Yes plus you open any financials with the company awarded the funds up
to yearly audits. No this is a may be it is you will be audited by the
RUS if there is nothing built and money has gone out then you get no
more. Early on some people did this payed them selves an over priced
amount so now most you don't get paid till a portion of the project is
complete. So say you win a $5M grant and you have as one of the cost
items 10 miles of fiber between two cities for $500k. You could have
another company build and install it for the $500k, but that company
will not get paid until it is complete and tested. The RUS will not
release the money to the awarded party to pay the construction until
they have reviewed the project results. This usually consists of
industry standard as built along with FOC information if it is fiber.
The construction company will have to finance the entire build and even
after completion may not get paid for a few months.
There are several contract types. If you want to read through here is
the over all contract that lists all the others including hardware
purchases etc.
https://www.federalregister.gov/documents/2016/10/18/2016-24945/new-equipment-contract-rus-contract-form-395-for-telecommunications-and-broadband-borrowers
On 3/1/2019 4:23 PM, Matt Hoppes wrote:
I believe you have to clearly disclose all associations with sister companies
that you have and Own, so I’m not sure this would fly.
On Mar 1, 2019, at 5:11 PM, Ken Hohhof <[email protected]> wrote:
I don't know the answers, but regarding install equipment, couldn't you create
another company or subsidiary that buys all that fancy gear and then pay them
prevailing wage, so that they can pay for the equipment with the profits? At
the end of the project, your other company owns some plows, bucket trucks,
fusion splicers, etc. I think this is how it worked with some of the BTOP
middle mile projects.
-----Original Message-----
From: AF <[email protected]> On Behalf Of Matt Hoppes
Sent: Friday, March 1, 2019 3:50 PM
To: [email protected]
Subject: [AFMUG] Fiber and USDA/CAF
For anyone who has applied for usda or caf funding for fiber.
How did the process work for you? It seems like a catch 22.
Do you engineer the network first and then apply for the funds you need?
Or apply using good faith estimates and then engineer after you’ve been awarded?
What happens if you don’t use all the funds? Do you just give them back? What
happens if you run out? (I assume you are obligated to return the uses funds or
finish the build using your own capital)
Can usda/caf funding generally be used to purchase equipment (eg vibratory
plow, bucket truck) or only the infrastructure? (Eg fiber)?
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Trey Scarborough
VP Engineering
3DS Communications LLC
p:9729741539
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