Two New York Groups Receive Stimulus Funding for Broadband Projects; PULP Awaits the Fate of its Proposal

As part of the American Recovery and Reinvestment Act of 2009 , the federal government allocated $7.2 billion to the Department of Commerce's National Telecommunications and Information Administration ("NTIA"), and the Department of Agriculture's Rural Development Utilities Program to map broadband infrastructure in the United States, develop a plan for broadband deployment, and issue loans and grants to fund broadband access and availability. The first set of grants was announced last month and will continue to be issued through February. Among the projects awarded in this first round were two to expand broadband deployment in New York State totaling over $45 million. PULP's proposal for a grant to make broadband access affordable to low income customers is still pending.

Two companies, ION and the Development Authority of the North Country, will develop a regional broadband network to connect more than 100 community institutions throughout the North Country, Mohawk Valley, Finger Lakes Region, and Western New York and will enable last-mile connections to 250,000 households and 38,000 businesses. They will receive $39.7 million. In addition, Slic Network Solutions, which is owned by the rural Independent local telephone company Nicholville Telephone, will receive $5.4 million in federal funds to build a fiber optic network in rural Franklin County to deliver broadband voice and television services to remote rural areas in that part of the state.

The $45.1 million going to New York is nearly one-quarter of the $183 million awarded nationwide for broadband projects to date.

There are numerous examples of federal money leaving New York and going to other states See, e.g., All NY Phone Customers Lose Big $$ Due to PSC Lifeline Policies, so it is positive news that some broadband stimulus money will be returning to New York. However, just because broadband infrastructure will continue to be extended to every corner of the state does not mean that everyone can afford it. A goal of nationwide, ubiquitous broadband requires more than the availability of the physical hardware; the access has to be affordable if the success is to be sustainable.

PULP submitted its application to NTIA in August 2009 for stimulus funding to increase opportunities of low and fixed income New York consumers to afford and maintain broadband service . PULP proposed a stopgap solution - in the absence of any effective national or state broadband affordability program - to stimulate better utilization of existing utility low income rate discounts, so that those now on budgets seemingly too tight to afford broadband could create enough headroom to subscribe. Large numbers of New York households are currently eligible for utility rate discounts for telephone and energy services, but only a small proportion of those eligible are reached by the utilities. In addition to working to expand participation in the existing utility discount programs, PULP also proposed to develop a model for achieving affordable broadband service and model consumer protections to help prevent households from losing the service.

The remainder of the $4.7 billion set aside for broadband will be awarded over the next several weeks. However, more than $28 billion has been requested and the success of any pending proposal, including PULP's, is unclear at this time.

Lou Manuta