House Commerce Committee Seeks Documents on RUS Broadband Loan to Bankrupt Open Range

The House Commerce Committee is seeking info on a $267 million broadband development loan from the Rural Utilities Service to Open Range Communications, which has recently filed for bankruptcy.

The loan precedes RUS' loans of billions under a broadband stimulus bill, and was approved in March 2008. Open Range apparently received the biggest loan the program issued, according to the legislators, which included both Republican and Democratic leadership. Open Range filed for bankruptcy on Oct. 6 and could leave the taxpayers on the hook for $73.5 million, the amount RUS had already ponied up. In addition, Open Range could owe another $26 million to businesses that did work for it, they said. The RUS program, which is headed by former FCC Commissioner Jonathan Adelstein, has come under fire from the Department of Agriculture's Inspector General, who raised concerns about the majority of the broadband loans and loan guarantees it reviewed ($340 million worth out of $599 million) either because of incomplete applications, defaulted loans and funds used for "inappropriate purposes."