Information Larry Strickling, and Rural
Utilities Service Administrator Jonathan Adelstein, who will discuss the process
they have undertaken for awarding grants for the first round of funding and the
standards their agencies have developed that will govern the funding awards for
the second round.

The Recovery Act's broadband program presents an historic opportunity for
increasing the availability of broadband and elevating the standing of the United
States among developed nations in the percentage of the population that uses it.
How effectively these goals are achieved will be determined in large part by the
standards the agencies use to deploy the program's funds.

At our last oversight hearing, I expressed some concerns about the standards
that governed the first round of funding and encouraged the agencies to consider
modifying them prior to publication of the Notice of Funds Availability for the
second round.

I am pleased that the rules for the second round address those concerns. For
example, in the RUS program, grants of more than 50 percent of project costs are
no longer available only to communities that are deemed "remote," meaning that
the community is more than 50 miles from a city of at least 20,000.

That round one restriction had disqualified from major grants small isolated
communities throughout the eastern United States. I am pleased that this
remoteness test has been removed from the round two standards.

The rules for round two have also been changed so that rural applicants are
no longer required to first apply to RUS and be rejected before NTIA can make an
award to the applicant. And, I am pleased to note that in round two, RUS has
specified a measure of funding for satellite delivered broadband services.

I appreciate the agencies' responsiveness to our concerns and commend
them for these positive changes to the program rules.

I do want to offer a couple of suggestions for round two. First, I urge the
agencies to give round one participants whose applications were rejected guidance
sufficient to allow them to improve their applications for round two. For example,
round one participants cannot find out how many points winning applications
scored, so they currently don't know how close they may have been to receiving an
award. Many round one applicants may have been on the cusp of receiving an
award, and it would be helpful for them to know that fact and receive guidance on
how to improve their applications for round two.

I also urge the RUS to give serious consideration to granting waivers of the
requirement that projects cost no more than $10,000 per home passed. Many areas
without access to broadband today are among the most difficult and expensive to
serve due to terrain and the distances over which infrastructures must be built. A
key purpose of the broadband grant programs is to deploy high-speed Internet
service to those areas. Without waivers many deserving rural projects will be
denied funding.

I commend the NTIA and the RUS for the tremendous work they have done
on the broadband grant programs to date. The agencies have had to create
programs out of whole cloth and begin to make awards in a very short timeframe,
and they are doing good work. The administrators and staff have our thanks for
that performance.

Mr. Strickling and Mr. Adelstein, thank you for joining us this morning. I
look forward to your comments on these and other matters.

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