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Trump Administrations Unveils Details of Infrastructure Incentives, Including Spending on Rural Broadband

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WASHINGTON, February 12, 2018 – President Donald Trump on Monday unveiled details of his plan to spur $1.5 trillion in new investment to revitalize the nation’s crumbling infrastructure with a combination of $200 billion worth of matching funds and block grants to be funded from to-be-determined budget savings.

“We’re going to get the roads in great shape,” Trump said. ” Washington no longer will be a roadblock to progress.”

The specifics of the plan, detailed in a 55-page legislative outline, largely match the details of a widely-reported document outlining the proposal’s “principles,” which outline initiatives to reduce the time it takes to complete the federal permitting process for infrastructure projects, and sets out several different programs under which the $200 billion in funding.

The $200 billion in funding is being paid for through budgetary savings rather than from a dedicated funding stream like increasing the gas tax, which funds the federal highway trust fund. The funds will be distributed to states and localities, in keeping with the Trump administration’s desire for local control of infrastructure spending.

Plan includes an ‘Infrastructure Incentives Program’

Broadband projects will be eligible for the plan’s “Infrastructure Incentives Program.” –This portion of the fund will account for $100 billion in spending, or half of the promised $200 billion. It will be made through matching funds to be distributed to states and localities.

The administration’s thinking has been that state and local officials, rather than the federal government, best understand their communities’ infrastructure needs.

According to the White House outline, the program “would provide for targeted Federal investments, encourage innovation, streamline project delivery, and help transform the way infrastructure is designed, built and maintained” by distributing matching grants to the jurisdictions to which the grants are awarded under agreements in which the applying jurisdictions would lay out “express project milestones.”

Distribution of the funds would be conditioned on whether or not the progress of those projects meet the agreed-upon milestones within identified time frames.

Wide class of infrastructure projects would be eligible under the program

A wide-ranging class of infrastructure projects would be eligible for grants under the incentives program, for which applications would be solicited every six months, and under which funds would be distributed by the United States Department of Transportation (DOT), United States Army Corps of Engineers (USACE), and Environmental Protection Agency (EPA).

Eligible projects would include work on “surface transportation and airports, passenger rail, ports and waterways, flood control, water supply, hydropower, water resources, drinking water facilities, wastewater facilities, stormwater facilities, and brownfield and superfund sites.”

Projects already underway would also be eligible if they began during a three-year “look-back period,” which would be defined as “the time preceding the project sponsor’s completed application during which the new revenue generation was implemented.”

Broadband projects will be eligible for funding under two other parts of the plan

Broadband projects will be eligible for funding under two other parts of the Trump plan, specifically the Rural Infrastructure and Transformative Projects programs.

Broadband projects can be funded through the plan’s Rural Infrastructure Program – to which $50 billion will be allocated – will direct funds to rural states. The funds will be distributed through a statutory “rural formula” which will be calculated “based on rural lane miles and rural population adjusted to reflect policy objectives.” The formula will set out a statutory minimum and maximum amount of funds to which each rural state will be entitled.

During the White House infrastructure roundtable, Trump took a moment to acknowledge the need for infrastructure improvements in rural America, and lamented that in years past, “the rural folks have been left out.”

The vast majority of the $50 billion – 80 percent of it – will be distributed in the form of block grants to be controlled by the governors of recipient states, who will have discretion as to the kinds of projects the grants will go toward. Still, they will have to consult with designated federal agencies depending on the kinds of projects they choose to fund and state directors of rural development.

The remaining 20 percent will be allocated to Rural Performance Grants within eligible asset classes, according to specified criteria to be determined.

Tribal government programs, and ‘transformation projects,’ will also be eligible for funding

Tribal governments will be able to receive a portion of the funds which will be specifically set aside for them and distributed by the Secretaries of Transportation and the Interior through the Tribal Transportation Program. A process will be created in consultation with the various sovereign tribal governments. The needs of U.S. territories such as Puerto Rico, Guam and the U.S. Virgin Islands. will be addressed through dedicated funding as well.

The Transformative Projects program – for which $20 billion will be allocated – is also envisioned as a funding source for broadband projects, and will provide both funding and technical assistance for “bold, innovative, and transformative infrastructure projects that could dramatically improve infrastructure,” according to the White House.

The plan defines “transformative projects” as those for that will have the effect of “significantly improving performance, from the perspective of availability, safety, reliability, frequency and service speed; substantially reducing user costs for services; introducing new types of services; and improving services based on other related metrics.”

This program, the White House outline claims, would “fundamentally transform the way infrastructure is delivered or operated” by funding projects that are “ambitious, exploratory and ground-breaking project ideas that have significantly more risk than standard infrastructure projects, but offer a much larger reward profile.”

The $20 billion in funds will available under three separate tracks – demonstration projects, project planning and capital construction — be awarded by a selection committee to be composed of representatives of relevant federal agencies and chaired by the Secretary of Commerce after applications for funding are reviewed by interagency evaluation panels “comprised of individuals from the applicable [f]ederal agencies.”

Awardees would enter a partnership agreement with the federal government, which would specify the terms and conditions of the awards.

In addition to funding, applicants for the Transformative Project Program can also seek technical assistance from the federal government.

Not the first foray into broadband for rural America

The programs announced Monday are not the Trump administration’s first foray into making broadband more available to Americans living in rural areas, the importance of which has been previously acknowledged by the president himself.

In January 2018, Trump addressed the American Farm Bureau convention in Nashville, Tennessee, and signed two executive actions meant to facilitate rural broadband deployment Another previously-announced rural broadband initiative announced by the Trump administration intended to explore the use of federally-owned “dark fiber” – fiber that has been laid but is not currently in use – in order to interconnect and provide service to underserved communities.

Positive reaction to the Trump administration plan from FCC Chairman Ajit Pai

The open-ended nature of the Trump plan – which accounts for the lack of dedicated funding for broadband projects – is a marked departure from the approach taken in his predecessor’s major infrastructure legislation, the 2009 American Investment and Recovery Act.

Envisioned by the Obama administration as an economic stimulus to jump-start the nation’s economy after the 2008 financial crisis, the Recovery Act took several steps to increase broadband deployment in both urban and rural areas, and in doing so, close the digital divide, through the expenditure of $7.2 billion in loans and grants by the Departments of Commerce and Agriculture.

While the Trump infrastructure plan in theory makes a combined $60 billion available which could be used for broadband projects, none of the funds are set aside for such projects.

FCC Chairman Ajit Pai praised the plan in a statement Monday, calling it “a welcome and strong call to action.”

“Too often, regulatory barriers make it harder and more expensive to build out broadband than it needs to be – to the detriment of American consumers,” Pai said. “I stand ready to work with the administration and Congress to turn this plan into a reality as we continue to bridge the digital divide and extend 5G digital opportunity to all Americans.”

Different approaches to broadband infrastructure from Obama and Trump

Even though the Trump plan appears to give short shrift to broadband projects when compared with his predecessor’s, a White House official told BroadbandBreakfast.com that the lack of specificity is a feature rather than a bug in keeping with the president’s desire to put the maximum amount of control in the hands of state and local officials.

The president’s plan makes a point to shift away from dictating from Washington what communities must spend federal infrastructure dollars on,” the official said. “So while there will be dedicated funding for rural areas in the package, it is not specifically required to be used for broadband.”

The official again stressed that the decision to not specifically direct any funding under the plan to increase broadband deployment doesn’t indicate a lack of interest on the part of the Trump administration. “We envision there being no limit to how much of the rural funding can be spent on broadband,” the official said.

(Photo of rural road by Max Pixel used with permission.)

Andrew Feinberg is the White House Correspondent and Managing Editor for Breakfast Media. He rejoined BroadbandBreakfast.com in late 2016 after working as a staff writer at The Hill and as a freelance writer. He worked at BroadbandBreakfast.com from its founding in 2008 to 2010, first as a Reporter and then as Deputy Editor. He also covered the White House for Russia's Sputnik News from the beginning of the Trump Administration until he was let go for refusing to use White House press briefings to promote conspiracy theories, and later documented the experience in a story which set off a chain of events leading to Sputnik being forced to register under the Foreign Agents Registration Act. Andrew's work has appeared in such publications as The Hill, Politico, Communications Daily, Washington Internet Daily, Washington Business Journal, The Sentinel Newspapers, FastCompany.TV, Mashable, and Silicon Angle.

FTC

Biden Looks to Bedoya to Replace Rohit Chopra on FTC, Report Says

Staunch privacy advocate Alvaro Bedoya appears to be Joe Biden’s pick for the FTC, Axios reports.

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Staunch privacy advocate Alvaro Bedoya appears to be Joe Biden's pick for the FTC

WASHINGTON, September 13, 2021—President Joe Biden is expected to bring on privacy stalwart Alvaro Bedoya for the open seat on the Federal Trade Commission, according to reporting from Axios.

Born in Peru and raised in New York, Bedoya attended Harvard University where he received his B.A. in Social Studies. He also holds a J.D. from Yale.

A longtime supporter of consumer privacy rights, Bedoya is the founding director of the Center on Privacy and Technology at Georgetown Law. Previously, he served as chief counsel of the Senate Judiciary Subcommittee on Privacy, Technology, and the Law. While working in the Senate, much of his work centered on location and biometric privacy with regard to consumer protections.

As it stands now, there are three Democrats and two Republicans on the commission. In January of 2021, Biden tapped Rohit Chopra to serve as the Director of the Consumer Protection Bureau. Though Chopra’s term on the FTC expired in 2019, the commission allows incumbent members to sit until a replacement is appointed—in this case, Bedoya.

The Washington Post quoted Republican FTC commissioner Noah Phillips speaking fondly of Bedoya. “I don’t think of him as a person who just gets up and rants about entities he doesn’t like,” and described him as “without fail as bright and thoughtful a person as you could find.”

Phillips has been broadly critical of the direction he feels the FTC is going and has historically criticized political firebrands on both sides of the aisle.

As Big Tech faces mounting criticism from both Republicans and Democrats with regard to privacy, misinformation, and alleged censorship, Bedoya will be entering a tumultuous era for the FTC.

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Antitrust

FTC Commissioner Phillips Warns About Shifting Direction of Agency

Noah Phillips voiced concern about the scope and practices of the Biden administration’s FTC.

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FTC Commissioner Noah Phillips

WASHINGTON, September 2, 2021 — Federal Trade Commissioner Noah Phillips said at a Hudson Institute webinar on Monday that he’s concerned about the direction the competition watchdog is moving toward considering recent events.

Phillips said the left-leaning voices in Washington and the appointment of Lina Khan to chair the agency has left him wondering about the legacy of the last 40 years of competition regulation in America – which have been hallmarked by the Hart-Scott-Rodino Antitrust Improvements Act of 1976. That legislation effectively gave the FTC the ability to review mergers and acquisitions before they were finalized, rather than afterward, which governed pre-legislation.

Under Biden-appointee Lina Khan, Phillips described how the FTC has done away with the process of early termination. In the past, this process made it unnecessary for every single company to provide advanced notice and advanced approval for mergers. “Historically, parties have been able to come to the agencies and say, ‘You’re not interested in this, can we just go ahead and finish our deal,’ and the agencies have said ‘yes.’”

He said this is no longer the case, and that every single merger must provide advanced notice and approval. “What we’re introducing is an inefficiency in the market for transactions that we have no interest in pursuing, just for the sake of it. I think that’s a problem,” he continued. “My concern is that it is making merger enforcement less effective, less efficient, and less fair.”

Phillips pointed to left-of-center and leftist voices in Congress, such as Rep. David Cicilline, D-New York, Sen. Elizabeth Warren, D-Massachusetts, and Rep. Alexandria Ocasio-Cortez, D-New York, who, at the outset of the pandemic, wanted to ban all acquisitions and mergers—regardless of their merit. He described this view as falling outside of mainstream perspectives, but noteworthy nonetheless.

“I don’t think that is what most people believe,” Phillips remarked. “I don’t think that is what Hart-Scott-Rodino envisions.”

This webinar took place only a couple of weeks after Phillips spoke at the Technology Policy Institute’s 2021 Aspen Forum, where he voiced similar concerns, stating that he feared that this new direction would make it more difficult for the FTC to hear cases that it should, and defended the commission’s record against critics who said it was lax under the Trump Administration.

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Antitrust

Experts Say Congress’s New Antitrust Package is Philosophically Flawed and Politically Motivated

Antitrust and technology experts say that Congress’s new antitrust package is legally flawed and politically motivated.

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Pool photo of Lina Khan from April 2021 by Graeme Jennings

June 18, 2021—The package of five new antitrust bills introduced last Friday would “radically change how firms compete,” said a critic close to the technology industry.

The comments, by Aurelien Portuese, director of antitrust and innovation policy at the Information Technology and Innovation Foundation in an interview with Broadband Breakfast, represent a sharp critiques of the bills by legal experts and tech industry executives.

The bills would not achieve their stated goals, Portuese said. He says that they would stifle competition and lead to less, not more innovation.

Portuese said that, because the bills target companies above a certain market cap and would only apply to those companies, they would lead to “a two-level playing field” in which the laws would apply to certain companies and not to others.

“These bills allow practices for some companies while prohibiting the very same practices to their rivals, and conversely, would prohibit some practices to some companies while allowing them for rivals.”

Because the measures were drafted to target a specific companies such as Apple, Amazon, Facebook and Google, they were a form of “overt discrimination.”

Apple will be regulated by the new laws, but their competitor in the music streaming industry, Spotify, will not. This would give Spotify a competitive advantage over Apple.

Antitrust law should be used to foster innovation

Antitrust policy should be employed to foster as much innovation as possible, and not simply break up large firms into smaller ones, said David Teece, executive chairman of the Berkeley Research Group, to an online panel hosted by ITIF.

For his part, Portuese said that antitrust law is a “question of leadership, not of law.” Currently, there are three active legal cases employing antitrust philosophy involving Google, Facebook, and Apple, all of which, he said, are being prosecuted under the current antitrust law.

These current antitrust tools are sufficient, he said, and the lack of antitrust actions taken by past administrations is a problem of enforcement, and not the legal framework itself.

Lina Khan, a longstanding critic of Big Tech, was appointed chairwomen of the FTC on Tuesday. As chairwoman, she will have considerable leeway in directing how and what the FTC regulates. That could mean a major shift in the commission’s enforcement on antitrust.

Portuese also made the point that tech innovation requires large capital expenditures. By specifically targeting the U.S.’s top firms and breaking them up, the overall amount of innovation that occurs in the technology industry will diminished, he said.

Enforcement for political gain

Samuel Palmisano, the former CEO of technology company IBM, said that he sees the new antitrust legislative proposals as less about competition policy and more about politics.

“We see both the right and the left wanting to break up media and social platforms because they don’t like what’s being published, or not published,” Palmisano said at the ITIF event. “There can be a legitimate debate about media fairness or Section 230, but antitrust isn’t the tool for that debate.”

Editor’s Note: A previous version of this story incorrectly spelled the last name of Federal Trade Commission Chair Lina Khan, as “Kahn.” The story has been corrected, and Broadband Breakfast apologizes for the error.

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