federal register 2010-1097 broadband stimulus rules for funding round ii ntia and rus 01-22-2010

8/14/2019 Federal Register 2010-1097 Broadband Stimulus Rules for Funding Round II NTIA and RUS 01-22-2010

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3792 Federal Register / Vol. 75, No. 14 / Friday, January 22, 2010/ Notices

1American Recovery and Reinvestment Act of2009, Pub. L. No. 1115, 123 Stat. 115 (2009)(Recovery Act).

2Statement on Signing the American Recoveryand Reinvestment Act of 2009, Daily Comp. of Pres.Doc., 2009 DCPD No. 00088, at 1 (Feb. 17, 2009),http://fdsys.gpo.gov/fdsys/pkg/DCPD-200900088/pdf/DCPD-200900088.pdf.

3Recovery Act sec. 3(a), 123 Stat. at 11516.4See id. Sec. 3(b), 123 Stat. at 116.

DEPARTMENT OF COMMERCE

National Telecommunications andInformation Administration

[Docket No. 0907141137002406]

RIN 0660ZA28

Broadband Technology Opportunities

Program

AGENCY: National Telecommunicationsand Information Administration (NTIA),U.S. Department of Commerce.

ACTION: Notice of Funds Availability(NOFA) and solicitation of applications.

SUMMARY: NTIA announces generalpolicy and application procedures forthe Broadband TechnologyOpportunities Program (BTOP orProgram) that the agency establishedpursuant to the American Recovery andReinvestment Act of 2009 (RecoveryAct). BTOP provides grants for

deploying broadband infrastructure inunserved and underserved areas of theUnited States, enhancing broadbandcapacity at public computer centers, andpromoting sustainable broadbandadoption projects. In facilitating theexpansion of broadbandcommunications services andinfrastructure, BTOP advances theobjectives of the Recovery Act to spurjob creation and stimulate long-termeconomic growth and opportunity.

DATES: All applications for fundingBTOP projects must be submitted

between February 16, 2010, at 8 a.m.

Eastern Standard Time (EST) and March15, 2010, at 5 p.m. Eastern DaylightTime (EDT).

ADDRESSES: The application packagesfor electronic submissions will beavailable at http://www.broadbandusa.gov. SeeSUPPLEMENTARY INFORMATION for moredetails.

FOR FURTHER INFORMATION CONTACT: Forgeneral inquiries regarding BTOP orquestions regarding this NOFA, contactAnthony Wilhelm, Director, BTOP,Office of Telecommunications and

Information Applications, NationalTelecommunications and InformationAdministration, U.S. Department ofCommerce (DOC), 1401 ConstitutionAvenue, NW., HCHB, Room 4887,Washington, DC 20230; Help Desk e-mail: [email protected], HelpDesk telephone: 18775088364.Additional information regarding BTOPmay be obtained at http://www.ntia.doc.gov/broadbandgrants/.For inquiries regarding BTOPcompliance requirements, includingapplicable Federal rules and regulations

protecting against fraud, waste, andabuse, [email protected] information regardingcompliance for BTOP may be obtainedat http://www.broadbandusa.gov/compliance.htm.

Authority: This notice is issued pursuantto the American Recovery and ReinvestmentAct of 2009, Pub. L. 1115, 123 Stat. 115(2009).

SUPPLEMENTARY INFORMATION:Electronic submissions: Electronic

submissions of applications will allowfor the expeditious review of anapplicants proposal consistent with thegoals of the Recovery Act. As a result,all applicants are required to submittheir applications electronically athttps://applyonline.broadbandusa.gov.The electronic application system willprovide a date-and-time-stampedconfirmation number that will serve asproof of submission. Please note that

applications will not be accepted viapaper, facsimile machine transmission,electronic mail, or other media format.Applicants, however, may request awaiver of these filing instructionspursuant to Section X.N. of this NOFA.

Catalog of Federal DomesticAssistance (CFDA) Number: BroadbandTechnology Opportunities Program(BTOP)11.557.

Additional Items in SupplementaryInformation

I. Overview: Describes the broadbandinitiatives in the Recovery Act, the firstround of funding, and an overview of thenext round of funding.

II. Funding Opportunity Description:Provides a more thorough description ofBTOP and the funding priorities.

III. Definitions: Sets forth the key statutoryterms and other terms used in BTOP.

IV. Award Information: Describes fundingavailability, grant terms, as applicable, andother award information.

V. Eligibility Information and GeneralProgram Requirements: Establishes eligibilitycriteria, eligible and ineligible costs, andgeneral program requirements.

VI. Application and SubmissionInformation: Provides information regardinghow to apply, application materials, and theapplication process.

VII. Application Review Information:Establishes the evaluation criteria forapplication review.

VIII. Anticipated Announcement andAward Dates: Identifies the initialannouncement date for certain awards andprovides other information regarding BTOP.

IX. Award Administration Information:Provides award notice information,administrative and national policyrequirements, terms and conditions, andother reporting requirements for awardrecipients.

X. Other Information: Sets forth guidanceon funding, compliance with various laws,

confidentiality, discretionary awards, andauthorized signatures.

I. Overview

A. American Recovery andReinvestment Act of 2009 (RecoveryAct)

On February 17, 2009, PresidentObama signed the Recovery Act into

law.1 The essential goal of the RecoveryAct is to provide a direct fiscal boostto help lift our Nation from the greatesteconomic crisis in our lifetimes and laythe foundation for future growth. 2Accordingly, the Recovery Act identifiesfive overall purposes: To preserve andcreate jobs and promote economicrecovery; to assist those most impacted

by the current economic recession; toprovide investments needed to increaseeconomic efficiency by spurringtechnological advances in science andhealth; to invest in transportation,environmental protection, and other

infrastructure that will provide long-term economic benefits; and to stabilizeState and local government budgets.3The Recovery Act further instructs thePresident and the heads of Federaldepartments and agencies to manageand expend Recovery Act funds toachieve these five purposes,commencing expenditures andactivities as quickly as possibleconsistent with prudent management. 4

Consistent with the purposesdescribed above, the Recovery Actprovides the U.S. Department ofAgricultures Rural Utilities Service(RUS) and the NationalTelecommunications and InformationAdministration (NTIA) with $7.2 billionto expand access to broadband servicesin the United States. In so doing, theRecovery Act recognizes the growingimportance of access to broadbandservices to economic development andto the quality of life of all Americans.

The Recovery Act provides $4.7billion to NTIA to establish theBroadband Technology OpportunitiesProgram (BTOP or Program) and directsthat these funds be awarded bySeptember 30, 2010. This amountrepresents a significant investment to

advance President Obamas nationalbroadband strategy. Of these funds, atleast $200 million will be madeavailable for competitive grants for

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3793Federal Register / Vol. 75, No. 14 / Friday, January 22, 2010/ Notices

5Pub. L. 110385, 122 Stat. 4096 (to be codifiedat 47 U.S.C. 1301 et seq.).

6See State Broadband Data and DevelopmentGrant Program, Notice of Funds Availability andSolicitation of Applications, 74 FR 32545 (July 8,2009).

7Notice of Funds Availability and Solicitation ofApplications, 74 FR 33104 (July 9, 2009).

8White House Press Release, Vice PresidentBiden Kicks Off $7.2 Billion Recovery ActBroadband Program (December 17, 2009), availableat http://www.whitehouse.gov/the-press-office/vice-president-biden-kicks-72-billion-recovery-act-broadband-program. Department of CommercePress Release, Commerce Secretary Gary LockeAnnounces $7.5 Million Investment to IncreaseBroadband Access in Los Angeles (January 13,2010), available at http://www.commerce.gov/newsroom/pressreleases_factsheets/prod01_008797.

9Joint Request for Information (RFI), 74 FR 58940(Nov. 16, 2009).

10See Recovery Act Div. A, Tit. II, 123 Stat. at128.

11 Id. Div. A, Tit. II & sec. 6001(b)(3), 123 Stat. at128, 51213.

12 Id. Div. A, Tit. II & sec. 6001(b)(5), 123 Stat. at128, 513.

expanding public computer centercapacity; at least $250 million will bemade available for competitive grantsfor innovative programs to encouragesustainable adoption of broadbandservices; and up to $350 million will bemade available to fund the StateBroadband Data and Development GrantProgram (Broadband Mapping Program)

authorized by the Broadband DataImprovement Act.5 The BroadbandMapping Program is designed to supportthe development and maintenance of anationwide broadband map for use bypolicymakers and consumers.6

B. Round One

In response to the first Notice ofFunds Availability (First NOFA), RUSand NTIA received almost 2,200applications requesting nearly $28

billion in funding for proposedbroadband projects reaching all States,five territories, and the District ofColumbia.7 When including about $10.5

billion in matching funds committed bythe applicants, these applicationsrepresent more than $38 billion inproposed broadband projects. RUS andNTIA received applications from adiverse range of parties, including:State, tribal, and local governments;nonprofits; industry; small businesses;community anchor institutions such aslibraries, universities, communitycolleges, and hospitals; public safetyorganizations; and other entities inrural, suburban, and urban areas. Partiessubmitted more than 830 applicationsjointly to RUSs Broadband Initiatives

Program (BIP) and NTIAs BTOP,requesting nearly $12.8 billion ininfrastructure funding. NTIA receivedan additional 260 infrastructureapplications that sought only BTOPfunding, requesting more than $5.4

billion in grants for broadbandinfrastructure projects in unserved andunderserved areas. Parties submittedmore than 360 applications to NTIArequesting more than $1.9 billion ingrants from BTOP for public computercenter projects. In addition, parties filedmore than 320 applications with NTIArequesting nearly $2.5 billion in grants

from BTOP for projects that promotesustainable demand for broadbandservices.

On December 17, 2009, NTIAannounced the first set of awards out ofthe $1.6 billion that was allocated for

the first round of funding. Theseawards, as well as additional awardsannounced by Secretary Locke on

January 13, 2010, totaled approximately$137 million for investments in ten

broadband projects benefitting tenStates.8 Of these awards, $119 millionwas dedicated for Middle Mile projects;$15.9 million for Public Computer

Center projects; and $2.4 million forSustainable Broadband Adoptionprojects. Additional awards will beannounced on a rolling basis.

C. Round Two

1. Funding Process

The purpose of this NOFA is todescribe the availability of BTOP fundsfor the second round of funding and setforth the application requirements forthose entities wishing to participate inthe Program. Applicants are permittedto apply to one or more of the projectcategories. Each application will be

screened for initial eligibility. Thoseeligible applications that satisfy thestatutory purposes and fundingpriorities will be prioritized andevaluated against objective evaluationcriteria to determine whether an awardmay be merited. Applications thatsatisfy the BTOP priorities and scorehighly when evaluated against theobjective evaluation criteria willadvance to the due diligence stage ofreview, where NTIA may requestadditional information and adjustmentsto the proposal. From this pool ofapplications, NTIA will select awardees

based on the selection factors. NTIAanticipates completing this round offunding as quickly as possible tomaximize the stimulative effect of theRecovery Act. NTIA also is committedto transparency and fairness in theaward process and will require rigorousreporting to ensure prudent stewardshipof taxpayer funds.

2. Request for Information (RFI)

To prepare for this round of funding,on November 10, 2009, RUS and NTIAreleased a second joint request forinformation seeking public comment onways to enhance the applicant

experience through targeted revisions tothe First NOFA.9 RUS and NTIA

received approximately 225 commentsfrom institutions and individuals on awide range of topics, and thesecomments have played an importantrole in developing this NOFA. Forfurther discussion and explanation ofNTIAs reliance on the public commentsin the policy decisions involved inBTOP, see the attached Policy

Justification found in the Appendix atthe end of this NOFA.

3. Project Categories

For this round of funding, NTIA willaward grants in three categories ofeligible projects: ComprehensiveCommunity Infrastructure (CCI), PublicComputer Centers (PCC), andSustainable Broadband Adoption(SBA).10 The CCI category will focus onMiddle Mile broadband infrastructureprojects that offer new or substantiallyupgraded connections to communityanchor institutions, especiallycommunity colleges. The PCC categorywill help expand public access to

broadband service and enhancebroadband capacity at entities thatpermit the public to use thesecomputing centers, such as communitycolleges and public libraries.11 The SBAcategory will fund innovative projectsthat promote broadband demand,including projects focused on providing

broadband education, awareness,training, access, equipment, or support,particularly among vulnerablepopulation groups that traditionallyhave underutilized broadbandtechnology.12

NTIA plans to award all remainingBTOP grants funded by the RecoveryAct in this round of funding.Approximately $2.6 billion of program-level funding has been allocated to thisNOFA by NTIA. NTIA intends to awardapproximately $2.35 billion for CCIprojects, at least $150 million for PCCprojects, and at least $100 million forSBA projects.

4. Changes From the First NOFA

Based on the comments received inresponse to the second RFI and theexperience gained from administeringthe first round of funding, NTIA ismaking a number of changes to theProgram. The goals of these changes areto increase efficiency, sharpen thePrograms funding focus, and improvethe applicant experience.

In the first round, RUS and NTIAissued a joint BIP/BTOP NOFA to



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13See id. Sec. 6001(b), 123 Stat. at 51213.

promote coordination between theseprograms. The agencies gave applicantsthe option to file a single application forinfrastructure projects for bothprograms. For the second round offunding, RUS and NTIA have decided toissue separate NOFAs for BIP and BTOPto better promote each agencys distinctobjectives. The joint application process

was burdensome for some applicants.Therefore, RUS and NTIA haveeliminated the option of allowingapplicants to file a single, joint BIP/BTOP application in the second fundinground in favor of separate applications.

NTIA has sought to bring furtherleverage to Federal funds by givingadditional consideration to projects thatpropose to contribute a non-Federal costshare/match that equals or exceeds 30percent of the total eligible costs of theproject.

In addition, NTIA is adopting acomprehensive communities approachto award BTOP grants for infrastructureprojects that emphasize Middle Mile

broadband capabilities and new orsubstantially upgraded connections tocommunity anchor institutions tomaximize the benefits of BTOP funds. Inadopting this approach, NTIA hasrestructured the BroadbandInfrastructure category of the FirstNOFA into the CCI category for thissecond round of funding.

Further, NTIA has implemented othertargeted changes to several Programprovisions. In particular, NTIA hasreduced the number of BTOPseligibility factors to just three criteria

eligible entities, fully completedapplication, and matchingwhich will

be used to determine whether anapplication is eligible for consideration.NTIA has further streamlined theeligibility review by removing the

budget reasonableness and technicalfeasibility factors from the eligibilityrequirements, because these categoriesare more effectively evaluated duringthe expert review and due diligencephases of application consideration.NTIA also has changed the number ofexpert reviewers from at least three to atleast two in order to make the expert

review process as efficient as possible,without impacting the rigor of review.NTIA will review CCI applicationsaccording to the priorities established inSection II.B. Additionally, NTIA hasclarified the process for requestingwaivers from several key statutory andprogrammatic obligations, including thematching fund requirement, Last Milecoverage obligation, and restriction onthe sale or lease of project assets.

With respect to the application, NTIAwill now collect the information mostessential to project review in the

application itself, with the option tocollect additional data during the duediligence review, as needed. In addition,NTIA has made numerous adjustmentsto the online application system tostreamline the intake of information andreduce applicant burden. In particular,NTIA has reduced the overall number ofattachments to the applications. It also

has separated the BTOP infrastructureapplication from the BIP infrastructureapplication and separated the PCCapplication from the SBA application.Moreover, it has eliminated theproposed funded service area mappingtool and modified the service areadelineations from Census blocks toCensus tracts and block groups. NTIAalso has made it easier for applicantsfiling applications in multiple projectcategories to link these applications, infurtherance of NTIAs focus oncomprehensive communities.

II. Funding Opportunity Description

A. Statutory Purposes

Section 6001 of the Recovery Actestablishes a national broadband servicedevelopment and expansion program topromote five core purposes:

a. To provide access to broadbandservice to consumers residing inunserved areas of the country;

b. To provide improved access tobroadband service to consumersresiding in underserved areas of thecountry;

c. To provide broadband education,awareness, training, access, equipment,

and support to: (i) Schools, libraries,medical and healthcare providers,community colleges and otherinstitutions of higher learning, and othercommunity support organizations; (ii)organizations and agencies that provideoutreach, access, equipment, andsupport services to facilitate greater useof broadband services by vulnerablepopulations (e.g., low-income,unemployed, aged); or (iii) job-creatingstrategic facilities located in State- orFederally-designated economicdevelopment zones;

d. To improve access to, and use of,

broadband service by public safetyagencies; ande. To stimulate the demand for

broadband, economic growth, and jobcreation.13

B. BTOP Priorities

All projects funded under BTOP mustadvance one or more of the fivestatutory purposes outlined above. TheProgram is designed to extend

broadband access to unserved areas,

improve access to underserved areas,and expand broadband access to a widerange of institutions and individuals,including vulnerable populations. Itwill seek to serve the highest priorityneeds for Federal investmentparticularly projects that offer thepotential for economic growth and jobcreation. The Program will support

viable, sustainable, and scalableprojects.

1. Comprehensive CommunityInfrastructure Projects

a. Background

In the first funding round, NTIAsolicited Broadband Infrastructureapplications in two categories, Last Mileand Middle Mile. Last Mile projectswere defined as any infrastructureproject the predominant purpose ofwhich is to provide broadband serviceto end users or end-user devices. Middle

Mile projects were defined as anybroadband infrastructure project thatdoes not predominantly provide

broadband service to end users or toend-user devices and that may includeinteroffice transport, backhaul, Internetconnectivity, or special access. MiddleMile projects funded to date in RoundOne also included expanding andenhancing broadband services forcommunity anchor institutions such asschools, libraries, colleges anduniversities, medical and healthcareproviders, public safety entities, andother community support organizations.

Recognizing the significantimportance of Middle Mileinfrastructure to improving broadbandcapabilities for consumers residing inunserved and underserved areas of thenation, NTIA has awarded a significantportion of funds in the first round offunding to Middle Mile projects,particularly those that connect asignificant number of communityanchor institutions. Such projectsprovide substantial benefits, includingenhancing broadband service forcommunity anchor institutions,facilitating the development of Last Mile

broadband services in unserved andunderserved areas, and promotingeconomic growth.

b. CCI Funding Priorities

In this round of funding, NTIA seeksto focus on Middle Mile projects byadopting a comprehensivecommunities approach to awardingBTOP infrastructure grants. Under thisapproach, priority will be given to CCIprojects that include a Middle Milecomponent and satisfy certain



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14Consistent with the terms of the Recovery Act,in this funding round NTIA will not fund MiddleMile projects in areas that RUS has already fundedwith Middle Mile awards made through BIP.

15See Department of Commerce (DOC) Grants andCooperative Agreements Interim Manual (GrantsManual), ch. 8, secs. B.1.c. and B.3 (June 21, 2007)(available at http://oam.ocs.doc.gov/GMD_updated-doc.html).

1615 U.S.C. 637(a)(4). NTIA sought the SmallBusiness Administrations approval to adopt a $40million alternative small business size standard forBTOP. The Small Business Administration issued aletter approving the use of this alternative sizestandard of $40 million to define a small businessconcern for purposes of BTOP.

17See infra Section VII.A.1.

18Consistent with the terms of the Recovery Act,in this funding round NTIA will not fund Last Mileprojects in areas that RUS has already funded withLast Mile awards made through BIP.

19See Recovery Act sec. 6001(j), 123 Stat. at 515.20See National Economic Council, Recovery Act

Investments in Broadband: Leveraging FederalDollars to Create Jobs and Connect America (Dec.2009), available at http://www.whitehouse.gov/sites/default/files/20091217-recovery-act-investments-broadband.pdf.

additional considerations.14 Thisprioritization will be used for thesequencing of applications for theobjective merit review performed byexpert reviewers.15 In particular, thehighest priority for merit review will begiven to CCI applications that satisfy allof the criteria below. Note that theapplication evaluation process will

continue to consider additional factors,including, for example, the degree towhich the projects will benefitconsumers residing in unserved orunderserved areas, the participation ofan Indian Tribe or socially andeconomically disadvantaged small

business concern as defined underSection 8(a) of the Small Business Act(as modified by NTIAs adoption of analternative small business concern sizestandard for use in BTOP),16 and theability of a project to leverage fundingfrom another Recovery Act program orother State or Federal development

program.17

In order of importance, theCCI priority criteria are set forth asfollows:

(1) Projects that will deploy MiddleMile broadband infrastructure with acommitment to offer new orsubstantially upgraded service tocommunity anchor institutions. Thoseprojects proposing to serve a significantnumber of community anchorinstitutions that have expressed ademand or indicated a need for accessor improved access to broadband servicewill receive higher priority;

(2) Projects that will deploy MiddleMile broadband infrastructure and

incorporate a public-private partnershipamong government, non-profit and for-profit entities, and other key communitystakeholders, particularly those thathave expressed a demand or indicateda need for access or improved access to

broadband service;(3) Projects that will deploy Middle

Mile broadband infrastructure with theintent to bolster growth in economicallydistressed areas;

(4) Projects that will deploy MiddleMile broadband infrastructure with acommitment to serve community

colleges that have expressed a demandor indicated a need for access orimproved access to broadband service;

(5) Projects that will deploy MiddleMile broadband infrastructure with acommitment to serve public safetyentities that have expressed a demandor indicated a need for access orimproved access to broadband service;

(6) Projects that will deploy MiddleMile broadband infrastructure thatincludes (i) a Last Mile infrastructurecomponent in unserved or underservedareas; or (ii) commitments or non-

binding letters of intent from one ormore Last Mile broadband serviceproviders.18 For Last Mile infrastructurecomponents in rural areas, however, theadditional costs of the Last Milecomponent used to offer service toresidential consumers and non-community anchor institutions may notexceed more than 20 percent of the totaleligible costs of the project; and

(7) Projects that will deploy MiddleMile broadband infrastructure andpropose to contribute a non-Federal costmatch that equals or exceeds 30 percentof the total eligible costs of the project.

To the extent that a CCI applicantwith a Middle Mile component does notaddress all of the criteria set forth above(i.e., criteria (1)(7)), NTIA willprioritize those applications remainingfor merit review in the order that theysatisfy the most highly-ranked criteria(i.e., applications satisfying criteria (1)(6) will be sequenced for merit review,then applications satisfying (1)(5), then

(1)(4), then (1)(3), then (1)(2)respectively, and, finally, applicationsthat satisfy only the first criterion). Allother CCI applicants with a Middle Milecomponent, that is, those that do notsatisfy the first criterion identifiedabove, will be next in priority for meritreview.

c. Comprehensive Communities PolicyRationale

The comprehensive communitiesapproach, with its focus on thedeployment of Middle Mile broadbandfacilities and the provision of new orsubstantially upgraded connections to

community anchor institutions as itscenterpiece, will provide a number of

benefits to the public and taxpayers.Comprehensive communities projectscan leverage resources and better ensuresustainable community growth andprosperity. These projects also cancreate consumer demand and lay thefoundation for the ultimate provision of

reasonably priced end-user broadbandservices in unserved and underservedcommunities. Open andnondiscriminatory CCI projects funded

by BTOP will enable other serviceproviders to serve the community.19Once Middle Mile facilities are built,the costs of providing services to a

broad array of end users are reduced.

Much like the interstate highways thatlink together the nations roads andstreets, Middle Mile broadband facilitiesplay a critical role in the healthyfunctioning of the nations broadbandinfrastructure and are a necessaryfoundation for the ultimate provision ofaffordable end-user broadband servicesin unserved and underservedcommunities.

Expanding Middle Mile broadbandservice not only enhances theavailability and affordability of end-user

broadband connectivity for consumersand businesses, it also increases the

effectiveness of community anchorinstitutions in fulfilling their missions.Schools, libraries, colleges anduniversities, medical and healthcareproviders, public safety entities, andother community support organizationsincreasingly rely on high-speed Internetconnectivity to serve theirconstituencies and their communities.Expanding broadband capabilities forcommunity anchor institutions willresult in substantial benefits for theentire community, delivering improvededucation, healthcare, and economicdevelopment.

CCI projects are also job-intensive and

pave the way for a ripple effect ofeconomic development throughout thecommunities they touch. Focusing theawards in this funding round on CCIprojects that provide high-speed MiddleMile networks to connect communityanchor institutions, includingcommunity colleges, or benefitconsumers residing in unserved orunderserved areas will maximize the

benefits of Recovery Act dollars and laya foundation for economic developmentfor years to come.20

d. Relationship to BIP

Although BIP and BTOP no longerwill offer a joint application, RUS andNTIA continue to collaborate tomaximize the impact of availableFederal funding, to best leverage theexperience and expertise of eachagency, and to avoid geographic overlap



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21Recovery Act Tit. I, 123 Stat. at 118. 22Recovery Act sec. 6001(c), 123 Stat. at 513.

in projects funded by the two agencies(as required by the Recovery Act).21 Toaccomplish these objectives, NTIAstrongly recommends that CCIapplicants that are currently RUS loanor grant recipients as well as any CCIapplicant whose project will include aLast Mile service area that is at least 75percent rural apply to BIP for funding.

Applications from such applicants willnot be viewed favorably by NTIA andwill not be a funding priority.

e. Exclusive Last Mile Projects

As explained above, priority will begiven to CCI projects that include aMiddle Mile component. While a CCIproject may exclusively contain a LastMile component, it will only beconsidered for merit review and fundingafter all projects with a Middle Milecomponent have been considered.

2. Public Computer Centers (PCC)

In this funding round, consistent withthe Recovery Act, NTIA will fund PCCprojects. These projects provide

broadband access to the general publicor a specific vulnerable population andmust either create or expand a publiccomputer center or improve broadbandservice or connections at a publiccomputer center, including those atcommunity colleges, that meets aspecific public need for broadbandservice. PCC projects are a logicalcomplement to CCI projects, becausethey are uniquely positioned to servemany members of a community withcomputer equipment, computer

training, job training, and access to joband educational resources that mightnot otherwise be available.

3. Sustainable Broadband Adoption(SBA)

Consistent with the Recovery Act andthe promotion of BTOPs five coreobjectives, NTIA also will fund SBAprojects. The SBA program is designedto fund innovative projects that promote

broadband demand, especially amongvulnerable population groups where

broadband technology traditionally hasbeen underutilized. Broadband

technology has reshaped the way ournation functions, and NTIA recognizesthat broadband adoption projects striveto ensure that as much of the populationas possible has opportunities, abilities,and resources to thrive in todayssociety. With projects focusing on

broadband awareness, access, training,and education, barriers to broadbandadoption can be overcome, fosteringeducational and business opportunitiesand a more competitive country as a

whole. NTIA, therefore, seeks SBAprojects that, after establishing asubscribership baseline in a givencommunity, demonstrate a clear abilityto measure and sustain the expectedincrease in broadband adoption withoutongoing Federal grant assistance, so thatthe nation will continue to see the

benefits of these projects well after the

period of performance for the grantaward has ended.

C. Application Review and the SelectionProcess

1. Initial Review

NTIA will conduct an initial review ofapplications to determine whether theymeet the eligibility requirements setforth in Section V.A. through V.C. ofthis NOFA. These requirements aremandatory, and applicants that fail tomeet them will not have theirapplications considered further.

2. Scoring ApplicationsSubsequent to this initial eligibility

review, applications will be separatedinto the three project categories. ForPCC and SBA projects, applications willreceive an Evaluation Criteria Reviewscore by at least two objective expertreviewers who may be Federalemployees or non-Federal persons. ForCCI projects, program staff willprioritize the applications for theEvaluation Criteria Review based on theBTOP priorities set forth in Section II.B.,and then the applications will beevaluated in priority order by at least

two objective expert reviewers who maybe Federal employees or non-Federalpersons. No consensus advice will beprovided by the non-Federal expertreviewers.

Reviewers will be selected based ontheir expertise in: (i) Analyzing a

business or organizational modelpursuant to BTOP purposes; (ii)designing, funding, constructing, oroperating broadband networks or publiccomputer centers; (iii) broadband-related outreach, training, or education;(iv) innovative programs to increase thedemand for broadband services; or (v)

other broadband-related functions oractivities. Reviewers will evaluateapplications against the evaluationcriteria provided in this NOFA andindependently score each application.Reviewer scores will be averaged andNTIA will establish thresholds that will

be used to determine whichapplications are considered highlyqualified. Highly qualified applicationsmay be considered further for an award

by NTIA Program staff and given a duediligence review. For CCI projects,priority in due diligence processing will

be given to applications that bestconform to BTOP priorities as expressedin Section II.B.1.b of this NOFA.

3. State and Tribal Consultation

The Recovery Act authorizes NTIA toconsult with States, territories,possessions, and the District ofColumbia (States) regarding the

identification of unserved andunderserved areas within their bordersand the allocation of grant funds toprojects in or affecting their State.22After the application deadline, NTIAwill invite each State, via its Governor,to provide input on those geographicareas within the State for which NTIAshould give priority in selecting projectsfor funding. States may, if they wish,comment on specific BTOP applicationsthat propose to serve areas within theirjurisdiction, regardless of the size orgeographic scope of the project and, attheir discretion, provide an explanationfor why certain applications meet thegreatest needs of the State. NTIA alsowill extend the invitation to tribalentities to comment upon applicationsthat propose to serve tribal communitiesin an effort to fund projects that bestmeet the needs of their tribal lands.

NTIA will share data that areavailable on the publicly searchableapplication database with each relevantState and tribe. States and tribes thatwish to review additional informationregarding applications proposing toserve areas within their jurisdiction mayrequest such information fromapplicants directly. States and tribes

will not be required to rank or commenton BTOP applications in order forapplications affecting their areas toreceive funding. The input of States andtribes is consultative in nature and,while extremely valuable, constitutesonly one among several factors theSelecting Official, the AssistantSecretary, weighs when evaluatingapplications. States or tribes will nothave the ability to veto any particularproject. States and tribes will have noless than 20 calendar days from the dateof notification to submit their commentsto NTIA. NTIA will make the comments

of the States and tribes publiclyavailable at http://www.broadbandusa.gov. Accordingly,States and tribes should not include intheir comments to NTIA anyinformation that is deemed confidentialand proprietary.

4. Due Diligence Review

During due diligence review,applicants may be asked to submitadditional information, as appropriate,



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23See Recovery Act sec. 6001(e)(3), 123 Stat. at514.

24Recovery Act sec. 6001(h)(2)(D), 123 Stat. at515.

25Consistent with the Recovery Act, theBroadband Mapping Program provides participatingStates the opportunity to identify unserved andunderserved areas in their State.

26This definition is derived from regulationsadopted by the Economic DevelopmentAdministration, U.S. Department of Commerce,regarding the Public Works and EconomicDevelopment Act of 1965, as amended. See 13 CFR301.3.

to clarify or to further substantiate therepresentations made in theirapplications. The supplementalinformation, along with all informationsubmitted with the application, will bereviewed and analyzed by NTIAProgram staff to confirm eligibility andevaluate the applications with respect togeneral Program requirements, the

appropriate Federal share of the project,evaluation criteria, and selection factors.Applicants whose supportingdocuments are not timely filed or whodo not adequately substantiate therepresentations in their applicationsmay be rejected. NTIA may, at itsdiscretion, request supplementaldocumentation before deciding to rejectsuch applications and re-evaluate theapplication package based on all of theinformation presented.

At any time during the applicationreview process, NTIA reserves the rightto discuss with the applicant specific

modifications to the application toresolve any differences that may existbetween the applicants original requestand NTIAs determination of eligiblecosts and funding priorities, including,for example, the right to adjust theFederal share of the project. Note that itis NTIAs intent to fund only the portionof the project that satisfies Programpurposes and is justified based on ananalysis of anticipated costs andrevenues. Specifically, pursuant to theRecovery Act requirement thatapplicants demonstrate that a projectwould not have been implementedduring the grant period without Federalassistance, NTIA may seek to adjust theamount of funds made available for theFederal share of the project to a levelwarranted based on this but for test.23Not all applicants contacted necessarilywill receive a BTOP award. Uponcompletion of due diligence, NTIAProgram staff will summarize theiranalysis for each application reviewed.

5. The Selection Process

The Director of BTOP (BTOP Director)will prepare and present a package orpackages of recommended grant awardsto the Associate Administrator for the

Office of Telecommunications andInformation Applications (OTIAAssociate Administrator), or his/herdesignee, for review and approval. TheBTOP Directors recommendations andthe OTIA Associate Administratorsreview and approval will consider thefollowing selection factors:

a. The Evaluation Criteria Reviewscore of the objective expert reviewers;

b. The analysis of NTIA Program staff;

c. Satisfaction of the statutorypurposes and BTOP priorities set forthin Section II.;

d. The extent to which the non-Federal cost match equals or exceeds 30percent of the total eligible costs of theproject;

e. The geographic distribution of theproposed grant awards (e.g., ensuring

that, to the extent practical, NTIAawards not less than one grant in eachState as set forth in the Recovery Act);

f. The range of technologies and usesof the technologies employed by theproposed grant awards;

g. Avoidance of redundancy,duplication, and conflicts with theinitiatives of other Federal agencies,including Department of Agricultureloan and grant programs for broadbandservices, applicable universal serviceprograms authorized by the FederalCommunications Commission, and, tothe extent practical, avoidance of unjust

enrichment;24

h. The availability of funds;i. If applicable, the comments of

States, including, but not limited to,such comments as described in theirapplication for the Broadband MappingProgram or as subsequently provided toNTIA either on their own or along withthe submission of State-level broadbandmaps; 25 and

j. If applicable, the comments of tribalentities.

Upon approval of the OTIA AssociateAdministrator or designee, the BTOPDirectors recommendations then will

be presented to the Selecting Official.The Assistant Secretary selects theapplications for grant awards, takinginto consideration the BTOP Directorsand the OTIA AssociateAdministrators, or his or her designees,recommendations and the degree towhich the application package, taken asa whole, satisfies the selection factorsdescribed above and the Programsstatutory purposes and priorities as setforth in Sections II of this NOFA.Awards will be made on a rolling basissubject to the availability of funds.Unsuccessful applicants will be notifiedin writing.

III. Definitions

The terms and conditions provided inthis NOFA are applicable to and forpurposes of this NOFA only.

Applicantmeans an entity requestingapproval of an award under this NOFA.

Assistant Secretarymeans theAssistant Secretary for Communicationsand Information, NationalTelecommunications and InformationAdministration, Department ofCommerce, or the Assistant Secretarysdesignee.

Awardmeans a grant made under thisNOFA by NTIA.

Awardee means a grantee.Broadbandmeans providing two-way

data transmission with advertisedspeeds of at least 768 kilobits persecond (kbps) downstream and at least200 kbps upstream to end users, orproviding sufficient capacity in aMiddle Mile project to support theprovision of broadband service to endusers.

BTOPmeans the BroadbandTechnology Opportunities Program,administered by NTIA, under theRecovery Act.

Build-outmeans the construction or

improvement of facilities andequipment as specified in theapplication.

Community anchor institutions meansschools, libraries, medical andhealthcare providers, public safetyentities, community colleges and otherinstitutions of higher education, andother community support organizationsand agencies that provide outreach,access, equipment, and support servicesto facilitate greater use of broadbandservice by vulnerable populations,including low-income, the unemployed,and the aged.

Comprehensive Community

Infrastructure (CCI) projectmeans aninfrastructure project that focusesprimarily on providing new orsubstantially upgraded connections tocommunity anchor institutions.

Economically distressed area meansan area that has: (i) A per capita incomeof 80 percent or less of the nationalaverage; and (ii) an unemployment ratethat is, for the most recent 24-monthperiod for which data are available, atleast one percent greater than thenational average unemployment rate.26

Forecast periodmeans the time periodused by NTIA to determine if an

application is financially feasible.Financial feasibility of an application isbased on eight-year projections.

GAAPmeans generally acceptedaccounting principles.

Grant agreementmeans the agreementbetween NTIA and the grantee for grantsawarded under this NOFA, including



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27A Census block group is a cluster of Censusblocks having the same first digit of their four-digitidentifying numbers within a Census tract. ACensus block group is the next level above Censusblock in the geographic hierarchy.

28Census tracts are small, relatively permanentstatistical subdivisions of a county. Census tractsare delineated for most metropolitan areas (MAs)and other densely populated counties by localCensus statistical areas committees followingCensus Bureau guidelines (more than 3,000 Censustracts have been established in 221 counties outsideMAs). Census tracts usually have between 2,500and 8,000 persons and, when first delineated, are

designed to be homogeneous with respect topopulation characteristics, economic status, andliving conditions. Census tracts do not cross countyboundaries. The spatial size of Census tracts varieswidely depending on the density of settlement.Census tract boundaries are delineated with theintention of being maintained over a long time sothat statistical comparisons can be made fromCensus to Census. However, physical changes instreet patterns caused by highway construction,new development, or other reasons may requireoccasional revisions; Census tracts occasionally aresplit due to large population growth, or combinedas a result of substantial population decline. See theCensus Bureaus Web site at http://www.census.govfor more detailed information on its data gatheringmethodology.

2915 U.S.C. 637(a)(4) (as modified by the SmallBusiness Administrations approval of NTIAsrequest to adopt an alternative small businessconcern size standard for use in BTOP).

30 Implementing Guidance for Reports on Use ofFunds Pursuant to the American Recovery andReinvestment Act of 2009 (OMB M0921 June 22,2009), available at http://www.whitehouse.gov/omb/assets/memoranda_fy2009/m0921.pdf.

3125 U.S.C. 450b(e).

any amendments thereto, setting forththe binding terms and conditionsrelating to Federal funding under BTOP.Sample grant agreements are availablefor review at http://www.broadbandusa.govor http://www.ntia.doc.gov.

Grant funds means Federal fundsprovided pursuant to a grant made

under this NOFA.Grantee means the prime recipient of

a grant under this NOFA.Last Mile means those components of

a CCI project that provide broadbandservice to end-user devices through anintermediate point of aggregation. Thatis, in most cases, the Last Mileconnection goes from the end-userdevice through an intermediate point ofaggregation (i.e., a remote terminal, fibernode, wireless tower, or otherequivalent access point) to a primary IProuting entity in a centralized facility(i.e., in the central office, the cableheadend, the wireless switching station,or other equivalent centralized facility).The Last Mile also includes equivalentservices that, solely because of closeproximity between the customer andcentralized facility, are routed directlyto the centralized facility. The Last Milewill terminate at, and include, theinitial customer-facing router oraggregation switch in the centralizedfacility (e.g., a DSLAM, CMTS, RNC, orequivalent) that is utilized to deliverLast Mile broadband service.

Last Mile service area means theservice area of a Last Mile component ofa CCI project, composed of one or more

contiguous Census block groups27

ortracts,28 where the applicant isrequesting BTOP funds to provide

broadband service to end-user devicesthrough an intermediate point ofaggregation and terminating at theinitial customer-facing router oraggregation switch in the centralizedfacility used to deliver the Last Mile

broadband service.Middle Mile means those components

of a CCI project that provide broadband

service from one or more centralizedfacilities, (i.e., the central office, thecable headend, the wireless switchingstation, or other equivalent centralizedfacility) to an Internet point of presence.The Middle Mile includes, among otherthings, the centralized facilities and allof the equipment in those facilities,except for any equipment that wouldqualify as part of a Last Mile componentas defined in this NOFA.

Middle Mile service area means theproject service area, composed of one ormore contiguous Census block groups ortracts, where the applicant is requestingBTOP funds to provide broadbandservice from one or more centralizedfacilities, (i.e., the central office, thecable headend, the wireless switchingstation, or other equivalent centralizedfacility) to an Internet point of presence.

Pre-application expense means anyreasonable expense incurred after therelease of this NOFA up to the issuanceof the grant award from NTIA to preparean application. These expenses includeengineering costs, accountant or otherconsultant fees, and costs related todeveloping the proposal. Lobbying costsand contingency fees are not includedas pre-application expenses.

Proposed funded service area meansthe total service area of a CCI projectwhere broadband service will beprovided.

Public computer centermeans a place,including but not limited to communitycolleges, libraries, schools, youthcenters, employment service centers,Native American chapter houses,community centers, senior centers,assistive technology centers for peoplewith disabilities, community healthcenters, and Neighborhood NetworkCenters in public housingdevelopments, that provide broadband

access to the general public or a specificvulnerable population, such as low-income, unemployed, aged, children,minorities, and people with disabilities.

Recipientmeans any entity thatreceives Recovery Act funds directlyfrom the Federal government (includingRecovery Act funds received through agrant) other than an individual. Thisincludes a State that receives RecoveryAct funds.

Recovery Actmeans the AmericanRecovery and Reinvestment Act of 2009,Pub. L. 1115, 123 Stat. 115 (2009).

Rural area means any area, asconfirmed by the latest decennialCensus of the U.S. Census Bureau, thatis not located within: (i) A city, town,or incorporated area that has apopulation of greater than 20,000inhabitants; or (ii) an urbanized areacontiguous and adjacent to a city ortown that has a population of greater

than 50,000 inhabitants. For purposes ofthe definition of rural area, an urbanizedarea means a densely populatedterritory as defined in the latestdecennial Census of the U.S. CensusBureau.

Socially and EconomicallyDisadvantaged Small Business Concernmeans a firm, together with itscontrolling interests and affiliates, withaverage gross revenue not exceeding $40million for the preceding three years,and that meets the definition of asocially and economicallydisadvantaged small business concern

under the Small Business Act.29

State means, for purposes of BTOP, aState or political subdivision thereof,the District of Columbia, or a territory orpossession of the United States.

Sub-recipientmeans an entity thatexpends Recovery Act funds receivedthrough a subaward from a recipient tocarry out a Federal program but does notinclude an individual who is a

beneficiary of such a program.30Tribe means an Indian tribe that has

the meaning given that term in Section4(e) of the Indian Self-Determinationand Education Assistance Act.31

Underserved area means a Last Mileor Middle Mile service area, where atleast one of the following factors is met:(i) No more than 50 percent of thehouseholds in the Last Mile or MiddleMile service area have access tofacilities-based, terrestrial broadbandservice at greater than the minimum

broadband transmission speed (set forthin the definition of broadband above);(ii) no fixed or mobile terrestrial

broadband service provider advertises toresidential end users broadbandtransmission speeds of at least threemegabits per second (Mbps)downstream in the Last Mile or Middle

Mile service area; or (iii) the rate ofterrestrial broadband subscribership forthe Last Mile or Middle Mile servicearea is 40 percent of households or less.



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32See supra note 6.33Recovery Act sec. 6001(d)(2), 123 Stat. at 513.34 Id. Sec. 6001(d)(3), 123 Stat. at 513.

35See 74 FR at 33134 (July 9, 2009).36Recovery Act sec. 6001(e)(1)(C), 123 Stat. at

513; 74 FR at 33110.37See id. sec. 6001(f), 123 Stat. at 514.

An underserved area may includeindividual Census block groups or tractsthat on their own would not beconsidered underserved. Theavailability of or subscribership rates forsatellite broadband service is notconsidered for the purpose ofdetermining whether an area isunderserved.

Unserved area means a Last Mile orMiddle Mile service area where at least90 percent of the households lack accessto facilities-based, terrestrial broadbandservice, either fixed or mobile, at theminimum broadband transmissionspeed (set forth in the definition of

broadband above). An unserved areamay include individual Census blockgroups or tracts that on their own wouldnot be considered unserved. Ahousehold has access to broadbandservice if the household readily cansubscribe to that service upon request.The availability of or subscribership

rates for satellite broadband service isnot considered for the purpose ofdetermining whether an area isunserved.

IV. Award Information

A. General

Approximately $2.6 billion in budgetauthority has been set aside for fundingopportunities under this NOFA.Publication of this NOFA does notobligate NTIA to award any specificproject or obligate all of the availablefunds. Based on Round 1 experience,NTIA expects this grant round to be

very competitive. During Round 1, RUSand NTIA received approximately 2,200applications collectively requestingnearly $28 billion in Federal funds.

B. Funding Limits

Approximately $2.6 billion isavailable to be awarded under thisNOFA, which NTIA anticipates will beallocated in the following categories:

a. Approximately $2.35 billion will bemade available for CCI projects;

b. At least $150 million will be madeavailable for PCC projects; and

c. At least $100 million will be madeavailable for SBA projects.

C. Repooling

Subject to the statutory thresholds setforth in the Recovery Act, NTIA retainsthe discretion to divert funds from onecategory of projects to another.

D. Unused Funds

Funds remaining from the initialround of funding due to BTOP fundingpriorities or any other reason, andunused funds not awarded under theBroadband Mapping Program, may beused to augment the BTOP funding

categories established above.32 NTIAreserves the right to reopen theapplication window or releasesubsequent NOFAs to ensure that allfunds are awarded by September 30,2010.

E. Award Amount

Given NTIAs Round 1 experience,

NTIA expects to make awards withinthe following funding ranges. Theseranges are not required minimums andmaximums, but applicants requestingamounts for projects outside of theseranges must provide a reasonedexplanation for the variance in theirproject size.

CCI: $5 million$150 millionPCC: $500,000$15 millionSBA: $500,000$15 million

F. Award Period

All awards under BTOP must be madeno later than September 30, 2010.33

While the completion time will varydepending on the complexity of theproject, grant recipients mustsubstantially complete projectssupported by this Program no later thantwo years, and projects must be fullycompleted no later than three years,following the date of issuance of thegrant award.34

G. Type of Funding Instrument

The funding instrument will be agrant.

V. Eligibility Information for BTOP

Applicants must satisfy the eligibility

requirements set forth below in SectionsV.A. through V.C. to qualify for funding.Applicants failing to comply with theserequirements will not be considered foran award.

A. Eligible Entities

1. Applicant Organization

The following entities are eligible toapply for funding:

a. States, local governments, or anyagency, subdivision, instrumentality, orpolitical subdivision thereof;

b. The District of Columbia;c. A territory or possession of the

United States;d. An Indian tribe (as defined in

Section 4 of the Indian Self-Determination and EducationAssistance Act (25 U.S.C. 450b));

e. A native Hawaiian organization;f. A non-profit foundation, a non-

profit corporation, a non-profitinstitution, or a non-profit association;

g. Other non-profit entities;

h. For-profit corporations;i. Limited liability companies; andj. Cooperative or mutual

organizations.

2. BTOP Public Interest Finding

Section 6001(e)(1)(C) of the RecoveryAct authorizes the Assistant Secretary tofind by rule that it is in the public

interest for any entity not otherwiseencompassed by Section 6001(e)(1) to beeligible for a BTOP grant to the extentthat such finding will promote thepurposes of BTOP in a technologyneutral manner. Consistent with therationale set forth in the First NOFA,35the Assistant Secretary found it to be inthe public interest to permit for-profitcorporations and non-profit entities (nototherwise encompassed by Section6001(e)(1)(B)) that are willing topromote the goals of the Recovery Actand comply with the statutoryrequirements of BTOP to be eligible for

a grant. By adopting this broadapproach, the Assistant Secretaryintended to invite a diverse group ofapplicants to participate in BTOP and toexpand broadband capabilities in atechnology neutral manner.36 NTIA willcontinue to permit these same entities toapply for funding in this next round ofawards.

B. Fully Completed Application

All applications will be evaluatedinitially to ensure that they are fullycomplete, certified, and contain allsupporting documentation.

C. Cost Share/Matching1. Matching Requirement

In general, awardees under BTOP arerequired by statute to provide matchingfunds of at least 20 percent toward thetotal eligible costs of the project unlessthe Assistant Secretary grants a waiver.For costs to be eligible to meet matchingrequirements, they first must beallowable under the grant program.Eligible cost concepts are discussed inmore detail in Section V.E. of thisNOFA. Applicants must document intheir application their capacity toprovide matching funds. NTIA will

provide up to 80 percent of the totaleligible costs of the project, unless theapplicant petitions the AssistantSecretary for a waiver of the matchingrequirement and that waiver is granted

based on the applicants demonstrationof financial need, as discussed below.37

Generally, Federal funds may not beused as a cost match except as provided



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38See Uniform Administrative Requirements forGrants and Agreements with Institutions of HigherEducation, Hospitals, Other Nonprofit, andCommercial Organizations, 15 CFR 14.23(a)(5); seealso Uniform Administrative Requirements forGrants and Cooperative Agreements to State andLocal Governments, 24 CFR 24.24(b)(1).

39See 15 CFR 14.23(a), 24.24(a).40See supra Section II.C.4.

41See supra note 23.42Nothing herein shall be construed to affect the

jurisdiction of the FCC with respect to such matters.

by Federal statute.38 In-kindcontributions, including third party in-kind contributions, are non-cashdonations to a project that may counttoward satisfying the non-Federalmatching requirement of a projects total

budgeted costs. In-kind contributionsmust be allowable project expenses.Such contributions may be accepted as

part of an applicants matching costswhen such contributions meet certaincriteria.39

Applicants that propose to provide acost match that is all cash will be givenadditional favorable consideration inthe application review process.Additionally, applicants will be givenfavorable consideration in the selectionprocess by proposing to contribute anon-Federal cost match that equals orexceeds 30 percent of the total eligiblecosts of the projects. CCI applicants arestrongly encouraged to not request moreFederal funding than they require to

make the project financially feasible andsustainable.40

2. Petition for Waiver

In requesting a waiver of the matchingrequirement, an applicant should fullyexplain and document its inability toprovide the required 20 percentmatching share of the eligible costs ofthe proposed project. In demonstratingfinancial need, the applicant shouldsubmit: (1) Documents that include theapplicants assets, liabilities, operatingexpenses, and revenues from anyexisting operations; (2) denial offunding from a public or private lending

institution; or (3) any other documentsthat demonstrate financial need. Merestatements of financial need withoutsupporting documentation will not beviewed favorably. The petition forwaiver and documentation must be setforth clearly in the application. TheAssistant Secretary will evaluate theinformation provided in support of thepetition and may increase the Federalshare if financial need is demonstrated.

D. General Program Requirements

1. Timely Completion

Applicants must demonstrate that the

project can be substantially completedwithin two years of the start date of thegrant award and fully completed nolater than three years following the dateof issuance of the grant award. A BTOP

project is considered substantiallycomplete when a grantee has met 67percent of the project milestones andreceived 67 percent of its award funds.In evaluating compliance with thisfactor, NTIA will consider the plannedstart date of the project; thereasonableness of the project timelineand associated milestones; whether the

applicant will be able to secure alllicenses, franchises, and regulatoryapprovals required to complete theproject; whether the applicant will beable to meet all environmentalrequirements; and whether the requiredcontractors and vendors necessary toimplement the project are prepared toenter into contracts as soon as the fundsare made available.

In view of the urgent need foradditional economic stimulus, however,NTIA strongly encourages applicants tofully complete their projects within thetwo-year time period from the date of

issuance of the award.2. Demonstration That Project CouldNot Be Implemented But For FederalGrant Assistance

Grant applicants must providedocumentation that the project wouldnot have been implemented during thegrant period without Federal grantassistance.41 This documentation mayconsist of, but is not limited to, suchitems as a denial of funding from apublic or private lending institution, acurrent fiscal year budget that shows thelack of available revenue options forfunding the project, or a business case

that demonstrates that the project wouldnot be economically feasible withoutgrant financing.

3. Additional Requirements Applicableto Comprehensive CommunityInfrastructure Applicants

a. Broadband Service

All CCI applicants must propose tooffer service meeting the definition of

broadband as defined in Section III.

b. Nondiscrimination andInterconnection

All CCI applicants must commit to the

following Nondiscrimination andInterconnection Obligations: 42(i) Adhere to the principles contained inthe FCCs Internet Policy Statement(FCC 05151, adopted August 5, 2005)or any subsequent ruling or statement;(ii) not favor any lawful Internetapplications and content over others;(iii) display any network managementpolicies in a prominent location on the

service providers Web page andprovide notice to customers of changesto these policies (awardees mustdescribe any business practices ortechnical mechanisms they employ,other than standard best efforts Internetdelivery, to allocate capacity;differentiate among applications,providers, or sources; limit usage; and

manage illegal or harmful content); (iv)connect to the public Internet directly orindirectly, such that the project is not anentirely private closed network; and (v)offer interconnection, where technicallyfeasible without exceeding current orreasonably anticipated capacitylimitations, at reasonable rates andterms to be negotiated with requestingparties. This includes both the ability toconnect to the public Internet andphysical interconnection for theexchange of traffic. Applicants mustdisclose their proposed interconnection,nondiscrimination, and network

management practices with theapplication.All these requirements shall be

subject to the needs of law enforcementand reasonable network management.Thus, awardees may employ generallyaccepted technical measures to provideacceptable service levels to allcustomers, such as caching (includingcontent delivery networks) andapplication-neutral bandwidthallocation, as well as measures toaddress spam, denial of service attacks,illegal content, and other harmfulactivities. In evaluating thereasonableness of network management

techniques, NTIA will be guided by anyapplicable rules or findings established

by the FCC, whether by rulemaking oradjudication.

In addition to providing the requiredconnection to the Internet, awardeesmay offer managed services, such astelemedicine, public safetycommunications, distance learning, andvirtual private networks, that useprivate network connections forenhanced quality of service rather thantraversing the public Internet.

An awardee may satisfy therequirement for interconnection by

negotiating in good faith with all partiesmaking bona fide requests. The awardeeand requesting party may negotiateterms such as business arrangements,capacity limits, financial terms, andtechnical conditions forinterconnection. If the awardee andrequesting party cannot reachagreement, they may voluntarily seek aninterpretation by the FCC of any FCCrules implicated in the dispute. If anagreement cannot be reached within 90days, the party requestinginterconnection may notify NTIA in



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43Note that the changes made to this section fromthe First NOFA are meant to clarify, and notchange, applicants obligations. 44See infra Section VII.A.1.

45For example, there is a set of Federal principlesfor determining eligible or allowable costs.Allowability of costs will be determined inaccordance with the cost principles applicable tothe entity incurring the costs. Thus, allowability ofcosts incurred by State, local or Federally-recognized Indian tribal governments is determinedin accordance with the provisions of OMB CircularA87, Cost Principles for State, Local and Indian

Continued

writing of the failure to reachsatisfactory terms with the awardee. The90-day limit is to encourage the partiesto resolve differences throughnegotiation.

With respect to non-discrimination,those who believe an awardee has failedto meet the non-discriminationobligations should first seek action at

the FCC of any FCC rules implicated inthe dispute. If the FCC chooses to takeno action, those seeking recourse maynotify NTIA in writing about the allegedfailure to adhere to commitments of theaward.

These conditions apply to theawardee and will remain in effect forthe life of the awardees Federallyfunded facilities and equipment used inthe project. These conditions will notapply to any existing networkarrangements or to non-awardees usingthe network. Note, however, that theawardee may negotiate contractual

covenants with other broadband serviceproviders engaged to deploy or operatethe network facilities and pass theseconditions through to such providers.Awardees that fail to accept or complywith the terms listed above may beconsidered in default of their grantagreements. NTIA may exercise allavailable remedies in the event of adefault, including suspension of awardpayments or termination of the award.43

c. Last Mile Coverage Obligation

i. Service Obligation

An applicant for a CCI project thatincludes a Last Mile component mustidentify the Last Mile service area(s)selected for the project. There is apresumption that the applicant willprovide service to the entire Last Mileservice area(s).

ii. Petition for Waiver

An applicant may petition for awaiver of the Last Mile CoverageObligation if it provides a reasonedexplanation as to why providing serviceor coverage for the entire Last Mileservice area is extremely burdensomefor the applicant. In consideringwhether providing service or coverage is

extremely burdensome, the applicantmust explain whether there are anylegal, technical, or financialimpediments to covering each Census

block group or tract. Mere statementsregarding the burden to serve an areawithout supporting documentation willnot be viewed favorably. The petitionfor waiver and documentation must beset forth clearly in the application.

Applicants may be permitted to serveless than an entire Census block groupor tract under certain conditions. Forexample, an applicant might request to

be relieved of this requirement if theCensus block group or tract exceeds 100square miles or more or is larger thanthe applicants authorized operatingterritory (e.g., it splits a rural incumbent

local exchange carriers (ILECs) studyarea or exceeds the boundaries of awireless carriers licensed territory).Where applicable, an applicant seekinga waiver also should includeinformation regarding the characteristicsof the Last Mile service area (e.g., datashowing whether broadband servicesalready are available in the proposedunserved territory by more than oneservice provider or informationregarding terrain, acreage, population,etc.) and costs (e.g., pro forma financialprojections or estimated applicant cost/

burden to provide broadband service to

the remainder of the area).d. Announcement of Proposed FundedService Areas

In the interests of promotingtransparency and strengthening theselection process, NTIA will post anannouncement identifying each CCIapplication it has received, along witha list of the Census block groups ortracts that each infrastructure applicanthas proposed to serve through itsproject, at http://www.broadbandusa.gov. The posting ofthis announcement will provide existing

broadband service providers with a 15-

day window voluntarily to submit toNTIA information about the broadbandservices they currently offer in theirrespective service territories by Census

block group or tract. If an existingbroadband service provider submits aresponse outside of the 15-day period,NTIA may not consider this informationin its evaluation of an applicants LastMile or Middle Mile service area(s).

NTIA will consider the comments ofexisting broadband service providers asa factor in its evaluation of theapplicants Last Mile or Middle Mileservice area(s) 44 provided that they

include the following information, someof which will be made public: (1) Thename of the company providinginformation on its broadband serviceofferings; (2) a summary describing theinformation the provider has presentedto NTIA; (3) the number of householdsand businesses that have access to

broadband service in the providersservice territory by Census block groupor tract; (4) the type of broadbandservices the provider offers in its service

territory by Census block group or tractand the technology used to providethose services, including, for wirelesscarriers, the spectrum that is used;(5) the prices at which the broadbandservices are offered; (6) the speed of the

broadband services that are offered; (7)the number of subscribers that theprovider currently has for each of the

broadband services it offers in itsservice territory by Census block groupor tract; and (8) optionally, a list of theproviders Points of Presence (POPs) inor near Census block groups or tractslisted by the announcement.

The information submitted by anexisting broadband service providerrelating to items (3) through (8)enumerated above will be treated asproprietary and confidential to theextent permitted under applicable law.The information described in items (1)and (2) above, which includes theidentity of the company submitting

information and a summary of itsresponse, will be made publiclyavailable. NTIA will post at http://www.broadbandusa.gova list of theCensus block groups or tracts in whichexisting broadband service providershave indicated that they provide

broadband service. NTIA may considerany information submitted by existing

broadband service providers as relevantto its prioritization and review of CCIapplications and as part of its evaluationof the merits of a highly qualified CCIapplication. NTIA will contact theapplicant as necessary for additionalinformation to evaluate the unserved orunderserved status of its Last Mile orMiddle Mile service area(s), ifapplicable, and may take other data,such as existing State broadband mapsand FCC Form 477 data, into accountduring this examination.

E. Funding RestrictionsEligible andIneligible Costs

1. General

Grant funds that NTIA awards maynot necessarily be used to pay for all ofthe costs that the grant recipient incursin carrying out the project. Specifically,grant funds must be used only to pay foreligible costs. Eligible costs areconsistent with the cost principlesidentified in the applicable OMBcirculars 45 and in the grant programs



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Tribal Governments. The allowability of costsincurred by nonprofit organizations is determinedin accordance with the provisions of OMB CircularA122, Cost Principles for Non-ProfitOrganizations. The allowability of costs incurredby institutions of higher education is determined inaccordance with the provisions of OMB Circular A21, Cost Principles for Educational Institutions. The allowability of costs incurred by hospitals is

determined in accordance with the provisions ofAppendix E of 45 CFR part 74, Principles forDetermining Costs Applicable to Research andDevelopment under Grants and Contracts withHospitals. The allowability of costs incurred bycommercial organizations and those nonprofitorganizations listed in Attachment C to Circular A122 is determined in accordance with theprovisions of the Federal Acquisition Regulation(FAR) at 48 CFR part. 31. See 15 CFR 14.27 and24.22 (governing the Department of Commercesimplementation of OMB requirements).

46BTOP CCI applicants and PCC applicants willbe directed to revise SF424A (for non-constructionprojects) or SF424C (for construction projects).SBA applicants will be directed to revise SF424A(for non-construction projects).

47See http://oam.ocs.doc.gov/docs/DOC%20IDC%20Ext%20Policy.v6.doc.

48These facilities and equipment may include, forexample, but are not limited to, the costs associatedwith complying with all applicable legalrequirements, such as the CommunicationsAssistance for Law Enforcement Act (CALEA). Seeinfra Section X.P.

authorizing legislation. In addition,costs must be reasonable, allocable,necessary to the project, and conform toGAAP. For CCI projects, eligible costsare generally capital expenses, and notoperating expenses. An applicantproposing to use any portion of thegrant funds for any ineligible cost will

be instructed to revise its proposed

budget to remove such costs prior to theaward of a grant.46 A more detaileddiscussion of the eligible and ineligiblecosts that are applicable to each BTOPproject category is set forth in thefollowing sections.

In general, a project will incur bothdirect and indirect costs. Direct andindirect costs may be reimbursed fromgrant funds provided that they fallwithin the approved eligible costcategories discussed below.

a. Direct Costs of a BTOP Project

Direct costs are those that are directlyrelated and traceable to the cost of theproject being supported. Direct costs ofa project may be charged to the awardif they are allowable costs and areincluded within approved budgetcategories.

b. Indirect Costs of a BTOP Project

NTIA has the discretion to considerindirect costs as eligible expenses underBTOP. For CCI projects, reasonableindirect costs associated with theconstruction, deployment, orinstallation of facilities and equipmentused to provide broadband service asdescribed in Section V.E.2. will be

considered eligible provided that theyare included as a line item in theapplicants budget and the applicant hasestablished, or commits to apply for, anapproved indirect cost rate. For PCC andSBA projects, reasonable indirect costsassociated with eligible project activities

as detailed in Sections V.E.3. and V.E.4.will be considered eligible costsprovided they are included as a lineitem in the applicants budget and theapplicant has established, or commits toapply for, an approved indirect costrate. The process for establishing anindirect cost rate with the DOC isdescribed in a document entitled

General Indirect Cost Rate ProgramGuidelines for Grantee Organizationsand can be found on the Department ofCommerce Web site.47 Applicants thatdo not have an approved indirect costrate will have 90 days from the awardstart date to apply to have a rateestablished.

2. Eligible and Ineligible Costs for BTOPComprehensive CommunityInfrastructure Projects

a. Eligible Costs for ComprehensiveCommunity Infrastructure Projects

Grant funds may be used to pay for

the following expenses:i. To fund the construction or

improvement of all facilities required toprovide broadband service; 48

ii. To fund the cost of long-term leases(for terms greater than one year) offacilities required to provide broadbandservice, including indefeasible right-of-use (IRU) agreements;

iii. To fund reasonable pre-application expenses in an amount notto exceed five percent of the award. Pre-application expenses, which includeexpenses related to preparing anapplication, may be reimbursed if they

are incurred after the publication date ofthis NOFA and prior to the date ofissuance of the grant award from NTIA,except that lobbying costs andcontingency fees are not reimbursablefrom BTOP funds;

iv. To fund reasonable indirect costsconsistent with the principles outlinedin Section V.E.1. of this NOFA; and

v. Undertaking such other projectsand activities as the Assistant Secretaryfinds to be consistent with the purposesfor which the Program is established.

b. Ineligible Costs for ComprehensiveCommunity Infrastructure Projects

Grant funds may not be used for anyof the following purposes:

i. To fund operating expenses of theapplicant;

ii. To fund costs incurred prior to thedate on which the application is

submitted, with the exception of eligiblepre-application expenses;

iii. To fund an acquisition of anaffiliate, including the acquisition of thestock of an affiliate;

iv. To fund the purchase or lease ofany vehicle other than those usedprimarily in construction or systemimprovements;

v. To fund the merger orconsolidation of entities; orvi. To fund costs incurred in

acquiring spectrum as part of an FCCauction or in a secondary marketacquisition.

3. Eligible and Ineligible Costs forPublic Computer Center Projects

a. Eligible Costs for Public ComputerCenter Projects

Projects under this category are aimedat expanding broadband access andcapacity at community anchorinstitutions, organizations serving

vulnerable populations, or job-creatingstrategic facilities located in State- orFederally-designated economicdevelopment areas as well asstimulating broadband demand,economic growth, and job creation.Grantees may use BTOP funding toexpand public computer center capacity

by:i. Acquiring broadband-related

equipment, instrumentation, networkingcapability, hardware and software, anddigital network technology for

broadband services, including thepurchase of word processing software,computer peripherals, such as mice and

printers, and computer maintenanceservices and virus-protection software;

ii. Developing and providing training,education, support, and awarenessprograms or web-based resources,including reasonable compensation forqualified instructors, technicians,managers, and other employeesessential for these types of programs;

iii. Facilitating access to broadbandservices, including, but not limited to,making public computer centersaccessible to the disabled;

iv. Installing or upgrading broadbandfacilities on a one-time, capital

improvement, basis in order to increasebroadband capacity;v. Constructing, acquiring, or leasing

a new facility, provided that theapplicant explains why it is necessary toconstruct, acquire, or lease a newfacility to facilitate public access to

broadband services or expand computercenter capacity;

vi. Funding reasonable indirect costsconsistent with the principles outlinedin Section V.E.1. of this NOFA;

vii. Undertaking such other projectsand activities as the Assistant Secretary



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4915 CFR 14.24(b), 24.25(g).5015 CFR 14.2(aa), 24.25(b). Program income

includes, among other things, income from fees forservices performed, from the use or rental of realor personal property acquired with grant funds, andfrom the sale of commodities or items fabricatedunder a grant agreement. 15 CFR 14.2(aa), 24.25(a).In general, costs incident to the generation ofprogram income may be deducted from grossincome to determine program income, providedthese costs have not been charged to the award. 15CFR 14.25(f), 24.25(c).

5115 CFR 14.25(h), 24.25(h).52See, e.g., 2 CFR 215.24; 15 CFR 14.24, 24.25.53 To enable timeliness of awards, agencies

should engage in aggressive outreach to potentialapplicants to begin application planning activities,including the process of Central ContractorRegistration (CCR) and obtaining a Dun andBradstreet Universal Numbering System (DUNS)number. Updating Implementing Guidance for theAmerican Recovery and Reinvestment Act of 2009(OMB M0915 April 3, 2009), available athttp://www.whitehouse.gov/omb/assets/memoranda_fy2009/m09-15.pdf.

finds to be consistent with the purposesfor which the Program is established;and

viii. Paying for reasonable pre-application expenses in an amount notto exceed five percent of the award. Pre-application expenses, which includeexpenses related to preparing anapplication, may be reimbursed if theyare incurred after the publication date ofthis NOFA and prior to the date ofissuance of the grant award from NTIA,except that lobbying costs andcontingency fees are not reimbursablefrom BTOP funds.

While some of the costs associatedwith the activities enumerated abovemay be properly classified as operatingexpenses, an applicant should describein its application how it intends tocover the operating expenses of theproject after the grant period expires.

b. Ineligible Costs for Public Computer

Center ProjectsBTOP grant funds may not be used to

fund purchases that are not usedpredominantly for expanding publicaccess to broadband service orenhancing broadband capacity at publiccomputer center locations.

4. Eligible and Ineligible Costs forSustainable Broadband AdoptionProjects

a. Eligible Costs for SustainableBroadband Adoption Projects

Projects under this category are aimedat providing broadband education,awareness, training, access, equipment,and support in order to stimulatesustainable adoption of broadbandservices by individuals, households,and community anchor institutions. Inthis context, sustainable meansadoption (i.e., subscription to

broadband service) that the consumer orinstitution can and will continue to payfor after the award period. Grantees mayuse BTOP funding for innovativeprograms that encourage sustainableadoption of broadband services by:

i. Acquiring broadband-relatedequipment, instrumentation, networking

capability, hardware and software, anddigital network technology for

broadband services;ii. Developing and providing training,

education, support, and awarenessprograms, as well as web-based contentthat is incidental to the programspurposes, and includes reasonablecompensation for qualified instructorsfor these types of programs;

iii. Conducting broadband-relatedpublic education, outreach, support,and awareness campaigns;

iv. Implementing programs tofacilitate greater access to broadbandservice, devices, and equipment;

v. Funding reasonable indirect costsconsistent with the principles outlinedin Section V.E.1. of this NOFA;

vi. Undertaking such other projectsand activities as the Assistant Secretaryfinds to be consistent with the purposes

for which the Program is established;and

vii. Paying for reasonable pre-application expenses in an amount notto exceed five percent of the award. Pre-application expenses, which includeexpenses related to preparing anapplication, may be reimbursed if theyare incurred after the publication date ofthis NOFA and prior to the date ofissuance of the grant award from NTIA,except that lobbying costs andcontingency fees are not reimbursablefrom BTOP funds.

While some of the costs associated

with the activities enumerated abovemay be properly classified as operatingexpenses, an applicant should describein its application how it intends tocover the operating expenses of theproject after the grant period expires, ifappropriate.

b. Ineligible Costs for SustainableBroadband Adoption Projects

BTOP grant funds may not be used forexpenses or purchases that are not usedpredominantly for the provision of

broadband education, awareness,training, access, equipment, andsupport. Additionally, costs associated

with constructing or leasing broadbandfacilities and infrastructure are noteligible.

F. Use of Program Income

Grantees are required to account forany Program income directly generated

by projects financed in whole or in partwith Federal funds. Given the RecoveryActs objectives to spur job creation andstimulate long-term economic growthand opportunity, projects funded byBTOP grants are expected todemonstrate convincingly the ability to

be sustained beyond the funding period.

While grant funds are intended to coverthe capital costs of a project as part ofthe Recovery Acts effort to stimulatethe economy, grant recipients for allgrant program