CONCRETE — A plan to bring high-speed Internet to Concrete through fiber-optic cables is in limbo after the federal agency funding the project pulled its grant.

In a compromise between the Skagit Public Utility District, which was to build the fiber system in Concrete, and the U.S. Department of Agriculture, the federal agency agreed to extend the grant for 90 days only to give the PUD time to apply for funds to recover the money it has already spent on the project.

The PUD had been awarded $440,000 to lay the cable in Concrete and to build a transmitting tower that would have provided wireless Internet to most of the town.

In July, the USDA’s Rural Utilities Service, or RUS, informed the PUD it would not extend an Aug. 26 deadline on the grant. The agency ruled that Concrete was no longer eligible for the grant because Verizon had sufficiently developed its DSL Internet service there.

PUD planning engineer Scott Spahr said the utility district would look elsewhere for funding to continue the project.

“It’s not dead, but it’s going to make it tougher, and we’re going to explore other funding avenues,” Spahr said.

Spahr estimated that the PUD and the Upper Skagit Library District had already spent $220,000 on the project. The library district spent between $20,000 and $30,000, Director Aimee Hirschel said. The library paid for a copy machine, computer upgrades, new software and other expenses, former library Director Margaret Studer said.

Studer spearheaded the project for the library before retiring in April.

“The library district passed up other grants along the way to do this same thing because we had the promise of this full grant of $100,000 to set up a computer center,” she said.

Not only the library but the community as a whole loses because the grant fell through, Studer said.

“It’s an economically depressed area. ... A fiber-optic network and the opportunity to have broadband high-speed Internet would have been an economic boon to the community. That’s what the RUS money was for,” Studer said.

Verizon’s DSL service is slower than the proposed fiber system would have been, and it isn’t meeting the community’s needs, Studer said.

“For RUS to say this would be a duplication of service — they don’t understand the kind of technology that’s there and the kind of technology that’s needed to improve the economic positioning of the community,” Studer said. “I feel badly that PUD couldn’t make that case to them, but apparently they couldn’t.”

The PUD discussed the possibility of extending the grant with RUS a few weeks ago in a meeting organized by U.S. Rep. Rick Larsen.

“We tried to press getting it extended, but from USDA’s perspective, the town of Concrete had broadband. That now meant that they were not eligible for the grant,” Spahr said.

USDA spokesman Phil Eggman confirmed that the grant had been extended only to allow the PUD to recoup money already spent.

“They’re giving them 90 days — plenty of time to submit a request for reimbursement,” Eggman said.

Meanwhile, the PUD is bringing fiber as far as Hamilton to accommodate Janicki Industries’ new manufacturing plant. The fiber line should be in Hamilton by the end of September, Spahr said.

As for finding money to bring the line to Concrete, Spahr said the PUD has some ideas, but the utility district needs to do more planning first.

“We’re approaching it with more business planning than has been done before,” Spahr said. “We’re trying to make sure that we protect our existing customers.

“That being said, we’ve met with the people upriver. We’ve heard dissatisfaction with the broadband service they have available, and we’re going to see what we can get up to them.”

Ralph Schwartz can be reached at 360-416-2138 or .