- The Washington Times - Tuesday, August 28, 2012

The Federal Communications Commission paid out more than $1 million in federal stimulus funds to a London company through a contract that reported creating no jobs in the U.S. or overseas, procurement records show.

The vendor, SamKnows Ltd., won the stimulus-funded contract to help the FCC collect data on broadband speeds of various Internet service providers (ISPs).

The company said in a statement when it started work with the FCC that a separate company, SamKnows Inc., would “appoint US partners and create new jobs for American workers, both in the short term and in the long term.”

Although FCC officials said the project was worthwhile and helped spur investment in broadband, contract activity reports filed through the Recovery Act website show that it didn’t create any jobs.

Under a section asking how many jobs had been created, officials noted “zero” after the project was completed.

Though the contract was awarded in the spring of 2010, the flow of funds overseas from the stimulus program is getting a fresh look on the campaign trail.

Republicans are criticizing President Obama’s stimulus program for projects linked to foreign companies, while Democrats attack Mitt Romney’s years at Bain Capital, saying the firm was investing in companies that sent jobs overseas.

The issue surfaced last month during a White House press briefing. Asked whether stimulus money went overseas, press secretary Jay Carney said estimates were that the stimulus created or saved more than 3 million jobs.

“I think in some cases it went to companies that have, like a lot of companies, that have operations both overseas and in the United States,” Mr. Carney said. “The money from the Recovery Act that went to these companies went to operations in the United States that created jobs for American workers here at home. And that was the purpose.”

Despite the lack of jobs on the so-called “measuring broadband in America” contract, FCC officials say the SamKnows deal, which was awarded through competitive bidding, was important and worth the money.

The program “helped drive investment in broadband infrastructure,” FCC spokesman Mark Wigfield said. He said that under the program, Internet service providers initially reported to be lagging in performance responded by expanding their networks.

In 2010, FCC officials said, the SamKnows contract would allow the commission to help let consumers know whether they are getting the broadband speeds that providers advertise.

An analytics company, SamKnows, which reviewed broadband performance in England, used hardware and software in the homes of thousands of volunteers to measure broadband performance, with two rounds of testing in 2011 and 2012, according to the FCC.

The second round of testing found that “accurate delivery of advertised performance by ISPs has improved overall,” with consumers seeing broadband services more closely aligned with what is advertised compared with a year earlier, an FCC report found.

Pete Sepp, vice president at the National Taxpayers Union, said that although the money likely helped the FCC conduct its own assessments of broadband service, job creation is another matter.

“It’s possible that the data collection is a worthwhile endeavor, though making an immediate connection to stimulating the economy by spending the money in this manner seems difficult here,” Mr. Sepp said.

He said online government spending reports showing no jobs created raise additional questions.

“It just goes to show that even with gains made in database and reporting capacity, there’s still a great deal more that taxpayers need to know about government grants and contracts,” Mr. Sepp said.

“And when they see zero under the entry of jobs created, they have every right to ask hard questions about spending that was touted as a way to bring or preserve employment opportunities for millions.”

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