[Federal Register Volume 72, Number 159 (Friday, August 17, 2007)]
[Notices]
[Pages 46195-46207]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-16216]


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DEPARTMENT OF AGRICULTURE

Rural Utilities Service


Assistance to High Energy Cost Rural Communities

AGENCY: Rural Utilities Service, USDA.

ACTION: Notice of funding availability (NOFA).

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SUMMARY: The Rural Utilities Service, an agency delivering the United 
States Department of Agriculture's (USDA) Rural Development Utilities 
Programs, hereinafter referred to as the Agency, announces the 
availability of $21.9 million in Fiscal Year 2007 for competitive 
grants to assist communities with extremely high energy costs. This 
grant program is authorized under section 19 of the Rural 
Electrification Act of 1936 (RE Act) (7 U.S.C. 918a) and program 
regulations at 7 CFR part 1709. The grant funds may be used to acquire, 
construct, extend, upgrade, or otherwise improve energy generation, 
transmission, or distribution facilities serving communities in which 
the average residential expenditure for home energy exceeds 275 percent 
of the national average. Eligible applicants include persons, States, 
political subdivisions of States, and other entities organized under 
State law. Federally-recognized Indian tribes and tribal entities are 
eligible applicants. This notice describes the eligibility and 
application requirements, the criteria that will be used by the Agency 
to award funding, and information on how to obtain application 
materials. All grants awarded under this NOFA are contingent on the 
availability of appropriated funds. The Catalog of Federal Domestic 
Assistance (CFDA) Number for this program is 10.859. You may obtain the 
application guide and materials for the Assistance to High Energy Cost 
Rural Communities Grant Program via the Internet at the following Web 
site: http://www.usda.gov/rus/electric/. You may also request the 
application guide and materials from USDA Rural Development by 
contacting the individual listed in the FOR FURTHER INFORMATION CONTACT 
section of this notice.

DATES: You may submit completed grant applications on paper or 
electronically according to the following deadlines:
     Paper applications must be postmarked and mailed, shipped, 
or sent overnight, no later than October 1, 2007, or hand delivered to 
the Agency by this deadline, to be eligible under this NOFA. Late or 
incomplete applications will not be eligible for FY 2007 grant funding.
     Electronic applications must be submitted through 
Grants.gov no later than October 1, 2007 to be eligible under this NOFA 
for FY 2007 grant funding. Late or incomplete electronic applications 
will not be eligible.
    Applications will be accepted on publication of this notice.

ADDRESSES: You may submit completed applications for grants on paper or 
electronically to the following addresses:
     Paper applications are to be submitted to the United 
States Department of Agriculture, Rural Development Electric Programs, 
1400 Independence Avenue, SW., STOP 1560, Room 5165 South Building, 
Washington, DC 20250-1560. Applications should be marked ``Attention: 
High Energy Cost Community Grant Program.''
     Applications may be submitted electronically through 
Grants.gov. Information on how to submit applications electronically is 
available on the Grants.gov Web site (http://www.Grants.gov). 
Applicants must successfully pre-register with Grants.gov to use the 
electronic applications option. Application information may be 
downloaded from Grants.gov without pre-registration.

FOR FURTHER INFORMATION CONTACT: Karen Larsen, Management Analyst, 
United States Department of Agriculture, Rural Development Electric 
Programs, 1400 Independence Avenue, SW., STOP 1560, Room 5165 South 
Building, Washington, DC 20250-1560. Telephone 202-720-9545, Fax 202-
690-0717, e-mail [email protected].

SUPPLEMENTARY INFORMATION:

Overview Information

    Federal Agency Name: United States Department of Agriculture, Rural 
Development Utilities Programs, Assistant Administrator, Electric 
Programs.
    Funding Opportunity Title: Assistance to High Energy Cost Rural 
Communities.
    Announcement Type: Initial announcement.
    Funding Opportunity Number: USDA-RD-RUS-HECG07.
    Catalog of Federal Domestic Assistance (CFDA) Number: 10.859. The 
CFDA title for this program is ``Assistance to High Energy Cost Rural 
Communities.''
    Dates: Applications must be postmarked and mailed or shipped, or 
hand delivered to the Agency, or filed with Grants.gov by October 1, 
2007.

I. Funding Opportunity Description

    The Agency is making available $21.9 million in competitive grants 
under section 19 of the Rural Electrification Act of 1936 (the ``RE 
Act'') (7 U.S.C. 918a). Under section 19, the Agency Administrator is 
authorized to make grants to ``acquire, construct, extend, upgrade, and 
otherwise improve energy generation, transmission, or distribution 
facilities'' serving extremely high energy cost communities. Eligible 
communities are those in which the average residential expenditure for 
home energy is at least 275 percent of the national

[[Page 46196]]

average residential expenditure for home energy under the benchmarks 
published in this notice. Program regulations are codified at 7 CFR 
Part 1709.
    The purpose of this grant program is to provide financial 
assistance for a broad range of energy facilities, equipment and 
related activities to offset the impacts of extremely high residential 
energy costs on eligible communities. Grant funds may be used to 
purchase, construct, extend, repair, upgrade and otherwise improve 
energy generation, transmission, or distribution facilities serving 
eligible communities. Eligible facilities include on-grid and off-grid 
renewable energy systems and implementation of cost-effective demand 
side management and energy conservation programs that benefit eligible 
communities. Grant funds may not be used to pay utility bills or to 
purchase fuel. Grant projects under this program must provide community 
benefits and not be for the sole benefit of an individual applicant, 
household, or business.
    Eligible applicants include for-profit and non-profit businesses, 
cooperatives, and associations, States, political subdivisions of 
States, and other entities organized under the laws of States, Indian 
tribes, tribal entities, and individuals. Eligible applicants also 
include entities located in U.S. Territories and other areas authorized 
by law to participate in the Agency's programs or programs under the RE 
Act.
    No cost sharing or matching funds are required as a condition of 
eligibility under this grant program. However, the Agency will consider 
other financial resources available to the applicant and any voluntary 
commitment of matching funds or other contributions in assessing the 
applicant's capacity to carry out the grant program successfully. The 
Agency will award additional evaluation points to any proposals that 
include such contributions.
    As a further condition of each grant, section 19(b)(2) of the RE 
Act requires that planning and administrative expenses of the grantee 
not directly related to the project may not exceed 4 percent of the 
grant funds.
    This NOFA provides an overview of the grant program, and the 
eligibility and application requirements, and selection criteria for 
grant proposals. The Agency is also making available an Application 
Guide with more detailed information on application requirements and 
copies of all required forms and certifications. The Application Guide 
is available on the Internet from the Agency Web site at http://www.usda.gov/rus/electric. The application guide may also be requested 
from the Agency contact listed in the FOR FURTHER INFORMATION CONTACT 
section of this notice. For additional information, applicants should 
consult the program regulations at 7 CFR part 1709.

Definitions

    Consult the program regulations at 7 CFR part 1709 and the 
Application Guide for additional definitions used in this program. As 
used in this NOFA:
    Application Guide means the Application Guide prepared by the 
Agency for the High Energy Cost Grant program containing detailed 
instructions for determining eligibility and preparing grant 
applications, and copies of required forms, questionnaires, and model 
certifications.
    Extremely high energy costs means community average residential 
energy costs that are at least 275 percent of one or more home energy 
cost benchmarks established by the Agency based on the national average 
residential energy expenditures as reported by the Energy Information 
Administration (EIA) of the United States Department of Energy.
    Home energy means any energy source or fuel used by a household for 
purposes other than transportation, including electricity, natural gas, 
fuel oil, kerosene, liquefied petroleum gas (propane), other petroleum 
products, wood and other biomass fuels, coal, wind, and solar energy. 
Fuels used for subsistence activities in remote rural areas are also 
included.
    High energy cost benchmarks means the criteria established by the 
Agency for eligibility as an extremely high energy cost community. Home 
energy cost benchmarks are calculated for total annual household energy 
expenditures; total annual expenditures for individual fuels; annual 
average per unit energy costs for primary home energy sources at 275 
percent of the relevant national average household energy benchmarks.
    Indian Tribe means a Federally recognized tribe as defined under 
section 4 of the Indian Self-Determination and Education Assistance Act 
(25 U.S.C. 450b) to include ``* * * any Indian tribe, band, nation, or 
other organized group or community, including any Alaska Native village 
or regional or village corporation as defined in or established 
pursuant to the Alaska Native Claims Settlement Act [43 U.S.C. 1601 et 
seq.], that is recognized as eligible for the special programs and 
services provided by the United States to Indians because of their 
status as Indians.''
    Person means any natural person, firm, corporation, association, or 
other legal entity, and includes Indian Tribes and tribal entities.
    Primary home energy source means the energy source that is used for 
space heating or cooling, water heating, cooking, and lighting. A 
household or community may have more than one primary home energy 
source.
    State rural development initiative means a rural economic 
development program funded by or carried out in cooperation with a 
State agency.
    Target area means the geographic area to be served by the grant.
    Target community means the unit or units of local government in 
which the target area is located.
    Tribal entity means a legal entity that is owned, controlled, 
sanctioned, or chartered by the recognized governing body of an Indian 
Tribe.

II. Award Information

    The total amount of funds available for grants in Fiscal Year 2007 
under this notice is $21.9 million. The maximum amount of grant 
assistance that will be considered for funding in a grant application 
under this notice is $5,000,000. The minimum amount of assistance for a 
grant application under this program is $75,000. The number of grants 
awarded under this NOFA will depend on the number of applications 
submitted, the amount of grant funds requested, the quality and 
competitiveness of applications submitted, and the availability of 
appropriated funds.
    The funding instrument available under this NOFA will be a grant 
agreement. Grants awarded under this notice must comply with all 
applicable USDA and Federal regulations concerning financial 
assistance, with the terms of this notice, and with the requirements of 
section 19 of the RE Act. Grants made under this NOFA will be 
administered under the Agency program regulations at 7 CFR part 1709 
and USDA financial assistance regulations at 7 CFR parts 3015, 3016, 
3017, 3018, 3019, and 3052, as applicable. The award period will 
generally be for 36 months, however, longer periods may be approved 
depending on the project involved.
    Project proposals submitted in response to the NOFA published on 
May 25, 2005 (70 FR 30067) and that were accepted as complete and 
timely by the Agency, but that were not selected for funding may 
request reconsideration of their proposals under this NOFA. Prior 
applicants may submit additional information for consideration as 
described later in this notice.

[[Page 46197]]

    All timely submitted and complete applications will be reviewed for 
eligibility and rated according to the criteria described in this NOFA. 
Applications will be ranked in order of their numerical scores on the 
rating criteria and forwarded to the Agency Administrator. The 
Administrator will review the rankings and the recommendations of the 
rating panel. The Administrator will then fund grant applications in 
rank order.
    The Agency reserves the right not to award any or all the funds 
made available under this notice, if in the sole opinion of the 
Administrator, the grant proposals submitted are not deemed feasible. 
The Agency also reserves the right to partially fund grants if grant 
applications exceed the available funds. The Agency will advise 
applicants if it cannot fully fund a grant request.

III. Eligibility Information

1. Eligible Applicants

    Under Section 19 eligible applicants include ``Persons, States, 
political subdivisions of States, and other entities organized under 
the laws of States'' (7 U.S.C. 918a). Under section 13 of the RE Act, 
the term ``Person'' means ``any natural person, firm, corporation, or 
association'' (7 U.S.C. 913). Examples of eligible business applicants 
include: For-profit and non-profit business entities, including but not 
limited to corporations, associations, partnerships, limited liability 
partnerships (LLPs), cooperatives, trusts, and sole proprietorships. 
Eligible government applicants include State and local governments, 
counties, cities, towns, boroughs, or other agencies or units of State 
or local governments; and other agencies and instrumentalities of 
States and local governments. Indian tribes, other tribal entities and 
Alaska Native Corporations are also eligible applicants.
    An individual is an eligible applicant under this program; however, 
the proposed grant project must provide community benefits and not be 
for the sole benefit of an individual applicant or an individual 
household or business.
    All applicants must demonstrate the legal capacity to enter into a 
binding grant agreement with the Federal Government at the time of the 
award and to carry out the proposed grant funded project according to 
its terms.
    Effective October 1, 2003, the Office of Management and Budget 
requires that all applicants for Federal grants with the exception of 
individuals other than sole proprietorships must have a Dun and 
Bradstreet (D&B) Data Universal Numbering System (DUNS) number. 
Consistent with this Federal policy directive, any organization or sole 
proprietorship that applies for a high energy cost grant must use its 
DUNS number on the application and in the field provided on the revised 
Standard Form 424 (SF 424), ``Application for Federal Assistance'' to 
be eligible to apply. DUNS numbers are available without charge to 
Federal Grant applicants. Information on this Federal requirement and 
how to obtain a DUNS number or how to verify if your organization 
already has a DUNS number is available at http://www.whitehouse.gov/omb/grants/duns_num_guide.pdf and on the ``Get Registered'' page at 
Grants.gov. D&B has also established a special Web-based registration 
for Federal Grant Applicants and Contractors that can be accessed 
directly by following the ``Customer Resources'' links for obtaining a 
DUNS number at http://www.dnb.com/us/. You may also verify whether you 
have an organizational DUNS number or request a DUNS number over the 
telephone toll free through the D&B Government Customer Response Center 
at 1-866-705-5711, Monday-Friday 7 a.m. to 8 p.m., C.S.T. If you 
already have obtained a DUNS number in connection with the Federal 
acquisition process or requested or had one assigned to you for another 
purpose, you should use that number on all of your applications. It is 
not necessary to request another DUNS number from D&B.

2. Cost Sharing and Matching

    No cost sharing or matching funds are required as a condition of 
eligibility under this grant program. However, the Agency will consider 
other financial resources available to the grant applicant and any 
voluntary pledge of matching funds or other contributions in assessing 
the applicant's commitment capacity to carry out the grant program 
successfully and will award additional evaluation points to proposals 
that include such contributions. If a successful applicant proposes to 
use matching funds or other cost contributions in its project to obtain 
additional evaluation points, the grant agreement will include 
conditions requiring documentation of the availability of the matching 
funds and actual expenditure of matching funds or cost contributions.

3. Other Eligibility Requirements

A. Eligible Projects
    Grantees must use grant funds for eligible grant purposes. Grant 
funds may be used to acquire, construct, extend, upgrade, or otherwise 
improve energy generation, transmission, or distribution facilities 
serving eligible communities. All energy generation, transmission, and 
distribution facilities and equipment, used to provide electricity, 
natural gas, home heating fuels, and other energy service to eligible 
communities are eligible. Projects providing or improving energy 
services to eligible communities through on-grid and off-grid renewable 
energy projects, energy efficiency, and energy conservation projects 
are eligible. A grant project is eligible if it improves, or maintains 
energy services, or reduces the costs of providing energy services to 
eligible communities. Grant funds may not be used to pay utility bills 
or to purchase fuels.
    Grants may cover up to the full costs of any eligible projects 
subject to the statutory condition that no more than 4 percent of grant 
funds may be used for the planning and administrative expenses of the 
grantee. The program regulations at 7 CFR part 1709 provide more detail 
on allowable uses of grant funds, limitations on grant funds, and 
ineligible grant purposes.
    The project must serve communities that meet the extremely high 
energy cost eligibility requirements described in this NOFA. The 
applicant must demonstrate that the proposed project will benefit the 
eligible communities. Projects that primarily benefit a single 
household or business are not eligible. Additional information and 
examples of eligible project activities are contained in the 
Application Guide.
    Grant funds cannot be used for: Preparation of the grant 
application, fuel purchases, routine maintenance or other operating 
costs, and purchase of equipment, structures, or real estate not 
directly associated with provision of residential energy services. In 
general, grant funds may not be used to support projects that primarily 
benefit areas outside of eligible target communities. However, grant 
funds may be used to finance an eligible target community's 
proportionate share of a larger energy project.
    Each grant applicant must demonstrate the economic and technical 
feasibility of its proposed project. Activities or equipment that would 
commonly be considered as research and development activities, or 
commercial demonstration projects for new energy technologies will not 
be considered as technologically feasible projects and would, thus, be 
ineligible grant purposes. However, grant funds may be used for 
projects that involve the innovative use or adaptation of energy-
related technologies that have been commercially proven.

[[Page 46198]]

B. Eligible Communities
    The grant project must benefit communities with extremely high 
energy costs. The RE Act defines an extremely high energy cost 
community as one in which ``the average residential expenditure for 
home energy is at least 275 percent of the national average residential 
expenditure for home energy'' 7 U.S.C. 918a. The determination is based 
on the latest available information from the Energy Information 
Administration (EIA) residential energy surveys.
    The statutory requirement that community residential expenditures 
for home energy exceed 275 percent of national average establishes a 
very high threshold for eligibility under this program. The Agency has 
calculated high energy cost benchmarks based on the most recent EIA 
national average home energy expenditure data. The benchmarks shown in 
Table 1 are changed from those used in prior rounds of High Energy Cost 
Grant applications. Communities must meet one or more high energy cost 
benchmarks to qualify as an eligible beneficiary of a grant under this 
program. All applicants, including those requesting reconsideration of 
prior applications must meet these revised eligibility benchmarks. 
Based on available published information on residential energy costs, 
the Agency anticipates that only those communities with the highest 
energy costs across the country will qualify under this 
congressionally-mandated standard.
    The EIA's Residential Energy Consumption and Expenditure Surveys 
(RECS) and reports provide the baseline national average household 
energy costs that were used by the Agency for establishing extremely 
high energy cost community eligibility criteria for this grant program. 
The RECS data base and reports provide national and regional 
information on residential energy use, expenditures, and housing 
characteristics. EIA published its latest available RECS home energy 
expenditure survey results in 2004. These estimates of home energy 
usage and expenditures are based on national surveys conducted in 2001 
survey data and are shown in Table 1 as follows:

   Table 1.--National Average Annual Household Energy Expenditures and Extremely High Energy Cost Eligibility
                                       Benchmarks Effective March 23, 2005
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                                                                         National annual
                                                                        average household      Extremely high
                                Fuel                                    expenditure $ per        energy cost
                                                                              year          benchmark $ per year
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                                      Average Annual Household Expenditure
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Electricity.........................................................                  $938                $2,509
Natural Gas.........................................................                   702                 1,859
Fuel Oil............................................................                   737                 1,882
LPG/Propane.........................................................                   605                 1,514
Total Household Energy Use..........................................                 1,493                 4,013
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                                                                                               Extremely high
                            Fuel (units)                                National average         energy cost
                                                                      unit cost $ per unit  benchmark $ per unit
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                                Annual Average per Unit Residential Energy Costs
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Electricity (kilowatt hours)........................................                $0.088                $0.239
Natural Gas (thousand cubic feet)...................................                  9.98                 26.85
Fuel Oil (gallons)..................................................                  1.24                  3.35
LPG/Propane (gallons)...............................................                  1.36                  3.61
Total Household Energy (million Btus)...............................                 16.19                 43.91
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Sources: United States Department of Energy, Energy Information Administration, Residential Energy Consumption
  and Expenditure Surveys 2001, available online at http://www.eia.doe.gov/emeu/recs/contents.html. The
  eligibility benchmarks are set at 275 percent of the national average and include adjustments to reflect the
  uncertainties inherent in EIA's statistical methodology for estimating home energy costs. The benchmarks are
  set based on the EIA's lower range estimates using the specified EIA methods.

    Extremely high energy costs in rural and remote communities 
typically result from a combination of factors including high energy 
consumption, high per unit energy costs, limited availability of energy 
sources, extreme climate conditions, and housing characteristics. The 
relative impacts of these conditions exhibit regional and seasonal 
diversity. Market factors have created an additional complication in 
recent years as the prices of the major commercial residential energy 
sources--electricity, fuel oil, natural gas, and LPG/propane--have 
fluctuated dramatically in some areas.
    The applicant must demonstrate that each community in the grant 
project's proposed target area exceeds one or more of these high energy 
cost benchmarks to be eligible for assistance under this program.

i. High Energy Cost Benchmarks

    The benchmarks measure extremely high energy costs for residential 
consumers. These benchmarks were calculated using EIA's estimates of 
national average residential energy expenditures per household and by 
primary home energy source. The benchmarks recognize the diverse 
factors that contribute to extremely high home energy costs in rural 
communities. The benchmarks allow extremely high energy cost 
communities several alternatives for demonstrating eligibility. 
Communities may qualify based on: Total annual household energy 
expenditures; total annual expenditures for commercially-supplied 
primary home energy sources, i.e., electricity, natural gas, oil, or 
propane; or average annual per unit home energy costs. By providing 
alternative measures for demonstrating eligibility, the benchmarks 
reduce the burden on potential applicants created by the limited public 
availability of comprehensive data on local community energy 
consumption and expenditures.
    A target community or target area will qualify as an extremely high 
cost energy

[[Page 46199]]

community if it meets one or more of the energy cost eligibility 
benchmarks described below.
    1. Extremely High Average Annual Household Expenditure for Home 
Energy. The target area or community exceeds one or more of the 
following:
     Average annual residential electricity expenditure of 
$2,509 per household;
     Average annual residential natural gas expenditure of 
$1,859 per household;
     Average annual residential expenditure on fuel oil of 
$1,882 per household;
     Average annual residential expenditure on propane or 
liquefied petroleum gas (LPG) as a primary home energy source of $1,514 
per household; or
     Average annual residential energy expenditure (for all 
non-transportation uses) of $4,013 per household.
    2. Extremely High Average per unit energy costs. The average 
residential per unit cost for major commercial energy sources in the 
target area or community exceeds one or more of the following:
     Annual average revenues per kilowatt hour for residential 
electricity customers of $0.239 per kilowatt hour (kWh);
     Annual average residential natural gas price of $26.85 per 
thousand cubic feet;
     Annual average residential fuel oil price of $3.35 per 
gallon;
     Annual average residential price of propane or LPG as a 
primary home energy source of $3.61 per gallon; or
     Total annual average residential energy cost on a Btu 
basis of $43.91 per million Btu.\1\
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    \1\ Note: Btu is the abbreviation for British Thermal Unit, a 
standard energy measure. A Btu is the quantity of heat needed to 
raise the temperature of one pound of water 1 degree Fahrenheit at 
or near 39.2 degrees Fahrenheit. In estimating average household per 
unit energy cost on a Btu basis, the costs of different home energy 
sources are converted to a standard Btu basis. The Application Guide 
contains additional information on calculating per unit costs on a 
Btu basis for major home energy sources.
---------------------------------------------------------------------------

ii. Supporting Energy Cost Data

    The applicant must include information that demonstrates its 
eligibility under the Agency's high energy cost benchmarks for the 
target communities and the target areas. The applicant must supply 
documentation or references for its sources for actual or estimated 
home energy expenditures or equivalent measures to support eligibility. 
Generally, the applicant will be expected to use historical residential 
energy cost or expenditure information for the local energy provider 
serving the target community or target area to determine eligibility. 
Other potential sources of home energy related information include 
Federal and State agencies, local community energy providers such as 
electric and natural gas utilities and fuel dealers, and commercial 
publications. The Application Guide includes a list of EIA resources on 
residential energy consumption and costs that may be of assistance.
    The grant applicant must establish eligibility for each community 
in the project's target area. To determine eligibility, the applicant 
must identify each community included in whole or in part within the 
target areas and provide supporting actual or estimated energy 
expenditure data for each community. The smallest area that may be 
designated as a target area is a 2000 Census block. This minimum size 
is necessary to enable a determination of population size.
    Potential applicants can compare the benchmark criteria to 
available information about local energy use and costs to determine 
their eligibility. Applicants should demonstrate their eligibility 
using historical energy use and cost information. Where such 
information is unavailable or does not adequately reflect the actual 
costs of supporting average home energy use in a local community, the 
Agency will consider estimated commercial energy costs. The Application 
Guide includes examples of circumstances where estimated energy costs 
are used.
    EIA does not collect or maintain data on home energy expenditures 
in sufficient detail to identify specific rural localities as extremely 
high energy cost communities. Therefore, grant applicants will have to 
provide information on local community energy costs from other sources 
to support their applications.
    In many instances, historical community energy cost information can 
be obtained from a variety of public sources or from local utilities 
and other energy providers. For example, EIA publishes monthly and 
annual reports of residential prices by State and by service area for 
electric utilities and larger natural gas distribution companies. 
Average residential fuel oil and propane prices are reported regionally 
and for major cities by government and private publications. Many State 
agencies also compile and publish information on residential energy 
costs to support State programs.

iii. Use of Estimated Home Energy Costs

    Where historical community energy cost data are incomplete or 
lacking or where community-wide data do not accurately reflect the 
costs of providing home energy services in the target area, the 
applicant may substitute estimates based on engineering standards. The 
estimates should use available community, local, or regional data on 
energy expenditures, consumption, housing characteristics and 
population. Estimates are also appropriate where the target area does 
not presently have centralized commercial energy services at a level 
that is comparable to other residential customers in the State or 
region. For example, local commercial energy cost information may not 
be available where the target area is without local electric service 
because of the high costs of connection. Engineering cost estimates 
reflecting the incremental costs of extending service could reasonably 
be used to establish eligibility for areas without grid-connected 
electric service. Estimates also may be appropriate where historical 
energy costs do not reflect the costs of providing a necessary upgrade 
or replacement of energy infrastructure to maintain or extend service 
that would raise costs above one or more of benchmarks.
    Information to support high energy cost eligibility is subject to 
independent review by the Agency. Applications that contain information 
that is not reasonably based on credible sources of information and 
sound estimates will be rejected. Where appropriate, the Agency may 
consult standard sources to confirm the reasonableness of information 
and estimates provided by applicants in determining eligibility, 
technical feasibility, and adequacy of proposed budget estimates.
C. Coordination With State Rural Development Initiatives
    USDA encourages the coordination of grant projects under this 
program with State rural development initiatives. There is no 
requirement that the grant proposal receive the concurrence or approval 
of State officials as a condition of eligibility under this program. 
The Agency will, however, award additional points to proposals that are 
coordinated with and support rural development initiatives within a 
State. The applicant should describe how the proposed project will 
support State rural development initiatives and provide documentation 
evidencing any project relationship to State initiatives.
    If an applicant is an entity directly involved in rural development 
efforts, such as a State, local, or tribal rural development agency, 
the applicant may qualify for additional points by

[[Page 46200]]

describing how its proposed project supports its efforts.
D. Limitations on Grant Awards
    1. Statutory limitation on planning and administrative expenses.
    Section 19 of the RE Act provides that no more than 4 percent of 
the grant funds for any project may be used for the planning and 
administrative expenses of the grantee that are not directly related to 
the grant project.
    2. Ineligible Grant Purposes.
    Grant funds cannot be used for: Preparation of the grant 
application, fuel purchases, routine maintenance or other operating 
costs, and purchase of equipment, structures, or real estate not 
directly associated with provision of residential energy services. In 
general, grant funds may not be used to support projects that primarily 
benefit areas outside of eligible target communities. However, grant 
funds may be used to finance an eligible target community's 
proportionate share of a larger energy project.
    Consistent with USDA policy and program regulations, grant funds 
awarded under this program generally cannot be used to replace other 
USDA assistance or to refinance or repay outstanding loans under the RE 
Act. Grant funds may, however, be used in combination with other USDA 
assistance programs including electric loans. Grants may be applied 
toward grantee contributions under other USDA programs depending on the 
terms of those programs. For example, an applicant may propose to use 
grant funds to offset the costs of electric system improvements in 
extremely high cost areas by increasing the utility's contribution for 
line extensions or system expansions to its distribution system 
financed in whole or part by an electric loan under the RE Act. An 
applicant may propose to finance a portion of an energy project for an 
extremely high energy cost community through this grant program and 
secure the remaining project costs through a loan or loan guarantee or 
grant from the Agency or other sources.
    3. Maximum and minimum awards.
    The maximum amount of grant assistance that will be considered for 
funding per grant application under this notice is $5,000,000. The 
minimum amount of assistance for a competitive grant application under 
this program is $75,000.

IV. Application and Submission Information

    All applications must be prepared and submitted in compliance with 
this NOFA and the Application Guide. The Application Guide contains 
additional information on the grant program, sources of information for 
use in preparing applications, examples of eligible projects, and 
copies of the required application forms.

1. Address To Request an Application Package

    Applications materials and the Application Guide are available for 
download through http://www.Grants.gov (under CFDA No. 10.859) and on 
the Electric Programs Web site at http://www.usda.gov/rus/electric.
    Application packages, including required forms, may be also be 
requested from: Karen Larsen, Management Analyst, United States 
Department of Agriculture, Rural Development, Electric Programs, 1400 
Independence Avenue, SW., STOP 1560, Room 5165 South Building, 
Washington, DC 20250-1560. Telephone 202-720-9545, Fax 202-690-0717, e-
mail [email protected].

2. Content and Form of Application Submission

    There are different application requirements for first time 
applicants and for prior applicants requesting reconsideration. First 
time applicants are those that did not submit a timely application in 
response to the May 25, 2005 (70 FR 30067), NOFA. Prior applicants are 
those that: (1) Submitted timely and complete applications under the 
May 25, 2005, NOFA; (2) were not selected for a grant award; and (3) 
would like to request consideration of their proposal under this 
notice. First time applicants should follow the directions in this 
notice and the Application Guide in preparing their applications and 
narrative proposals. The completed application package should be 
assembled in the order specified with all pages numbered sequentially 
or by section. If you submitted an application in 2003 or 2004, but did 
not submit a request for reconsideration in 2005, you must submit a 
complete new application package meeting current eligibility and 
content requirements. Prior applicants should follow the special 
instructions for reconsideration and submit a revised Standard Form 424 
(SF-424), a letter requesting reconsideration, and any supplemental 
material by the deadline.
A. Application Contents for First Time Applicants
    First time applicants must submit the following information for the 
application to be complete and considered for funding:
    Part A. A Completed SF 424, ``Application for Federal Assistance.'' 
This form must be signed by a person authorized to submit the proposal 
on behalf of the applicant. Note: SF 424 has recently been revised to 
include new required data elements, including a DUNS number. You must 
submit the revised form. Copies of this form are available in the 
application package available on line through the Agency Web site or 
through Grants.gov, or by request from the Agency contact listed above.
    Part B. Grant Proposal. The grant proposal is a narrative 
description prepared by the applicant that establishes the applicant's 
eligibility, identifies the eligible extremely high energy cost 
communities to be served by the grant, and describes the proposed grant 
project, the potential benefits of the project, and a proposed budget. 
The grant proposal should contain the following sections in the order 
indicated.
    1. Executive Summary. The Executive Summary is a one to two page 
narrative summary that: (a) Identifies the applicant, project title, 
and the key contact person with telephone and fax numbers, mailing 
address and e-mail address; (b) specifies the amount of grant funds 
requested; (c) provides a brief description of the proposed project 
including the eligible rural communities and residents to be served, 
activities and facilities to be financed, and how the grant project 
will offset or reduce the target community's extremely high energy 
costs; and (d) identifies the associated State rural development 
initiative, if any, that the project supports. The Executive Summary 
should also indicate whether the applicant is claiming additional 
points under any of the criteria designated as USDA priorities under 
this NOFA.
    2. Table of Contents. The application package must include a table 
of contents immediately after the Executive Summary with page numbers 
for all required sections, forms, and appendices.
    3. Applicant Eligibility. This section includes a narrative 
statement that identifies the applicant and supporting evidence 
establishing that the applicant has or will have the legal authority to 
enter into a financial assistance relationship with the Federal 
Government. Examples of supporting evidence of applicant's legal 
existence and eligibility include: A reference to or copy of the 
relevant statute, regulation, executive order, or legal opinion 
authorizing a State, local, or tribal

[[Page 46201]]

government program, articles of incorporation or certificates of 
incorporation for corporate applicants, partnership or trust 
agreements, board resolutions. Applicants must also be free of any 
debarment or other restriction on their ability to contract with the 
Federal Government.
    4. Community Eligibility. This section provides a narrative 
description of the community or communities to be served by the grant 
and supporting information to establish eligibility. The narrative must 
show that the proposed grant project's target area or areas are located 
in one or more communities where the average residential energy costs 
exceed one or more of the benchmark criteria for extremely high energy 
costs as described in this NOFA. The narrative should clearly identify 
the location and population of the areas to be aided by the grant 
project and their energy costs and the population of the local 
government division in which they are located. Local energy providers 
and sources of high energy cost data and estimates should be clearly 
identified. Neither the applicant nor the project must be physically 
located in the extremely high energy cost community, but the funded 
project must serve an eligible community.
    The population estimates should be based on the results of the 2000 
Census available from the U.S. Census Bureau. Additional information 
and exhibits supporting eligibility may include maps, summary tables, 
and references to statistical information from the U.S. Census, the 
Energy Information Administration, other Federal and State agencies, or 
private sources. The Application Guide includes additional information 
and sources that the applicant may find useful in establishing 
community eligibility.
    5. Coordination with State Rural Development Initiatives. In this 
section the applicant must describe how the proposed grant is 
coordinated with and supports any rural development efforts. The 
applicant should provide supporting references or documentation of any 
relationship or contribution to State rural development initiatives.
    6. Project Overview. This section includes the applicant's 
narrative overview of its proposed project. The narrative must address 
the following:
    a. Project design: This section must provide a narrative 
description of the project including a proposed scope of work 
identifying major tasks and proposed schedules for task completion, a 
detailed description of the equipment, facilities and associated 
activities to be financed with grant funds, the location of the 
eligible extremely high energy cost communities to be served, and an 
estimate of the overall duration of the project. The Project Design 
description should be sufficiently detailed to support a finding of 
technical feasibility. Proposed projects involving construction, 
repair, replacement, or improvement of electric generation, 
transmission, and distribution facilities must generally be consistent 
with the standards and requirements for projects financed with loans 
and loan guarantees under the RE Act as set forth in the Agency's 
Electric Programs Regulations and Bulletins and may reference these 
requirements.
    b. Project management: This section must provide a narrative 
describing the applicant's capabilities and project management plans. 
The description should address the applicant's organizational 
structure, method of funding, legal authority, key personnel, project 
management experience, financial management systems, staff resources, 
the goals and objectives of the program or business, and any related 
services provided to the project beneficiaries. A current financial 
statement and other supporting documentation may be referenced here and 
included under the Supplementary Material section. If the applicant 
proposes to use affiliated entities, contractors, or subcontractors to 
provide services funded under the grant, the applicant must describe 
the identities, relationship, qualifications, and experience of these 
affiliated entities.
    The experience and capabilities of these entities will be reviewed 
by the rating panel. If the applicant proposes to secure equipment, 
design, construction, or other services from non-affiliated entities, 
the applicant must briefly describe how it plans to procure and/or 
contract for such equipment or services. The applicant should provide 
information that will support a finding that the combination of 
management team's experience, financial management capabilities, 
resources and project structure will enable successful completion of 
the project. Applicants are encouraged to review the financial 
management requirements for Federal grantees in 7 CFR part 1709 and 
USDA financial assistance regulations at 7 CFR parts 3015, 3016, 3017, 
3018, 3019, and 3052, as applicable, and to address their ability to 
comply with these requirements in their applications.
    c. Regulatory and other approvals: The applicant must identify any 
other regulatory or other approvals required by other Federal, State, 
local, or tribal agencies, or by private entities as a condition of 
financing that are necessary to carry out the proposed grant project 
and its estimated schedule for obtaining the necessary approvals.
    d. Benefits of the proposed project. The applicant should describe 
how the proposed project would benefit the target area and eligible 
communities. The description must specifically address how the project 
will improve energy generation, transmission, or distribution 
facilities serving the target area. The applicant should clearly 
identify how the project addresses the energy needs of the community 
and include appropriate measures of project success such as, for 
example, expected reductions in household or community energy costs, 
avoided cost increases, enhanced reliability, or economic or social 
benefits from improvements in energy services available to the target 
community. The applicant should include quantitative estimates of cost 
or energy savings and other benefits. The applicant should provide 
documentation or references to support its statements about cost-
effectiveness, savings and improved services. The applicant should also 
describe how it plans to measure and monitor the effectiveness of the 
program in delivering its projected benefits.
    7. Proposed Project Budget. The applicant must submit a proposed 
budget for the grant program on SF-424A, ``Budget Information--Non-
Construction Programs'' or SF-424C, ``Standard Form for Budget 
Information--Construction Programs,'' as applicable. All applicants 
that submit applications through Grants.gov must use SF-424A. The 
applicant should supplement the budget summary form with more detailed 
information describing the basis for cost estimates. The detailed 
budget estimate should itemize and explain major proposed project cost 
components such as, but not limited to, the expected costs of design 
and engineering and other professional services, personnel costs 
(salaries/wages and fringe benefits), equipment, materials, property 
acquisition, travel (if any), and other direct costs, and indirect 
costs, if any. The budget must document that planned administrative and 
other expenses of the project sponsor that are not directly related to 
performance of the grant will not total more than 4 percent of grant 
funds. The applicant must also identify the source and amount of any 
other Federal or non-Federal contributions of funds or services that 
will be used to support the proposed project. This program does not 
require supplemental or matching funds for eligibility; however, the 
Agency will award additional rating points for programs that include a 
match of other

[[Page 46202]]

funds or like-kind contributions to support the project.
    8. Supplementary Material. The applicant may append any additional 
information relevant to the proposal or which may qualify the 
application for extra points under the evaluation criteria described in 
this NOFA.
    Part C. Additional Required Forms and Certifications. In order to 
establish compliance with other Federal requirements for financial 
assistance, the applicant must execute and submit with the initial 
application the following forms and certifications:
     SF-424B, ``Assurances--Non-Construction Programs'' or SF-
424D, ``Assurances--Construction Programs'' (as applicable). All 
applicants applying through Grants.gov must use form SF-424B.
     SF-LLL, ``Disclosure of Lobbying Activities.''
     ``Certification Regarding Debarment, Suspension and Other 
Responsibility Matter--Primary Covered Transactions'' as required under 
7 CFR part 3017, Appendix A. Certifications for individuals, 
corporations, nonprofit entities, Indian tribes, partnerships.
     Environmental Profile. The Agency environmental profile 
template included in the Application Guide solicits information about 
project characteristics and site-specific conditions that may involve 
environmental, historic preservation, and other resources. The profile 
will be used by the Agency's environmental staff to identify selected 
projects that may require additional environmental reviews, 
assessments, or environmental impact statements before a final grant 
award may be approved. A copy of the environmental profile and 
instructions for completion are included in the Application Guide and 
may be downloaded from the Agency Web site or Grants.gov.
B. Special Requirements for Applicants Requesting Reconsideration of an 
Application Submitted in 2005
    Applicants that wish to request reconsideration of their 
application packages submitted in July 2005 in response to the NOFA 
published on May 25, 2005 in this round of competitive funding must 
submit an updated original SF 424, including new mandatory data 
elements (DUNS number, fax number, and e-mail address) along with a 
brief signed letter request for reconsideration identifying any 
additional information that they wish to be considered by the rating 
panel in reviewing their application along with supporting 
documentation. Applicants must confirm that their community continues 
to meet the eligibility benchmarks in Table 1 and may submit additional 
information to support their continued eligibility. The required 
application package will consist of the original signed SF 424, the 
request for reconsideration, and any additional supporting documents, 
plus the original application package submitted to the Agency in July 
2005. The Agency has maintained these prior applications on file and 
will add the newly submitted material to the existing application 
package for review by the rating panel. You do not need to send a copy 
of the 2005 application package. Because this abbreviated application 
package differs from the general application package for first time 
applicants available through Grants.gov, applicants requesting 
reconsideration should submit their requests directly to the Agency by 
the application deadline and not through Grants.gov. Applicants that 
submitted an application in 2005 also have the option of submitting an 
entirely new complete application package for their project in response 
to this NOFA. .

3. Additional Information Requests

    In addition to the information required to be submitted in the 
application package, the Agency may request that successful grant 
applicants provide additional information, analyses, forms and 
certifications as a condition of pre-award clearance, including any 
environmental reviews or other reviews or certifications required under 
USDA and Government-wide assistance regulations. The Agency will advise 
the applicant in writing of any additional information required.

4. Submitting the Application

    Applicants that are submitting paper application packages must 
submit one original application package that includes original 
signatures on all required forms and certifications and two copies. 
Applications should be submitted on 8\1/2\ by 11 inch white paper. 
Supplemental materials, such as maps, charts, plans, and photographs 
may exceed this size requirement.
    A completed paper application package must contain all required 
parts in the order indicated in the above section on ``Content and Form 
of Application Submission.'' The application package should be 
paginated either sequentially or by section. Applicants are requested 
to provide the application package in single-sided format for ease of 
copying.
    Applicants that are submitting application packages electronically 
through the federal grants portal Grants.gov (http://www.Grants.gov) 
must follow the application requirements and procedures and use the 
forms provided there. The Grants.gov Web site contains full 
instructions on all required registration, passwords, credentialing and 
software required to submit applications electronically. Grants.gov has 
streamlined the registration and credentialing process and now requires 
separate application processes for individuals and organizations. 
Individual applicants, including individuals applying on behalf of an 
organization, should follow the special directions for individuals on 
the Grants.gov Web site. Organizational applicants and sole 
proprietorships should follow the instructions for organizations.
    Organizational applicants are advised that completion of the 
requirements for registration with Grants.gov, with the Central 
Contractor Registry, and e-Authentication required under Grants.gov may 
take a week or more and may be delayed. Accordingly, the Agency 
strongly recommends that you complete your organization's registration 
with Grants.gov well in advance of the deadline for submitting 
applications.
    USDA encourages both individual and organizational applicants who 
wish to apply through Grants.gov to submit their applications in 
advance of the deadlines. Early submittal will give you time to resolve 
any system problems or technical difficulties with an electronic 
application through the customer support resources available at the 
Grants.gov Web site while preserving the option of submitting a timely 
paper application if any difficulties can not be resolved.

5. Disclosure of Information

    All material submitted by the applicant may be made available to 
the public in accordance with the Freedom of Information Act (5 U.S.C. 
552) and USDA's implementing regulations at 7 CFR part 1.

6. Submission Dates and Times

    Applications must be postmarked or hand delivered to the Agency or 
posted to Grants.gov by October 1, 2007. The Agency will begin 
accepting applications on the date of publication of this NOFA. The 
Agency will accept for review all applications postmarked or delivered 
to us by this deadline. Late applications will not be considered and 
will be returned to the applicant.
    For the purposes of determining the timeliness of an application 
the Agency will accept the following as valid

[[Page 46203]]

postmarks: The date stamped by the United States Postal Service on the 
outside of the package containing the application delivered by U.S. 
Mail; the date the package was received by a commercial delivery 
service as evidenced by the delivery label; the date received via hand 
delivery to the Agency headquarters; and the date an electronic 
application was posted for submission to Grants.gov.

7. Intergovernmental Review

    This program is not subject to the requirements of Executive Order 
12372, ``Intergovernmental Review of Federal Programs,'' as implemented 
under USDA's regulations at 7 CFR part 3015.

8. Funding Restrictions

    Section 19 of the RE Act provides that no more than 4 percent of 
the grant funds may be used for the planning and administrative 
expenses of the grantee not directly related to the grant project.

9. Other Submission Requirements

    Applicants that are submitting paper applications must submit one 
original application package that includes original signatures on all 
required forms and certifications and two copies.
    Applications should be single-sided and submitted on 8\1/2\ by 11 
inch white paper. Supplemental materials, such as maps, charts, plans, 
and photographs may exceed this size requirement.
    A completed application for first time applicants must contain all 
required parts in the order indicated in the above section on ``Content 
and Form of Application Submission.'' The application package should be 
paginated either sequentially or by section. Applicants seeking 
reconsideration should follow the special instructions above.
    The completed paper application package and two copies must be 
delivered to the Agency headquarters in Washington, DC using United 
States Mail, overnight delivery service, or by hand to the following 
address: United States Department of Agriculture, Rural Development 
Electric Programs, 1400 Independence Avenue, SW., STOP 1560, Room 5165 
South Building, Washington, DC 20250-1560. Applications should be 
marked ``Attention: High Energy Cost Community Grant Program.''
    Applicants are advised that regular mail deliveries to Federal 
Agencies, especially of oversized packages and envelopes, continue to 
be delayed because of increased security screening requirements. 
Applicants may wish to consider using Express Mail or a commercial 
overnight delivery service instead of regular mail. Applicants wishing 
to hand deliver or use courier services for delivery should contact the 
Agency representative in advance to arrange for building access. The 
Agency advises applicants that because of intensified security 
procedures at government facilities that any electronic media included 
in an application package may be damaged during security screening. If 
an applicant wishes to submit such materials, they should contact the 
agency representative for additional information.
    The Agency will accept electronic applications through the Federal 
Web portal at http://www.Grants.gov. Applicants wishing to submit 
electronic applications through Grants.gov must follow the application 
procedures and submission requirements detailed on that Web site at 
http://www.Grants.gov. Applicants that file through Grants.gov should 
receive electronic confirmation from Grants.gov that their applications 
have been received within 48 hours of submitting the application. 
Grants.gov will send a second electronic message that the application 
has either been successfully accepted by the system for transmission to 
the grantor agency OR has been rejected due to errors. After the grant 
application deadline has passed, USDA will send an electronic 
confirmation acknowledging that the application has been received by 
the Agency from Grants.gov. Grants.gov will not accept applications for 
filing after the deadline has passed. The Agency will not accept 
applications directly over the Internet, by e-mail, or fax.
    Applicants should be aware that Grants.gov requires that applicants 
complete several preliminary registrations and e-authentication 
requirements before being allowed to submit applications 
electronically. Applicants should consult the Grants.gov Web site and 
allow ample time to complete the steps required for registration before 
submitting their applications. Applicants may download application 
materials and complete forms online through Grants.gov without 
completing the registration requirements. Application materials 
prepared online may be printed and submitted in paper to the Agency as 
detailed above.

10. Multiple Applications

    Eligible applicants may submit only one application per project. 
Multiple tasks and localities may be included in a single proposed 
grant project. No more than $5 million in grant funds will be awarded 
per project. Applicants may, however, submit applications for more than 
one project.

V. Application Review Information

    All applications for grants must be delivered to the Agency at the 
address listed above or postmarked no later than October 1, 2007 to be 
eligible. After the deadline has passed, the Agency will review each 
timely-submitted application to determine whether it is complete and 
meets all of the eligibility requirements described in this NOFA.
    After the application closing date, the Agency will not consider 
any unsolicited information from the applicant. The Agency may contact 
the applicant for additional information or to clarify statements in 
the application required to establish applicant or community 
eligibility and completeness. Only applications that are complete and 
meet the eligibility criteria will be considered. The Agency will not 
accept or solicit any additional information relating to the technical 
merits and/or economic feasibility of the grant proposal after the 
application closing date.
    If the Agency determines that an application package was not 
delivered to the Agency, or postmarked on or before the deadline of 
October 1, 2007, the application will be rejected as untimely and 
returned to the applicant.
    After review, the Agency will reject any application package that 
it determines is incomplete or that does not demonstrate that the 
applicant, community or project is eligible under the requirements of 
this NOFA and program regulations. The Assistant Administrator, 
Electric Programs, will notify the applicant of the rejection in 
writing and provide a brief explanation of the reasons for rejection.
    Applicants may appeal the rejection pursuant to program regulations 
on appeals at 7 CFR 1709.6. The appeal must be made, in writing to the 
Agency Administrator, within 10 days after the applicant is notified of 
the determination to reject the application. The appeal must state the 
basis for the appeal. Under 7 CFR 1709.6 appeals must be directed to 
the Administrator, Rural Utilities Service, Rural Development Utilities 
Programs, United States Department of Agriculture, 1400 Independence 
Ave., SW., STOP 1500, Washington, DC 20250-1500. The Administrator will 
review the appeal to determine whether to sustain, reverse, or modify 
the original determination by the Assistant Administrator. The 
Administrator's decision shall be final. A written copy of the 
Administrator's decision will be furnished promptly to the applicant.

[[Page 46204]]

    The Agency may establish one or more rating panels to review and 
rate the eligible grant applications. These panels may include persons 
not currently employed by USDA.
    The panel will evaluate and rate all complete applications that 
meet the eligibility requirements using the selection criteria and 
weights described in this NOFA. As part of the proposal review and 
ranking process, panel members may make comments and recommendations 
for appropriate conditions on grant awards to promote successful 
performance of the grant or to assure compliance with other Federal 
requirements. The decision to include panel recommendations on grant 
conditions in any grant award will be at the sole discretion of the 
Administrator.
    All applications will be scored and ranked according to the 
evaluation criteria and weightings described in this Notice. The 
evaluation criteria and weights in this NOFA differ from those used in 
prior NOFAs. For this reason, the ratings panel will review and revise 
scores of any prior applications that are being reconsidered according 
to the new criteria. The rating panel may revise the score upward based 
on any updated information submitted by the applicant.
    The Agency will use the ratings and recommendations of the panel to 
rank applicants against other applicants. All applicants will be ranked 
according to their scores in this round. The rankings and 
recommendations will then be forwarded to the Administrator for final 
review and selection.
    Decisions on grant awards will be made by the Agency Administrator 
based on the application, and the rankings and recommendations of the 
rating panel. The Administrator will fund grant requests in rank order 
to the extent of available funds. If sufficient funds are not available 
to fund the next ranked project, the Administrator may in his sole 
discretion, offer a partial award to the next project, or skip over 
that project to the next ranking project that can be supported with 
available funding. Should additional funds become available, the 
Administrator may in his sole discretion, make additional awards to 
unfunded applications submitted under this NOFA in rank order.

1. Criteria

    The Agency will use the selection criteria described in this NOFA 
to evaluate and rate applications and will award points up to the 
maximum number indicated under each criterion. Applicants should 
carefully read the information on the rating criteria in this NOFA and 
the Application Guide and address all criteria. The maximum number of 
points that can be awarded is 100 points. The Agency will award up to 
65 points for project design and technical merit criteria and up to 35 
points based on priority criteria for project or community 
characteristics that support USDA Rural Development and Agency program 
priorities.
A. Project Design and Technical Merit Criteria
    Reviewers will consider the soundness of applicant's approach, the 
technical feasibility of the project, the adequacy of financial and 
other resources, the competence and experience of the applicant and its 
team, the project goals and objectives, and community needs and 
benefits. A total of 65 points may be awarded under these criteria.
    1. Comprehensiveness and feasibility of approach. (Up to 30 
points). Raters will assess the technical and economic feasibility of 
the project and how well its goals and objectives address the 
challenges of the extremely high energy cost community. The panel will 
review the proposed design, construction, equipment, and materials for 
the community energy facilities in establishing technical feasibility. 
Reviewers may propose additional conditions on the grant award to 
assure that the project is technically sound. Reviewers will consider 
the adequacy of the applicant's budget and resources to carry out the 
project as proposed and how the applicant proposes to manage available 
resources such as other grants, program income, and any other financing 
sources to maintain and operate a financially viable project once the 
grant period has ended.
    2. Demonstrated experience. (Up to 10 points). Reviewers will 
consider whether the applicant and its project team have demonstrated 
experience in successfully administering and carrying out projects that 
are comparable to that proposed in the grant application. The Agency 
supports and encourages emerging organizations that desire to develop 
the internal capacity to improve energy services in rural communities. 
In evaluating the capabilities of entities without extensive experience 
in carrying out such projects, the Agency will consider the experience 
of the project team and the effectiveness of the program design in 
compensating for lack of extensive experience.
    3. Community Needs. (Up to 15 points). Reviewers will consider the 
applicant's identification and documentation of eligible communities, 
their populations, and assessment of community energy needs to be 
addressed by the grant project. Information on the severity of physical 
and economic challenges affecting eligible communities will be 
considered. Reviewers will weigh: (1) The applicant's analysis of 
community energy challenges and (2) why the applicant's proposal 
presents a greater need for Federal assistance than other competing 
applications. In assessing the applicant's demonstration of community 
needs, the rating panel will consider information in the narrative 
proposal addressing:
    (a) The burden placed on the community and individual households by 
extremely high energy costs as evidenced by such quantitative measures 
as, for example, total energy expenditures, per unit energy costs, 
energy cost intensity for occupied space, or energy costs as a share of 
average household income, and persistence of extremely high energy 
costs compared to national or statewide averages.
    (b) The hardships created by limited access to reliable and 
affordable energy services; and
    (c) The availability of other resources to support or supplement 
the proposed grant funding.
    4. Project Evaluation Methods. (Up to 5 points). Reviewers will 
consider the applicant's plan to evaluate and report on the success and 
cost-effectiveness of financed activities and whether the results 
obtained will contribute to program improvements for the applicant or 
for other entities interested in similar programs.
    5. Coordination with State Rural Development Initiatives. (Up to 5 
points). Raters will assess how effectively the proposed project is 
coordinated with State rural development initiatives, if any, and is 
consistent with and supports these efforts. The Agency will consider 
the documentation submitted for coordination efforts, community 
support, and State or local government recommendations. Applicants 
should identify the extent to which the project is dependent on or tied 
to other rural development initiatives, funding, and approvals. 
Applicants are advised that they should address this criterion 
explicitly even if only to report that the project is not coordinated 
with or supporting a State rural development initiative. Failure to 
address this criterion will result in zero points awarded.
B. Priority Criteria
    In addition to the points awarded for project design and technical 
merit, all proposals will be reviewed and awarded additional points 
based on certain

[[Page 46205]]

characteristics of the project or the target community. USDA Rural 
Development policies generally encourage agencies to give priority in 
their programs to rural areas of greatest need and to support other 
Federal policy initiatives. In furtherance of these policies, the 
Agency will award additional points for the priorities identified in 
this notice. The priority criteria and point scores used in this NOFA 
are consistent with the program regulations in 7 CFR part 1709. The 
Agency will give priority consideration to smaller communities, areas 
suffering significant economic hardship, areas with inadequate 
community energy services, and areas where the condition of community 
energy facilities (or absence thereof) presents an imminent hazard to 
public health or safety. Priority points will also be awarded for 
proposals that include cost sharing. A maximum of 35 total points may 
be awarded under these priority criteria.
    1. Economic Hardship. (Up to 15 points). The community experiences 
one or more economic hardship conditions that impair the ability of the 
community and/or its residents to provide basic energy services or to 
reduce or limit the costs of these services. Economic hardship will be 
assessed using either the objective measure of county median income 
under Option A below or subjectively under Option B based on the 
applicant's description of the community's economic hardships and 
supporting materials. Applicants may elect either measure, but not 
both.
    Option A. Economically Distressed Communities (up to 15 points). 
The target community is an economically distressed county or Indian 
reservation where the median household income is significantly below 
the State average. Points will be awarded based on the county 
percentage of State median household income (or reservation percentage 
of State median household income in the case of Federally recognized 
Indian reservations) according to the following:
    (1) Less than 70 percent of the State median household income, 15 
points;
    (2) 70 to 80 percent of the State median household income, 12 
points;
    (3) 80 to 90 percent of the State median household income, 10 
points;
    (4) 90 to 95 percent of the State median household income, 5 
points; or
    (5) over 95 percent of the State median household income, 0 points.
    Information on State and county median income is available online 
from the USDA Economic Research Service at http://www.ers.usda.gov/data/unemployment/. Information on Indian reservations is available 
through the U.S. Census at http://www.census.gov.
    Option B. Other Economic Hardship (up to 15 points). The community 
suffers from other conditions creating a severe economic hardship that 
is adequately described and documented by the applicant. Examples 
include but are not limited to natural disasters, financially 
distressed local industry, and loss of major local employer, persistent 
poverty, outmigration, or other conditions adversely affecting the 
local economy, or contributing to unserved or underserved energy 
infrastructure needs that affect the economic health of the community. 
The rating panel may assign points under this criterion, in lieu of 
awarding points based on the percentage of median household income.
    2. Rurality. (Up to 14 points). Consistent with the USDA Rural 
Development policy to target resources to rural communities with 
significant needs and recognizing that smaller communities are often 
comparatively disadvantaged in seeking assistance, reviewers will award 
additional points based on the rurality (as measured by population) of 
the target communities to be served with grant funds. Applications will 
be scored based on the population of the largest incorporated cities, 
towns, or villages, or census designated places included within the 
grant's proposed target area.
    Points will be awarded on the population of the largest target 
community within the proposed target area as follows:
    (A) 2,500 or less, 14 points;
    (B) Between 2,501 and 5,000, inclusive, 12 points;
    (C) Between 5,001 and 10,000, inclusive, 8 points;
    (D) Between 10,001 and 15,000, inclusive, 5 points;
    (E) Between 15,001 and 20,000, inclusive, 2 points; and
    (F) Above 20,000, 0 points.
    Applicants must use the latest available population figures from 
Census 2000 available at http://www.census.gov/main/www/cen2000.html 
for every incorporated city, town, or village, or Census designated 
place included in the target area.
    3. Unserved Energy Needs (2 points). Consistent with the purposes 
of the RE Act, projects that meet unserved or underserved energy needs 
will be eligible for 2 points. Examples of proposals that may qualify 
under this priority include projects that extend or improve electric or 
other energy services to communities and customers that do not have 
reliable centralized or commercial service or where many homes remain 
without such service because the costs are unaffordable.
    4. Imminent hazard (2 points). If the grant proposal involves a 
project to correct a condition posing an imminent hazard to public 
safety, welfare, the environment, or to a critical community or 
residential energy facility, raters may award 2 points. Examples 
include community energy facilities in immediate danger of failure 
because of deteriorated condition, capacity limitations, damage from 
natural disasters or accidents, or other conditions where impending 
failure of existing facilities or absence of energy facilities creates 
a substantial threat to public health or safety, or to the environment.
    5. Cost Sharing (2 points). This grant program does not require any 
cost contribution. In addition to their assessment of the economic 
feasibility and sustainability of the project under the project 
evaluation factors above, raters may award 2 points for cost sharing. 
These points will be awarded when the proposal documents supplemental 
contributions of funds, property, equipment, services, or other in kind 
contributions for the project evidencing the applicant's and/or 
community's commitment to the project that taken together exceed 10 
percent of the total project costs. The applicant must specifically 
request additional points for cost sharing.

2. Review and Selection Process

A. Scoring and Ranking of Applications
    Following the evaluation and rating of individual applications 
under the above criteria, the rating panel will rank the applications 
in numerical order according to their total scores. The scored and 
ranked applications and the raters' comments will then be forwarded to 
the Administrator for review and selection of grant awards.
B. Selection of Grant Awards and Notification of Applicants
    The Agency Administrator will review the rankings and 
recommendations of the applications provided by the rating panel for 
consistency with the requirements of this NOFA. The Administrator may 
return any application to the rating panel with written instruction for 
reconsideration if, in his sole discretion, he finds that the scoring 
of an application is inconsistent with this NOFA and the directions 
provided to the rating panel.
    Following any adjustments to the project rankings as a result of

[[Page 46206]]

reconsideration, the Administrator will select projects for funding in 
rank order. If funds remain after funding the highest ranking 
application, the Agency may fund all or part of the next highest 
ranking application. The Agency will advise an applicant if it cannot 
fully fund a grant request and ask whether the applicant will accept a 
reduced award.
    The Administrator may decide based on the recommendations of the 
rating panel or in his sole discretion that a grant award may be made 
fully or partially contingent upon the applicant satisfying certain 
conditions or providing additional information and analyses. For 
example, the Agency may defer approving a final award to a selected 
project--such as projects requiring more extensive environmental review 
and mitigation, preparation of detailed site specific engineering 
studies and designs, or requiring local permitting, or availability of 
supplemental financing--until any additional conditions are satisfied. 
In the event that a selected applicant fails to comply with the 
additional conditions within the time set by the Agency, the selection 
will be vacated and the next ranking project will be considered.
    If a selected applicant turns down a grant award offer, or fails to 
conclude a grant agreement acceptable to the Agency, or to provide 
required information requested by the Agency within the time period 
established in the notification of selection for grant award, the 
Agency Administrator may select for funding the next highest ranking 
application submitted in response to this NOFA. If sufficient funds are 
not available to fund the next ranked project, the Administrator may in 
his sole discretion, offer a partial award to the next project, or skip 
over that project to the next ranking project that can be supported 
with available funding. Should additional funds become available in 
Fiscal Year 2007 or in a subsequent Fiscal Year prior to the next 
solicitation of competitive grant applications, the Administrator may 
in his sole discretion, make additional awards to unfunded applications 
submitted under this NOFA in rank order. The Agency will notify each 
applicant in writing whether or not it has been selected for an award. 
The Agency's written notice to a successful applicant of the amount of 
the grant award based on the approved application will constitute the 
Agency's preliminary acceptance of a project for an award, subject to 
compliance with all post-selection requirements including but not 
limited to completion of any environmental reviews and negotiation and 
execution of a grant agreement satisfactory to the Agency. This 
preliminary acceptance does not bind the Government to making a final 
grant award. Only a final grant award and agreement executed by the 
Administrator will constitute a binding obligation and commitment of 
Federal funds. Funds will not be awarded or disbursed until all 
requirements have been satisfied and are contingent on the continued 
availability of appropriated funds at the time of the award. The Agency 
will advise selected applicants of additional requirements or 
conditions.
C. Adjustments to Funding
    The Agency reserves the right to fund less than the full amount 
requested in a grant application to ensure the fair distribution of the 
funds and to ensure that the purposes of a specific program are met. 
The Agency will not fund any portion of a grant request that is not 
eligible for funding under Federal statutory or regulatory 
requirements; that does not meet the requirements of this NOFA, or that 
may duplicate other Agency-funded activities, including electric loans. 
Only the eligible portions of a successful grant application will be 
funded.
    Grant assistance cannot exceed the lower of:
    (a) The qualifying percentage of eligible project costs requested 
by the applicant; or
    (b) The minimum amount sufficient to provide for the economic 
feasibility of the project as determined by the Agency.

VI. Award Administration Information

1. Award Notices

    The Agency will notify all applicants in writing whether they have 
been selected for an award. Successful applicants will be advised in 
writing of their selection as award finalists. Successful applicants 
will be required to negotiate a grant agreement acceptable to the 
Agency and complete additional grant forms and certifications required 
by USDA as part of the pre-award process.
    Depending on the nature of the activities proposed by the 
application, the grantee may be asked to provide information and 
certifications necessary for compliance with The Agency's environmental 
policy regulations and procedures for Electric Programs at 7 CFR part 
1794. Following completion of the environmental review, selected 
applicants will receive a letter of conditions establishing any 
project-specific conditions to be included in the grant agreement and 
asked to execute a letter of intent to meet the grant conditions or to 
detail why such conditions can't be met and to propose alternatives. 
Grant funds will not be advanced unless and until the applicant has 
executed a grant agreement acceptable to the Agency.
    The Agency will require each successful applicant to agree to the 
specific terms of each grant agreement, a project budget, and other 
program requirements. In cases where the Agency cannot successfully 
conclude negotiations with a selected applicant or a selected applicant 
fails to provide requested information within the time specified, an 
award will not be made to that applicant. The selection will be revoked 
and the Agency may offer an award to the next highest ranking 
applicant, and proceed with negotiations with the next highest ranking 
applicant, subject to the availability of funds.

2. Administrative and National Policy Requirements

A. Environmental Review and Restriction on Certain Activities
    Grant awards are required to comply with 7 CFR part 1794, which 
sets forth Agency regulations implementing the National Environmental 
Policy Act (NEPA). Grantees must also agree to comply with any other 
Federal or State environmental laws and regulations applicable to the 
grant project.
    If the proposed grant project involves physical development 
activities or property acquisition, the applicant is generally 
prohibited from acquiring, rehabilitating, converting, leasing, 
repairing or constructing property or facilities, or committing or 
expending Agency or non-Agency funds for proposed grant activities 
until the Agency has completed any environmental review in accordance 
with 7 CFR part 1794 or determined that no environmental review is 
required. Successful applicants will be advised whether additional 
environmental review and requirements apply to their proposals.
B. Other Federal Requirements
    Other Federal statutes and regulations apply to grant applications 
and to grant awards. These include, but are not limited to, 
requirements under 7 CFR part 15, subpart A--Nondiscrimination in 
Federally Assisted Programs of the Department of Agriculture--
Effectuation of Title VI of the Civil Rights Act of 1964.

[[Page 46207]]

    Certain Office of Management and Budget (OMB) circulars also apply 
to USDA grant programs and must be followed by a grantee under this 
program. The policies, guidance, and requirements of the following, or 
their successors, may apply to the award, acceptance and use of 
assistance under this program and to the remedies for noncompliance, 
except when inconsistent with the provisions of the Agriculture, Rural 
Development and Related Agencies Appropriations Acts, other Federal 
statutes or the provisions of this NOFA:
     OMB Circular No. A-87 (Cost Principles Applicable to 
Grants, Contracts and Other Agreements with State and Local 
Governments);
     OMB Circular A-21 (Cost Principles for Education 
Institutions);
     OMB Circular No. A-122 (Cost Principles for Nonprofit 
Organizations);
     OMB Circular A-133 (Audits of States, Local Governments, 
and Non-Profit Organizations);
     7 CFR part 3015 (Uniform Federal Assistance Regulations);
     7 CFR part 3016 (Uniform Administrative Requirements for 
Grants and Cooperative Agreements to State, Local, and Federally 
recognized Indian tribal governments);
     7 CFR part 3017 (Government-wide debarment and suspension 
(non-procurement) and
     Government-wide requirements for drug-free workplace 
(grants));
     7 CFR part 3018 (New restrictions on Lobbying);
     7 CFR part 3019 (Uniform administrative requirements for 
grants and Agreements with Institutions of Higher Education, Hospitals, 
and other Non-Profit Organizations); and
     7 CFR part 3052 (Audits of States, local governments, and 
non-profit organizations).
    Compliance with additional OMB Circulars or government-wide 
regulations may be specified in the grant agreement.

3. Reporting

    The grantee will be required to provide periodic financial and 
performance reports under USDA grant regulations and program rules and 
to submit a final project performance report. The nature and frequency 
of required reports are established in USDA grant regulations and the 
project-specific grant agreements.

VII. Agency Contact

    The Agency Contact for this grant announcement is Karen Larsen, 
Management Analyst, United States Department of Agriculture, Rural 
Development Electric Programs, 1400 Independence Avenue, SW., STOP 
1560, Room 5165 South Building, Washington, DC 20250-1560. Telephone 
202-720-9545, Fax 202-690-0717, e-mail [email protected].

James M. Andrew,
Administrator, Rural Utilities Service.
[FR Doc. E7-16216 Filed 8-16-07; 8:45 am]
BILLING CODE 3410-15-P