Tag Archives: usda

Second round of RUS broadband subsidies opens, as California waits for something – anything – from the first round

by Steve Blum • , , , ,

Usda eligibility map 31jan2020

Correction: The yellow blobs on the map above are not pending ReConnect grants, they are pending rural telco applications, which are also administered by RUS. So California is still a great big zero for ReConnect grants and/or loans. Thank you to a Gentle Reader for gently pointing that out. The text below has been updated accordingly.

The federal agriculture department’s Rural Utilities Service began accepting applications on Friday for $600 million in broadband infrastructure subsidies, via its ReConnect program. The money is split three ways – $200 million each for grants, loans and grant/loan combinations. To be eligible, a community (or any geographic area, large or small) has to 1. lack broadband service at a minimum of 10 Mbps download and 1 Mbps upload speeds, and 2. be rural, as the term is defined by the federal government. Subsidised infrastructure has to be capable of delivering at least 25 Mbps down/3 Mbps up speeds.

Those speed benchmarks are below the ones adopted on Thursday by the Federal Communications Commission. The FCC’s Rural Digital Opportunity Fund program sets 25 down/3 up as the threshold for subsidy eligibility, and offers significant incentives for building infrastructure that supports service above that level, all the way up to gigabit class speeds.

Applications for the first round of ReConnect grants and loans, submitted last year, are still being evaluated. There are a couple of rural telephone companies with pending applications from another RUS program in California – Sierra Telephone, east of Merced and Ponderosa Telephone, north and east of Fresno, both in the Sierra. Ponderosa is also applying for an area in eastern San Bernardino County, along the Nevada border.

But so far, the ReConnect program hasn’t done anything for California. The federal agriculture department has been sending out press releases trumpeting broadband subsidies awarded in other states, but no mention of California. A spokesman for the department said that none are imminent.

Part of the reason is the way the federal government defines “rural”. The definition is largely based on proximity to population centers, of a size – 20,000 to 50,000 people – that would be a major city in, say, Kansas but a smallish town in rural California. That problem is compounded by the crude way the federal agriculture department cuts and maps eligibility data – both broadband availability and population clusters.

Half a gigabuck offered for federal rural broadband subsidies, but California faces challenges

by Steve Blum • , , , ,

Rus reconnect eligibility map yolo 12dec2019

Another round of broadband infrastructure subsidies is on the way from the federal agriculture department. A six week application window for the Rural Utilities Service’s (RUS) Reconnect program opens on 31 January 2020, with $512 million on the table.

It appears that the problems with the ReConnect program that shut California out of the first round of grants and loans earlier this year haven’t been fixed. On the face of it, the basic eligibility criteria are pretty simple…

90 percent of the proposed funded service area must not have sufficient access to broadband. Applicants must propose to build a network that is capable of providing service to every premise located in the proposed funded service area at the time the application is submitted at a speed of 25 Mbps downstream and 3 Mbps upstream.

So what is “sufficient”?

Sufficient access to broadband means any rural area in which household have fixed, terrestrial broadband service delivering at least 10 Mbps downstream and 1 Mbps upstream. Mobile and satellite services will not be considered in making the determination of sufficient access to broadband.

So far, so good. All you need to do is document a lack of broadband service at 10 Mbps download and 1 Mbps upload speeds and the money is yours, right?

Wrong.

Although it’s not required by the rules – new or old – RUS publishes data showing what’s eligible and what’s not, and that’s that. There’s no established process for making your own eligibility case, or to point out the demographic, geographic and economic differences between California and, say, Kansas or Alabama. In the past, RUS’s mapping has been crude. This time around, they’ve published a new data set. I haven’t crunched it yet, so I can’t say whether or not it’s an improvement, but a quick look at their map – an example is above – shows that big chunks of rural California are still considered off limits.

Even so, the devil will be in the details. Stay tuned.

Experience and expertise give ISPs an edge in hunt for federal rural broadband subsidies

by Steve Blum • , , , ,

Salinas ag tech summit 13jul2018

The federal agriculture department’s ReConnect program is new. It supplements an older program that wasn’t much use in California. We’re hopeful this new version will be better for us. But we won’t know until we see results. Grant money will be awarded on a competitive basis, with the first grant application deadline last month, and windows for grant/loan combinations and pure loans coming up.

On paper, it’s easier for Californian projects to qualify – e.g. projects submitted by private, for profit ISPs, which we have, as opposed to co-ops and similar, which we don’t so much. USDA grant applications are different from what we’re used to with California Advanced Services Fund (CASF) grants. The application requirements tend to be more technical, and the review more objective.

Sometimes that’s good, sometimes not.

When an Internet service provider asks me if they should apply, I have three gating questions:

  • Do you have GAAP compliant financial statements? Not can you put them together if you had to, but could you give those to me right now if I asked?
  • Do you have someone in your organisation with a four-year engineering degree?
  • Have you applied for a federal telecoms grant in the past?

If the answer to all three questions is no, then you’re going to have a harder time meeting the application requirements. The USDA isn’t big on do-overs. They run applications through an initial screening – which is partly automated – and kick out the ones that aren’t up to spec in their judgement.

So the companies and other organisations that have been successful in the past have been the ones that submit financial and technical detail that complies with USDA’s standards. Qualified accountants and engineers have a significant edge. Some organisations have people who perform at that level without the qualifications, but that’s not the way to bet.

Experience also matters. The ones who win grants tend to be the ones who have learned to play the game. The odds of success on your first go-round are lower, but once you climb the learning curve, your chances increase. If you’re looking at this as a one-off opportunity, I wouldn’t be optimistic. But if you look at it as something that you’ll develop as part of your business model for the long term, then I think it’s worth the effort.

Trump’s budget plan puts broadband funding, mapping on table

by Steve Blum • , , , ,

Broadband gets several call outs in the proposed budget released yesterday by the Trump administration. One initiative is endorsed for another year, two are re-promised and one appears to be a response to widespread criticism. Line item figures haven’t been published yet, but even just the overview runs to 150 pages. Details on plans are scarce, but the broadband snippets that were included tell an encouraging tale.

Agriculture secretary Sonny Perdue has bucked the administration’s love fest with big, incumbent cable and telephone companies and pushed for community-based broadband service, particularly via rural electric coops. His department has also adopted a much friendlier attitude toward independent broadband providers in its ReConnect infrastructure grant program. The administration’s budget summary gives him props for that…

The Budget focuses on core Departmental activities such as agricultural research, rural lending, and protecting the Nation’s forested lands and private agricultural lands, while also supporting the Secretary’s efforts to improve services and expand broadband.

The so-called trillion dollar infrastructure program sets aside $200 billion “for other infrastructure priorities”, with “a portion” of it earmarked to…

Promote visionary projects and technologies that can strengthen our economic competitiveness, including 5G wireless communications, rural broadband, advanced manufacturing, and artificial intelligence.

The plan also promises continued efforts to make better use of wireless spectrum and a fresh look at the much criticised broadband data collection and mapping work carried out by the Federal Communications Commission and the National Telecommunications and Information Administration…

The Budget supports the application of innovative spectrum access techniques, spectrum sharing technologies, and spectrum leasing options to enable smarter and more efficient ways to leverage the Nation’s valuable and finite spectrum resources. As part of the Administration’s commitment to the Heartland, the Budget funds broadband mapping work to support ongoing efforts to increase the availability of affordable, reliable, and modern high-speed internet access in rural and underserved communities.

On the other hand, nothing is said about the federal government’s primary broadband subsidy program, the Connect America Fund. It’s run by the FCC and is directing billions of dollars to incumbents, much of which will be wasted on replacing rural copper networks with low capacity wireless service.

Presidential proposals are little more than openers in congress’ annual budget game. With spending bills constitutionally required to begin in the democrat-controlled house of representatives, it’s a safe assumption that lots of changes will be made as the process proceeds through the summer.

Federal agencies begin to sing the same broadband policy music, according to NTIA report

by Steve Blum • , , , ,

Mormon tabernacle choir

There’s more coherency and cooperation amongst federal broadband development planning and programs, according to a report just released by the National Telecommunications and Information Administration. Once you get past the love letter penned to president Donald Trump by a couple of his cabinet secretaries, it’s a good overview of how at least some parts of the federal bureaucracy are trying to coordinate broadband policy.

The need for better execution is clear. The report notes the gap between urban and rural broadband availability – 2% of urban residents lack access to fixed service at a minimum speed of 25 Mbps down and 3 Mbps up. The divide is even wider when, um, overly optimistic fixed wireless availability claims are factored out.

Most of the agency initiatives mentioned in the report already exist, and focus on streamlining processes for things like getting permits to build fiber routes through federal lands or renting space on federally owned towers. That’s all useful, and it’s good to know that, little by little, federal agencies are making it easier to get some work done.

But money talks. No new broadband funding was announced, but the report does highlight the federal agriculture department’s new ReConnect program, which will direct $600 million into rural projects. It also offers clues to other sources of broadband money in the federal bureaucracy…

Other Agencies have also made broadband an allowable expense within their current funding streams. Funding for broadband infrastructure may be supported by block and formula grants provided through programs managed by HUD and the DOE. The Economic Development Administration (EDA), Appalachian Regional Commission (ARC), and DRA have identified broadband as an eligible expense and a priority for economic development. These funding streams are critical. They can catalyze private investment and ensure that services are sustained and upgraded over time.

The report also recommends closer cooperation between the agriculture department and the Federal Communications Commission, suggesting that the USDA’s infrastructure construction grants and the FCC’s Connect America Fund (CAF) operating subsidies could complement each other.

Perhaps, but it would require a major change in the way the FCC decides who gets CAF money. Right now, incumbent telephone companies get first dibs on nearly all the money, and what’s left over is auctioned off. USDA, on the other hand, opens up infrastructure grant application windows at irregular intervals. Redesigning the programs would almost certainly require congressional approval.

One agency is conspicuously absent from the action items. Although the report mentions the federal transportation department, it doesn’t sketch out a role for it, and there’s no mention of dig once requirements for federal highway projects.

Eligibility, application details for $600 million rural broadband subsidy program released

by Steve Blum • , , , ,

Salinas valley field

Rural broadband grant money will go to areas where 100% of homes do not have access to sufficiently fast service, which is defined as 10 Mbps download and 1 Mbps upload speeds from a wireline or fixed wireless provider. Mobile and satellite service don’t count. If a mix of grant and loan is applied for, then only 90% of the homes have to be unserved at that level.

The federal agriculture department rolled out its new ReConnect program in a webinar yesterday, and filled in a lot of the details about what sort of areas are eligible, which will score higher than others, and who can apply for the $300 million in grants and $300 million in loan money approved by congress earlier this year.

Grants will go to applicants who score the most points on the program’s grading scale. The fewer people per square mile and the more farms served, the more points a project gets. The points max out at 6 people or fewer per square mile and 20 farms served. Serving businesses, schools, health care and other critical facilities, and tribal lands also rate higher.

Faster speeds are better. The minimum service speed for subsidised projects is 25 Mbps download/3 Mbps upload, but proposals that promise a symmetrical 100 Mbps to every home and business in the project area will score the best.

For the most part, the program will avoid spending money in areas that received broadband subsidies from either state or federal sources.

One question left unanswered – and I asked it – is whether communities where the Federal Communications Commission’s Connect America Fund (CAF–2) is paying incumbent telephone companies to upgrade service to the 10 Mbps down/1 Mbps level (areas where CAF–2 subsidies were auctioned off are explicitly ineligible, though). Those build outs are not yet complete, and not all homes and businesses in a given community are subsidised, so it’s possible that some areas earmarked for CAF–2 money would lack sufficiently fast service and, presumably, be eligible.

Pretty much any organisation other than a sole proprietorship or simple partnership can apply, including local governments, cooperatives and non-profit corporations. There is one catch: either the applicant, or the applicant’s parent company, has to have been in business for at least two years. Start-ups need not apply.

States with better broadband programs will get a boost, too. Extra points go to projects in states that have a broadband development plan, that don’t keep utilities out of the broadband business and streamline permit and environmental clearances.

One intriguing hint was dropped during the webinar. The program managers are anticipating a second round of funding after the initial money is spent. It’s possible that another deal could be cut as part of a federal budget package – that’s where the $600 million came from. But it seems likelier that the new money will come from the $1.7 billion earmarked for broadband grants and loans in the recently passed farm bill.

The fun is only beginning.

Rural Utilities Service, funding opportunity announcement and solicitation of applications, ReConnect broadband grant and loan program, 14 December 2018.

I’m collecting documents regarding this program here.

$600 million federal rural broadband subsidy program launches, grant applications due in April

by Steve Blum • , , , ,

Salinas ag tech summit 13jul2018

The federal agriculture department will be handing out $300 million in broadband upgrade grants, and making another $300 million in loans next spring. It’s the result of a new rural broadband subsidy program that was included in a massive federal budget bill earlier this year. The (sparse) details were announced on Thursday, the day after the federal farm bill was passed by congress.

The ReConnect program, as it’s called, has a lot in common with the 5 year, $350 million per year broadband subsidy funding in the farm bill. Including one important new feature: grants are available, in addition to loans. In the past, most of the broadband development money managed by the agriculture department’s Rural Utilities Service (RUS) was given out as loans. It’s a funding model that works well for established rural service providers, such as electric or telephone cooperatives, but it’s not so useful for new market entrants.

Another similarity is speed standards. The money is targeted at communities that lack “sufficient access to broadband service”, which is defined as 10 Mbps download and 1 Mbps upload speeds. That’s disappointing – although it’s better than what cable and telco lobbyists bought sold at the California capitol, it’s significantly slower than the 25 Mbps down/3 Mbps up that the agriculture department uses as the minimum necessary residential broadband service level for other purposes, and nowhere near the 100 Mbps down/20 Mbps up speeds that rural homes and business actually need.

The good news is that any broadband infrastructure built with money from the ReConnect program has to be capable of delivering service at speeds of 25 Mbps down/3 Mbps up. The farm bill goes one step further by requiring subsidised infrastructure to be future proof, at least to a degree.

A proposed project area is eligible if 90% of the homes don’t have access to that level of service. The project area also has to be in a rural area, but that’s generously defined: any city with 20,000 people or fewer, or any urbanised area next to a city with 50,000 or fewer people is eligible.

That limit could change. The farm bill raises the population limit for cities to 50,000 people, and that language might end up applying to the ReConnect program as well. It’s just one of the many details that still have to be worked out. The general outline of the program was published on Thursday, but the application and other detailed requirements won’t be available until February.

The deadline for grant applications is 29 April 2018, with grant + loan and loan-only proposals due later, on 29 May and 28 June 2018, respectively.

Lots of fiber in federal farm bill, and it’s not just hemp

by Steve Blum • , , , ,

Hemp

A five year farm bill with billions of dollars set aside for improving broadband infrastructure in rural areas is heading for president Donald Trump’s desk. Negotiators from the federal senate and house of representatives cobbled together a compromise bill earlier this week, and the house gave it a final blessing yesterday. It keeps most of the pro-broadband development provisions in earlier drafts.

The bill also legalises hemp production – the roping, not the doping kind.

The conference report is more than 800 pages long, and until I get through it all in detail I’m not going to try to figure how much broadband money is actually in it. One provision sets aside $350 million a year for five years for just a couple of programs. And there are several more that deal with broadband, directly or indirectly.

What’s clear from a quick read, though, is that rural representatives aren’t buying the nonsense pushed by AT&T and other monopoly telcos (and swallowed hook, line and sinker by the Federal Communications Commission) that 10 Mbps download and 1 Mbps upload speeds are adequate. Although that’s the level that at least some of the new rural grants and loan programs will use to determine eligibility – i.e. if a community has that level of service, it wouldn’t be eligible for subsidies – any infrastructure built with that money will have to do better. The bill sets the minimum speeds for new service at 25 Mbps down/3 Mbps up, and the agriculture department will have to look ahead and raise the bar as necessary to meet “projections of minimum acceptable standards of service for 5, 10, 15, 20, and 30 years into the future”.

That’s true even if it means a do-over in some places…

The [congressional negotiators] are acutely aware of the challenges created by the ever-increasing bandwidth needs of applications running over the Internet. These bandwidth needs mean that the expectation for “broadband-quality service” in urban, suburban, and rural communities increases over time. While protecting project areas provided assistance from a competing USDA-assisted project is essential for program integrity, such protections can result in a lack of further investment in rural broadband systems and rural residents receiving levels of service which degrade relative to expectations over time.

In establishing the broadband buildout speeds, the [congressional negotiators] intend the [federal agriculture secretary] establish requirements for applicants to build systems capable of providing higher quality broadband service as the term of assistance lengthens, to help to ensure that USDA-financed broadband systems are able to meet the connectivity needs of rural residents for the entirety of the length of time such system is protected from overbuilding under USDA’s broadband programs.

The bill allows spending on middle mile projects, which are particularly needed in rural areas where wholesale connections to major Internet hubs, like Silicon Valley, are at best prohibitively expensive but often unavailable at any price.

It’s welcome relief for rural Californians. The forward looking standards and the wholistic view of necessary broadband infrastructure is a stark contrast to the California legislature’s decision last year to lower the minimum acceptable broadband standard to 6 Mbps down/1 Mbps up and tightly restrict middle mile funding. The millions of dollars – $1.3 million in the past legislative session alone – that AT&T, Comcast, Charter, Frontier and other incumbents have paid to California legislators produced results in Sacramento. They hand out even bigger bags of cash in Washington, D.C., but fortunately rural interests count for a lot more there.

California can offer a cure for midwest derangement syndrome

by Steve Blum • , , ,

Monterey County’s former U.S. congressman, Sam Farr, used to call it “midwest derangement syndrome”. That’s the condition that seems to afflict federal agriculture department subsidy programs, including broadband development grants and loans.

It’s real. The agriculture department’s Rural Utilities Service (RUS) has a long track record of favoring small states with lots of small farms in small counties. In other words, the sort of rural communities that predominate in the midwestern and southern U.S.

California has places where you can find traditional family farms with traditional farm families in residence. But more commonly, you’ll find three other kinds of rural: exurban bedroom and, effectively, retirement communities, traditional western rural economies built around ranching, mining, timber or tourism, and small (by Californian standards) cities in the midst of large corporate croplands. Residents of towns like Gonzales and Hilmar don’t live on farms. They commute.

A big federal budget bill passed earlier this year set aside $600 million for “a new broadband loan and grant pilot program”. It’s up to RUS to figure out what that means, and they’re asking for advice

Eligible rural areas are defined as having at least 90 percent of the households without sufficient access to broadband, defined in the law as 10 Mbps downstream, and 1 Mbps upstream. At present, RUS is working to determine what types of technologies and services are defined as ‘‘sufficient access.’’ In particular, RUS is seeking information about the transmission capacity required for economic development, and speed and latency, especially in peak usage hours, to ensure rural premises have access to coverage similar to that offered in urban areas. Comments are specifically requested on whether affordability of service should be included in evaluating whether an area already has ‘‘sufficient access’’ and how to benchmark affordability of internet services. And if so, what equates to consumers’ costs being so high that they are effectively rendered inaccessible to rural households?

It’s a very good question. If broadband costs too much or is delivered, say, via flakey wireless systems, are the needs of rural communities being met?

This is also an opportunity to make the case for California’s kind of rural. Comments are due 10 September 2018.

It’s small ball, but at least U.S. congress is playing the broadband game

by Steve Blum • , , , ,

Two broadband-related bills were passed by the U.S. house of representatives last week. Both focus on the federal broadband bureaucracy rather than infrastructure deployment or service upgrades, but at least there’s the hope that something will come of it.

House resolution 4881 was carried by representative Bob Latta (R – Ohio). It aims to promote “precision agriculture”, which seems to be just another way of saying “ag tech”. But it’s really about bringing modern broadband service to unserved rural areas. Sorta. It sets up a series of study groups, first within the federal bureaucracy, then including people from various aspects of the agriculture and telecoms industries. They’re charged with figuring out…

  1. The status of fixed and mobile broadband Internet access service coverage of agricultural land;
  2. The projected future connectivity needs of agricultural operations, farmers, and ranchers; and
  3. The steps being taken to accurately measure the availability of broadband Internet access service on agricultural land and the limitations of current, as of the date of the report, measurement processes.

HR 3994, by Paul Tonko (D – New York), would set up an Office of Internet Connectivity and Growth inside the National Telecommunications and Information Administration. It would be responsible for doing pretty much the same thing: figuring out where broadband gaps are, and how to encourage other federal agencies to plug them.

It’s hard to get excited about either bill. At best, we can expect to see a lot of meetings over the next two or three year, capped by what I’m sure will be earnest reports. But there are a couple of encouraging things.

First, it’s good that federal lawmakers can move something, anything at all. And even better that broadband bills are moving ahead on a bipartisan basis – both passed by wide margins.

Second, there seems to be agreement that broadband responsibilities aren’t limited to the Federal Communications Commission, which is a regulator and not a developer, and the federal agriculture department’s Rural Utilities Service, which is stuck in a 1930s electric cooperative business model.

Another reason not to get excited is that neither bill is law yet. The U.S. senate has to act, which is usually not the way the bet, and the president has to sign it, which means all bets are off.