[Federal Register Volume 61, Number 105 (Thursday, May 30, 1996)]
[Proposed Rules]
[Pages 27230-27242]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13572]




[[Page 27229]]


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Part VI





Department of Commerce





_______________________________________________________________________



National Telecommunications and Information Administration



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15 CFR Part 2301



Public Telecommunications Facilities Program; Proposed Rule

  Federal Register / Vol. 61, No. 105 / Thursday, May 30, 1996 / 
Proposed Rules  

[[Page 27230]]



DEPARTMENT OF COMMERCE

National Telecommunications and Information Administration

15 CFR Part 2301

[Docket No. 960524148-6148-01]
RIN 0660-AA09


Public Telecommunications Facilities Program

AGENCY: National Telecommunications and Information Administration 
(NTIA), Commerce.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The National Telecommunications and Information Administration 
(NTIA) is issuing a Notice of Proposed Rulemaking. This Notice is 
intended to clarify and/or revise the rules and appendix governing 
administration of the Public Telecommunications Facilities Program 
(PTFP). The PTFP is authorized to provide matching grants to plan and 
construct public telecommunications facilities.1
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    \1\ See 47 U.S.C. 390-393, and 397-399b (1988), The 
Communications Act of 1934, as amended. Unless otherwise noted, all 
statutory citations are to title 47 of the United States Code.
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    NTIA intends to issue Final Rules after it has received, evaluated 
and addressed public comments on these Proposed Rules.

DATES: Comments must be filed no later than the close of business on 
July 15, 1996.

ADDRESSES: Persons and organizations interested in commenting on the 
Proposed Rules must send three copies of any comments to: Public 
Telecommunications Facilities Program, NTIA, Department of Commerce, 
14th Street and Constitution Avenue, NW, Room 4625, Washington, DC 
20230. Attention: Dennis Connors.

FOR FURTHER INFORMATION CONTACT: Persons desiring further information 
regarding the Proposed Rules should contact Dennis Connors, Public 
Telecommunications Facilities Program, NTIA, DOC, 14th Street and 
Constitution Avenue NW., Room 4625, Washington, DC 20230, telephone 
(202) 482-5802.

SUPPLEMENTARY INFORMATION: In March 1995, President Clinton issued a 
directive to Federal agencies regarding their responsibilities under 
his Regulatory Reform Initiative. This initiative is part of the 
National Performance Review and calls for immediate, comprehensive 
regulatory reform. The President directed that all agencies undertake 
an exhaustive review of all their regulations with an emphasis on 
eliminating or modifying those that are obsolete or otherwise in need 
of reform. These Proposed Rules represent the first step in NTIA's 
response to this directive for the PTFP.
    In keeping with the Presidential directive, NTIA has taken this 
opportunity to thoroughly review the existing 1991 Rules.2 We are 
proposing a number of changes discussed below which simplify or delete 
requirements. In order to clarify the rules, we have removed internal 
repetition as well as duplication of requirements set forth for 
grantees in other government rules and regulations.
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    \2\ See 15 CFR Part 2301, published in the Federal Register, 
Vol. 56, No. 226, p. 59168. (November 22, 1991).
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    The change most readily apparent to those familiar with the 1991 
Rules is that the Proposed Rules have been completely reorganized to 
make it easier for applicants and grantees to understand the 
requirements of the program. Additional headers have been added and 
minor language changes made to increase clarity. However, unless 
discussed further below, the intent of the regulations remains the same 
as in the 1991 Rules.
    The most significant policy change contained in the Proposed Rules 
includes a complete revision of the evaluation criteria which formerly 
was contained in two sections, Sec. 2301.13 Funding Criteria for 
Construction Applications and Sec. 2301.14 Funding Criteria for 
Planning Applications. The Proposed Rules combine both construction and 
planning evaluation criteria into a new Sec. 2301.17. The Proposed 
Rules also add a description of PTFP's technical evaluation process in 
Sec. 2301.16 and a description of the selection process used to award 
grants in Sec. 2301.18.
    Two clarifications have been made in the funding priorities, which 
previously were contained in the Appendix to the 1991 Rules and are now 
incorporated into the Proposed Rules at Sec. 2301.4. NTIA proposes to 
modify the former Priority 4, Replacement and Improvement of Basic 
Equipment for Existing Broadcast Stations. Under the proposed 
Sec. 2301.(4)(b)(4) NTIA has redesignated this section as Priority 4, 
Improvement of Public Broadcasting Services and expanded its scope. In 
addition to the projects formerly included under Priority 4, NTIA now 
will consider projects to construct public broadcast stations to 
address underserved needs in an area already served by other public 
broadcasting facilities. Under the previous funding priorities in the 
Appendix to the 1991 Rules, NTIA considered applications intended to 
serve areas already served by other public broadcasting facilities 
within the Special Applications category while other broadcast projects 
were considered within the funding Priorities. NTIA believes that all 
broadcast applications should be evaluated within the funding 
priorities. NTIA continues to believe that the PTFP's highest 
priorities are the provision of a first signal to a geographic area 
(Priority 1), urgent replacement of equipment at the sole station 
serving a geographic area (Priority 2), and first local origination 
(Priority 3). Therefore, projects to construct public broadcast 
stations to address underserved needs in an area already served by 
other public broadcasting facilities will be considered in Priority 4A, 
where they will be considered with other applications from stations in 
areas already served by another public broadcasting facility. The 
remainder of Priority 4A and Priority 4B remain unchanged from the 
Appendix to the 1991 Rules.
    With the proposed revision of Priority 4, all broadcast 
applications have been placed within the five funding priorities. The 
Special Applications category therefore will consist solely of 
nonbroadcast projects and the language of the Special Applications 
category has been revised at Sec. 2301.(4)(a).
    Under Sec. 390 of the Act, NTIA has the authority to consider 
applications which further the delivery of public telecommunications 
services to as many citizens in the United States as possible by the 
most efficient and economical means. NTIA recognizes that the issue of 
conversion to advanced digital technologies is of great importance for 
the future viability of public broadcasting facilities in the United 
States. NTIA believes that public broadcasters must adequately plan for 
the transition to advanced digital technologies and will therefore 
welcome applications which will assist in planning for the digital 
conversion of public broadcasting facilities.
    The following reviews each section of the Proposed Rules and 
compares it with similar sections in the 1991 Rules.

Section 2301.1  Program Purposes

    The new Sec. 2301.1 Program Purposes replaces Sec. 2301.2 Program 
Purposes in the 1991 Rules. This section of the 1991 Rules for the most 
part repeated the language contained in Sec. 393(b) of the Act. NTIA 
believes that the overall purposes of the PTFP are better expressed in 
Sec. 390 of the Act. This

[[Page 27231]]

section of the Act, restated in the new Sec. 2301.1, now serves as an 
introduction to the PTFP Regulations.

Section 2301.2  Definitions

    The new Sec. 2301.2 Definitions repeats for the most part 
Sec. 2301.1 Definitions in the 1991 Rules. The definition for the term 
``Non-Federal financial support'' has been deleted. The term is no 
longer used since the requirement to report on three years of Non-
Federal financial support (Sec. 2301.5(d)(2)(viii) of the 1991 Rules) 
has been deleted.
    Three new definitions have been added. A new definition for the 
term ``planning'' has been added to complement the definition for the 
term ``construction,'' and a new definition has been added for 
``closing date'' since the term is used throughout the Proposed Rules. 
Further, the definition of ``Federal interest period'' has been 
expanded to clarify that limitations on the use of Federally-funded 
public telecommunications facilities, such as the prohibition on the 
use PTFP funded equipment for the broadcast of advertisements (see 
Sec. 2301.19(a)(5)) or the restrictions on sectarian use (see 
Sec. 2301.19(b)) extend for the useful life of the equipment, whether 
or not this period extends beyond the 10 year Federal interest period. 
We are also adopting the definition of ``minorities'' which was 
previously set forth in our policy statement printed in the Federal 
Register, Vol. 44, No. 111, p. 33032.

Section 2301.3  Applicant Eligibility

    The new Sec. 2301.3 Applicant Eligibility was contained as a part 
of Secs. 2301.4(a), (b) and (e) Eligible Organizations and Projects of 
the 1991 Final Rules. On December 22, 1995, NTIA issued a notice and an 
amendment to the PTFP regulations in the Federal Register (60 FR 66491, 
Dec. 22, 1995) on its policy with regard to sectarian activities. The 
December 22, 1995 Notice revised the previous Sec. 2301.4 on 
eligibility. The revisions outlined in that Notice are included in the 
Proposed Rules in Sec. 2301.3. The process of obtaining preliminary 
eligibility determinations (Sec. 2301.3(d)) has been simplified and 
much of the prior language specifying this procedure (Sec. 2301.4(f) in 
the 1991 Rules) has been eliminated.

Section 2301.4  Scope of Projects

    The new Sec. 2301.4 Scope of Projects contains the material 
included in the Appendix to the 1991 Rules dealing with Special 
Applications and Priorities. This section replaces Sec. 2301.4(c) of 
the 1991 Rules, which for the most part was another paraphrase of 
Sec. 393(b) of the Act. We believe that it is more useful to applicants 
that this new Sec. 2301.4 contain the scope of eligible projects 
developed by NTIA to achieve the objectives of Sec. 393(b) of the Act. 
Significant changes in Sec. 2301.4(a) Special Applications and 
Sec. 2301.4(b)(4) Priority 4 applications were discussed earlier in 
this document. Sec. 2301.4(b)(1)(iv) adds language to clarify how PTFP 
considers the presence of AM daytime only stations in determining the 
Priority for proposed FM facilities serving a similar coverage area. 
Sec. 2301.4(c) parallels Sec. 2301.3(d) of the Proposed Rules in 
permitting potential applicants to obtain preliminary eligibility 
determinations. Sec. 2301.4(d) maintains the intent of 
Sec. 2301.4(f)(3) of the 1991 Rules that the Agency will review all 
applications after the closing date and that a preliminary eligibility 
determination does not guarantee that the Agency will accept a future 
application.

Section 2301.5  Special Consideration

    The new Sec. 2301.5 Special Consideration is based in part on 
Sec. 2301.3 Special Consideration in the 1991 Rules. The section has 
been revised to reflect language in the Act (Sec. 392(f)). The sentence 
regarding a requirement for special consideration of a minimum 50% 
level of control of the applicant by women and minorities has been 
deleted.

Section 2301.6  Amount of Federal Funding

    The new Sec. 2301.6 Amount of Federal Funding is based upon 
Sec. 2301.16 Amount of the Federal Grant in the 1991 Rules. Several 
sentences in this section have been rearranged within the section to 
group similar issues and increase the clarity of the regulation. We are 
also taking this opportunity to clarify PTFP's position on the level of 
matching funds required for broadcast equipment replacement, 
improvement and augmentation projects and to make it more consistent 
with treatment of non-Federal cost share under OMB Circular A-110 and 
15 CFR Part 24. The new Sec. 2301.6(b)(ii) is a restatement of NTIA 
policy previously published on November 22, 1991 (Fed. Reg. Vo. 56, No. 
226, p. 59191) which indicates the presumption of 50% Federal 
participation for equipment replacement, improvement and augmentation 
projects. New language in Sec. 2301.6(b)(2) clarifies NTIA's existing 
policy that obligating funds for equipment before the closing date is 
considered ownership or acquisition of equipment and is not normally 
permitted. However, NTIA will now consider on a case-by-base basis 
inclusion of equipment as matching funds purchased prior to the closing 
date due to unusual circumstances when a clear and compelling showing 
is made. Sec. 2301.6(d) has been revised to indicate that if a grantee 
obligates Federal funds before the project start date, those costs may 
be disallowed. This revision replaces language in the 1991 Rules 
(Sec. 2301.23(a)-(c)) which gave the Department the option of 
terminating the entire grant.

Section 2301.7  Eligible and Ineligible Project Costs

    The new Sec. 2301.7 Eligible and Ineligible Project Costs is based 
on Sec. 2301.17 Items and Costs Ineligible for Federal funds from the 
1991 Rules. Specific information on the eligible and ineligible costs 
has been deleted from this section. The new language formalizes a 
procedure that NTIA has been following in recent years, which is to 
annually publish a list of eligible and ineligible costs in the Federal 
Register as part of the solicitation of applications. The list will be 
distributed as part of the application materials. Sec. 2301.7(c) has 
been revised to reflect the change noted in the prior section regarding 
Sec. 2301.6(b)(2).

Section 2301.8  Submission of Applications

Section 2301.9  Deferred Applications

Section 2301.10  Applications Resulting From Catastrophic Damage or 
Emergency Situations

    The new Secs. 2301.8 Submission of Applications, 2301.9 Deferred 
Applications and 2301.10 Applications Resulting From Catastrophic 
Damage or Emergency Situations are all derived from Sec. 2301.5 
Application Procedures in the 1991 Rules. The former Sec. 2301.5 has 
been divided into three sections for clarity, but the application 
procedures contained in the three new sections are similar to that of 
the 1991 Rules. Lengthy sections from the old Sec. 2301.5 regarding the 
specific requirements to be submitted in a new or deferred application 
have been deleted (e.g. Secs. 2301.5(d)(2)(i-xxii)) and 2301.5(e)(4)(i-
xi). Removing the specific requirements from the Rules will give NTIA 
the flexibility of future reductions in requirements on the application 
form to lessen the burden on applicants. For example, in FY 1997, NTIA 
will, under the Proposed Rules, delete the requirement to submit the 
three year report on Non-Federal Financial Support (Exhibit B) now 
required by the 1991 Rules and contained in the current application 
form. Specific requirements of the application are now and will

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continue to be contained in the application form that will be 
distributed as part of application materials.
    The Proposed Rules drop the specific requirement in the 1991 Rules 
(Sec. 2301.5(d)(2)) that an applicant submit ``an original and one copy 
of the Agency application form'' but now specifies at the new 
Sec. 2301.8(d) that the applicant submit ``the number of copies 
specified by the Agency.'' This will permit NTIA to be flexible, within 
OMB guidelines, on the number of applications forms required in order 
to complete processing of the applications in a timely manner.
    Two paragraphs from the Additional Information section in the 1991 
Rules (Sec. 2301.6(d)(1) and (2)) were relocated to the new Submission 
of Applications section (Sec. 2301.8(g) and (h)) to notify potential 
applicants of the use of Name Check forms and financial responsibility 
determinations in the application review process. In Secs. 2301.8(g) 
and(h), the Proposed Rules clarify the uses of these reports in the 
application review process. The new Sec. 2301.8(i) is Department of 
Commerce policy.
    The new Sec. 2301.10 Applications Resulting From Catastrophic 
Damage or Emergency Situations contains one significant change from 
Sec. 2301.5(g) of the 1991 Rules. Under Sec. 2301.10(a), NTIA proposes 
to consider the complete failure of basic equipment essential to a 
station's continued operation, even if the failure is not the result of 
a natural or manmade disaster, as an emergency situation which may 
warrant immediate consideration of an application.

Section 2301.11  Service of Applications

    The new Sec. 2301.11 Service of Applications was the former 
Sec. 2301.7 Service of Applications in the 1991 Rules. Section 
Sec. 2301.11(c) has been clarified to indicate that applicants must 
notify the State Single Points of Contact (SPOC) in each state relevant 
to the project that an application for funding has been submitted to 
PTFP. In the opening sentence to this section, we further clarify that 
the notification to the SPOC, the FCC and the state telecommunications 
agencies need only be a summary of the application, rather than the 
full application required in prior PTFP Rules. Future application 
materials will provide guidance as to what should be included in the 
summary to provide adequate notification to the requisite agencies 
while reducing the notification burden on all applicants.

Section 2301.12  Federal Communications Commission Authorizations

    The new Sec. 2301.12 Federal Communications Commission 
Authorizations was the former 2301.8 Federal Communications Commission 
in the 1991 Rules. The section contains a few minor editorial 
improvements in (a), (c), and (g) with no change in intent.

Section 2301.13  Public Comments

    The new Sec. 2301.13 Public Comments is based on the former 
Sec. 2301.11 Public Comments in the 1991 Rules. Under the new 
Sec. 2301.13(a), NTIA intends to publish a list of all applications 
received. This replaces the publishing of a list of applications 
accepted for filing (Sec. 2301.9(a) contained in the 1991 Rules.) The 
former listing of applications accepted for filing was often 
incomplete, as determinations of eligibility were sometimes made after 
the publication of the notice. NTIA believes that publication of a full 
listing of applications received can be done soon after the closing 
date, and better serves the public by permitting a longer period of 
time for receipt of public comments. Sec. 2301.13(c) clarifies that 
copies of the applications are available for public inspection in the 
NTIA offices. The new Sec. 2301.13(d) has been modified to clarify that 
only those public comments which oppose an application must be served 
on the applicant. Sec. 2301.13(e) clarifies the use of the public 
comments.

Section 2301.14  Supplemental Application Information

    The new Sec. 2301.14 Supplemental Application Information is based 
on Sec. 2301.6 Additional Information from the 1991 Rules. Paragraph 
(b)(4) of this section has been revised to reduce the burden on 
applicants. Where the 1991 rules require notification to NTIA of any 
changes in the applicants ``board structure, in the applicant's 
501(c)(3) status, or in the applicant's Articles of Incorporation or 
Bylaws,'' the Proposed Rules only require notification to NTIA of 
changes ``that affect the applicant's eligibility.'' In the new 
organization of the Proposed Rules, several paragraphs have been moved 
into or out of this section. Sec. 2301.15(f)(1) of the 1991 Rules was 
moved into this section and is now contained in the new 
Sec. 2301.14(d). As previously noted, two paragraphs from the 
Additional Information section in the 1991 Rules (Secs. 2301.6(d) (1) 
and (2)) were relocated to the new Submission of Applications section 
(Secs. 2301.5 (h) and (i)).

Section 2301.15

    Withdrawal of Applications
    The new Sec. 2301.15 Withdrawal of Applications is taken from 
Sec. 2301.9(g) of the 1991 Rules and placed in this separate section 
for clarity. The section has been slightly revised with no change in 
intent.

Section 2301.16  Technical Evaluation Process

    The new Sec. 2301.16 Technical Evaluation Process combines elements 
from several sections in the 1991 Rules. The new Sec. 2301.16(a) is 
based on Sec. 2301.13 of the 1991 Rules. Secs. 2301.16 (c), (d), and 
(e) parallel the procedures currently used by NTIA in the review of the 
PTFP applications and are similar to the information contained in the 
Notice of Closing Date for the FY 1996 Grant Cycle, published in the 
Federal Register on February 22, 1996 (FR xxx). The new Sec. 2301.16(d) 
is also based on Secs. 2301.12 (b) and (c) of the 1991 Rules.

Section 2301.17  Evaluation Criteria for Construction and Planning 
Applications

    The new Sec. 2301.17 Evaluation Criteria for Construction and 
Planning Applications is totally new and replaces Sec. 2301.13 Funding 
Criteria for Construction Applications and Sec. 2301.14 Funding 
Criteria for Planning Applications in the 1991 Rules. The new 
Sec. 2301.17 proposes six broad criteria upon which the applications 
will be evaluated. These are: Project Objectives, Applicant 
Qualifications, Urgency, Financial Qualifications, Special 
Consideration, and either Technical Qualifications (for construction 
projects) or Planning Qualifications (for planning projects). This new 
section combines the evaluation criteria for planning and construction 
applications in one place, reduces redundancy and clarifies the 
evaluation criteria. The Agency will provide each applicant with 
guidance in the application materials on the appropriate type of 
documentation to meet each of the evaluation criteria which reflects 
the type and priority of the application being proposed. We have not 
assigned a weight to each of the criterion. In prior years, we have 
weighted all criteria equally. We are soliciting comment on the 
appropriate weights to be assigned.

Section 2301.18  Selection Process

    The new Sec. 2301.18 Selection Process is a new section which 
serves to distinguish the evaluation factors used in Sec. 2301.17 from 
those additional factors used in the selection of the grant. 
Secs. 2301.18 (a) and (b) parallel the procedures currently used by 
NTIA in

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the selection of the PTFP applications for funding and are similar to 
the information contained in the Notice of Closing Date for the FY 1996 
Grant Cycle, published in the Federal Register on February 22, 1996 
(Fed. Reg. Vol. 61, No. 36, p. 6912). The new Sec. 2301.18(c) is the 
same as Sec. 2301.8(h) of the 1991 Rules. The new Secs. 2301.16 (d) and 
(e) are based on Sec. 2301.15 (a) and (b) of the 1991 Rules.

Section 2301.19  General Conditions Attached to the Federal Award

    The new Sec. 2301.19 General Conditions Attached to the Federal 
Award is the first of several new sections which are derived from 
Sec. 2301.22 Conditions Attached to the Federal Award in the 1991 
Rules. The new Sec. 2301.19 combines, in order, the following 
paragraphs from Sec. 2301.22 of the 1991 Rules, (b)(1), (2), (3), (16), 
(4), (5), (11), and 2301.22(d). The remainder of Sec. 2301.22 in the 
1991 Rules has been included in other sections as discussed below or 
deleted as unnecessary. The new Sec. 2301.19(c) is based on 
Sec. 2301.23(c)(1) of the 1991 rules with the last two sentences of the 
new Sec. 2301.19(c) added for clarity.

Section 2301.20  Schedules and Reports

    The new Sec. 2301.20 Schedules and Reports is based on 
Secs. 2301.22(b) (8) and (12) Conditions Attached to the Federal Grant 
in the 1991 Rules. These two paragraphs have been given their own 
section for clarity. Several adjoining paragraphs, including 
Secs. 2301.22(b) (9)-(11) and (13)-(17) have been deleted as 
unnecessary as they are redundant with other sections of the Proposed 
Rules or restate other law or OMB circulars.

Section 2301.21  Payment of Federal Funds

    The new Sec. 2301.21 Payment of Federal Funds is based on 
Sec. 2301.18 Payment of the Federal Grant of the 1991 Rules. 
Sec. 2301.18(c) was removed from this section of the 1991 Rules and was 
relocated to the new Sec. 2301.20(c) as more appropriate.

Section Sec. 2301.22  Protection, Acquisition and Substitution of 
Equipment

    The new Sec. 2301.22 Protection, Acquisition and Substitution of 
Equipment, is based on Secs. 2301.22(a) and 2301.22(b)(7) of the 1991 
Rules. Several portions of these paragraphs have been deleted as 
redundant with other sections of the Proposed Rules. The new 
Sec. 2301.22 includes several changes designed to provide the Agency 
with flexibility in administering the program and to lessen the 
regulatory impact on grantees. These changes deal with the conditions 
under which a grantee is required to provide evidence of liens, 
insurance and leases sufficient to protect the Federal government's 10 
year reversionary interest in the PTFP funded equipment. The 1991 Rules 
do not provide NTIA with any flexibility in requiring these items. The 
Proposed Rules discuss the requirements that a grantee protect the 
Federal government's interest in PTFP funded equipment by obtaining 
insurance, having sufficient lease/ownership rights to property, and 
securing the Federal interest by a lien. However, the Proposed Rules 
delete specific ways that these items must be documented to the Agency. 
For example, the new Sec. 2301.22(a) reduces a prior ``The grantee 
shall'' in the 1991 Rules (Sec. 2301.18(a)) to the lesser ``The Agency 
may require a grantee to'' provide liens within 90 days after a grant 
award is received. Language reflecting this approach also appears in 
Secs. 2301.22(g)(4), 2301.23((b)(8) and 2301.25(b). Likewise, specific 
requirements for an attorney's letter of certification on property 
lease/ownership right is also deleted from the regulations. NTIA would 
like to explore alternate ways to protect the Federal interest which 
will reduce the burden on grantees. We are therefore proposing to 
revise these sections of the Proposed Rules to permit this future 
flexibility.
    The new Sec. 2301.22(e) replaces Sec. 2301.22(c) of the 1991 Rules. 
NTIA is proposing to delete several restrictions on the lease of 
equipment, specifically the former Sec. 2301.22(c)(1), which required 
that the lease be for ``not less than the (10) years,'' and 
Sec. 2301.22(c)(2), which limited the cost of the lease to ``not be 
more than the total of the non-Federal share of the matching funds.'' 
NTIA believes that these statements were overly restrictive and now 
proposes to consider any lease that is to the ``benefit to the Federal 
government'' (new Sec. 2301.22(e)(1)).
    The new Secs. 2301.22 (f)-(h) are based on Sec. 2301.23 (c) and (d) 
Grant Suspension, Terminations and Transfers in the 1991 Rules and have 
been revised for clarity.

Section 2301.23  Completion of Projects

    The new Sec. 2301.23 Completion of Projects is based on 
Sec. 2301.20 Completion of Projects in the 1991 Rules. Several 
paragraphs have been renumbered and minor changes have been made in 
Secs. 2301.23(a)(4) and (b)(1) to improve clarity. The requirement in 
Sec. 2301.23(b)(4) to provide a copy of the insurance policy has been 
dropped inasmuch as the same paragraph requires that the grantee must 
certify its insurance coverage. Paragraph Sec. 2301.24(c) was contained 
in Sec. 2301.18 in the 1991 Rules and is more appropriate in this 
section. This sentence has been revised to clarify that the project 
completion date is usually the date on which the project period expires 
unless the grantee certifies in writing prior to the project period 
expiration date that the project is complete.

Section 2301.24  Final Federal Payment

    The new Sec. 2301.24 Final Federal Payment is a revision of 
Sec. 2301.16(d) of the 1991 Rules. This paragraph was given its own 
section in the Proposed Rules for clarity. The language of the section 
has been simplified without changing the intent.

Section 2301.25  Retention of Record and Annual Status Reports

    The new Sec. 2301.25 Retention of Records and Annual Status Reports 
is based on Sec. 2301.19 Retention of Records and Sec. 2301.21 Annual 
Status Reports for Construction Projects in the 1991 Rules. The section 
was shortened and the language retained notifies applicants and 
grantees of NTIA's basic record keeping requirements. Further 
information on records retention will be included in materials sent to 
grantees at the time an award is made. The detailed procedural 
information that is required in the annual status report has been 
deleted from the proposed rule and will be provided to grantees at the 
time a project is closed out.

Section 2301.26  Waivers

    The new Sec. 2301.26 Waivers is based on Sec. 2301.25 Waivers in 
the 1991 Rules. A sentence was added to clarify the Administrator's 
waiver authority.
    One significant section of the 1991 Rules has been deleted in its 
entirety. This is Sec. 2301.10 Appeals. Applicants are given the 
opportunity to request a preliminary determination of eligibility, and 
are provided written notice. The Appeals process was rarely used.
    We are also taking this opportunity to restate several long 
standing PTFP policies which were published in the preambles of 
previous PTFP rules. The following policies remain in effect:

Evidence of Tax-Exempt Status

    Applicants who are eligible for a Section 501(c)(3) exemption from 
the IRS or the equivalent exemption from the Commonwealth of Puerto 
Rico must

[[Page 27234]]

submit a copy of that exemption. Applicants who are ineligible for 
Section 501(c)(3) exemption but who can demonstrate nonprofit status by 
showing an applicable State tax exemption will be considered on a case-
by-case basis. They must submit: (a) evidence of their State tax-exempt 
status; (b) citation to, and a copy of, the State statutory provisions 
governing that exemption; and (c) a brief statement explaining why they 
lack a Section 501(c)(3) exemption. (Fed. Reg. Vol. 44, No. 104, p. 
30899)

Equipment Which Becomes Obsolete Before the end of the 10 Year Period 
of Federal Interest

    In the case of equipment which become obsolete or wears out before 
the 10-year period of Federal interest expires, we will permit the 
trade-in or sale of the equipment and application of the remaining 
portion of the 10-year period to the new equipment. (Fed. Reg. Vol. 44, 
No. 104, p. 30910)

Selection of Priority

    In preparing the narrative portions of its application, each 
applicant should state under which priority it desires NTIA to consider 
its application. In doing so, each applicant makes sure that its 
application contains sufficient documentation to justify its 
qualification under the selected priority. NTIA will then evaluate the 
application with the selected priority unless the Agency determines 
that the priority selected by the applicant is not supported by the 
documentation provided. Each applicant will be notified of any change 
in the priority under which its application is to be considered. Such 
notifications will be in writing and will not be subject to appeal. 
(Fed. Reg. Vol. 47, No. 228, p. 53653)

Award of Deferred Applications

    The Administrator retains the discretion to award grants to 
deferred applications at any time where the Administrator can determine 
with reasonable certainty that the particular project is exceptionally 
meritorious (on the basis of the Agency's preliminary determination of 
all other applications within the priority) and that the Agency would 
fund the project after completing the evaluation of all the application 
in the priority (on the basis of the Agency's prior experience in 
making grants.) Under this process, the Agency will be able to fund 
applications that the Agency had deferred in the prior year because of 
technical problems (such as the inability to obtain the necessary FCC 
authorizations) which have since been eliminated. (Fed. Reg. Vol. 47. 
No. 50, p. 11232.)

Support for Salary Expenses

    NTIA regards its primary mandate to be funding the acquisition of 
equipment and only secondarily the funding of salary expenses, even 
when allowed by law. Moreover, NTIA notes that the competition for PTFP 
funding remains intense. To ensure that PTFP monies are distributed as 
effectively as possible in this competitive atmosphere, NTIA must weigh 
carefully its support for any project cost not directly involved with 
the purchase of equipment.
    Therefore, NTIA generally will not fund salary expenses, including 
staff installation costs, pre-application legal and engineering fees, 
and pre-operational expenses of new entities. NTIA will support such 
costs only when the applicant demonstrates that exceptional need exists 
or that substantially greater efficiency would result from the use of 
staff installation instead of contractor installation.
    As regards the installation of transmission equipment, NTIA 
strongly favors the use of either manufacturer or professional 
contractor personnel and commonly funds these costs. NTIA believes that 
the value of transmission equipment and the complicated nature of its 
installation require expertise beyond that normally found on station 
staffs.
    NTIA will rarely support requests for assistance for the 
installation of studio and test equipment, whether that installation is 
by staff or by contract employees. Such installation is normally of 
minimum difficulty, and the associated installation costs should be 
absorbed in the recipient's normal operating budget. Again, NTIA will 
take into account demonstrations of exceptional need. (Fed. Reg. Vol. 
56, No. 226, p. 59172)
    It has been determined that this rule is not significant for 
purposes of Executive Order (E.O.) 12866.
    A Regulatory Flexibility Analysis is not required under The 
Regulatory Flexibility Act (5 U.S.C. 601 et seq.) because the rules 
were not required to be promulgated as proposed rules before issuance 
as final rules by Sec. 553 of the Administrative Procedures Act (5 
U.S.C. 553) or by any other law. This rule does not contain policies 
with Federalism implications sufficient to warrant preparation of a 
Federalism assessment under Executive Order 12612.
    The Department has determined that these rules will not 
significantly affect the quality of the human environment. Therefore, 
no draft or final Environmental Impact Statement has been or will be 
prepared. Notwithstanding any other provision of law, no person is 
required to respond to nor shall a person be subject to a penalty for 
failure to comply with a collection of information subject to the 
requirements of the Paperwork Reduction Act unless that collection of 
information displays a currently valid OMB Control Number.
    The Office of Management and Budget has approved the information 
collection requirements contained in these rules pursuant to the 
Paperwork Reduction Act under OMB Control Nos. 0660-0003, 0660-0001 and 
0605-0001. The public reporting burden for the application requirements 
vary from 16 hours to 200 hours with an estimated average of 125 hours 
per application, including associated exhibits; the reporting and 
record keeping burden for the grant monitoring reports vary from 1 to 
24 hours depending on the respective requirement; and, the reporting 
burden for the name-check form (CD-346) is estimated at 15 minutes. 
These estimates include the time for reviewing instructions, searching 
existing data sources, gathering and maintaining the data needed, and 
completing and reviewing the collections of information. Send comments 
regarding these burden estimates, or any other aspects of the 
collections of information, including suggestions for reducing this 
burden, to the Office of Policy and Coordination and Management, NTIA, 
U.S. Department of Commerce, Washington, D.C. 20230; and to the Office 
of Information and Regulatory Affairs, Office of Management and Budget, 
Washington, D.C. 20503 (Attention: NTIA Desk Officer).

(Catalogue of Federal Domestic Assistance No. 11.550)

List of subjects in 15 CFR Part 2301

    Administrative procedure, Grant programs--communications, Reporting 
requirements, Telecommunications.
Larry Irving,
Administrator.

    Part 2301 of Title 15, Code of Federal Regulations, is proposed to 
be revised to read as follows:

PART 2301--PUBLIC TELECOMMUNICATIONS FACILITIES PROGRAM

Subpart A--General

Sec.
2301.1  Program purposes.
2301.2  Definitions.

[[Page 27235]]

Subpart B--Application Requirements

2301.3  Applicant eligibility.
2301.4  Scope of projects.
2301.5  Special consideration.
2301.6  Amount of Federal funding.
2301.7  Eligible and ineligible project costs.
2301.8  Submission of applications.
2301.9  Deferred applications.
2301.10  Applications resulting from catastrophic damage or 
emergency situations.
2301.11  Service of applications.
2301.12  Federal Communications Commission authorizations.
2301.13  Public comments.
2301.14  Supplemental application information.
2301.15  Withdrawal of applications.

Subpart C: Evaluation and Selection Process

2301.16  Technical evaluation.
2301.17  Evaluation criteria for construction and planning 
applications.
2301.18  Selection process.

Subpart: D: Post-Award Requirements

2301.19  General conditions attached to the Federal Award.
2301.20  Schedules and reports.
2301.21  Payment of Federal funds.
2301.22  Protection, acquisition and substitution of equipment.

Subpart E: Completion of Projects

2301.23  Completion of projects.
2301.24  Final Federal payment.
2301.25  Retention of records and annual status reports.

Subpart F: Waivers

2301.26  Waivers.

    Authority: The Public Telecommunications Financing Act of 1978, 
as amended, 47 U.S.C. Secs. 390-393 (Act). (Catalog of Federal 
Domestic Assistance No. 11.550)

Subpart A--General


Sec. 2301.1  Program Purposes.

    Pursuant to section 390 of the Act, (The Communications Act of 
1934, as amended), the purpose of the Public Telecommunications 
Facilities Program (PTFP) is to assist, through matching grants, in the 
planning and construction of public telecommunications facilities in 
order to achieve the following objectives:
    (a) Extend delivery of public telecommunications services to as 
many citizens in the United States as possible by the most efficient 
and economical means, including the use of broadcast and nonbroadcast 
technologies;
    (b) Increase public telecommunications services and facilities 
available to, operated by, and owned by minorities and women; and
    (c) Strengthen the capability of existing public television and 
radio stations to provide public telecommunications services to the 
public.


Sec. 2301.2  Definitions.

    Act means Part IV of Title III of the Communications Act of 1934, 
47 U.S.C. 390-393 and 397-399b, as amended.
    Administrator means the Assistant Secretary for Communications and 
Information of the United States Department of Commerce who is also 
Administrator of the National Telecommunications and Information 
Administration.
    Agency means the National Telecommunications and Information 
Administration of the United States Department of Commerce.
    Broadcast means the distribution of electronic signals to the 
public at large using television (VHF or UHF) or radio (AM or FM) 
technologies.
    Closing date means the date which the Administrator sets as the 
deadline for the receipt of applications during a grant cycle.
    Construction (as applied to public telecommunications facilities) 
means acquisition (including acquisition by lease), installation, and 
improvement of public telecommunications facilities and preparatory 
steps incidental to any such acquisition, installation or improvement.
    Department means the United States Department of Commerce.
    FCC means the Federal Communications Commission.
    Federal interest period means the period of time during which the 
Federal government retains a reversionary interest in all facilities 
constructed with Federal grant funds. This period begins with the 
purchase of the facilities and continues for ten (10) years after the 
official completion date of the project. Although OMB Circular A-110 
Secs. ____.33 and ____.34 and 15 CFR 24.31 and 24.32, specify that the 
Federal government maintains a reversionary interest in the facilities 
for as long as the facilities are needed for the originally authorized 
purpose, PTFP's authorizing statute (47 U.S.C. 392(g)) limits the 
reversionary period for ten years for purposes of this program. 
However, Federal limitations on the use of the facilities survive for 
the useful life of the facilities whether or not this period extends 
beyond the ten year Federal interest period.
    Minorities means American Indians, Alaska Natives, Asian or Pacific 
Islanders, Hispanics, and Blacks, not of Hispanic Origin.
    Nonbroadcast means the distribution of electronic signals by a 
means other than broadcast technologies. Examples of nonbroadcast 
technologies are Instructional Television Fixed Service (ITFS), 
satellite systems, and coaxial or fiber optic cable.
    Noncommercial educational broadcast station or public broadcast 
station means a television or radio broadcast station that is eligible 
to be licensed by the FCC as a noncommercial educational radio or 
television broadcast station and that is owned (controlled) and 
operated by a state, a political or special purpose subdivision of a 
state, public agency or nonprofit private foundation, corporation, 
institution, or association, or owned (controlled) and operated by a 
municipality and transmits only noncommercial educational, cultural or 
instructional programs.
    Noncommercial telecommunications entity means any enterprise that 
is owned (controlled) and operated by a state, a political or special 
purpose subdivision of a state, a public agency, or a nonprofit private 
foundation, corporation, institution, or association; and that has been 
organized primarily for the purpose of disseminating audio or video 
noncommercial educational, cultural or instructional programs to the 
public by means other than a primary television or radio broadcast 
station, including, but not limited to, coaxial cable, optical fiber, 
broadcast translators, cassettes, discs, satellite, microwave or laser 
transmission.
    Nonprofit (as applied to any foundation, corporation, institution, 
or association) means a foundation, corporation, institution, or 
association, no part of the net earnings of which inures, or may 
lawfully inure, to the benefit of any private shareholder or 
individual.
    Operational cost means those approved costs incurred in the 
operation of an entity or station such as overhead labor, material, 
contracted services (such as building or equipment maintenance), 
including capital outlay and debt service.
    Planning (as applied to public telecommunications facilities) means 
activities to form a project for which PTFP construction funds may be 
obtained.
    Pre-operational costs means all nonconstruction costs incurred by 
new public telecommunications entities before the date on which they 
began providing service to the public, and all nonconstruction costs 
associated with the expansion of existing stations before the date on 
which such expanded capacity is activated, except that such costs shall 
not include any portion of the salaries of any personnel employed by an 
operating public telecommunications entity.

[[Page 27236]]

    PTFP means the Public Telecommunications Facilities Program, which 
is administered by the Agency.
    PTFP Director means the Agency employee who recommends final action 
on public telecommunications facilities applications and grants to the 
Administrator.
    Public telecommunications entity means any enterprise which is a 
public broadcast station or noncommercial telecommunications entity and 
which disseminates public telecommunications services to the public.
    Public telecommunications facilities means apparatus necessary for 
production, interconnection, captioning, broadcast, or other 
distribution of programming, including but not limited to studio 
equipment, cameras, microphones, audio and video storage or processors 
and switchers, terminal equipment, towers, antennas, transmitters, 
remote control equipment, transmission line, translators, microwave 
equipment, mobile equipment, satellite communications equipment, 
instructional television fixed service equipment, subsidiary 
communications authorization transmitting and receiving equipment, 
cable television equipment, optical fiber communications equipment, and 
other means of transmitting, emitting, storing, and receiving images 
and sounds or information, except that such term does not include the 
buildings to house such apparatus (other than small equipment shelters 
that are part of satellite earth stations, translators, microwave 
interconnection facilities, and similar facilities).
    Public telecommunications services means noncommercial educational 
and cultural radio and television programs, and related noncommercial 
instructional or informational material that may be transmitted by 
means of electronic communications.
    Sectarian means that which has the purpose or function of advancing 
or propagating a religious belief.
    State includes each of the fifty states, the District of Columbia, 
the Commonwealth of Puerto Rico, the Virgin Islands, Guam, American 
Samoa, and the Northern Mariana Islands.
    System of public telecommunications entities means any combination 
of public telecommunications entities acting cooperatively to produce, 
acquire or distribute programs, or to undertake related activities.

Subpart B--Application Requirements


Sec. 2301.3  Applicant eligibility.

    (a) To apply for and receive a PTFP Construction or Planning Grant, 
an applicant must be:
    (1) A public or noncommercial educational broadcast station;
    (2) A noncommercial telecommunications entity;
    (3) A system of public telecommunications entities;
    (4) A nonprofit foundation, corporation, institution, or 
association organized primarily for educational or cultural purposes; 
or,
    (5) A state, local, or Indian tribal government (or agency 
thereof), or a political or special purpose subdivision of a state.
    (b) An applicant whose proposal requires an authorization from the 
FCC must be eligible to receive such authorization.
    (c) If an applicant does not meet the eligibility requirements of 
this section, the application may be rejected and returned without 
further consideration.
    (d) An applicant may request a preliminary determination of 
eligibility any time prior to the closing date.


Sec. 2301.4  Scope of projects.

    An eligible applicant may file an application with the Agency for a 
planning or construction grant. To achieve the objectives set forth at 
47 U.S.C. 393(b), the Agency has developed the following categories. 
Each application shall be identified as a broadcast or nonbroadcast 
project and must fall within at least one of the following categories:
    (a) Special applications. NTIA possesses the discretionary 
authority to recommend awarding grants to eligible nonbroadcast 
applicants whose proposals are so unique or innovative that they do not 
clearly fall within the priorities listed in paragraph (b) of this 
section. Innovative projects submitted under this category must address 
demonstrated and substantial community needs (e.g., service to the 
blind or deaf and nonbroadcast projects offering educational or 
instructional services).
    (b) Priorities. (1) Priority 1--Provision of Public 
Telecommunications Facilities for First Radio and Television Signals to 
a Geographic Area. Within this category, NTIA establishes three 
subcategories:
    (i) Priority 1A. Projects that include local origination capacity. 
This subcategory includes the planning or construction of new 
facilities that can provide a full range of radio and/or television 
programs, including material that is locally produced. Eligible 
projects include new radio or television broadcast stations, new cable 
systems, or first public telecommunications service to existing cable 
systems, provided that such projects include local origination 
capacity.
    (ii) Priority 1B. Projects that do not include local origination 
capacity. This subcategory includes projects such as increases in tower 
height and/or power of existing stations and construction of 
translators, cable networks, and repeater transmitters that will result 
in providing public telecommunications services to previously unserved 
areas.
    (iii) Priority 1C. Projects that provide first nationally 
distributed programming. This subcategory includes projects that 
provide satellite downlink facilities to noncommercial radio and 
television stations that would bring nationally distributed programming 
to a geographic area for the first time.
    (iv) Priority 1 and its subcategories apply only to grant 
applicants proposing to plan or construct new facilities to bring 
public telecommunications services to geographic areas that are 
presently unserved, i.e., areas that do not receive public 
telecommunications services (It should be noted that television and 
radio are considered separately for the purposes of determining 
coverage. In reviewing applications from FM stations that propose to 
serve, or that already serve, areas covered by AM-daytime only 
stations, PTFP will evaluate the amount of service provided via the AM-
daytime only station in determining whether the FM proposal qualifies 
for a Priority 1 or Priority 2, as appropriate.)
    (v) An applicant proposing to plan or construct a facility to serve 
a geographical area that is presently unserved should indicate the 
number of persons who would receive a first public telecommunications 
signal as a result of the proposed project.
    (2) Priority 2--Replacement of Basic Equipment of Existing 
Essential Broadcast Stations.
    (i) Projects eligible for consideration under this category include 
the urgent replacement of obsolete or worn out equipment at ``essential 
stations'' (i.e., existing broadcast stations that provide either the 
only public telecommunications signal or the only locally originated 
public telecommunications signal to a geographical area).
    (ii) To show that the urgent replacement of equipment is necessary, 
applicants must provide documentation indicating excessive downtime, or 
a high incidence of repair (i.e., copies of repair records, or letters 
documenting

[[Page 27237]]

non-availability of parts). Additionally, applicants must show that the 
station is the only public telecommunications station providing a 
signal to a geographical area or the only station with local 
origination capacity in a geographical area.
    (iii) The distinction between Priority 2 and Priority 4 is that 
Priority 2 is for the urgent replacement of basic equipment for 
essential stations. Where an applicant seeks to ``improve'' basic 
equipment in its station (i.e., where the equipment is not ``worn 
out''), or where the applicant is not an essential station, NTIA would 
consider the applicant's project under Priority 4.
    (3) Priority 3--Establishment of a First Local Origination Capacity 
in a Geographical Area.
    (i) Projects in this category include the planning or construction 
of facilities to bring the first local origination capacity to an area 
already receiving public telecommunications services from distant 
sources through translators, repeaters, or cable systems,
    (ii) Applicants seeking funds to bring the first local origination 
capacity to an area already receiving some public telecommunications 
services may do so, either by establishing a new (and additional) 
public telecommunications facility, or by adding local origination 
capacity to an existing facility. A source of a public 
telecommunications signal is distant when the geographical area to 
which the source is brought is beyond the grade B contour of the 
origination facility.
    (4) Priority 4--Improvement of Public Broadcasting Services:
    (i) Projects eligible for consideration under this category are 
intended to improve the delivery of public broadcasting services to a 
geographic area. These projects include the establishment of a public 
broadcast facility to serve a geographic area already receiving public 
telecommunications services, projects for the replacement of basic 
obsolete or worn-out equipment at existing public broadcasting 
facilities and the upgrading of existing origination or delivery 
capacity to current industry performance standards (e.g., improvements 
to signal quality, and significant improvements in equipment 
flexibility or reliability). As under Priority 2, applicants seeking to 
replace or improve basic equipment under Priority 4 should show that 
the replacement of the equipment is necessary by including in their 
applications data indicating excessive downtime, or a high incidence of 
repair (such as documented in repair records). Within this category, 
NTIA establishes two subcategories:
    (ii) Priority 4A.
    (A) Applications to replace urgently needed equipment from public 
broadcasting stations that do not meet the Priority 2 criteria because 
they do not provide either the only public telecommunications signal or 
the only locally originated public telecommunications signal to a 
geographic area. NTIA will also consider applications that improve as 
well as replace urgently needed production-related equipment at public 
radio and television stations that do not qualify for Priority 2 
consideration but that produce, on a continuing basis, significant 
amounts of programming distributed nationally to public radio or 
television stations.
    (B) The establishment of public broadcasting facilities to serve a 
geographic area already receiving public telecommunications services. 
The applicant must demonstrate that it will address underserved needs 
in an area which significantly differentiates its service from what is 
already available in its service area.
    (C) The acquisition of satellite downlinks for public radio 
stations in areas already served by one or more full-service public 
radio stations. The applicant must demonstrate that it will broadcast a 
program schedule that does not merely duplicate what is already 
available in its service area.
    (D) The acquisition of the necessary items of equipment to bring 
the inventory of an already-operating station to the basic level of 
equipment requirements established by PTFP. This is intended to assist 
stations that went on the air with a complement of equipment well short 
of what the Agency considers as the basic complement.
    (iii) Priority 4B. The improvement and non-urgent replacement of 
equipment at any public broadcasting station.
    (5) Priority 5 Augmentation of Existing Broadcast Stations. 
Projects in this category would equip an existing station beyond a 
basic capacity to broadcast programming from distant sources and to 
originate local programming.
    (i) Priority 5A. Projects to equip auxiliary studios at remote 
locations, or to provide mobile origination facilities. An applicant 
must demonstrate that significant expansion in public participation in 
programming will result. This subcategory includes mobile units, 
neighborhood production studios, or facilities in other locations 
within a station's service area that would make participation in local 
programming accessible to additional segments of the population.
    (ii) Priority 5B. Projects to augment production capacity beyond 
basic level in order to provide programming or related materials for 
other than local distribution. This subcategory would provide equipment 
for the production of programming for regional or national use. Need 
beyond existing capacity must be justified.
    (c) An applicant may request a preliminary determination of whether 
a proposed project fits within at least one of the categories listed in 
this section any time prior to the closing date.
    (d) All applications will be reviewed after the closing date. If an 
application does not fall within one of the listed categories, it may 
be rejected and returned without further consideration.


Sec. 2301.5  Special consideration.

    In accordance with section 392(f) of the Act, the Agency will give 
special consideration to applications that foster ownership of, 
operation of, and participation in public telecommunications entities 
by minorities and women. The special consideration element is provided 
as one of several funding criteria contained in the regulations, 
specifically, at 15 CFR section 2301.17(b)(6).


Sec. 2301.6  Amount of Federal funding.

    (a) Planning grants. The Agency may provide up to one hundred (100) 
percent of the funds necessary for the planning of a public 
telecommunications construction project.
    (b) Construction grants. (1) A Federal grant for the construction 
of a public telecommunications facility may not exceed seventy-five 
(75) percent of the amount determined by the Agency to be the 
reasonable and necessary cost of such project.
    (i) Seventy-five (75) percent Federal funding will be the general 
presumption for projects to activate stations or to extend service.
    (ii) Fifty (50) percent Federal funding will be the general 
presumption for the replacement, improvement or augmentation of 
equipment. A showing of extraordinary need (i.e. small community-
licensee stations or a station that is licensed to a large institution 
[e.g., a college or university] documenting that it does not receive 
direct or in-kind support from the larger institution), or an emergency 
situation will be taken into consideration as justification for grants 
of up to 75% of the total project cost for such proposals.

[[Page 27238]]

    (2) Since the purpose of the PTFP is to provide financial 
assistance for the acquisition of public telecommunications facilities, 
Total Project Costs do not normally include the value of eligible 
apparatus owned or acquired by the applicant prior to the closing date. 
Inclusion of equipment purchased prior to the closing date will be 
considered on a case-by-case basis only when clear and compelling 
justifications are provided to PTFP. Obligating funds--either in whole 
or in part--for equipment before the closing date is considered 
ownership or acquisition of equipment. In like manner, accepting title 
to donated equipment prior to the closing date is considered ownership 
or acquisition of equipment.
    (c) No part of the grantee's matching share of the eligible project 
costs may be met with funds:
    (1) Paid by the Federal government, except where the use of such 
funds to meet a Federal matching requirement is specifically and 
expressly authorized by the relevant Federal statute, or
    (2) Supplied to an applicant by the Corporation for Public 
Broadcasting, except upon a clear and compelling showing of need.
    (d) No funds from the Federal share of the total project cost may 
be obligated until the award period start date. If an applicant or 
recipient obligates anticipated Federal Award funds before the start 
date, the Department may refuse to offer the award or, if the award has 
already been granted, disallow those costs of the grant. After the 
closing date, the applicant may, at its own risk, obligate non-Federal 
matching funds for the acquisition of proposed equipment.


Sec. 2301.7  Eligible and ineligible project costs.

    (a) Each year the Agency reviews its list of eligible and 
ineligible equipment, supplies, and costs. The list is published in the 
Federal Register as part of the solicitation for applications and a 
copy is provided with every application package for PTFP grants.
    (b) All broadcast equipment that a grantee acquires under this 
program shall be of professional broadcast quality. An applicant 
proposing to utilize nonbroadcast technology shall propose and purchase 
equipment that is compatible with broadcast equipment wherever the two 
types of apparatus interface.
    (c) Total project costs do not include the value of eligible 
apparatus owned or acquired by the applicant prior to the closing date 
unless approved by PTFP on a case-by-case basis in writing pursuant to 
Sec. 2301.6(b)(2).


Sec. 2301.8  Submission of applications.

    (a) Applications can be obtained from the following address: Public 
Telecommunications Facilities Program, NTIA/DOC, 14th Street and 
Constitution Avenue NW., Room H-4625, Washington, DC 20230.
    (b) The Administrator shall select and publish in the Federal 
Register a closing date by which applications for funding in a current 
fiscal year are to be filed.
    (c) All applications, whether mailed or hand delivered, must be 
received by the Agency at the address listed in the annual Federal 
Register announcement requesting applications at or before 5:00 p.m. on 
the closing date. Applications received after the closing date shall be 
rejected and returned without further consideration.
    (d) A complete application must include all of the information 
required by the Agency application materials and must be submitted in 
the number of copies specified by the Agency.
    (e) Each copy of the Agency application must contain an original 
signature of an officer of the applicant who is legally authorized to 
sign for the applicant.
    (f) Applicants must certify whether they are delinquent on any 
Federal debt.
    (g) Applicants may be required to submit Name Check forms (Form CD-
346) which may be used to ascertain background information on key 
individuals associated with potential grantees as part of the 
application, per Department Pre-Award Administrative Requirements and 
Policies.
    (h) Applicant organizations may also be subject to a responsibility 
determination by the Department which may include, but not be limited 
to reviews of financial and other business activities. Responsibility 
determinations are intended to ascertain whether potential grantee 
organizations or their key personnel have been involved in or are 
facing any matters that might significantly and negatively impact on 
their business honesty, financial integrity and/or ability to 
successfully perform the proposed grant activities.
    (i) Unsatisfactory performance by the applicant under prior Federal 
awards may result in the application not being funded.


Sec. 2301.9  Deferred applications.

    (a) An applicant may reactivate an application deferred by the 
Agency during the prior year if the applicant has not substantially 
changed the stated purpose of the application.
    (b) An applicant may reactivate a deferred application only during 
the two consecutive years following the application's initial filing 
with the Agency.
    (c) To reactivate a deferred application, the applicant must file 
an updated application, whether mailed or hand delivered, at or before 
5:00 p.m. on the closing date.
    (d) An updated application must include all of the information 
required by the Agency application materials and must be submitted in 
the number of copies specified by the Agency.
    (e) Deferred applications that are resubmitted under this section 
and contain substantial changes will be considered as new applications.
    (f) All deferred applications may be subject to a determination of 
eligibility during subsequent grant cycles.


Sec. 2301.10  Applications resulting from catastrophic damage or 
emergency situations.

    (a) An application may be filed with a request for a waiver of the 
closing date, as provided in Sec. 2301.26, when an eligible broadcast 
applicant suffers catastrophic damage to the basic equipment essential 
to its continued operation as a result of a natural or manmade 
disaster, or as the result of complete equipment failure, and is in 
dire need of assistance in funding replacement of the damaged 
equipment.
    (b) The request for a waiver must set forth the circumstances that 
prompt the request and be accompanied by appropriate supporting 
documentation.
    (c) A waiver will be granted only if it is determined that the 
applicant either carried adequate insurance or had acceptable self-
insurance coverage.
    (d) Applications filed and accepted pursuant to this section must 
contain all of the information required by the Agency application 
materials and must be submitted in the number of copies specified by 
the Agency.
    (e) The application will be subject to the same evaluation and 
selection process followed for applications received in the normal 
application cycle, although the Administrator may establish a special 
timetable for evaluation and selection to permit an appropriately 
timely decision.


Sec. 2301.11  Service of applications.

    On or before the closing date all new or deferred applicants must 
serve a summary copy of the application on the following agencies:
    (a) In the case of an application for a construction grant for 
which FCC authorization is necessary, the Secretary, Federal 
Communications Commission, 1919 M Street, N.W., Washington, DC 20554;
    (b) The state telecommunications agency(-ies), if any, having 
jurisdiction

[[Page 27239]]

over the development of broadcast and/or nonbroadcast 
telecommunications in the state(s) and the community(-ies) to be served 
by the proposed project; and
    (c) The state office established to review applications under 
Executive Order 12372, as amended by Executive Order 12416, in all 
states where equipment requested in the application will be located and 
where the state has established such an office and wishes to review 
these applications.


Sec. 2301.12  Federal Communications Commission authorizations.

    (a) Each applicant whose project requires FCC authorization must 
file an application for that authorization on or before the closing 
date. NTIA recommends that its applicants submit PTFP-related FCC 
applications to the FCC at least 60 days prior to the PTFP closing 
date. The applicant should clearly identify itself to the FCC as a PTFP 
applicant.
    (b) In the case of FCC authorizations where it is not possible or 
practical to submit the FCC license application with the PTFP 
application, such as C-band satellite uplinks, low power television 
stations and translators, remote pickups, studio-to-transmitter links, 
and Very Small Aperture Terminals, a copy of the FCC application as it 
will be submitted to the FCC, or the equivalent engineering data, must 
be included in the PTFP application.
    (c) Applications requesting C-band downlinks are not required to 
submit the FCC application or equivalent engineering data as part of 
the PTFP application. When such a project is funded, however, grantees 
will be required to submit evidence of FCC registration of the C-band 
downlink prior to the release of Federal funds.
    (d) Any FCC authorization required for the project must be in the 
name of the applicant for the PTFP grant.
    (e) If the project is to be associated with an existing station, 
the FCC operating authority for that station must be current and valid.
    (f) For any project requiring new authorization(s) from the FCC, 
the applicant must file a copy of each FCC application and any 
amendments with the Agency.
    (g) If the applicant fails to file the required FCC application(s) 
by the closing date, or if the FCC returns, dismisses, or denies an 
application required for the project or any part thereof, or for the 
operation of the station with which the project is associated, the 
Agency may reject and return the application.
    (h) No grant will be awarded until confirmation has been received 
from the FCC that any necessary authorization will be issued.


Sec. 2301.13  Public comments.

    (a) After the closing date, the Agency will publish a list of all 
applications received.
    (b) The applicant shall make a copy of its application available at 
its offices for public inspection during normal business hours.
    (c) A copy of the application will be available in the PTFP offices 
for public inspection during normal business hours.
    (d) Any interested party may file comments with the Agency 
supporting or opposing an application and setting forth the grounds for 
support or opposition. Any opposing comments must contain a 
certification that a copy of the comments has been delivered to the 
applicant. Comments must be sent to the address listed in 
Sec. 2301.8(a).
    (e) The Agency shall incorporate all comments from the public and 
any replies from the applicant in the applicant's official file for 
consideration during the evaluation of the application.


Sec. 2301.14  Supplemental application information.

    (a) The Agency may request from the applicant any additional 
information that the Agency deems necessary to clarify the application. 
Applicants must provide to the Agency additional information that the 
Agency requests within fifteen (15) days of the date of the Agency's 
notice. Applicants must submit a copy of the requested information for 
each copy of the application submitted by the Closing Date.
    (b) Applicants must immediately provide to the Agency information 
received after the closing date that materially affects the 
application, including:
    (1) State Single Point of Contact and State Telecommunications 
Agency comments on applications;
    (2) FCC file numbers and changes in the status of FCC applications 
necessary for the proposed project;
    (3) Changes in the status of proposed local matching funds, 
including notification of the passage (including reduction or 
rejection) of a proposed state appropriation or receipt (or denial) of 
a proposed substantial matching gift;
    (4) Changes that affect the applicant's eligibility under 
Sec. 2301.3;
    (5) Changes in the status of proposed production, participation, or 
distribution agreements (if relevant to the proposed project);
    (6) Changes in lease or site rights agreements; and
    (7) Complete failure of major items of equipment for which 
replacement costs have been requested or changes in the status of the 
need for the equipment requested.
    (c) Applicants must place copies of any additional information 
submitted to the Agency in the copy of the application made available 
for public inspection pursuant to Sec. 2301.13.
    (d) Applicants may not contact the Department to discuss the merits 
of an application when it is under review.


Sec. 2301.15  Withdrawal of applications.

    (a) Applicants may request withdrawal of an application from 
consideration for funding without affecting future consideration. 
Withdrawn applications will be returned by the Agency.
    (b) A request that the Agency defer an application for 
consideration in a subsequent year will be treated as a request for 
withdrawal.

Subpart C: Evaluation and Selection Process


Sec. 2301.16  Technical evaluation.

    (a) In determining whether to approve or defer a construction or 
planning grant application, in whole or in part, and the amount of such 
grant, the Agency will evaluate all the information in the application 
file.
    (b) PTFP grants are awarded on the basis of a competitive review 
process. The evaluation of the applications is based upon the 
evaluation criteria provided under Sec. 2301.17.
    (c) The competitive review process may include the following: 
evaluation by PTFP staff; technical assessment by engineers; an 
evaluation by outside reviewers, all of whom have demonstrated 
expertise in either public broadcasting or distance learning; and 
rating by a national advisory panel, composed of representatives of 
major national public radio and television organizations.
    (d) In acting on applications and carrying out other 
responsibilities under the Act, the Agency shall consult (as 
appropriate) with the FCC, the Corporation for Public Broadcasting, 
state telecommunications agencies, public broadcasting agencies, 
organizations, and other agencies administering programs that may be 
coordinated effectively with Federal assistance provided under the Act; 
and, the state office established to review applications under 
Executive Order 12372, as amended by Executive Order 12416,
    (e) Based upon the evaluation criteria contained in Sec. 2301.17, 
the PTFP

[[Page 27240]]

program staff will prepare summary evaluations. These will incorporate 
the outside reviewers' recommendations, engineering assessments, and 
program staff evaluations.


Sec. 2301.17  Evaluation criteria for construction and planning 
applications.

    (a) For each application that is filed in a timely manner by an 
eligible applicant, is materially complete, and proposes an eligible 
project, the Agency will consider the following factors:
    (1) Project Objectives: The degree to which the application 
documents that the proposed project fulfills the objectives and 
specific requirements of one or more of the categories set forth in 
Sec. 2301.4.
    (2) Applicant Qualifications: Documentation that the applicant has 
or will have sufficient qualified staff to complete the project, 
operate and maintain the facility, and provide services of professional 
quality.
    (3) Urgency: Documentation that justifies funding the proposed 
project during the current grant cycle.
    (4) Financial Qualifications: Documentation reflecting the 
applicant's ability to provide non-Federal funds required for the 
project, including funds for the local match and funds to cover any 
ineligible costs required for completion of the project; to ensure 
long-term financial support for the continued operation of the facility 
during the Federal interest period; to adequately justify the need for 
Federal funds in excess of fifty (50) percent of total project costs 
(see Sec. 2301.6(b)(ii)), if requested for equipment replacement, 
improvement, or augmentation projects; and, in the case of planning, 
provide non-Federal support and resources (if proposed by the 
applicant), including matching or in-kind support for the project.
    (5)(i) Technical Qualifications (construction applicants only): 
Documentation that the eligible equipment requested is necessary to 
achieve the objectives of the project; that the proposed costs reflect 
the most efficient use of Federal funds in achieving project 
objectives; that the equipment requested meets current industry 
performance standards (and FCC standards, if appropriate); that the 
condition of existing equipment justifies its prompt replacement; and 
that an evaluation of alternative technologies has been completed that 
justifies the selection of the requested technology (where alternative 
technologies are possible).
    (ii) Planning Qualifications (planning applicants only): 
Documentation : of the feasibility of the proposed planning process and 
timetable for achieving the expected results; that costs proposed 
reflect the most efficient use of Federal funds; that the applicant has 
sufficient qualified staff or consultants to complete the planning 
project with professional results; and that an evaluation of 
alternative technologies will be incorporated into the plan, if 
appropriate.
    (6) Special Consideration: Documentation of the extent to which 
broadcast applications would increase minority and women's ownership 
of, operation of, and participation in public telecommunications 
entities, as stated in Sec. 2301.5
    (b) The Agency will provide each applicant with guidance in the 
application materials on the type of documentation necessary to meet 
each of the above evaluation criteria.


Sec. 2301.18  Selection process.

    (a) The PTFP Director will consider the summary evaluations 
prepared by program staff, rank the applications, and present 
recommendations to the Selecting Official, the NTIA Administrator, 
taking into account the following selection factors:
    (1) The program staff evaluations, including the outside reviewers.
    (2) The scope of projects set forth at Sec. 2301.4.
    (3) Whether the application is for broadcast or a nonbroadcast 
project.
    (4) The geographic distribution of the proposed grant awards.
    (5) The availability of funds.
    (b) The Administrator makes final award selections taking into 
consideration the Director's recommendations and the degree to which 
the slate of applications, taken as a whole, satisfies the program's 
stated purposes set forth at Sec. 2301.1.
    (c) No grant will be awarded until confirmation has been received 
from the FCC that any necessary authorization will be issued.
    (d) After final award selections have been made, the Agency will 
notify the applicant of one of the following actions:
    (1) Selection of the application for funding, in whole or in part;
    (2) Deferral of the application for subsequent consideration;
    (3) Rejection of the application with an explanation and the 
reason, if an applicant is not eligible or if the proposed project does 
not fall within at least one of the categories enumerated at 
Sec. 2301.4; or,
    (4) Return of applications that were deferred by the Agency after 
consideration during three grant cycles.
    (e) The Agency will notify the following organizations of those 
applications selected for funding:
    (1) The state educational telecommunications agency(-ies), if any, 
in any state any part of which lies within the service area of the 
applicant's facility;
    (2) The FCC; and,
    (3) The Corporation for Public Broadcasting and, as appropriate, 
other public telecommunications entities.

Subpart D--Post-Award Requirements


Sec. 2301.19  General conditions attached to the Federal award.

    (a) During the project award period and the remainder of the 
Federal interest period, the grantee must:
    (1) Continue to be an eligible organization as described in 
Sec. 2301.3;
    (2) Obtain and continue to hold any necessary FCC authorization(s);
    (3) Use the Federal funds for which the grant was made for the 
equipment and other expenditure items specified in the application for 
inclusion in the project, except that the grantee may substitute other 
items where necessary or desirable to carry out the purpose of the 
project if approved in advance by the agency in writing. These changes 
include but are not limited to the following:
    (i) Costs (including planning costs),
    (ii) Essential specifications of the equipment,
    (iii) The engineering configuration of the project,
    (iv) Extensions of the approved grant award period, and
    (v) Transfers of a grant award to a successor in interest, pursuant 
to Sec. 2301.19(c).
    (4) Use the facilities and any monies generated through the use of 
the facilities primarily for the provision of public telecommunications 
services and ensure that the use of the facilities for other than 
public telecommunications purposes does not interfere with the 
provision of the public telecommunications services for which the grant 
was made;
    (5) Not make its facilities available to any person for the 
broadcast or other transmission intended to be received directly by the 
public, of any advertisement, unless such broadcast or transmission is 
expressly and specifically permitted by law or authorized by the FCC; 
and
    (6) State when advertising for bids for the purchase of equipment 
that the Federal government has an interest in facilities purchased 
with Federal funds under this program that begins with the purchase of 
the facilities and continues

[[Page 27241]]

for ten (10) years after the completion of the project.
    (b) During the period in which the grantee possesses or uses the 
Federally funded facilities, the grantee may not use or allow the use 
of the Federally funded equipment for purposes the essential thrust of 
which are sectarian for the useful life of the equipment even when this 
extends beyond the ten (10) year Federal interest period.
    (c) If necessary to further the purpose of the Act, the Agency may 
reassign a grant to a successor in interest or subsidiary corporation 
of a grantee in cases where a similar operational entity remains in 
control of the grant and the original objectives of the grant remain in 
effect. Each party must provide, in writing, its assent to the 
substitution. Any substituted party must meet the eligibility 
requirements.


Sec. 2301.20  Schedules and Reports.

    (a) Within thirty (30) calendar days of the award date the grantee 
shall submit to the Agency, in duplicate, a construction schedule or a 
revised planning timetable that will include the information requested 
in the grant terms and conditions in the award package.
    (b) During the project period of this grant, the grantee shall 
submit performance reports, in duplicate, on a calendar year quarterly 
basis for the period ending March 31, June 30, September 30, and 
December 31, or any portions thereof. The Quarterly Performance Reports 
should contain the following information:
    (1) A comparison of actual accomplishments during the reporting 
period with the goals and dates established in the Construction or 
Planning Schedule for that reporting period;
    (2) A description of any problems that have arisen or reasons why 
established goals have not been met;
    (3) Actions taken to remedy any failures to meet goals; and
    (4) Construction projects must also include a list of equipment 
purchased during the reporting period compared with the equipment 
authorized. This information must include manufacturer, make and model 
number, brief description, number and date of the items purchased, and 
cost.


Sec. 2301.21  Payment of Federal funds.

    (a) The Department will not make any payment under an award, unless 
and until the recipient complies with all relevant requirements imposed 
by this Part. Additionally:
    (1) The Department will not make any payment until it receives 
confirmation that the FCC has granted any necessary authorization;
    (2) The Department may not make any payment under an award unless 
and until all special award conditions stated in the award documents 
that condition the release of Federal funds are met; and
    (3) An agreement to share ownership of the grant equipment (e.g., a 
joint venture for a tower) must be approved by the Agency before any 
funds for the project will be released.
    (b) As a general matter, the Agency expects grantees to expend 
local matching funds at a rate at least equal to the ratio of the local 
match to the Federal grant as stipulated in the grant award.


Sec. 2301.22  Protection, acquisition and substitution of equipment.

    (a) To assure that the Federal investment in public 
telecommunications facilities funded under the Act will continue to be 
used to provide public telecommunications services to the public during 
the Federal interest period, the Agency may require a grantee to:
    (1) Execute and record a document establishing that the Federal 
government has a priority lien on any facilities purchased with funds 
under the Act during the period of continuing Federal interest. The 
document shall be recorded where liens are normally recorded in the 
community where the facility is located and in the community where the 
grantee's headquarters are located; and
    (2) File a certified copy of the recorded lien with the 
Administrator ninety (90) days after the grant award is received.
    (b) The grantee shall maintain protection against common hazards 
through adequate insurance coverage or other equivalent undertakings, 
except that, to the extent the applicant follows a different policy of 
protection with respect to its other property, the applicant may extend 
such policy to apparatus acquired and installed under the project. The 
grantee shall purchase flood insurance (in communities where such 
insurance is available) if the facilities will be constructed in any 
area that has been identified by the Secretary of Health and Human 
Services as having special flood hazards.
    (c) The grantee shall not dispose of or encumber its title or other 
interests in the equipment acquired under this grant during the Federal 
interest period.
    (d) The grantee shall demonstrate that the grantee has obtained 
appropriate title or lease satisfactory to protect the Federal interest 
to the site or sites on which apparatus proposed in the project will be 
operated. The grantee must have the right to occupy, construct, 
maintain, operate, inspect, and remove the project equipment without 
impediment to assure the sufficient continuity of operation of the 
facility; and nothing must prevent the Federal government from entering 
the property and reclaiming or securing PTFP-funded property.
    (e) The Agency will allow the acquisition of facilities by lease; 
however, the following requirements apply:
    (1) The lease must be of benefit to the Federal government;
    (2) The actual amount of the lease must not be more than the 
outright purchase price would be; and
    (3) The lease agreement must state that in the event of anticipated 
or actual termination of the lease, the Federal government has the 
right to transfer and assign the leasehold to a new grantee for the 
duration of the lease contract.
    (f) Transfer of equipment. Where the grant equipment is no longer 
needed for the original purposes of the project, the Agency may 
transfer the equipment to the Federal government or an eligible third 
party, in accordance with Office of Management and Budget guidelines.
    (g) Transfer of Federal interest to different equipment. The Agency 
may transfer the Federal interest in PTFP-funded equipment to other 
eligible equipment presently owned or to be purchased by the grantee 
with non-Federal monies, provided the following conditions are met:
    (1) If the Federal interest is to be transferred to other equipment 
presently owned or to be purchased by a grantee, the Federal interest 
in the new equipment must be at least equal to the Federal interest in 
the original equipment.
    (2) Equipment previously funded by PTFP that is within the Federal 
interest period may not be used in a transfer request as the designated 
equipment to which the Federal interest is to be transferred.
    (3) The same item can be used only once to substitute for the 
Federal interest. However, the Federal interest in several items of 
equipment from different grants may be transferred to a single item if 
the request for all such transfers is submitted at the same time.
    (4) A lien on equipment transferred to the Federal interest may be 
required by PTFP and must be recorded in accordance with 
Sec. 2301.23(b)(8). A copy of the lien document must be filed with the 
PTFP within sixty (60) days of the date of approval of the transfer of 
Federal interest.

[[Page 27242]]

    (h) Termination by buy-out. A grantee may terminate the Federal 
revisionary interest in a PTFP grant by buying out the Federal interest 
with non-Federal monies. Buy-outs may be requested at any time.

Subpart E--Completion of Projects


Sec. 2301.23  Completion of projects.

    (a) Upon completion of a planning project, the grantee must 
promptly provide to the Administrator two copies of any report or study 
conducted in whole or in part with funds provided under this program by 
sending the copies to the Agency.
    (1) This report shall meet the goals and objectives for which the 
grant is awarded and shall follow the written instructions and guidance 
provided by the Agency. The grant award goals and objectives are stated 
in the planning narrative as amended and are incorporated by reference 
into the award agreement.
    (2) The Agency shall review this report for the extent to which 
those goals and objectives are addressed and met, for evidence that the 
work contracted for under the grant award was in fact performed, and to 
determine whether the written instructions and guidance provided by the 
Agency, if any, were followed.
    (3) If the Agency determines that the report fails to address or 
meet any grant award goals or objectives, or if there is no evidence 
that the work contracted for was in fact performed, or if this report 
clearly indicates that the written instructions and guidance provided 
by the Agency, if any, were disregarded, then the Agency may pursue 
remedial action.
    (4) An unacceptable final report may result in the disallowance of 
claimed costs and the establishment of an account receivable by the 
Department.
    (b) Upon completion of a construction project, the grantee must:
    (1) Certify that the grantee has acquired, installed, and begun 
operating the project equipment in accordance with the project as 
approved by the Agency, and has complied with all terms and conditions 
of the grant as specified in the Grant Award document;
    (2) Certify that the grantee has obtained any necessary FCC 
authorizations to operate the project apparatus following the 
acquisition and installation of the apparatus and document the same;
    (3) Certify and document that the facilities have been acquired, 
that they are in operating order, and that the grantee is using the 
facilities to provide public telecommunications services in accordance 
with the project as approved by the Agency;
    (4) Certify that the grantee has obtained adequate insurance to 
protect the Federal interest in the project in the event of loss 
through casualty;
    (5) Certify, if not previously provided, that the grantee has 
acquired all necessary leases or other site rights required for the 
project;
    (6) Certify, if appropriate, that the grantee has qualified for 
receipt of funds from the Corporation for Public Broadcasting;
    (7) Provide a complete and accurate final inventory of equipment 
acquired under the project and a final accounting of all project 
expenditures, including non-equipment costs (e.g., installation costs); 
and
    (8) Execute and record a final priority lien, if required by PTFP, 
reflecting the completed project and assuring the Federal government's 
reversionary interest in all equipment purchased under the grant 
project for the duration of the Federal interest period.
    (c) When an applicant completes a construction project, the Agency 
will assign a completion date that the Agency will use to calculate the 
termination date of the Federal interest period. The completion date 
will usually be the date on which the project period expires unless the 
grantee certifies in writing prior to the project period expiration 
date that the project is complete and in accord with the terms and 
conditions of the grant, as required under Sec. 2301.23(b)(1). If the 
PTFP Director determines that the grantee improperly certified the 
project to be complete, the PTFP Director will amend the completion 
date accordingly.


Sec. 2301.24  Final Federal payment.

    If the total allowable, allocable, and reasonable costs incurred in 
completing the planning or construction project are less than the total 
project award amount, the Agency shall reduce the amount of the final 
Federal share on a pro rata basis. If, however, the actual costs 
incurred in completing the project are more than the estimated total 
project costs, then in no case will the final Federal funds paid exceed 
the initial grant award.


Sec. 2301.25  Retention of records and annual status reports.

    (a) All grantees shall keep intact and accessible all records 
specified in Office of Management and Budget Circular A-110 (for 
educational institutions, hospitals, and nonprofit organizations), or 
15 CFR part 24 (for State and Local Governments), and 15 CFR part 29a 
(Audit Requirements for State and Local Governments) or 15 CFR part 29b 
(Audit Requirements for Institutions of Higher Education and Other 
Nonprofit Organizations), as appropriate.
    (b) Recipients of construction grants:
    (1) Are required to submit an Annual Status Report for each grant 
project that is in the Federal interest period. The Reports are due no 
later than April 1 in each year of the period. Information about what 
is to be included in the Annual Status Report is supplied to grant 
recipients at the time grants are closed out.
    (2) Shall retain an inventory of the equipment for the duration of 
the ten year Federal interest period and shall mark project apparatus 
in a permanent manner to assure easy and accurate identification and 
reference to inventory records. The marking shall include the PTFP 
grant number and an inventory number assigned by the grantee.
    (3) May also be required to take whatever steps may be necessary to 
ensure that the Federal government's reversionary interest continues to 
be protected for the 10-year period by recording, when and where 
required, a lien continuation statement and reporting that fact in the 
Annual Status Report.

Subpart F: Waivers


Sec. 2301.26  Waivers.

    For good cause shown, the Administrator may waive the regulations 
adopted pursuant to section 392(e) of the Act. Waivers may only be 
granted for regulatory requirements that are discretionary and not 
statutorily mandated.

[FR Doc. 96-13572 Filed 5-29-96; 8:45 am]
BILLING CODE 3510-60-P