Oddly enough, it is supposed to be a timeout for version 1 upload/download. I haven't talked to Guy about how this might be handled in V2 yet. That said, the timeout never actually got implemented: no one has been very excited about touching modem handling lately for fear of being the one to break something. I'll try to make it respect the timeout value for V1 upload/download in the next release.
Its value is the maximum allowable time for a connection to be established and idle before hanging up. It is in response to an RCR from Knecht who was worried about poll workers forgetting to turn off their AccuVote after they upload.