Stimulus Endgame: House and Senate OK Billions for Broadband

IT and Broadband stimulus

After twin floor debates flush with partisan rancor, the House and Senate today passed the economic stimulus package that would send billions of dollars to broadband expansion and other IT initiatives. President Obama could sign the $787 billion bill into law as early as Monday.

In the Senate, the same three Republicans who broke ranks to support the first version of the bill voted in favor of it again today. The crossover votes of Susan Collins and Olympia Snowe of Maine and Arlen Specter of Pennsylvania gave the Democrats the 60 votes they needed to pass the stimulus legislation, which supporters expect to create or save more than 3 million jobs.

The bill cleared the lower chamber by a margin of 246 to 183, without a single Republican voting in the affirmative. Seven House Democrats opposed the measure.

The IT provisions in the bill include $7.2 billion for broadband network expansion in rural and underserved areas, as well as $19 billion for health IT initiatives and $4.5 billion for smart-grid technology. It would also allocate $650 million for the government-run program to help consumers pay for the converter boxes they will need to keep older TV sets working once broadcasters shut off analog signals in favor-of all digital transmissions.

The bill is the product of a conference of members of the House and Senate, where negotiators reconciled the versions of the bill passed earlier by each chamber.

In crafting the final language of the broadband portion of the bill, the conference struck provisions from the Senate version that would have offered tax credits to ISPs for building networks with baseline speed requirements. Now, all of the money for broadband in the bill would be allocated in the form of grants and loans. It also does not set minimum speed requirements, but directs the agency administering the bulk of the funding to give priority to network projects that will deliver faster speeds.

The original version of the American Recovery and Reinvestment Act also cleared the House without a single Republican vote, and the objections GOP members voiced today mirrored the earlier debate.

Republicans criticized the bill for funneling excessive sums of money to government programs that didn’t belong in the stimulus bill. Characterizing many of the measures as earmarks — a term eschewed in the stimulus debate by Obama and the Democrats — GOP members blasted the bill for throwing billions of dollars to programs that might be worthwhile, but failed to meet the singular criterion of the stimulus package: creating jobs.

“Facts are stubborn things,” Rep. Jerry Lewis, R-Calif., said in floor remarks this morning. “The fact is that this stimulus package does more to promote the growth of federal government than it does to create jobs or stimulate our economy.”

[cob:Special_Report]Republicans also complained that the more-than 1,000-page conference report was delivered to their offices after midnight this morning, with the final debate and vote scheduled for this afternoon.

“I’m a big believer that we shouldn’t come to the floor and talk about process, but bad process leads to bad policy,” Minority Leader John Boehner of Ohio said in floor remarks this afternoon. “And that’s what we have here in my view — bad policy that will drive up the debt and put all of this cost on the back of our kids, our grandkids and their kids.”

A boon for the Net neutrality set

The broadband provisions of the stimulus bill represent a significant victory for the advocacy groups championing Net neutrality.

The lion’s share of the broadband provisions require the network operators to adhere to “nondiscrimination and network interconnection obligations” that would be determined by the administration overseeing the grants.

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IT and Broadband stimulus

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A controversial amendment opposed by the Net neutrality groups also failed to make the final cut. Sen. Dianne Feinstein, D-Calif., had introduced a provision that would have amended the Net neutrality language to allow for “reasonable network management practices such as deterring unlawful activity, including child pornography and copyright infringement.”

That amendment, supported by the entertainment industry, would have allowed ISPs to apply content-filtering technology to their networks to screen for illegal content. For groups like Public Knowledge, that would have mistakenly cast ISPs in the role of “copyright cops.” The group has also warned that filtering technologies carry a margin of error, which would lead to some legal content getting blocked, a condition it says is tantamount to a violation of free speech.

Striking the Feinstein amendment from the stimulus bill is certainly a victory for Public Knowledge and others, but Art Brodsky, the group’s communications director, believes that the fight over content filtering for copyright violations, backed by the entertainment industry, is far from over.

“We expect the issue to surface again,” Brodsky told InternetNews.com.

Where the money goes

The bill would allocate $4.7 billion to create a Broadband Technology Opportunities Program to be administered by the National Telecommunications and Information Administration (NTIA), a division of the Commerce Department.

The money is intended to promote network enhancements in underserved parts of the country, as well as education and training programs aimed at spurring demand for broadband services.

The bill would require the NTIA to administer all of the funds by the end of fiscal 2010. Companies would be obligated to “substantially complete” their network expansion projects within two years after receiving grant money. Groups taking stimulus grants would also be required to provide the NTIA and key House and Senate committees with progress updates on their projects every 90 days.

The federal funding would be capped at 80 percent of the total cost of a project, though it provides the NTIA with some latitude in granting exceptions in cases where an applicant demonstrates a compelling financial need.

For rural areas, where broadband deployment has been hindered by the prohibitive cost of building networks for a sparse base of subscribers spread over long distances, the bill would allocate $2.5 billion to an agency within the Department of Agriculture to spur new high-speed networks.

For a project to be eligible for loans and grants from the Rural Utilities Service, 75 percent of its coverage area would have to be rural and without existing broadband service.

To guard against double-dipping, areas that stand to benefit from network-expansion projects funded by the NTIA would be ineligible for loans or grants under the rural broadband program.

The bill would also require the Federal Communications Commission to develop and report to Congress a plan for a national broadband strategy within a year.

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