Panelists at Las Vegas Broadband Forum Seek Local 'Skin in the Game'

News | NTIA-RUS Forum | Day 2, Session 3

March 19, 2009 – A leading official at the Commerce Department’s National Telecommunications and Information Administration pled with panelists in Las Vegas as he urged them to provide constructive selection criteria for the agency’s evaluation of broadband grant applicants.

Speaking at the Charleston Heights Arts Center on the May 17 public meeting on broadband grants – the second of six days of such meetings – Mark Seifert, senior advisor to the Assistant Secretary of Commerce made sincere and passionate pleas for ideas that would allow NTIA to sort out a pending deluge of grant applications.

In his role as panel moderator of the “Selection Criteria” panel on Tuesday, he compelled the panel and audience to engage.

”You tell us how we should judge all these applications,” he said, nothing that was “one of the most important panels we’ll have [and] the most difficult because we have so many different things that we have to try and figure and achieve.”

For example, he asked: “How would you in a competitive way rank proposals one over the other to decide how we should spend the money?”

As with the Monday meeting in Washington, the Tuesday public meeting in Las Vegas was conducted jointly with the NTIA and the Agriculture Department’s Rural Utilities Service. It was also webcast on the Internet, with as much as 143 viewers registering on the system’s counting mechanism.

The panelist represented four so-called “middle mile” service providers and a representative of the Nevada System of Higher Education. Middle mile providers provide high-speed internet connections between residential neighborhoods and the high-capacity fiber backbones that traverse the county and the world.

”When we originally put this panel together, I thought we were going to have a much more diverse kind of background,” Seifert said, “which underscores the difficult task we have before us.”

Jason Lazar of Keyon Communications offered the following “guiding principles that will help with the task at hand:”

•    Creation of a comprehensive grading scale that measures both quantitative and qualitative characteristics across applications.
•    An evaluation of the applicant itself. Is this applicant credible? Can it do what it says?
•    Speed. How quickly can this project be deployed? Projects that can be completed swiftly should be prioritized.
•    Is a particular proposal broad or narrow in scope? While neither should be precluded, the criteria need to address both types.
•    This is about broadband deployment, broadband penetration, and job creation. Make sure that this is where the funds are going.

Ed Anderson of the Nevada System of Higher Education offered the following observations on selection criteria:

•    Viability and sustainability
•    While desirable, partnering with commercial service providers should not be a requirement.
•    Open and competitive access with strict guidelines and severe penalties for denial or delay of equal access.
•    The projects demonstrate a greater contribution to the overall good.
•    The number of jobs potentially created has to be factored in here somehow.
•    The last priority would be blanket broadband. It’s inefficient and it’s very hard to monitor success.

Don Jackson with tri-county telephone in Basin, Wyoming, answered the question with more questions:

•    For consumers, how many people are going to be affected by what we’re doing here? Whether dealing with he the provision of broadband service to a group, or to individuals, how many people will be affected?
At what cost? What’s it going to cost? As Jackson reads the statute, cost should probably be woven into the equation.
•    What bandwidth is going to be provided?
•    Public benefit: to what degree will the project that’s being proposed impact hospitals, education, public safety, and the low income community?
•    To what extent will this particular project contribute to economic development?
•    We need to make sure that recipients can and will deliver.

Having summarized some successes in Wyoming, Jackson stated with confidence: “build it, and they will come,” a mantra met with skepticism throughout the entire public hearing.

Cathleen Moyer of Pioneer Communications had a longer list of proposed selection critera:

•    Applicant’s financial stability, especially where grants and loans are concerned.
•    Local presence, or a promise thereto.
•    The degree to which upgrades cost less than new build-out
•    Total number of end users impacted per geographic unit.
•    The implementation time table with preference for “shovel-ready” initiatives
•    Emphasize middle mile infrastructure.
•    The degree to which access is guaranteed to middle lime trunks
•    The degree to which the solution is expandable
•    Other benefits impacting education, economic development, and purchasing American-made services and goods.

Moyer repeatedly said that Pioneer had made good use of universal service funds for sustainable capital investments.

Mark Feest of CC Communications in Fallon, Nevada, jumped in and stayed focused on the notion of recurring cost, a constant undercurrent in the public meeting.

Feest’s message was less scripted. ”As opposed to one-time costs…, the criteria for making grants needs to take [into account] the sustainability of the business model.”

The public comment session was spirited, as questioners probed the language of the statute, drilling-in on the minimum critical specification as shaped by the verbs “shall” and “may.” Feest admonished to “find something that’s reputable, that’s open, that meets all of the requirements of the statute…. The statute is your best guidance. I would go very carefully by the words in it.”

After this comment, Seifert said, “I think Congress is going to be very happy to hear that they always like us to do exactly what they say.”

Two of the speakers were very concerned that large business interests might simply come to town, install some equipment, collect their pay, and move-on. Those observations caused the panel to reiterate what had been said about “local presence” in markets benefiting from grants.

Seifert followed up by commenting that the 20% matching contribution is intended to ensure that awardees have some “skin in the game.”