State seeks $1 billion in stimulus funds to bring broadband link to every household
The good news is that 96 percent of California’s households have access to a high-speed Internet connection.
The bad news is that despite the good news, 45 percent of California residents – a number greater than the populations of all but five states – still don’t have broadband connections in their homes because of geography, disabilities, a lack of English language skills or poverty.
Now the promising news: The state is poised to grab as much as $1 billion in federal stimulus money for closing what’s referred to as a “digital divide” between Internet haves and have-nots.
“The importance of closing that gap is almost incalculable,” said Sunne Wright McPeak, president and CEO of the California Emerging Technology Fund (CETF), a nonprofit underwritten by four merged phone companies to oversee one effort to expand the use of broadband.
“Whether it’s health care or education or a host of other aspects of life, broadband (high-speed) access is vital to virtually every person in California.”
The money that the state is poised to grab is part of $7.2 billion that was included in the American Recovery and Reinvestment Act passed by Congress in February. The money was dedicated to the simple proposition that getting as many Americans as possible hooked up – at high speeds – to the Internet is a good idea.
The federal money could be spent in a variety of ways: for construction of both wired and “wireless” Internet-access systems; for connection projects aimed at specific groups, such as senior citizens or patrons of public libraries; to subsidize access fees for low- income users; and for education and outreach programs designed to impress the Internet’s importance on groups that currently don’t use it much.
But like so much of the stimulus package, the promise is shrouded with complex uncertainties:
• Distribution of the money is being overseen by three separate federal agencies – the Federal Communications Commission, the Department of Food and Agriculture and the National Telecommunications and Information Administration – each of which is responsible for different aspects of the program. That complicates the process.
• Basic terms, such as what denotes an “unserved” or “underserved” community, or what constitutes “high-speed” service, have yet to be defined, although more than 1,400 versions have been submitted by various interested parties.
• Because the rules for applying have yet to be drawn up, applicants ranging from states to small nonprofit groups (as many as 100-plus in California alone) aren’t sure whether it’s best to band together or try to make one’s own separate case for a portion of the money.
“It’s a somewhat messy process,” acknowledged McPeak, whose group is one of those attempting to coordinate California’s efforts. “We don’t know how they plan to review (applications) or distribute.
“We’re prepared for there to be a call for (application) proposals in June, with a turnaround that could be as short as two weeks.”
McPeak’s organization reflects a fortuitous situation, (and one that’s relatively rare in California): State officials were already actively addressing the issue and were ready to jump on the prospect of federal funds that could stretch state funds already allocated to such efforts.
In 2005, the California Public Utilities Commission extracted $60 million from major telecommunications companies and established the California Emerging Technology Fund.
The CETF was ordered to use the funds as seed money for programs that would extend high-speed Internet access to rural communities that commercial carriers regarded as not worth the cost of hooking up, and urban areas dominated by low-income residents who were less likely to avail themselves of available broadband services.
A similar $100 million program, called the California Advanced Services Fund, was authorized by the PUC in 2007.
State officials believe they can make a case for $1 billion of the $7.2 billion in federal funds because of the state’s population (around 12 percent of the U.S. total) and because California already has the two programs, as well as extensive mapping of served and unserved areas already in place.
“We’re making the argument that we offer the federal government the best return on its investment,”said McPeak. “We’re better suited than almost anyone to spend the money effectively.”
The PUC-spawned agencies aren’t the only ones in the state looking to collect some of the federal dollars.
In El Dorado County, freelance journalist Fred Pilot launched a cooperative last week to provide Internet service through a fiber-optic network to Net-neglected residents around Camino.
“We’re going to try and qualify for the stimulus funding,” Pilot said, “because we are the kind of area this is targeted for.”
If it could land a chunk of the funding, he said, the co-op would hire a local phone company to build the system, then run it on a majority-rules basis.
“I really do believe that this has to be done on a bottom-up basis,” he said, “because the top-down model hasn’t worked.”
As a country, the United States lags behind 16 other industrialized nations in broadband availability, according to a United Nations survey published in March.
About 4 percent of California – an area roughly the size of Kentucky with a population equivalent to Maine’s – currently lacks any broadband service, mostly in less-populated rural regions that aren’t financially attractive enough to lure big companies.
But the bigger problem in California is not availability, but convincing some segments of the populace to avail themselves of it, and making it inexpensive enough that they can afford it.
Surveys have found that only a third of the state’s Latino households, and about the same percentage of households with incomes less than $40,000 a year, have broadband service at home.
The federal money could help subsidize service to low-income households as well as finance consumer education programs designed to demonstrate the value of having a hooked-up household.
“Studies have shown that the faster the (Internet) connection, the more people will use it, and therefore the more valuable it is,” said McPeak. “But nearly half of California is not hooked up to a broadband service.
“That is just totally unacceptable in the state that has given the world so much of its cutting-edge technology. It’s time to change it.”