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4422 Federal Register/Vol. 87, No. 18/Thursday, January 27, 2022/Rules and Regulations
<br /> Supplementary Information to the final Further,the final rule allows for III.Restrictions on Use
<br /> rule also modifies the interim final modernization of cybersecurity for While recipients have considerable
<br /> rule's requirements around duplication existing and new broadband flexibility to use funds to address the
<br /> of resources. Since recipients must infrastructure as an eligible use under diverse needs of their communities,
<br /> ensure that the objective of the sections 602(c)(1)(D) and 603(c)(1)(D) as some restrictions on use of funds apply.
<br /> broadband projects is to serve locations such investments are necessary for the pp y'
<br /> The ARPA includes two statutory
<br /> with an identified need for additional reliability and resiliency of broadband
<br /> provisions that further define the
<br /> broadband investment,the final rule infrastructure.345Recipients may boundaries of the statute's eligible uses.
<br /> provides that,to the extent recipients provide necessary investments in g
<br /> are consideringdeployingbroadband to cybersecurity, including modernization First, section 602(c)(2)(A) of the Social
<br /> Security Act provides that states and
<br /> locations where there are existing of hardware and software, for existing territories may not"use the funds . . .
<br /> enforceable federal or state funding and new broadband infrastructure to either directly or indirectly offset a
<br /> commitments for reliable service at regardless of their speed delivery reduction in. . .net tax revenue . . .
<br /> speeds of at least 100 Mbps download standards. The final rule maintains the resulting from a change in law,
<br /> u speed and 20 Mb s loads speed, interim final rules provision that allows
<br /> p p p p for broader modernization of regulation, or administrative
<br /> recipients must ensure that SLFRF interpretation during the covered period
<br /> funds are designed to address an cybersecurity, including hardware, that reduces any tax. . . or delays the
<br /> identified need for additional software,and protection of critical imposition of any tax or tax increase."
<br /> broadband investment that is not met by infrastructure as an eligible provision of Second,sections 602(c)(2)(B)and
<br /> existing federal or state funding government services,to the extent of 603(c)(2) prohibit all recipients, except
<br /> commitments. Recipients must also revenue loss due to the pandemic, Tribal governments,from using funds
<br /> ensure that SLFRF funds will not be under sections 602(c)(1)(C)and for deposit into any pension fund.These
<br /> used for costs that will be reimbursed by 603(c)(1)(C). restrictions support use of funds only
<br /> the other federal or state funding Use of Funds To Meet Non-Federal for the congressionally permitted
<br /> streams. Match Under the Infrastructure purposes described in the Eligible Uses
<br /> Cybersecurity Investment and Jobs Act section by providing a backstop against
<br /> The Infrastructure Investment and the use of funds for purposes outside of
<br /> Public Comment:Several commenters Jobs Act specifies that, except as the eligible use categories provided for
<br /> expressed concern about the otherwise provided,an entity using in the statute.
<br /> cybersecurity of new broadband projects funding under section 60102 of the law In addition to the restrictions on use
<br /> funded with SLFRF funds and urged for broadband deployment"shall of funds provided for in the ARPA
<br /> Treasury to prohibit recipients from provide, or require a subgrantee to statute,the interim final rule noted that
<br /> utilizing SLFRF funds to procure provide,a contribution, derived from several uses of funds would be
<br /> equipment from certain providers from non-Federal funds (or funds from a ineligible under any eligible use
<br /> the People's Republic of China that may Federal regional commission or category, including as a response to the
<br /> pose a national security risk.These authority) . . . of not less than 25 public health and negative economic
<br /> commenters pointed out that the 2019 percent of project costs."346 It further impacts of the pandemic or as a
<br /> National Defense Authorization Act states that the matching contribution "government service"under the
<br /> (NDAA) and the FCC's Universal may include funds provided to an revenue loss eligible use category.
<br /> Service Fund have similar prohibitions. eligible entity or subgrantee under the Specifically,use of funds for debt
<br /> Further, several commenters requested American Rescue Plan Act for the service,to replenish financial reserves,
<br /> that Treasury explicitly include purpose of deployment of broadband or to satisfy an obligation arising from
<br /> cybersecurity costs as an eligible use for service,which includes funds provided a judicial settlement or judgment were
<br /> broadband infrastructure investment under the SLFRF program. ineligible uses of funds under the
<br /> given the growing threat of cyber-attacks SLFRF and the program established eligible use categories for public health
<br /> and cyber-intrusions into the nation's under section 60102 of the and negative economic impacts and
<br /> infrastructure. Infrastructure Investment and Jobs Act revenue loss. These restrictions apply to
<br /> Treasury Response:Treasury are separate programs with separate all recipients.
<br /> highlights that investments in requirements. While section 60102 Recipients should note that
<br /> broadband infrastructure must be allows states and other eligible entities restrictions on use of funds for debt
<br /> carried out in ways that comply with to use SLFRF funds as the source of service,to replenish financial reserves,
<br /> applicable federal laws,including the matching funds for broadband or to satisfy an obligation arising from
<br /> 2019 NDAA.Among other requirements deployment,the requirements of the a judicial settlement or judgment apply
<br /> contained in 2 CFR part 200, 2 CFR SLFRF program still apply.As such, to all eligible use categories,not just the
<br /> 200.216 implements certain provisions recipients that use SLFRF funds to meet eligible use categories in which they
<br /> of the NDAA and contains prohibitions the section 60102 matching requirement were discussed in the interim final rule.
<br /> on the use of federal financial assistance will continue to be subject to the Recipients are also subject to other
<br /> to procure or obtain certain requirements of the SLFRF program. restrictions on use of funds in the
<br /> telecommunications and video ARPA,the Award Terms and
<br /> surveillance services or equipment 345 For more on the importance of cybersecurity Conditions, and other federal laws. As
<br /> to the reliability and resiliency of broadband
<br /> provided or produced by designated discussed further below,uses of funds
<br /> networks,see:Federal Communications
<br /> entities,including certain entities Commission,https://docs.fcc.gov/public/ may not conflict with the overall
<br /> owned or controlled by the Peoples attachments/FCC-10-63A1.doc;Brookings Institute, statutory purpose of the ARPA to reduce
<br /> Republic of China. In addition, 2 CFR Protecting the Cybersecurity of America's Networks the spread of COVID-19.Per the Award
<br /> 200.471 provides that certain (February 11,2021),https://www.brookings.edu/ Terms and Conditions,recipients must
<br /> blog/techtank/2021/02/11/protecting-the-
<br /> telecommunications and video cybersecurity-of-americas-networks/. adopt and abide by policies to prevent
<br /> surveillance costs associated with 2 CFR 346 See Infrastructure Investment and Jobs Act, conflicts of interest. Finally,recipients
<br /> 200.216 are unallowable. Public Law 117-58(2021). are reminded that other federal laws
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