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State Offers Internet Grants

Posted on: Thursday, 20 October 2005, 18:00 CDT

By TIM LANDIS BUSINESS EDITOR

State regulators are putting $5 million worth of matching grants toward efforts to bring high-speed Internet connections to rural and other underserved areas.

The Digital Divide Elimination Infrastructure Fund was created by 2001 reforms of Illinois' telecommunications law with the goal of bringing broadband to at least 80 percent of local phone customers by Jan. 1, 2005.

But state budget problems, legislative revisions and regulatory proceedings delayed start of the program until this month.

"It's open to anybody and everybody who has some ability to provide broadband service," said Jon Feipel, assistant director of the telecommunications division for the Illinois Commerce Commission.

The matching grants are limited to 25 percent of a project's cost, up to $1 million.

"People certainly can apply for $25,000, if their project is going to be small. The $1 million is a cap," Feipel said, adding that applicants could range from start-up companies and small businesses to municipalities and school districts.

Applicants also must document the financial ability to build and operate a broadband network.

SBC Communications agreed to set aside $30 million for expansion of broadband networks to underserved areas as part of the 2001 reforms. The first $15 million went into a state program that largely targeted urban areas.

The remaining $15 million was to go primarily to rural areas.

Legislative revisions - including a 2004 diversion of funding to a program that provides print media for the visually impaired - reduced the amount available to $5 million. Eligibility rules also were revised.

Douglas Dougherty, president of the Illinois Telecommunications Association, said broadband has been extended to many smaller communities since the 2001 reforms were approved. The association represents approximately 60 phone and wireless companies.

"I would be hard pressed to find a rural community that did not have at least one provider of broadband, be it cable, the incumbent local phone providers, be it satellite or wireless," Dougherty said.

But he said the major phone companies often bypass small towns and rural areas because of the cost of extending broadband to sparsely populated areas.

"It will be interesting to see how the commission determines whether there is high-speed connectivity in these communities," he said.

Feipel said the grant guidelines were intended to encourage a variety of applications before a Dec. 15 deadline. The ICC will review each application and expects to announce grants in the spring of 2006.

He added that no additional money is expected after the $5 million has been awarded.

"At it stands today, it's a onetime contribution," he said.

Applications are available at www.icc.illinois.gov/tc/ tcddelim.aspx.

Source: State Journal Register

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