Thanks to Connect Minnesota for the update. It’s great to see that the FCC is moving forward to fund good ideas to expand broadband in rural America. As you may recall – Minnesota submitted a lot of good ideas. Hopefully folk are ready to go with an application. Between this and the Minnesota Broadband Fund, we could see another burst of communities get up to speeds in the next couple of years. Every exciting!
Applicants for both funds will just want to be clear about the ramifications of pursuing funding for both. According to the webinar on the Minnesota funds last week, the State is happy to support projects that the federal government is also funding. The feds may feel differently.
FCC Announces Budget and Application Window for Rural Broadband Experiments A Connected Nation Policy Brief July 11, 2014
At an Open Commission Meeting on July 11, 2014, the Federal Communications Commission (FCC) voted to approve a budget and open an application window for Rural Broadband Experiments through the Connect America Fund program. Formal applications will be due 90 days after the release of the official Order, which is expected shortly. Later this year, the FCC will analyze formal applications and will select winners through a competitive auction, with the goal being to award the funds to the most cost-effective proposals to offer broadband service in rural areas of the country that do not have adequate access to broadband today.
As noted in an earlier Connected Nation Policy Brief, in January 2014 the FCC established the Rural Broadband Experiments program with the purpose of shaping and adjusting its Connect America Fund broadband subsidy program to include an application-based, competitive-bidding framework. The formal process launched today will make available funds from earlier phases of the Connect America Fund. The Rural Broadband Experiments program is the first opportunity for providers that are not the incumbent local telephone company in a particular area to receive Connect America Fund subsidies to build and operate fixed broadband networks. This “experiment” will serve as a test to the competitive bidding process the FCC will plan on using to distribute more Connect America Funds in 2015 and beyond.
The FCC’s January action requested that providers and communities interested in the program file “expressions of interest” by March 7, 2014, and over one thousand “expressions of interest” were filed from a variety of applicants including current providers, electric cooperatives, communities, and organizations. The FCC used these expressions of interest in devising the formal rules and nature of the project announced today as well as the broadband service standards and expectations for recipients.
According to the FCC News Release, the FCC will divide the $100 million budget for the program into three buckets: 1. $75 million will be awarded to projects that will offer broadband service to residential and small business consumers at speeds of at least 25 Mbps download/5 Mbps upload speed. 2. $15 million will be awarded for projects that will offer broadband service at speeds of at least 10 Mbps download/1 Mbps upload. 3. $10 million will be awarded to projects that will serve “extremely high cost areas” at speeds of at least 10 Mbps download/1 Mbps upload. (The FCC has identified “extremely high cost areas” generally to be those in which a monthly subsidy of a at least approximately $2,400 in subsidy per unserved location per year.)
Formal applications will be due 90 days after release of the complete text of the FCC’s action. The Order will specify service standards for applicants and will establish a cap on project size per application.
After applications are received, the FCC will conduct a single-round, competitive auction to identify applications within each of these buckets to receive subsidies. The auction will be nationwide – for example, proposals to fund a network project in Tennessee will be competing on a per-location subsidy cost against network projects in Minnesota. The FCC will give a 25% bidding credit to projects that propose to serve Tribal lands.
In addition to the program launched today, the FCC also launched another proceeding that will consider rules for a broader, Connect America Fund Phase II competitive bidding process. The Rural Broadband Experiments program is designed to help the FCC and industry gather information on how to distribute Connect America Fund subsidies through a competitive mechanism. Phase II of the Connect America Fund is a $1.75 billion/year program targeted at the unserved areas of larger local telephone companies, such as CenturyLink, Windstream, AT&T, and Verizon. In allocating those subsidies, the FCC today proposed to offer bidding credits or incentives to applicants for those Phase II projects that include partnerships and funding from state governments and other non-Federal sources.
Dozens of communities and providers have expressed interest in this program, and Connected Nation has actively supported these initiatives and stands ready to assist our stakeholders with this process, provide information and data, and answer questions. When the Order text is released, Connected Nation will provide stakeholders information on the further details of the project (including specific application requirements and timing).
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For more information on Rural Broadband Experiments or for assistance with applications and mapping needs, please contact Connected Nation at policy@connectednation.org.