[Federal Register: August 3, 2007 (Volume 72, Number 149)]
[Rules and Regulations]
[Page 43131-43137]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr03au07-1]
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Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
Prices of new books are listed in the first FEDERAL REGISTER issue of each
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[[Page 43131]]
DEPARTMENT OF AGRICULTURE
Rural Utilities Service
7 CFR Part 1739
RIN 0572-AC09
Community Connect Broadband Grant Program
AGENCY: Rural Utilities Service, USDA.
ACTION: Direct final rule.
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SUMMARY: The Rural Utilities Service, an agency delivering the United
States Department of Agriculture (USDA) Rural Development Utilities
Program, hereinafter referred to as Rural Development and/or the
Agency, amends its regulations for the Community-Oriented Connectivity
Broadband Grant Program (Community Connect Grant Program). Since the
inception of the Community Connect Grant Program, the Agency has faced
the challenge of identifying eligible rural communities. The Agency has
reviewed its method of identifying eligible communities and has
determined that modifications to the program regulations are required
in order to expand the resource material used to identify eligible
communities. The use of additional resources should increase the number
of communities eligible for grant funding. Additionally, the Agency has
changed the test for economic hardship. The current regulations compare
an applicant community's per capita personal income to the national per
capita personal income. Because of the varying costs of living among
the states, it was determined that a better measure of economic
distress would be a comparison of the applicant community's median
household income to that of its state. This change is also expected to
increase the number of eligible grant applicants. Lastly, this rule
amends the current regulations by specifying operating expenses which
the Agency has approved for grant funding. These changes have been
determined to be non controversial and are being enacted as a direct
final rule.
This rule is not applicable to Community Connect grant applications
filed for funding during fiscal year 2007.
DATES: Effective Date: This rule is effective September 17, 2007,
without further action, unless the Agency receives adverse comments
within September 4, 2007. If adverse comments are received, the Agency
will publish a timely Federal Register document withdrawing this rule.
Comment Due Date: Comments must be received on or before September 4,
2007.
ADDRESSES: Submit comments by either of the following methods:
Federal eRulemaking Portal: Go to http://www.regulations.gov
and, in the lower ``Search Regulations and Federal
Actions'' box, select ``Rural Utilities Service'' from the agency drop-
down menu, then click on ``Submit.'' In the Docket ID column, select
RUS-07-Telecom-0008 to submit or view public comments and to view
supporting and related materials available electronically. Information
on using Regulations.gov, including instructions for accessing
documents, submitting comments, and viewing the docket after the close
of the comment period, is available through the site's ``User Tips''
link.
Postal Mail/Commercial Delivery: Please send your comment
addressed to Michele Brooks, Acting Deputy Director, Program
Development and Regulatory Analysis, USDA Rural Development, STOP 1522,
Room 5159, 1400 Independence Avenue, Washington, DC 20250-1522. Please
state that your comment refers to Docket No. RUS-07-Telecom-0008.
Other Information: Additional information about Rural Development
and its programs is available at http://www.rurdev.usda.gov/index.html.
FOR FURTHER INFORMATION CONTACT: Kenneth Kuchno, Director, Broadband
Division, USDA Rural Development Utilities Program, STOP 1599, 1400
Independence Avenue, SW., Washington, DC 20250-1599, Telephone (202)
690-4673, Facsimile (202) 690-4389. E-mail address:
kenneth.kuchno@usda.gov.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This final rule has been determined to be not significant for
purposes of Executive Order 12866, and therefore has not been reviewed
by the Office of Management and Budget (OMB).
Catalog of Federal Domestic Assistance
The Catalog of Federal Domestic Assistance (CFDA) Program number
assigned to the Community Connect Grant Program is 10.863. The Catalog
is available on a subscription basis from the Superintendent of
Documents, the United States Government Printing Office, Washington, DC
20402-9325; telephone (202) 512-1800.
Executive Order 12372
This program is not subject to the requirements of Executive Order
12372, ``Intergovernmental Review of Federal Programs,'' as implemented
under USDA's regulations at 7 CFR part 3015.
Executive Order 12988
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. The Agency has determined that this rule meets the
applicable standards provided in section 3 of the Executive Order. In
addition, all state and local laws and regulations that are in conflict
with this rule will be preempted, no retroactive effect will be given
to this rule, and, in accordance with Sec 212(e) of the Department of
Agriculture Reorganization Act of 1994 (7 U.S.C. 6912(e)),
administrative appeal procedures, if any, must be exhausted before an
action against the Department or its agencies may be initiated.
Executive Order 13132, Federalism
The policies contained in this rule do not have any substantial
direct effect on states, on the relationship between the national
government and the states, or on the distribution of power and
responsibilities among the various levels of government. Nor does this
final rule impose substantial direct compliance costs on state and
local governments. Therefore, consultation with states is not required.
Regulatory Flexibility Certification
Pursuant to 5 U.S.C. 553(a)(2), this final rule related to grants
is exempt from the rulemaking requirements of the Administrative
Procedure Act (5 U.S.C. 551 et seq.), including the requirement to
provide prior notice and an
[[Page 43132]]
opportunity for public comment. Because this final rule is not subject
to a requirement to provide prior notice and an opportunity for public
comment pursuant to 5 U.S.C. 553, or any other law, the analytical
requirements of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.)
are inapplicable.
Unfunded Mandates
This final rule contains no Federal mandates (under the regulatory
provision of Title II of the Unfunded Mandates Reform Act of 1995) for
State, local, and tribal governments or the private sector. Therefore,
this final rule is not subject to the requirements of sections 202 and
205 of the Unfunded Mandates Reform Act of 1995.
Environmental Impact Statement
This final rule has been examined under Agency environmental
regulations at 7 CFR part 1794. The Administrator has determined that
this action is not a major Federal action significantly affecting the
environment. Therefore, in accordance with the National Environmental
Policy Act of 1969 (42 U.S.C. 4321 et seq.), an Environmental Impact
Statement or Assessment is not required.
Information Collection and Recordkeeping Requirements
This rule contains no new reporting or recordkeeping burdens under
OMB control number 0572-0127 that would require approval under the
Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35).
Background
Overview
The USDA Rural Development Utilities Programs (the Agency) improve
the quality of life in rural America by providing investment capital,
in the form of loans and grants, for the deployment of rural
telecommunications infrastructure. Financial assistance is provided to
rural utilities; municipalities; commercial corporations; limited
liability companies; public utility districts; Indian tribes; and
cooperative, nonprofit, limited-dividend, or mutual associations. In
order to achieve the goal of increasing economic opportunity in rural
America, the Agency finances infrastructure that enables access to a
seamless, nation-wide telecommunications network. With access to the
same advanced telecommunications networks of its urban counterparts,
especially broadband networks designed to accommodate distance
learning, telework and telemedicine, rural America will see improving
educational opportunities, health care, economies, safety and security,
and ultimately higher employment. Of particular concern to the Agency
are communities where broadband service is not available and where
population densities are such that the cost of deployment to them is
high and build-out of infrastructure is unlikely. The Agency is
committed to ensuring rural communities will have access to affordable,
reliable, advanced communications services, comparable to those
available throughout the rest of the United States, to provide a
healthy, safe and prosperous place to live and work.
The Community Connect Grant Program was started as a Pilot Program
with the Fiscal Year 2002 budget and has been funded ever since through
the appropriations process. After administering the program as a pilot
program for two years, the Agency proposed rules for the program, and
on July 28, 2004, the current rules were published, and the program was
formally implemented. Since then more than 670 requests for grant funds
totaling over $410 million were requested through Fiscal Year 2006. Of
those requests, 129 were granted for $57 million to bring broadband
service to 129 communities in 26 states and Puerto Rico.
While the Agency is proud of the results achieved in the Community
Connect Grant Program thus far, it believes that the overall
effectiveness of the program can be improved by modifying the existing
rules. Through these changes, the Agency is increasing eligibility
criteria to include communities that clearly meet the intent of the
program. Specifically, this rule will: (1) Add the Rand McNally Atlas
as a community locator; (2) change the income measure for eligibility
from a national comparison to a state comparison; and (3) clarify the
items that are eligible to be considered as operating expenses.
Discussion of Changes
1. Adding the Rand McNally Atlas as a community locator. Currently
the regulation states that a project must serve an incorporated or
unincorporated town, village, or borough recognized in the latest
decennial census of the Bureau of the Census to be eligible for
funding. While this program has been successful in reaching much of
rural America, the Agency recognizes that areas not identified in the
2000 census are excluded from funding. It is advisable to add another
resource, updated more frequently than the decennial census and
including communities not found in the census, to identify rural
communities. The Agency therefore adds the Rand McNally Atlas as a
resource to identify rural communities. It is anticipated that the
addition of the Rand McNally Atlas as a community locator will increase
the number of communities eligible for funding.
2. Change the income measure from a national comparison to a state
comparison. Rural communities that would otherwise be eligible for
grant funding have been previously excluded because their per capita
personal income is relatively high in comparison to the national
average. However, using the communities median household income
compared to their state's median household income, these communities
would qualify as economically challenged. Given the variable cost of
living among the states, the comparison of state statistics is a better
indicator of economic distress. The intent of this program is to allow
all rural communities without broadband service facing economic
hardship to fairly compete for funding. By comparing a community's
median household income to their state's median household income, all
rural economically challenged communities may compete fairly for
funding.
3. Clarify the items that are eligible to be considered as
operating expenses. Currently the regulation states that operating
expenses incurred in providing broadband transmission service to
critical facilities is an eligible purpose and that the salaries and
administrative costs associated with these expenses may be limited by
the Agency. Through the course of this program, applicants have not
clearly understood what operating expenses are eligible. Many
applicants have requested funds for ineligible operating expenses and
had to be eliminated from the grant competition. To assist the
applicant with better understanding what operating expenses are
considered eligible, the Agency is specifically defining the eligible
operating expenses.
Other corresponding changes were made throughout the regulation to
reflect the addition of the Rand McNally Atlas and the change to state
income measures.
List of Subjects in 7 CFR 1739
Broadband, Grant programs--Communications, Rural Areas,
Telecommunications, and Telephone.
0
For reasons set forth in the preamble, the Rural Utilities Service
amends Chapter XVII of title 7 of the Code of
[[Page 43133]]
Federal Regulations by revising part 1739 as follows:
PART 1739--BROADBAND GRANT PROGRAM
Subpart A--Community Connect Grant Program
Sec.
1739.1 Purpose.
1739.2 Funding availability and application dates and addresses.
1739.3 Definitions.
1739.4-1739.9 [Reserved]
1739.10 Eligible applicant.
1739.11 Eligible project.
1739.12 Eligible grant purposes.
1739.13 Ineligible grant purposes.
1739.14 Matching contributions.
1739.15 Completed application.
1739.16 Review of grant applications.
1739.17 Scoring of applications.
1739.18 Grant documents.
1739.19 Reporting and oversight requirements.
1739.20 Audit requirements.
1739.21 OMB control number.
Subpart B--[Reserved]
Authority: Title III, Pub. L. 108-199, 118 Stat. 3.
Subpart A--Community Connect Grant Program
Sec. 1739.1 Purpose.
(a) The provision of broadband transmission service is vital to the
economic development, education, health, and safety of rural Americans.
The purpose of the Community Connect Grant Program is to provide
financial assistance in the form of grants to eligible applicants that
will provide, on a ``community-oriented connectivity'' basis, broadband
transmission service that fosters economic growth and delivers enhanced
educational, health care, and public safety services. The Agency will
give priority to rural areas that it believes have the greatest need
for broadband transmission services, based on the criteria contained
herein.
(b) Grant authority will be used for the deployment of broadband
transmission service to extremely rural, lower-income communities on a
``community-oriented connectivity'' basis. The ``community-oriented
connectivity'' concept will stimulate practical, everyday uses and
applications of broadband by cultivating the deployment of new
broadband transmission services that improve economic development and
provide enhanced educational and health care opportunities in rural
areas. Such an approach will also give rural communities the
opportunity to benefit from the advanced technologies that are
necessary to achieve these goals.
Sec. 1739.2 Funding availability and application dates and
submission.
(a) The Agency will publish, annually in the Federal Register, a
Notice of Funds Availability (hereinafter ``NOFA'') that will set forth
the total amount of funding available; the maximum and minimum funding
for each grant; the application submission dates; and the appropriate
addresses and agency contact information. The NOFA will also outline
and explain the procedures for submission of applications, including
electronic submissions. The Agency may publish more than one NOFA
should additional funding become available.
(b) Notwithstanding paragraph (a) of this section, the Agency may,
in response to a surplus of qualified eligible applications which could
not be funded from the previous fiscal year, decline to publish a NOFA
for the following fiscal year and fund said applications without
further public notice.
Sec. 1739.3 Definitions.
As used in this subpart:
Agency shall mean the Rural Utilities Service, which administers
the United States Department of Agriculture (USDA) Rural Development
Utilities Programs.
Bandwidth means the capacity of the radio frequency band or
physical facility needed to carry the Broadband Transmission Service.
Basic Broadband Transmission Service means the broadband
transmission service level provided by the applicant at the lowest rate
or service package level for residential or business customers, as
appropriate, provided that such service meets the requirements of this
part.
Broadband Transmission Service means providing an information-rate
equivalent to at least 200 kilobits/second in the consumer's connection
to the network, both from the provider to the consumer (downstream) and
from the consumer to the provider (upstream).
Community means any incorporated or unincorporated town, village,
or borough recognized in the latest decennial census as published by
the Bureau of the Census or in the most recent edition of a Rand
McNally Atlas that is located in a Rural Area.
Community Center means a public building, or a section of a public
building with at least ten (10) Computer Access Points, that is used
for the purposes of providing free access to and/or instruction in the
use of broadband Internet service, and is of the appropriate size to
accommodate this purpose. The community center must be open and
accessible to area residents before, during, and after normal working
hours and on Saturday or Sunday.
Computer Access Point means a new computer terminal with access to
Basic Broadband Transmission Service.
Critical Community Facilities means the Community Center and every
public school or education center, public library, public medical
clinic, public hospital, community college, public university, or law
enforcement, fire and ambulance stations in the proposed Service Area.
Eligible Applicant shall have the meaning as set forth in Sec.
1739.10.
Eligible Grant Purposes shall have the meaning as set forth in
Sec. 1739.12.
End-User Equipment means computer hardware and software, audio or
video equipment, computer network components, telecommunications
terminal equipment, inside wiring, interactive video equipment, or
other facilities required for the provision and use of Broadband
Transmission Service.
Matching Contribution means the applicant's qualified contribution
to the Project, as outlined in Sec. 1739.14 of this part.
Project means the applicant's proposed Basic Broadband Transmission
Service financed by the grant and Matching Contribution for the
proposed Service Area.
Rural Area means any area, as verified by the latest decennial
census of the Bureau of the Census or the latest edition of the Rand
McNally Atlas, which is not located within the boundaries of any
incorporated or unincorporated city, village, or borough having a
population in excess of 20,000 inhabitants.
Service Area means a single Community, and may include the
unincorporated areas located outside and contiguous to the Community's
boundaries, in which the applicant proposes to provide Broadband
Transmission Service.
Spectrum means a defined band of frequencies that will accommodate
the Broadband Transmission Service.
Telecommunications Terminal Equipment means the assembly of
telecommunications equipment at the end of a circuit or path of a
signal, including but not limited to facilities that receive or
transmit over-the-air broadcast, satellite, and microwave, normally
located on the premises of the end user, that interfaces with
telecommunications transmission facilities, and that is used to modify,
convert, encode, or otherwise prepare signals to be transmitted via
such telecommunications facilities, or that is
[[Page 43134]]
used to modify, reconvert, or carry signals received from such
facilities, the purpose of which is to accomplish the goal for which
the circuit or signal was established.
Sec. Sec. 1739.4-1739.9 [Reserved].
Sec. 1739.10 Eligible applicant.
To be eligible for a grant, the applicant must:
(a) Be legally organized as an incorporated organization, an Indian
tribe or tribal organization, as defined in 25 U.S.C. 450b(b) and (c),
a state or local unit of government, or other legal entity, including
cooperatives or private corporations or limited liability companies
organized on a for-profit or not-for-profit basis.
(b) Have the legal capacity and authority to own and operate the
broadband facilities as proposed in its application, to enter into
contracts and to otherwise comply with applicable federal statutes and
regulations.
Sec. 1739.11 Eligible project.
To be eligible for a grant, the Project must:
(a) Serve a Rural Area where Broadband Transmission Service does
not currently exist, to be verified by the Agency prior to the award of
the grant;
(b) Serve one Community recognized in the latest U.S. Census or the
latest edition of the Rand McNally Atlas;
(c) Deploy Basic Broadband Transmission Service, free of all
charges for at least 2 years, to all Critical Community Facilities
located within the proposed Service Area;
(d) Offer Basic Broadband Transmission Service to residential and
business customers within the proposed Service Area; and
(e) Provide a Community Center with at least ten (10) Computer
Access Points within the proposed Service Area, and make Broadband
Transmission Service available therein, free of all charges to users
for at least 2 years.
Sec. 1739.12 Eligible grant purposes.
Grant funds may be used to finance:
(a) The construction, acquisition, or leasing of facilities,
including spectrum, to deploy Broadband Transmission Service to all
participating Critical Community Facilities and all required facilities
needed to offer such service to residential and business customers
located within the proposed Service Area;
(b) The improvement, expansion, construction, or acquisition of a
Community Center that furnishes free access to broadband Internet
service, provided that the Community Center is open and accessible to
area residents before, during, and after normal working hours and on
Saturday or Sunday. Grant funds provided for such costs shall not
exceed the greater of five percent (5%) of the grant amount requested
or $100,000;
(c) End-User Equipment needed to carry out the Project;
(d) (1) Operating expenses incurred in providing Broadband
Transmission Service to Critical Community Facilities for the first 2
years of operation and in providing training and instruction. In order
to qualify as eligible costs for grant coverage or as matching fund
contributions, operating expenses for providing broadband transmission
service to Critical Community Facilities must:
(i) Be incurred for the purpose of providing broadband service to
the Critical Community Facilities and be for costs incurred during the
first two years of operation; and
(ii) Be for the following purposes subject to the specified maximum
amounts:
(A) Salary for operations manager, not to exceed $30,000 per year.
(B) Salary for technical support staff, not to exceed $30,000 per
year.
(C) Salary for community center staff, not to exceed $25,000 per
year.
(D) Bandwidth expenses, not to exceed $25,000 per year.
(E) Training courses on the use of the Internet, not to exceed
$15,000 per year.
(2) The operating costs to be funded by the grant or used as
matching contributions cannot exceed in the aggregate $250,000. No
other operating expenses are eligible for grant funding or to be
considered as matching funds; and
(e) The purchase of land, buildings, or building construction
needed to carry out the Project.
Sec. 1739.13 Ineligible grant purposes.
(a) Grant funds may not be used to finance the duplication of any
existing Broadband Transmission Service provided by another entity.
(b) Facilities financed with grant funds cannot be utilized, in any
way, to provide local exchange telecommunications service to any person
or entity already receiving such service.
Sec. 1739.14 Matching contributions.
(a) The grant applicant must contribute a Matching Contribution
which is at least fifteen percent (15%) of the grant amount requested
and shall be in the form of:
(1) Cash for eligible grant purposes.
(2) In-kind contributions for purposes that could have been
financed with grant funds under this part. In-kind contributions must
be new or non-depreciated assets with established monetary values.
Manufacturers' or service providers' discounts shall not be considered
as a Matching Contribution.
(3) The rental value of space provided within an existing building
to be used as the Community Center, provided that the space is free of
charge to the applicant, for the first 2 years of operation.
(b) Costs incurred by the applicant, or by others on behalf of the
applicant, for facilities, installed equipment, or other services
rendered prior to submission of a completed application shall not be
considered as an Eligible Grant Purpose or Matching Contribution.
(c) Rental values of space provided must be substantiated by rental
agreements documenting the cost of space of a similar size in a similar
location.
(d) Any financial assistance from federal sources shall not be
considered as a Matching Contribution unless there is a federal
statutory exception specifically authorizing the federal financial
assistance to be considered as such.
Sec. 1739.15 Completed application.
A completed application must include the following documentation,
studies, reports and information in form satisfactory to the Agency.
Applications should be prepared in conformance with the provisions of
this part and applicable USDA regulations including 7 CFR parts 3015,
3016, and 3019. Applicants must use the Agency's Application Guide for
this program, found at http://www.usda.gov/rus/telecom/ containing
instructions and all necessary forms, as well as other important
information, in preparing their application. Paper copies of the
application guide can be requested by contacting the Director,
Broadband Division at the following address: Stop 1599, South
Agriculture Building, Room 2868, Washington, DC 20250. Completed
applications must include the following:
(a) An Application for Federal Assistance. A completed Standard
Form 424.
(b) An executive summary of the Project. The applicant must provide
the Agency with a general project overview that addresses the following
categories:
(1) A description of why the Project is needed;
(2) A description of the applicant;
(3) An explanation of the total Project cost;
(4) A general overview of the broadband telecommunications system
[[Page 43135]]
to be developed, including the types of equipment, technologies, and
facilities to be used;
(5) Documentation describing the procedures used to determine the
unavailability of existing Broadband Transmission Service; and
(6) A description of the participating Critical Community
Facilities.
(c) Scoring criteria documentation. Each grant applicant must
address and provide documentation on how it meets each of the scoring
criteria detailed in Sec. 1739.17.
(d) System design. The applicant must submit a system design that
contains the following, satisfactory to the Agency:
(1) A narrative discussing the proposed Community Center, all costs
of the Project, all existing and proposed facilities that are a part of
the Project, the services to be provided by the Project, and the
proposed Service Area;
(2) Engineering design studies providing an economical and
practical engineering design of the Project, including a detailed
description of the facilities to be funded, technical specifications,
data rates, and costs; and
(3) A map of the proposed Service Area reflecting the proposed
location of the Community Center and all participating Critical
Community Facilities.
(e) Scope of work. The scope of work must include, at a minimum:
(1) The specific activities and services to be performed under the
Project;
(2) Who will carry out the activities and services;
(3) The time-frames for accomplishing the Project objectives and
activities; and
(4) A budget for all capital and administrative expenditures
reflecting the line item costs for Eligible Grant Purposes, the
Matching Contribution, and other sources of funds necessary to complete
the Project.
(f) Community-Oriented Connectivity Plan. The applicant must
provide a Community-Oriented Connectivity Plan consisting of the
following:
(1) A listing of all participating Critical Community Facilities to
be connected. For those Critical Community Facilities in the Service
Area which will not be included in the Project, an explanation of why
they are not being included should be provided. The applicant must also
provide documentation that it has consulted with agents of all Critical
Community Facilities in the Service Area, and must provide statements
as to their willingness to participate, or not to participate, in the
proposed Project;
(2) A description of the services available to local residents
through the use of the Community Center;
(3) A listing of the proposed Telecommunications Terminal
Equipment, telecommunications transmission facilities, data terminal
equipment, interactive video equipment, computer hardware and software
systems, and components that process data for transmission via
telecommunications, computer network components, communication
satellite ground station equipment, or any other elements of the
Project designed to further the deployment and use of Broadband
Transmission Service, that the applicant intends to build or fund using
the Agency's grant funds and the Matching Contribution; and
(4) If other telecommunications carriers (including interexchange
carriers, cable television operators, enhanced service providers,
providers of satellite services and telecommunications equipment
manufacturers and distributors) are participating in the delivery of
services, a description of the consultations and the anticipated role
of such providers in the proposed Project.
(g) Financial information and sustainability. The applicant must
provide a narrative description demonstrating the sustainability of the
Project during the first two years and after completion and the
sufficiency of resources and expertise necessary to undertake and
complete the Project. The following financial information is required:
(1) Certified financial statements, if available; otherwise, the
most current income statement and balance sheet for existing
operations; and
(2) Pro-forma financial information for 5 years, evidencing the
sustainability of the Project.
(h) A statement of experience. Information on the owners' and
principal employees' relevant work experience that would ensure the
success of the Project. The applicant must provide a written narrative
describing its demonstrated capability and experience, if any, in
operating a broadband telecommunications system.
(i) Evidence of legal authority and existence. The applicant must
provide evidence of its legal existence and authority to enter into a
grant agreement with the Agency and to perform the activities proposed
under the grant application.
(j) Funding commitment from other sources. If the Project requires
additional funding from other sources in addition to the Agency's
grant, the applicant must provide evidence that funding agreements have
been obtained to ensure completion of the Project.
(k) Compliance with other federal statutes. The applicant must
provide evidence of compliance with other federal statutes and
regulations, including, but not limited to the following:
(1) 7 CFR part 15, subpart A--Nondiscrimination in Federally
Assisted Programs of the Department of Agriculture--Effectuation of
Title VI of the Civil Rights Act of 1964.
(2) 7 CFR part 3015--Uniform Federal Assistance Regulations.
(3) 7 CFR part 3017--Governmentwide Debarment and Suspension (Non-
procurement).
(4) 7 CFR part 3018--New Restrictions on Lobbying.
(5) 7 CFR part 3021--Governmentwide Requirements for Drug-Free
Workplace (Financial Assistance).
(6) Certification regarding Architectural Barriers.
(7) Certification regarding Flood Hazard Precautions.
(8) An environmental report, in accordance with 7 CFR 1794.
(9) Certification that grant funds will not be used to duplicate
lines, facilities, or systems providing Broadband Transmission Service.
(10) Federal Obligation Certification on Delinquent Debt.
Sec. 1739.16 Review of grant applications.
(a) All applications for grants must be delivered to the Agency at
the address and by the date specified in the NOFA (see Sec. 1739.2) to
be eligible for funding. The Agency will review each application for
conformance with the provisions of this part. The Agency may contact
the applicant for additional information or clarification.
(b) Incomplete applications as of the deadline for submission will
not be considered. If an application is determined to be incomplete,
the applicant will be notified in writing and the application will be
returned with no further action.
(c) Applications conforming with this part will then be evaluated
competitively by a panel of the Agency's employees selected by the
Administrator of the Agency, and will be awarded points as described in
the scoring criteria in Sec. 1739.17. Applications will be ranked and
grants awarded in rank order until all grant funds are expended.
(d) Regardless of the score an application receives, if the Agency
determines that the Project is technically or financially infeasible,
the Agency will notify the applicant, in writing, and the application
will be returned with no further action.
[[Page 43136]]
Sec. 1739.17 Scoring of applications.
(a) All eligible applications will receive points for the following
scoring criteria:
(1) The rurality of the Project (up to 40 points);
(2) The economic need of the Project's Service Area (up to 30
points); and
(3) The ``community-oriented connectivity'' benefits derived from
the proposed service (up to 30 points).
(b) Scoring criteria:
(1) The rurality of the project--up to 40 points.
(i) This criterion will be used to evaluate the rurality of the
Community served by the Project, in accordance with the following
method of scoring. If a Community is identified in the latest decennial
Census, the applicant must use the Census information. If a Community
is not identified in the Census but is identified in the latest edition
of the Rand McNally Atlas, the applicant will use the Rand McNally
Atlas information. Rurality shall be determined by the following
criteria:
(A) The 2000 population data contained in the U.S. Bureau of the
Census at http://factfinder.census.gov: or
(B) The population data contained in the latest edition of the Rand
McNally Atlas. If no population data is contained in the Rand McNally
Atlas for a community that is recognized in the Atlas, then that
community is not eligible for a grant.
(ii) The following categories are used in the evaluation of
rurality:
(A) Level 1 means any Community having a population of less than
500 inhabitants.
(B) Level 2 means any Community having a population of at least 500
and not in excess of 1,000 inhabitants.
(C) Level 3 means any Community having a population over 1,000 and
not in excess of 2,000 inhabitants.
(D) Level 4 means any Community having a population over 2,000 and
not in excess of 3,000 inhabitants.
(E) Level 5 means any Community having a population over 3,000 and
not in excess of 4,000 inhabitants.
(F) Level 6 means any Community having a population over 4,000 and
not in excess of 5,000 inhabitants.
(G) Level 7 means any Community having a population over 5,000 and
not in excess of 10,000 inhabitants.
(H) Level 8 means any Community having a population over 10,000 and
not in excess of 20,000 inhabitants.
(iii) Each application will receive points based on the location of
the facilities financed using the definitions in paragraphs (b)(1)(i)
and (b)(1)(ii) of this section.
(A) For a Service Area that includes a Level 1 Community, it will
receive 40 points.
(B) For a Service Area that includes a Level 2 Community, it will
receive 35 points.
(C) For a Service Area that includes a Level 3 Community, it will
receive 30 points.
(D) For a Service Area that includes a Level 4 Community, it will
receive 25 points.
(E) For a Service Area that includes a Level 5 Community, it will
receive 20 points.
(F) For a Service Area that includes a Level 6 Community, it will
receive 15 points.
(G) For a Service Area that includes a Level 7 Community, it will
receive 10 points.
(H) For a Service Area that includes a Level 8 Community, it will
receive 5 points.
(2) The economic need of the Project Service Area--up to 30 points.
This criterion will be used to evaluate the economic need of the
Service Area. Applicants must utilize the median household income (MHI)
for the Community serviced and the state in which the Community is
located, as determined by the U.S. Bureau of the Census at http://factfinder.census.gov.
If the community was qualified using the Rand
McNally Atlas, the applicant must use the MHI, contained in the
decennial census, of the county in which the Community resides as the
Community MHI. Applicants will be awarded points as outlined below for
service provided in the Community where the MHI is less than 75 percent
of the state MHI:
(i) MHI is 75 percent or greater of state MHI; 0 points;
(ii) MHI is less than 75 percent and greater than or equal to 70
percent of state MHI; 5 points;
(iii) MHI is less than 70 percent and greater than or equal to 65
percent of state MHI; 10 points;
(iv) MHI is less than 65 percent and greater than or equal to 60
percent of the state MHI; 15 points;
(v) MHI is less than 60 percent and greater than or equal to 55
percent of the state MHI; 20 points;
(vi) MHI is less than 55 percent and greater than or equal to 50
percent of the state MHI; 25 points;
(vii) MHI is less than 50 percent of the state MHI; 30 points;
(3) The ``community-oriented connectivity'' benefits derived from
the proposed service--up to 30 points.
(i) This criterion will be used to score applications based on the
documentation in support of the need for services, benefits derived
from the services proposed by the Project, and local community
involvement in planning and implementation of the Project. Applicants
may receive up to 30 points for documenting the need for services and
benefits derived from service as explained in this section.
(ii) The Agency will consider:
(A) The extent of the applicant's documentation explaining the
economic, education, health care, and public safety issues facing the
community and the applicant's proposed plan to address these challenges
on a community-wide basis;
(B) The extent of the Project's planning, development, and support
by local residents, institutions, and community facilities will be
considered. This includes evidence of community-wide involvement, as
exemplified in community meetings, public forums, and surveys. In
addition, applicants should provide evidence of local residents'
participation in the Project planning and development;
(C) The extent to which the Community Center will be used for
instructional purposes including Internet usage, Web-based curricula,
and Web page development; and
(D) Web-based community resources enabled or provided by the
applicant, such as community bulletin boards, directories, and public
web-hosting.
Sec. 1739.18 Grant documents.
The terms and conditions of grants shall be set forth in grant
documents prepared by the Agency. The documents shall require the
applicant to own all equipment and facilities financed by the grant.
Among other matters, the Agency may prescribe conditions to the advance
of funds that address concerns regarding the Project feasibility and
sustainability. The Agency may also prescribe terms and conditions
applicable to the construction and operation of the Project and the
delivery of Broadband Transmission Service to Rural Areas, as well as
other terms and conditions applicable to the individual Project.
Sec. 1739.19 Reporting and oversight requirements.
(a) A project performance activity report will be required of all
recipients on an annual basis until the Project is complete and the
funds are expended by the applicant. Recipients are to submit an
original and one copy of all project performance reports, including,
but not limited to, the following:
(1) A comparison of actual accomplishments to the objectives
established for that period;
(2) A description of any problems, delays, or adverse conditions
which
[[Page 43137]]
have occurred, or are anticipated, and which may affect the attainment
of overall Project objectives, prevent the meeting of time schedules or
objectives, or preclude the attainment of particular Project work
elements during established time periods. This disclosure shall be
accompanied by a statement of the action taken or planned to resolve
the situation; and
(3) Objectives and timetable established for the next reporting
period.
(b) A final project performance report must be provided by the
recipient. It must provide an evaluation of the success of the Project
in meeting the objectives of the program. The final report may serve as
the last annual report.
(c) The Agency will monitor recipients, as it determines necessary,
to assure that Projects are completed in accordance with the approved
scope of work and that the grant is expended for Eligible Grant
Purposes.
(d) Recipients shall diligently monitor performance to ensure that
time schedules are being met, projected work within designated time
periods is being accomplished, and other performance objectives are
being achieved.
Sec. 1739.20 Audit requirements.
A grant recipient shall provide the Agency with an audit for each
year, beginning with the year in which a portion of the financial
assistance is expended, in accordance with the following:
(a) If the recipient is a for-profit entity, an existing
Telecommunications or Electric Borrower with the Agency, or any other
entity not covered by the following paragraph, the recipient shall
provide an independent audit report in accordance with 7 CFR part 1773,
``Policy on Audits of the Agency's Borrowers.''
(b) If the recipient is a State or local government, or non-profit
organization, the recipient shall provide an audit in accordance with 7
CFR part 3052, ``Audits of States, Local Governments, and Non-Profit
Organizations.''
Sec. 1739.21 OMB Control Number.
The information collection requirements in this part are approved
by the Office of Management and Budget (OMB) and assigned OMB control
number 0572-0127.
Subpart B--[Reserved]
Dated: July 19, 2007.
James M. Andrew,
Administrator, Rural Utilities Service.
[FR Doc. E7-15106 Filed 8-2-07; 8:45 am]
BILLING CODE 3410-15-P