The American Recovery and Reinvestment Act (Recovery Act) of 2009 authorizes billions for the National Telecommunications and Information Administration in the Department of Commerce and Department of Agriculture's Rural Utilities Service to create new programs to accelerate the deployment and use of broadband in the US.
Broadband Grant Programs
Per Office of Management and Budget Guidance, the NTIA and RUS must go beyond standard practices while planning competitive grants under the Recovery Act.
1) Objectives and Evaluation Criteria: They are to structure grants to result in meaningful and measurable outcomes that are consistent with agency plans and that promote the goals of the Recovery Act. The specific goals of the law are to:
- preserve and create jobs and promote economic recovery,
- assist those most impacted by the recession,
- provide investments needed to increase economic efficiency by spurring technological advances in science and health,
- invest in transportation, environmental protection, and other infrastructure that will provide long-term economic benefits, and
- stabilize State and local government budgets, in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases
Agencies are instructed to consider weighting selection criteria to favor applicants for assistance with demonstrated ability to deliver programmatic result and accountability objectives included in Recovery Act.
The evaluation criteria for awards should include those that bear on the measurement and likelihood of achieving these outcomes, such as, jobs creation and preservation.
2) Competition: The Recovery Act calls on agencies to commence expenditures and activities as quickly as possible consistent with prudent management. NTIA and RUS are expected to follow the same laws, principles, procedures, and practices in awarding discretionary grants with Recovery Act funds as they do with other funds. NTIA and RUS are to review their internal policies with a goal towards promoting competition to the maximum extent practicable. (In conducting this review, agencies are allowed to consider the appropriateness of limited competitions among existing high-performing projects versus full and open competitions and formula allocations.)
3) Existing Grants: NTIA and RUS may consider obligating funds provided under the Recovery Act on an existing grant, including, but not limited to, a continuation or renewal grant -- but supplements to existing agreements are not recommended.
4) Timeliness of Awards: NTIA and RUS need to assess existing processes for awarding formula allocations and announcing, evaluating and awarding discretionary grant opportunities to comport with the objective to make awards timely.
To enable timeliness of awards, NTIA and RUS are to engage in aggressive outreach to potential applicants to begin application planning activities.
NTIA must award grants by September 30, 2010. All projects must be completed by Sept 30, 2012.
5) Coordination Activities: NTIA and RUS are to coordinate with agencies with similar grant programs to determine if there are ways to consolidate resources and efforts during the planning, award, and post-award stages of the grant cycle.
6) Oversight: NTIA and RUS must be able to evaluate and demonstrate the effectiveness of standard monitoring and oversight practices.
- Performance Management and Accountability: NTIA and RUS must adapt current performance evaluation and review processes to include the ability to report periodically on completion status of the program or activity, and program and economic outcomes, consistent with Recovery Act requirements. (In consultation with the Inspectors General, they will establish procedures to validate the accuracy of information submitted) on a statistical basis and/or risk based approach as approved by OMB.)
- Internal Controls Assessment: NTIA and RUS must use appropriate internal control assessments to assess the risk of program waste, fraud, and/or abuse.
7) Terms and Conditions:
When the NTIA issues a request for proposals for these grants, it is to publish non-discrimination and network interconnection obligations that adhere to the Federal Communications Commission's August 2005 broadband policy statement (collectively, these principles as often referred to as Network Neutrality):
- To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to access the lawful Internet content of their choice.
- To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to run applications and use services of their choice, subject to the needs of law enforcement.
- To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to connect their choice of legal devices that do not harm the network
- To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to competition among network providers, application and service providers, and content providers
Grant winners must submit quarterly reports on their progress and projects that do not demonstrate sufficient progress or are wasteful will lose their grants.
Structuring RUS Loan Programs
Planning for loan and loan guarantee awards under the Recovery Act is critical to:
- Mitigate performance and credit risk;
- Define program requirements that deliver meaningful and measurable outcomes consistent with agency plans and the goals of Recovery Act;
- Obtain maximum practicable competition consistent with program authorizing legislation;
- Expeditiously award financial assistance using available streamlining flexibilities;
- Apply sufficient and adequately trained workforce to responsibly evaluate, award and monitor loans and loan guarantees;
- Ensure adequate government personnel is available to perform inherently governmental functions during the loan award and credit management cycles;
- Provide appropriate agency oversight at critical decision points; and
- Make information available to the public, consistent with the Recovery Act.
Key considerations during the planning process include the following areas:
1) Compliance with Statutory Provisions: The RUS should evaluate specific program provisions, and incorporate necessary information collection and other requirements into opportunity notices, applications, award agreements, and processes to ensure adequate oversight and management, and compliance with any unique provisions under the Recovery Act.
2) Competition: Although the law calls on agencies to commence expenditures and activities as quickly as possible consistent with prudent management, program authorizing language, (with possible clarification provided by the Recovery Act), agency regulations, and other documentation specify the competition requirements for awards. The RUS will enforce competition requirements consistent with the provisions of all applicable statutory, regulatory, and other requirements.
3) Financial Assistance Objectives and Evaluation Criteria: The RUS will develop specific performance goals and target measures prior to developing a funding opportunity notice. The RUS must obtain sufficient information from applicants, to evaluate the degree to which the loan or loan guarantee would meet the desired program outcomes. Where competition is permitted by program authorization, the RUS should publish in the opportunity notice, criteria for determining the best use of funds for each opportunity notice and formalize the procedures to evaluate applications.
4) Performance Measure, Accountability, and Reporting: The RUS will also establish systems to capture, validate, report, and evaluate information regarding the loan and loan guarantee award, from the borrowers, the lenders or other relevant sources, to periodically assess and report performance against expected results consistent with Recovery Act reporting requirements. Such systems or processes include development of a standard format for award recipients to report summary information on the award and use of funds, and making such information available on a public website. Reviews of spending shall be designed to proactively identify and minimize risks.
5) Outreach: The RUS use the GovLoans.gov web portal in conjunction with agency websites and existing agency marketing and outreach initiatives to assure public awareness of loan availability under the Recovery Act. Notices are to include performance measurement, data collection, and loan and loan guarantee award selection and evaluation criteria. The notices are also supposed to address:
- Statement of Expected Benefit/Outcome;
- Face Value of Loan or Loan Guarantee;
- Subsidy cost to Government of the Loan or Loan Guarantee;
- Congressional District;
- Key Performance Measures;
- Competitive Award Process Determination; and
- Justification of Non-Competitive Selection Process, if appropriate.
6) Oversight: The RUS must be prepared to evaluate and demonstrate the effectiveness of standard monitoring and oversight practices.
- Performance Management and Accountability: The RUS must adapt current performance evaluation and review processes to include the ability to report periodically on completion status of the program or activity, and program and economic outcomes, consistent with Recovery Act requirements. (In consultation with the Inspectors General, the RUS will establish procedures to validate the accuracy of information submitted.)
- Internal Controls Assessment: The RUS must use appropriate internal control assessments to assess the risk of program waste, fraud, and/or abuse. The RUS must have defined strategies to prevent or timely detect waste, fraud, or abuse, developed with input from the Inspector General for the agency.
7) Terms and Conditions: The RUS must ensure receipt of funds is made contingent on recipients meeting reporting requirements.
- At least 75% of the area being served must be rural without sufficient access to high speed broadband service to facilitate economic development;
- Priority is to be given to projects applications for:
- broadband systems that deliver end users a choice of more than one service provider,
- projects that provide service to the highest proportion of rural residents who do not have access to broadband service,
- projects that include applications from current or former RUS participants,
- projects that will be fully-funded if they get the federal award, and
- projects that can be started quickly and completed if funded.
- If a project is receiving funding from Dept of Agriculture, the project must not also B-TOP funding.