USDA Seeks Comment on $600 Million Program; Providing Loans and Grants to Broadband Providers Serving Eligible Rural Areas

The U.S. Department of Agriculture (“USDA”), through its agency Rural Utilities Service (“RUS”), is seeking comments on the implementation of its e-Connectivity Pilot (“ECP”), a $600 million program designed to bring broadband to unserved rural areas in the United States. The idea behind ECP is to leverage federal funds to increase private investment in broadband services for rural American homes, businesses, farms, schools and health care facilities. The deadline for comment submission is September 10, 2018.

ECP is authorized by Section 225 of the Consolidated Appropriations Act of 2018. Congress allocated these funds for broadband deployment in rural areas with populations of 20,000 or less. Many types of entities are eligible for funding, including incumbent and competitive rural telephone and broadband service providers, rural electric cooperatives, private firms (but not sole proprietors or partnerships), nonprofits and governmental bodies.

Funding will be limited to service provision in Eligible Rural Areas (“ERAs”). ERAs are rural areas in which at least 90 percent of the households to be served by a project receiving a loan or grant do not have sufficient access to broadband, defined as 10 Mbps downstream, and 1 Mbps upstream.  

Applications for ERAs cannot propose over-building or duplicating broadband implementation by any entity to which RUS has provided a broadband loan. Also, ERA applications must be evaluated by service area assessments required by the Rural Electrification Act, so that existing broadband suppliers can provide input on existing service in the proposed service areas. If no such input is received, RUS must use the most current data of the National Broadband Map or any other data that can be “reasonably obtained.”

RUS seeks comments on various questions concerning the implementation of ECP, including:

  • What types of technologies and services are considered ‘‘sufficient access’’ in ERAs?  In particular, RUS requests input about the transmission capacity required for economic development, to ensure that rural premises have access to coverage similar to that offered in urban areas. Should affordability of service should be included in evaluating whether an area already has sufficient access? How should benchmarking of affordability of internet services be accomplished? What other elements should RUS consider when defining sufficient access?
  • What are the best options to verify speeds of broadband service provided to rural households? RUS will use a combination of Public Notice filing & response and the National Broadband Map to post proposed service territories of applicants to allow service providers an opportunity to comment on whether or not 10 Mbps downstream and 1 Mbps upstream service exists for households in the proposed service areas. Comments are sought on how data speeds are to be used or verified, given the limited availability of publicly-available information regarding accurate broadband speeds provided to rural households. What other sources of data should be used for evaluation?
  • What are the best leading indicators of the potential project benefits for rural industries such as agriculture, manufacturing, e-commerce, transportation, health care and education, using readily available public data? RUS is working to ensure that projects funded by the ECP provide improvements to rural prosperity. Comments are specifically requested on effective methods that can measure leading indicators of potential project benefits for these sectors, using available public data. Also, how should the viability of applications that include local utility partnership arrangements be evaluated?

This is a critically important proceeding for any stakeholder that plans to participate in rural broadband deployment. The comments received in this proceeding will be instrumental in shaping the rules for ECP, which will determine which areas are served under the program, as well as which providers will receive financial assistance to cover the costs of construction, improvement, and acquisition of facilities for broadband service in rural areas.

For further information on this proceeding, or if you are interested in submitting comments, please contact Ronald E. Quirk at req@commlawgroup.com or (703) 714-1305, or Rob Jackson at rhj@commlawgroup.com or (703) 714-1316.

 

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