By Dolores Adolph, 3M Communication Markets Div., Austin, TX
It sounds reasonable to assume that the U.S. ranks among the world’s leaders in broadband Internet access. But actually, as a country, we rank 15th in the world for broadband subscribers per capita, according to the Organization for Economic Cooperation and Development.
While many Americans can’t imagine living without high-speed Internet, some inner-city neighborhoods, small towns and rambling swaths of rural America still lack access to reliable broadband service. That’s why the American Recovery and Reinvestment Act of 2009, signed into law last February, earmarked stimulus funds to expand broadband Internet infrastructure and access across the country.
The Recovery Act allocated $7.2 billion to fund projects that will bring the country up to speed on broadband service. The money is being channeled through the National Telecommunications and Information and Administration (NTIA) and the U.S. Department of Agriculture’s Rural Utilities Service (RUS). The federal government is currently dispersing grants and loans to successful applicants who applied during the first round of funding. However, telecommunication providers have one more chance to apply for stimulus money, during a second round of funding. As of press time, the Notice of Funds Availability along with the application deadline for round two had not yet been announced (the notice is expected in January 2010), but the awarding of all funds is scheduled to be completed by September 2010.
The funding can be used for capital costs directly related to deploying broadband infrastructure as well as hiring, training and employing staff. Additionally, un-specified costs and collateral equipment may be approved for funding on a case-by-case basis. For instance, diagnostic test equipment would fall under the case-by-case review process. Government officials have indicated to 3M that the company’s Dynatel brand diagnostic test equipment and locating and marking products might be eligible.
Any for-profit company may apply for funds. Municipal and Native American tribal governments, universities and school districts are also eligible. For instance, the Coeur d’Alene Tribe in Idaho applied for $12 million in stimulus funds to deploy a fiber optic network to connect 3,500 homes on its rural reservation. The city of Philadelphia asked for $22 million to connect police and fire stations, libraries, housing complexes and community centers in three inner-city neighborhoods with a combination of fiber and wireless networks. And Clearwire Corp. requested $19.4 million to build a high-speed wireless network in some poor Detroit neighborhoods.
To find out how and when to apply for round-two funding, visit www.broadbandusa.gov. The web site contains program notices, fact sheets, FAQs, funding applications and workshop announcements, among other helpful information.
BIP and BTOP
The $7.2 billion in Recovery Act funding for broadband is split between the RUS and the NTIA.
RUS is distributing $2.5 billion in grants and loans to facilitate broadband deployment it rural areas, many of which are served by small, independent telcos. Those funds are being distributed through the RUS’s Broadband Initiatives Program (BIP).
The NTIA is doling out $4.7 billion in grants through its Broadband Technology Opportunities Program (BTOP). BTOP grants fund projects that deploy broadband infrastructure in un-served and under-served areas, expand public computer center capacity and encourage sustainable adoption of broadband service.
The BIP program focuses on rural and remote areas. It provides loans and grant/loan combinations for projects that that expand broadband in rural communities. While the Recovery Act allocates $2.5 billion to the RUS for broadband projects, the agency has dedicated some of its existing funds, for a total of about $9 billion, to expand broadband in rural areas.
BIP requires that a project cover an area that is at least 75 percent rural and “lacks sufficient access to high-speed broadband service.” The BIP program favors projects that spur job creation and economic growth beyond the immediate construction and operations of broadband facilities.
Additionally, the law mandates that priority be given to projects that give end users a choice of providers; that serve a high proportion of rural residents that currently lack broadband service; are proposed by current to former RUS borrowers; and are fully funded (once the BIP loan or grant has been awarded) and ready to break ground.
BTOP provides grants to support deployment of broadband infrastructure in “unserved” and “underserved” areas, to enhance broadband capacity at community computer centers, and to encourage the sustainable adoption of broadband through education and training. The program’s $4.7 billion in stimulus funds are also dedicated to job creation and long-term economic growth.
BTOP has made funds available for public computer centers and for what it calls “sustainable broadband adoption” – projects that promote broadband demand, such as education, awareness, training, access equipment and support, especially among “vulnerable” populations. But the bulk of BTOP funds are earmarked for infrastructure projects that deliver broadband service through Last Mile or Middle Miles facilities to unserved and underserved areas.
For Last Mile projects, an unserved area is defined as an area where 90 percent or more of the households do not have access to facilities-based, terrestrial broadband service. (Satellite service availability is not considered broadband access.) An underserved area is defined as a service area where 50 percent or less of the households have access to broadband service at a greater than the minimum broadband speed; or, 40 percent or less subscribe to broadband service; or, no service provider advertises broadband speed of at least 3 Mbps downstream in the proposed service area. A service area can include well-served neighborhoods as long as the project area as a whole meets the definition of unserved or underserved.
For Middle Mile proposals, projects where one interconnection point terminates in an unserved or underserved area qualify for BTOP funding.
Applicants are advised to use state broadband mapping data, if available, to determine if their project area is unserved or underserved. If state data is not available, market surveys, statistical sampling or other valid methodology may be used.
Stimulating Success
For round one of funding, the government received 2,200 applications requesting a total of $28 billion, seven times the amount that was available for awards. For round two, it’s reasonable to expect that as many or more applicant will vie for the remaining $3.2 billion. To be successful, applicants must make their proposals stand out. Here are some tips on how to make the most of your application:
- BIP and BTOP encourage collaboration, so consider a joint venture. Companies can partner with other companies and small businesses, or with local and tribal governments, school districts and even hospitals. (One entity must serve as the lead applicant.)
- Some applicants are breaking down large projects into several smaller ones and applying for funds separately – one 3M customer has submitted 32 individual funding applications. This strategy may increase the odds that at least part of your project will be awarded stimulus funds.
- The Recovery Act focuses on job creation, so the more long-term employees your project calls for, the better your application will look in the eyes of government reviewers.
- Applicants may apply for both BIP and BTOP funding, but will only receive an award from one program. BIP gives preference to projects requesting a higher amount of loan funds compared to grants
- Consistent with the goals of the Recovery Act, BIP and BTOP funds are intended to foster immediate access to broadband service. Therefore, “shovel ready” project are preferred. However, in order to encourage cost-effective deployment, stimulus funds can be used for inactivated, or “dark,” fiber, as long as the additional capacity is not considered excessive.
- Purchases made with BIP and BTOP funds are subject to the Buy American requirement. However, the Secretary of Commerce has waived the provision for some broadband equipment. Go to the U.S. Department of Commerce Web site and search “Buy American waiver” to see the full text of the waiver, issued on June 19.
- If your project wasn’t chosen for round-one funding, you may try again during round two.
- Dot your I’s and cross your T’s. A complete and thorough application will help ensure that it is given full consideration. See www.broadbandusa.gov for all you need to know on the application process.
- Keep in mind that BIP and BTOP funding requires a transparent process. All applications are public records.