Update On Broadband Funding: FCC Programs, Federal Funding, State Funding
USDA Awards $23.7 Million ReConnect Program Broadband Grant In North Carolina
November 6, 2019 – The U.S. Department of Agriculture has announced that the fifth ReConnect Pilot Program broadband award, a grant in the amount of $23,726,478, has been provided to Star Telephone Membership Corporation in North Carolina. The grant will be used to build a gigabit-capable passive optical network (GPON) which will be 100% buried fiber-to-the-home network. The funded service areas include 8,749 households, 10 educational facilities, and 3 critical community facilities spread over 739 square miles. For the total project, Star Telephone Membership Corporation will build over 535 miles of buried plant to serve 3,570 locations while passing 4,462 possible service locations consisting of farms, businesses, residential, and critical community institutions. USDA’s $600 million ReConnect Program provides loans and grants to construct broadband infrastructure in rural America. USDA received 146 applications for the first round of funding, requesting $1.4 billion across all three ReConnect Program funding categories: 100 percent loan, 100 percent grant, and loan-grant combinations. USDA has made five awards under the program, totaling $ 44,328,101 in grant and loan funding for broadband infrastructure in five states. USDA is currently reviewing applications and will announce additional awards on a rolling basis.
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Missouri Launches $5 Million Broadband Grant Program
November 6, 2019 – Missouri Governor Mike Parson and the Missouri Departments of Economic Development and Agriculture have announced the launch of a $5 million state broadband grant program to deploy high-speed internet access in unserved and underserved areas across the state. Missouri’s broadband grant program was created in 2018 and funded during the state’s 2019 legislative session. It will match up to 50 percent of the construction costs of projects to expand broadband, which includes costs for facilities, engineering and construction plans, permitting, installation, and service validation. The Department of Economic Development will hold one competitive grant round in 2020, using the following timeline:
November 5, 2020 – Grant Guidelines, Selection Criteria, Application and FAQ posted
November 20, 2020 – Webinar for prospective applicants
December 5, 2020 – Grant cycle begins
January 7, 2021 – Applications due by 4:00 pm CDT
January 10, 2021 – Applicants posted on DED Broadband Grant webpage, Challenge process begins
February 24, 2021 – Challenge process closes
March 5, 2021 – Grant awards announced
Eligible applicants for grant funding include corporations, nonprofit organizations registered in the state, political subdivisions, and rural electric cooperatives. The program defines an “underserved area” as an area without access to wireline or fixed wireless broadband internet service of speeds of at least 25/3 Mbps. It defines an “unserved” area as an area without access to wireline or fixed wireless broadband internet service of speeds of at least 10/1 Mbps. To be eligible for funding, applicants must propose to construct network facilities that provide baseline speeds of at least 25/3 Mbps in their desired service areas. Grants will not be awarded where funding from the FCC’s Connect America Fund has been awarded, where high-cost support from the federal Universal Service Fund has been received by rate of return carriers, or where any other federal funding has been awarded which did not require any matching-fund component.
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USDA Awards $4.2 Million ReConnect Program Broadband Grant In Oklahoma
November 5, 2019 – The U.S. Department of Agriculture has announced that the fourth ReConnect Pilot Program broadband award, a grant in the amount of $4,202,222, has been provided to Oklahoma Western Telephone Company. The grant will be used to deploy a fiber-to-the-premises broadband network capable of simultaneous transmission rates of 100 Mbps or greater. The funded service areas include 321 households, 20 farms, and 3 critical community facilities spread over 171 square miles. The broadband network deployment will include 61 miles of aerial and buried fiber with GPON FTTP electronics. The project is expected to facilitate more access to services and information for local residents, and it will improve the overall quality of life for people in the community. USDA’s $600 million ReConnect Program provides loans and grants to construct broadband infrastructure in rural America. USDA received 146 applications for the first round of funding, requesting $1.4 billion across all three ReConnect Program funding categories: 100 percent loan, 100 percent grant, and loan-grant combinations. USDA received 78 applications requesting grant-only funding, and 53 applications requesting loan-grant combination funding. USDA is currently reviewing applications and will announce additional awards on a rolling basis.
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USDA Awards $3.8 Million ReConnect Program Broadband Loan In Virginia
November 4, 2019 – The U.S. Department of Agriculture has announced that the third ReConnect Pilot Program broadband award, a loan in the amount of $3,793,234, has been provided to Mecklenburg Electric Cooperative in Virginia. The 100% loan will be used to deploy a fiber-to-the-home broadband network capable of simultaneous transmission rates of 100 Mbps or greater. The 158.3 square mile funded service area includes 1,254 households, two volunteer fire departments, and four educational facilities. The project will facilitate more access to services and information for local residents, and it will improve the overall quality of life for people in the community. USDA’s $600 million ReConnect Program provides loans and grants to construct broadband infrastructure in rural America. USDA received 146 applications for the first round of funding, requesting $1.4 billion across all three ReConnect Program funding categories: 100 percent loan, 100 percent grant, and loan-grant combinations. USDA received78 applications requesting grant-only funding, and 53 applications requesting loan-grant combination funding. USDA has made three awards under the program, totaling $16,399,401 in funding in three states. USDA is currently reviewing applications and will announce additional awards on a rolling basis.
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USDA Awards $9.75 Million ReConnect Program Broadband Grant In South Carolina
October 22, 2019 – The U.S. Department of Agriculture has announced that the second ReConnect Pilot Program broadband grant, in the amount of $9,750,000, has been awarded to Orangeburg, County, South Carolina. The grant will be used to deploy a fiber-to-the-home broadband network capable of simultaneous transmission rates of 100 Mbps or greater. The service areas funded by the $9.75 million grant include 3,911 households, 21 farms, 17 rural businesses, 13 educational facilities, nine critical community facilities and a health care center. USDA’s $600 million ReConnect Program provides loans and grants to construct broadband infrastructure in rural America. USDA received 146 applications for the first round of funding, requesting $1.4 billion across all three ReConnect Program funding categories: 100 percent loan, 100 percent grant, and loan-grant combinations. USDA received78 applications requesting grant-only funding, and 53 applications requesting loan-grant combination funding. USDA is currently reviewing applications and will announce additional awards on a rolling basis.
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NRECA Calls For Congressional Action To Prevent Electric Co-Ops That Accept Broadband Grants From Losing Tax-Exempt Status
October 22, 2019 – The CEO of the National Rural Electric Cooperative Association (NRECA) has penned an op-ed calling on Congress to take action to prevent electric cooperatives that accept government broadband grants from losing their tax-exempt status. Electric co-ops are recognized as tax-exempt organizations, but only if at least 85 percent of their income comes from their members. Under the Tax Cuts and Jobs Act of 2017, if an electric co-op accepts a government broadband grant, it could lose its tax-exempt status. In other words, a broadband grant could result in the co-op’s non-member revenue exceeding 15 percent of total revenue, causing a loss of tax-exempt status. NRECA wants Congress to pass the “Revitalizing Underdeveloped Rural Areas and Lands Act of 2019,” also referred to as the “RURAL Act” of 2019. If passed, it would amend Section 501(c)(12) of the Internal Revenue Code to modify the definition of income for purposes of determining the tax-exempt status of certain mutual or cooperative telephone or electric companies. The bi-partisan bill was introduced in April 2019, and then referred to the House Committee on Ways and Means. It has seen no further action.
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USDA Awards $2.85 Million ReConnect Program Broadband Grant In Tennessee
October 18, 2019 – The U.S. Department of Agriculture has announced that the first ReConnect Pilot Program broadband grant has been awarded to Tennessee’s Forked Deer Electric Cooperative. The company will use the $2,856,167 grant to deploy a fiber-to-the-home broadband network capable of simultaneous transmission rates of 100 Mbps or greater. The high-speed broadband infrastructure will create or improve connectivity for 347 rural households and one critical community facility spread over approximately 435 square miles in Tennessee. USDA’s $600 million ReConnect Program provides loans and grants to construct broadband infrastructure in rural America. USDA received 146 applications for the first round of funding, requesting $1.4 billion across all three ReConnect Program funding categories: 100 percent loan, 100 percent grant, and loan-grant combinations. USDA received78 applications requesting grant-only funding, and 53 applications requesting loan-grant combination funding. USDA is currently reviewing applications and will announce additional awards on a rolling basis.
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FCC Designates Mid-Hudson Data Corp. As An ETC In CAF II Areas In New York
October 18, 2019 – The FCC’s Wireline Competition Bureau has designated Mid-Hudson Data Corp. as an eligible telecommunications carrier (ETC) in certain high-cost areas within the state of New York. Specifically, the ETC designation is limited to those areas where Mid-Hudson is authorized to receive Connect America Fund support awarded in coordination with New York’s New NY Broadband Program. In January 2018, Mid-Hudson was awarded funding for a broadband deployment project that will serve 459 locations in New York. The project will be supported with a combination of equity funding, New York State grant funding, and federal CAF support. Mid-Hudson Data is a wholly owned subsidiary of Mid-Hudson Cablevision Holdings, Inc. Together with its affiliates, including Mid-Hudson Cablevision, Inc. and Mid-Hudson Broadband, LLC, the company provides broadband, video, and VOIP phone services to customers in Massachusetts and the State of New York.
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State Members Of Universal Service Joint Board Recommend Changes To USF Contribution Mechanism
October 15, 2019 – The state members of the Federal-State Joint Board on Universal Service have submitted a Recommended Decision to the FCC that proposes changing the existing contribution mechanism for federal universal service programs. Specifically, the state members recommend expanding the universal service fund (USF) contribution base “to include a broader class of services that touch the public communications network,” including broadband Internet access service. They also recommend the FCC adopt a connections-based USF assessment on residential communications services and an expanded revenues-based assessment on business services. The submission is the state members’ response to an FCC request for recommendations on how to modify the USF contribution system. The FCC made the request in August of 2014, and asked the Joint Board to present its proposals in April 2015. In a letter accompanying the Recommended Decision, the state members explain that during a February 2019 meeting, the federal members of the Joint Board refused to consider the state members’ proposals. The letter then states that there has been no further meetings or communication among the state and federal Joint Board members. The state members decided to submit their proposals to the FCC, in part because they “see nothing productive coming from prolonging the silence between the [state and federal members].”
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Sixth Waive! FCC Authorizes $61.8 Million In CAF II Auction Funding
October 10, 2019 – The FCC’s Wireline Competition Bureau has authorized $61,825,182.50 in Connect America Fund Phase II Auction support for 387 winning bids. This is the sixth wave of CAF II Auction support that has been authorized, bringing total authorized funding to nearly $1.2 billion, which is expected to expand broadband connectivity to 409,661 homes and businesses nationwide. The Bureau authorized the support amounts after reviewing the information in each entity’s Auction 903 long-form application, including the letters of credit and Bankruptcy Code opinion letters. A list of the authorized long-form applicants and their winning bids is available as Attachment A to the Bureau’s Public Notice. The following entities will receive the authorized support over the next 10 years to expand broadband to nearly 22,000 unserved rural homes and businesses in 14 states:
Allen's T.V. Cable Service, Inc.
Broadband Corp
Computer 5 Inc. d/b/a LocalTel Communications
CRC Communications LLC
Farmers Mutual Telephone Company
Frontier California Inc
Gallatin Wireless Internet, LLC
Independent Networks, L.C.
Inventive Wireless of Nebraska, LLC
Maquoketa Valley Rural Electric Cooperative
Oklahoma Fiber, LLC
Sunset Digital Communications, LLC
Tri County Telephone Association, Inc.
Twin Valley Communications, Inc
Union Telephone Company
The Universal Service Administrative Company may now obligate and disburse Universal Service Fund support to each entity, with payments beginning at the end of October 2019 and continuing until 120 equal monthly payments have been made. These CAF II auction support recipients are required to begin commercially offering broadband service to 40 percent of their requisite number of the locations by the end of the third year of funding, and to an additional 20 percent in each subsequent year, with 100 percent by the end of the sixth year. Additionally, the Bureau has announced it will post a state-level summary under the “Data” tab on the Auction 903 webpage. The summary will provide for each long-form applicant included in this most recent authorization: (1) the total support amount over 10 years and total number of locations that the long-form applicant is being authorized for in each state, (2) the total number of locations to which the authorized support recipient must offer the required voice and broadband services for each performance tier and latency in each state, and (3) the eligible census blocks included in the winning bids that are being authorized in each state.
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USDA Announces $152 Million Awarded For Rural Broadband Grants & Loans
October 7, 2019 – The U.S. Department of Agriculture (USDA) has announced that it is investing $152 million in 20 projects to provide or improve rural broadband service in 14 states: Illinois, Indiana, Kentucky, Minnesota, Missouri, North Carolina, North Dakota, Oklahoma, Pennsylvania, Tennessee, Texas, Virginia, West Virginia and Wisconsin. USDA’s Press Release includes the following summaries of three projects that will receive funding:
Logan Telephone Cooperative Inc. will use a $34.4 million Telecommunications Program loan to upgrade a Fiber-to-the-Home system in Butler, Logan and Muhlenberg counties in southwestern Kentucky. The system will enable families, educators and businesses to access higher-speed broadband internet. More than 5,300 residential and business customers will benefit.
In Morton County, N.D., USDA is partnering with BEK Communications Cooperative by providing an $844,000 Community Connect Program grant to help spark economic and educational opportunities, enhance health care and bolster public safety. BEK will deploy a 49-mile Fiber-to-the Home network. This project will bring high-speed broadband to 125 underserved households.
In southwest Virginia, iGo Technology Inc. will use a $3 million Community Connect grant to bring enhanced broadband opportunities to 820 homes and businesses. Part of the grant will be used to provide free broadband services at The Bee Community Center, in the town of Bee in Dickenson County, for two years.
USDA is providing the funding through the Community Connect Grant Program, the Telecommunications Infrastructure Loan Program, and the Rural Broadband Access Loan and Loan Guarantee Program.
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Rural Broadband Advocates Urge Congress To Provide More Funding For USDA ReConnect Program
October 7, 2019 – A diverse group of associations that advocate for broadband access in rural America has sent a letter to the ranking members of the House and Senate appropriations committees urging them to include funding for the U.S. Department of Agriculture’s ReConnect Program in Fiscal Year 2020. The ReConnect Program provides loans and grants for the costs of construction, improvement, or acquisition of facilities and equipment needed to provide broadband service in rural areas. USDA is currently reviewing applications filed during the first round of funding. In their letter, the rural associations explain they “are concerned that a lapse in appropriations in Fiscal Year 2020 will deny funds for those communities in need of broadband and interested in pursuing ReConnect funding.” The associations that signed the letter include NTCA–The Rural Broadband Association, the National Rural Electric Cooperative Association, the Center for Rural Affairs, CoBank, WTA–Advocates for Rural Broadband, and others.
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FCC Ready To Authorize CAF II Auction Support For 566 Winning Bids
September 30, 2019 – The FCC’s Wireline Competition Bureau has announced it is ready to authorize Connect America Fund Phase II auction for 566 winning bids. Three broadband providers account for the 566 winning bids: Cherokee Telephone Company (five winning bids in Oklahoma); Horry Telephone Cooperative, Inc. (three winning bids in South Carolina); and Viasat Carrier Services, Inc. (winning bids in various states). A list showing the winning bids is available as Attachment A to the Bureau’s Public Notice. Before the long-form applicants receive the total 10-year support amounts associated with their winning bids, the applicants must submit acceptable irrevocable stand-by letters of credit and Bankruptcy Code opinion letters for each state where they have winning bids that are ready to be authorized prior to 6:00 p.m. ET on Tuesday, October 15, 2019. In a future public notice, the Bureau will authorize support for specific winning bids for which all requirements have been met.
Additionally, the Bureau has announced it has waived the requirement that CAF II auction long-form applicants certify that they are eligible telecommunications carriers (ETCs) on or before February 25, 2019, for satellite provider Viasat Carrier Services, Inc., with respect to Viasat’s ETC designation in the states of Georgia, Idaho, Kentucky, Louisiana, Maine, Montana, and Wisconsin. The FCC previously explained that it would presume a CAF II auction long-form applicant has undertaken good faith efforts to obtain ETC designation if the applicant submitted an ETC petition to the relevant authority within 30 days of the release of the Auction 903 Closing Public Notice. Because Viasat filed petitions for ETC designation with the respective state regulatory commissions within the 30-day time frame, the Bureau concluded Viasat demonstrated due diligence and acted in good faith.
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Alaska Regulatory Commission Considers Early Termination Of State Universal Service Fund
September 20, 2019 – The Regulatory Commission of Alaska is considering whether to close the Alaska universal service fund early because it “is running out of money.” The fund is currently scheduled to end in 2023. Alaska’s state universal service fund was established in December 1998 to promote the efficiency, availability, and affordability of basic universal telephone service in Alaska. It is financed through surcharge fees applied to phone service provided in Alaska. Every year, the Alaska Universal Service Administrative Company calculates the surcharge factor used to fund the program for the coming year and submits the proposed surcharge for review by the Alaska Regulatory Commission. The Alaska universal service fund grew from $3.5 million in 1999 (with 1.8% surcharge factor) to approximately $27.5 million in 2016 (with a 14.2% surcharge factor at year-end). In 2018, the fund disbursed $29.5 million to Alaska telecom companies. In August 2018, the Regulatory Commission of Alaska made significant revisions to the fund, including Capping the fund’s surcharge at 10%; Eliminating the State Lifeline and Link Up support programs; Initiating a two-year phasedown of a support program that addressed switching costs for several rural carriers; Revising Carrier of Last Resort and Carrier Common Line support, and freezing that support at historic 2016 values, and eliminating all such support for newly defined “non-remote” areas of Alaska; and Terminating the fund in its entirety on June 30, 2023, with a mandatory comprehensive review two years before the termination date to determine the future of the fund. The Regulatory Commission of Alaska is consider a number of options for terminating the fund earlier, but has not yet taken action.
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FCC Grants ETC Designation To Viasat In CAF II Auction Areas In Alabama, California, Florida & West Virginia
September 18, 2019 – The FCC’s Wireline Competition Bureau has designated satellite provider Viasat Carrier Services, Inc. as an eligible telecommunications carrier (ETC) in areas within Alabama, California, Florida, and West Virginia where Viasat is authorized to receive Connect America Fund Phase II auction support. The Bureau granted Viasat’s ETC request after concluding that Viasat meets the eligibility requirements to receive universal service support, as set forth in the Communications Act of 1934 and related FCC rules. Additionally, the Bureau waived, on its own motion, the requirement that CAF Phase II auction winners submit proof of ETC designation on or before February 25, 2019.
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USF Contribution Factor Reaches 25 Percent For Fourth Quarter Of 2019 – Another New Record!
September 12, 2019 – The Federal Communications Commission’s Office of Managing Director (OMD) has announced that the proposed universal service fund (USF) contribution factor for the fourth quarter of 2019 will be 25 percent, a new record high. The 25 percent contribution factor breaks the previous all-time high USF contribution factor of 24.4 percent, which was used for the third quarter of 2019. This gives 2019 the highest yearly average USF contribution factor ever – 22.05 percent. Below are the universal service contribution factors for each quarter of 2019-2016, along with the yearly average:
2019: Q1-20; Q2-18.8; Q3-24.4; Q4-25
2019 Average: 22.05
2018: Q1-19.5; Q2-18.4; Q3-17.9; Q4-20.1
2018 Average: 18.97
2017: Q1-16.7; Q2-17.4; Q3-17.1; Q4-18.8
2017 Average: 17.5
2016: Q1-18.2; Q2-17.9; Q3-17.9; Q4-17.4
2016 Average: 17.85
For the fourth quarter of 2019, the Universal Service Administrative Company (USAC) projects $11.017439561 billion in total interstate and international end-user telecommunications revenues will be collected. USAC estimates that $2.184230 billion will be needed to cover the total demand and expenses for all Federal universal service support mechanisms in the fourth quarter of 2019. If the FCC takes no action on the proposed USF contribution factor within 14 days, it will be declared approved. Historical information on quarterly universal service fund contribution factors is available online from the FCC.
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Fifth Wave: FCC Authorizes $112 Million In CAF II Auction Funding
September 12, 2019 – The FCC’s Wireline Competition Bureau has authorized $112,183,454.30 in Connect America Fund Phase II auction support for 1,031winning bids. The Bureau authorized the support amounts after reviewing the information in each entity’s Auction 903 long-form application, including the letters of credit and Bankruptcy Code opinion letters. The Universal Service Administrative Company may now obligate and disburse Universal Service Fund support to each entity, with payments beginning at the end of September 2019 and continuing until 120 equal monthly payments have been made. These CAF II auction support recipients are required to begin commercially offering broadband service to 40 percent of their requisite number of the locations by the end of the third year of funding, and to an additional 20 percent in each subsequent year, with 100 percent by the end of the sixth year. Additionally, the Bureau has announced it will post a state-level summary under the “Data” tab on the Auction 903 webpage at https://www.fcc.gov/auction/903. The summary will provide for each long-form applicant included in this most recent authorization: (1) the total support amount over 10 years and total number of locations that the long-form applicant is being authorized for in each state, (2) the total number of locations to which the authorized support recipient must offer the required voice and broadband services for each performance tier and latency in each state, and (3) the eligible census blocks included in the winning bids that are being authorized in each state.
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FCC Fines AMG $100,000 For Prohibited Communications During CAF II Auction
September 6, 2019 – The FCC’s Enforcement Bureau has proposed a forfeiture of $100,000 against AMG Technology Investment Group, LLC (AMG), for apparently repeatedly engaging in prohibited communications of its bidding and bidding strategies during the Connect America Fund (CAF) Phase II auction, and its failure to timely report such prohibited communications. AMG, which provides service as NextLink, was a CAF II auction winning bidder in six states: Kansas, Illinois, Iowa, Nebraska, Oklahoma, and Texas. AMG was awarded CAF II auction support amounting to $281 million over 10 years, in exchange for deploying broadband services to 100,581 total locations.
According to the FCC’s Notice Of Apparent Liability For Forfeiture, AMG engaged in prohibited communications of its bidding, bidding strategies, and bidding results to AT&T Services, Inc. (AT&T), the parent company of CAF Phase II auction applicant New Cingular Wireless PCS, LLC, and reported the prohibited communications to the FCC outside of the required five-day reporting period. During the auction’s quiet period, one of AMG’s authorized bidders “sent more than a half-dozen e-mails to AT&T, including management-level personnel, discussing AMG’s [CAF II auction] bids, its bidding strategies, and bidding results.” AMG subsequently engaged in prohibited communications with AT&T following the close of the auction. AMG has 30 days to pay the full amount or file a written statement seeking reduction or cancellation of the proposed forfeiture.
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FCC Fines AT&T $75,000 For Prohibited Communications During CAF II Auction
September 6, 2019 – The FCC’s Enforcement Bureau has proposed a forfeiture of $75,000 against AT&T Services, Inc., for apparently repeatedly engaging in prohibited communications during the Connect America Fund (CAF) Phase II auction, and its failure to timely report such prohibited communications. According to the FCC’s Notice Of Apparent Liability For Forfeiture, AT&T, the parent company of CAF II auction applicant New Cingular Wireless PCS, LLC, apparently violated the FCC’s rules by engaging in prohibited communications with AMG Technology Investment Group, LLC during the auction. More specifically, during the CAF II auction’s quiet period, AT&T received and responded to more than a half-dozen e-mails sent to various AT&T employees by AMG personnel, including one of AMG’s authorized bidders. The e-mails discussed AMG’s bidding, bidding strategies, and bidding results, and AT&T and AMG also met in person and by video conference within the quiet period and discussed CAF II auction related business opportunities. In a separate action, the FCC’s Enforcement Bureau proposed a forfeiture of $100,000 against AMG for these prohibited communications. AT&T has 30 days to pay the full amount or file a written statement seeking reduction or cancellation of the proposed forfeiture.
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USAC Files Fourth Quarter 2019 Contribution Base Data: $11.017 Billion
September 1, 2019 – The Universal Service Administrative Company (USAC) has filed information on the universal service contribution base to be used for the fourth quarter of calendar year 2019. The total projected collected interstate and international end-user revenue base for 4Q2019 is $11,017,439,561, which was derived using projected collected revenue reported on the FCC Form 499-Q submissions. Upon FCC approval of universal service fund support mechanisms quarterly funding requirements, projected administrative costs, and total contribution base, the FCC will establish a quarterly USF contribution factor. USAC will then bill USF contributors on a monthly basis for their individual obligations based on the approved contribution factor.
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FCC Ready To Authorize CAF II Auction Support For 375 Winning Bids
August 26, 2019 – The FCC’s Wireline Competition Bureau has announced it is ready to authorize Connect America Fund Phase II auction support for 375 winning bids. A list of the winning bids that are ready to be authorized is available as Attachment A to the Bureau’s Public Notice. Before the long-form applicants receive the total 10-year support amounts associated with their winning bids, the applicants must submit acceptable irrevocable stand-by letters of credit and Bankruptcy Code opinion letters for each state where they have winning bids that are ready to be authorized prior to 6:00 p.m. ET on Tuesday, September 10, 2019. In a future public notice, the Bureau will authorize support for specific winning bids for which all requirements have been met.
Additionally, the Bureau has announced it has waived the requirement that CAF II auction long-form applicants certify that they are eligible telecommunications carriers (ETCs) on or before February 25, 2019, for Oklahoma Fiber, LLC in Oklahoma. The FCC previously explained that it would presume an auction long-form applicant has undertaken good faith efforts to obtain ETC designation if that applicant submitted an ETC petition to the relevant authority within 30 days of the release of the Auction 903 Closing Public Notice. Because Oklahoma Fiber, LLC filed its petition with the Oklahoma Corporation Commission within the 30-day time frame, the Bureau concluded Oklahoma Fiber, LLC demonstrated due diligence and acted in good faith.
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171 Rate-Of-Return Companies Choose A-CAM II Support
August 22, 2019 – The FCC’s Wireline Competition Bureau has announced that 171 rate-of-return companies have elected 184 offers of Alternative Connect America Cost Model (A-CAM) II support. Each company will receive A-CAM II support for a ten-year period, from January 1, 2019 to December 31, 2028. Total annual support A-CAM II support for the 171 companies amounts to $491,442,714, with the 10-year total standing at $4.9 billion. A total of 35 rate-of-return companies will receive transition payments because their annual A-CAM II support amounts are less than the legacy support they received in 2018. The Bureau has released Authorization Report 6.0, showing the amount of model-based universal service support each company is authorized to receive, as well as the number of funded locations and the broadband service obligation. In total, the 171 companies “are committing to provide at least 25/3 Mbps service to over 363,000 locations, including over 37,000 locations on Tribal lands.” Each A-CAM II carrier is subject to defined broadband deployment obligations that must be met over the 10-year support period, and must make annual progress reports.
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Rural Digital Opportunity Fund Comments Due September 20th
August 21, 2019 – The FCC’s Notice of Proposed Rulemaking to establish the Rural Digital Opportunity Fund (RDOF) has been published in the Federal Register, setting the comment deadlines. Comments are due on or before September 20, 2019 and reply comments are due on or before October 21, 2019. In the NPRM, the FCC proposes using a multi-round reverse-auction to provide at least $20.4 billion in RDOF funding over the next 10 years to support broadband networks in rural America. The auction will favor faster broadband services with lower latency. The FCC is targeting RDOF funding to the more than 10 million households and small businesses in price cap areas that still lack access to broadband services at speeds of at least 25/3 Mbps; more than 7 million of which are located in rural areas. RDOF support will be distributed in two phases: Phase I will focus on those areas of the country that are wholly unserved, and Phase II will target (1) any areas not won in Phase I, and (2) census blocks that are partially served once the FCC has granular information about which areas are already served with broadband.
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FCC Delays CAF II Post-Auction Location Adjustment Process
August 19, 2019 – The FCC’s Wireline Competition Bureau has delayed initiation of the Connect America Fund (CAF) Phase II post-auction eligible location adjustment process. It would have allowed CAF II auction winners to adjust their deployment obligations and support amounts when the total number of actual locations are less than the number of funded locations in the eligible census blocks within their winning bid areas in a state. Those participating in the eligible location adjustment process were required to submit, within one year after release of the CAF Phase II auction closing public notice (August 28, 2019), evidence of the total number of locations in their eligible areas, including geolocation data, in a format specified by the Bureau. However, the Bureau never issued a public notice or order detailing specific instructions, deadlines, and requirements for filing valid geolocation data and evidence. It released a Public Notice in September 2018, seeking comment on several eligible location adjustment proposals, and then in June 2019, it sought comment on approaches to identify and resolve location discrepancies for rate-of-return carriers receiving A-CAM support. At a future date, the Bureau will adopt specific procedures and requirements for the eligible location adjustment process and announce a new filing deadline for participants.
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CAF II Auction Winner Sunset Digital Communications, LLC Designated An ETC In Parts Of Tennessee & Virginia
August 13, 2019 – The FCC’s Wireline Competition Bureau has designated Sunset Digital Communications, LLC as an eligible telecommunications carrier (ETC) in parts of Tennessee and Virginia. SDC LLC’s ETC designation applies in high-cost areas where it was a winner bidder in the CAF Phase II Auction. SDC LLC won $ 5,595,554.80 in CAF II Auction funding in Tennessee and $ 23,979,452.60 in Virginia to serve 2,095 and 6,998 locations, respectively. In the ETC designation Order, the Bureau waived, on its own motion, the requirement that SDC LLC submit proof of its ETC designation on or before February 25, 2019.
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Fourth Wave: FCC Authorizes $121 Million CAF II Auction Funding For 539 Winning Bids
August 12, 2019 – The FCC’s Wireline Competition Bureau has authorized $121,177,648.80 in Connect America Fund Phase II Auction support for 593 winning bids. The Bureau authorized the support amounts after reviewing the information in each entity’s Auction 903 long-form application, including the letters of credit and Bankruptcy Code opinion letters. The Universal Service Administrative Company may now obligate and disburse Universal Service Fund support to each entity, with payments beginning at the end of August 2019 and continuing until 120 equal monthly payments have been made. These CAF II auction support recipients are required to begin commercially offering broadband service to 40 percent of their requisite number of the locations by the end of the third year of funding, and to an additional 20 percent in each subsequent year, with 100 percent by the end of the sixth year. Additionally, the Bureau has announced it will soon post a state-level summary under the “Data” tab on the Auction 903 webpage at https://www.fcc.gov/auction/903. The summary will provide for each long-form applicant included in this most recent authorization: (1) the total support amount over 10 years and total number of locations that the long-form applicant is being authorized for in each state, (2) the total number of locations to which the authorized support recipient must offer the required voice and broadband services for each performance tier and latency in each state, and (3) the eligible census blocks included in the winning bids that are being authorized in each state.
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FCC Authorizes CAF Phase II Support For Three New York Broadband Providers
August 12, 2019 – The FCC’s Wireline Competition Bureau has authorized million Connect America Fund Phase II support for the following three New York broadband providers: Armstrong Telecommunications, Inc.; DTC Cable Inc.; and Haefele TV Inc. The total support is $16,183,329 over ten years. The three broadband providers will use the funding to bring broadband service to 8,088 locations in 571 census blocks. The Bureau authorized the support amounts after reviewing the information in each entity’s long-form application, including the letters of credit and Bankruptcy Code opinion letters. The Universal Service Administrative Company may now obligate and disburse Universal Service Fund support to each entity, with payments beginning at the end of August 2019 and continuing until 120 equal monthly payments have been made. These CAF II support recipients are required to begin commercially offering broadband service to 40 percent of their requisite number of the locations by the end of the third year of funding, and to an additional 20 percent in each subsequent year, with 100 percent by the end of the sixth year. In an attachment to the Public Notice announcing the funding, the Bureau has provided a summary of CAF II funding authorized for New York broadband providers: (1) total support amounts over 10 years and total number of funded locations; (2) the total number of locations to which each authorized support recipient must offer the required voice and broadband services for each performance tier and latency; and (3) the eligible census blocks included in the winning bids that are being authorized.
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New FCC Fraud Division Up & Running; Will Police Universal Service Fund Programs
August 12, 2019 – The FCC Enforcement Bureau’s new fraud division has officially launched. It will investigate and prosecute fraud, waste, and abuse in the four universal service fund programs and other funding programs that the FCC oversees, and will work closely with the FCC’s Office of Inspector General, the U.S. Department of Justice, and other law enforcement agencies. Comprised of existing FCC staff, the fraud division was created in February 2019, but only recently received approval by the House and Senate Appropriations Committees, and the Office of Management and Budget.
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Indiana Announces $22 Million In Broadband Grants
August 8, 2019 – Indiana Governor Eric J. Holcomb has announced $22.1 million in funding for 11 broadband expansion infrastructure projects. The funding is part of the initial round of Indiana’s Next Level Broadband program. The seven grant recipients – six telecommunications providers and one utility cooperative – will contribute $14 million in matching funds, resulting in $36.1 million total investment for broadband. According to the press release, the funding will provide broadband infrastructure to more than 4,800 homes and commercial locations in 12 counties.
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Arkansas Creates $25 Million Broadband Grant Program
August 6, 2019 – Arkansas Governor Asa Hutchinson has announced the creation of “Arkansas Rural Connect,” a new $25 million broadband grant program. The program will attempt to meet the goal of deploying high-speed broadband Internet access service – at a rate of 25 Mbps downstream and 3 Mbps upstream – to all Arkansas communities with more than 500 residents by 2022. This goal was outlined in Arkansas’ State Broadband Plan, which was released in May 2019. The new broadband grant program will be housed within the Arkansas State Broadband Office. Further details and the rules for the Arkansas Rural Connect grant program will be developed in the near future. According to the press release, the program is expected to prioritize applications that partner with ISPs to deploy broadband at 25/3 Mbps speeds to all residents of a community; share project costs and provide facilitation for the project by procuring rights-of-way for wireline deployments; seek to serve communities that have a population of at least 500 with less than 50 percent of the population covered by broadband speeds of 25/3 Mbps; and that provide service that does not constrain normal Internet use.
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Now Accepting Applications: $20 Million Connecting Michigan Communities Grant Program
July 2, 2019 – Michigan Governor Gretchen Whitmer has announced the opening of applications for the Connecting Michigan Communities (CMIC) grant program to increase broadband in underserved areas of Michigan. The application window runs from July 1 through August 30. Grant awards are scheduled to be announced in April of 2020, and all awarded projects must be completed by September 30, 2023. Funding priority will be given to applications that demonstrate collaboration to achieve community investment and economic development goals. Applicants must also show they have the managerial, financial, and technical abilities to build, operate, and manage a broadband network. Applicants can apply for up to $5 million per grant and can apply for multiple projects. The scoring criteria includes, among other things, community and economic development, readiness to build, operate, and maintain the project, and the long-term viability of the project. The grant application and additional information are available online at the CMIC grant program website.
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