Blog Post

Found: Missing Broadband Stimulus Funds!

Stay on Top of Enterprise Technology Trends

Get updates impacting your industry from our GigaOm Research Community
Join the Community!

The two federal agencies responsible for allocating the $7.2 billion in broadband stimulus dollars today released information about the next — and final — round of funding. For those of you who don’t recall, the first round was supposed to dispense $4.7 billion and was plagued by delays and a mystery of missing funds.

Today, we get information on the second round in which the National Telecommunications and Information Administration (NTIA) and the Rural Utilities Service (RUS) will give out more than $4.6 billion in funds.

As part of the formal paperwork that lets people know there’s money to be had, I discovered what happened to missing funds I had written about a few weeks ago. The RUS was supposed to give out $2.6 billion in the first round but only wrote checks for $300 million. I wondered what that meant for the original applicants seeking the grant money and where the rest of the money was.

Today, my questions are answered, as the RUS says it has $2.3 billion to give out during this second round of funding, and that companies and towns that applied for money the first time around can either resubmit their original application or better tailor it to the new rules for this funding round. The majority of the RUS funding will be for last mile projects and middle-mile infrastructure. The RUS will only allocate money for satellite providers for areas that remain unserved after all other Recovery Act broadband funding is awarded.

The NTIA will hand out the remaining $2.35 billion. People can send in applications between Feb. 16 and March 15, 2010, and the agencies plan to announce all awards by Sept. 30, 2010, which is the deadline by which all funds have to be allocated under the original legislation. They’re cutting it close.

Image courtesy of Flickr user AMagill

8 Responses to “Found: Missing Broadband Stimulus Funds!”

  1. I have a problem with the interpretation that the first NOFA is over and that all applications are essentially being deferred to the second NOFA. First off, it just doesn’t make sense. Granted, I can see why the RUS might award few to no middle mile awards in NOFA 1 given the bias of NOFA 2, but so what? Why wouldn’t they continue to process and award for last mile?

    Also, remember that the amount of funds available can be levered 7:1 for loans and the RUS has not always been clear about how it refers to its capital.

  2. Total Recovery Act available funds is $7.2 billion. $4.2 billion was allocated for Round I and $3 billion for Round II.
    In Round I RUS/BIP had $2.325 billion and NTIA/BTOP $1.875 billion. To date 19 projects for a total of $190,094,190 has been announced. Where do you get the $300 million figure in your article?

    The Round II NOFA’s for BIP and BTOP have been released, though the Federal Register release is on Jan 18th, and the total funding is $4.795 billion or $1.795 billion over the $7.2 billion from the ARRA Recovery Act.

    There are two assumptions to be made; the first is additional money from TARP has been allocated to the program and the second is money was moved from Round I to Round II.

    If funds were moved from Round I to Round II then RUS/BIP most likely took the hit and intend to award only $530 million in Round I. If this is the case then there are still $2.2 billion in awards to be announced in between the RUS and NTIA in Round I, which by the way, many companies still have not been informed one way or another and there are companies still in due diligence – Step 2.

    You make it sound as though Round I is over, which is very disconcerting given the release of the Round II NOFA’s and the lack of communication from RUS and NTIA with the applicants. Is it over? Are they calling it and leaving us hanging after five months of gut churning waiting and anticipation?

    • Here are the facts on both programs to date:
      1. BTOP has funded 11 projects for a total of 136,458,474.00 (119 mill to infrastructure, 14.8 mill for public computer centers, and 2.4 mill for sustainable adoption)
      2. BIP has funded 8 projects for a total of 53,789,398.00
      (BIP only funded infrastructure in the first round)

      Under the 1st NOFA (joint NTIA/RUS NOFA):
      1. BTOP made available up to 1.6 billion
      2. BIP made available up to 2.4 billion
      *The 1st NOFA says any unused funds can be distributed to subsequent NOFAs.

      The first round is not over yet. There are hundreds of applications currently pending. Whether they get funded under BIP remains to be seen. Under the 2nd BIP NOFA, RUS is making available up to 2.2 billion. Remember, BIP’s total allocation under ARRA is only 2.5 billion. It is possible RUS is contemplating scrapping the first round and distributing a majority of money in the final round. The 2nd NOFA cryptically says this by alluding to how applicants can rework their first round applications.
      What is troubling is how this entire BB Stimulus has seemingly taken place inside a black box.

  3. Stacey
    Nice pickup. I’m reading the NOFA and went to see what other folks had found, and so far you’ve the best coverage. On NTIA, they have taken the money away from extending broadband to more places and put in a program for faster connections for community colleges, etc.
    I believe both are inspired by the fact the vast bulk of applications did almost nothing for the unserved and that at great expense. There are few grants requested thast weren’t mostly waste or worse. db

    • “I believe both are inspired by the fact the vast bulk of applications did almost nothing for the unserved and that at great expense. There are few grants requested thast weren’t mostly waste or worse. db”

      Do you have actual firsthand knowledge of this (i.e., you are a reviewer) or is this just conjecture?