LANSING – The chief operating officer for the Michigan Broadband Development Authority said Wednesday that while the agency had made cutbacks to its staff in the recent months, the authority would like to follow through with awarding its remaining $17 million in grants, primarily to smaller rural projects.
During the House Energy and Technology Committee hearing, COO Bob Filka said while the agency made mistakes when it was first created because it targeted large-scale broadband projects, it has since reorganized and is focused on small entrepreneurs and providing the last of its grant money to rural areas of the state.
Angered over what they said was a waste of money in administrative costs and an unfocused approach to providing grant funding – including help with projects in metropolitan Macomb and part of Oakland counties instead of rural areas – Republicans are now trying to decide what to do with the program. The program also drew ire because the Michigan State Housing Development Authority has forgiven $10 million of MBDA loans – money that could have gone to low-income housing.
Legislation (HB 4563) has been introduced that would delete the authority, but the bill’s sponsor Rep. John Garfield (R-Rochester Hills) said he wants to make sure rural programs get funding, but added that the authority should do it “expeditiously.”
Filka said the authority is receiving applications until Feb. 28 and hopes to get the bulk of the money out by early summer, with further staff deletions and final closing out by the end of the calendar year.
“All of our loans are performing,” he said of the program.
He said the agency has learned from its mistakes and that the lessons will work well as the state ventures into the 21st Century Jobs Fund. Rep. Andy Dillon (D-Redford) suggested the authority’s responsibilities could be placed under that fund so grants given out throughout the years could be monitored.
Committee chair Rep. Mike Nofs (R-Battle Creek) said members will have to review their options, which include addressing the authority through the budget process or moving all responsibility of finishing out the loans through MSHDA. Rep. Leon Drolet (R-Clinton Twp.) also said the Legislature could just take away the $17 million dollars.
MSHDA acting Executive Director Rick Laber said the agency can take over monitoring of the loan system but would prefer to stay out of it until the last $17 million has been dispersed and the authority is absolved. He also commented on the $10 million loan forgiveness, which he called a win-win situation since the agency would receive money back faster than it would have under the original agreement.
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