AP: Otter had advance knowledge of broadband crisis

On Jan. 30, 2014, Administration Department Director Teresa Luna angered and stunned lawmakers with news of a broadband budget shortfall — and presented Gov. Butch Otter’s plan for a bailout.

However, Otter knew of the budget crisis in October 2013, the Associated Press reported.

Otter State of the State 2014
Gov. Butch Otter arrives at House chambers to deliver his Jan. 6, 2014 state of the state address. Otter’s speech made no mention of the looming Idaho Education Network budget crisis.

The Idaho Education Network budget crisis stems from an ongoing dispute over the $60 million contract to provide high-speed Internet in the state’s high schools. The legal battle prompted a federal contractor to cut off “e-Rate” dollars that had covered 75 percent of project costs. That forced the 2014 Legislature to scramble to approve $11.4 million in bailouts, the first of two rounds of emergency broadband funding.

Otter did not discuss the funding crisis in his Jan. 6, 2014 state of the state address, leaving Luna to disclose the situation 24 days later. But Otter was aware of the problem, as evidenced by a Nov. 4, 2013 letter obtained by the AP.

“As you know a recent ‘whistleblower’ complaint was filed with the (Federal Communications Commission) concerning the use of E-Rate funds,” Otter wrote to Education Networks of America, the main contractor on the project. “The result is a disruption in federal funds that satisfy the state’s obligations related to the network during the course of the review.”

Since then, a district judge has thrown out the network contract, forcing school districts to secure broadband locally.