While President Obama does not claim to have invented the Internet, he wants his administration to be responsible for making it accessible and affordable for all Americans.

He began talking about those goals well before his inauguration. In a December 2008, radio address, Obama said, “It is unacceptable that the United States ranks 15th in the world in broadband adoption. Here, in the country that invented the Internet, every child should have the chance to get online, and they’ll get that chance when I’m president because that’s how we’ll strengthen America’s competitiveness in the world.”

To implement that goal, Obama included extending broadband technology as part of his American Recovery and Reinvestment Act, which was enacted on Feb. 17, 2009. The law contains $7.2 billion in new spending on broadband infrastructure deployment and related broadband matters. The National Telecommunications and Information Administration (NTIA), a division of the U.S. Department of Commerce, will administer $4.7 billion while $2.5 billion will be administered by the Rural Utility Service (RUS), a division of the U.S. Department of Agriculture (USDA).

Broadband technology opportunities

NTIA will establish a broadband technology opportunities program for grants to eligible entities to develop and expand broadband services to underserved and rural areas and to improve access to broadband by public safety agencies. Of the funds, $250 million will be available for innovative programs that encourage sustainable adoption of broadband services.

“We want to begin to close the broadband gap across America,” said Rick Wade, senior adviser and acting chief of staff of the Department of Commerce. “So we’ll extend high-capacity pipes closer to users in rural, remote and underserved communities. As Congress has instructed us, other companies will be able to connect to those pipes, which will spur competition and get services to people and businesses.”

Another $200 million will be available to upgrade technology and capacity at public computing centers, including community colleges and public libraries.

The NTIA grants must be awarded by Sept. 30, 2010, and must be spent within two years of being awarded. And Congress expressly noted in its conference committee report that it expects grants to serve rural, suburban and urban areas.

Rural utility service funds

While the NTIA will be issuing grants to distribute its funds, the RUS has stated that it intends to “leverage” its $2.5 billion of funding through loans and loan guarantees, but it also may offer grants or grant/loan combinations.

U.S. Secretary of Agriculture Tom Vilsack said, “I’m particularly interested, and I know the president is as well, in making sure that we make this technology, which is the lifeline to economic development, available in all parts of the country. We’re interested in working with the private sector, working with our federal partners as well as local governments to find the most creative and innovative ways to expand this technology. And we’re anxious to leverage the resources beyond the [$2.5 billion].”

Tom W. Davidson, partner and head of the communications section of the law firm Akin Gump Strauss Hauer & Feld LLP, explained that all RUS funds distributed under the act are required to be used for projects serving areas that are at least 75 percent rural. It will favor deployments in unserved and inadequately served communities of 25,000 people or fewer.

“As a result of its ability to leverage its portion of the funds through the use of loan guarantees, the RUS may end up impacting more people than the NTIA, even though the RUS will start with less money and will serve less populated areas,” he said.

Implementation rules and timetables will be available for viewing at www.ntia.doc.gov/broadbandgrants or www.usda.gov/rus.

Each agency intends to offer three portions of funding, each probably representing roughly one-third of the total. Applications for the first portion are likely to be due in the second or third quarter of 2009, with payouts in the third or fourth quarter. Applications for the second portion are likely to be due in the fourth quarter, and applications for the third portion are likely to be due in the second quarter of 2010. All payouts are likely to be completed by the end of June 2010.

Once the payouts are made, contractors can watch for projects to go to bid for external broadband infrastructure, which inevitably will be followed by building infrastructure projects to distribute broadband inside structures that previously had no access to the information superhighway.

MUNYAN is a freelance writer in Olathe, Kan., specializing in technical and business writing. He can be reached at www.russwrites.com.