11 11, 2021

Webinar: Breaking Down the ReConnect Round 3 Funding Program

2021-11-12T08:29:17-05:00November 11, 2021|Webinar Recordings|

The U.S. Department of Agriculture’s (USDA) Rural Utilities Service (RUS) has announced the application window for Round 3 of its Rural eConnectivity Program (ReConnect), which will provide $1.15 billion in grants, loans, and grant-loan combinations for broadband buildout projects in rural America. This third round of funding will consider areas where 90% of the households lack access to fixed broadband services with speeds of at least 100/20 Mbps. If you did not have qualifying areas for Round 2, you likely will for Round 3 due to this eligibility change. The program requires awardees to provide services with speeds of 100/100 Mbps to all premises in the proposed geographic area(s). RUS will begin accepting applications on November 24, 2021, and all applications must be received by February 22, 2022.

JSI recently hosted a webinar to help those interested in applying for the funds prepare for the 2022 program. Our experts, who have shepherded many companies through the process in Rounds 1 and 2, shared important information and strategies, including:

  • Program requirements and deadlines for grants, loans, and grant/loan combinations, including details on requirements for tribal governments and socially vulnerable communities
  • Differences between Round 3 and previous competitions
  • How to determine eligible areas and whether to apply
  • Details on RUS’s scoring criteria
  • Strategies for success based on JSI’s work with past ReConnect winners

Because of the program’s complexity and the funding options available, this webinar also will feature scenarios for each of the funding options: 100% loan, 50% loan 50% grant combinations, 100% grant, and 100% grant for tribal governments and socially vulnerable communities.

JSI-assisted applicants have been very successful in previous ReConnect competitions, with 93% of Round 2 applicants awarded funding through the program. We are ready to work with you on all aspects of a ReConnect application and broadband project.

For a copy of the webinar recording, please contact Brenda Cordwell at 240-556-1295. For more information about the ReConnect program or to get started on an application, please contact Lans Chase at 770-569-2105 or Amanda Molina at 321-985-5709.

30 04, 2021

Begin Prepping Now for ReConnect Round 3 Competition

2021-11-02T13:13:19-04:00April 30, 2021|e-Lerts|

We expect to see the Rural Utilities Service (RUS) announce the third competition soon for grants and loans under the U.S. Department of Agriculture’s (USDA) Rural eConnectivity Pilot Program (ReConnect). RUS could open the competition any time. RUS recently requested comments on rule and criteria changes and that comment period ended earlier this week. The standard application window has been six weeks. And unlike the recent RDOF reverse auction, ReConnect funds network construction based on the budget you provide.

Six weeks does not leave much time for identifying qualified areas, completing financials, and preparing applications. Starting some of that work now will allow you to target the best areas for your application, start a build-out budget, and collect the required documentation to develop a competitive application once the final grant rules are announced. Much of this prep work also will be applicable to other grant programs, such as special COVID-19 related programs and state grants. For example, all applications require a System for Award Management (SAM) registration to do business with a government agency, including RUS. The SAM registration provides companies with a Commercial and Government Entity Code (known as a CAGE code). These CAGE codes sometimes take several weeks for companies to obtain.

Leverage JSI’s Success and Expertise
JSI can help broadband providers with all aspects involved with completing applications. Our clients have had tremendous success in the first two rounds of ReConnect. During ReConnect Round 2 in 2020, 93% of the providers we worked with on their applications were awarded grants and loans.

Even before the competition begins, our experts can map potentially eligible unserved and underserved communities so that you target the right areas. These maps can show you competitors and their speed coverage; existing mechanisms funding the area (grants/loans, RDOF funding, RUS borrowers, etc.); and the number of locations. The maps should guide you to your target areas and can easily be fine-tuned based on the program’s final criteria. JSI also can begin the financial modeling and engineering required for an accurate network construction budget.

What to Expect in Round 3
Although the Round 3 competition has not yet been announced, RUS did publish ReConnect rules in the Federal Register, which became effective April 27, 2021. The rules allow for the Funding Opportunity Announcement (FOA) to be shorter and relevant to only the subset of data that can change with each funding year. Expect to also see the following for ReConnect Round 3 once the competition is announced:

  • A minimum acceptable level of broadband will be released to establish qualifying areas;
  • Future speed requirements for application(s) will be documented;
  • RUS will identify and establish what areas will be protected in the new application windows;
  • Additional section specifications, including scoring criteria, eligible service area threshold, and eligible award costs;
  • Identified interest rates for direct cost-of-money loans and, as applicable, reduced interest rates for 100% loans; and
  • Total funding available by category of grant, grant/loan combination, and 100% loan for Round 3.

If you’d like more information about ReConnect Round 3, or if you’d like to get started on your company’s application, contact Valerie Wimer in JSI’s Maryland office at 301-459-7590 or Lans Chase in our Georgia office at 770-569-2105.

17 12, 2018

USDA Unveils $600M ReConnect Broadband Grant & Loan Program

2018-12-17T10:58:37-05:00December 17, 2018|e-Lerts|

As we informed clients in our August 6 and August 30 e-Lerts, U.S. Department of Agriculture’s (USDA) Rural Utilities Service (RUS) plans to distribute $600 million in grants and loans via a new pilot program for rural broadband in unserved areas lacking access to at least 10/1 Mbps. On December 13, 2018, the USDA announced the program details, including a fact sheet and mapping tool to help interested parties locate eligible areas. USDA has also renamed the program which is now called the Rural eConnectivity Pilot Program or ReConnect.

Below we outline some of the key program rules and, in the coming weeks, we will host a webinar to provide further details about the ReConnect Program. Additionally, JSI is prepared to assist in all phases of the application and funding processes. If you are considering applying for funds, please contact Janee Devis in our Maryland office to be added to our ReConnect distribution list. We will provide you with updates about the program, deadline reminders, and other important information.

What Types of Entities Are Eligible:

All types of profit and not-for-profit entities, including rural telcos, WISPs, electric cooperatives, and community broadband providers, are eligible to apply. ReConnect is not restricted to those with experience in providing communications services, so we expect that the competition for funds could be intense. In addition to commercial enterprises, entities eligible to apply include states, local governments, and “any agency, subdivision, instrumentality, or political subdivision thereof.” Territories and tribal authorities can also apply.

What Options are Available for Funding:

The ReConnect Program will have three category options for funding: grant-only, combination 50% grant and 50% loan, and loan-only. Up to $200 million is allocated to each category, and applicants can only apply in one category. Grant-only awards will only be considered in areas where 100% of the households lack 10/1 Mbps. Areas where there is not availability of 10/1 Mbps broadband to 90-100% of households are eligible for grant/loan and loan-only combinations. All three categories require that a minimum of 25/3 Mbps broadband is deployed.

When Applications Are Due:

Applications for the grant-only awards are due by April 29, 2019. The grant/loan applications are due by May 29, 2019. The loan-only applications are due by June 28, 2019, but will be evaluated and awarded on a first-come-first-serve basis, beginning in March 2019.

What Areas Are Eligible:

Unless one of the following exceptions apply, all rural areas where there is less than 10/1 Mbps broadband are eligible for funding:

  • RUS cannot fund more than one project that serves any one geographic area. If RUS receives qualified applications that contain overlapping service areas, RUS will follow certain procedures to determine how those applications will be processed.
  • Entities that have RUS broadband loans (Telecom Infrastructure, Farm Bill Broadband, BIP loans) can apply for funding in areas where they are not currently delivering at least 10/1 Mbps if they have not defaulted on, and have materially complied with, in the sole discretion of RUS, their prior broadband loan requirements. No other entities can apply in these areas.
    • This means that in rate-of-return study areas where the provider is supported by a previous RUS broadband loan, the rate-of-return provider is the only entity that is eligible to apply for ReConnect funds.
  • Areas that should be served via a Community Connect grantee are eligible if they do not have sufficient broadband access, except for those areas where the grants are still listed as “pending.”
    • Many past Community Connect grants were only funded to 4/1 Mbps, so presumably these areas would be eligible for ReConnect funds. If you were a Community Connect grantee at a lower speed requirement, ReConnect might be a good opportunity.
  • Areas that received a 100% grant under the RUS BIP program are eligible if the BIP grantee is not already delivering at least 10/1 Mbps. However, if the applicant is the same BIP grantee, then the applicant may only request a 100% loan. Areas that have received state funding to deploy broadband at a speed of at least 10/1 Mbps are not eligible. As part of the application process, the applicant must provide a map of the proposed funded service area to the appropriate state government office, and the state government office must certify whether funds have or have not been allotted for the area.
  • In areas awarded to CAF Phase II Auction 903 winners, only the auction winner can apply for ReConnect funding, and the winner can only apply for funds from the loan-only funding category.

Stay tuned for more information from JSI about when we will host our webinar and other developments regarding the ReConnect program. For questions about the ReConnect program, eligibility, and the application process, please contact Cassandra Heyne or John Kuykendall in the Maryland office at 301-459-7590 or Lans Chase in our Georgia office at 770-569-2105.

30 08, 2018

RUS’s e-Connectivity Pilot Program to Distribute $600M for Broadband

2018-08-30T11:57:56-04:00August 30, 2018|e-Lerts|

JSI Will Be Providing Updates and Assistance to Interested Clients

As we informed clients in our August 6 e-Lert, the U.S. Department of Agriculture’s (USDA) Rural Utilities Service (RUS) plans to distribute $600 million in grants and loans via a new program called the “e-Connectivity” pilot program. The rural broadband pilot program was created as part of the Consolidated Appropriations Act of 2018. Funding will be targeted to rural areas where no more than 10% of residents can get 10/1 Mbps broadband. Additionally, any entity receiving funds is prohibited from overbuilding an existing RUS borrower (but can build in its own ILEC study area even if it is an RUS borrower).

RUS has begun the process of drafting rules and procedures for the funding by requesting comments in a Notice of Inquiry (NOI). Comments are due Monday, Sept. 10, 2018, by 5:00 p.m. Eastern. Although RUS is in the early stages of developing the program, we encourage clients to stay informed throughout the proceeding and file comments in matters that could impact your company’s ability to receive money from the program. Participating in advocacy efforts at this early stage is key to ensuring that the needs of your company for funding in areas lacking 10/1 are considered as the rules are being crafted.

With this in mind, JSI will be providing interested clients with updates as developments occur, including items on which comment is sought, as well as assisting companies in drafting and filing comments. After the rules and procedures have been published, JSI will assist in all phases of the application and funding processes.

Below is our first update which provides information based on our research and conversations with RUS staff and a summary of comments being sought in the NOI. If you are interested in receiving future updates on the e-Connectivity pilot program, please send an email to Janee Devis and we will add you to our distribution list.

Applicability of e-Connectivity Pilot Program to Rural Broadband Providers

The e-Connectivity pilot program has the potential to provide a much-needed influx of funding to targeted, unserved or underserved areas. In other RUS loan and grant programs, the applicant can create its own funded area that does not necessarily have to match a study area boundary – if used in the pilot program, this should encourage rate-of-return carriers (RLECs) and their affiliates to seek grants or loans in pockets of unserved areas with poor business cases. In other RUS grants, such as Community Connect, applicants draw their own funding area boundaries which are confirmed as unfunded and eligible for grants by RUS field agents. We expect a similar process to occur with the e-Connectivity pilot program.

From recent trade press, it is our understanding that RUS is considering including some funding from its broadband loan program so that projects could have a mixture of areas lacking 10/1 and 25/3 and funding with a loan-grant package. If RUS takes this approach, the agency anticipates that the amount of available funds could approach $1 billion.

Also, based on conversations with RUS staff, it is our understanding that it is considering allowing A-CAM and Legacy rate-of-return carriers with defined buildout obligations, as well as CAF Phase II auction winners, to receive funding from this program in currently unserved areas where they receive universal service support (USF) that is targeted for broadband deployment. If such an approach is adopted when the final rules are written, the pilot program would provide much-needed supplemental funding in areas where either A-CAM or CAF-BLS doesn’t cover the real costs of deploying broadband in remote areas. Regarding CAF Phase II auction winners, we have been informed that RUS is considering allowing winners to apply for funding to close the gap between the amount of their winning bid and the initial “reserve price” of the winning census block groups, assuming that the winning bid was significantly less than the reserve price.

Regardless of whether or not RUS allows funding in areas where carriers receive targeted USF, RLECs with any areas less than 10/1 within their service territories should consider participating in the pilot program. For example, RLECs that were ineligible for A-CAM support because the company had deployed broadband to at least 90 percent of the study area could use the funds to build out to what may be the most costly locations at the edges of a study area by applying for funding in just those unserved areas. Carriers electing A-CAM that had support reduced due to inadvertent clerical errors or erroneous Form 477 data filed by a competitor could also benefit by participating in the program. RUS funding also could help RLECs competitively extend services outside their study areas and facilitate new opportunities for growth and economic development. There are many possibilities, and we encourage clients to file comments if they are sought on which areas should be eligible for funding. FCC Commissioner O’Rielly and members of Congress are pushing against awarding grants in areas that already receive any USF.

As noted above, JSI will be providing future updates on the e-Connectivity pilot program to interested clients as developments occur. We are available to assist with drafting comments and evaluating opportunities once more information is released, and down the road we will help clients review and understand the application guidelines and complete their applications. For questions about the e-Connectivity pilot program, contact Cassandra Heyne or John Kuykendall in JSI’s Maryland office at 301-459-7590.

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