WASHINGTON, April 23, 2014 – Stakeholders involved in the effort to expand broadband service in rural America say economic, legal and policy concerns often get in the way, according to a report from the Government Accountability Office.
The American Recovery and Reinvestment Act of 2009 directed the Federal Communications Commission to develop a national broadband plan to ensure every American had access to broadband service, the report noted. In 2010, the FCC said about 5 percent of the country’s 7 million household units lacked access to broadband service. It also estimated that it would cost $23.5 billion to reach all unserved areas of the country, with $13.4 billion needed to just reach the most remote 250,000 households.
Sponsors of projects to expand service, broadband providers and industry experts said the high costs are generally due to the expense of deploying technologies over long distance and sometimes difficult terrain, often to relatively few potential subscribers. According to the FCC, costs for new fiber construction can range from $11,000 to $24,000 per mile for aerial construction, to $25,000 to $165,000 per mile for buried construction.
While federal grants can often reduce project costs, sponsors told GAO investigators that they were challenged by a lack of clear information about which federal funds were available, who can make use of the money, and how to apply for grants. One sponsor from a small town said his staff lacked the expertise necessary to meet reporting requirements.
Industry experts also said that some states have laws that ban companies that are not telecommunications companies from deploying broadband, on the basis that it creates unfair competition.
While the FCC is the lead agency in expanding broadband service, USDA also plays a role by administering three Rural Utilities Service programs: the Rural Broadband Access Loan and Loan Guarantee Program, the Community Connect Grant Program, and the Telecommunications Infrastructure Loan Program. USDA provided over $7 billion in grants and loans for broadband projects from 2008 through 2012.
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