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Financing BPL

Financing BPL. Steven E. Collier Vice President, Emerging Technologies. FINANCING BPL. OPTIONS Internal Resources Rural Lenders Commercial Lenders JV Partners. Rural Broadband Access Loans and Loan Guarantee Program. OBJECTIVE:

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Financing BPL

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  1. Financing BPL Steven E. Collier Vice President, Emerging Technologies

  2. FINANCING BPL OPTIONS • Internal Resources • Rural Lenders • Commercial Lenders • JV Partners

  3. Rural Broadband Access Loans and Loan Guarantee Program OBJECTIVE: “ . . . loans and loan guarantees to fund the cost of construction, improvement, or acquisition of facilities and equipment for the provision of broadband service in eligible rural communities.”

  4. Rural Broadband Access Loans and Loan Guarantee Program FOCUS: Residential broadband service

  5. Rural Broadband Access Loans and Loan Guarantee Program TECHNOLOGY: Neutral

  6. Rural Broadband Access Loans and Loan Guarantee Program CONSIDERATIONS: “ . . . not only whether broadband [is] physically available but also the quality of any existing broadband service.”

  7. Rural Broadband Access Loans and Loan Guarantee Program FUNDING • $1.45 billion designated as “no year money” (available until distributed) including: • $80 million as 4-percent direct loans • $80 million as loan guarantees • An additional $196 million proposed for fiscal year 2004 (Oct 1 – Sept 30)

  8. Rural Broadband Access Loans and Loan Guarantee Program ELIGIBLE BORROWERS • Cooperatives • Non-profit organizations • Limited dividend or mutual associations • Limited liability companies • Commercial organizations • Indian tribes or tribal organizations

  9. Rural Broadband Access Loans and Loan Guarantee Program DEFINITIONS • Broadband: Transmit data enabling send and receive of high-quality voice, data, graphics, and video • FCC standard of 200kbps up and down • May be revised upwards in the future

  10. Rural Broadband Access Loans and Loan Guarantee Program DEFINITIONS • Eligible Community: • 20,000 inhabitants or fewer • For Four-percent Loan program, 2,500 or less • Not in a standard metropolitan statistical area

  11. Rural Broadband Access Loans and Loan Guarantee Program PRIORITY • Eligible rural communities in which broadband is not available • Where no entity is committed to provide such service

  12. Rural Broadband Access Loans and Loan Guarantee Program RESTRICTIONS • To provide service in the same area as another applicant • To acquire stock, facilities or equipment of an applicant affiliate

  13. Rural Broadband Access Loans and Loan Guarantee Program RESTRICTIONS • Existing RUS borrowers who petition • demonstrate intent to provide broadband service within 2 years • petition within 90 days of a loan application from another potential provider

  14. Rural Broadband Access Loans and Loan Guarantee Program RESTRICTIONS • For operating expenses, customer terminal equipment (owned by consumer), or vehicles not used primarily in construction

  15. Rural Broadband Access Loans and Loan Guarantee Program RESTRICTIONS • More requirements than Broadband Pilot Program

  16. APPLICATION RUS Form 532 Market survey Detailed business plan Certified system design Rural Broadband Access Loans and Loan Guarantee Program

  17. APPLICATION Financial statements and forecasts Environmental report Certification of availability of broadband service Evidence of legal notification Rural Broadband Access Loans and Loan Guarantee Program

  18. APPLICATION http://www.usda.gov/rus/telecom/broadband.htm Rural Broadband Access Loans and Loan Guarantee Program

  19. And then you wait . . . Rural Broadband Access Loans and Loan Guarantee Program

  20. Rural Broadband Access Loans and Loan Guarantee Program CONTACT • Deborah Jackson • Broadband Team, Telecommunications Program, Rural Utilities Service • Djackson@rus.usda.gov • 202-720-8454

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