NCTA Says RUS Should Stop Broadband Loans Until Rules Are Fixed [Multichannel News]
The Department of Agriculture's Rural Utilities Service (RUS) has instituted interim rules for its distribution of broadband development loans. However, the National Cable and Telecommunications Association (NCTA), the cable industry's trade association, has filed comments with the RUS that these rules do not fix the program's many problems and should be fixed before any more loans are distributed.
The program has received its fair share of criticism for failing to meet the intended purpose of delivering broadband to areas that aren't served by broadband, instead funding a number of applicants to build networks in areas that are already served by other providers, resulting in government-subsidized competitive providers.
The NCTA proposes that broadband loans should be given to areas that are totally unserved as a top priority. The next tier of broadband loan distributions should be targeted to areas where the unserved make up more than 75% of all area households. The FCC and the NTIA (National Telecommunications & Information Administration) both keep records that better define "unserved," as compared to the RUS's internal records.
The NCTA has also objected to the RUS practice of including Universal Service Fund (USF) disbursements in loan repayment calculations. The FCC has plans to reform the out-dated USF, and there are good questions about whether it makes sense for the RUS to use a system that is admittedly out-dated to determine what these government-subsidized service providers should have to repay.