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Geoff Daily

App-Rising.com covers the development and adoption of broadband applications, the deployment of and need for broadband networks, and the demands placed on policy to adapt to the revolutionary opportunities made possible by the Internet.

App-Rising.com is written by Geoff Daily, a DC-based technology journalist, broadband activist, marketing consultant, and Internet entrepreneur.

App-Rising.com is supported in part by AT&T;, however all views and opinions expressed herein are solely my own.

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March 4, 2009 11:41 AM

Will/Should States Decide Who Gets Broadband Stimulus Dollars?

One major unresolved issue regarding the NTIA broadband grants is what role states will play in determining who gets those government dollars.

According to the legislation, NTIA is supposed to seek out and consider states' advice about which projects should be prioritized, but there's no mandate that they have to follow those recommendations.

According to the latest scuttlebutt I've heard, because of the overwhelming wave of applications about to come crashing down on NTIA they're leaning towards shifting the responsibilities of making these decisions on who gets what to the states.

But before we go any further we need to answer the question: is it a good idea to have states making these decisions?

In theory, yes. It makes sense that states would have a better feel for where the greatest need is and who the best entities are to partner with to get the job done.

But in reality there's a lot more complexity to this question.

For one, some states are more advanced in their understanding of their current state of broadband and what their goals for the future should be. On the flipside, some states are behind the curve on this and may not be in a position to make the right decisions quickly.

Two, even those states that are more progressive in putting together a plan I have questions about their ability to come to a consensus among all the interest groups. The simple truth is that despite the best intentions of initiatives like the Minnesota Ultra High Speed Broadband Taskforce to bring all the stakeholders together around the same table, when push comes to shove they all want the money for their own communities or companies, so how can they ever come to agreement on who should get it and who shouldn't?

Three, the decisions states ultimately make will likely be most influenced by those communities that are the most politically connected at the state level and those companies that have the biggest lobbying presences. In other words, these limited funds won't necessarily go to the projects that are most shovel-ready and that provide the most public benefit in the short and long-term, which is supposed to be the point of the stimulus.

For these reasons I can't help but think that there needs to be a federal role in deciding which projects to fund so that this money goes to the best, most ready projects not those with the best PR and political connections.

But at the same time I completely understand why NTIA might pass these decisions off to states. Ohio alone is claiming it has 250 projects ready to start deploying within 6 months. Extrapolate that across the nation and that means there's going to be thousands, if not tens of thousands, of projects to vet and compare the relative merits of. That's going to require an ungodly amount of work, which NTIA doesn't currently have enough staff to handle, and a lot of hard decisions to be made, which NTIA doesn't yet have a leader officially in place to make yet.

So where does that leave us? At a bit of an impasse, with neither the states nor NTIA alone offering a clear path for success in getting this money into the right projects in a timely fashion.

So what should we do? Let me propose a potential middle ground.

Let's divvy up the money among the states based on population, area, number of unserved homes, or some combination thereof. Then cut that number in half.

With one half have the states submit their top project(s) for fast-track funding. As soon as they decide who should get it, just do a quick review of the project to make sure it qualifies and then write the check.

Then with the other half let's have the NTIA go through the process of accepting, reviewing, and rewarding applications, but do so with a bias towards larger projects that not only connect a lot of people but also lay the groundwork for future network expansions. And approve them as they come in and are vetted rather than waiting to compare all applicants.

In this way every state can get its grant and we can get a lot of projects moving as quickly as states are able to come to agreement on which to fund, plus we can make sure we're rewarding progressive states, communities, and projects rather than just those that are most well-connected politically at the state level. And in doing this we can create competition between projects not just in a state but between states to help insure these dollars are being spent in the best way possible.

Just as it may not be feasible for NTIA to do this all on their own, I'm also not a fan of them punting on these decisions and putting all the responsibility for decision-making on the states. We need to find a way to leverage all of the tools at our disposal to not just get this money out quickly but also correctly.

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