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Local Dial-Up Internet Grants

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Rural Utilities Service, USDA.


Notice of funds availability.


The Rural Utilities Service (RUS) announces a new grant program and the availability of grant funds under this program to finance the acquisition, construction and installation of equipment, facilities and systems to provide dial-up Internet access services in rural America. The President of the United States and the United States Congress have made $2 million in grant funds available, through a Pilot Program, to encourage eligible entities to provide Internet service to rural consumers where such service does not currently exist. This program will provide grant funds, on a competitive basis, to entities serving communities up to 20,000 inhabitants to ensure rural consumers enjoy the same quality and range of telecommunications services that are available in urban and suburban communities. Applications for grant funds will be accepted through November 13, 2001.


Applications for grants will be accepted as of the date of this notice through November 13, 2001. All applications must be delivered to RUS or bear postmark no later than November 13, 2001. Comments regarding the information collection requirements under the Paperwork Reduction Act must be received on or before October 15, 2001, to be assured of consideration.


Applications are to be submitted to the Rural Utilities Service, U.S. Department of Agriculture, 1400 Independence Avenue, SW., Stop 1590, Room 40 South Building, Washington, DC 20250-1590. Comments regarding the information collection requirements may be sent to F. Lamont Heppe, Jr., Program Development and Regulatory Analysis, Rural Utilities Service, U.S. Department of Agriculture, 1400 Start Printed Page 42837Independence Ave., SW., Stop 1522, Room 4034 South Building, Washington, DC 20250-1522.

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Roberta D. Purcell, Assistant Administrator, Telecommunications Program, Rural Utilities Service, 1400 Independence Avenue, SW., Stop 1590, Washington, DC 20250-1590, Telephone (202) 720-9554, Facsimile (202) 720-0810.

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Information Collection and Recordkeeping Requirements

In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), RUS invites comments on this information collection for which RUS intends to request approval from the Office of Management and Budget (OMB). These requirements have been approved by emergency clearance under OMB Control Number 0572-0125.

Comments on this notice must be received by October 15, 2001.

Comments are invited on (a) whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) the accuracy of the agency's estimate of burden including the validity of the methodology and assumption used; (c) ways to enhance the quality, utility and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.

Comments may be sent to F. Lamont Heppe, Jr., Director, Program Development and Regulatory Analysis, Rural Utilities Service, U.S. Department of Agriculture, 1400 Independence Ave., SW., Stop 1522, Room 4034 South Building, Washington, DC 20250-1522.

Title: Local Dial-Up Internet Grant Program.

Type of Request: New collection.

Estimate of Burden: Public reporting burden for this collection of information is estimated to average 33.5 hours per response.

Respondents: Public bodies, commercial companies, cooperatives, nonprofits, and limited dividend or mutual associations and must be incorporated or a limited liability company.

Estimated Number of Respondents: 25.

Estimated Number of Responses per Respondent: 20.

Estimated Total Annual Burden on Respondents: 1,005 hours.

Copies of this information collection can be obtained from Michele Brooks, Program Development and Regulatory Analysis, at (202) 690-1078.

All responses to this information collection and recordkeeping notice will be summarized and included in the request for OMB approval. All comments will also become a matter of public record.

General Information

For FY 2001, $2 million in grants will be made available for the construction and installation of facilities and for other costs as RUS deems necessary to provide dial-up Internet services in rural areas. This program is authorized by 7 U.S.C. 950aaa.


Applications will be accepted as discussed previously in the DATES section of this notice. All interested parties are strongly encouraged to contact the Rural Utilities Service official listed in the FOR FURTHER INFORMATION CONTACT section of this notice to discuss its financial needs and eligibility, prior to sending an application to the address listed in the ADDRESSES section of this notice. Applications will be scored and processed on a competitive basis.

Use of Grant Funds

Grant funds may be used to finance the acquisition, construction, and installation of equipment, facilities, and systems to provide dial-up Internet service in rural areas. Grant funds may also be used to fund lease costs for transmission equipment, facilities, and systems for up to two years.

Size of Grants

The maximum amount of a grant award to an applicant under this program is $400,000. The minimum amount to be considered is $10,000.

Definition of Internet

As used in this notice, the term Internet means a world wide collection of interconnected computer networks and users that share a compatible means of interacting with one another for the purpose of exchanging electronic data.

Definition of Dial-Up Internet Services

As used in this notice, the term dial-up Internet services means providing Internet access via local dial tone access with no toll or long distance charges.

Definition of Rural Area

As used in this notice, rural area means any area of the United States not included within the boundaries of any incorporated or unincorporated city, village, or borough having a population in excess of 20,000 inhabitants.

Grant Terms

For FY 2001, $2 million in grants will be made available to eligible applicants. Grants will be awarded to eligible applicants based on their score (starting with the highest scoring application) in comparison to other applications until the $2 million appropriation is utilized in its entirety. The grants will be awarded on a competitive basis, based on the scoring criteria outlined below.

Eligible Applicants

Grants may be made to legally organized entities providing, or proposing to provide, dial-up Internet services in rural areas. Eligible entities may be public bodies, commercial companies including limited liability companies, cooperatives, nonprofits, and limited dividend or mutual associations.

Matching Funding

No match funding is required.

RUS Findings

Project Sustainability. An applicant shall provide RUS with satisfactory evidence to enable the Administrator to determine that the project utilizing grant funds will be sustainable for a minimum of five years. Factors used in making this determination include, but are not limited to:

(1) Evidence of sufficient revenues from the system in excess of operating expenditures (including maintenance and replacement); and

(2) Reasonable assurance of achieving market penetration projections upon which the grant is based.

Grant Application

Application should be prepared in conformance with the provisions of this notice and applicable USDA regulations including 7 CFR parts 3015, 3016, and 3019. Applicants must submit a completed Standard Form 424, “Application for Federal Assistance,” a narrative grant proposal, and all required supporting information and documents. An application must include a project description that contains plant designs, a subscriber forecast, and the basis for that forecast. The narrative must also specifically and clearly address the scoring criteria set out below. Other items include:

(1) Certified financial statements, if available;

(2) 5 years of pro-forma financial information, evidencing the sustainability of the project; Start Printed Page 42838

(3) An environmental report, satisfactory to RUS;

(4) Depreciation rates, based on current industry standards, for the equipment being financed (acceptance of such rates will be subject to RUS approval);

(5) A sketch or map showing existing and proposed service areas;

(6) A description of the current level of service available;

(7) Information on the owners and principal employees' relevant work experience that would ensure the success of the project; and

(8) All other required forms for Federal assistance and compliance with other applicable Federal statutes.

Review of Grant Applications

All applications for grants must be delivered to RUS at the address listed above or postmarked no later than November 13, 2001 to be considered eligible for FY 2001 grant funding. RUS will review each application for conformance with the provisions of this Notice. RUS may contact the applicant for additional information or clarification. Incomplete applications will not be considered. Applications conforming with this Notice will then be evaluated competitively by a panel of RUS employees selected by the Administrator and points awarded as described in the Scoring Criteria section below. The applications will be ranked and grants awarded in rank order until all grant funds are expended.

Scoring Criteria

Grant awards will be made based on the following scoring criteria as determined by RUS:

(1) The need for services and benefits derived from services (up to 40 points). This criterion will be used by RUS to score applications based on the documentation in support of the need for services, benefits derived from the services proposed by the project, and local community involvement in planning, implementing, and financial assistance of the project. RUS will consider the extent of the applicant's documentation explaining the challenges facing the community; the applicant's proposed plan to address these challenges; how the grant can help; and why the applicant cannot complete the project without a grant.

(2) The economic need of the applicant's service area as determined by per capita personal income by County, as determined by the Bureau of Economic Analysis, U.S. Department of Commerce, at​bea/​regional/​reis/​ (up to 40 points). Applicants will be awarded points as outlined below for service provided in each county where the per capita personal income (PCI) is less than 70 percent of the national average per capita personal income (NAPCI):

(i) PCI is 70 percent or greater of NAPCI; 0 points;

(ii) PCI is less than 70 percent and greater than 60 percent of NAPCI; 10 points;

(iii) PCI is less than 60 percent and greater than 50 percent of NAPCI; 20 points;

(iv) PCI is less than 50 percent and greater than 40 percent of NAPCI; 30 points;

(v) PCPI is less than 40 percent of NAPCPI; 40 points;

If an applicant proposes significant service in more than one county, an average score will be calculated based on each counties' individual scores.

(3) Project services USDA designated EZ/ECs (Empowerment Zone and Enterprise Communities) (10 points) or USDA designated Champion Communities (5 points).

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Dated: August 9, 2001.

Blaine D. Stockton,

Acting Administrator, Rural Utilities Service.

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[FR Doc. 01-20560 Filed 8-14-01; 8:45 am]