Lennard G. Kruger
Specialist in Science and Technology
Resources, Science, and Industry Division
Angele A. Gilroy
Specialist in Telecommunications
Resources, Science, and Industry Division
On April 20, 2007, the Congressional Research Service released an update to its report on Federal assistance programs aimed at expanding broadband access.
While the numbers of new broadband subscribers continue to grow, studies conducted by the Federal Communications Commission (FCC), the Department of Commerce (DOC), and the Department of Agriculture (USDA) suggest that the rate of broadband deployment in urban and high income areas may be outpacing deployment in rural and low-income areas. Legislation introduced (but not enacted) in the 109th Congress sought to provide federal financial assistance for broadband deployment in the form of grants, loans, subsidies, and tax credits. Many of these legislative proposals either have been or are likely to be reintroduced into the 110th Congress. Of particular note is the possible reauthorization of the Rural Utilities Service (RUS) broadband program, which is expected to be considered as part of the 2007 farm bill. Legislation to reform universal service — which could impact the amount of financial assistance available for broadband deployment in rural and underserved areas -- has been introduced into the 110th Congress (H.R. 42, S. 101, S. 711), as well as other legislation related to broadband and the digital divide (H.R. 1818, S. 541, S. 761, S. 1032). In assessing such legislation, several policy issues arise.
- Is the current status of broadband deployment data an adequate basis on which to base policy decisions?
- Is federal assistance premature, or do the risks of delaying assistance to underserved areas outweigh the benefits of avoiding federal intervention in the marketplace?
- If one assumes that governmental action is necessary to spur broadband deployment in underserved areas, which specific approaches, either separately or in combination, are likely to be most effective?
The report includes a six-page list of Federal telecommunications development programs.
The report notes that obtaining an accurate snapshot of the status of broadband deployment is problematic.
On the debate over the need for Federal assistance, the CRS relays that some argue that without some governmental assistance in underserved areas it is reasonable to conclude that broadband deployment will lag behind in many rural and low income areas. On which approach might be best, the CRS notes a couple of approaches: Targeted grants and loans from several existing federal programs and tax credits for companies deploying broadband systems in rural and low-income areas. CRS asks:
- How might the impact of federal assistance compare with the
effects of regulatory or deregulatory actions? - How might any federal assistance programs best compliment existing “digital divide” initiatives by the states, localities, and private sector?