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FCC Internet Grant Decision Riles Congress
museumpeace writes "The FCC, with no advance notice to congress, effectively made substantial cuts in the funding for the program that subsidizes provision of internet connection to libraries and poorer school systems. This was not small potatoes: 2.5 billion buys a lot of connection. [confess your real identity to them and the ]
NYTimes will tell you all about the uproar. The ostensible cause according to FCC officials, who annoyed congressfolk by dodging the inquiry, was an attemp to control possible fraudulent spending in the program but FCC actions then went far beyond fiscal oversight. FCC deference to phone companies by way of reducing the amount they were required to contribute to the program has compounded its financial woes according to Technology Review which also covered the story. [and which will also require a "free" registration]"
The E-Rate Program was incredibly corrupt with lots of companies getting illegal kickbacks. They had to restrict it so they could at the very least clean it up. I don't see how allowing things to continue as they were was a good idea.
Internet Grants Cut, and F.C.C. Scolded
By STEPHEN LABATON
Published: October 6, 2004
ASHINGTON, Oct. 5 - The Federal Communications Commission came under sharp criticism in Congress on Tuesday over a series of decisions that have led to the suspension of a $2.25 billion program that pays for telephone and Internet services at public schools and libraries.
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The suspension, which began without notice two months ago, has caused hardships in many school districts and communities, which have had to postpone paying bills or take money from other projects. By one estimate, as much as $1 billion in expected grants could be suspended by the end of the year.
The company that administers the program issued a suspension on new grants as it wrestled with new accounting standards and tighter spending limits imposed on it by the F.C.C.
A hearing Tuesday before the Senate Commerce Committee had originally been called to examine waste at the so-called E-Rate program, which administers telephone and Internet services for schools and libraries. But three of the four senators present focused instead on the F.C.C.'s decision to impose tighter spending restrictions.
The fourth senator, John McCain of Arizona, the Republican chairman of the committee, pressed the witnesses about what steps were being undertaken to monitor the program in light of a series of fraud cases involving telephone companies and equipment makers over the last few years. He expressed irritation that Congress had not been notified about the suspension of the program.
Frank Gumper, the chairman of the Universal Service Administrative Company, the nonprofit organization that oversees the E-Rate program, told lawmakers that the F.C.C.'s decision last week to order a quick sale of more than $3 billion of the program's investments had resulted in a loss of almost $5 million.
Guidelines for making those investments had been approved in July by top officials in the office of Michael K. Powell, chairman of the F.C.C. But the investments had to be liquidated after the commission later concluded that they impinged on the company's ability to make payouts to schools and libraries.
Commission officials, who declined a request by the senators to appear at the hearing, have said that spending changes were necessary to audit and monitor the program more effectively. The officials have said they imposed the new restrictions in consultation with the White House budget office. But late last week, administration officials began distancing themselves from the changes, noting that the budget office has never issued a formal opinion on the matter.
At Tuesday's hearing, lawmakers and an executive of Universal Service said that many of the most significant changes would not make it easier to perform audits or root out fraud and waste.
That acknowledgment prompted concern from the lawmakers.
"It's really difficult to understand why these changes were made,'' said Senator Olympia J. Snowe, a Maine Republican who helped draft the legislation that created the E-Rate program in 1996.
Senator Conrad Burns, Republican of Montana, also criticized the tighter regulations, which have led to a cash squeeze at the program, and the recent quick sale of the program's investments.
"I fail to see how these series of events have led to a more efficient management of the funds,'' he said.
Senator John D. Rockefeller IV, a West Virginia Democrat, criticized the F.C.C.'s decision to reduce the contribution level by telephone companies and their customers by $550 million this year, only to find that the E-Rate program, under the new rules, is likely to suffer from a cash squeeze and may need to increase tariffs later to pay schools and libraries.
He and Ms. Snowe also criticized the commission's decision not to send any officials to the committee who could explain the decision to tighten the spending rules.
"I'm very disappointed that the F.C.C. declined to
Since the FCC is worried about government overspending, they should be rewarded with an equal amount of reduction in funding for them.
The reduction can be used to then pay for the libraries (and underprivileged) to get internet access.
I remember hearing about how this program was providing funds to school districts that really didn't know what things cost. I think it was the El Paso school district that wound up being sold a few $million worth of Cisco gear that was never installed because it wasn't part of the IS architecture plans, drawn by the same people that sold the gear.
All in all, this is a program that should have started really big to make initial investments in hardware, but cut back a little to just maintain.
Bacardi + slashdot = negative karma.
So, the FCC has stopped paying out- Yet it's still on my cell bill, where are the funds piling up? the FCC coffers? or the telco?
fwiw, I have no problem subsidizing a telephone to a city of 200 in W VA that can't run at a profit.
every day http://en.wikipedia.org/wiki/Special:Random
So it's okay for the FCC to create a new tax without congressional oversight, but if they ever decide to get rid of that same tax, there's an uproar?
I actually worked on an E-rate project in a large urban area. Graft and corruption do not begin to describe the money sucking machine that was E-rate. So I speak with some authority on the subject when I say that we are all better off without it.
I've read of massive hardware installations and billing done at small schools, all by unscrupulous companies and oblivious administrators, at the public expense. Any time you have this kind of blank check, and any time its 'for the children', you're going to get this kind of graft. The only solution is to stop taxing long distance bills (read your phone bill some time), and make local communities fork over the cash - they will buy what they can afford or what they need, no more, no less. It will spark creative ways of managing networks, combining services with adjacent communities, community involvement, and basically return the $$ spent back to the local vendors (with the exception of the hardware cost). Inject Gubmint monopoly money, and of course the costs will explode - look at the medical industry in the US for an example.
I want to delete my account but Slashdot doesn't allow it.
The executive agencies have a responsibility to cut off public funds when they have a very good reason to believe they are being subject to fraud, waste and abuse. GSA, the General Services Administration, does this sort of thing all the time when it does internal criminal audits of how Congressionally-allocated funds are being used. One of their jobs is to bust up slush funds and take down those who were using them. Do you honestly think they let someone just spend all of those tax dollars all the way through the investigation?
The Congress desparately needs to have its spending and law-making powers curtailed by a few good constitutional amendments. The President needs the power of line-item veto, the Congress needs to have every bill address only one subject with all riders to the contrary automatically ruled unenforceable and deficit spending when the Congress has not issued a formal declaration of war should be unconstitutional.
I applaud the FCC, it's about damn time that an executive agency told Congress to take responsibility for where it spends tax dollars. The Congress spends our money, which it confiscates by threat of prison time, like a bunch of rich old white businessmen at a Vegas strip club. As long as the FCC just keeps the funds tied up, it shouldn't have any legal trouble. Since it is saying that it is merely tying up the funds to prevent them from going to what evidence shows is most likely an illegal use, it doesn't have to ask the Congress for permission. The Constitution doesn't say that the executive agencies have to actually spend money for purposes known to be illegal under federal law....
Click here or a puppy gets stomped!
The plus side to this mess is that the FCC is going to so thoroughly piss off Congress that it could mean good things in terms of the Broadcast Flag and the EFF's argument that the FCC is overstepping its Congressionally-granted bounds in that matter. This certainly isn't the first case where Michael Powell found himself at odds with Congress.
When there is proper oversight. For the last 5 years I have been directly involved in wonderful education projects that would not be possible without E-Rate funding. Many, many schools in the state where I live would not even have Internet access were it not for E-Rate funds and most would be stuck at ISDN speeds for hundreds of students per school. I have seen first hand the power of distance learning in cooperation with Universities, use of web resources for students such as Atomic Learning and NetTrekker, online teacher recertification training to be compliant with NCLB, and the ability for districts and states to modernize a significant portion of their daily administrative tasks such as attendance reporting, Free and Reduced Lunch tracking and centralized student information systems by bringing them all online. The savings in administration overhead are significant by themselves. All of this is possible because of E-Rate.
What people don't seem to realize is that most school districts are poor. They have very restricted budgets with little lee-way. E-Rate allows them to bring modern technology into the hands of students who most likely don't get to utilize it at home and educational resources that they most certainly wouldn't be able to use or even access at home.
A properly managed E-Rate fund with proper accounting and oversight is essential to the education of our future. The sensationalist examples of waste given in response to this article are exceptions and not the general rule. NASA had the same types of problems years ago. NASA wasn't abolished or suspended. Instead, they were forced to get their act together and perform proper accounting and oversight. That's the right way and what needs to happen here.
Omeganon
Maybe because the editors want to honour the other sites requirements? Besides, it isnt the editors that write the italic blurb, its the article submitter that does that, editors comments are usually in plain face after the submitters blurb.
Seriously, Slashdot editors have no place at all of suggesting methods of circumventing other sites login requirements. If they did, how long until NYtimes blocks referers from slashdot? How would slashdot feel if there was a bugmenot type site for slashdot itself? To view the article you need to log in, thats the casual agreement and cost of viewing the article, the same as having a unique ID on this site. Just because its on the Internet does not mean you have a Carte Blanche right to view it on your terms.
As a former Director of Technology for a school district in Missouri, I had to deal very closely with the e-rate system. In concept, e-rate/universal service fund was supposed to level the playing field for poor districts whose tax base could not support the kind of technology enhancements that would allow students in those districts to compete with those in districts with a higher tax base that could afford the services if they wanted it.
The problem as I see it is the Administrators don't know when they are being taken for a ride by the "consulting companies" that they bring in to do the work. I was one of the few administrators who was a technology professional to begin with. Most districts I had contact with just add the technology planning and administration to the duties of a Math, Science, or Business teacher. They don't traditionally have the information technology background to form a plan of attack for the district to follow, and instead just let the "consultants" tell them what to do. That gives the consultants the needed loophole to overcharge and under-deliver.
You went to the library seeking information. That's what a library is all about. It's irrelevant as to how the information is packaged - magazine, newspaper, hardcover book ... that's just the transport mechanism. You went seeking information. Internet access is a logical extension of the library's charter, so it makes a ton of sense. If you don't want to read some grungy old book that's been thumbed through by countless "unfortunate souls," that's your prerogative; you can purchase a shiny new one at a bookstore. Same goes for your internet access.
... In order to truely prosper, you (we) need to provide infrastructure to all areas, not just the ones that are economically feasible. And yes, you (we) get to foot the bill.
All countries run "social programs." Roads are built with tax money or under charter from the gub'ment. Same goes for providing potable water, electricity, sewer