KRS § 224A.1123 — KY Code / Title XVIII / Chapter 224A / Section 224A.1123
224A.1123 Rural infrastructure improvement fund -- Kentucky Rural Infrastructure Improvement Program
Status: in_force

224A.1123 Rural infrastructure improvement fund -- Kentucky Rural

Infrastructure Improvement Program.

(1) The General Assembly hereby finds and declares that:

(a) A rural infrastructure improvement fund, and a program to administer the

fund, is necessary to further the Commonwealth's goal to expand and

accelerate access to broadband service throughout the entire

Commonwealth; and

(b) Supporting the replacement of utility poles will provide benefits to

Kentucky residents by:

1. Facilitating the construction of broadband networks;

2. Minimizing the potential for disputes between broadband providers

and utility pole owners that could otherwise delay deployment;

3. Improving the resiliency and longevity of broadband infrastructure;

and

4. Addressing needs for broadband investment not yet fully met by

existing programs.

(2) As used in this section:

(a) "Application" means an application made under subsection (4) of this

section for eligible pole replacement costs;

(b) "Eligible pole replacement":

1. Means the removal of an existing utility pole and replacement with a

new utility pole in an unserved area in order to accommodate the

attachment of facilities to be used, in whole or in part, by a retail

provider to provide qualifying broadband service access to

residences or businesses within an unserved area; and

2. Does not include the removal and replacement of a utility pole in

order to accommodate facilities used only for the provision of

wholesale broadband or data transport service, where the owner of

the facilities, or its affiliate, does not use the facilities to provide

qualifying broadband services directly to residences or businesses;

(c) "Eligible pole replacement costs":

1. Means:

a. The actual and reasonable costs paid or incurred to perform an

eligible pole replacement;

b. The amounts of any expenditures to remove and dispose of

the existing utility pole, to purchase and install a replacement

utility pole, or to transfer any existing facilities to the new pole;

and

c. The costs of reimbursing another party for the costs of

performing an eligible pole replacement, when paid or incurred

by the person responsible for the costs; and

2. Does not include:

a. Costs paid or incurred to perform an eligible pole replacement

by a party who is not responsible for those costs, and which

are charged or passed along to the responsible party;

b. Costs for which the party incurring or paying the costs

separately has received or is entitled to receive reimbursement

under the terms of a state or federal grant program for the

deployment of broadband facilities; and

c. The receipt of a state or federal grant where the pole

replacement costs, for which reimbursement is requested,

exceed the pole replacement costs that were reasonably

anticipated at the time of, or on which the amount of, the other

support funding was predicated.

Costs are considered separately reimbursed for purposes of this

paragraph if the amount of an award under another state or federal

broadband program included consideration, by the awarding entity, of the

pole replacement costs by the applicant;

(d) "Fund" means the rural infrastructure improvement fund established by

subsection (3) of this section;

(e) "Pole owner" means any person or entity that owns or controls a utility

pole;

(f) "Program" means the Kentucky Rural Infrastructure Improvement

Program established by subsection (4) of this section;

(g) "Qualifying broadband service" means a retail wireline broadband service

capable of delivering Internet access at speeds of at least one hundred

(100) megabits per second in both the downstream and upstream

directions, and with latency at a level sufficient to permit real-time,

interactive applications; and

(h) "Utility pole" means any pole used, in whole or in part, for any wire

communications or electric distribution, regardless of the owner or

operator of the pole.

(3) (a) There is created within the State Treasury a trust and agency account to

be known as the rural infrastructure improvement fund, consisting of

moneys appropriated by the General Assembly, federal funds, grants, and

gifts.

(b) The fund shall be administered by the Office of Broadband Development

and all money deposited in the fund shall be used:

1. By the office to provide reimbursements to qualified applicants

under the Rural Infrastructure Improvement Program established

under subsection (4) of this section;

2. For the purposes of covering the costs of program administration

and operation; and

3. In a manner consistent with federal law.

(c) Notwithstanding KRS 45.229, any moneys remaining in the fund at the

close of the fiscal year shall not lapse but shall be carried forward into the

succeeding fiscal year to be used for the purposes set forth in this

section.

(d) Interest earned on money deposited to the credit of the fund shall be

retained in the fund and shall not lapse.

(e) Moneys deposited in the fund are hereby appropriated for the purposes in

this section.

(4) (a) There is hereby established the Kentucky Rural Infrastructure

Improvement Program for the purpose of expediting and facilitating the

deployment of broadband service to individuals, businesses, agricultural

operations, and community access points in unserved areas by

reimbursing a portion of eligible pole replacement costs incurred by

eligible applicants.

(b) The office shall administer and provide staff assistance for the program

and shall be responsible for receiving, reviewing, and approving

applications for pole reimbursements.

(c) The office shall award pole reimbursements from moneys in the fund

created by subsection (3) of this section until all moneys in the fund are

exhausted.

(d) No later than September 1, 2022, the office shall:

1. Promulgate administrative regulations under KRS Chapter 13A

necessary for the administration of this section;

2. Publish an application for pole replacement reimbursements that

shall require:

a. Information sufficient to establish the number, cost, and

eligibility of eligible pole replacements that qualify for

reimbursement;

b. Documentation sufficient to establish that the claimed eligible

pole replacements have been completed, including receipts

verifying the amount of eligible pole replacement costs paid by

the applicant;

c. The amount of program reimbursement requested in the

application and any grant funding or accounting information

required to justify the amount of the request;

d. i. A statement that the costs for which reimbursement is

requested have not been reimbursed through any other

state or federal broadband grant program.

ii. If the applicant is a recipient of funding from another

program, the statement shall include an explanation of

how the costs for which reimbursement is requested

exceed the pole replacement costs on which the original

award was predicated or that were reasonably anticipated

at the time of the original award;

e. A notarized statement from an officer or agent of the applicant

that the contents of the application are true and accurate and

that the applicant accepts the requirements of this section and

any promulgated administrative regulations as a condition of

receiving an award of program reimbursement; and

f. Any other information necessary for the office to comply with

any conditions on federal funding used in connection with the

program; and

3. Publish and maintain on its Web site:

a. Statistics on the number of applications received, processed,

and rejected by the office under the pole replacement program;

b. Statistics on the size, number, and status of reimbursements

awarded by the office under the pole replacement program,

including the pole owners and broadband providers receiving

reimbursements; and

c. The amount of money remaining in the fund.

(e) An applicant who incurs or pays the costs of an eligible pole replacement

to accommodate broadband facilities consistent with this section may

apply to the office for reimbursement.

(f) As a condition of receiving reimbursement under this subsection, an

applicant shall:

1. Certify its compliance with the requirements of this section;

2. Agree to comply with any requirements that the office determines to

be necessary conditions on federal funding used in connection with

the program;

3. Agree to refund, with interest at the applicable federal funds rate as

specified by KRS 355.4A-506, to the fund, any reimbursements or

portions of reimbursements received from the fund under this

subsection, if the office finds, upon substantial evidence and after

notice and opportunity to respond, that the recipient materially

violated any of the requirements agreed to under this section;

4. Agree that no funds awarded by the program will be used to meet

any cash match requirement under any other broadband program

administered by the Commonwealth or one (1) of its subdivisions;

5. Agree to submit reports as the office may require regarding

broadband deployment facilitated by the program, which may

include reports demonstrating that an application that has received a

federally funded award is meeting or exceeding buildout

requirements contained in that award; and

6. Agree to not include in any rates or fees charged for its services any

eligible pole replacement costs that were reimbursed by the

program, paid for by a broadband provider, or funded by another

grant source.

(g) 1. If the necessary information is not otherwise reasonably available to

the applicant, the applicant may request a pole owner performing an

eligible pole replacement to provide the number and costs of the

pole replacements, receipts verifying the amount of pole

replacement costs paid by the applicant, and confirmation that the

pole replacement costs were incurred to accommodate the

applicant(cid:25)s attachment and not due to some other reason.

2. In the event the office requires additional information from an

applicant following the submission of an application to confirm the

eligibility of costs in an application that is in the possession of the

pole owner and not otherwise reasonably available to the applicant,

the applicant may also request that the pole owner assist with

providing the information as requested by the office.

3. A pole owner shall coordinate in good faith to provide the

information to the applicant, and may require reimbursement from

the broadband provider of its actual and reasonable administrative

expenses in connection with the coordination, which shall not

exceed five percent (5) of the eligible pole replacement costs.

4. Administrative costs that a broadband provider reimburses to a pole

owner under this subsection are not eligible for reimbursement from

the fund as eligible pole replacement costs.

(h) Within sixty (60) days of receipt of a completed application establishing

the eligibility of costs for reimbursement, and to the extent that moneys

are available in the fund, the office shall award the lesser of:

1. Five thousand dollars ($5,000) for each pole replaced; or

2. Fifty percent (50) of the total amount incurred or paid by the

applicant for eligible pole replacement costs.

(i) Any application pending at the exhaustion of the moneys in the fund shall

be deemed denied but may be refiled if sufficient moneys are later made

available in the fund.

(j) No later than one (1) year after the fund receives moneys for the purpose

of providing pole replacement reimbursements to qualified applicants, the

authority shall, on an annual basis, cause to be conducted an

independent audit of the office's administration of the fund for compliance

with the requirements of this section. This audit may be performed by

either the Auditor of Public Accounts or a certified public accountant in

conjunction with the annual audit of the authority. The authority shall

comply with the provisions of KRS 45.149 before entering into a contract

for audit services with a certified public accountant.

(5) A broadband provider's use of funds reimbursed under this subsection to pay

eligible pole replacement costs shall have no effect on the subsequent

ownership of any replacement pole purchases and installed by a pole owner

using the funds.