Washington

ACA: New Stimulus Rules Are Not Fair and Balanced

Small and mid-sized cable operators unhappy with new guidelines 2/02/2010 02:01:00 PM Eastern

Small and mid-sized cable operators are not happy with the
new guidelines in the second round of bidding for broadband stimulus bucks,
with the American Cable Association arguing that the guidelines essentially cut
them out of meaningful participation in the stimulus project.

ACA represents almost 900 operators.

"ACA is disappointed that NTIA and RUS structurally
modified the programs in a way that makes it harder for small cable providers
to receive last-mile funding," said ACA President Matt Polka. "The
rules seem to favor every entity except small cable operators, who are
well-positioned to deliver state-of-the-art broadband facilities in rural and remote
communities at low costs."

The guidelines were revamped in an attempt to make it easier
and more attractive to bid, but there was also a thumb added to the scale in
NTIA funding decisions for middle mile projects that link anchor institutions
like schools, libraries and community centers, rather than the "last
mile" projects that wire unserved consumers. RUS was left to hand out most
of the last mile money. But the new RUS guidelines give even more weight to
companies that have already borrowed money under the Rural Electric Act, says
Polka, which means it favors traditional phone companies. The new round of
bidding also sets aside $100 million for satellite broadband targeted at the
same rural unserved areas ACA members target.

In a letter to the heads of the National Telecommunications
& Information Administration and Rural Utilities Service, which are handing
out the billions in broadband bucks, Polka said that the new guidelines
"extinguish any hope for small cable operators to use broadband stimulus
funds to build out last-mile facilities."

Of the 80 ACA members (less than 10% of membership) who
applied in the first round of funding, only one received it, according to
Polka, suggesting the odds for success could be worse, not better, this time
around.

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