- The Washington Times - Saturday, September 20, 2008

The costs to run a coupon program that is helping people shift to digital television are about to exceed a congressionally mandated cap and the Bush administration is asking for more money.

Administrative costs for the program are capped at $160 million. The program provides two $40 coupons per household to consumers who will need converter boxes when full-power television stations shift to digital-only broadcasting in February.

The boxes retail for between $40 and $70.

Without legislative action, the Commerce Department’s National Telecommunications and Information Administration (NTIA) says it may run out of funds to administer the program by the end of January, according to a letter delivered to Congress on Thursday.

Federal law allocated $1.5 billion toward the coupon program with a maximum of $160 million to be used toward administrative expenses. So far, the NTIA has committed $157.2 million to IBM, the coupon program’s contractor - nearly $40 million more than the initial contract award.

Last week, the agency quietly asked Congress to pass legislation that will allow it to dip into funds dedicated for emergency communications and other programs “if needed.”

The NTIA wrote Vice President Dick Cheney as president of the Senate to request legislation be passed that would allow it to “use the balances in certain other programs” to cover administrative expenses.

The draft legislation asks for immediate access to $7 million, but the total could be much more. It also seeks an unspecified sum if the NTIA receives approval from the Office of Management and Budget.

The coupon program will be funded by proceeds from a $19 billion auction of radio airwaves, made available thanks to the transition. The additional administrative expenses, under the legislative proposal, would come from programs funded by the auction, which include the coupon plan itself, grants for emergency communications and a tsunami warning system.

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