Funding Categories
For all funding categories, the proposed funded service area must be in an area where 50% of households do not have sufficient access to broadband. For the “Projects serving areas where 90% of households lack sufficient access to broadband” funding category, 90% of households must lack sufficient access to broadband. Applicants must propose to build a network capable of providing 100 megabits per second (Mbps) symmetrical service to all premises in the proposed funded service area at the same time.
Applicants may request funding from one of the following categories:
100% Grant
Up to $150,000,000 is available. The maximum amount that can be requested in an application is $25,000,000. However, to encourage broadband deployment in remote areas, if an applicant provides supporting information that demonstrates that the PFSA(s) is comprised 100 percent of areas classified by the USDA Economic Research Service as Frontier and Remote Area (FAR) Level 4, the applicant may request up to $35,000,000. A GIS layer of FAR Level 4 areas can be found in the ReConnect Program Service Area Map. The minimum amount that can be requested in an application is $100,000.
Applicants must provide a matching contribution equal to at least 25 percent of the cost of the overall project. The applicant must clearly identify the source of the matching funds even if it is to be provided from the applicant’s operating accounts.
Given the cashflow pinches on many telecommunications providers during the COVID pandemic, many previous awardees have requested complying with the matching requirement over time, rather than depositing all matching funds at once in the Pledged Deposit Account (PDA) Because of these extraordinary circumstances, RUS has agreed to modify the grant agreement to permit awardees to deposit the required matching and other required funds in the PDA on a rolling basis. If the matching funds are provided by a third party, a commitment letter from the third party must be submitted indicating that the funds will be available at the closing of the award if approved. The matching contribution can only be used for eligible purposes. If the applicant elects to initiate a loan to satisfy the matching requirement, documentation must be included as part of the application indicating the terms and conditions for the loan and that the grant funded assets cannot be used as collateral for the matching funds loan. The loan must be entered into and funds transferred into the applicant’s accounts by the closing of the award.
For this FOA, the advance of funds for the 100 percent grants will be prorated against the amount of matching funds that are required and the amount of the grant.
100% Grant for Alaska Native Corporations, Tribal Governments, Colonias, Persistent Poverty Areas and Socially Vulnerable Communities
Up to $350,000,000 is available. The maximum amount that can be requested in an application is $25,000,000. However, to encourage broadband deployment in remote areas, if an applicant provides supporting information that demonstrates that the PFSA(s) is comprised 100 percent of areas classified by the USDA Economic Research Service as FAR Level 4, the applicant may request up to $35,000,000. A GIS layer of FAR Level 4 areas can be found in the ReConnect Program Service Area Map. The minimum amount that can be requested in an application is $100,000.
For applications submitted under this funding category that meet one of the following criteria, no matching funds will be required:
- Alaska Native Corporations may submit an application to provide service on land owned by the corporation, as defined in the Alaska Native Claims Settlement Act. Applicants must submit documentation supporting the incorporation.
- Tribal Governments may submit an application to provide service on Tribal Lands; lands held in trust by the United States for Native Americans; lands subject to restrictions on alienation imposed by the United States on Indian Lands; or land that they own, provide services to, or administer. Applicants must submit documentation supporting land ownership, services, or administration.
- Projects where 75 percent of the applicant’s PFSA(s) are located in areas recognized as Colonia as of October 1, 1989. Colonias are identified using the GIS layer (Colonia Layer) in the RUS mapping tool located at www.usda.gov/reconnect.
- Projects where 75 percent of the applicant’s PFSA(s) is located in persistent poverty counties, defined as any county with 20 percent or more of its population living in poverty over the past 30 years, as measured by the 1990 and 2000 decennial censuses, and the 2007-2011 American Community Survey 5-6 year average, or any territory or possession of the United States.
- Projects where 75 percent of the area of an applicant’s PFSA(s) consists of Socially Vulnerable Communities, as defined in section A.3.iv. of the FOA.
Colonias, persistent poverty counties, Socially Vulnerable Communities, and most Tribal Lands are identified on the GIS layers included in the ReConnect Program Service Area Map.
50% Loan / 50% Grant
Up to $150,000,000 is available for loan-grant combinations. The maximum amount that can be requested in an application is $25,000,000 for the loan and $25,000,000 for the grant. Loan and grant amounts must be equal. The minimum amount that can be requested in an application is $100,000.
The interest rate for the 50% loan component will be set at the Treasury rate for the remaining amortization period at the time of each advance of funds. Loans shall bear interest equal to the cost of borrowing to the Department of Treasury for obligations of comparable maturity. Principal and interest payments will be deferred for three years. The amortization period will be based on the composite economic life of the assets funded plus three years. Applicants may propose substituting cash for the loan component at the time of application and funds must be deposited into the applicant’s operating accounts at the closing of the award.
If an applicant receives a 50% loan / 50% grant award, all cash provided in lieu of loan funds must be expended first, followed by loan funds, and then by grants funds, except for approved application expenses. Grant funds must be requested as part of the first advance request for reimbursement of eligible pre-application expenses.
For this FOA, the advance of funds for a 50/50 loan grant combination will be as follows: a) funds substituted for the loan component will be advanced first, b) loan funds will be advanced second and c) grant funds will be advanced third.
100% Loan
Up to $150,000,000 is available for loans. The maximum amount that can be requested in an application is $50,000,000. The minimum amount that can be requested in an application is $100,000.
The interest rate for a 100% loan will be set at a fixed 2%. Principal and interest payments will be deferred for three years. The amortization period will be based on the composite economic life of the assets funded plus three years.
Projects where 90 percent of households lack sufficient access to broadband
Up to $200,000,000 is available for grants. The maximum amount of grants funds that can be requested in an application is $25,000,000. USDA reserves the right to offer funding to eligible Round 3 applicants once all awards from the current round have been made. The minimum amount that can be requested in an application is $100,000.
Applications submitted under this funding category must demonstrate that 90 percent of the households in each PFSA do not have sufficient access to broadband as defined in the FOA. For applications submitted under this funding category, no matching funds will be required.
