Rural Broadband Stimulus Program Slammed in Government Report

A key stimulus program to bring Internet service to rural America may not be up to the job.

Photo by Steve Webel

Fight disinformation: Sign up for the free Mother Jones Daily newsletter and follow the news that matters.


This story first appeared on ProPublica.org.

A key stimulus program to bring Internet service to rural America may not be up to the job of spending its $2.5 billion in extra funding effectively, according to a report (PDF) released Monday by the U.S. Department of Agriculture’s inspector general.

The Rural Utilities Service’s broadband program faced heavy criticism in 2005 when auditors found irregularities (PDF) with a quarter of the funds the program had received in its first four years of operation. In one case, the program loaned $45 million to wire affluent subdivisions in the Houston suburbs—including one that was built around a golf course and another outside one of the richest cities in Texas.

Monday’s report found that the Rural Utilities Service continues to grant loans to areas that already have broadband service and to communities near major cities.

“We remain concerned with RUS’ current direction of the broadband program, particularly as they receive greater funding under the American Recovery and Reinvestment Act,” Assistant Inspector General Robert W. Young wrote. “RUS’ broadband program may not meet the Recovery Act’s objective of awarding funds to projects that provide service to the most rural residents that do not have access to broadband service.”

In written comments attached to the report, the Agriculture Department said the law creating the broadband program contained no restrictions as to proximity to major cities. “Rural” was defined only as a community with fewer than 20,000 people.

More than 90 percent of the loan applications the agency has approved since the critical report in 2005 went to areas that already had broadband service, the report said. “OIG remains concerned because the overwhelming majority of communities…receiving service through the broadband program already have access to the technology,” Young wrote.

Agriculture Department officials declined to comment further Monday evening.

In nearly every speech about the federal stimulus package, President Obama has touted an initiative to expand broadband access to millions of Americans in underserved rural areas. Such an expansion, supporters say, would aid small businesses and improve access to health care and distance learning programs.

The stimulus package, passed by Congress in early February, provides $7.2 billion for broadband grants and loans. A Commerce Department agency will manage $4.7 billion while the Agriculture Department’s Rural Utilities Service will manage $2.5 billion.

That’s nearly twice as much as the rural broadband program has given out in loans over the last eight years.

The inspector general’s report also noted that 148 communities that receive broadband service funded by agency loans were within 30 miles of cities with more than 200,000 people, including communities outside Chicago and Las Vegas.

According to the Agriculture Department’s most recent report on April 3, none of the stimulus money for broadband grants has been awarded or spent.

AN IMPORTANT UPDATE

We’re falling behind our online fundraising goals and we can’t sustain coming up short on donations month after month. Perhaps you’ve heard? It is impossibly hard in the news business right now, with layoffs intensifying and fancy new startups and funding going kaput.

The crisis facing journalism and democracy isn’t going away anytime soon. And neither is Mother Jones, our readers, or our unique way of doing in-depth reporting that exists to bring about change.

Which is exactly why, despite the challenges we face, we just took a big gulp and joined forces with the Center for Investigative Reporting, a team of ace journalists who create the amazing podcast and public radio show Reveal.

If you can part with even just a few bucks, please help us pick up the pace of donations. We simply can’t afford to keep falling behind on our fundraising targets month after month.

Editor-in-Chief Clara Jeffery said it well to our team recently, and that team 100 percent includes readers like you who make it all possible: “This is a year to prove that we can pull off this merger, grow our audiences and impact, attract more funding and keep growing. More broadly, it’s a year when the very future of both journalism and democracy is on the line. We have to go for every important story, every reader/listener/viewer, and leave it all on the field. I’m very proud of all the hard work that’s gotten us to this moment, and confident that we can meet it.”

Let’s do this. If you can right now, please support Mother Jones and investigative journalism with an urgently needed donation today.

payment methods

AN IMPORTANT UPDATE

We’re falling behind our online fundraising goals and we can’t sustain coming up short on donations month after month. Perhaps you’ve heard? It is impossibly hard in the news business right now, with layoffs intensifying and fancy new startups and funding going kaput.

The crisis facing journalism and democracy isn’t going away anytime soon. And neither is Mother Jones, our readers, or our unique way of doing in-depth reporting that exists to bring about change.

Which is exactly why, despite the challenges we face, we just took a big gulp and joined forces with the Center for Investigative Reporting, a team of ace journalists who create the amazing podcast and public radio show Reveal.

If you can part with even just a few bucks, please help us pick up the pace of donations. We simply can’t afford to keep falling behind on our fundraising targets month after month.

Editor-in-Chief Clara Jeffery said it well to our team recently, and that team 100 percent includes readers like you who make it all possible: “This is a year to prove that we can pull off this merger, grow our audiences and impact, attract more funding and keep growing. More broadly, it’s a year when the very future of both journalism and democracy is on the line. We have to go for every important story, every reader/listener/viewer, and leave it all on the field. I’m very proud of all the hard work that’s gotten us to this moment, and confident that we can meet it.”

Let’s do this. If you can right now, please support Mother Jones and investigative journalism with an urgently needed donation today.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate