Feds Announce Application Process for Rural Broadband Experiments

by Stinson Leonard Street

On August 19th, the Federal Communications Commission released a public notice detailing the application process for entities interested in participating in the rural broadband experiments. The notice outlines specific application guidelines, procedures, and mechanisms the FCC will use to determine which applicants may participate in the experiments.

Prior to the August 19th notice, the Rural Broadband Experiments Order established a budget of $100 million to fund the experiments and defined three separate funding categories: (i) $75 million for high-cost areas offering broadband services at 25 megabits per second downstream and 5 megabits per second upstream; (ii) $15 million for projects in high-cost areas proposing to offer broadband service of 10 megabits per second downstream and 1 megabit per second upstream; and (iii) $10 million for projects proposing to offer broadband in extremely high-cost areas. The FCC concluded that funding will be awarded on a cost-effective basis.

The application requirements for entities wishing to participate in the rural broadband experiments consists of two parts: (i) applicants must certify as to its qualifications on FCC Form 5610; and (ii) each winning bidder must file additional financial and technical information on FCC form 5620. The purpose of these filings is to give the FCC an opportunity to conduct a further review of the applicant's capabilities of completing the proposed project.

Particularly, the formal application must contain: 

  • Applicant information; 
  • Disclosure of bidding arrangements; 
  • Ownership disclosure; 
  • Specific project information; 
  • A complete bid form uploaded to the FCC; 
  • Bid project identifiers; 
  • The entities FCC registration number; 
  • The category for which it seeks funding; 
  • Identification of census blocks; 
  • The total support amount requested; 
  • The total eligible locations to be served; 
  • Any extremely high-cost locations to be served; 
  • A descriptive date form to the FCC; and 
  •  A certification if applicant is already designated as an Eligible Telecommunications Carrier (ETC) or if applicant will seek designation if awarded the bid.

Formal applications for participation in the rural broadband experiments are due on or before October 14, 2014. Applications can only be filed over the Internet using the FCC Auction System.

The FCC will review each application and determine if the applicant demonstrates the technical and financial qualifications to complete its proposed project within the required timeframe. Importantly, applicants must obtain a letter of credit in the amount of the winning bid and certify to the FCC its ETC designation. Once the FCC determines that the winning bidder is financially and technically capable of completing its project, applicant must submit an irrevocable stand-by original letter of credit issued and signed by the issuing bank and provide an opinion letter from legal counsel regarding the letter of credit or its proceeds treatment in bankruptcy court. Again, only the most cost-effective proposals from each category will be awarded funding. The FCC will announce all winning bids by public notice after the October 14, 2014, deadline.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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