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Thursday, April 23, 2009

Here come the funds

And we're off! USAC has announced that they will send out the first wave of 2009 Funding Commitment Decision Letters on April 28. Excellent! It's not a huge wave, but a respectable 6,931 letters approving $134 million. USAC is very proud of how early the wave is out, and it is great, but for me the key is how many applicants can be approved by early June. Those applicants will be able to get their 486 approved before the start of the funding year, so they can get discounts right away. This is especially true for Basic Maintenance (BMIC) FRNs, as applicants often have to make a decision on service agreements by July 1.

Alas, BMIC FRNs are Priority Two, and those FRNs won't be funded until the FCC does its annual rollover of unused funds. This year's demand for Priority One is just over $2 billion. The Priority Two demand from 90% applicants is just over $800 million. That's $2.8 billion and the fund is only $2.25 billion without carryovers.

The carryover is generally approved in the last half of June. The rule is that the carryover is to take place in the second quarter, and the FCC chooses to wait for the end of the quarter. Too bad they don't choose to do the carryover in April. Even better, the FCC should set the Priority Two denial threshold before the filing window opens.

But it's good to have at least some FRNs come out in April. So thanks, USAC!

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