Citing restrictions on the use of federal subsidies, CenturyLink Inc. on Tuesday said it will accept a little more than one-third of the funds for which it was eligible to expand broadband service to underserved areas of the country.
The telecom provider plans to accept $35 million from the "Connect America Fund" to expand broadband service to 45,000 homes in underserved rural areas in nearly half of the U.S. states.
Linda Johnson, a spokeswoman for Louisiana-based CenturyLink, said 22 states will receive some funding. Colorado, Minnesota, New Mexico, Virginia and Washington will receive the most money from the Connect America Fund, she said.
CenturyLink noted it was eligible for nearly $90 million in funding, but restrictions on the use of those "funds made further deployment uneconomic."
The Federal Communications Commission last year created the Connect America Fund as part of comprehensive reform to Universal Service rules. The FCC has allocated $300 million for phase one of the Connect America Fund, according to CenturyLink in a regulatory filing.
"In addition to the incremental CAF funding, we are investing millions of dollars of our own money to bring robust broadband services to more customers because we believe these services will bring essential educational and economic opportunities to high-cost, rural areas of the country," said Steve Davis, CenturyLink executive vice president for public policy and government relations, in a statement.
CenturyLink may be entitled to additional subsidies. As we reported Monday, the company is requesting a waiver that, if granted, CenturyLink says will enable it to deploy service to another 60,000 homes in high-cost areas. Arizona, Colorado, Washington and Oregon are among the states that will benefit, according to CenturyLink spokesperson Meg Andrews.