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Boise • Two internet companies that were not paid by the state after a judge voided their contract to bring broadband to public schools across Idaho are suing for the money they say they are owed — more than $37 million in back payments and damages.
Education Networks of America Inc. and CenturyLink Communications LLC filed the lawsuits in federal court last Friday, about 10 days after Idaho Attorney General Lawrence Wasden sent the companies a letter demanding the return of the millions the state had already paid.
The companies contend the contract was void because of the state's actions and through no fault of their own, and say they are demanding payment for the work they did. The companies also want to be compensated for the money they invested to comply with future terms of the contract, such as extending fiber optic cable to remote areas.
In the CenturyLink lawsuit, company officials contend state leaders — including Idaho Gov. C.L. "Butch" Otter and legislative leaders — acknowledged multiple times that the state must pay for the network services it received.
Wasden's spokeswoman Kris Bivens-Cloyd declined comment Monday on the lawsuits, saying state officials are reviewing them.
If the companies win, Idaho could face an even bigger price tag for the failed statewide broadband plan. Taxpayers have already paid out more than $29 million for the project.
Lawmakers had previously hoped to settle the claims for $8 million.
But those efforts were scuttled when the Idaho Supreme Court agreed that the contract with the companies was void.
The $60 million broadband program was created in 2008 in hopes of bringing a single high-speed internet system to all schools across the state.
Proponents said it would give rural students the access to high-speed internet, classes and resources available then available only at bigger schools in more populated and better connected areas.
But the program soon became immersed in a legal quagmire of claims and counterclaims by contractors and state officials. By 2015, most schools were scrambling to find their own internet providers.
Taxpayers could get hit with another school internet bill if the Federal Communications Commission decides to seek repayment for millions of dollars in federal funds that were used for the project, though Otter's spokesman Jon Hanian said so far no such request has been made.
The broadband contract was declared void after a judge ruled that Idaho officials violated state law when they swapped out one of the contractors in the winning bid for another company a month after the contract was awarded.
Meanwhile, Idaho state law requires state leaders to try to recover any money paid out under an illegal contract.
Because the contract was declared void — even though both companies performed the work they were contracted to do — the Idaho Supreme Court said Idaho Attorney General Lawrence Wasden or other officials were required to recover millions of dollars from the companies.