Vermont Business Magazine On October 25, 2021, the US Department of Agriculture (USDA) Rural Utilities Service (RUS) informed the Vermont Telephone Company, Inc (VTel) that a significant portion of their service area in Vermont will now be considered eligible for USDA ReConnect funding. VTel’s service areas that do not meet the current minimum broadband service speed threshold of 100 Mbps Download x 20 Mbps Upload will be removed from RUS Protected Borrower Status and considered eligible under the new ReConnect rules.
Because VTel has a large USDA loan to provide WI-FI service in much of the state, that shut most providers in Vermont, public and private, out of this funding stream. Now they can access it. This could be a big boost for broadband in Vermont, especially when combined with ARPA and other funding.
Separately, there is about $250 million in infrastructure money available from ARPA that is designated for broadband deployment.
This week, four of the 12 Communication Union Districts in Vermont received a total of $9.9 million to begin the construction process for laying fiber-optic lines in rural parts of the state. That effort will begin next year.
It will take about five years to build out the CUDs and bring broadband Internet service to all regions of the state.
The change in USDA eligibility is the direct result of Senator Leahy’s work as Chair of Senate Appropriations Committee through bill report language he was able to secure within the FY 2021 Appropriations bill under the Agriculture Appropriations section.
This will open a significant portion of the state on the USDA RUS’s provided service area map allowing those areas to now be eligible for funding. The only service areas covered by VTel that will not be eligible for ReConnect funding will be where they are providing fiber service that meets the minimum broadband service speed.
Expanding broadband service statewide across Vermont has long been a high priority for Leahy, and for the State of Vermont.
Background
Prior to this announcement, Vermont had significant areas that were considered served by wireless broadband that were built with funding from a RUS American Recovery and Reinvestment Act (ARRA) project.
These areas were ineligible for USDA ReConnect funding because they were considered “Prior Funded Service Areas” under RUS rules.
Even though many communities within this service area had internet speeds fall below 10/1 Mpbs, they were still ineligible due to that designation by RUS.
Leahy as Appropriations chairman was able secure language provisions in the Fiscal Year 2021 Appropriations bill that removed the “Prior Funded Service Areas” barrier for providers, such as VTel, that had previously received funding for broadband buildout.
Additionally, Leahy’s report language increased the minimum broadband service speed to 100/20 Mpbs.
Unfortunately, USDA RUS had already released their Notice of Funding Opportunity for FY21 ReConnect applications prior to the passage of the FY21 Appropriations bill and were not able to implement the changes in the last round of funding.
On October 22, 2021, USDA announced that the Department will begin accepting applications for up to $1.15 billion in loans and grants to expand the availability of broadband in rural areas.
Included within the funding announcement was the incorporation of the changes to the ReConnect Program secured by Chairman Leahy through his work on the Agriculture Appropriations Subcommittee.
In making funding decisions, USDA will prioritize projects that will serve low density rural areas with locations lacking internet access service at speeds of at least 25/3 Mbps.
Applicants must build out these areas to 100/100 Mbps.
The application portal will remain open until 11:59 a.m. Eastern on February 22, 2022, to give applicants ample time to apply and adapt to these new changes.