18678 Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules

DEPARTMENT OF AGRICULTURE

Rural Utilities Service

7 CFR Part 1703

RIN 0572–AB31

Distance Learning and Telemedicine

Loan and Grant Program

AGENCY: Rural Utilities Service, USDA.

ACTION: Proposed rule.

SUMMARY: The Rural Utilities Service

(RUS) is proposing to amend its

regulation concerning the Distance

Learning and Telemedicine Grant

Program. This proposed rule will

promulgate regulations for a new loan

program that will provide both loans

and grants for distance learning and

telemedicine projects benefiting rural

areas. The regulation is necessary to

implement a new loan program

mandated by the Federal Agriculture

Improvement and Reform Act of 1996.

The regulation will establish, among

other things, RUS’ policy, the method of

selecting projects to receive loans and

grants and allocating the available

funds, and the requirements for

submitting an application for financial

assistance.

DATES: Written comments must be

received by RUS or carry a postmark or

equivalent not later than May 16, 1997.

ADDRESSES: Submit written comments

to Robert Peters, Assistant

Administrator, Telecommunications

Program, Rural Utilities Service, 1400

Independence Ave., SW, STOP 1590,

Room 4056, South Building,

Washington, DC 20250–1590. RUS

requests a signed original and three

copies of all comments (7 CFR part

1700). All comments received will be

made available for public inspection at

Room 4034, South Building, U.S.

Department of Agriculture, Washington,

DC, between 8:00 a.m. and 4:00 p.m. (7

CFR part 1.27(b)).

FOR FURTHER INFORMATION CONTACT:

Barbara L. Eddy, Deputy Assistant

Administrator, Telecommunications

Program, Rural Utilities Service, STOP

1590, Room 4056, South Building, U.S.

Department of Agriculture, Washington,

DC 20250–1590. Telephone number

(202) 720–9554.

SUPPLEMENTARY INFORMATION:

Classification

This proposed rule has been

determined to be significant and was

reviewed by the Office of Management

and Budget (OMB) under Executive

Order 12866.

Civil Justice Reform

This proposed rule has been reviewed

under Executive Order 12988, Civil

Justice Reform. RUS has determined

that this proposed rule meets the

applicable standards provided in Sec. 3.

of the Executive Order.

Regulatory Flexibility Act Certification

In accordance with the requirements

of the Regulatory Flexibility Act (5

U.S.C. 601 et seq.), the following

analysis of regulatory options that

would minimize any significant impact

on small businesses is provided. Title

VII, section 704, of the Federal

Agriculture Improvement and Reform

Act of 1996 (FAIR Act) (Public Law

104–127) amended Chapter 1 of subtitle

D of title XXIII of the Food, Agriculture,

Conservation, and Trade Act of 1990 by

authorizing the Secretary of Agriculture

to make loans for distance learning and

telemedicine services in rural areas.

This proposed rule would amend 7 CFR

part 1703 to set forth the rules for this

new loan program to be administered by

the RUS. The objectives of the proposed

rule are to encourage and improve

telemedicine and distance learning

services in rural areas through the use

of telecommunications, computer

networks, and related advanced

technologies by students, teachers,

medical professionals, and rural

residents.

The new RUS Distance Learning and

Telemedicine loan program would assist

in providing modern

telecommunication interconnectivity to

educational and medical facilities in

rural America. Through 4 years of

Distance Learning and Telemedicine

grant program activity, approximately

704 rural schools, serving hundreds of

thousands of rural students, will gain

access to improved educational

resources through the information

superhighway by sharing limited

teaching resources and gaining access to

libraries, training centers, vocational

schools, and other institutions located

in metropolitan centers. For

telemedicine, approximately 500 rural

medical facilities will gain access to

improved medical care through linkage

with other rural hospitals and major

urban medical centers for clinical

interactive video consultation, distance

training of rural health care providers,

management and transport of patient

information, and access to medical

expertise or library resources.

This proposed regulation would set

forth the rules for the new loan program

which would provide supplementary

funding for distance learning and

telemedicine services in rural areas. The

proposed regulation would optimize the

use of a limited source of grant and loan

funding by setting forth certain criteria

which enables the Agency to distribute

the amount of funding available among

the greatest number of applicants in an

economical, efficient, and orderly

manner. The regulatory alternative

would be to not publish a regulation;

however, the desired regulatory

purposes, to improve the access of

people residing in rural areas to

improved educational, learning,

training, and health care services and to

achieve the maximum use of funds

available, would not be achieved.

Entities eligible for assistance under

this proposed rule would be those

entities that provide, or would provide,

educational or health care services or

the facilities needed to provide these

services through the use of advanced

telecommunications in rural areas.

There is no good estimate, at this time,

of the number of entities that would be

affected by the proposed rule since the

regulatory requirements would apply to

only those entities which choose to

apply for the financial assistance.

However, RUS is estimating between

250 and 300 applications would be

submitted annually under this program

and of those applicants, between 30 and

50 grants and 100 and 120 loans or

combination thereof would be awarded.

RUS’ existing Distance Learning and

Telemedicine Grant Program, since its

inception in 1993, has received nearly

900 applications for grant funding.

The various reporting and compliance

requirements contained in this proposed

rule for applicants are necessary to

determine such factors as: eligibility;

funding purposes; compliance with

other Federal regulations; project costs

and alternative funding sources; project

feasibility; and need for educational

and/or telemedicine services. Those

reporting requirements imposed on

recipients of financial assistance are

necessary to ensure proper use of

financing for approved purposes. Some

of the required reporting documents

include information generally

maintained by certain types of entities

(i.e., patients or students served,

financial statements, contracts, audits,

etc.). The information collected is in a

format designed to minimize the

paperwork burden on small businesses

and other small entities. The

information collected is the minimum

needed by the Agency to approve

financial assistance and monitor the

grantee or borrower performance.

The impact on small entities would be

limited to the reporting and compliance

regulations which were designed to

minimize the burden in order to
Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules 18679

encourage applicants. Even the

compliance regulations are designed to

only assure the Agency that the

financial assistance was utilized for Act

purposes and also are regulations for

already imposed Government-wide

financial assistance of any kind.

Information Collection and

Recordkeeping Requirements

In accordance with the Paperwork

Reduction Act of 1995 (44 U.S.C.

Chapter 35, as amended) RUS is

requesting comments on the information

collection incorporated in this proposed

rule.

Comments on this information

collection must be received by June 16,

1997.

Comments are invited on: (a) Whether

the proposed 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 the burden of the

proposed collection of information; (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 respondents, including through the

use of automated collection techniques

or other forms of information

technology.

For further information contact

Jonathan Claffey, Acting Deputy

Director, Advanced

Telecommunications Services Staff,

Rural Utilities Service. Telephone: (202)

720–0530. Fax: (202) 720–2734.

Title: Distance Learning and

Telemedicine Loan and Grant Program.

OMB Number: 0572–0096.

Type of Request: Revision of a

previously approved information

collection.

Abstract: The RUS currently

implements a program that provides

grants to rural community facilities,

such as schools, hospitals, and medical

centers, to encourage, improve, and

make affordable the use of advanced

telecommunications and computer

networks to provide educational and

medical benefits to people living in

rural areas and to improve rural access

to reliable facsimile, document and data

transmission, multi-frequency tone

signaling services, 911 emergency

service with automatic number

identification, interactive audio and

visual transmissions, voice mail services

designed to record, store, and retrieve

voice messages, and other advanced

telecommunications services. RUS

currently awards grants and is

proposing to also award loan funds to

projects that will improve the quality of

life of people residing in rural areas by

improving their access to improved

educational, training, and medical

services; and, their access to

opportunities that rely on these

advanced communication and

information technologies to provide

such services. For grants, RUS funds up

to 70 percent of any project selected,

and requires at least a 30 percent

matching contribution from the grant

applicant. For applicants who

voluntarily request loans, RUS proposes

to fund up to 90 percent of any project

selected, and requires at least a 10

percent matching contribution from the

loan applicant.

In order for the public to receive the

benefits of the new loan program, they

need to submit an application and the

supporting information for RUS to

determine if they meet the eligibility

requirements. The Distance Learning

and Telemedicine Loan and Grant

Program regulations (7 CFR 1703,

subpart D), establish the method of

selecting projects to receive grants and

loans, the method of allocating the

available funds, the method of

determining the beneficiaries of the

program, and the requirements for the

application to be submitted to RUS, the

method of notifying potential applicants

of maximum and minimum amounts of

grant and loan funds that will be

considered for a single application.

Estimate of Burden: Public reporting

burden for this collection of information

is estimated to average 2 hours per

response.

Respondents: Business or other for

profit and non-profit institutions.

Estimated Number of Respondents:

300.

Estimated Number of Responses per

Respondent: 29.

Estimated Total Annual Burden on

Respondents: 18,248.

Copies of this information collection

can be obtained from Dawn Wolfgang,

Program Support and Regulatory

Analysis, Rural Utilities Service.

Telephone: (202) 720–0812.

Send comments regarding this

information collection requirement, to

the Office of Information and Regulatory

Affairs, Office of Management and

Budget, ATTN: Desk Officer, USDA,

Room 10102, New Executive Office

Building, Washington, DC 20503, and to

F. Lamont Heppe, Jr., Director, Program

Support and Regulatory Analysis, Rural

Utilities Service, 1400 Independence

Ave., SW., STOP 1522, Room 4034,

South Building, Washington, DC 20250–

1522.

Comments are best assured of having

full effect if OMB receives them within

30 days of publication in the Federal

Register. All comments will become a

matter of public record.

National Environmental Policy Act

Certification

RUS has determined that this

proposed rule will not significantly

affect the quality of the human

environment as defined by the National

Environmental Policy Act of 1969 (42

U.S.C. 4321 et seq.). Therefore, this

action does not require an

environmental impact statement or

assessment.

Program Affected

The program described by this

proposed rule is listed in the Catalog of

Federal Domestic Assistance programs

under number 10.855, Distance

Learning and Telemedicine Loan and

Grant Program. This catalog is available

on a subscription basis from the

Superintendent of Documents, the

United States Government Printing

Office, Washington, DC 20402.

Intergovernmental Review

This program is subject to the

provisions of Executive Order 12372

that requires intergovernmental

consultation with State and local

officials.

Unfunded Mandate

This rule contains no Federal

mandates (under the regulatory

provisions of Title II of the Unfunded

Mandate Reform Act) for State, local,

and tribal governments or the private

sector. Thus today’s rule is not subject

to the requirements of sections 202 and

205 of the Unfunded Mandate Reform

Act.

Background

Title 7, CFR part 1703, subpart D, was

originally published in the Federal

Register February 26, 1993, (58 FR

11507), and became effective March 29,

1993. The Agriculture Improvement and

Reform Act of 1996 (FAIR Act) modified

the Distance Learning and Telemedicine

(DLT) grant program by creating a loan

component. The regulation was

modified and published as a final rule

in the Federal Register on June 27,

1996, (61 FR 33622), to incorporate the

changes to the grant program mandated

by the FAIR Act, excluding those

provisions for administering a loan

program since funds appropriated in

fiscal year 1996 could only be used for

grants. This proposed rule, while based

in part on the existing rule, will (1)

establish criteria for loan and grant

eligibility, (2) simplify the

determination for the comparative

rurality calculation, and (3) place
18680 Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules

greater emphasis on the need for

distance learning or telemedicine

services in the scoring criteria.

Criteria for Loan and Grant Eligibility

The Administrator determines the

portion of the financial assistance

provided to a recipient that consists of

grants and the portion that consists of

cost of money loans so as to result in the

maximum feasible repayment to the

government of the financial assistance,

based on the recipient’s ability to repay

and the full utilization of the funds

available.

RUS proposes to use the National

School Lunch Program (NSLP) to assist

in determining the mix of grants, loans,

and loan-grant combinations for

applicants requesting financial

assistance. The extent of participation

by residents of an area in the NSLP is

a widely accepted measure of the

relative well-being of the area. RUS

believes that using NSLP ratings in the

allocation of grant and loan funds

furthers the FAIR Act’s purpose of

providing modern DLT services in the

most needy parts of rural America. A

high rate of eligibility for school lunch

assistance indicates a low relative

income in the area and less ability to

repay loans. Grants will be made

available to only those otherwise

eligible applicants determined by the

Administrator, after review of the

financial information furnished by the

applicant, to have the least ability to

repay the full amount of the assistance.

RUS is proposing to use a subjective

method to score, up to 45 points,

documentation submitted to support

‘‘the need for services and benefits

derived from services’’ [see

1703.117(b)(1)]. RUS believes that the

need for services and the benefits

derived from the services should be a

critical factor in determining which

application will be successful in

obtaining financial assistance. RUS

could not determine an objective

method to use in scoring this particular

criterion due to the nature of some of

the benefits to be derived that are

priceless, such as lives saved, students

attending higher education institutions,

etc. RUS would like to receive

suggestions from commentors on any

objective method that could be used or

indications from commentors that the

subjective method is acceptable.

The 1995 statistics for the NSLP

indicate that the percentages to be used

to establish eligibility for loans and

grants will result in financial assistance

in the form of loans for approximately

75 percent of qualifying applications.

However, before an applicant may be

awarded a loan, the applicant must be

able to show that the loan will be repaid

within the repayment period and at the

interest rate under which financial

assistance is offered. In addition, this

proposed rule allows for third party

guarantees as evidence of an applicant’s

ability to repay a loan. RUS believes that

the use of third party secured loan

guarantees will provide adequate loan

security and will increase the number of

successful applications for the loan

program.

Rurality Calculation

The rurality calculation used in the

existing regulation was based on a scale

which looked at the characteristics of an

entire county instead of the sites in

which financial assistance being

requested was to be used. This

methodology placed certain areas with

‘‘rural’’ characteristics, yet located in

semi-urban counties, at a disadvantage.

The proposed methodology will address

this situation by being more ‘‘site’’

specific when determining rural needs

and characteristics. For purposes of this

determination, an area shall be

considered rural if it is included within

the boundaries of any incorporated or

unincorporated city, village, or borough

having a population not in excess of

10,000 inhabitants.

Need for Services

More emphasis has been placed on

the need for services and benefits

derived from those services in the

scoring criteria in this proposed rule

versus the existing rule. In seeking

support for this criterion, applicants

may submit documentation explaining

(1) the economic, education or health

care challenges facing the community,

(2) proposed plans to address those

challenges, and (3) how financial

assistance will help and how the project

could not be accomplished without RUS

funding. This scoring criterion seeks to

measure the true ‘‘outcomes’’ of a

proposed project and its derived

benefits and therefore RUS believes it

merits increased scoring value. The

points available for this scoring criterion

have been increased to represent 26

percent of the total possible points

available for any project.

List of Subjects in 7 CFR Part 1703

Community development, Grant

programs—education, Grant programs—

health care, Grant programs—housing

and community development, Loan

programs—education, Loan programs—

health care, Loan programs—housing

and community development, Reporting

and recordkeeping requirements, Rural

areas.

For the reasons set forth in the

preamble, chapter XVII of title 7 of the

Code of Federal Regulations is proposed

to be amended as follows:

PART 1703—RURAL DEVELOPMENT

1. The authority citation for part 1703

continues to read as follows:

Authority: 7 U.S.C. 901 et seq. and 950aaa

et seq., Pub. L. 103–354, 108 Stat 3178 (7

U.S.C. 6941 et seq.).

2. Subpart D of part 1703 is revised to

read as follows:

Subpart D—Distance Learning and

Telemedicine Loan and Grant Program

Sec.

1703.100 Purpose.

1703.101 Policy.

1703.102 Definitions.

1703.103 Applicant eligibility and

allocation of funds.

1703.104 Allowable grant and loan funding

percentage.

1703.105 Grant and loan purposes.

1703.106 In-kind matching provisions.

1703.107 Ineligible loan and grant

purposes.

1703.108 Maximum and minimum sizes of

a grant and a loan.

1703.109 The funding application.

1703.110 Conflict of interest.

1708.111 [Reserved]

1703.112 Determination of types of funding.

1703.113 Application filing dates, location,

processing, and public notification.

1703.114–1703.116 [Reserved]

1703.117 Criteria for scoring applications.

1703.118 Other application selection

provisions.

1703.119 Appeal provisions.

1703.120—1703.121 [Reserved]

1703.122 Further processing of selected

applications.

1703.123—1703.125 [Reserved]

1703.126 Disbursement of loan and grant

funds.

1703.127 Reporting and oversight

requirements.

1703.128 Audit requirements.

1703.129 Repayment of loans.

1703.130—1703.134 [Reserved]

1703.135 Grant and loan administration.

1703.136 Changes in project objectives or

scope.

1703.137 Grant and loan termination

provisions.

1703.138—1703.139 [Reserved]

1703.140 Expedited telecommunications

loans.

Appendix A to Subpart D of Part 1703—

Environmental Questionnaire

Subpart D—Distance Learning and

Telemedicine Loan and Grant Program

§ 1703.100 Purpose.

The purpose of this subpart is to

encourage and improve telemedicine

services and distance learning services

in rural areas through the use of

telecommunications, computer

networks, and related advanced
Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules 18681

technologies by students, teachers,

medical professionals, and rural

residents.

§ 1703.101 Policy.

(a) RUS recognizes that the

transmission of information is vital to

the economic development, education,

and health of rural Americans. To

further this objective, RUS will award

loans and grants under this subpart to

distance learning and telemedicine

projects that will improve the access of

people residing in rural areas to

improved educational, learning,

training, and health care services.

Unless a distinction is made in the

various sections of this subpart, all

aspects of this subpart will apply to all

funding requests.

(b) In providing assistance under this

subpart, RUS will give priority to rural

areas that it believes have the greatest

need of distance learning and

telemedicine services. RUS believes that

generally the need is greatest in

economically challenged areas and

those requiring high costs to serve. This

program is consistent with provisions of

the 1996 Telecommunications Act

(Public Law 104–104, 110 Stat. 56) that

designates telecommunications service

discounts for schools, libraries, and

rural health care providers providing

benefits to rural end-users. RUS will

take into consideration the community’s

involvement in the project and the

applicant’s ability to leverage grant

funds based on its access to capital.

(c) RUS believes that the residents of

rural areas and their local institutions

which serve them can best determine

what are the most appropriate

communications or information systems

for use in their respective communities.

Therefore, in administering this subpart,

RUS will not favor or mandate the use

of one particular technology over

another.

(d) All rural institutions are

encouraged to cooperate with each other

and with applicants and end users in

promoting the program being

implemented under this subpart.

(e) RUS staff will make diligent efforts

to inform potential applicants in rural

areas of the program being implemented

under this subpart.

(f) Financial assistance under this

subpart will consist of grants or cost of

money loans, or both. The

Administrator shall determine the

portion of the financial assistance

provided to a recipient that consists of

grants and the portion that consists of

cost of money loans so as to result in the

maximum feasible repayment to the

Federal Government of the financial

assistance, based on the ability of the

recipient to repay and with the full

utilization of funds made available to

carry out this subpart.

(g) The Administrator may provide a

cost of money loan to entities using

telemedicine and distance learning

services, and, to entities providing or

proposing to provide telemedicine

service or distance learning service to

other persons at rates calculated to

ensure that the benefit of the financial

assistance is passed through to the other

persons.

(h) The Administrator may provide a

cost of money loan under this subpart

to a borrower of a telecommunications

or electric loan under the Rural

Electrification Act of 1936. A borrower

receiving a cost of money loan under

this subpart shall:

(1) Make the funds provided

available, under any terms it so chooses

as long as the terms are no more

stringent than the terms under which it

received the funding, to entities that

qualify as distance learning and/or

telemedicine projects satisfying the

requirements of this subpart.

(2) Use the funds provided to acquire,

install, improve, or extend a system

referred to in this subpart.

§ 1703.102 Definitions.

Act means the Rural Electrification

Act of 1936, as amended (7 U.S.C. 901

et seq.).

Administrator means the

Administrator of the Rural Utilities

Service or his or her designee.

Applicant means an eligible

organization which applies for funding

under this subpart.

Champion community means any

community or area so designated under

the proper procedures.

Completed application means an

application that includes all those items

specified in § 1703.109 in form and

substance satisfactory to the

Administrator.

Comprehensive rural

telecommunications plan means the

plan submitted by an applicant in

accordance with § 1703.109(a).

Computer networks means computer

hardware and software, terminals, signal

conversion equipment including both

modulators and demodulators, or

related devices, used to communicate

with other computers to process and

exchange data through a

telecommunication network in which

signals are generated, modified, or

prepared for transmission, or received,

via telecommunications terminal

equipment and telecommunications

transmission facilities.

Consortium means a combination or

group of eligible entities formed to

undertake the purposes for which the

distance learning and telemedicine

funding is provided. Each consortium

shall be composed of a minimum of two

eligible entities that meet the

requirements of § 1703.103.

Construct means to acquire, construct,

extend, improve, or install a facility or

system.

Cost of money loan. The term cost of

money loan means a loan made under

Title XXIII bearing interest at a rate

equal to the then current cost of money

to the Federal Government, at the time

the feasibility study is completed, for

loans of similar maturity not to exceed

10 years.

Data terminal equipment means

equipment that converts user

information into data signals for

transmission, or reconverts the received

data signals into user information, and

is normally found on the terminal of a

circuit and on the premises of the end

user.

Distance learning means a

telecommunications link to an end user

through the use of eligible equipment to:

(1) Provide educational programs,

instruction, or information originating

in one area, whether rural or not, to

students and/or teachers who are

located in rural areas; or

(2) Connect teachers and/or students,

located in one rural area with teachers

and/or students that are located in a

different rural area.

DLT borrower means an entity that

has outstanding loans under the

provisions of Title XXIII.

Economic useful life as applied to

facilities financed under Title XXIII

means the number of years resulting

from dividing 100 percent by the

depreciation rate (expressed as a

percent) based on Internal Revenue

Service depreciation rules or recognized

telecommunications industry

guidelines.

Eligible equipment means computer

hardware and software, audio and

visual equipment, computer network

components, telecommunications

terminal equipment,

telecommunications transmission

facilities, data terminal equipment,

inside wiring, interactive video

equipment, or other facilities that would

further telemedicine services or distance

learning services. Land, buildings, or

building construction are not

considered eligible equipment (see

§ 1703.107(a)(10)).

Eligible organization means an

incorporated entity that meets the

requirements of § 1703.103.

Empowerment Zone and Enterprise

Community (EZ/EC) means any

community whose designation as such
18682 Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules

pursuant to 26 U.S.C. 1391 et seq. is in

effect at the time RUS agrees to provide

financial assistance.

End user means either or both of the

following:

(1) Rural elementary or secondary

schools or other educational

institutions, such as institutions of

higher education, vocational and adult

training and education centers, libraries,

and teacher training centers, and

students, teachers and instructors using

such rural educational facilities, that

participate in a rural distance learning

telecommunications program through a

project funded under this subpart;

(2) Rural hospitals, primary care

centers or facilities, such as medical

centers and clinics, and physicians and

staff using such rural medical facilities,

that participate in a rural telemedicine

program through a project funded under

this subpart.

End user site means a facility that is

part of a network or telecommunications

system that is utilized by end users.

Financial assistance shall consist of

grants, cost of money loans, or both,

made under Title XXIII.

Grant documents means the letter of

agreement, including any amendments

and supplements thereto, between RUS

and the grant recipient.

Grantee means a recipient of a grant

from RUS to carry out the purposes of

Title XXIII.

Hub means control center of a

network or telecommunications system.

Instructional programming means

educational material, including

computer software, which would be

used for educational purposes in

connection with eligible equipment but

does not include salaries, benefits, and

overhead of medical or educational

personnel.

Interactive video equipment means

equipment used to produce and prepare

for transmission audio and visual

signals from at least two distant

locations such that individuals at such

locations can orally and visually

communicate with each other. Such

equipment includes monitors, other

display devices, cameras or other

recording devices, audio pickup

devices, and other related equipment.

Letter of agreement means a legal

document executed by RUS and the

grantee that contains specific terms,

conditions, requirements, and

understandings applicable to a

particular grant.

Loan documents mean the loan

agreement, note, and security

agreement, including any amendments

and supplements thereto, between RUS

and the DLT or Telecommunications/

Electric borrower.

Local exchange carrier means a

commercial, cooperative or mutual-type

association, or public body that is

engaged in the provision of telephone

exchange service or exchange access.

Matching funds means the applicant’s

funding contribution for allowable

purposes.

National School Lunch Program

(NSLP) means the federally assisted

meal program established under the

National School Lunch Act of 1946 (42

U.S.C. 1751).

Project means an undertaking to

provide or improve distance learning or

telemedicine by using financial

assistance from RUS under this subpart.

Project service area means the area in

which at least 90 percent of the persons

to be served by the project are likely to

reside.

Rural community facilities means

facilities such as schools, libraries,

learning centers, training facilities,

hospitals, medical centers, or similar

facilities, primarily used by residents of

rural areas, that will use a

telecommunications, computer network,

or related advanced technology system

to provide educational and/or health

care benefits primarily to residents of

rural areas.

RUS means the Rural Utilities

Service, an agency of the United States

Department of Agriculture formerly

known as REA. See 7 CFR 1700.1.

Scope of work means a detailed plan

of work that has been approved by the

Administrator to be performed by the

applicant using funding provided under

this subpart.

Secretary means the Secretary of

Agriculture.

Technical assistance means:

(1) Assistance in learning to operate

equipment or systems; and

(2) Studies, analyses, designs, reports,

manuals, guides, literature, or other

forms of creating, acquiring, and/or

disseminating information.

Telecommunications carrier means

any provider of telecommunications

services.

Telecommunications/Electric

borrower means an entity that has

outstanding electric or telephone RUS

and/or Rural Telephone Bank loans or

loan guarantees under the provisions of

the Act.

Telecommunications terminal

equipment means the assembly of

telecommunications equipment at the

end of a circuit or path of a signal,

including but not limited to over the air

broadcast, satellite, and microwave,

normally located on the premises of the

end user, that interfaces with

telecommunications transmission

facilities, and that is used to modify,

convert, encode, or otherwise prepare

signals to be transmitted via such

telecommunications facilities, or that is

used to modify, reconvert, or carry

signals received from such facilities, the

purpose of which is to accomplish the

goal for which the circuit or signal was

established.

Telecommunications transmission

facilities means facilities that transmit,

receive, or carry data between the

telecommunications terminal

equipment at each end of the

telecommunications circuit or path.

Such facilities include microwave

antennae, relay stations and towers,

other telecommunications antennae,

fiber-optic cables and repeaters, coaxial

cables, communication satellite ground

station complexes, copper cable

electronic equipment associated with

telecommunications transmissions, and

similar items.

Telemedicine means a

telecommunications link to an end user

through the use of eligible equipment

which electronically links medical

professionals at separate sites in order to

exchange health care information in

audio, video, graphic, or other format

for the purpose of providing improved

health care services primarily to

residents of rural areas.

Title XXIII means subtitle D, chapter

1, of the Rural Economic Development

Act of 1990 (7 U.S.C. 950aaa through

950aaa–4).

§ 1703.103 Applicant eligibility and

allocation of funds.

(a) To be eligible to receive funding

under this subpart, the applicant must

be organized in one of the following

corporate structures:

(1) An incorporated organization,

partnership, Indian tribe and tribal

organization as defined in 25 U.S.C.

450b (b) and (c), or other legal entity,

including a municipal corporation or a

private corporation organized on a forprofit or not-for-profit basis, which

operates, or will operate, a school,

college, university, learning center,

training facility, or other educational

institution, including a regional

educational laboratory, library, hospital,

medical center, medical clinic or any

rural community facility. A state

government, other than a state

government entity that operates a rural

community facility, is not considered an

eligible applicant; or

(2) A consortium, as defined in

§ 1703.102. A consortium which

includes a state government entity is

only eligible if the state government

entity operates a rural community

facility; or
Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules 18683

(3) An incorporated organization,

partnership, Indian tribe and tribal

organization as defined in 25 U.S.C.

450b (b) and (c), or other legal entity

which is providing or proposes to

provide telemedicine service or distance

learning service to other legal entities or

consortia at rates calculated to ensure

that the economic value and other

benefits of the distance learning or

telemedicine grant is passed through to

such other legal entities or consortia.

(b) At least one of the entities in a

partnership or consortium must be

eligible individually, and the

partnership or consortium must provide

written evidence of its legal capacity to

contract with RUS. If a partnership or

consortium lacks the capacity to

contract, each individual entity must

contract with RUS on its own behalf.

(c) A borrower of an electric or

telecommunications loan under the

Rural Electrification Act of 1936 is

eligible for a cost of money loan only.

(d) All applicants for financial

assistance, with the exception of

applicants requesting a loan and having

the minimum required score, will be

ranked by the type of application

(health care or educational) and total

points scored. Grant funds available for

medical and educational applicants will

be allocated based on the total number

of medical and educational applications

scoring in the top 50 percent of all

applications received. Applications will

be ranked only in one category based on

the predominant use of the project.

§ 1703.104 Allowable grant and loan

funding percentage.

(a) Financial assistance, except as

noted in paragraph (b) of this section,

may be used by eligible organizations

for distance learning and telemedicine

projects to finance up to 70 percent of

the cost of allowable purposes outlined

in § 1703.105 provided that no financial

assistance may exceed the maximum

grant or loan amount for the year in

which the grant or loan is made.

(b) Cost of Money Loans requested by

an applicant may be used by eligible

organizations for distance learning and

telemedicine projects to finance up to

90 percent of the cost of allowable loan

purposes outlined in § 1703.105,

provided that no loan may exceed the

maximum loan amount for the year in

which the loan is made. Financial

assistance applications that do not

request a loan and qualify for a loan or

combination loan and grant will be

funded up to 70 percent of the cost of

allowable purposes.

§ 1703.105 Grant and loan purposes.

(a) Grants and loans shall be limited

to costs associated with the initial

capital assets associated with the

project. Grant and loan funds as set out

in the last sentence of this section shall

not exceed twenty percent (20 percent)

of the requested financial assistance.

The following are allowable grant and

loan purposes:

(a) Acquiring, by lease or purchase,

eligible equipment as defined in

§ 1703.102;

(b) Acquiring instructional

programming; and

(c) Providing technical assistance and

instruction for using eligible equipment,

including any related software;

developing instructional programming;

providing engineering or environmental

studies relating to the establishment or

expansion of the phase of the project

that is being financed with the financial

assistance.

§ 1703.106 In-kind matching provisions.

(a) In-kind matching, the applicant’s

minimum funding contribution

(specified in § 1703.104) for allowable

purposes, is generally required in the

form of cash. However, in-kind

contributions for the purposes listed in

§ 1703.105 may be substituted for cash.

(b) In-kind items listed in § 1703.105

must be non-depreciated or new assets

with established monetary value.

Manufacturers or service providers

discounts are not considered in-kind

matching.

(c) Funding may be provided for end

user sites. Funding may also be

provided for hubs located in rural or

non-rural areas, if they are necessary to

provide distance learning and/or

telemedicine services to rural residents

at end user sites.

§ 1703.107 Ineligible loan and grant

purposes.

(a) Without limitation, funding under

this subpart will not be provided:

(1) To cover the costs of installing or

constructing telecommunications

transmission facilities, except as

provided in paragraph (c) of this

section;

(2) To pay for medical equipment

except medical equipment primarily

used for encoding and decoding data,

such as images, for transmission over a

telecommunications or computer

network;

(3) To pay salaries, wages, or

employee benefits to medical or

educational personnel;

(4) To pay for the salaries or

administrative expenses of the applicant

or the project;

(5) To purchase equipment that will

be owned by the local exchange carrier

or another telecommunications service

provider;

(6) To duplicate facilities providing

distance learning or telemedicine

services in place or to reimburse the

applicant or others for costs incurred

prior to RUS’ receipt of the completed

application;

(7) To pay costs of preparing the

application package for funding under

this program;

(8) For projects whose sole objective

is to provide links between teachers and

students or medical professionals who

are located at the same facility;

(9) For site development and the

destruction or alteration of buildings;

(10) For the purchase of land,

buildings, or building construction;

(11) For projects located in areas

covered by the Coastal Barrier Resources

Act (16 U.S.C. 3501 et seq.);

(12) For any purpose that the

Administrator has not specifically

approved; or

(13) Except for leases provided in

§ 1703.105, to pay the cost of recurring

or operating expenses for the project.

(b) Except as otherwise provided in

§ 1703.140, funds shall not be used to

finance a project in part when success

of the project is dependent upon the

receipt of additional funding under this

subpart D or is dependent upon the

receipt of other funding that is not

assured.

(c) Loans can be used to cover the

costs of telecommunications

transmission facilities if no

telecommunications carrier will install

such facilities under the Act or through

other financing procedures within a

reasonable time period and at a cost to

the applicant that does not jeopardize

the feasibility of the project, as

determined by the Administrator.

§ 1703.108 Maximum and minimum sizes

of a grant and a loan.

Applications for grants and loans to

be considered under this subpart will be

subject to limitations on the proposed

amount of funding. The Administrator

may establish the maximum amount of

financial assistance to be made available

to an individual recipient for each fiscal

year under this subpart, by publishing

notice of the maximum amount in the

Federal Register not more than 45 days

after funds are made available for the

fiscal year to carry out this subpart. The

minimum size of a grant and/or loan is

$50,000.

§ 1703.109 The funding application.

The following items comprise the

required material that must be

submitted to RUS in support of the

funding request:
18684 Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules

(a) Proposed scope of work of the

project. The proposed scope of work of

the project which includes, at a

minimum:

(1) The specific activities to be

performed under the project;

(2) Who will carry out the activities;

(3) The time-frames for accomplishing

the project objectives and activities; and

(4) A budget for capital expenditures

reflecting the line item costs for both the

grant and/or loan funds and other

sources of funds for the project.

(b) Executive summary for the project.

The applicant must provide RUS a

general project overview, verification of

compliance with the general

requirements of this subpart, and

documentation of eligibility. The

executive summary shall contain the

following 9 categories:

(1) A description of why the project

is needed.

(2) An explanation of how the

applicant will address the need cited in

paragraph (b)(1) of this section, why the

applicant requires financial assistance

and types of educational and/or medical

services to be offered by the project, and

the benefits to the rural residents.

(3) A description of the applicant,

documenting eligibility with § 1703.103.

(4) An explanation of the total cost of

the project including a breakdown of the

RUS funding required and the source of

funding for the remainder of the project.

(5) A statement that the project is

either a distance learning or

telemedicine facility as defined in

§ 1703.102. If the project provides both

distance learning and telemedicine

services, the applicant must identify the

predominant use of the system.

(6) A general overview of the

telecommunications system to be

developed, including the types of

equipment, technologies, and facilities

used.

(7) A description of the participating

hubs and end user sites and the number

of rural residents which will be served

by the proposed project at each end user

site.

(8) The applicant must certify that

facilities using financial assistance do

not duplicate adequate established

telemedicine services or distance

learning services. RUS will make the

final determination whether or not

financial assistance requested by an

applicant will duplicate such adequate

established services.

(9) A listing of the location of each

end user site [city, town, village,

borough or rural area plus the state]

discussing how the appropriate National

School Lunch Program eligibility

percentage was determined in

accordance with § 1703.112. These

percentages may be obtained from the

State or local organization that

administers the program and must be

certified by that organization as being

correct.

(c) Financial Information. The

applicant must provide financial

information to support the need for the

funding requested for the project. It

must show its financial capacity to carry

out the proposed work, and show

project feasibility. For educational

institutions participating in a project

application (including all members of a

consortium), the financial data must

reflect revenue and expense reports and

balance sheet reports, reflecting net

worth, for the most recent annual

reporting period preceding the date of

the application. For medical institutions

participating in a project application

(including all members of a

consortium), the financial data must

include income statement and balance

sheet reports, reflecting net worth, for

the most recent completed fiscal year

preceding the date of the application.

When the applicant is a partnership,

company, corporation or other entity,

current balance sheets, reflecting net

worth, are needed from each of the

entities that has at least a 20 percent

interest in such partnership, company,

corporation or other entity. When the

applicant is a consortium, a current

balance sheet, reflecting net worth, is

needed from each member of the

consortium and from each of the entities

that has at least a 20 percent interest in

such member of the consortium.

(1) Applicants must include sufficient

pro-forma financial data which

adequately reflects the financial

capability of project participants and the

project as a whole to continue a

sustainable project for a minimum of 10

years after completion of the project.

This documentation should include

sources of sufficient income or revenues

to pay operating expenses including

telecommunications access and/or toll

charges, system maintenance, salaries,

training, and any other general

operating expenses, and provide for

replacement of depreciable items.

(2) For applicants requesting a loan

and applicants who qualify for a loan or

a combination loan/grant in accordance

with § 1703.112, the documentation

must demonstrate the ability to repay

the loan. RUS will consider a secured

loan guarantee by a third party as

evidence of the ability of the applicant

to repay a loan.

(3) For each hub and end user site, the

applicant must identify and provide

reasonable evidence of each source of

revenue. If the projection relies on cost

sharing arrangements among hub and

end user sites, the applicant must

provide evidence of agreements made

among project participants.

(4) For applicants eligible under

§ 1703.103(a)(3), an explanation of the

economic analysis justifying the rate

structure to ensure that the benefit,

including cost saving, of the financial

assistance is passed through to the other

persons receiving telemedicine or

distance learning services.

(5) For RUS telecommunications and

electric borrowers applying for a cost of

money loan, the only financial

information required in support of that

application is the respective most recent

Annual Report to RUS (i.e. RUS Form

479, Form 7, or Form 12).

(d) A statement of experience. The

applicant must provide a written

narrative (not exceeding three single

spaced pages) describing its

demonstrated capability and experience,

if any, in operating an educational or

health care endeavor and any project

similar to the proposed project.

Experience in a similar project is

desirable but not required.

(e) Funding commitment from other

sources. The applicant must provide

evidence, in form and substance

satisfactory to the Administrator, that all

funds in addition to funds provided

under this subpart are committed and

will be used for the proposed project.

(f) Telecommunications System Plan.

A Telecommunications System Plan,

consisting of the following, is required.

The items in paragraphs (f)(4) and (5) of

this section are needed only when the

applicant is requesting loan funds for

telecommunications transmission

facilities:

(1) The capabilities of the

telecommunications terminal

equipment, including a description of

the specific equipment which will be

used to deliver the proposed service.

The applicant must document

discussions with various technical

sources which could include

consultants, engineers, product vendors,

or internal technical experts, provide

detailed cost estimates for operating and

maintaining the end user equipment

and provide evidence that alternative

equipment and technologies were

evaluated.

(2) A listing of the proposed

purchases or leases of

telecommunications terminal

equipment, telecommunications

transmission facilities, data terminal

equipment, interactive video

equipment, computer hardware and

software systems, and components that

process data for transmission via

telecommunications, computer network

components, communication satellite
Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules 18685

ground station equipment, or any other

elements of the telecommunications

system designed to further the purposes

of this subpart, that the applicant

intends to build or fund using RUS

financial assistance.

(3) A description of the consultations

with the appropriate

telecommunications carriers (including

other interexchange carriers, cable

television operators, enhanced service

providers, providers of satellite services

and telecommunications equipment

manufacturers and distributors) and the

anticipated role of such providers in the

proposed telecommunications system.

(4) Results of discussion with local

exchange carriers serving the project

area addressing concerns in

§ 1703.107(c).

(5) The capabilities of the

telecommunications transmission

facilities, including bandwidth,

networking topology, switching,

multiplexing, standards and protocols

for intra-networking and open systems

architecture (the ability to effectively

communicate with other networks). In

addition, the applicant must explain the

manner in which the transmission

facilities will deliver the proposed

services. For example, for medical

diagnostics, the applicant might

indicate whether or not a guest or other

diagnosticians can join the network

from locations off the network. For

educational services, indicate whether

or not all hub and end-user sites are able

to simultaneously hear in real-time and

see each other or the instructional

material in real-time. The applicant

must include detailed cost estimates for

operating and maintaining the network,

and include evidence that alternative

delivery methods and systems were

evaluated.

(g) Proposed evaluation methodology.

The applicant must provide a proposed

method of evaluating the success of the

project in meeting the objectives of the

program as set forth in § 1703.100 and

§ 1703.101 and the proposed scope of

work.

(h) Compliance with other Federal

statues and regulations. The applicant is

required to submit evidence that it is in

compliance with other Federal statues

and regulations, as detailed in § 1703.33

as follows:

(1) Equal opportunity and

nondiscrimination requirements;

(2) Architectural barriers;

(3) Flood hazard area precautions;

(4) Uniform Relocation Assistance

and Real Property Acquisition for

Federal and Federally Assisted

Programs;

(5) Drug-free workplace;

(6) ‘‘Certification Regarding

Debarment, Suspension and Other

Responsibility Matters—Primary

Covered Transaction’’ (See 7 CFR

3017.510);

(7) Intergovernmental review of

Federal programs if clearing house(s)

exists for the state(s) in which project is

located; and

(8) Restrictions on lobbying. For an

application for funding in excess of

$100,000, a certification statement,

‘‘Certification Regarding Lobbying’’ is

required. If the applicant is engaged in

lobbying activities , the applicant must

submit a completed disclosure form,

‘‘Disclosure of Lobbying Activities’’ (see

7 CFR part 3018).

(i)(1) Environmental impact and

historic preservation. The applicant

must provide details of the project’s

impact on the environment and historic

preservation. Grants and loans made

under this part are subject to 7 CFR part

1794 which contains the policies and

procedures of RUS for implementing a

variety of Federal statues, regulations

and executive orders generally

pertaining to protection of the quality of

the human environment that are listed

in 7 CFR 1794.1. The application shall

contain a separate section entitled

‘‘Environmental Impact of the Project.’’

(2) Environmental information. An

‘‘Environmental Questionnaire,’’

appendix A to this subpart, may be used

by applicants to assist in complying

with the requirements of this section.

Copies of the Environmental

Questionnaire are available from RUS.

(j) A completed Standard Form 424,

‘‘Application for Federal Assistance,’’

along with a board of directors

resolution authorizing the funding

request.

(k) Evidence of the applicant’s legal

existence and authority to enter into a

grant and/or loan agreement with RUS

and perform activities proposed under

the grant or loan application.

(l) Evidence that the applicant is not

delinquent on any obligation owed to

the Federal government (7 CFR parts

3015 and 3016).

(m) Evidence that the applicant has

consulted with the USDA State Director,

Rural Development, concerning the

availability of other sources of funding

available at the state or local level.

(n) Evidence from the USDA State

Director, Rural Development, that the

application conforms with the State

strategic plan as prepared under section

381D of the Consolidated Farm and

Rural Development Act 7 U.S.C. 1921 et

seq.). The applicant should indicate if

such a plan does not exist.

(o) A depreciation schedule covering

all assets of the project. Those assets for

which financial assistance is being

requested should be clearly indicated.

(p) Supplemental information. The

applicant should provide any additional

information it considers relevant to the

project and likely to be helpful in

determining the extent to which the

proposed project would further the

purposes of this subpart.

(q) Additional information requested

by RUS. The applicant must provide

any additional information the

Administrator may consider relevant to

the application and necessary to

adequately evaluate the application and

make funding decisions. The

Administrator may also request

modifications or changes, including

changes in the amount of funds

requested, in any proposal described in

an application submitted under this

subpart.

§ 1703.110 Conflict of interest.

At any time prior to the disbursement

of a grant or loan awarded under this

subpart, the Administrator may

disqualify an otherwise eligible project

whenever, in the judgment of the

Administrator, the project would create

a conflict of interest or the appearance

of a conflict of interest. The

Administrator will notify the applicant

in writing of his/her intention to

disqualify the project under this section

and set forth the basis for his/her

determination that a conflict of interest

or appearance exists. Thereafter, the

applicant will have 30 days from the

date of such notice to file a written

response with the Administrator. If the

Administrator receives the applicant’s

response within the 30-day period, the

Administrator will consider the

information contained therein before

making a final determination whether to

disqualify the project. The

Administrator will promptly notify the

applicant of the final determination

whether a conflict of interest or

appearance of a conflict exists. If the

determination is affirmative, the notice

will also advise the applicant whether

the project is disqualified or

conditionally disqualified. If the project

is conditionally disqualified, the notice

will state under what circumstances the

project may continue to be eligible for

assistance under this subpart. The

Administrator’s decision under this

section will be final.

§ 1703.111 [Reserved]

§ 1703.112 Determination of types of

funding.

(a) To maximize the use of available

funding and to obtain the maximum

repayment to the Federal Government,

RUS will determine if an applicant will
18686 Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules

be awarded a grant, loan or a

combination of both loans and grants

based upon the following:

(1) The percentage of students eligible

to participate in the National School

Lunch Program in the areas where the

end user sites comprising the project are

located; and

(2) The applicant’s ability to pay for

the project.

(b) The methodology contained in this

section will be used to evaluate the

relative financial need of the applicant,

community, and project. All applicants

are required to provide the applicable

percentage of students eligible to

participate in the National School

Lunch Program for each end user site

which must be certified as being correct

by the appropriate State or local

organization administering the program.

The type of financial assistance will be

determined as follows:

(1) If the end user site(s) for the

project have, or are located in school

districts which have, from 0–32 percent

student eligibility in the National

School Lunch Program, the project

qualifies for a loan.

(2) If the end user site(s) for the

project have, or are located in school

districts which have, from 33–60

percent student eligibility in the

National School Lunch Program, the

project qualifies for a loan and may be

eligible for some grant funds.

(3) If the end user site(s) for the

project have, or are located in school

districts which have, from 61–100

percent student eligibility in the

National School Lunch Program, the

project qualifies for a grant. The

applicant may indicate its desire to be

considered for a loan or a combination

loan and grant if denied a grant

provided the financial data required in

§ 1703.109(c) indicates the ability to

repay a loan. Grant applicants should

indicate if they desire to be considered

for a loan.

(c) The following guidelines will be

used to determine the applicable

National School Lunch Program

eligibility percent for a particular end

user site:

(1) Public schools or non profit

private schools of high school grade or

under will use the actual eligibility

percentage for that particular school.

(2) Schools and institutions of higher

learning ineligible to participate in the

National School Lunch Program and

non-school end user sites (medical

facilities, libraries, etc.) will use the

eligibility percentage of all students in

the school district where the end user

will be located.

(d) If all the end user sites in a

proposed network or system fall within

the same percentile category, the project

will be eligible for the type of financial

assistance set forth in paragraph (b) of

this section.

(e) If end user sites fall within

different percentile categories the

eligibility percentages associated with

each end user site will be averaged to

determine the percentile category and

type of financial assistance the

applicant is eligible for. For purposes of

averaging, if a hub is also utilized as an

end user site, the hub will be considered

as an end user site.

(f) For those applicants which qualify

for a combination loan/grant, the

Administrator will determine the

amount of grant funding the applicant

will receive, if any, based upon analysis

of the financial condition of the

applicant as reflected by the information

submitted under § 1703.109(c). The

minimum amount of grant funding will

be $5,000.

(g) RUS will submit a letter to those

applicants being offered financial

assistance in the form of a loan, or a

combination of a loan and grant,

outlining terms and conditions of such

assistance. The applicant will have 15

days from the date of the letter to accept

the terms and conditions in the letter. If

the applicant fails to respond within

this time the Administrator may

withdraw the offer of financial

assistance and the applicant will have

no right to appeal the withdrawal.

§ 1703.113 Application filing dates,

location, processing, and public

notification.

(a) Applications for funding under

this subpart shall be submitted to the

Administrator, Rural Utilities Service,

U.S. Department of Agriculture, 1400

Independence Avenue, SW., STOP

1590, Washington, DC 20250–1590.

Applications should be marked

‘‘Attention: Assistant Administrator,

Telecommunications Program’’.

(b) Applications for loans can be

submitted at any time. RUS will review

each application for completeness in

accordance with § 1703.109, and notify

the applicant, within 15 working days of

the receipt of the application, of the

results of this review, citing any

information which is incomplete. To be

considered for loan funds during the

fiscal year (FY) that the application is

submitted, the applicant must submit

any information needed to complete the

application by June 30. If this review

concludes that a loan is feasible and the

application receives the required

minimum number of points as

determined using the scoring criteria in

§ 1703.117, the Administrator will

immediately process the application.

The minimum number of points

required for a loan application to be

immediately processed will be

published in the Federal Register each

fiscal year.

(c) Applications requesting grant

funds must be submitted to RUS to

arrive not later than May 31, 1997, if the

applications are to be considered during

FY 1997. Beyond FY 1997, all

applications requesting grant funds

must be submitted to RUS to arrive not

later than April 30 if the applications

are to be considered during the fiscal

year the application is submitted. It is

suggested that applications be submitted

prior to the above deadline to ensure

they can be reviewed and considered

complete by the deadline. RUS will

review each application for

completeness in accordance with

§ 1703.109, and notify the applicant,

within 15 working days of the receipt of

the application, of the results of this

review, citing any information which is

incomplete. To be considered for grant

funds, the applicant must submit the

information to complete the application

by May 31 in FY 97 and April 30

beyond FY 97. If the applicant fails to

submit such information by the

appropriate deadline, the application

will be considered during the next fiscal

year.

(d) The Administrator will publish, at

the end of each fiscal year, a notice in

the Federal Register of all completed

applications receiving funding under

this subpart. The Administrator will

also make those applications available

for public inspection at the U.S.

Department of Agriculture, 1400 and

Independence Avenue, SW.,

Washington, DC. For purposes of this

paragraph, applications include any

information not protected by the Privacy

Act of 1974, 5 U.S.C. 552a, and any

other information that has not been

designated as proprietary information

by the applicant.

(e) All applicants must submit an

original and two copies of a completed

application. A grant applicant must also

submit a copy of the application to the

State government point of contact, if one

has been designated for the state, at the

same time it submits an application to

RUS. All applications must include the

information described in § 1703.109.

§§ 1703.114–1703.116 [Reserved]

§ 1703.117 Criteria for scoring

applications.

(a) Criteria. The criteria in this section

will be used by the Administrator to

score applications that have been

determined to be in compliance with

the requirements of this subpart.
Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules 18687

Applicants shall address the following

criteria:

(1) The need for services and benefits

derived from services;

(2) The comparative rurality of the

proposed project service area;

(3) The ability to leverage resources;

(4) Innovativeness of design;

(5) Connectivity with outside

networks;

(6) The cost effectiveness of the

design;

(7) Project participation in EZ/EC

(Empowerment Zone and Enterprise

Communities); and

(8) Project participation in Champion

communities.

(b) Scoring criteria—(1) The need for

services and benefits derived from

services. (i) This criterion will be used

by the Administrator to score

applications based on the

documentation submitted in the support

of the funding application that reflects

the need for services and benefits

derived from the services proposed by

the project. Up to 45 points can be

assigned to this criterion.

(ii) The Administrator will consider

the extent of the applicant’s

documentation explaining the

economic, education or health care

challenges facing the community; the

applicants proposed plan to address

these challenges; how the financial

assistance can help; and why the

applicant cannot complete the project

without a loan or grant. The

Administrator will also consider any

support by recognized experts in the

related educational or health care field,

any documentation substantiating the

educational and/or health care

underserved nature of the applicant’s

proposed service area, and any

justification for specific educational

and/or medical services which are

needed and will provide direct benefits

to rural residents. Some examples of

benefits to be provided by the project

include, but are not limited to:

(A) Improved education opportunities

for a specified number of students;

(B) Travel time and money saved by

telemedicine diagnosis;

(C) Number of doctors retained in

rural areas;

(D) Number of additional students

electing to attend higher education

institutions;

(E) Lives saved due to prompt medical

diagnosis and treatment;

(F) New education courses offered,

including college level courses;

(G) Expanded use of educational

facilities such as night training;

(H) Number of patients receiving

telemedicine diagnosis;

(I) Provision of training, information

resources, library assets, adult

education, lifetime learning, community

use of technology, jobs, connection to

region, nation, and world.

(iii) That rural residents, and other

beneficiaries, desire the educational

and/or medical services to be provided

by the project (a strong indication of

need is the willingness of local end

users or institutions to pay, to the extent

possible, for proposed services).

(iv) The project’s development and

support based on input from the local

residents and institutions.

(v) The extent to which the

application is consistent with the State

strategic plan prepared by the Rural

Development State Director of the

United States Department of

Agriculture.

(2) The comparative rurality of the

proposed project service area. (i) The

methodology contained in this section is

used to evaluate the relative rurality (i.e.

population) of service areas for various

projects. Under this system, the end

user sites and hubs (as defined in

§ 1703.102) contained within the

proposed project service area are

identified. Then, those locations are

given a score according to the

population of the area where the end

user sites are located. Up to 35 points

can be assigned to this criterion.

(ii) The following definitions are used

in the evaluation of rurality:

(A) Exceptionally 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 5,000 inhabitants.

(B) Rural Area means any area of the

United States included within the

boundaries of any incorporated or

unincorporated city, village, or borough

having a population over 5,000 and not

in excess of 10,000 inhabitants.

(C) Urban Area means any area of the

United States included within the

boundaries of any incorporated or

unincorporated city, village, or borough

having a population in excess of 10,000

inhabitants.

(iii) The applicant will receive points

as follows:

(A) There are a total of 35 possible

points for this criterion. The maximum

number of points each end user site can

receive is determined by dividing the

total possible points for this criterion,

35, by the total number of end user sites.

If a hub is utilized as an end user site,

the hub will be considered as an end

user site.

(B) If the end user site is located in

an Exceptionally Rural Area, it will

receive the maximum number of points

each end user site. If the end user site

is located in a Mid-Rural Area, it will

receive 50 percent of the maximum

number of points each end user site. If

the end user site is located in an Urban

Area, it will receive 0 percent of the

maximum number of points each end

user of the applicant can receive.

(C) The total points for each end user

site will be added to reach a final point

total for the project.

(D) An application must receive a

minimum of 18 points under this

criterion to be eligible for any financial

assistance.

(3) The ability to leverage resources.

(i) This section is used to evaluate the

ability of the applicant to contribute

financially to the project and to secure

other non-Federal sources of funding.

Documentation submitted in the

support of the funding application

should reflect any additional financial

support for the project from non-Federal

sources above the applicant’s required

percent matching of the RUS financial

assistance as set forth in § 1703.104. The

applicant must include evidence from

authorized representatives of the

sources that the funds are available and

will be used for the proposed project—

up to 35 points.

(ii) The applicant will receive points

as follows:

(A) Matching for allowable financial

assistance purposes greater than 30

percent, but less than or equal to 50

percent of the RUS financial

assistance—10 points.

(B) Matching for allowable financial

assistance purposes greater than 50

percent, but less than or equal to 100

percent of the RUS financial

assistance—20 points.

(C) Matching for allowable financial

assistance purposes greater than 100

percent, but less than or equal to 150

percent of the RUS financial

assistance—25 points.

(D) Matching for allowable financial

assistance purposes greater than 150

percent, but less than or equal to 200

percent of the RUS financial assistance

—30 points.

(E) Matching for allowable financial

assistance purposes greater than 200

percent of the RUS financial

assistance—35 points.

(4) Innovativeness of project. This

criterion will be used by the

Administrator to score applications

based on the documentation submitted

in the support of the funding

application that reflects the innovative

nature of the project. The applicant

should explain the extent to which, if

any, the project is an innovative

approach to either delivering or using

telecommunications to address the

needs of the community, and how the

project differs in approach from the
18688 Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules

typical educational or health care

application of technology. Up to 20

points can be assigned to this criterion.

(5) Connectivity with outside

networks. (i) This criterion will be used

by the Administrator to score

applications based on the

documentation submitted in support of

the funding application that reflects the

extent to which the proposed project

can be connected to other educational

and/or health care networks. Up to 20

points can be assigned to this criterion.

(ii) Consideration will be given to the

extent that the proposed project will

interconnect with other existing

networks at the regional, statewide,

national or international levels. RUS

believes that to the extent possible,

educational and health care networks

should be designed to connect to the

widest practicable number of other

networks that expand the capabilities of

the proposed project, thereby affording

rural residents opportunities that may

not be available at the local level. The

ability to connect to the internet alone

can not be used as the sole basis to

fulfill this criteria.

(iii) Consideration will also be given

to the extent that facilities constructed

with federal financial assistance,

particularly financial assistance under

this chapter provided to entities other

than the applicant, will be utilized to

extend or enhance the benefits of the

proposed project.

(6) Cost effective design. (i) This

criterion will be used by the

Administrator to score applications

based on the documentation submitted

in the support of the funding

application that reflects the cost

efficiency of the project design. Up to 15

points can be assigned to this criterion.

(ii) Consideration will be given to the

extent that the proposed technology or

technologies for delivering the proposed

educational and/or health care services

for the project service area are the most

cost effective for the project proposed.

The application must contain

information necessary for the

Administrator to use accepted analytical

and financial methodologies to

determine whether the applicant is

proposing the most cost-effective

option. The Administrator will consider

the applicant’s documentation

comparing various systems and

technologies, whether the applicant’s

system is the most cost-effective system,

and whether buying or leasing specific

equipment is more cost effective. Points

will be deducted from the scores of the

applications that fail to utilize existing

telecommunications facilities that could

provide the transmission path for the

needed services.

(7) Project participation in EZ/ECs.

This criterion will be used by the

Administrator to score applications

based on the documentation submitted

in support of the funding application

that reflects the designation of

Empowerment Zones and Enterprise

Communities (EZ/EC) included as

beneficiaries of the proposed project.

Ten (10) points will be assigned if at

least one end user site is located in an

EZ/EC.

(8) Project participation in Champion

communities. This criterion will be used

by the Administrator to score

applications based on the

documentation submitted in support of

the funding application that reflects the

designation of Champion communities

included as beneficiaries of the

proposed project. Five (5) points will be

assigned if at least one end user site is

located in a Champion community.

§ 1703.118 Other application selection

provisions.

(a) Selection. Applications will be

selected for funding based on scores,

availability of funds, and the provisions

of this section. The Administrator will

make determinations regarding the

reasonableness of all numbers; dollar

levels; rates; the nature and design of

the project; cost; location; and other

characteristics of the application and

the proposed project to determine the

number of points assigned to a grant

application for all selection criteria.

Joint applications submitted by multiple

applicants as set forth in § 1703.113 will

be rated as a single application.

(b) Regardless of the number of points

an application receives in accordance

with § 1703.117 or the feasibility of the

proposed project, the Administrator

may, based on a review of the

applications in accordance with the

requirements of this subpart:

(1) Limit the number of applications

selected for projects located in any one

state during a fiscal year;

(2) Limit the number of selected

applications for a particular project;

(3) Select an application receiving

fewer points than another higher scoring

application if there are insufficient

funds during a particular funding period

to select the higher scoring application;

provided, however, the Administrator

may ask the applicant of the higher

scoring application if it desires to

reduce the amount of its application to

the amount of funds available if,

notwithstanding the lower grant

amount, the Administrator determines

the project is financially feasible in

accordance with § 1703.109(d)(1) at the

lower amount;

(4) Award a grant to an applicant

whose application carries out the

priorities listed in the scoring criteria in

such a way to make the application

unique; or

(5) Award a grant to an applicant

which would normally qualify for other

financial assistance, if the project

achieves one or more of the following:

(i) Utilizes cutting edge technology to

provide a solution to a unique problem;

(ii) Provides services otherwise not

possible in an extremely isolated

geographic area; or

(iii) Provides inordinate quantifiable

benefit to rural communities relative to

the amount of financial assistance

requested.

(c) The Administrator will not

approve an application if the

Administrator determines that:

(1) The applicant’s proposal does not

indicate financial feasibility or is not

sustainable in accordance with the

requirements of § 1703.109(d)(1);

(2) The applicant’s proposal indicates

technical flaws, which, in the opinion of

the Administrator, would prevent

successful implementation, operation,

or sustainability of the proposed project;

or

(3) Any other aspect of the applicant’s

proposal fails to adequately address any

requirements of this subpart or contains

inadequacies which would, in the

opinion of the Administrator,

undermine the ability of the project to

meet the general purpose of this subpart

or comply with policies of the Distance

Learning and Telemedicine Loan and

Grant Program set forth in § 1703.101.

(d) The Administrator may reduce the

amount of the applicant’s grant award

based on insufficient program funding

for the fiscal year in which the project

is reviewed, and/or offer the applicant

loan funds in addition to the grant

funds, if the Administrator determines

that, notwithstanding a lower grant

award, the project will show financial

feasibility in accordance with

§ 1703.109(d)(1), and continues to meet

all other provisions of this subpart. RUS

will discuss its findings informally with

the applicant and make every effort to

reach a mutually acceptable agreement

with the applicant. Any discussions

with the applicant and agreements made

with regard to a reduced grant amount

will be confirmed in writing, and these

actions shall be deemed to have met the

notification requirements set forth in

paragraph (e) of this section.

(e) The Administrator will provide the

applicant an explanation of any

determinations made with regard to

paragraphs (c)(1) through (c)(3) of this

section prior to making final project

funding selections for the year. The
Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules 18689

applicant will be provided 15 days from

the date of the Administrator’s letter to

respond, provide clarification, or make

any adjustments or corrections to the

project. If, in the opinion of the

Administrator, the applicant fails to

adequately respond to any

determinations or other findings made

by the Administrator, the project will

not be funded, and the applicant will be

notified of this determination. If the

applicant does not agree with this

finding an appeal may be filed in

accordance with § 1703.119.

§ 1703.119 Appeal provisions.

All qualifying applications under this

subpart will be scored based on criteria

in section § 1703.117. A determination

will be made by the Administrator

based on the highest ranking

applications and the amount of funds

available for grants and loans. All

applicants will be notified in writing of

the score each application receives, and

included in this notification will be a

tentative minimum required score to

receive financial assistance. If the score

received by the applicant could result in

the denial of its application, or if its

score, while apparently sufficient to

qualify for financial assistance, may be

surpassed by the score awarded to a

competing application after appeal, the

applicant may appeal its numerical

scoring. Any appeal must be based on

inaccurate scoring of the application by

RUS and no new information or data

that was not included in the original

application will be considered. The

appeal must be made in writing within

10 days after the applicant is notified of

the scoring results. Appeals shall be

submitted to the Administrator, Rural

Utilities Service, U.S. Department of

Agriculture, 1400 Independence Ave.,

SW, STOP 1590, Washington, DC

20250–1590. Thereafter, the

Administrator will review the original

scoring to determine whether to sustain,

reverse or modify the original scoring

determination. Final determinations

will be made after consideration of all

appeals. The Administrator’s

determination will be final. A copy of

the Administrator’s decision will be

furnished promptly to the applicant. An

appeal based solely upon the type of

financial assistance the applicant

qualifies for will not be considered.

§§ 1703.120–1703.121 [Reserved]

§ 1703.122 Further processing of selected

applications.

(a) During the period between the

submission of the application and the

execution of implementing documents,

the applicant must inform the

Administrator if the project is no longer

viable or the applicant no longer desires

financial assistance for the project. If the

applicant so informs the Administrator,

the selection will be rescinded and

written notice to that effect shall be sent

promptly to the applicant.

(b) If an application has been selected

and the nature of the project changes,

the applicant may be required to submit

a new application to the Administrator

for consideration depending on the

degree of change. A new application

will be subject to review in accordance

with this subpart. The selection may not

be transferred to another project.

(c) If state or local governments raise

objections to a proposed project under

the intergovernmental review process

that are not resolved within 3 months of

the Administrator’s selection of the

application, the Administrator may

rescind the selection and written notice

to that effect will be sent promptly to

the applicant.

(d) Recipients of financial assistance

will be required to submit RUS Form

479–A, ‘‘Distance Learning and

Telemedicine Technical

Questionnaire.’’

(e) After an applicant selected for

financial assistance has submitted such

additional information, if any, the

Administrator determines is necessary

for completing the financial assistance

documents, the Administrator will send

the documents to the applicant to

execute and return to RUS.

(1) The financial assistance

documents will include a letter of

agreement for grants; loan documents,

including third party guarantees, for

loans; or any other legal documents the

Administrator deems appropriate,

including suggested forms of

certifications and legal opinions.

(2) The letter of agreement and the

loan documents will contain, among

other things, conditions on the release

or advance of funds and include at a

minimum, a project description,

approved purposes, the maximum

amount of the funding, supplemental

funds, required of the project and

certain agreements or commitments the

applicant may have proposed in its

application. In addition, the loan

documents will contain covenants and

conditions the Administrator deems

necessary or desirable to provide

assurance that the loan will be repaid

and the purposes of the loan will be

accomplished.

(3) The recipient of a loan will be

required to execute a security

instrument in form and substance

satisfactory to the Administrator.

(4) DLT borrowers must, before

receiving any advances of loan funds,

provide security that is adequate, in the

opinion of the Administrator, to assure

repayment, within the time agreed, of

all loans to the borrower under Title

XXIII. This assurance will generally be

provided by a first lien upon all of the

borrower’s assets or such portion thereof

as shall be satisfactory to the

Administrator. The Administrator may

consider the projected revenues from

the facilities subject to the lien.

(5) Security may also be provided by

third-party guarantees, letters of credit,

pledges of revenue or other forms of

security satisfactory to the

Administrator.

(6) The mortgage, deed of trust,

security agreement and other loan

documents required by the

Administrator in connection with loans

under Title XXIII shall contain such

pledges, covenants, and other

provisions as may, in the opinion of the

Administrator, be necessary or desirable

to secure repayment of the loan.

(7) If the facilities financed do not

constitute a complete operating system,

the DLT borrower shall provide

evidence demonstrating, to the

Administrator’s satisfaction, that the

borrower has sufficient contractual or

other arrangements to assure that the

facilities financed will provide adequate

and efficient service.

(f) Until the letter of agreement or

loan documents have been executed and

delivered by RUS and by the applicant,

the Administrator reserves the right to

require any changes in the project or

legal documents covering the project to

protect the integrity of the program and

the interests of the United States

Government.

(g) If the applicant fails to submit,

within 120 calendar days from the date

of the Administrator’s selection of an

application, all of the information that

the Administrator determines to be

necessary to prepare legal documents

and satisfy other requirements of this

subpart, the Administrator may rescind

the selection of the application and

written notice of such rescission will be

sent promptly to the applicant.

§§ 1703.123–1703.125 [Reserved]

§ 1703.126 Disbursement of loan and grant

funds.

(a) For financial assistance of

$100,000 or greater, prior to the

disbursement of funds, the recipient, if

it is not a unit of government, will

provide evidence of fidelity bond

coverage as required by 7 CFR 3015.17.

(b) Financial assistance will be

disbursed to recipients on a

reimbursement basis, or with unpaid

invoices for the eligible purposes set
18690 Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules

forth in this subpart, by the following

process:

(1) An SF 270, ‘‘Request for Advance

or Reimbursement,’’ will be completed

by the recipient and submitted to RUS

not more frequently than once a month;

(2) After receipt of a properly

completed SF 270, RUS will review for

accuracy and if the form is satisfactory

will schedule payment. Payment will

ordinarily be made within 30 days; and

(3) For financial assistance approved

during and subsequent to FY 1997,

funds will be advanced in accordance to

7 CFR 1744.69.

(c) The recipient’s share in the cost of

the project will be disbursed in advance

of financial assistance, or if the recipient

agrees, on a pro rata distribution basis

with financial assistance during the

disbursement period. Recipient will not

be permitted to provide its contribution

at the end of the project.

(d) Concurrent grant and loan funds

will be disbursed on a pro rata

distribution basis.

§ 1703.127 Reporting and oversight

requirements.

(a) A project performance activity

report will be required of all recipients

on an annual basis until the project is

complete and the funds are disbursed by

the applicant.

(b) A final project performance report

will be required. It must provide an

evaluation of the success of the project

in meeting the objectives of the

program. The final report may serve as

the last annual report.

(c) RUS will monitor recipients as the

Administrator determines necessary to

assure that projects are completed in

accordance with the approved scope of

work and that funds are expended for

approved purposes.

(d) Recipients shall diligently monitor

performance to ensure that time

schedules are being met, projected work

by time periods is being accomplished,

and other performance objectives are

being achieved. Recipients are to submit

an original and one copy of all reports

submitted to RUS. The project

performance reports shall include, but

not be limited to, the following:

(1) A comparison of actual

accomplishments to the objectives

established for that period;

(2) A description of any problems,

delays, or adverse conditions which

have occurred, or are anticipated, and

which may affect the attainment of

overall project objectives, prevent the

meeting of time schedules or objectives,

or preclude the attainment of particular

project work elements during

established time periods. This

disclosure shall be accompanied by a

statement of the action taken or planned

to resolve the situation; and

(3) Objectives and timetable

established for the next reporting

period.

§ 1703.128 Audit requirements.

The grant and DLT borrower loan

recipients will provide an audit report

in accordance with 7 CFR part 3015,

subpart I. For grant recipients the audit

requirements only apply to the year(s)

in which grant funds are expended. For

DLT borrowers the audit requirements

apply until the loan is repaid. Audits

must be prepared in accordance with

generally accepted government auditing

standards (GAGAS) using publication,

‘‘Standards for Audit of Governmental

Organization, Programs, Activities and

Functions.’’ RUS Telecommunications/

Electric borrowers receiving cost of

money loans will be subject to the same

audit requirements for these loans as are

provided for in 7 CFR part 1773.

1703.129 Repayment of loans.

The term of cost of money loans will

be based on the life of the facilities to

be financed, not to exceed 10 years. If

the recipient requests, a one year

deferment of principal will be included.

In special hardship cases, which the

recipient must justify, the Administrator

may approve a two year deferment of

principal. Interest on the loan will be

due and payable during the principal

deferral period. RUS will establish

uniform debt service payments based on

the total amortization period.

§§ 1703.130–1703.134 [Reserved]

§ 1703.135 Grant and loan administration.

(a) The Administrator will review

recipients as necessary to determine

whether funds were expended for

approved purposes. The recipient is

responsible for ensuring that the project

complies with all applicable

regulations, and that the financial

assistance is expended only for

approved purposes. The recipient is

responsible for ensuring that

disbursements and expenditures of

funds are properly supported by

invoices, contracts, bills of sale,

canceled checks, or other appropriate

forms of evidence, and that such

supporting material is provided to the

Administrator, upon request, and is

otherwise made available, at the

recipient’s premises, for review by the

RUS representatives, the recipient’s

certified public accountant, the office of

Inspector General, U. S. Department of

Agriculture, the General Accounting

Office and any other officials

conducting an audit of the recipient’s

financial statements or records, and

program performance for the funding

awarded under this subpart. The

recipient will be required to permit RUS

to inspect and copy any records and

documents that pertain to the project.

(b) Grants provided under this

program will be administered under,

and are subject to 7 CFR parts 3015

through 3018, as appropriate. 7 CFR

parts 3015 and 3016 subject grantees to

a number of requirements which cover,

among other things, financial reporting,

accounting records, budget controls,

record retention and audits, bonding

and insurance, cash depositories for

grant funds, grant related income, use

and disposition of real property and/or

equipment purchased with grant funds,

procurement standards, allowable costs

for grant related activities, and grant

close-out procedures.

§ 1703.136 Changes in project objectives

or scope.

The recipient will obtain prior

approval for any material change to the

scope or objectives of the approved

project, including changes to the scope

of work or budget. Failure to obtain

prior approval of changes can result in

suspension or termination of funds.

§ 1703.137 Grant and loan termination

provisions.

(a) Termination for cause. The

Administrator may terminate any

financial assistance in whole, or in part,

at any time before the date of

completion of funding disbursement,

whenever it is determined that the

recipient has failed to comply with the

conditions of the financial assistance.

The Administrator will promptly notify

the recipient in writing of the

determination and the reasons for the

termination, together with the effective

date.

(b) Termination for convenience. The

Administrator or the recipient may

terminate financial assistance in whole,

or in part, when both parties agree that

the continuation of the project would

not produce beneficial results

commensurate with further expenditure

of funds. The two parties will agree

upon termination conditions, including

the effective date, and in the case of

partial terminations, the portion to be

terminated. The recipient will not incur

new obligations for the terminated

portion after the effective date, and will

cancel as many outstanding obligations

as possible. The Administrator will

allow full credit to the applicant for the

Federal share of the noncancelable

obligations, properly incurred by the

recipient prior to termination.
Federal Register / Vol. 62, No. 73 / Wednesday, April 16, 1997 / Proposed Rules 18691

§§ 1703.138–1703.139 [Reserved]

§ 1703.140 Expedited telecommunications

loans.

General. The Administrator will

expedite consideration and

determination of an application for a

loan or a request for advance of funds

submitted by an RUS

telecommunications borrower that

supports the project seeking financial

assistance under this subpart. See 7 CFR

part 1737 for loans and 7 CFR part 1744

for advances under this section.

Appendix A to Subpart D of Part 1703—

Environmental Questionnaire

Note: It is extremely important to respond

to all questions completely to ensure

expeditious processing of the Distance

Learning and Telemedicine application. The

information herein is required by Federal

law.

Important: Any activity related to the

project that may adversely affect the

environment or limit the choice of reasonable

development alternatives shall not be

undertaken prior to the completion of Rural

Utilities Service’s environmental review

process.

Legal Name of

Applicant llllllllllllllll

Signature

(Type/Sign/Date) llllllllllll

The applicant’s representative certifies, to

the best of his/her knowledge and belief, that

the information contained herein is accurate.

Any false information may result in

disqualification for consideration of the grant

or rescission of the grant.

I. Project Description—Detailing

construction, including, but not limited to,

internal modifications of existing structures,

and/or installation of telecommunications

transmission facilities (defined in 7 CFR

1703.102), including satellite uplinks or

downlinks, microwave transmission towers,

and cabling.

1. Describe the portion of the project, and

site locations (including legal ownership of

real property), involving internal

modifications, or equipment additions to

buildings or other structures (e.g., relocating

interior walls or adding computer facilities)

for each site.

2. Describe the portion of the project, and

site locations (including legal ownership or

real property), involving construction of

transmission facilities, including cabling,

microwave towers, satellite dishes; or,

disturbance of property of .99 acres or greater

for each project site.

3. Describe the nature of the proposed use

of the facilities, and whether any hazardous

materials, air emissions, wastewater

discharge or solid waste will result.

4. State whether or not any project site(s)

contain or are near properties listed or

eligible for listing in the National Register of

Historic Places, and identify any historic

properties (The applicant must supply

evidence that the State Historic Preservation

Officer (SHPO) has cleared development

regarding any historical properties).

5. Provide information whether or not any

facility(ies) or site(s) are located in a 100-year

floodplain. A National Flood Insurance Map

should be included reflecting the location of

the project site(s).

II. For projects which involve construction

of transmission facilities, including cabling,

microwave towers, satellite dishes, or

physical disturbance of real property of .99

acres or greater, the following information

must be submitted (7 CFR 1703.109(i)(3)).

1. A map (preferably a U.S. Geological

Survey map) of the area for each site affected

by construction (include as an attachment).

2. A description of the amount of property

to be cleared, excavated, fenced or otherwise

disturbed by the project and a description of

the current land use and zoning and any

vegetation for each project site affected by

construction.

3. A description of buildings or other

structures (i.e., transmission facilities),

including dimensions, to be constructed or

modified.

4. A description of the presence of

wetlands or existing agricultural operations

and/or threatened or endangered species or

critical habitats on or near the project site(s)

affected by construction.

5. Describe any actions taken to mitigate

any environmental impacts resulting from

the proposed project (use attachment if

necessary).

Note: The applicant may submit a copy of

any environmental review, study,

assessment, report or other document that

has been prepared in connection with

obtaining permits, approvals or other

financing for the proposed project from State,

local or other Federal bodies. Such material,

to the extent relevant, may be used to meet

the requirements herein.

Dated: April 7, 1997.

Jill Long Thompson,

Under Secretary, Rural Development.

[FR Doc. 97–9422 Filed 4–15–97; 8:45 am]

BILLING CODE 3410–15–P