Quoth the Banker, "Watch Cash Flow"

Provisions on Broadband Infrastructure

The Conference agreement creates a new Broadband Technology Opportunities Program within the National Telecommunications and Information Administration ("NTIA") of the Department of Commerce. The new grant program will distribute $4.7 billion to fund the deployment of broadband infrastructure in unserved and underseved areas in the country, and to help facilitate broadband use and adoption. An additional $2.5 billion in loans and grants will be administered by the Rural Utilities Service.

The Conference agreement combined portions of both the House and Senate bills. The main provisions of the NTIA program include:

Grant Recipient Criteria. Any entity is eligible to apply for a grant, including municipalities, public/private partnerships, and private companies, so long as the entity can comply with the grant conditions. Applicants must put forth 20% of the proposed project's total cost, subject to a financial hardship waiver.

Grant recipients must agree to abide by a set of conditions, including adhering to a build out schedule, to interconnection and non-discrimination requirements as established by NTIA, and to the principles contained in the Federal Communications Commission's Broadband Policy Statement. The Conference agreement does not require that grant recipients meet certain broadband speed thresholds, although the NTIA is expected to consider and support the highest possible broadband speeds in awarding grants.
     
National Broadband Plan. The Federal Communications Commission is required to develop a national broadband plan within one year.

Now here's the question:  if we "watch cash flow", the FCC is charged with coming up with a "national broadband plan" within a year, yet the NTIA (part of the Dept. of Commerce), and the Rural Utilities Service (part of the Dept. of Agriculture) are charged with distributing the stimulus funds; what gives?  If the FCC is in charge of the "broadband plan", then why do the NTIA and RUS distribute the money, and determine the criteria, for broadband grants under the stimulus package?

Well, as Sigmund Freud, may or may not have said, "[s]ometimes a cigar is just a cigar."  The only ready-made means that the FCC has for distributing money is through the Universal Service Fund - a fund which a series of FCC inspector generals have described as characterized by inefficiency at the least, and rampant waste, fraud and abuse at the worst.  Moreover, the last time the composition of the FCC changed political parties (in 2001), the Commission was not filled, with a new Chairman in charge of a full Commission until early August of 2001.

The broadband stimulus money, on the other hand, is intended to get "working" as quickly as possible.  The only way the decisions can be made to get that money into the broadband economy as quickly as possible, given present circumstances - and realities of political confirmations - is to distribute the money through executive branch agencies.

So, when there's only cash, everyone "watch[es] cash flow."  This leads some to predict a greater role for the executive branches in formulating telecom policy.  However, every rule has its exception, and, I think, in this instance there is little to be learned about the focal point of telecom policy in the Obama administration from the stimulus package.  The as-yet-not-fully-staffed FCC has a clear role for policy development, and the more fully staffed executive branch agencies have a clear role for moving grants out quickly.  When "policy" is the ostensible centerpiece of the public debate, watching cash flow yields more prescient results.  Stay tuned.