TR Daily USDA Outlines Allocation Plans for $600M e-Connectivity Pilot
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Thursday, December 13, 2018

USDA Outlines Allocation Plans for $600M e-Connectivity Pilot

The U.S. Department of Agriculture announced today that it will allocate the $600 million Congress appropriated in March for an e-Connectivity broadband pilot program — now dubbed the ReConnect Program —in three equal buckets of $200 million each for grant-only support, combined grant and loan support, and loan-only support.

Recipients of high-cost support through the FCC’s Connect America Fund will be eligible for loan-only support, and in areas where a provider is receiving CAF support, only the CAF recipient will be eligible for e-Connectivity support, ensuring the pilot program does not fund overbuilds, Chad Parker, assistant administrator–telecom for USDA’s Rural Utilities Service.

Funded projects will have to deploy broadband service at speeds of at least 25 megabits per second upstream and 3 Mbps download to communities with fewer than 20,000 people, USDA said in a press release. “Priority will be awarded for projects that propose to deliver higher-capacity connections to rural homes, businesses and farms. USDA seeks to stretch these funds as far as possible by leveraging existing networks and systems without overbuilding existing services greater than 10/1 [Mbps],” it added.

“Our goal as public policymakers is to connect America rather than divide America,” Agriculture Secretary Sonny Perdue said at an event this afternoon unveiling plans for how and when the department will award the $600 million. “We don’t want an urban-rural divide in this country. We can’t afford that,” he added.

Secretary Perdue said that his goal is to have the pilot program “complement and inform the additional opportunities” in the 2018 farm bill (HR 2) passed by Congress this week (TR Daily, Dec. 12), which includes $50 million annually for the next five years for the Community Connect Grant Program. Traditionally, most RUS telecom funding has been through loans.

Explaining the details of the program, Mr. Parker said that the grant-only support will require a 25% matching contribution, and that applications will be due April 29. Applications for mixed grant-loan support will be due May 29, he said. And support that consists solely of loans at 2% interest will be distributed first-come, first-serve, with an application deadline of June 28, he added.

Factors for weighing competing applications for funding that includes grant support will include how many “agricultural production and marketing, e-commerce, healthcare, and education facilities” will gain high-speed connections.

Mr. Parker said that USDA plans to hold workshops and webinars to provide guidance to prospective applicants about the information and documentation that their applications should contain. A list of upcoming workshops and webinars can be found at reconnect.usda.gov.

Responding to the announcement, Sen. Shelley Moore Capito (R., W.Va.) said, “Without access to reliable and affordable high-speed internet, rural communities and rural states like West Virginia are being left behind when it comes to education, health care, job creation and retention, and overall economic potential. Programs like this one and other efforts I’ve been working to promote through my Capito Connect initiative can help us close the digital divide, improve the lives of those living in our rural communities, and grow and diversify our economy. That’s exactly why I worked hard to ensure funding for the ReConnect Program was included in the FY2018 funding agreement and will continue to push for similar resources.”

Sen. Capito, like other senators who had planned to attend the announcement, was unable to do so because floor votes were scheduled. Secretary Perdue noted the presence of House members during his remarks, but none of the lawmakers took the podium.

Sen. Jeff Merkley (D., Ore.), the ranking minority member of the Senate Appropriations Committee’s subcommittee on Agriculture and rural development, said, “In today’s connected world, we need high-speed broadband in every rural community across Oregon and across America. Everyone needs it; rural health care providers, businesses, schools, small businesses, and farmers and ranchers. Oregonians in some of the most remote parts of my state said that high-speed internet would be a game-changer for them, and so I used my position to fight for a massive increase in rural broadband. I am pleased that in addition to important traditional agriculture programs, we are investing in the future of our rural communities.”

David J. Redl, the head of the National Telecommunications and Information Administration, said, “The administration is taking an important step to help close the broadband coverage gap for the millions of rural Americans who lack access to broadband connectivity with the launch of the U.S. Department of Agriculture’s $600 million grant and loan program. NTIA looks forward to providing technical assistance to potential applicants through its partnership with USDA’s Rural Utilities Service (RUS). NTIA’s BroadbandUSA team has extensive experience working in the telecommunications industry, building broadband networks and consulting with service providers and local governments. Using this expertise, our team will be supporting educational materials and workshops to help applicants with the grant and loan process.”

Nearly 10 years ago, NTIA and RUS shared the duty of distributing $7.3 billion in funding allocated by the 2009 American Recovery and Reinvestment Act for the purpose of boosting broadband deployment and use.

NTCA Chief Executive Officer Shirley Bloomfield said, “NTCA has been grateful for the opportunity to collaborate with a diverse group of public and private stakeholders in the lead up to today’s exciting announcement. We all recognize the value of and fundamental need for robust, sustainable broadband in rural America — technology that supports health care, education, economic development and more — and we hope this program can be a critical component of delivering on that value and responding to that need.”

National Rural Electric Cooperative Association Chief Executive Officer Jim Matheson welcomed USDA’s announcement, saying, “Secretary Perdue’s announcement lays the groundwork for an improved approach to making broadband a reality across rural America. This pilot program, and the strong broadband provisions included in the 2018 Farm Bill, highlight a much-needed shift in federal policy to make rural broadband a possibility for the estimated 23 million Americans who lack it.”

NRECA said that it is “very pleased that the pilot program adopts a 25/3 sufficiency standard and will prioritize applications that would deliver speeds in excess of the 25/3 minimum standard.”

Richard Cullen, executive director of Connect Americans Now, a coalition that includes app developer trade group ACT, the Dynamic Spectrum Alliance, and Microsoft Corp., said, “Modern precision agriculture tools allow family farmers to keep up by helping them save time, conserve resources and increase yields. Unfortunately, most of these technological advancements require broadband connectivity — making them unavailable to producers on the wrong side of the digital divide. The ReConnect Program will help reverse this trend by providing crucial resources to local internet service providers, co-ops and other partners working to bring broadband to underserved communities across rural America, and we applaud Secretary Perdue and the USDA’s commitment to this critical issue.”

Mr. Cullen added, “As the ReConnect Program moves forward, we strongly encourage the USDA to consider how to most efficiently use these funds to bring broadband to the highest number of people for the lowest possible cost. Employing a mixed-technology model that utilizes wired and fixed wireless solutions including TV white spaces technology can drastically reduce the cost of deploying connectivity to rural areas, and the USDA would be wise to ensure these funds are used to support this all-of-the-above approach.” —Lynn Stanton, [email protected]

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