StimulatingBroadband.com 01-27-2010 San Francisco - An important Subcommittee of the U.S. Senate Appropriations Committee opens its oversight hearing of the Commerce Department's portion of the $ 7.2 billion broadband stimulus program tomorrow morning, January 28th.
Given the forward rushing events that define the program, the following is our list of critical directives which the Subcommittee and other appropriate Committees on the Hill need to give to the 2 Departments - Agriculture, and Commerce - charged with managing the $ 7.2 billion program.Yes, we know our civics and constitutional law about how specific legislation needs to be crafted to 'direct' the Executive to do anything. Hopefully that is why the people holding the power of the purse, on Senate Appropriations, are having a hearing. Powerful Committees of Congress often suggest things that mere agency mortals ignore at their peril.
Unless these items are implemented by the appropriate agencies (NTIA and RUS) immediatley, broadband stimulus applicants will not have the needed information nor time to make rational decisions about how to apply for and spend public dollars. The risk of programmatic waste, fraud, and abuse -- a risk already reported to Congress by the GAO -- will escalate.
Frankly, the list is tedious, longer than it needs to be, and more detailed than it should be. It is so given that general pledges of "a fully, open and transparent process" don't cut it any longer. Even those pledges made by agency chiefs in congressional testimony haven't been carried out. More pledges, more promises, won't work. Only action taken by Congress at this point will work.
Congress should order the two Departments, and their applicable agencies (NTIA and RUS), to:
1. Direct the Publication of an Immediate Round I Application Pipeline Update
In no venue has either agency released any coherent information about how many applications in total have been moved into the due diligence phase by gross counts, let alone by each program (BIP vs. BTOP), or by each project category (Middle Mile, Last Mile, Public Computer Centers, Sustainable Adoption). Some media reports have given scattered information, when some of us are able to nail done some numbers, numbers which quickly go out of date as the Round I award cycle progresses.
Confirmed information has been so difficult to determine that an Editor at GigaOm, one of the nation's leading tech sector publications, could not account for the program's total appropriations as Round I's first awards were announced.
The Update should be changed daily as pre-due diligence phase rejections, due diligence phase rejections, and final awards are made.
2. Direct A Minimum 30-Day Period Between Round I Final Awards and the Round II the Applications Filing Deadline
As per current confirmed media reporting, based on attributed statements from official agency spokespeople, there will be only a 2 week window between the time all Round I awards are announced and the Round II application filing deadline. The rules of both agencies explicitly state that (leaving aside allowable minor 'overlap areas') no Round II proposed service area will be eligible if a Round I award was made for the same territory.
As recently pointed out by the online publication Fierce Broadband Wireless, two weeks is simply not enough time to target proposed areas and write a legitimate application for them, based on the Round I award information. This is particularly true of the large scale middle mile projects, with their Comprehensive Community Infrastructure (CCI) requirements directed by the new NTIA rules (BTOP NOFA).
No one can seriously believe that 2 weeks is sufficient time to target a service area and write a legitimate application, especially since as broadband fiber advocate Geoff Daily points out the experience of Round I providers and public sector entities demonstrates that the application process can span into months of time and tens of thousands of dollars.
3. Direct A Minimum 30-Day Period Between The Public Release of Data, As Specified Below, and the Round II Applications Filing Deadline
Given the inability or unwillingness of the agencies to release transparent data needed for program transparency, Congress needs to direct that a 30-day standstill period occur after the agencies have finally released their information, and prior to the Round II application filing deadline. The agencies need to be given a disincentive for continued noncompliance with what should be a transparent approach to the spending of public funds.
The Government Accountability Office (GAO) has already reported to Congress that the tight time frames and present lack of adequate national broadband mapping "may pose risks of waste, fraud, and abuse." (Report: .PDF) Continued withholding of what should be public data by the agencies only increases these risks.
4. Direct the Immediate Release of All State (Gubernatorial) Recommendations to NTIA Made in Round I
Despite the efforts of several of us in the sector, 6 - 10 states and territories still have refused to release for public inspection the recommendations made by state and territorial governors to NTIA for Round I projects. This critical information needs to be made public immediately by NTIA, without acceding to further foot dragging by a handful of recalcitrant governors, at least some of whom could care less about broadband in their states to begin with.
5. Direct the Immediate Release of All Awarded and Rejected Round I Applications, as Such Awards and Rejections Are Issued
Round I applicants, and entities considering Round II filings, need to understand what worked and what did not in Round I. As of now, the agencies are still not releasing even the non-proprietary data from either awarded or rejected applications.
6. Direct the Immediate Release of All Agency Scoring and Other Review Information Relative to Rejected Round I Applications
Akin to # 5, above, prospective applicants need to understand the details of why certain applicants received awards, and and why most did not. As Geoff Daily suggested this week, the best information to inform these questions is retained by the agencies as scoring data produced by the review process itself.
Even when proposed network projects reach toward $100 million price tags, neither agency has agreed to release the scoring information to the public, or even to applicants. The need for fully transparent data in this regard is especially clear as it is today impossible to determine what weight was assigned to the many Public Notice Filings by incumbent carriers against Round I applicants. Although the NTIA Administrator has testified to Congress that 'the incumbents do not have a veto,' we have no way to confirm this has been the case during the review process.
7. Direct the Publication of the Application Database Census Tract Information to Verify Proposed Service Territories
As the Wireless Communications Association International (WCAI) petitioned NTIA and RUS in a letter of last week, the federal online application mapping tool "is of limited utility to potential applicants. With respect to granted applications, it does not identify which areas are covered by Middle Mile projects, and which are covered by Last Mile projects." Many broadband mapping specialists and grant application consultants have complained for months that the mapping tool simply does not provide information of sufficient granularity to support the application process.
The wireless trade group goes on to state, "Moreover, with respect to pending applications, the mapping tool does not specify the number of applications pending for a given area or identify the applicants. Thus, the potential applicant for a given area cannot make a rational attempt at assessing whether a pending first tranche application will be denied, making the area available for second tranche funding."
WCAI has suggested to the agencies a simple and readily available solution to the application mapping tool's obvious problems: release data in-hand at the agencies, as contained in the Public Notice Filing database "...which was blocked once the 30-day response period passed."
Full Disclosure:
For the first time in nearly a year of attempting to objectively report on the details and strategy of the program, today in advance of the first oversight hearing of 2010 relating to broadband stimulus, I have stepped out of what I hope has been for most of our readers an objective reporting and analysis role.
I do so to call on Congress to save the program from itself.
I do so given the legitimate and serious concerns that many of us in the "bbstim" community have with the current choices NTIA and RUS have made to engage in public information practices unworthy of an Administration dedicated to openess and transparency.
I do so hoping that Congress starts to do its job, and brigs true oversight to an important federal effort that needs immediate fixing. I do so because the agencies running the program simply are not listening to those of us most involved in the grant and loan application process -- to those of us that have called, implored, and written about these issues.
I surrender to no one my place as a huge booster of the federal broadband stimulus program, of the Recovery Act, and of the Administration of President Obama. I have spent an entire career in both competitive (yes, that means non-Bell System) cable and telecom, and in the policies and politics of the Democratic persuasion. No one could be more thrilled about the spectacular effort the President, and the Democratic Congress, are making to finally advance the national interest in ubiquitous broadband availability and adoption than I am.
Although some of us who are both of the Democratic persuasion, and from Massachusetts, may feel compelled to proverbially shoot each other in the life boats right now, my goal here is just the opposite. Those of us who believe strongly in the agenda of our President to aggressively deploy ubiquitous broadband facilities for the benefit of our nation need to stand up with constructive criticism, and detail level suggestions to fix the glaring problems with the broadband stimulus program. I have attempted to do so here.
Although I reference other commentators, reporters, and a trade association, this Commentary is fully my own. Comments are welcome, below, or by clicking: here.
- Peter J. Pratt; Editor and Publisher, StimulatingBroadband.com
7 comments:
Perfect for the incumbents--just sit back and watch everybody fall on their butts with failed applications, leave all the appropriated money on the table, then they come back in and lobby for the money and
1. Keep out new comers, and;
2. The Feds give them the balance to build out their infrastructure, to their own specs by the way, not necessarily to extend Rural broadbandeither. Perfect!
Sounds like a cross between TARP and Nancy Pelosi negotiating the Healthcare bill behind closed doors.
Where is the transparency? The incumbents have had 15 years to build out Rural America, and they did nothing. That's why this wireless broadband ( and I do not mean that WI-FI stuff some consultancy firms pushed as Nirvana either IE. the failed Philadelphia WI-FI project for example) revolution started with the Muni's 10 years ago. They got tied of waiting. So here we are. The incumbents will win again just like the big banks did who should be in jail right now.
This is a great summary. I hope everyone can copy and paste your missive and send it to their Senators. We can make change, but only if we get active right now.
My take--Part 1
Peter, the points you made in your most recent article are well taken, astute and offer excellent suggestions to the problems at hand with the NOFA grant process, particularly with what we are all trying to accomplish with the $7.2 billion in broadband stimulus dollars that have been appropriated for this effort.
If I may, let me add yet some additional observations that I think are critical to this very important effort and to its effect on the economic well-being in Rural America. That is, the “successful expansion and deployment of rural broadband” throughout Rural America. This is where broadband is most needed to help create jobs and economic prosperity.
As a broadband technologist and IT consultant, I have been a contributor to the “rural broadband revolution” for nine (9) years now traveling all over Rural America, working with cities, towns, schools, hospitals, service providers, and others, to offer innovative ways to deliver both Last Mile and Middle Mile broadband connectivity, primarily fixed CDMA and pre WiMAX wireless. (not WI-FI)
I have seen firsthand the positive effects on communities when high speed broadband comes to town. Without it, they become part of the “Digital Divide”, but on the wrong side of the divide unfortunately. With broadband comes the economic prosperity they had been waiting for. The lake thereof by the way, started this whole “Muni” revolution and so here we are today. Where were the local telcos by the way?
My take--Part 2
My observations, while relevant to the "BBSTIM" crowd who have labored so diligently to get their grant(s) approved in NOFA 1, also demonstrates the problems with "any government stimulus" package", whether for broadband stimulus or money for revolutionizing health care.
While the $ 7.2 billion appropriated for broadband stimulus in 2009 ARRA is laudable, let us remember, its intended purpose was to create jobs and stimulate the economy. Unfortunately, as we labor into NOFA 2, I would argue the effort thus far has failed on most ALL fronts and has caused great economic damage to vendors, private companies of all sizes, public utilities, service providers and many more organizations.
In addition, let us not forget those rural folks who have been put on hold again, as they wait and wait for this entire broadband infrastructure to roll out and take effect in their non or underserved communities.
For the most part, many of the delays have been caused by bureaucratic and political snafus, and the confusion has been caused by many factors, some outlined in your latest writings. In addition, we cannot forget the huge number of NOFA 1 applications, overwhelming the NTIA and the RUS.
But I also might add, that it in my opinion, there were some entities / actors “behind the curtains” who may have played a part in influencing the rules and regulations of NOFA 1 and contributed to this confusion and have been delighted in the outcome.”
My take--Part 4
Now we hear some of those actors are reportedly going to enter the fray of NOFA 2 as the dust has settled and now, as they “stood on the sidelines but behind the curtains” they know how to prepare a successful NOFA 2 application.
Those “unknowns” stand to benefit from the confusion as we go into NOFA 2 having survived and learned just watching from the sidelines as NOFA 1 wantabes tried to traverse their way to a successful grant award. This week, some 1,400 hundred letters of rejections were sent out to those waiting for their yea or ney, more zombied than ever.
Most importantly, and the key point I am making here as it stands today, is that the broadband stimulus act has had just the opposite effect than was intended. Indeed, I would argue it has created a loss of jobs, as well as economic damage to economic development. We now stand to lose everything, or most of all we all have worked for so hard.
With the all the former comments made, I would also add the following observation. In January ’09, we all were optimistic when this broadband stimulus package was announced. However, having witnessed personally a similar, but much smaller state sponsored broadband stimulus program, I must admit, I was skeptical.
But here is what happens when the government says it going to hand out stimulus dollars, economic commerce stops, except for the grant writing,consultancy, and law practices, as many turn to those experts who provide a vital service as organizations try and weave their way through the grant process, which is no easy task. Just read NOFA 1 and NOFA 2 before you go to bed every night. No, not a good ideas—I hate nightmares.
An example of this and to further explain this phenomonen; I have clients who had the money in January ’09 and the budget to expand their operations,
but said, “Hey, if I can get free money, I’m, going for it.”
So guess what happens, all those projects are put on hold and hold and hold while they wait and see if they get their grant approved. Then almost a year after the program was announced, January 2010, you get your rejection or award letter.
So guess what happened over these last 12 months of waiting. Integrators who specialize in rural broadband deployments, whether wireless or fiber, or cable, lay people off or go out of business, because commerce stops DEAD in its tracts. Wireless vendors—same thing. And it goes on and on.
Let us hope wiser heads prevail in the months and years to come and the government understands the negative effects of “how stimulus” is distributed. Just today, it was announced that the Feds are going to “divert” the returned TARP money funds and use it for small business loans and grants-----because the banks are not loaning out any money. Well, they sure are not if the government takes the risk; they will just sit back and collect interest.
As Reagan used to say, “Well, there they go again.” So here we go again, with another, much needed stimulus effort for small business, but not the right process in my opinion. This almost forces business to go to the government well and line up for that loan instead."
By the time they get the money, it will be too late.
Great summation, PJ. I concur. I enjoyed these "anonymous" replies as well. Thanks for the dialogue and ideas.
The area we are trying to serve broadband consists of 1 1/2 counties in Virginia. This area has 1 stop light, 1 McDonalds, 32 people per square mile, 35 miles from closest city (as the crows flies and going over several mountains). More importantly, as referenced in our rejected grant request, there were two recent studies, one paid for by county, one done by JMU, which both concluded that 90% of entire county is on dial-up, yet there is a strong need for broadband.
So why is the reason given for our rejection, "Application failed to demonstrate that the proposed service area was an unserved, rural area 50 miles
from the limits of a non-rural area.", fair? Of course it is not, not when companies like Digital Bridge wins to cover areas which are certainly served areas with fiber and other current broadband services.
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