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NTIA, Agriculture and FCC Officials Detail Broadband Stimulus Funding Programs

WASHINGTON, March 11, 2009 – President Obama’s commitment to using federal funds for improving broadband deployment inched closer to reality Tuesday as the federal agencies responsible for implementing stimulus funding urged creativity and speed in submitting applications for grants.



WASHINGTON, March 11, 2009 – President Obama’s commitment to using federal funds for improving broadband deployment inched closer to reality Tuesday as the federal agencies responsible for implementing stimulus funding urged creativity and speed in submitting applications for grants.

Speaking before a packed auditorium at the Commerce Department, agency Acting Chief of Staff Rick Wade, Secretary of Agriculture Tom Vilsack, and acting Federal Communications Commission Chairman Michael Copps provided a high-level overview of Obama’s commitment to broadband, and to the $7.2 billion in broadband stimulus funds.

The real action on Tuesday, however, came as four day-to-day officials at the National Telecommunications and Information Administration, the Rural Utilities Service and the FCC answered dozens of questions from among the hundreds of lobbyists, consultants, advocates and broadband users seeking to understand the grant-making process.

They attended in person, through a teleconference, or through a webcast of the session.

Speaking to this crowd, NTIA Associate Administrator Bernadette McGuire-Rivera said, “I see a lot of familiar faces, and I know that each of you, in your own way, would like to see more and better broadband.”

“It is going to happen very fast,” said McGuire-Rivera, a senior career official at NTIA, and the head of the Office of Telecommunications and Information Applications. “Everyone needs to work together.”

She was referring not only to the fact that the NTIA must coordinate its broadband stimulus activities with the Agriculture Department and with the FCC, but that broadband bidders should seek to pool their applications for the sake of administrative convenience.

Under the broadband provisions of the fiscal stimulus measure, signed into law on February 17, NTIA will hand out $4.7 billion, with at least $2.5 billion to be disbursed by the Rural Utilities Service of the Agriculture Department. The FCC will craft the national broadband strategy required under the law.

NTIA Rule-Making Process

Together with NTIA Senior Advisor Mark Seifert, who has been tapped to head up administration of the agency’s broadband stimulus program, McGuire-Rivera walked through the 12-page notice of rule-making. Seifert is a former FCC official and Democratic staffer to the House Energy and Commerce Commission

Under the broadband stimulus law, up to $350 million may be spend on creation a national broadband map, at least $250 million must be spend on programs that encourage “sustainable adoption of broadband,” and at least $200 million must be spend on grants for public computer centers.

The documents covers a lot of ground on each of these programs, from the purposes of the grant program to the role of the states, eligibility requirements, mechanics, definitions, financial contributions, and details about particular program areas.

Released late Monday, and scheduled for official publication in the federal Register, the notice of rule-making also outlines six additional public meetings: on March 16, 19, 23 and 24, with field hearings to be held in other locations on March 17 and 18.

At the meeting, the NTIA announced that the March 17 meeting will be held in Las Vegas, and the March 18 meeting will be held in Flagstaff, Ariz.

NTIA officials said Tuesday that these six public meetings – the themes of which will be announced this week – are to take the place of private, ex parte meetings.

A February 24 Federal Register notice said that the NTIA would hold private meetings. But the agency was quickly swamped with requests.

“We had over 2,000 people [seeking] meeting requests,” said Seifert, who joked that it would take until 2012 just to hold those meetings. “We have moved to this process, to get folks to come to consensus.”

“The time pressure is such that we really have to move quickly, and we have to get best ideas,” he said.

Seifert and McGuire-Rivera outlined two statutory deadlines: all money must be spent by Commerce and Agriculture by September 30, 2010. Secondly, grant awarded must be “substantially compete” within two years.

Banking on Broadband

Agriculture Secretary Tom Vilsack kicked off the speeches. He said, “This an important day for rural America. We are here today to begin the process of a dialogue and how best to invest in America’s future.”

He apologized for having to leave the meeting after his speech, and said, referring to broadband, “This is a very important technology that every American needs to have access to.”

Acting FCC Chairman Michael Copps said that the United State now ranked 17th in global broadband penetration, as measured by the International Telecommunications Union. “Too few consumers and small businesses in this country have the high-speed broadband they need,” he said. “We pay too much for service that is too slow.”

“Now, thanks to the vision of the president and the foresight of Congress, we are doing something about it,” Copps continued. “The years of broadband drift and growing digital divides are coming to an end. We begin to understand how key broadband infrastructure is to the future of each and every one of us.”

Rick Wade, Commerce Department senior advisor and acting chief of staff – and currently the highest-ranking official at the department – provided an overview of the importance of broadband to President Obama.

“Both Commerce and USDA’s broadband programs represent a critical component of the administration’s broader economic recovery program,” said Wade. These investment must connect to other stimulus spending – including investment in transportation infrastructure, a “smart grid,” and health information technology.

“Whenever the president addresses the path toward our economic recovery, he never fails to mention the importance of broadband infrastructure access, and there is a reason,” said Wade, referring to the benefits that broadband can provide to farmers, public safety officials, health care, and others.

Question and Answer Session

The question-and-answer session, which took up more than half of the 90 minutes allocated to the public meeting, producing an outpouring of questions, and some answers from Seifert, McGuire-Rivera, David Villano, Assistant Administrator for Telecommunications Programs, USDA Rural Development, and Scott Deutschman, Acting Senior Legal Advisor to Copps.

Applications for grants may apply for either or both the RUS and the NTIA grants – provided that, if an applicant were awarded grants from both entities, the funds from the separate agencies may not be used for the same project said McGuire-Rivera.

Each agency will dole out its respective funds through three separate window of time.

NTIA will issue its first “notice of funds availability” in the April to June of 2009 time frame, said McGuire-Rivera. The second round would be between October and December 2009, and the third round between April and June 2010. Applicants that are declined in the first round may resubmit their applications in the second and third rounds, she said.

Unlike the Technologies Opportunities Program a previous grant program administered by the NTIA, the broadband grants will not be channeled through a state funding mechanism.

Instead, grant applications – including consortia of applications – are “all going to be competitive grants, with published selection and evaluation criteria,” she said. Additionally, the law requires that, to receive funding, it must e the case that the project would not have been implemented but for the grant.

Among the criteria to be evaluated by the NTIA, she said:

  • There must be at least one grant in each state.
  • Will it increase affordability, and subscribership, of broadband?
  • Will it provide the greatest broadband speed to most users?
  • Will it provide benefits for health care, for education and for children?
  • Whether or not the applicant is a socially and economically disadvantaged small business.

Rural Utilities Service Rules

RUS has not determined  its first “notice of funds availability” window, said Villano, but it would likely be within 60-90 days. “We want to get the next one out as soon as we can,” said Villano, adding that he expected the window to be between three and four months each.

In some ways, RUS may have a head start on NTIA, because the RUS has an established procedure for making broadband loans, pursuant to the farm bill of 2002.

Unlike the farm bill, the $2.5 billion allocated to the RUS by the broadband stimulus legislation may be used for grants, too. But the agency has the discretion to leverage grant money into a larger pool of funds available for loans, and RUS may do that, said Villano.

Still, 75 percent of the funds disbursed by the RUS must be within rural areas that do not have sufficient access to broadband.

Breakfast Media LLC CEO Drew Clark has led the Broadband Breakfast community since 2008. An early proponent of better broadband, better lives, he initially founded the Broadband Census crowdsourcing campaign for broadband data. As Editor and Publisher, Clark presides over the leading media company advocating for higher-capacity internet everywhere through topical, timely and intelligent coverage. Clark also served as head of the Partnership for a Connected Illinois, a state broadband initiative.

Broadband's Impact

After BEAD Letter of Credit Changes, Work Still Remains, Advocates Say

Group who pushed for LOC changes are looking to ensure state contracts work well with performance bonds.



Photo of the webinar Thursday.

WASHINGTON, November 9, 2023 – There is still more work to do on BEAD program financing requirements, advocates and broadband providers said on Thursday.

“Now the work kind of begins again,” said Quinn Jordan, head of the Mississippi Broadband Association.

He and other stakeholders pushed the Commerce Department to change the letter of credit rules for its $42.5 billion Broadband Equity, Access and Deployment program.

Before November 1, BEAD rules required a 25 percent letter of credit, which advocates said would edge out smaller providers. The updated rules allow states to use other means of confirming the financial viability of projects, like performance bonds, which are only paid out if a project fails,  and reimbursements based on deployment milestones.

But going forward, work will center on making sure state contracts are compatible with the other frameworks allowed in the changed rules, those advocates said at a webinar in the broadband community.

“If there’s too much exposure, we could really run up the cost of these performance bonds,” Jordan said.

Phil Macres, a telecom lawyer who organized a coalition of broadband providers to push the letter of credit changes, said he has been meeting with surety companies – institutions that issue performance bonds – to work on how best to structure these contracts.

The second biggest focus will be ensuring state broadband offices know how to navigate the updated financing rules, said Calum Cameron, a communications manager at Connect Humanity. Cameron drafted a 300-signatory open letter advocating changes to the old letter of credit rules. 

“This group will continue to work on both of these fronts,” he said. 

Working for letter of credit changes

The rule change took months of advocacy work behind the scenes, said Gigi Sohn, the longtime broadband advocate and one-time FCC nominee who now heads the American Association for Public Broadband.

“If anybody tells you this is an issue that was just brought to the attention of the NTIA,” she said, “it’s been much longer than that.”

Panelists credited Sohn’s involvement with some of the effort’s success.

“As soon as Gigi Sohn got involved, that’s when the issue really started to take hold.” said John Windhausen, director of the School, Health, and Libraries Broadband Coalition.

That, Mindhausen said, made it easier to set up meetings in August with White House officials and express concerns that the original letter of credit requirements were too restrictive.

Charles Thomas, director of operations at two small ISPs, said he reached out to Macres and Elizabeth Bowles, another panelist who serves as CEO of the ISP Aristotle Unified Communications, after hearing them speak about the BEAD letter of credit at a webinar.

He eventually sat down with them and NTIA Director Alan Davidson to explain how the old rules would have left him and other small ISPs on the sidelines.

“You got to get involved,” he said.

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NTIA Will Allow Alternatives to Letter of Credit for BEAD Funding in New Guidance

The new guidance allows performance bonds and takes other measures to include smaller providers.



Photo of money from

WASHINGTON, November 1, 2023 – The National Telecommunications and Information Administration released on Wednesday alternatives to the letter of credit requirement for its main broadband program.

The $42.5 billion Broadband Equity, Access and Deployment program rules require grant recipients to produce a letter of credit from a bank for 25 percent of the amount they are awarded. That involves putting the cash up as collateral, which critics have said could prevent small broadband providers from participating.

With the NTIA’s new ‘conditional programmatic waiver,’ states and territories will have other options to ensure the financial reliability of BEAD grants. Those include requiring a performance bond for the full award, which the awardee only pays out if they fail to meet their build out requirements. 

The waiver allows states and territories to use completion milestones to lower LOC amounts over time, meaning the LOC could decrease from 25 percent of the grant as infrastructure is deployed, freeing up money for grant recipients to use in their BEAD projects. That option can also apply to performance bonds.

The agency is also doing away with the 25 percent starting point, allowing the LOC to be as low as 10 percent under certain circumstances, as well as accepting letters of credit from credit unions.

In a blog post announcing the waiver, the NTIA said it may provide additional guidance on the matter in the future and emphasized that broadband offices can work with the agency to deviate from the standard rules.

“States and territories are also free to request waivers for additional circumstances not covered by this programmatic waiver,” it said. 

States will outline the letter of credit rules for their BEAD grant processes in volume two of their initial proposals, due to the NTIA by December 27.

The move comes after months of pressure from the broadband industry and lawmakers to change the BEAD letter of credit requirements. Small providers argued they would be edged out of the program because they have less cash on hand, hindering efforts to close the digital divide in remote and hard-to-serve areas.

BEAD director Evan Feinman first hinted the agency was working on an update to the requirement at the BEAD Implementation Summit on September 22.

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Broadband's Impact

Commerce Subcommittee Advances Bills on NTIA Spectrum, AI Oversight Reauthorization

The bills go to the full committee for votes.



Screenshot of Rep. Cathy McMorris Rodgers, R-WA, at the markup Wednesday

WASHINGTON, July 12, 2023 – The Subcommittee on Communications and Technology on Wednesday advanced several pieces of legislation to reauthorize the National Telecommunications and Information Administration’s oversight on matters including spectrum management and artificial intelligence after it was last reviewed in 1992.

The Spectrum Relocation Enhancement Act proposed in May by Rep. Doris Matsui, D-CA, revises the Spectrum Relocation Fund, which compensates federal agencies to open spectrum bands for commercial use. The legislation would provide federal entities more flexibility in their evaluation of spectrum for sharing or relocation, especially in light of recent worries about the difficulties of obtaining spectrum licenses for commercial needs due to limited supply.

Another bill to pass the markup was the AI Accountability Act, introduced in May by Reps. Josh Harder, D-CA, and Robin Kelly, D-IL, which would require the NTIA to examine accountability standards for AI systems used in communications networks. The bill is part of a wider push to enhance the transparency of government’s use of AI to communicate with the public.

 The subcommittee also approved the Diaspora Link Act to assess the feasibility of a trans-Atlantic fiber cable connection between the United States, the U.S. Virgin Islands, Ghana, and Nigeria as well as other key recommendations to consolidate broadband funding programs, develop a national strategy for closing the digital divide and educate the public on cybersecurity issues.

“A lot has changed in the last 31 years, both in the technology sector and at the NTIA,” said Rep. Cathy McMorris Rodgers, R-WA. These legislations would further enforce the NTIA as the “representative of the US in the international telecommunication forum,” she added.

These pieces of legislation are pending full committee votes before proceeding to the floor.

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