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Dingell, Markey Seek Info on DTV Expense Request

The heads of the House Commerce Committee and Telecommunications Subcommittee will likely grill National Telecommunications and Information Administration acting head Meredith Attwell Baker Tuesday on the NTIA's request to free up more funding for administering the digital-TV-to-analog converter-box-coupon program.

The NTIA wants the ability to move some money from the coupons to expenses, and it needs congressional approval to do so. But in a letter to Baker, House Commerce Committee chairman John Dingell (D-Mich.) and Ed Markey (D-Mass.) wanted some answers as to why the NTIA did not raise the issue earlier.

They also pointed out that they raised the question about administrative funds in July and the NTIA did not signal that it might need the money.

Their letter came in advance of Tuesday's Commerce Committee hearing on the status of the DTV transition.

The full letter is reprinted below:

Dear Assistant Secretary Baker:

The committee received the Sept. 11, 2008, letter from Lily Fu Claffee, general counsel of the U.S. Department of Commerce, submitting a legislative proposal to address a shortfall in administrative funds for the TV-converter-box-coupon program.

We are aware that the National Telecommunications and Information Administration anticipates that it may soon run out of administrative funds to distribute certain coupons to consumers as part of the TV-converter-box-coupon program in the coming weeks and months. Specifically, we understand that absent additional administrative funds, the NTIA likely will not be able to fully meet demand for the redistribution of unredeemed and expired coupons to other households.

As the committee considers the department’s request that Congress enact legislation to provide the NTIA with additional administrative funds for the program, we respectfully request your answers to the following questions to better understand how to address this matter.

On July 10, 2008, we sent the NTIA a letter to better understand why there was a shortfall in administrative funds for the program and how best to address it. In its July 25, 2008, response, the NTIA explained that its contract with IBM for the program was a requirements contract that “did not limit the government’s ability to obtain additional coupons with funding resulting from coupons that were not redeemed and had expired.” In this letter, the NTIA failed to state that it anticipated needing Congressional assistance to obtain additional administrative funds to make coupons that were not redeemed and had expired available to other households.  Why did NTIA fail to indicate in its July 25, 2008, response that it might require additional administrative funds to fulfill Congress’ mandate that coupons that are not redeemed and have expired be made available to other households?

In a Washington Post article dated July 11, 2008, you were quoted as stating, “The program has been very successful ... We anticipated coupons would be recycled and prepared for it.” Please explain why, if the NTIA prepared for the recycling of coupons, it is now seeking additional administrative funds from Congress.

The NTIA’s second quarterly letter to the Committee on Energy and Commerce regarding whether additional funds will be needed for the program, dated July 18, 2008, stated that the NTIA was “exploring options, and is exercising its rights under its contract with IBM, to accommodate the incremental administrative expenses associated with the issuance of these additional coupons to new applicants ... the NTIA is committed to ensuring that the coupon program can meet the high consumer demand for coupons.” Why did the NTIA’s letter fail to explain to the committee that the NTIA’s commitment to ensuring that the program can meet high consumer demand might include a request for Congressional action to address a shortfall of administrative funds?

Absent Congressional action, on what approximate date does the NTIA anticipate that it will run out of administrative funds for the program?

In light of the fact that households have requested more than 26.6 million coupons in the first eight-and-a-half months of the program and that six-and-a-half months remain during which households may request coupons, how many coupons does the NTIA predict will be requested over the life of the program?

Section 1(a) of the NTIA’s legislative proposal would grant the NTIA the authority to avail itself of up to $7 million from Sections 3005, 3006, 3008, 3009 and 3010 of the Deficit Reduction Act of 2005 for administrative expenses of the program. How many additional coupons does the NTIA estimate that $7 million would fund?

While Section 1(a) of the NTIA’s legislative proposal is capped at $7 million, Section 1(b) of the proposal would allow the NTIA to use additional amounts from Sections 3005, 3006, 3008, 3009 and 3010 of the DRA to compensate for a shortfall in administrative funds. Assuming that the NTIA was not permitted to use sums from Section 3005 of the DRA, please specify the amount of money the NTIA believes it could reprogram from each of Sections 3006, 3008, 3009 and 3010 of the DRA for administrative expenses of the program.

Thank you in advance for your attention to this important and time-sensitive matter. We respectfully request a response by Friday, Sept. 19, 2008.