That's the plan. It's called Broadband Stimulus Package, and Fairpoint has (or at least had) very good chances of getting a piece of it.

I don't know where did he pulled that info from. There are no federal regulations about over-subscription ratios, and carriers are not required to report data on the performance of their networks to anyone. You're correct - oversubscription ratios on class 5 switch (line to trunk) are up to 5:1 for business, and up to 9:1 for residential lines. That ratio can be dynamically adjusted depending on the load at the moment. There are FCC regulations regarding emergency (911) calls, and that service has a number of high availability requirements.