Rural broadband lost in the back roads

The massive, nationwide $4 billion Broadband Technology Opportunities Program (BTOP) has run off the road in many parts of the country. Recent reports show overruns, favoritism and unnecessary duplication of infrastructure.

Congress funded BTOP as part of the stimulus bill to create jobs and to build out broadband to areas of the country where it had been too expensive to extend it. Certainly the need is great: three-quarters of the 19 million U.S. households without access to high-speed Internet live in rural areas. But BTOP was only supposed to fund build-out of broadband networks to places that do not have a broadband provider - not build parallel structures.

As The New York Times reported, "...local phone companies have complained about waste or unfair competition, like using some of the grants to build fiber networks where they already exist... rather than where they are most needed, in rural mountain towns."

The Times cites the case of Agate, Colorado, where the state education consortium, Eagle-Net, built a fiber optic connection to the town's tiny elementary school - which already had two such connections. The article also notes cases where fiber lines built "through neighborhoods where its project engineers lived," and other projects with unjustified expenses.

As a result, "Nationally, $594 million in spending has been temporarily or permanently halted, 14 percent of the overall program, and the Commerce Department's inspector general has raised questions about the program's ability to adequately monitor spending of the more than 230 grants."

Moreover, the money involved has produced some questionable practices. An independent website in Vermont reported that the state's head of broadband expansion - whose program, ConnectVT, had received $116 million of BTOP funds - just left the office to head the company she had been overseeing. The official and new company president, Karen Marshall, now heads VTel, which had been the largest recipient of state and federal funding. VTel is in competition in Vermont with CWA employer FairPoint - placing Marshall's company at a distinct advantage for BTOP funds.

Eighth Broadband Progress Report (FCC, Aug. 21, 2012)

Waste Is Seen in Program to Give Internet Access to Rural U.S. (NY Times, Feb. 12, 2013)

Marshall, the Shumlin administration's broadband "czar," takes job with VTel (VTdigger.org, Feb. 9, 2013)

Telecom Czar's Departure Raises Questions About Montpelier's Revolving Door (Seven Days, Jan. 16, 2013)