Broadband and Economic Development: How Deep is the Alliance?

News | NTIA-RUS Forums | Day 6, Sessions 3

WASHINGTON, March 25, 2009 – The final session of the NTIA/RUS public forums on implementing broadband stimulus legislation focused on the role that broadband deployment can play in economic development

Bob Atkinson of the Columbia University Institute for Tele-Information, and the moderator for most of the sessions in a marathon six days of public meetings by the Commerce and Agriculture Departments, set the session in motion by asking the panelists and public to “provide the NTIA and RUS with good ideas about how we promote community economic development through the broadband stimulus program.”

Commerce’s National Telecommunications and Information Administration (NTIA) and Agriculture’s Department’s Rural Utilities Service (RUS) co-sponsored the six days’ worth of joint meetings. Of the total, four days’ sessions were held in the Commerce Department’s auditorium, and two day’s worth were held in Las Vegas and Flagstaff, Ariz.

The topic of community economic development on Tuesday brought the jobs creation provision of the American Reinvestment and Recovery Act (ARRA) under the spotlight. It also brought out a diverse contingent of eight panelists.

The panelists were the U.S. Pan-Asian-American Chamber of Commerce, the National Rural Health Association, the National Emergency Number Association, Ronson Network Services Corp., the National Association of Development Organizations, the Rural Local Initiatives Support Corporation, the Communications Workers Of America and Argent Associates.

Much of the ideas offered by the panelists were long recitations of existing programs that might be leveraged. No good cause was left unheralded.

As was evident in the prior panels, panelists and questioners made passionate pleas to use contract law and administrative rule-making procedures to further their proposed interests in the allocation process.

Given the enormity of the topic and broad constituent base of the panelists, the public and participants struggled to make sense of the implications of ubiquitous broadband for community economic development.

No one advocated the phrase “build it and they will come,” but everyone agreed that a health care, emergency services and education were essential to attracting businesses to a community. Everyone agreed that broadband was essential. In other words, building-out broadband does not create certainty, it is merely necessary to be a viable economic contender.

Individuals familiar with implementing federally community economic development said that process and political inertia would establish reporting terms whose efforts would be judged by the number of jobs created.

The panelists offered several examples of existing models that could be used to make estimates.

No one asked if measuring the number of jobs created by broadband stimulus was a good idea. No one asked if existing jobs estimating models were even relevant to the new paradigm offered by ubiquitous broadband. It was taken as a given.

Small business concerns were vocal, especially disadvantaged small businesses. Their appeals for codifying small business participation in the grant and loan process appeared to include an assumption that standard procurement practices would govern the NTIA/RUS grants.

Additionally, no one addressed the schedule impact of sorting out North American Industrial Classification Codes (NAICs) and associated size standards. No one questioned whether the 8a certification for disadvantaged small businesses imposed constraints upon an owner’s net worth that would affect the ability of such a firm to draw the required capital.

The panel and audience were uncomfortable with the tension between quick economic job creation and careful community business development, which can take years to accomplish.

Success in community development is measured on a scale of two to ten years, and not 10 months to two years. Susan Au Allen, the national president of the U.S. Pan Asian American chamber of commerce summed it up well:

“Because long-term, to achieve community economic development in many of the communities across a very diverse rural America, this is going to be a patient process, and it takes a lot of time, and as the people at USDA know, since they have an active rural development program, you know, this is not something you can achieve overnight.”

The frenzied pace of stimulus leaves many concerned that “things will happen so fast that we will be left out,” said Allen.