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States Seek Partnership with NTIA, RUS over Stimulus Funds

WASHINGTON—The National Association of Regulatory Utility Commissioners, in a letter today signed by 90 regulators from 39 States, urged the Obama Administration today to work closely with their State counterparts as they determine how to disburse nearly $7 billion in broadband infrastructure grants.

In the letter to Dept. of Commerce Secretary Gary Locke, Dept. of Agriculture Secretary Tom Vilsack, and Assistant Commerce Secretary for Communications and Information Anna Gomez, NARUC said that given the tight time frame to release the money, and the other responsibilities these agencies have, the Administration should turn to the States for help.

At issue is the $6.8 billion in broadband infrastructure and program grants included in the American Recovery and Reinvestment Act of 2009. The bill designates USDA's Rural Utilities Service and Dept. of Commerce's National Telecommunications and Information Administration as the agencies responsible for establishing guidelines and disbursing the ARRA grant money.

According to the State regulators, there is not enough time or staff for either RUS or NTIA to release and monitor the funds effectively. Instead, as Congress suggested, the agencies should seek the assistance of States to ensure the money gets out efficiently and quickly.

"Rather than contracting with Washington, D.C., consultants that lack both the States’ in-depth knowledge about the areas covered and inherent incentive to do the job right, both agencies should structure the program to insure State involvement," the letter said.

NARUC said the agencies should ask governors to specify a State entity to review and rank all in-State project applications based on specified criteria, while NTIA or RUS will make the final funding choices and disburse the funds. As an incentive for States to participate in the screening process, NTIA and RUS should establish, for the first round of funding, a "use or lose" minimum standard allocation for each State. States would have the opportunity, assuming enough qualified proposals were submitted, to assure up to that allocation is disbursed in-state. NARUC's letter also suggests the federal agencies make minimal funding available to allow short term hires to assist State experts in screening applications and in monitoring grant implementation.

“The advantages to this approach are obvious,” the State regulators said. “It saves resources, puts the people with the information needed to make reasonable and rapid decisions in a strong advisory role, provides an additional layer of accountability, and significantly increases the chances that the money will actually get disbursed as States will have proper incentives to both opt-in and complete the task.”

NARUC is a non-profit organization founded in 1889 whose members include the governmental agencies that are engaged in the regulation of utilities and carriers in the fifty States, the District of Columbia, Puerto Rico and the Virgin Islands. NARUC's member agencies regulate telecommunications, energy, and water utilities. NARUC represents the interests of State public utility commissions before the three branches of the Federal government.