Grants boost rural broadband

USDA Rural Development

As part of an effort to improve rural communities' access to broadband Internet, the Agriculture Department's Rural Development program announced May 16 it has awarded $20 million in grants to 40 communities in 16 states and a U.S. territory.

About $8.2 million of the grant money will go to 13 American Indian and Alaskan native communities. Recipients were selected from a field of more than 300 applicants from eligible rural communities — those with 20,000 or fewer inhabitants.

Most of the grants, which have matching requirements, are awarded to companies working on broadband or telecommunications projects in a particular community. However, several recipients are the tribes or municipalities themselves.

"That's a good first step," said Damian Kunko, chief executive officer with the Rural Broadband Coalition, an advocacy group that is promoting greater broadband development in underserved rural areas. Its membership includes government stakeholders, telecommunications and utility companies, small Internet service providers, and other associations.

In the fiscal 2003 federal budget, $1.5 billion will be made available for loans and loan guarantees for the construction and improvement of, and acquisition of facilities and equipment for broadband service in eligible rural communities. Kunko said tax credit programs also exist for companies investing in rural communities.

Because larger telecommunications companies see little return on their investments in rural-area infrastructure, the federal government, in essence, is acting on behalf of communities and subsidizing programs to spur investment, he said.

USDA's Rural Development, for example, facilitates infrastructure improvement of public utilities and services as well as economic development in rural areas.

According to a Pew Internet and American Life Project report released May 18, high-speed Internet adoption at home increased by 50 percent from March 2002 to March 2003. About 30 million Americans have a broadband connection at home.

However, the report noted that a survey conducted late last year showed that people who say they cannot get high-speed Internet are twice as likely to live in rural areas.