July 9, 2009 - Hill Country Telephone's Wilson Testifies at House Hearing

Arlington, Va., July 9, 2009 - Support from the RUS and NTIA broadband funding incentives will be critical to rural telcos' ability overcome the economic challenges of delivering ubiquitous broadband to the most sparsely populated areas of rural America, according to testimony by Delbert Wilson, general manager of Hill Country Telephone Cooperative (Ingram, Texas).

Wilson testified Thursday on behalf of the National Telecommunications Cooperative Association (NTCA) before the House Agriculture Subcommittee on Rural Development, Biotechnology, Specialty Crops, and Foreign Agriculture at its hearing on broadband programs.

In his testimony, Wilson described his company's $57 million plant modernization project, designed to provide the broadband infrastructure necessary to support consumers' growing bandwidth needs. Yet despite the efforts, 543 households-nearly five percent of the company's service territory-will remain without broadband because of the overwhelming costs associated with serving such remote areas.

Wilson noted that despite the best efforts of rural carriers, there are still pockets of unseved areas that he termed "economic realities" It is in these markets, still lacking in consumer choice, where stimulus funding will be most important. To achieve the stimulus objectives of increasing broadband access and inciting economic development-and to ensure the stimulus funding does not yield unintended consequences-Wilson pointed to key areas of concern to rural providers, including:

  • "The importance of directing funding to unserved areas first;
  • "The possibility that the $400 million provided for "last mile" projects may not be sufficient given the extremely high costs of building out to those areas;
  • "The need for rural providers to retain their right to effectively manage their networks.

Wilson also recommended the following changes to the RUS Broadband Loan program:

  • "Require a 20% credit support of the requested loan amount, since broadband providers who cannot meet the 20% threshold will not likely have sufficient financial stability to maintain service to their customers;
  • "Increase the deadline for project completion from three to five years;
  • "Lengthen to 60 or 90-working-days the notice period for incumbents, to provide them more time to see and respond to new applications;
  • "Require all applicants to submit a market survey-a painstaking part of the RUS loan process intended to protect the American taxpayer.

Wilson also encouraged the committee to continue its support of the RUS Community Connect grant program which provides financial assistance to establish community-oriented broadband points of presence in areas of great need. He noted that the stimulus funding initiatives, combined with the programs outlined above along with universal service and the intercarrier compensation regime will enable America's community-based telcos to meet the broadband needs of rural Americans.

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"We emerged in these markets where no one else was willing to go. We understand these markets and what their needs are," Wilson concluded. "We are committed to these markets because our systems are locally owned and operated…and we understand the programs and how to utilize them to achieve your goal of ubiquitous broadband deployment."

View Wilson's testimony

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The National Telecommunications Cooperative Association is the premier association representing more than 560 locally owned and controlled telecommunications cooperatives and commercial companies throughout rural and small-town America. NTCA provides its members with legislative, regulatory and industry representation; meetings; publications and educational programs; and an array of employee benefit programs. Visit us at www.ntca.org.