Broadband Infrastructure Finance and Innovation Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 4127 To establish a broadband infrastructure finance and innovation program to make available loans, loan guarantees, and lines of credit for the con- struction and deployment of broadband infrastructure, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JULY 30, 2019 Mr. LUJA´N (for himself, Mr. PALLONE, Mr. MICHAEL F. DOYLE of Pennsyl- vania, Mr. RUSH, Ms. ESHOO, Mr. ENGEL, Ms. SCHAKOWSKY, Mr. BUTTERFIELD, Mr. MCNERNEY, Mr. WELCH, Mr. TONKO, Ms. CLARKE of New York, Mr. LOEBSACK, Mr. KENNEDY, Mr. CA´RDENAS, Mr. PETERS, Ms. KUSTER of New Hampshire, Ms. BARRAGA´N, Mr. O’HALLERAN, Mr. KHANNA, Mr. GARAMENDI, Mr. RYAN, Ms. MOORE, Mr. MCGOVERN, Ms. SPANBERGER, Mr. CUELLAR, and Ms. HAALAND) introduced the following bill; which was referred to the Committee on En- ergy and Commerce A BILL To establish a broadband infrastructure finance and innova- tion program to make available loans, loan guarantees, and lines of credit for the construction and deployment of broadband infrastructure, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 2 •HR 4127 IH SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 1 (a) SHORT TITLE.—This Act may be cited as the 2 ‘‘Broadband Infrastructure Finance and Innovation Act of 3 2019’’. 4 (b) TABLE OF CONTENTS.—The table of contents for 5 this Act is as follows: 6 Sec. 1. Short title; table of contents. Sec. 2. Definitions. Sec. 3. Determination of eligibility and project selection. Sec. 4. Secured loans. Sec. 5. Lines of credit. Sec. 6. Alternative prudential lending standards for small projects. Sec. 7. Program administration. Sec. 8. State and local permits. Sec. 9. Regulations. Sec. 10. Funding. Sec. 11. Reports to Congress. SEC. 2. DEFINITIONS. 7 In this Act: 8 (1) ASSISTANT SECRETARY.—The term ‘‘Assist- 9 ant Secretary’’ means the Assistant Secretary of 10 Commerce for Communications and Information. 11 (2) BIFIA PROGRAM.—The term ‘‘BIFIA pro- 12 gram’’ means the broadband infrastructure finance 13 and innovation program established under this Act. 14 (3) BROADBAND SERVICE.—The term ‘‘broad- 15 band service’’— 16 (A) means broadband internet access serv- 17 ice that is a mass-market retail service, or a 18 service provided to an entity described in para- 19 graph (12)(B)(ii), by wire or radio that pro- 20 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 3 •HR 4127 IH vides the capability to transmit data to and re- 1 ceive data from all or substantially all internet 2 endpoints, including any capabilities that are 3 incidental to and enable the operation of the 4 communications service; 5 (B) includes any service that is a func- 6 tional equivalent of the service described in sub- 7 paragraph (A); and 8 (C) does not include dial-up internet access 9 service. 10 (4) ELIGIBLE PROJECT COSTS.—The term ‘‘eli- 11 gible project costs’’ means amounts substantially all 12 of which are paid by, or for the account of, an obli- 13 gor in connection with a project, including the cost 14 of— 15 (A) development phase activities, including 16 planning, feasibility analysis, revenue fore- 17 casting, environmental review, historic preserva- 18 tion review, permitting, preliminary engineering 19 and design work, and other preconstruction ac- 20 tivities; 21 (B) construction and deployment phase ac- 22 tivities, including— 23 (i) construction, reconstruction, reha- 24 bilitation, replacement, and acquisition of 25 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 4 •HR 4127 IH real property (including land relating to 1 the project and improvements to land), 2 equipment, instrumentation, networking 3 capability, hardware and software, and dig- 4 ital network technology; 5 (ii) environmental mitigation; and 6 (iii) construction contingencies; and 7 (C) capitalized interest necessary to meet 8 market requirements, reasonably required re- 9 serve funds, capital issuance expenses, and 10 other carrying costs during construction and 11 deployment. 12 (5) FEDERAL CREDIT INSTRUMENT.—The term 13 ‘‘Federal credit instrument’’ means a secured loan, 14 loan guarantee, or line of credit authorized to be 15 made available under the BIFIA program with re- 16 spect to a project. 17 (6) INVESTMENT-GRADE RATING.—The term 18 ‘‘investment-grade rating’’ means a rating of BBB 19 minus, Baa3, bbb minus, BBB (low), or higher as- 20 signed by a rating agency to project obligations. 21 (7) LENDER.—The term ‘‘lender’’ means any 22 non-Federal qualified institutional buyer (as defined 23 in section 230.144A(a) of title 17, Code of Federal 24 Regulations (or any successor regulation), known as 25 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 5 •HR 4127 IH Rule 144A(a) of the Securities and Exchange Com- 1 mission and issued under the Securities Act of 1933 2 (15 U.S.C. 77a et seq.)), including— 3 (A) a qualified retirement plan (as defined 4 in section 4974(c) of the Internal Revenue Code 5 of 1986) that is a qualified institutional buyer; 6 and 7 (B) a governmental plan (as defined in 8 section 414(d) of the Internal Revenue Code of 9 1986) that is a qualified institutional buyer. 10 (8) LETTER OF INTEREST.—The term ‘‘letter 11 of interest’’ means a letter submitted by a potential 12 applicant prior to an application for credit assistance 13 in a format prescribed by the Assistant Secretary on 14 the website of the BIFIA program that— 15 (A) describes the project and the location, 16 purpose, and cost of the project; 17 (B) outlines the proposed financial plan, 18 including the requested credit assistance and 19 the proposed obligor; 20 (C) provides a status of environmental re- 21 view; and 22 (D) provides information regarding satis- 23 faction of other eligibility requirements of the 24 BIFIA program. 25 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 6 •HR 4127 IH (9) LINE OF CREDIT.—The term ‘‘line of cred- 1 it’’ means an agreement entered into by the Assist- 2 ant Secretary with an obligor under section 5 to pro- 3 vide a direct loan at a future date upon the occur- 4 rence of certain events. 5 (10) LOAN GUARANTEE.—The term ‘‘loan guar- 6 antee’’ means any guarantee or other pledge by the 7 Assistant Secretary to pay all or part of the prin- 8 cipal of and interest on a loan or other debt obliga- 9 tion issued by an obligor and funded by a lender. 10 (11) OBLIGOR.—The term ‘‘obligor’’ means a 11 party that— 12 (A) is primarily liable for payment of the 13 principal of or interest on a Federal credit in- 14 strument; and 15 (B) may be a corporation, company, part- 16 nership, joint venture, trust, or governmental 17 entity, agency, or instrumentality. 18 (12) PROJECT.—The term ‘‘project’’ means a 19 project— 20 (A) to construct and deploy infrastructure 21 for the provision of broadband service; and 22 (B) that the Assistant Secretary deter- 23 mines will— 24 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 7 •HR 4127 IH (i) provide access or improved access 1 to broadband service to consumers residing 2 in areas of the United States that have no 3 access to broadband service or do not have 4 access to broadband service offered— 5 (I) with a download speed of at 6 least 25 megabits per second; 7 (II) with an upload speed of at 8 least 3 megabits per second; and 9 (III) with latency that is suffi- 10 ciently low to allow real-time, inter- 11 active applications; or 12 (ii) provide access or improved access 13 to broadband service to— 14 (I) schools, libraries, medical and 15 healthcare providers, community col- 16 leges and other institutions of higher 17 education, and other community sup- 18 port organizations and entities to fa- 19 cilitate greater use of broadband serv- 20 ice by or through such organizations; 21 (II) organizations and agencies 22 that provide outreach, access, equip- 23 ment, and support services to facili- 24 tate greater use of broadband service 25 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 8 •HR 4127 IH by low-income, unemployed, aged, and 1 otherwise vulnerable populations; 2 (III) job-creating strategic facili- 3 ties located within a State-designated 4 economic zone, Economic Develop- 5 ment District designated by the De- 6 partment of Commerce, Renewal 7 Community or Empowerment Zone 8 designated by the Department of 9 Housing and Urban Development, or 10 Enterprise Community designated by 11 the Department of Agriculture; or 12 (IV) public safety agencies. 13 (13) PROJECT OBLIGATION.—The term 14 ‘‘project obligation’’ means any note, bond, deben- 15 ture, or other debt obligation issued by an obligor in 16 connection with the financing of a project, other 17 than a Federal credit instrument. 18 (14) PUBLIC AUTHORITY.—The term ‘‘public 19 authority’’ means a Federal, State, county, town, or 20 township, Indian Tribe, municipal or other local gov- 21 ernment or instrumentality with authority to fi- 22 nance, build, operate, or maintain infrastructure for 23 the provision of broadband service. 24 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 9 •HR 4127 IH (15) RATING AGENCY.—The term ‘‘rating agen- 1 cy’’ means a credit rating agency registered with the 2 Securities and Exchange Commission as a nationally 3 recognized statistical rating organization (as defined 4 in section 3(a) of the Securities Exchange Act of 5 1934 (15 U.S.C. 78c(a))). 6 (16) SECURED LOAN.—The term ‘‘secured 7 loan’’ means a direct loan or other debt obligation 8 issued by an obligor and funded by the Assistant 9 Secretary in connection with the financing of a 10 project under section 4. 11 (17) SMALL PROJECT.—The term ‘‘small 12 project’’ means a project having eligible project costs 13 that are reasonably anticipated not to equal or ex- 14 ceed $20,000,000. 15 (18) STATE.—The term ‘‘State’’ has the mean- 16 ing given such term in section 3 of the Communica- 17 tions Act of 1934 (47 U.S.C. 153). 18 (19) SUBSIDY AMOUNT.—The term ‘‘subsidy 19 amount’’ means the amount of budget authority suf- 20 ficient to cover the estimated long-term cost to the 21 Federal Government of a Federal credit instru- 22 ment— 23 (A) calculated on a net present value basis; 24 and 25 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 10 •HR 4127 IH (B) excluding administrative costs and any 1 incidental effects on governmental receipts or 2 outlays in accordance with the Federal Credit 3 Reform Act of 1990 (2 U.S.C. 661 et seq.). 4 (20) SUBSTANTIAL COMPLETION.—The term 5 ‘‘substantial completion’’ means, with respect to a 6 project receiving credit assistance under the BIFIA 7 program— 8 (A) the commencement of the provision of 9 broadband service using the infrastructure 10 being financed; or 11 (B) a comparable event, as determined by 12 the Assistant Secretary and specified in the 13 credit agreement. 14 SEC. 3. DETERMINATION OF ELIGIBILITY AND PROJECT SE- 15 LECTION. 16 (a) ELIGIBILITY.— 17 (1) IN GENERAL.—A project shall be eligible to 18 receive credit assistance under the BIFIA program 19 if— 20 (A) the entity proposing to carry out the 21 project submits a letter of interest prior to sub- 22 mission of a formal application for the project; 23 and 24 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 11 •HR 4127 IH (B) the project meets the criteria described 1 in this subsection. 2 (2) CREDITWORTHINESS.— 3 (A) IN GENERAL.—Except as provided in 4 subparagraph (B), to be eligible for assistance 5 under the BIFIA program, a project shall sat- 6 isfy applicable creditworthiness standards, 7 which, at a minimum, shall include— 8 (i) adequate coverage requirements to 9 ensure repayment; 10 (ii) an investment-grade rating from 11 at least 2 rating agencies on debt senior to 12 the Federal credit instrument; and 13 (iii) a rating from at least 2 rating 14 agencies on the Federal credit instrument. 15 (B) SMALL PROJECTS.—In order for a 16 small project to be eligible for assistance under 17 the BIFIA program, such project shall satisfy 18 alternative creditworthiness standards that shall 19 be established by the Assistant Secretary under 20 section 6 for purposes of this paragraph. 21 (3) APPLICATION.—A State, local government, 22 agency or instrumentality of a State or local govern- 23 ment, public authority, public-private partnership, or 24 any other legal entity undertaking the project and 25 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 12 •HR 4127 IH authorized by the Assistant Secretary shall submit a 1 project application that is acceptable to the Assist- 2 ant Secretary. 3 (4) ELIGIBLE PROJECT COST PARAMETERS FOR 4 INFRASTRUCTURE PROJECTS.—Eligible project costs 5 shall be reasonably anticipated to equal or exceed 6 $2,000,000 in the case of a project or program of 7 projects— 8 (A) in which the applicant is a local gov- 9 ernment, instrumentality of local government, 10 or public authority (other than a public author- 11 ity that is a Federal or State government or in- 12 strumentality); 13 (B) located on a facility owned by a local 14 government; or 15 (C) for which the Assistant Secretary de- 16 termines that a local government is substan- 17 tially involved in the development of the project. 18 (5) DEDICATED REVENUE SOURCES.—The ap- 19 plicable Federal credit instrument shall be repayable, 20 in whole or in part, from— 21 (A) amounts charged to— 22 (i) subscribers of broadband service 23 for such service; or 24 VerDate Sep 11 2014 04:43 Aug 06, 2019 Jkt 089200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H4127.IH H4127 kjohnson on DSK79L0C42 with BILLS 13 •HR 4127 IH (ii) subscribers of any related service 1 provided over the same infrastructure [Text truncated for display. 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