Telecommunications Law Alert: Applying for Grants and Loans Under the Broadband NOFA
7/10/2009

The National Telecommunications and Information Administration ("NTIA") and the Rural Utilities Service ("RUS") have now issued the awaited NOFA soliciting applications for grants and loans to increase broadband access in unserved areas, improve access in underserved areas, enhance broadband capacity at public computer centers, and promote sustainable broadband adoption projects.

Issuance of Funds

Funds will be issued in three waves. $4 billion will be issued in the first wave, with all funding to be awarded by Sept. 30, 2010.

Of the $4 billion, RUS will distribute $2.4 billion in grants, loans and loan guarantees under its Broadband Initiatives Program ("BIP"), including up to $1.2 billion for last-mile projects, divided among remote areas ($400 million) and non-remote areas ($800 million), and $800 million for loan or loan-grant combinations for middle-mile projects.

NTIA will distribute the remaining $1.6 billion as grants under its Broadband Technology Opportunities Program ("BTOP"), including $1.2 billion for broadband infrastructure projects, up to $50 million for public computer centers, and up to $150 million for sustainable broadband adoption.

Timing

The NOFA sets up a one-month filing window, from July 14, 2009 to August 14, 2009 for the first $4 billion of funding. Announcement of funding awards is set to begin on November 7, 2009.

After narrowing the applicants down to "finalists," to be announced Sept. 15, states will be asked to weigh in on the selection of actual recipients. Those applicants also will be asked to substantiate statements in their applications by supplying additional documentation within 30 days after request by the applicable agency..

Other application windows at set for Winter/Spring 2010 and Spring/September 30, 2010.

Definitions

"Unserved" area - one or more contiguous census blocks, where at least 90 percent of households lack access to facilities-based, terrestrial broadband service, either fixed or mobile, at the minimum broadband transmission speed.

"Underserved" areas - one or more contiguous census blocks where: (1) no more than 50% of households have access to facilities-based terrestrial broadband at greater than the minimum broadband transmission speed; (2) there is no fixed or mobile broadband provider advertising service with speeds of at least 3 megabits per second downstream; or (3) the rate of broadband subscribership in the area is 40% or less.

"Broadband" - the minimum broadband transmission speed is defined as at least 768 kilobits per second downstream and at least 200 kbps upstream to end users. For middle-mile projects, broadband is defined as providing sufficient capacity to support the provision of broadband service to end users.

"Rural Area" - outside a town of 20,000 or more or an urbanized area contiguous to a town of 5,000 or more.

"Remote Area" - Unserved rural area 50 miles from a non-rural area.

Applications for Remote and Rural Area Projects

Applications for Rural Area projects, that are at least 75% rural, must be filed in the RUS "BIP" Program. They may also be submitted to the NTIA BTOP program, but NTIA will only consider the application if RUS decides not to fund the project.

RUS will issue grants only to last mile projects in "remote, unserved, rural areas." It will award loans and loan/grant combinations to projects in "non-remote and underserved rural areas."

Adherence to FCC's Internet Policy Statement

BTOP and BIP recipients will have to commit to adhering to the FCC's Internet policy statement adopted in August 2005. The Policy requires service providers not to favor any lawful Internet applications and content over others, to display network management policies on their Web pages, to connect to the public Internet directly or indirectly, such that the project is not an entirely private closed network program, and to offer interconnection, where technically feasible without exceeding current or reasonably anticipated capacity limitations, on reasonable rates and terms to be negotiated with requesting parties.

NOFA for Broadband Mapping

Separately, NTIA released a NOFA soliciting applications for funding to support broadband mapping projects. Applications for funding under the State Broadband Data and Development Grant Program share the July 14 to Aug. 14 filing window of the BTOP and BIT programs. There will be one grant available per state to the governor or governor's designee.

For More Information

For more information, please contact:

Tom Snyder at (303) 297-7884 or twsnyder@stoel.com
Greg Monson at (801) 578-6946 or gbmonson@stoel.com
John Ridge at (206) 386-7575 or jhridge@stoel.com