Gardner Grills Group on Use of Stimulus Funds

February 21, 2013

Gardner is pressing EAGLE-net for answers

DENVER –EAGLE-Net Alliance, a little-known Broomfield-based intergovernmental agency that has been plagued by questions about questionable expenses and waste, and whose govermment grant was suspended, is facing renewed scrutiny.

In 2010 EAGLE-Net was propped up by a $101.6 million federal stimulus grant as part of the American Recovery and Reinvestment Act’s Broadband Technology Opportunities Program (BTOP) with the aim of building and expanding a high-speed, fiber-optic broadband network to rural parts of the state.

Much of the grant money – about $60 million – has already been awarded, but EAGLE-Net is hoping to recover the remaining $40-plus million after modifying its network routes in some areas, according to a letter dated Dec. 6, 2012.

While the goal of improving broadband access on the Eastern plains and Western slope sounds non-controversial, industry professionals and smaller telecom companies are crying foul.  They maintain that taxpayer dollars received by EAGLE-Net are being used to subsidize services to anchor institutions, such as schools, libraries and other public-sector entities at rates that smaller private-sector companies can’t compete with.

U.S. Rep. Cory Gardner (R-Yuma) met recently with officials from The National Telecommunications and Information Administration (NTIA), the federal agency that created the grant program and representatives of EAGLE-Net, to get some clarity on the goals and objectives and scope of the grant.

Representatives of the Colorado Telecommunications Association, which represents 25 local rural broadband providers across the state, were also present to address concerns that EAGLE-Net is overstepping its bounds by essentially becoming a government-funded competitor to the private sector.

“NTIA’s response was not only inadequate in answering any of our questions, but it almost defended the gross overreach of EAGLE-Net’s original scope,” Gardner said in a statement.

EAGLE-Net recently installed Mike Ryan as their new interim president, a move that backers hope will quell criticism of the embattled agency.

“The fact that [Ryan has] clearly got a telecommunications background is helpful in itself in terms of building out this network,” said Pete Kirchhof, Executive Vice President of the Colorado Telecommunications Association.  “We hope to have a meeting with Mr. Ryan in the next several weeks to pursue specific ideas on how we can work together.”

But some have pointed out that Ryan previously served as vice president of deployment and capital management at Open Range Communications Inc., a Greenwood Village-based rural broadband company that was the subject of a Congressional probe launched into a $267 million government loan.

Open Range ultimately filed for Chapter 11 bankruptcy.

Gardner also noted that Governor Hickenlooper’s appointee John Conley serves as the Chair of the EAGLE-Net Alliance board. Conley is also Executive Director and Chief Technology Officer of Colorado’s Statewide Internet Portal Authority (SIPA) another intergovernmental entity that has faced recent criticism.

SIPA was the subject of a scathing audit which uncovered some $69,400 in expenses in less than two years, all approved by Conley, on his corporate credit card.  The audit findings prompted bipartisan criticism.

State Sen. Lois Tochtrop (D-Thornton) called it “[P]robably the worst audit that I have seen…without any checks and balances in place…this is a lot of money that is just not accounted for.”

Gardner echoed Tochtrop’s frustration.

“Where is the Governor on this? Why hasn’t he said anything about this,” Gardner added.  “[I]s [Hickenlooper] even worried about the implications? No one knows.”

Comments made by visitors are not representative of The Colorado Observer staff.

One Response to Gardner Grills Group on Use of Stimulus Funds

  1. wrongheifer
    February 21, 2013 at 6:34 pm

    Far to much taxpayer funding falls into these ‘ratholes’…never to be seen or accounted for! Time for some accountability people!


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