[Congressional Record Volume 157, Number 148 (Wednesday, October 5, 2011)]
[House]
[Pages H6570-H6572]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




     RETURNING RECLAIMED BROADBAND STIMULUS FUNDS TO U.S. TREASURY

  Mr. WALDEN. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 1343) to return unused or reclaimed funds made available for 
broadband awards in the American Recovery and Reinvestment Act of 2009 
to the Treasury of the United States, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 1343

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. ACCOUNTABILITY FOR BROADBAND STIMULUS FUNDS.

       (a) In General.--Notwithstanding any other provision of 
     law, the Administrator of the Rural Utilities Service or the 
     Assistant Secretary of Commerce for Communications and 
     Information shall take prompt and appropriate action to 
     terminate for cause any award made under the Broadband 
     Initiatives Program or the Broadband Technology Opportunities 
     Program, respectively, established pursuant to the American 
     Recovery and Reinvestment Act of 2009, if the Administrator 
     or Assistant Secretary determines that cause exists to 
     terminate the award. Such cause may include an insufficient 
     level of performance, wasteful spending, or fraudulent 
     spending.
       (b) Deobligation and Return of Funds to Treasury.--
       (1) Deobligation.--Upon terminating an award under 
     subsection (a), the Administrator or the Assistant Secretary 
     shall immediately deobligate an amount equivalent to such 
     award, less allowable costs, to the extent funds with respect 
     to such award are available in the account relating to the 
     Broadband Initiatives Program or the Broadband Technology 
     Opportunities Program, respectively. If the Administrator or 
     the Assistant Secretary subsequently recovers any additional 
     amounts from such award, the Administrator or the Assistant 
     Secretary shall deobligate such additional amounts 
     immediately upon receipt.
       (2) Return to treasury.--Not later than 30 days after 
     deobligating an amount under paragraph (1), the Administrator 
     or the Assistant Secretary shall, without exception, return 
     such amount to the general fund of the Treasury of the United 
     States.
       (3) No expenditures during termination process.--The 
     Administrator or the Assistant Secretary shall promptly 
     pursue available corrective measures to ensure that funds 
     received through an award terminated under subsection (a) are 
     not expended during the termination process.
       (4) Accounting by award recipient.--The Administrator or 
     the Assistant Secretary shall direct the recipient of an 
     award terminated under subsection (a) to provide to the 
     Administrator or the Assistant Secretary a complete and 
     accurate accounting, which may include an independent 
     accounting, for any award funds that, as of the date of 
     termination, the recipient has received but has not expended 
     on allowable costs.

     SEC. 2. DISPOSITION OF UNUSED FUNDS.

       The Administrator of the Rural Utilities Service or the 
     Assistant Secretary of Commerce for Communications and 
     Information shall return to the general fund of the Treasury 
     of the United States an amount equivalent to any award, less 
     allowable costs, made under the Broadband Initiatives Program 
     or the Broadband Technology Opportunities Program, 
     respectively, established pursuant to the American Recovery 
     and Reinvestment Act of 2009, if such award has been returned 
     to the Administrator or Assistant Secretary or disclaimed by 
     the award recipient at any time after the date of enactment 
     of such Act.

     SEC. 3. OVERSIGHT AND REPORTING REQUIREMENTS.

       (a) Action on Information From OIG or GAO.--If the 
     Administrator of the Rural Utilities Service or the Assistant 
     Secretary of Commerce for Communications and Information 
     receives information from an official described in subsection 
     (b) with respect to an award made under the Broadband 
     Initiatives Program or the Broadband Technology Opportunities 
     Program, respectively, established pursuant to the American 
     Recovery and Reinvestment Act of 2009, and such information 
     pertains to material noncompliance with the award terms or 
     provisions or improper usage of award funds, the 
     Administrator or the Assistant Secretary shall--
       (1) immediately review such information; and
       (2) not later than 30 days after receiving such 
     information, determine whether cause exists to terminate such 
     award under section 1(a), unless the official who provided 
     such information recommends that the Administrator or the 
     Assistant Secretary limit or not make such a determination.
       (b) Officials Described.--The officials described in this 
     subsection are the following:
       (1) With respect to the Broadband Initiatives Program, the 
     Inspector General of the Department of Agriculture.
       (2) With respect to the Broadband Technology Opportunities 
     Program, the Inspector General of the Department of Commerce.
       (3) The Comptroller General of the United States.
       (c) Congressional Notification.--
       (1) In general.--Not later than 3 days after making a 
     determination described in subsection (a)(2), the 
     Administrator or the Assistant Secretary shall provide a 
     notification of such determination to--
       (A) the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture of the 
     Senate or the Committee on Energy and Commerce of the House 
     of Representatives and the Committee on Commerce, Science, 
     and Transportation of the Senate, respectively; and
       (B) the official who provided the information described in 
     subsection (a).
       (2) Contents of notification.--The notification required by 
     paragraph (1) shall include an explanation of--
       (A) the determination described in subsection (a)(2); and
       (B) any action taken as a result of the determination or 
     why no action was necessary.
       (3) Confidential notification under certain 
     circumstances.--In the case of a determination by the 
     Administrator or the Assistant Secretary under subsection 
     (a)(2) that cause does not exist to terminate the award, the 
     Administrator or the Assistant Secretary may make the 
     congressional notification required by paragraph (1)(A) on a 
     confidential basis, if the Administrator or the Assistant 
     Secretary determines, after consultation with the official 
     who provided the information described in subsection (a), 
     that--
       (A) there is no merit to such information; and
       (B) notification on a public basis would cause irreparable 
     harm to any person the information is regarding.

     SEC. 4. CONFORMING AMENDMENTS.

       Section 6001(i)(4) of the American Recovery and 
     Reinvestment Act of 2009 (47 U.S.C. 1305(i)(4)) is amended--
       (1) by striking ``may'' and inserting ``shall''; and
       (2) by striking ``, and award these funds competitively to 
     new or existing applicants consistent with this section''.

     SEC. 5. AWARD DEFINED.

       In this Act, the term ``award'' includes grants and loans.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Oregon (Mr. Walden) and the gentlewoman from California (Mrs. Capps) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Oregon.


                             General Leave

  Mr. WALDEN. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days in which to revise and extend their remarks and 
insert extraneous materials in the Record.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Oregon?
  There was no objection.
  Mr. WALDEN. Mr. Speaker, I yield myself such time as I may consume.
  First of all, I want to thank my colleague from New Hampshire, 
Charlie Bass, who has really worked hard on this issue to bring about 
greater accountability and oversight of how American taxpayer dollars 
are being allocated under the American Recovery and Reinvestment Act, 
especially to make sure that when the money comes back that it's really 
clear with these agencies that it goes back to pay down the deficit and 
doesn't end up in some sort of slush fund, and my colleague Mr. Bass 
has played a real leadership role in both crafting this legislation and 
making sure it comes to the House at this time.
  Mr. Speaker, the American Recovery and Reinvestment Act allocated 
approximately $7 billion in taxpayer

[[Page H6571]]

money to two broadband-related grant and loan programs. One was 
administered by the National Telecommunications and Information 
Administration and the other by the Rural Utility Service. The wisdom 
of creating these programs and whether the money should have been 
better targeted to unserved households has been the subject of ongoing 
debate. There is, however, general consensus on the importance of 
oversight, as evidenced by the bill, H.R. 1343, unanimously passed out 
of subcommittee and the full Energy and Commerce Committee by voice 
vote. I, for one, want to make sure these programs do not produce some 
sort of Solyndra problem. I want to thank our ranking members, Waxman 
and Eshoo, and their staffs for working with us on this bill. We 
incorporated a number of their suggestions, and the bill is better 
because of it.
  Because the NTIA and RUS have already awarded all $7 billion, the 
bill does not automatically revoke any money. To do so would not only 
be unfair to the grant and loan recipients that are abiding by their 
award terms, it would also likely cost the government more in legal 
fees than it would save.
  The vast majority of the money is yet to be spent by the awardees, 
however. So, what H.R. 1343 does is clarify the responsibility of the 
NTIA and the RUS going forward to terminate failed or failing grants 
and loans and to return to the U.S. Treasury any rescinded or 
relinquished funds. The bill also improves oversight of the broadband 
programs. Among other things, the bill requires the NTIA and the RUS 
either to terminate an award within 30 days of receiving information 
from their respective Inspectors General or the Comptroller General 
regarding material in noncompliance with award terms, or to explain to 
Congress why they don't. It would require the NTIA and RUS to 
deobligate and return to the Treasury funds from terminated awards as 
well as return unused funds from any relinquished awards. Finally, it 
would require award recipients to provide an accounting of funds 
received but not yet expended, if the NTIA or RUS terminate those 
awards.
  The number of NTIA and RUS awards that have already been returned, 
and the fact that more than 90 percent of the money the ARRA allocated 
for broadband still remains obligated but unspent, makes this 
legislation all the more important. Of 233 NTIA awards worth 
approximately $3.94 billion, recipients had only spent $480 million 
through June of this year, despite claims that the stimulus act 
generally would focus on ``shovel ready'' projects. Clearly, that 
hasn't happened here. Four of the 233 awards worth approximately $40 
million have already been rescinded or returned. The RUS has issued 320 
awards, consisting of $2.3 billion in grants and $87 million leveraged 
for $1.2 billion in loans. Yet recipients had only spent $250 million 
by the middle of July, and 28 of the 320 awards, worth $123 million in 
grants and $35 million in loans, had already been returned or 
rescinded.
  Some of my colleagues, as they did in committee, may say that the 
legislation is really unnecessary. I would disagree. The Department of 
Commerce Inspector General, the Department of Agriculture Inspector 
General, and the Government Accountability Office have all flagged 
concerns with the programs and identified them as high risk, including 
in testimony at the Communications and Technology Subcommittee's 
February 10, 2011, hearing.
  A number of statutory shortcomings further demonstrate the need for 
this legislation. For example, existing law leaves the NTIA and the RUS 
too much discretion in deciding whether to deobligate and return funds 
from failed or failing awards. Section 6001(i)(4) of the stimulus law 
establishing the NTIA program stipulates only that the Assistant 
Secretary ``may'' deobligate awards in cases of waste, fraud, or 
insufficient performance. The statutory language provides even less 
guidance to the RUS, remaining silent on the issue of deobligation and 
return of funds. Commerce Assistant Secretary Strickling agreed in an 
April 2011 hearing that the bill would create more certainty. That was 
our effort.
  While Dodd-Frank added rescission provisions to the ARRA, it is 
unclear whether the terms ``withdraw'' and ``recapture'' in Dodd-Frank 
have the same meaning as ``deobligate'' in section 6001 of the ARRA, 
leaving unclear how the Dodd-Frank provisions would be interpreted and 
applied to the broadband grants.
  When Congress uses billions of dollars to subsidize broadband in 
competition with the private sector, especially when 95 percent of the 
country already has access, it bears all the more responsibility to 
police those dollars. For this and all the reasons that I have 
mentioned, I thank the gentleman from New Hampshire for his leadership 
on this issue, and I urge my colleagues to vote for the bill.
  I reserve the balance of my time.

                                         House of Representatives,


                                     Committee on Agriculture,

                               Washington, DC, September 30, 2011.
     Hon. Fred Upton,
     Chairman, Committee on Energy and Commerce,
     Washington, DC.
       Dear Chairman Upton: Thank you for the opportunity to 
     review the text of H.R. 1343, to return unused or reclaimed 
     funds made available for broadband awards in the American 
     Recovery and Reinvestment Act of 2009 to the Treasury of the 
     United States, for provisions of the bill that fall within 
     the jurisdiction of this Committee.
       Knowing of your interest in expediting this legislation and 
     in maintaining the continued consultation between our 
     Committees on these matters, I agree to discharge H.R. 1343 
     from further consideration by the Committee on Agriculture. I 
     do so with the understanding that by discharging the bill, 
     the Committee on Agriculture does not waive any future 
     jurisdictional claim over this or similar matters. In 
     addition, in the event a conference with the Senate is 
     requested on this matter, the Committee on Agriculture 
     reserves the right to seek appointment of conferees, if it 
     should become necessary.
       I ask that you insert a copy of our exchange of letters 
     into the Congressional Record during consideration of this 
     measure on the House floor.
       Thank you for your courtesy in this matter and I look 
     forward to continued cooperation between our respective 
     committees.
           Sincerely,
                                                   Frank D. Lucas,
     Chairman.
                                  ____

                                         House of Representatives,


                             Committee on Energy and Commerce,

                               Washington, DC, September 30, 2011.
     Hon. Frank D. Lucas,
     Chairman, Committee on Agriculture, Washington, DC.
       Dear Chairman Lucas: Thank you for your letter regarding 
     H.R. 1343, to return unused or reclaimed funds made available 
     for broadband awards in the American Recovery and 
     Reinvestment Act of 2009 to the Treasury of the United 
     States. As you noted, there are provisions of the bill that 
     fall within the rule X jurisdiction of the Committee on 
     Agriculture.
       I appreciate your willingness to forgo action on H.R. 1343. 
     I agree that your decision should not prejudice the Committee 
     on Agriculture with respect to the appointment of conferees 
     or its jurisdictional prerogatives on this or similar 
     legislation.
       I will include a copy of your letter and this response in 
     the Congressional Record during consideration of H.R. 1343 on 
     the House floor.
           Sincerely,
                                                       Fred Upton,
                                                         Chairman.

                              {time}  1240

  Mrs. CAPPS. I yield myself such time as I may consume.
  Mr. Speaker, I rise today also in support of H.R. 1343. This 
legislation directs the Department of Commerce's National 
Telecommunications and Information Administration and the Agriculture 
Department's Rural Utility Service to do what they are already, to a 
great degree, doing--returning deobligated broadband Recovery Act funds 
to the U.S. Treasury.
  As Mr. Walden just said, H.R. 1343 was reported by the Energy and 
Commerce Committee with broad bipartisan support, and we should always 
take every step possible to improve oversight and ensure that U.S. tax 
dollars are spent wisely. So that is a good reason to support this 
bill, but I think it's also important today not to lose sight of the 
fact that the Recovery Act has been a true success for broadband 
deployment.
  The $7 billion in allocated broadband spending is bringing real 
economic, educational, and civic benefits to communities throughout the 
country. It's bridging the middle-mile gap, bringing high-speed 
Internet to small businesses and rural entrepreneurs. For businesses to 
grow, they need to expand their markets and enhance their realtime 
capabilities.
  Broadband enables these successes. Broadband also connects patients 
with health care specialists thousands of miles away, and it enables 
doctors to monitor the vital signs of a heart patient while the patient 
sits at home.

[[Page H6572]]

Importantly, broadband brings the world's reference materials to the 
fingertips of our students in classrooms in big urban cities and in 
rural communities alike.
  Simply put, broadband is no longer a luxury; it is a real necessity. 
That's why so many of my colleagues advocated for broadband applicants 
in our congressional districts. From coast to coast, Mr. Speaker, our 
colleagues joined us in understanding the necessity of broadband 
deployment, and there were tremendous success stories.
  In my home State of California, for example, the Digital 395 
Broadband Project is deploying broadband in rural communities up and 
down the eastern edge of the State. We're seeing community colleges 
expand their learning centers to provide outreach, training, and 
learning support services to increase the digital literacy skills of 
low-income residents. They are learning the critical skills needed to 
be full participants in our digital economy.
  Across the country, the large-scale public-private Internet2 project 
is working to connect 121,000 community anchor institutions to a 
dedicated national fiber backbone. Colleges, universities, libraries, 
major veterans and other health care facilities, as well as public 
safety entities, are all benefiting from this Recovery Act broadband 
project.
  As I said earlier, we must make sure that taxpayer dollars are always 
spent wisely; and that's why, to counter waste, fraud and abuse, the 
Recovery Act built oversight directly into the structure of the law. 
The two agencies overseeing the broadband programs, the Department of 
Commerce and the Department of Agriculture, were provided $16 million 
and $22.5 million respectively to oversee audit programs, grants, and 
activities funded by the Recovery Act.
  To further enhance oversight, the Pay It Back Act was passed as part 
of the Dodd-Frank Wall Street reform. It makes clear, in no uncertain 
terms, that all returned or deobligated funds must be promptly 
transferred back to the Treasury. In fact, the Energy and Commerce 
Committee heard testimony from Assistant Secretary Strickling and 
Administrator Adelstein that they were already promptly returning 
deobligated funds to the Treasury, and they saw no ambiguity in current 
law that would prevent them from continuing to return deobligated 
funds. Current law is clear: deobligated funds must be returned to the 
Treasury.
  So while I do support the bill before us, I must be honest and say 
that I think it is a little redundant. Oversight was built into the 
Recovery Act, into the broadband programs, and was reaffirmed with 
Dodd-Frank. This bill simply reiterates what the NTIA and the RUS are 
already doing--vigorously overseeing broadband projects and returning 
all deobligated funds to the Treasury.
  While this bill is not necessarily needed, I do not oppose it, and I 
encourage my colleagues to join me in supporting this bill.
  I reserve the balance of my time.
  Mr. WALDEN. Mr. Speaker, I now yield such time as he may consume to 
the author of the legislation, a very valuable member of our 
Subcommittee on Communications and Technology, the gentleman from New 
Hampshire (Mr. Bass).
  Mr. BASS of New Hampshire. I want to thank my friend and colleague 
from Oregon for yielding me time. I also want to thank my friend from 
California for supporting this legislation and for speaking in support 
of it.
  Mr. Speaker, as the representative of a rural district, I understand 
the challenges of increasing access to broadband Internet service. We 
have many, many communities that suffer economically, as well as 
culturally, due to the lack of access to broadband; and any effort 
that's undertaken to improve that access is a good effort. At the same 
time, however, Congress must act to protect the taxpayer and provide 
oversight for the nearly $7.2 billion in funds appropriated by the 2009 
American Recovery and Reinvestment Act.
  I would only note that a significant percentage of the obligated 
funds are being expended by recipients who have little or no experience 
in the business of designing and building broadband Internet and that 
that, in and of itself, justifies the passage of this legislation, 
which would provide much needed oversight for the broadband stimulus 
funds and would ensure that the law is definitive and would be quick to 
reclaim funds if there is reason to terminate an award for reasons of 
waste, fraud, or insufficient performance. As my friend from Oregon and 
my friend from California mentioned, it does not revoke any award that 
has already been granted.
  The GAO and Inspectors General have testified that the size and 
complexity of the programs and the short turnaround time provided to 
the NTIA and RUS to award the money has created substantial risk in 
these programs. Thus far, nearly 30 awards for grants and loans worth 
about $200 million have been returned to the Treasury. Many have 
returned the awards because they've recognized that they won't be 
successful. In those cases, we want to ensure that taxpayer exposure is 
minimized, and we want to prevent throwing good money after bad for 
projects that should be terminated for waste, fraud, or insufficient 
performance.
  During committee hearings, the administrators testified that the 
decision to deobligate funds for awards that give rise to reason to 
terminate is discretionary, according to the Recovery Act language. I 
emphasize ``discretionary.'' The Inspectors General said the stimulus 
bill does not make clear whether or when the NTIA and the RUS must 
deobligate funds for troubled projects. This legislation removes that 
ambiguity and makes clear that such problem awards must be terminated 
and deobligated.
  Moreover, the Inspectors General said current law does not ensure the 
NTIA and RUS will be responsive to their oversight recommendations. 
H.R. 1343 will provide important sunlight by requiring the 
administrators to act on recommendations made by the IG or to respond 
with their reasons for not acting.
  While I wasn't in Congress for the Recovery Act's passage, now that 
the funds have been awarded, I think it's common sense that Congress 
should require an accounting of how these funds are being spent and 
what the American taxpayer is getting for these expenditures.
  Mr. Speaker, I urge the Congress to pass this important piece of 
legislation.
  Mrs. CAPPS. I reserve the balance of my time.
  Mr. WALDEN. Mr. Speaker, I now yield such time as he may consume to 
the gentleman from Florida (Mr. Stearns), who chairs our very important 
Oversight Subcommittee and who has done extraordinary work in looking 
into some of these programs, not necessarily on the broadband side 
here, but certainly on the energy loan side, where there has been a 
problem.
  Mr. STEARNS. First of all, let me say to my colleague from New 
Hampshire that you weren't here when it was passed. I am sure glad as 
heck that you're here today to provide this legislation and give 
respectful oversight to the taxpayers and help them out with trying to 
save money and being accountable. So it is a credit to you and your 
initiative to get this bill on the floor.
  I also want to thank the chairman of the Telecommunications 
Subcommittee for his initiative in getting this on the floor. It's 
something that, I think, we've wanted to do for a while; and between 
the leadership of Mr. Bass and the leadership of Mr. Walden, we've got 
this today.

                          ____________________