Broadband consortium accused of making “false reports”, CPUC wants $244,000 back

by Steve Blum • , , ,

The California Public Utilities Commission began funding regional broadband development groups, AKA broadband consortia, in 2011. In rural areas, and some urban areas, the groups primarily worked on expanding broadband infrastructure. But in Los Angeles County, the focus was on broadband promotion – AKA broadband “adoption” – programs that aimed at getting more people to use – and subscribe to – Internet service.

One of those groups styled itself “California’s One Million New Internet User Coalition”. It received conditional approval for a $450,000 grant from the CPUC and paid for by the California Advanced Services Fund (CASF), to run digital literacy training, primarily in low income communities in LA County. An organisation called Korean Churches for Community Development was in charge of the money – AKA, the fiscal agent – and, according to CPUC records, the consortium’s leader was Larry Ortega, CEO of Community Union Inc.

The CPUC doesn’t simply write checks, however. The CASF program generally reimburses grant recipients, including consortia, for money that is spent on approved activities, and properly documented. The NIU Coalition, as it’s sometimes called, made claims about millions of people reached that might have true – one news story on an LA television station gets a lot of eyeballs. But the training programs that the CPUC was paying for were a different matter. According to a report by CPUC enforcement staff, what the consortium actually did, didn’t match the reimbursement claims that it submitted…

The Coalition repeatedly made false claims to the Commission by reporting
that they provided 40 hours of instruction despite reducing instructions to 20
hours…the Coalition “gave the impression that the Consortium has been offering the 40-hour in-class training in all its quarterly reports and in its requests for Year 2 and Year 3 budgets.” The Coalition’s application and subsequent annual work plan submissions to the Commission all falsely claimed that they were still providing 40-hour training programs. The Coalition misled the Commission by making false reports.

The CPUC will vote next month whether to begin the formal process of clawing back $244,000 from KCCD, and possibly assessing fines and other penalties on it and Ortega. According to the CPUC, Ortega and KCCD have stonewalled them, and largely refused to respond to questions or demands to return the money.

I do a lot of work for regional consortia, some of it paid, some of it not. I’m proud of what I do, but not of some of the other crap that goes on. I’m not a disinterested commentator. Take it for what it’s worth.