For years, small broadband providers have been locked out of the Connect America Fund, which is supposed to support broadband service in hard-to-reach areas. Now rural groups are a step closer to getting access to some of that funding — if enough of them ask for it.
Small Internet providers that have been trying to tap federal funds to serve hard-to-reach rural customers are going to get a crack at some of that money, but their first step will be convincing the Federal Communications Commission there’s demand for the funding.
Last week the FCC voted to launch an experimental program to allow surplus from the Connect America Fund to go to rural broadband providers that hadn’t previously been eligible for the support. The money will pay for pilot projects to help the FCC learn what approaches work best for expanding broadband service in rural areas.
How much money will go into the pilot projects? The FCC hasn’t decided yet. And here’s the catch: The commission is going to wait to see how many broadband providers are interested in the new source of support before they determine the overall funding for the experiment.
“I think if we see a big expression of interest, we’ll set a bigger budget,” said Jonathan Chambers, the chief of the FCC’s Office of Strategic Planning and Policy Analysis. “We’ve got to hear from folks first, and I think we will. … But if we don’t hear anything, we’ll learn something.”
Clockwise from top left: Connie Stewart, Wally Bowen, Edyael Casaperalta and Sean McLaughlin — members of the Rural Broadband Policy Group were pleased with the FCC’s plan. Rural broadband advocates say the field is up to the challenge.
“This is a chance to show the FCC that there’s a lot of interest among rural providers for this funding,” said Edyael Casaperalta, coordinator of the Rural Broadband Policy Group and on staff at the Center for Rural Strategies (which publishes the Daily Yonder).
In 2010, the FCC restructured the Universal Service Fund and established the Connect America Fund as part of the National Broadband Plan. The fund is supposed to help telecommunications companies make the transition to new technology like broadband, especially in harder-to-reach areas like rural communities.
But the funding has been available only to large “incumbent” telecommunications providers like AT&T and Verizon. Some of those companies have turned down Connect America funding because they didn’t like the rules that came with the funding, Casaperalta said.
That left some money sitting unused in the fund.
In the meantime, groups that were anxious to provide broadband in rural areas couldn’t get access to the support because they weren’t eligible for the Connect America Fund, Casaperalta said.
The new FCC experiment is looking for “diverse” rural organizations to tell the commission how they would invest Connect America Fund money in rural broadband projects. That opens potential applicants up to nonprofit organizations, cooperatives, municipal or tribal governments and private businesses, for starters.
Chambers at the FCC said the initial “expression of interest” isn’t a complex document. The FCC wants to hear who is interested in applying for support, what homes or institutions they want to serve and an estimate of the cost to get the job done.
Once they have that information, the commissioners will consider the next steps in creating the funding stream, Chambers said. A background report on the funding experiment asks rhetorically whether the FCC should fund the program at $50 million or $100 million and whether the funding should be spent in one year or over several.
The experiment is to help prove that Internet providers can serve rural communities with adequate broadband, Chambers said. “Just because you’re in a rural or sparsely populated area doesn’t mean you can’t get a decent level of bandwidth to schools, libraries, businesses and homes,” he said.
Organizations that wish to be eligible to receive Connect American Fund money for rural broadband projects have until March 7 to file an “expression of interest” with the FCC.
(More information is in the report from the FCC’s January 30 meeting. The rural funding program is discussed starting at the bottom of page 31 – paragraph No. 86. The requirements for an “expression of interest” are described on page 38, paragraph No. 105.)
Other rural broadband advocates expressed support for the program, according to a press release distributed by the Rural Broadband Policy Group.
“This is an important step in closing the digital divide for remote rural communities,” said Connie Stewart, executive director of the California Center for Rural Policy. “We thank the FCC for recognizing the need to expand funding options and provider opportunities.”
Wally Bowen, the founder of a communications nonprofit based in Asheville, North Carolina, said the experiment to fund local groups to expand broadband connections fits the way rural communities naturally work.
“This is a historic step by the FCC to empower underserved areas to meet their own broadband needs via ‘self-help’ traditions deeply rooted in rural America,” said Bowen, who is with Mountain Area Information Network (MAIN).
Sean McLaughlin, executive director of Access Humboldt, said including small, rural broadband providers in the Connect America funding experiment could help rural communities on many levels. “The rural broadband trials have the potential to support locally owned broadband media networks that build local capacity to serve public safety, health, education, media, economic development and civic engagement,” he said.
Christopher Mitchell with the Institute of Self-Reliance in Minnesota said the funding experiment could help demonstrate the strength of local organizations. “This is a great step for rural communities that have not been well served by existing providers,” he said. “It recognizes that local, nonprofit based providers may be best positioned to meet the needs of local businesses and residents.”