Arkansas Administrative Code › Agency 003 - DEPARTMENT OF COMMERCE › Division 25 - Arkansas Broadband Office › Rule 003.25.22-002 - Addendum 2 to Arkansas Rural connect-ARPA

Current through Register Vol. 49, No. 6, June, 2024
SECTION 1.
BACKGROUND
The Director of the Arkansas Economic Development Commission
				("Director") issues this Rule to respond to urgent, telecommunication needs in
				this State for communities impacted by the COVID-19 pandemic. On or about
				February 21, 2020, the Director issued the Arkansas Rural Connect Broadband
				Rule (hereafter, the "Broadband Rule") to implement the Arkansas Rural Connect
				Program (hereafter, "Arkansas Rural Connect," or "Arkansas Rural Connect
				Program," or "ARC"). This Broadband Rule was promulgated prior to the issuance
				of State and Federal public health guidelines responding to the COVID-19
				pandemic.
The COVID-19 pandemic has severely impacted the citizens of
				this State. COVID-19 has brought about an urgent and immediate need for
				broadband internet access. Broadband enables workers to telework, patients to
				use telemedicine services, K-12 and college students and unemployed workers in
				need of reskilling to participate in distance education, religious people to
				participate in online worship services, and all citizens to shop online,
				interact with friends through Skype and other video chat tools, and keep up
				with the latest news and public health guidelines.
In response to the pandemic, Arkansas has received federal
				funds under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act),
				and State and Local Fiscal Recovery Funds (SLFRF) under the American Rescue
				Plan Act (ARPA). These funds allowed states to broaden and strengthen their
				broadband infrastructure in unserved or underserved areas. All ARPA funds must
				be obligated by December 31, 2024. The period of performance will run until
				December 31, 2026.
The need still exists for broadband infrastructures that
				directly enable work, education and health monitoring in response to the
				effects of COVID-19. ARPA federal guidance was modified April 1, 2022, adding
				significant requirements. The AEDC Broadband Office is modifying its rule
				through this addendum to harmonize with the changed federal guidance.
				Additionally, the AEDC Broadband Office has submitted an application to the
				U.S. Department of Treasury for up to $158 million in funding for broadband
				projects through the Coronavirus Capital Projects Fund (CPF). The CPF is a
				distinct funding program under ARPA and has requirements that differ from
				SLFRF.
The Arkansas Rural Connect program promotes broadband
				deployment in rural areas of Arkansas that lack meaningful and efficient
				broadband services. The ARC program and its purposes align with allowable uses
				of SLFRF and CPF.
Due to the urgent need for broadband for distance learning,
				telemedicine and the need for telework necessitated by the COVID-19 pandemic,
				there is a need to issue this new ARPA rule to disburse funds immediately and
				to accelerate the continued deployment of broadband network
				infrastructure.
Additionally, on April 18, 2022, the Arkansas Broadband Master
				Plan: Assessment and Recommendations (the "Broadband Master Plan") was
				published by Broadband Development Group pursuant to a study commissioned by
				the AEDC Broadband Office and requested by the Arkansas General Assembly.
				Changes to the rule also incorporate recommendations made by the Broadband
				Master Plan.
SECTION 2.
AUTHORITY
This Rule is authorized to be issued by the Director of the
				Arkansas Economic Development Commission ("AEDC") under Ark. Code Ann. §
									15-4-209(b) (5)
				which provides that AEDC may promulgate rules necessary to implement the
				programs and services offered by AEDC. On or about August 9, 2019, Governor Asa
				Hutchinson authorized a transfer of funding for the implementation and
				administration of the ARC Program to AEDC. Pursuant to Ark. Code Ann. §
									15-4-209(a)(1),
				AEDC is authorized to administer grants to assist with the economic development
				in the State. AEDC is therefore authorized to administer the ARC grant program
				and further authorized to issue administrative rules under Ark. Code Ann.
				§
									15-4-209(b)
				(5).
SECTION 3.
PURPOSE AND QUALIFICATION
			 FOR RECEIVING ARPA FUNDS
This purpose of this addendum is to harmonize with recent
				federal guidance as it relates to dispensing ARPA funds, including funding
				through SLFRF and CPF, for the expansion of broadband network infrastructure
				for the unserved and underserved areas of Arkansas. Unserved and underserved
				areas are locations without access to a reliable wireline connection of
				100Mbps/20Mbps.
All ARPA approved projects funded through SLFRF must be able to
				provide synchronous bandwidths of 100mbps download and 100mbps upload. Where
				impractical, due to geographical, topographical or financial constraints the
				upload speed can be as low as 20mbps but must be scalable to 100mbps in such
				instances. Whenever bandwidths are asynchronous, the internet service provider
				("ISP") must submit a letter detailing why the upload speeds cannot be obtained
				at 100mbps and the Department of Commerce AEDC Broadband Office ("AEDC
				Broadband Office") will determine if the ISP letter is approved for the
				requested bandwidth modification.
All ARPA approved projects funded through CPF must be able to
				provide synchronous bandwidths of 100mbps download and 100mbps upload. Projects
				funded through CPF will not permit temporary, asynchronous speeds allowed under
				SLFRF.
Priority will be given to fiber-optic infrastructures where
				feasible, as such advanced technology better supports scalability to meet
				expected increases in bandwidth demand. Regardless of technology infrastructure
				deployed, the ISP must demonstrate that it will reliably deliver a minimum of
				100/20mbps in the case of SLFRF funded projects, and 100/100mbps in the case of
				CPF funded service throughout the service area. The ARPA program also requires
				the ISP to submit its customer pricing list with its project application. The
				ISP is also required to participate in the FCC's Affordable Connectivity
				Program. As indicated below, affordability of broadband service will be a
				significant factor in determining grant awards. Applications that include at
				least one low-cost option (less than $50 per month), at speeds of at least
				100/20 mbps, without data usage caps or the obligation to purchase bundled
				services, will be awarded extra points in the scoring rubric. Applicants must
				include with their application a narrative demonstrating that their proposed
				pricing is affordable for consumers in the proposed project service
				area.
The AEDC Broadband Office, or its designee, will define project
				areas available for grant awards, funding source (i.e., SLFRF or CPF) and
				deadlines for submitting applications. Each project area will be comprised of
				full and partial census blocks identified as unserved and underserved areas in
				the Broadband Master Plan defined by a set of polygons in a GIS shapefile. It
				is anticipated that multiple applicants will submit applications for each
				project area.
All applicants must have a System for Award Management (SAM)
				number issued by the federal government to participate in the ARC program. ISPs
				must submit with their applications (i) audited financial statements made by an
				independent certified public accountant for the past two years, or, in the
				absence of audited financial statements, such other financial and operational
				documentation reasonably acceptable to the ASBO that demonstrates the financial
				stability of the applicant and its ability to fulfill the obligations under the
				grant agreement, and (ii) the endorsement of the application by each mayor or
				county judge within the proposed project area. It is expected that each mayor
				and county judge may endorse multiple applications. If the ISP is unable to
				secure the endorsement of a mayor or the county judge, then it must submit with
				its application a statement to that effect along with a description of its
				efforts to obtain an endorsement, and the reason, if any, that was given as to
				why an endorsement was not provided by the mayor or county judge.
Each project will be scored using 8 different scoring metrics:
				1.) speed of service (10% of total score), 2.) future-proof (10% of total
				score), 3.) quality of coverage, i.e. reliability and scalability of service
				(15% of total score), 4.) time to deploy (15% of total score), 5.)
				qualifications/experience/financial strength of applicant (10% of total score),
				6.) applicant's contribution toward project costs (10% of score), 7.) cost of
				project (15% of total score), and 8.) affordability of service to the consumer
				(15% of total score). The maximum score for this rubric is 100 points. All
				projects will be scored individually, with the highest scored applications
				receiving ARC grant funding awards. There is no minimum or maximum limit on
				project size or dollar amount requested for ARC grant program applications. But
				overall project cost is a key factor of consideration. Where there is a tie for
				project awards the AEDC Broadband Office, or its' designee, will make an
				administrative decision as to which project it will award. The AEDC Broadband
				Office, or its' designee, will consider the scores for the most important
				factors such as project price, quality of service, deployment timeline and
				affordability of service to the consumer to break ties. Next, if the tie is not
				resolved, the AEDC Broadband Office, or its designee, will consider the Mayor
				and County Judge project preferences and customer service complaints made to
				the AEDC Broadband Office, or its designee. Please keep in mind that verified
				customer complaints, depending on nature or frequency, from prior or present
				ARC projects could result in an application not being awarded an ARC grant no
				matter the project score. This is also true if the AEDC Broadband Office learns
				of verified complaints from customers from an ISPs pre-existing network(s). All
				projects for application submissions will be subject to a challenge process.
				See Section 8.
Qualified project areas subject to ARC grant funding must not
				have a federal commitment, i.e., a grant from the Rural Digital Opportunity
				Fund that will provide a reliable wireline connection of at least 100/20 Mbps.
				Each ISP applicant receiving a grant using ARPA funds will guarantee broadband
				service to the citizens of Arkansas, within its project footprint, for a
				minimum of 10 years from the time of completed infrastructure deployment. Grant
				awardees who fail to reliably deliver service within the project footprint for
				the required 10-year period will be subject to the penalty provisions of
				Arkansas Rural Connect Broadband Grant Program Rule.
SECTION 4.
PROJECT FUNDING
The AEDC Broadband Office will fund up to 75% percent of the
				total cost of the project. The applicant shall fund a minimum of 25% of the
				project costs. Internet service providers shall maintain an irrevocable standby
				letter of credit equal to 100% of the grant award amounts disbursed to the
				internet service provider. The irrevocable standby letter of credit shall
				follow the same standards found in
				47 C.F.R. §
										54.804(c)(2) and will be
				accompanied by an opinion letter from applicant's legal counsel stating that
				the irrevocable standby letter of credit and its proceeds will not be subject
				to a Chapter 11 bankruptcy proceeding. The AEDC Broadband Office may allow the
				letter of credit amount to be reduced to no less than 25% of the grant award as
				the project progresses and defined milestones in the project deployment plan
				are met. The letter of credit must remain in place until the project is
				completed and acceptance testing by the Broadband Office is satisfactorily
				concluded.
In lieu of a letter of credit the internet service provider
				will be required to furnish a performance bond in an amount equal to the grant
				award. The performance bond will be in the form of a surety bond issued by a
				surety company as a guarantee of delivery of goods/services in accordance with
				the specifications and within the time period established in the grant
				agreement. Surety bonds must be issued by a surety company authorized to do
				business in Arkansas and must be signed by a resident local agent licensed by
				the Arkansas State Insurance Commissioner to represent the surety company. The
				resident agent's power-of-attorney must accompany the surety bond. The company
				issuing the surety bond must comply with all stipulations herein and must be
				named in the U.S. Treasury listing of companies holding certificates of
				authority as acceptable sureties on Federal Bonds and as acceptable reinsuring
				companies. Any excess between the face amount of the bond and the underwriting
				limitation of the bonding company shall be protected by reinsurance provided by
				an acceptable reinsuring company.
Please note, the AEDC Broadband Office, or its' designee,
				reserves the right to stop funding should it learn that grantee's vendors or
				subcontractors are not getting paid for work performed on ARC projects. Funding
				will resume when the AEDC Broadband Office, or its' designee, is satisfied the
				matter has been resolved.
SECTION
			 5.
DEADLINES, UNSERVED AND UNDERSERVED AREAS
ARPA funds must be obligated by December 31, 2024, and all
				broadband network deployments completed by December 31, 2026. The AEDC
				Broadband Office will determine the dates by which awarded projects shall be
				completed within these allowed deadlines.
SECTION 6.
MAPS AND RULE
			 OBLIGATIONS
The AEDC Broadband Office, at its discretion, may request from
				the applicants maps and other information necessary to make informed decisions
				as to the proper unserved or underserved locations in Arkansas to expend grant
				funds. Applicants that accept funding under this Rule shall follow all the
				requirements under the State and Local Fiscal Recovery Fund Guidance and the
				Capital Projects Fund Guidance, as applicable, and ARC rules. Every applicant
				is responsible for knowing both the state rules and federal guidelines without
				exception. In the event of any conflict between this rule and the federal rules
				and guidance applicable to broadband deployments funded with ARPA funds, the
				federal rules and guidance will control.
SECTION 7.
EFFECTIVE DATE; COORDINATION
			 WITH ARC GRANT PROGRAM RULE
This Rule is effective ten days after filing with the Secretary
				of State of the final rule that has been reviewed and approved by the Arkansas
				Legislative Council. The Rule is incorporated into and made a part of the
				Arkansas Rural Connect Broadband Grant Program Rule, as amended effective
				February 7, 2022. In the event of any conflict between the terms of this Rule
				and Arkansas Rural Connect Broadband Grant Program Rule, the terms of this Rule
				shall control.
SECTION 8.
ARKANSAS RURAL CONNECT REQUEST FOR PROJECT CHALLENGE INFORMATION
Definitions.
The following definitions were added:
Point Shapefiles
- shapefiles that show each
				proposed passing in the application area as a singular mapped point, in the
				application or challenged area containing attribute data showing the addresses
				of each point.
Polygon Shapefiles
- shapefiles delineating the
				general project area(s).
RSSI
- Received Signal Strength Indicator
				("RSSI"), is an estimated measure of power level that a wireless client device
				is receiving from an access point or router.
Challengers
- A unit of local government, a
				nonprofit organization, or Broadband Service Provider ('ISP").
Project Challenge Information Request
				Process
The purpose of this process is to ensure the Arkansas Economic
				Development Commission Broadband Office ("AEDC Broadband Office"), or its'
				designee, select the best projects that truly bridge the digital divide in
				Arkansas. This process is to gather additional information before making a
				final award. To streamline this process, challengers must provide point and
				polygon shapefiles as defined in this document. All shapefiles or KMZs must be
				functional. In addition, if someone submits information regarding a wireless
				project, the challenger is required to include shapefiles of heat maps
				indicating RSSI measures in the challenged area. The AEDC Broadband Office, or
				its' designee, may, at its' discretion, require any other kind of file to
				complete its analysis.
Planned service to a proposed project area is eligible for the
				purpose of a submission to the AEDC Broadband Office, or its' designee, if
				state or federal funds have been awarded or private funds will be used within a
				reasonable period of time. Additionally, the provider must be committed to
				providing service to the areas using private, state or federal funds. Areas
				adjacent to private, state or federally funded areas may be eligible to submit
				information to the AEDC Broadband Office, or its' designee, if the challenger
				demonstrates, to AEDC's Broadband Office or to its designee's satisfaction,
				existing awards or a self-funded project will cover the adjacent area. The
				challenger must commit to serving the adjacent areas, in writing, at speeds
				100mbps/100mbps symmetrical or greater. The challenger may be required to enter
				into a written agreement with the State to complete the adjacent project within
				a certain time frame. The State will not issue awards in the adjacent area as
				consideration for the agreement.
The AEDC Broadband Office recognizes the nature of wireless
				projects has an inherent potential for overlap. Recognizing the unique
				circumstances of this technology, wireless projects will be allowed to exceed
				the 25% overlap allowance of existing networks, provided the wireless signal
				strength, measured in RSSI, is less than -90 in those areas. It is the
				determination of the AEDC Broadband Office that RSSI measures below -90 are
				unable to reliably deliver broadband. AEDC Broadband Office, or its' designee,
				will post ARC projects, for challenges, twenty business days following the
				announcement of the challenge information request. The announcement will be on
				the AEDC Broadband Office website or its' designee's website. Challengers
				wishing to submit information to the AEDC Broadband Office, or its' designee,
				must provide the required information, in this section, no later than 5:00
				p.m., 20 business days after posting ARC projects - no exceptions.
Providers wishing to submit information to the AEDC Broadband
				Office, or its' designee, on multiple applications must submit information
				separately for each application. Challengers can submit information to the AEDC
				Broadband Office, or its' designee, concerning portions of a proposed project
				area without invalidating the entire project. AEDC Broadband Office, or its'
				designee, reserves the right to invalidate a portion(s) of a proposed project
				area, aggregate challenges by different providers to determine the percentage
				of serviceable units served in a proposed project area and invalidate
				insufficient submissions. Challengers must demonstrate that more than 10%, for
				wireline projects, or 25%, for wireless projects, of serviceable units in the
				project area have access to speeds at or above 100/20 mbps as of the date of
				the application or that the application is ineligible because of committed
				state or federal funding subject to the conditions described above. These
				percentages may be changed, by the AEDC Broadband Office, or its' designee,
				based on the funding source and federal guidance.
AEDC Broadband Office, or its designee, must receive all the
				information detailed below or the submission will be deemed incomplete and
				invalid. Challengers must provide:
1.
			 A signed, and notarized affidavit affirming the attached information is
			 true.
2. Current Federal
			 Communications Commission (FCC) Form 477 or equivalent.
3. Minimum/maximum speeds available for
			 residents and businesses in the proposed project area.
4. Number of serviceable units within the
			 proposed project area. Provide the speeds those serviceable units can receive,
			 including the technology, i.e., fiber, fixed wireless, etc.
5. Street level data of customers receiving
			 service within the proposed project area.
6. Point shapefiles that show each proposed
			 passing in the questioned area, designated by a singular mapped point, in the
			 questioned area containing attribute data showing the addresses of each point.
			 Polygon shapefiles delineating the area(s) of concern.
7. For wireless providers: Heat maps
			 indicating RSSI in the challenged area.
8. Using the project area map submitted by
			 the applicant, create a map indicating where the challenger's serviceable units
			 are in the proposed project area. Challengers are encouraged to submit
			 additional maps and information if necessary.
9. If submitting due to planned private,
			 state or federal funding, documentation detailing commitment to provide service
			 in or adjacent to the proposed project area is required.
AEDC Broadband Office, or its' designee, reserves the right to
				request verified speed tests on all or portion(s) of the questioned area. The
				AEDC Broadband Office, or its' designee reserves the right to require any
				awardee to re-scope their ARC application/project footprint and amend funding
				request post award. The AEDC Broadband Office, or its' designee, may also
				require any applicant to alter its' project and funding request if it is in the
				best interest of the state. After all information have been submitted and
				reviewed, the AEDC Broadband Office or its' designee will evaluate the
				additional information to determine if it will let the project footprint stand,
				be altered, or be removed. The AEDC Broadband Office or its' designee, after
				administrative review, will post the final project areas no later than 5:00pm
				two weeks after all information has been evaluated. Due to the volume of
				applications and submissions there can be necessary delays to this
				timeline.