12 2 STA T . 11 9 9 PUBLIC LA W 11 0– 2 34—M A Y 22 , 200 8‘ ‘ SEC.318 . BONDI N GR E QU IRE M EN T S. ‘ ‘ TheS e cr e ta r ys ha l lre vi e w the bond in g re qu ire m ents f or all p rograms administered by the R ural U tilities Service under this A ct to ensure that bonds are not required if — ‘‘ (1) the interests of the Secretary are adequately protected by product warranties
or ‘‘( 2 ) the costs or conditions associated with a bond e x ceed the benefit of the bond .’ ’. SEC. 6 11 0 . A CCESS TO BROADBAND TE L ECOMMUNICATIONS SER V ICES IN RURAL AREAS. (a) INGE NE RAL .—Section 60 1 of the Rural E lectrification Act of1 93 6( 7 U.S. C .9 5 0bb) is amended to read as follows
‘‘SEC. 601. ACCESS TO BROADBAND TELECOMMUNICATIONS SERVICES IN RURAL AREAS. ‘‘(a) PU R POS E.—The purpose of this section is to provide loans and loan guarantees to provide funds for the costs of the construc - tion , improvement, and acquisition of facilities and equipment for broadband service in rural areas. ‘‘(b) D E FI NI T IONS.—In this section: ‘‘(1) B ROA DB AND SER V I C E.—The term ‘broadband service’ means any technology identified by the Secretary as having the capacity to transmit data to enable a subscriber to the service to originate and receive high-quality voice, data, graphics, and video. ‘‘(2) INCU M BENT SERVICE PROVIDER.—The term ‘incumbent service provider’, with respect to an application submitted under this section, means an entity that, as of the date of submission of the application, is providing broadband service to not less than 5 percent of the households in the service territory pro- posed in the application. ‘‘(3) RURAL AREA.— ‘‘(A) IN G ENERAL.—The term ‘rural area’ means any area other than— ‘‘(i) an area described in clause (i) or (ii) of section 3 4 3(a)(13)(A) of the Consolidated F arm and Rural Development Act (7 U.S.C. 1991(a)(13)(A)); and ‘‘(ii) a city, town, or incorporated area that has a population of greater than 20,000 inhabitants. ‘‘(B) URBAN AREA GRO W T H .—The Secretary may, by regulation only, consider an area described in section 343(a)(13)(F)(i)(I) of that Act to not be a rural area for purposes of this section. ‘‘(c) L OANS AND LOAN GUARANTEES.— ‘‘(1) IN GENERAL.—The Secretary shall ma k e or guarantee loans to eligible entities described in subsection (d) to provide funds for the construction, improvement, or acquisition of facili- ties and equipment for the provision of broadband service in rural areas. ‘‘(2) PRIORIT Y .—In making or guaranteeing loans under paragraph (1), the Secretary shall give the highest priority to applicants that offer to provide broadband service to the greatest proportion of households that, prior to the provision of the broadband service, had no incumbent service provider. ‘‘(d) ELIGIBILITY.— ‘‘(1) ELIGIBLE ENTITIES.— Loans.Revi e w . 7USC940h .
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