Implementation of Telecommunications Provisions of the Agricultural Improvement Act of 2018

CourtRural Utilities Service
Citation87 FR 15031
Published date17 March 2022
Record Number2022-05496
Federal Register, Volume 87 Issue 52 (Thursday, March 17, 2022)
[Federal Register Volume 87, Number 52 (Thursday, March 17, 2022)]
                [Rules and Regulations]
                [Pages 15031-15032]
                From the Federal Register Online via the Government Publishing Office []
                [FR Doc No: 2022-05496]
                Rules and Regulations
                 Federal Register
                This section of the FEDERAL REGISTER contains regulatory documents
                having general applicability and legal effect, most of which are keyed
                to and codified in the Code of Federal Regulations, which is published
                under 50 titles pursuant to 44 U.S.C. 1510.
                The Code of Federal Regulations is sold by the Superintendent of Documents.
                Federal Register / Vol. 87, No. 52 / Thursday, March 17, 2022 / Rules
                and Regulations
                [[Page 15031]]
                Rural Utilities Service
                [Docket Number RUS-20-TELECOM-0044]
                7 CFR Parts 1735 and 1737
                RIN 0572-AC48
                Implementation of Telecommunications Provisions of the
                Agricultural Improvement Act of 2018
                AGENCY: Rural Utilities Service, USDA.
                ACTION: Final rule; confirmation.
                SUMMARY: The Rural Utilities Service, a Rural Development agency of the
                United States Department of Agriculture (USDA), hereinafter referred to
                as ``RUS'' or ``the Agency,'' published in the Federal Register on
                September 10, 2021, a final rule with request for comments. This
                document presents the opportunity for the Agency to provide its
                responses to the public comments received on the final rule and to
                confirm the final rule as published.
                DATES: March 17, 2022.
                FOR FURTHER INFORMATION CONTACT: Laurel Leverrier, Assistant
                Administrator, Telecommunications Program, Rural Utilities Service,
                U.S. Department of Agriculture, email: [email protected],
                telephone (202) 720-9556.
                SUPPLEMENTARY INFORMATION: The RUS published a final rule with request
                for comments in the Federal Register on September 10, 2021 at 86 FR
                50604. The final rule modified existing regulations to implement
                statutory provisions of the Agriculture Improvement Act of 2018 (2018
                Farm Bill).
                 The comment period on the final rule closed November 9, 2021.
                Comments were received from five respondents. The comments provided and
                Agency responses are as follows:
                Respondent One
                 Respondent one is an individual that offered general comments on
                the importance of connectivity and how it can benefit rural areas and
                 Agency Response: Thank you for your comment.
                Respondent Two
                 Respondent two is a small company located in Kansas that started up
                specifically to offer broadband service with a grant through a COVID-19
                response program. The company had to take on additional debt in order
                to expand their service and have provided general comments on their
                experience with providing service to a small area and the challenges
                they continue to face. They ``would like to see refinancing limits to
                100 percent loans and 50 percent for non-RUS loans.'' They express the
                need for easier access to capital for network upgrades.
                 Agency Response: Thank you for your comment.
                Respondent Three
                 Respondent three is an organization that represents its member
                telecommunications companies and advocates on their behalf. They
                provided a general discussion on the changes made to the regulation and
                offered the following: ``The proposed rules for implementing the
                changes to the Rural Telephone Loan Program represent a good faith and
                commendable effort to carry out the will of Congress expressed in the
                2018 Farm Bill, and USDA has the benefit of decades of experience (and
                countless success stories) at RUS in supporting rural telecom and
                coordinating with other federal programs. As RUS begins administering
                the revamped program, however, it will be important to recommit to such
                efforts, including identifying where providers are receiving USF or
                other program support to deploy to at least the RUS broadband standard,
                and limiting future USDA awards in those areas to the recipients of
                support or funding from these other programs instead of duplicating the
                existing network and putting scarce federal resources at risk.''
                 As part of their concern for identifying where existing providers
                are located, they recommended adding to Sec. 1735.12 on nonduplication
                ``that such loan will not results in duplication of lines, facilities,
                or systems that are obligated to be built in the area in question to
                provide reasonably adequate services under other programs administered
                by the Agency or any other federal Agency.''
                 Agency Response: The Agency supports the respondent's comment and
                the Agency meets with other federal agencies that support the
                deployment of broadband facilities on a regular basis. We appreciate
                your suggestion and will keep it under consideration for a future
                change to the regulation. As the Agency works with our other federal
                partners, we will develop an overall strategy that ensures the most
                efficient use of all federal dollars allocated to providing broadband
                Respondent Four
                 Respondent four is an existing Native American RUS borrower that
                has been in operation over 60 years. They have outstanding loans in the
                telecommunications and broadband programs. They ``strongly support the
                included federal rule amendments and urge their expeditious
                implementation by the RUS.'' In support of and relating to these
                changes, the company offered a detailed summary of their existing
                operations and their hard work in providing modern, state-of-the-art
                telecommunications services to its customers. Their broadband
                penetration ``sits at approximately 58 percent and while the company
                understands the importance of making its broadband services more
                affordable, it has been unable to reduce its pricing given financial,
                cost recovery needs. As a small company providing broadband and voice
                services over a large, remote, and thinly populated area, the company
                faces significant cost recovery challenges.'' In recognition of their
                cost recovery and price affordability concerns, they have been in
                discussions with the Agency on extensions, revised loan terms or full
                refinancing options.
                 As to implementation of the final rule and issuance of the
                referenced funding opportunity announcement, ``the borrower urges RUS
                to move swiftly in its process, issuing the required public notice at
                the earliest opportunity. Furthermore, the company requests that the
                RUS in making funds available for refinancing establish a process for
                receiving and reviewing applications that fairly takes into account the
                interest of the company and other service providers.''
                 In its summary, the borrower ``urges the RUS to sufficiently
                clarify within the released Notice of Funding
                [[Page 15032]]
                Opportunity the differences in the informational requirements, review
                processes and the estimated timelines that will apply with respect to
                the RUS review of refinance applications vs. original loan
                applications. Also, given the informational requirements and steps
                necessary for full review and final action by the RUS should not be as
                extensive for refinance applications, the borrower encourages the RUS
                to implement a timeline for its acceptance and review of refinance
                applications that is different than, and much shorter, that the
                timelines will be established for the submittal, review and action on
                applications for new infrastructure loans.''
                 Agency response: The Agency is in the final phase of the funding
                announcement to open the Infrastructure Program to the new refinancing
                opportunities. The funding announcement will include the requirements
                that need to be satisfied to receive the refinancing. Applications will
                be processed as soon as they are submitted.
                Respondent Five
                 Respondent five is a national trade association that represents
                small, rural telecommunications providers across rural America. Many of
                the rural location exchange carriers they represent have a long-
                standing relationship with the Agency going back more than 75 years.
                The respondent ``supports RUS' efforts that streamline the Loan Program
                and eliminate unnecessary requirements so that the Program operates
                more efficiently. In addition, the respondent supports some of the more
                substantive changes made to the Loan Program rules. Specifically,
                creating a minimum retail broadband service speed standard of 25/3 Mbps
                will help ensure rural areas are not left behind more populated areas
                when it comes to broadband service. In addition, broader loan
                restructuring and refinancing authority will allow RUS borrowers to
                take advantage of better interest rates. Finally, the creation of a
                public notice requirement for loan applications will help ensure funds
                are not used to duplicate existing networks; however, RUS should
                strengthen this provision by directly contacting incumbent service
                providers to let them know of a submitted application.''
                 Agency response: The Agency believes that the public notice
                requirements, set out by statute, sufficiently put incumbent service
                providers on notice that an application has been submitted under any
                program at USDA for retail broadband assistance.
                 The Agency did not receive any significant adverse comments during
                the public comment period on the final rule, and therefore confirms the
                rule without change.
                Christopher A. McLean,
                Acting Administrator, Rural Utilities Service.
                [FR Doc. 2022-05496 Filed 3-16-22; 8:45 am]
                BILLING CODE 3410-15-P

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