Gov. Butch Otter defended one Idaho Education Network settlement Monday, and said another settlement could be in the works.

During his annual post-legislative news conference, Otter said the state is working on a settlement with a federal contractor — which fronted money for the failed statewide broadband system.

Otter declined to say whether a settlement is close at hand.

The Universal Service Administrative Company forwarded about $13.5 million to Idaho. These “e-Rate” dollars, collected from telephone surcharges, were supposed to cover the bulk of the costs for the broadband network.

But USAC cut off e-Rate payments, as a dispute over the Idaho Education Network contract continued to play out in the state courts. And in 2014, former Administration Department Director Teresa Luna told lawmakers the state could be forced to return the $13.5 million to USAC, if the network contract was deemed void.

Since then, a district judge and the state Supreme Court have both deemed the network contract invalid.

On March 9, the state agreed to pay $3.5 million to two Idaho Education Network vendors, Education Networks of America and CenturyLink. The settlement effectively resolved claims between the state and the vendors. But USAC was not a party to this settlement.

USAC spokeswoman Dana Jensen has declined comment on the March 9 settlement, and how it might affect the $13.5 million the feds paid Idaho.

More reading: Otter gives 2017 Legislature high grades on K-12 issues, declines to discuss grocery tax.