NCTA Says Farm Bill Needs to Fix RUS ProgramSays Broadband Loans Still Going to Overbuild Existing Service 5/07/2013 11:52 AM Eastern
The National Cable & Telecommunications Association wants to make sure the Farm Bill, likely being marked up in the Senate Agriculture Committee this week, fixes what it says is the ongoing problem of government subsidies to grow broadband where the service is already planted.
NCTA has long complained that the USDA's Rural Utilities Service loan program has no requirement that the money goes to unserved areas. RUS modified its rules after a USDA Inspector General's report that highlighted the overbuilding, NCTA pointed out in a blog posting.
NCTA says that the changes RUS made in the wake of that report do not resolve the overbuild issue. "The fact is these rules still allow loans in areas that are 100 percent served. Currently, there is no requirement that a single unserved household be included in the project's service area in order to earn funding approval."
The cable trade group hopes the latest farm bill resolves that. It backs an amendment to the bill, offered last year by Sen. Mark Warner (D-Va.) and others, that would require at least 25% of the households in an RUS broadband loan application to be unserved, with a carveout for systems serving fewer than 7,500 residents.
NCTA says it supports the RUS program so long as it is done right, which is to target the loans to those who actually lack the service, and thus not undercut the companies already delivering it.