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Fed funding for Eagle-Net suspended

Federal stimulus money for Eagle-Net Alliance’s Colorado-wide broadband expansion project has been suspended while questions about its permitting are sorted out.

The move suspends a $100 million National Telecommunications and Information Administration (NTIA) stimulus grant until Broomfield-based Eagle-Net submits documentation related its fiber optic network construction plans.

Eagle-Net’s work has been closely watched by many Colorado school districts anxious to get improved Internet service ahead of the planned launch of online state tests in a couple of years.

The project, funded through the NTIA grant and another $35 million of private donations, has been under construction for months.

It started drawing criticism over the summer when rural telecoms complained Eagle-Net’s lines were being built in areas they already served.

Those companies asked their congressional representatives to stop Eagle-Net’s construction or force changes to its practices.

The NTIA started reviewing Eagle-Net’s compliance with grant requirements in late August.

The review concluded Eagle-Net had failed to submit sufficient documentation of environmental and historic preservation reviews after modifying its network routes in some areas, according to a suspension letter dated Dec. 6.

In a note to its constituents, Eagle-Net said the funding suspension won’t affect current customers, and it will work “diligently” to get its grant restored.

“Although construction has been temporarily postponed, it was already winding down for the 2012 build schedule. Our non-construction related operations will not be affected,” Eagle-Net’s Dec. 7 note said.

Eagle-Net’s 4,600-mile network is the nation’s fifth-biggest broadband project funded under federal stimulus grants.

Eagle-Net is raising $35 million in private funds in addition to the $100 million it was awarded in 2010 by the NTIA, an agency of the U.S Department of Commerce.

Eagle-Net’s mission is to expand fiber-optic lines for high-speed Internet in areas where school, libraries, local government buildings and other “community anchor institutions” either lacked broadband access or found it too expensive.

Local institutions were expected to be eager about Eagle-Net’s arrival and its promise of more affordable broadband.

Eagle-Net cannot sell its services to private organizations or residential customers, and in most cases it tries to partner with the local telecom to provide service to a community institution that seeks access to Eagle-Net’s network.

But rural telecoms that built their own fiber-optic networks using other federal subsidies complain that Eagle-Net’s construction duplicated existing broadband infrastructure and will undermine their businesses.

Copyright 2012 Denver Business Journal. Published with permission.

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