Private companies complain that a broadband grant to the UW system is unfair for competition.

**Update: Wisconsin state legislators have backed off their controversial plan to cut $37 million in federal broadband money from the University of Wisconsin system amid sharp protest from the state’s schools. For details, see here.**

A federally funded effort to expand broadband service in Wisconsin is in jeopardy because some state officials don’t think the recipient of the grant, the University of Wisconsin (UW) system, should get the money. The grant to a public university makes it harder for private companies to compete in delivering broadband service, they say.

Area lawmakers from both parties are voicing concerns over a provision added to the proposed state budget to strip federal stimulus funding from a project to build telecommunications infrastructure—including high-speed, broadband internet cables—in the Chippewa Valley and elsewhere in Wisconsin.

But the leader of a Wisconsin-based firm that represents dozens of telephone companies applauds the move, saying it will prevent UW-Extension from competing with private telecommunications companies.

UW-Extension planned to use the money to fund its Building Community Capacity through Broadband, or BCCB, project. That project would have let UW-Extension plant cables and build other communications infrastructure in parts of the state to link government offices, libraries, schools, and medical centers.

“We all know that having that infrastructure of broadband capabilities is like having water, is like having roads. If you don’t have it, you’re losing stride with the rest of the world,” said Maria Alvarez Stroud, a UW-Extension employee in charge of the project.

The National Telecommunications and Information Administration, or NTIA—a Commerce Department agency chiefly responsible for advising the president on telecommunications and information policies—last year awarded UW-Extension $32.3 million in federal stimulus money to expand broadband communication technology in parts of Wisconsin that don’t have it.

Most of that funding came in a $29.9 million grant to build communications infrastructure in parts of Wisconsin—including in Chippewa, Dunn, and Eau Claire counties.

A roughly $2.4 million grant would have helped UW-Extension conduct educational campaigns across the state to teach about the benefits of broadband.

But earlier this month the Joint Finance Committee, the Legislature’s budget-writing panel, on a party-line vote—the committee has 12 Republicans and four Democrats—passed an amendment 12-4 that would prohibit the UW System or UW-Extension from “receiving funds from any award” from the NTIA to support the BCCB project.