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Just One More Complicating Rule for Broadband Stimulus Funds

By Gary Kim, Contributing Editor

It's just one of a host of details applicants will have to consider, but the American Recovery and Reinvestment Act requires that all contracts comply with the Davis-Bacon Act, which stipulates that all wages comply with prevailing wage law for public projects. 

As a practical matter, that means matching funds will have to account for the higher wage rates ARRA projects will require. In other words, a higher match than many might have been planning for.

 

Funds for broadband programs in the past at USDA have not required contracts to comply with the prevailing wage law for public projects known as the Davis-Bacon Act.

 

Might some potential applicants just decide it is better not to apply for ARRA funds at all, or to apply for on-going Rural Utilities Service funding instead?

 

And though industry equipment and software suppliers seem publicly confident about the “Buy American” provisions, there already have been horror stories about building contractors working under the ARRA who literally have had to rip out wiring in order to comply with the rule, as the wire was manufactured outside the United States.

 

Granted, there are waiver provisions. It is hard to imagine how much of anything used in modern communications could be deployed in a network were a “Buy American” rule to be enforced stringently.

Gary Kim (News - Alert) is a contributing editor for TMCnet. To read more of Gary’s articles, please visit his columnist page.

Edited by Jessica Kostek