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February 17, 2010 10:11 AM

Stimulus Mid-Term Report Card: One Year In

One year ago today, Congress passed the ARRA, appropriating $7.2 billion to NTIA and RUS to stimulate broadband deployment across America.

So how have they done so far? What have they gotten done in a year's time?

Let's pull out the grading card to gauge the stimulus at its mid-term.

The grading criteria will be how well they've done against the following questions:

- How many jobs has the stimulus created?
- How much deployment has been stimulated?
- How quickly has the stimulus worked?
- Are they picking the best projects?
- How have they handled applicants?
- How transparent has the process been?
- How well have they learned from the first round?

Note that I'm grading NTIA and RUS collectively as at least on the surface they've performed similarly.

Jobs - D
The stimulus has not created any deployment jobs to date. In fact one could argue that it actually destroyed jobs as many projects put the brakes on waiting to see if they could get free government money. The stimulus has created some work, but it's primarily been for consultants and lawyers helping applicants navigate the burdensome application process. While the stimulus should start creating jobs this year, it's uncertain when as no one's gotten any money yet.

Deployment - F
The stimulus has not sparked any deployment in 2009, and as mentioned previously it may have actually had a detrimental impact on the pace of deployment.

Speed - F
The whole point of a stimulus is to create movement quickly. We're now one year from the day Congress appropriated $7.2 billion, and not one federal dollar has gone into deployment.

Best Projects - C
While most of the winners announced to date pass the smell test, I question the relative merit of funding fiber to 400 skiing chalets or putting any money into DSL technology, both of which are among the winners so far. This is especially true as I know of a lot of higher quality projects that got rejected on technicalities and others that even though they've made it to due diligence still don't yet know their final fate.

Handling of Applicants - D
I'm really tempted to give them an F here. Most applicants heard nothing from either agency for months after applying, and then were rejected by form letter with no feedback on why they were disqualified. Early on in the process the agencies claimed they were going to work to make sure that good projects weren't disqualified based on technicalities, but then they did exactly that. A bunch of applicants still haven't gotten rejection letters and the window to submit for the second round has already opened, which is insane. The only thing keeping them from failing was that they webcast their public workshops and at least included some kind of an application database even if it's flawed in many ways.

Transparency - F
In what is supposed to be a new era of open government, this is one of the greatest disappointments. Both agencies went silent for months during this process. We have no idea if or how their review processes are working. They're not sharing any of their scoring, even for those projects they're funding. There are projects that got funded that haven't made their executive summaries public, so taxpayers know next to nothing about them. And even still today when you go to either of their respective websites or broadbandusa.gov it isn't immediately apparent who they've funded. While there are many valid excuses for the shortcomings of the review process itself due to the massive number of applications, I don't see how anyone can justify the total opaqueness that the broadband stimulus has been operating under so far.

Learned Lessons - C
Giving credit where credit's due, the second round NOFAs from both agencies are much improved. There's greater clarity and a lot of dead weight got cut out. But have they really learned their lessons? Are they really ready to handle what's going to be an even larger deluge of applications in the second round? Are they going to start being more transparent? Are they going to start treating applicants with the respect they deserve? Already you've got NTIA admitting that they're not even considering the possibility of extending the submission deadline for round two despite the fact that not all round one applicants have received their rejection notices yet. That doesn't bode well, which is why I can't give them better than a passing grade, for now.

That's the thing, though. Just because the stimulus is failing now on almost all fronts doesn't mean that it can't recover and post solid even spectacular marks. Ultimately the grade that matters most is that the best projects are funded and on that they're not failing. They're also learning from at least some of their mistakes. So I for one am still hopeful that the broadband stimulus will be more than just another government folly.

And that hope is what adds the plus to NTIA/RUS's D average.

Overall mid-term grade for the stimulus: D+

Notes: A teacher-parent conference may be needed to discuss how to improve performance.

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