Should USDA manage broadband funds?

The economic stimulus plan now moving through Congress has $1.5 billion in it that would be managed by the Agriculture Department's Rural Utilities Service to help connect rural communities to broadband Internet.

While that is only part of the $6 billion intended for broadband hookups, critics are complaining that USDA's Rural Utilities Service has not done a very good job in managing Internet money in the past. The USDA's inspector general found that $236 million or more than one-quarter of the program's loans that were reviewed were "either not used as intended, not used at all, or did not provide the expected return of service."

The abuse was shocking. The Inspector General found that $45.6 million went to wire several luxury subdivisions near Houston. An estimated $430,000 went to a Lubbock, Texas high-speed Internet service provider that used the money for pilot lessons for its president and treasurer.

President Obama has pushed for stimulus funding for broadband Internet in underserved areas to create new jobs while also providing better economic, educational and health-care opportunities. Critics of the rural utilities service fund said the president's goal could be derailed by lax oversight at the USDA. They argue that the National Telecommunications and Information Administration, the tech-policy making arm of the White House, has expertise in administering large grants and is better suited to deal with wireless, fiber optics and cable modem service.

"Putting broadband funds into the RUS is just a bad idea. You don't see the Federal Communications Commission putting dairy farms near telephone lines. It's just bad policy," said Ben Scott, policy director of public interest group Free Press.

Nevertheless, Agriculture Secretary Tom Vilsack said changes have been made in oversight. He said his new staff has experience bringing broadband lines to rural areas and should be given a chance to prove their ability to govern such a program.

For more on USDA and broadband:
- see this Washington Post article

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Economic stimulus plan news from FierceGovernmentIT