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Adak Telephone could file for bankruptcy by the end of the year? #USF #RuralBroadband

Adak’s Phone Company Calls on Feds to Restore Subsidies

By Stephanie Joyce, KUCB - Unalaska | July 30, 2013 - 5:27 pm
Logo of the United States Federal Communicatio...
Logo of the United States Federal Communications Commission, used on their website prior to 2002 or 2003, and still used on some publications and areas of their website. The central part of the logo is also used on products which conform to FCC requirements. (Photo credit: Wikipedia)

The fed eral government is cutting subsidies to the telephone company that serves Adak amid concerns about how the money is being spent.

That leaves the future of Adak’s phone service up in the air.

Fifteen thousand dollars. That’s about how much the Federal Communications Commission used to pay Adak Telephone annually for each phone line in the community. In 2011, the total added up to $4.2 million worth of federal subsidies for less than 400 people.

But those days are over..............

................. “We would have to ask RUS, because we were allowed to purchase those items through the Rural Utilities Service program loan,” Weaver said.

That’s a federal loan from the US Department of Agriculture. Weaver says they borrowed $6 million in 2005, and still owe most of that – $4.7 million. If the FCC doesn't restore their subsidies, Weaver says Adak Telephone will file for bankruptcy by the end of the year, and default on their debt.....

......... “GCI is basically saying that once we file for bankruptcy, they will purchase our assets for pennies on the dollar to provide service,” according to Weaver.....