New Equipment Contract for Telecommunications and Broadband Borrowers, 8327-8337 [2014-01340]

Agencies

• DEPARTMENT OF AGRICULTURE
• Rural Utilities Service

[Federal Register Volume 79, Number 29 (Wednesday, February 12, 2014)]
[Proposed Rules]
[Pages 8327-8337]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-01340]


========================================================================
Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

========================================================================


Federal Register / Vol. 79, No. 29 / Wednesday, February 12, 2014 / 
Proposed Rules

[[Page 8327]]



DEPARTMENT OF AGRICULTURE

Rural Utilities Service

7 CFR Parts 1753 and 1755

RIN 0572-AC29


New Equipment Contract for Telecommunications and Broadband 
Borrowers

AGENCY: Rural Utilities Service, USDA.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Rural Utilities Service (RUS), a Rural Development agency 
of the United States Department of Agriculture (USDA), hereinafter 
referred to as RUS or the Agency, is proposing to amend the 
telecommunications standards and specifications for material, equipment 
and construction regulations by streamlining and replacing Equipment 
Specific Contracts, RUS Forms 397, 398, 525, 545, and the associated 
documents (Forms 231, 396, 396a, 397b, 397c, 397d, 397f, 397g, 397h, 
517, 525a, 744, 752a, 754, and addenda) with a new Equipment Contract, 
RUS Form 395 and the associated close-out documents (Forms 395a, 395b, 
395c and 395d). The proposed rule includes conforming changes to 
reflect the use of the new contract, administrative updates, and 
addresses the discontinuance of the requirement for RUS borrowers to 
use the Informational Publication (I.P.) 344-2, ``List of Material 
Acceptable for Use on Telecommunications Systems of RUS Borrowers.'' 
The intended effect is to streamline the contractual process for RUS 
borrowers and expedite the approval process of equipment during the 
development of RUS funded construction projects.

DATE: Comments, electronic and/or paper, must be submitted on or before 
April 14, 2014. Late comments will not be considered.

ADDRESSES: Submit comments by either of the following methods:
     Federal Rulemaking Portal at https://www.regulations.gov. 
Follow instructions for submitting comments.
     Postal Mail/Commercial Delivery: Please send your comments 
addressed to Michele L. Brooks, Director, Program Development and 
Regulatory Analysis, Rural Utilities Service, U.S. Department of 
Agriculture, 1400 Independence Avenue, STOP 1522, Room 5162, 
Washington, DC 20250-1522.
    Additional information about Rural Development and its programs is 
available on the Internet at https://www.rurdev.usda.gov/.

FOR FURTHER INFORMATION CONTACT: Norberto Esteves, Chief, Technical 
Staff Branch, Rural Utilities Service, Telecommunications Program, U.S. 
Department of Agriculture, STOP 1550, 1400 Independence Ave. SW., 
Washington, DC 20250-1550, Telephone number: (202) 720-0699.

SUPPLEMENTARY INFORMATION: 

Executive Order 12866

    This proposed rule has been determined to be not significant for 
the purposes of Executive Order 12866, Regulatory Planning and Review, 
and therefore has not been reviewed by the Office of Management and 
Budget (OMB).

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. The Agency has determined that this proposed rule 
meets the applicable standards provided in section 3 of the Executive 
Order. In addition, all state and local laws and regulations that are 
in conflict with this rule will be preempted. No retroactive effect 
will be given to this rule and, in accordance with section 212(e) of 
the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 
6912(e)), administrative appeal procedures must be exhausted before an 
action against the Department or its agencies may be initiated.

Executive Order 12372

    This proposed rule is not subject to the requirements of Executive 
Order 12372, ``Intergovernmental Review'', as implemented under USDA's 
regulations at 7 CFR part 3015.

Regulatory Flexibility Act Certification

    RUS has determined that this proposed rule will not have a 
significant economic impact on a substantial number of small entities, 
as defined in the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). 
RUS provides loans to borrowers at interest rates and on terms that are 
more favorable than those generally available from the private sector. 
RUS borrowers, as a result of obtaining federal financing, receive 
economic benefits that exceed any direct economic costs associated with 
complying with RUS regulations and requirements.

Environmental Impact Statement

    This rule has been examined under Agency environmental regulations 
at 7 CFR part 1794. The Administrator has determined that this action 
is not a major action Federal action significantly affecting the 
environment. Therefore, in accordance with the National Environmental 
Policy Act of 1969 (42 U.S.C. 4321 et seq.), an Environmental Impact 
Statement or Assessment is not required.

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance (CFDA) number assigned 
to this program is 10.851. The Catalog is available on the Internet at 
https://www.cfda.gov.

Unfunded Mandates

    This proposed rule contains no Federal mandates (under the 
regulatory provisions of Title II of the Unfunded Mandates Reform Act 
of 1995) for State, local, and tribal governments or the private 
sector. Therefore, this proposed rule is not subject to the 
requirements of Sec. Sec.  202 and 205 of the Unfunded Mandates Reform 
Act of 1995.

E-Government Act Compliance

    RUS is committed to the E-Government Act, which requires Government 
agencies in general to provide the public the option of submitting 
information or transacting business electronically to the maximum 
extent possible.

Executive Order 13132, Federalism

    The policies contained in this proposed rule do not have any 
substantial direct effect on states, on the relationship between the 
national government and the states, or on the distribution of power and 
responsibilities among the various levels of government. Nor does this

[[Page 8328]]

proposed rule impose substantial direct compliance costs on state and 
local governments. Therefore, consultation with the states is not 
required.

Executive Order 13175, Consultation and Coordination With Indian Tribal 
Governments

    Executive Order 13175 imposes requirements on Rural Development in 
the development of regulatory policies that have tribal implications or 
preempt tribal laws. Rural Development has determined that this 
proposed rule does not have a substantial direct effect on one or more 
Indian tribes(s) or on either the relationship or the distribution of 
powers and responsibilities between the Federal Government and Indian 
tribes. Thus, this rule is not subject to the requirements of Executive 
Order 13175. If a tribe determines that this rule has implications of 
which Rural Development is not aware and would like to engage in 
consultation with Rural Development on this rule, please contact Rural 
Development's Native American Coordinator at (720) 544-2911 or 
AIAN@wdc.usda.gov.

Information Collection and Recordkeeping Requirements

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
chapter 35), RUS invites comments on this information collection for 
which RUS intends to request approval from the Office of Management and 
Budget (OMB).
    Comments on this notice must be received by April 14, 2014.
    Comments are invited on (a) whether the collection of information 
is necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility; (b) the 
accuracy of the agency's estimate of burden including the validity of 
the methodology and assumption used; (c) ways to enhance the quality, 
utility and clarity of the information to be collected; and (d) ways to 
minimize the burden of the collection of information on those who are 
to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology.
    Comments may be sent to Michele Brooks, Director, Program 
Development and Regulatory Analysis, Rural Utilities Service, U.S. 
Department of Agriculture, 1400 Independence Ave. SW., Stop 1522, Room 
5159 South Building, Washington, DC 20250-1522, Fax: (202) 720-8435.
    Title: Form 395, Equipment Contract & Associated Forms
    OMB Control Number: 0572-NEW.
    Type of Request: Approval of a new collection.
    Abstract: In order to ensure that RUS loans are adequately secured 
as required by the Rural Electrification Act of 1936 (RE Act) (7 U.S.C. 
901 et seq.), the Agency has established certain standardized forms for 
materials, equipment and construction of electric and 
telecommunications systems. The use of standard forms, construction 
contracts, and procurement procedures helps to ensure that appropriate 
standards and specifications are maintained by the borrower, the 
Agency's loan security is not adversely affected, and the loan and loan 
guarantee funds are used effectively and for the intended purposes.
    The new Equipment Contract, RUS Form 395 and the associated close-
out documents (Forms 395a, 395b, 395c and 395d) will replace the 
current Equipment Specific Contracts, RUS Forms 397, 398, 525, 545, and 
the associated documents (Forms 231, 396, 396a, 397b, 397c, 397d, 397f, 
397g, 397h, 517, 525a, 744, 752a, 754, and addenda). Contract terms and 
obligations in the RUS's new Equipment Contract, RUS Form 395, reflects 
present RUS and private sector practices, as well as changes in 
technology, services and equipment. The new RUS forms will streamline 
the contractual process for the RUS Borrower and expedite the approval 
process of equipment during the duration of the project.
    The specific purposes and uses of the proposed new contract forms 
are as follows:

(1) New Contract Form

     RUS Form 395, Equipment Contract.
    This form will be used for equipment purchases.

(2) New Associated Forms with RUS Form 395

     RUS Form 395a, Certificate of Completion (Equipment 
Contract Including Installation).
    This form will be used for the closeout of RUS Form 395 when the 
contract includes installation.
     RUS Form 395b, Certificate of Completion (Equipment 
Contract Not Including Installation).
    This form will be used to amend contracts except for distribution 
line construction contracts.
     RUS Form 395c, Certificate of Contractor and Indemnity 
Agreement.
    This form will be used in the closeout of RUS Form 395.
     RUS Form 395d, Results of Acceptance Tests.
    This is a suggestive form to be used to report results of 
acceptance testing of equipment for purposes of closing out the 
contract.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average .25 hours per response.
    Estimated Number of Respondents: 284.
    Estimated Number of Total Annual Responses per Respondents: 284.
    Estimated Total Annual Burden on Respondents: 71 hours.
    Copies of this information collection can be obtained from Michele 
L. Brooks, Director, Program Development and Regulatory Analysis, at 
(202) 690-1078.
    All responses to this information collection and recordkeeping 
notice will be summarized and included in the request for OMB approval. 
All comments will also become a matter of public record.

Background

    Rural Development is a mission area within the U.S. Department of 
Agriculture comprising the Rural Housing Service, Rural Business/
Cooperative Service, and Rural Utilities Service. Rural Development's 
mission is to increase economic opportunity and improve the quality of 
life for all rural Americans. Rural Development meets its mission by 
providing loans, loan guarantees, grants and technical assistance 
through more than 40 programs aimed at creating and improving housing, 
businesses and infrastructure throughout rural America.
    The Rural Utilities Service (RUS) loan, loan guarantee and grant 
programs act as a catalyst for economic and community development. By 
financing improvements to rural electric, water and waste, and telecom 
and broadband infrastructure, RUS also plays a big role in improving 
other measures of quality of life in rural America, including public 
health and safety, environmental protection, conservation and cultural 
and historic preservation.
    The purpose of this undertaking is to improve customer service to 
the Agency's rural borrowers. Divestiture, competition, legislation and 
regulations have changed business practices in the telecommunications 
industry. Over the past three years, RUS has undertaken a comprehensive 
review of its Telecommunications Program contracts. Traditional 
telecommunications borrowers, as well as broadband borrowers, benefit 
from the new RUS Form 395 because most of the revisions are a result of 
the changes the telecommunications industry has experienced as it has 
transitioned from

[[Page 8329]]

narrowband to broadband. The new RUS Form 395 can assist both types of 
borrowers with the purchase of equipment specifically designed to meet 
or exceed a typical narrowband or broadband system.
    In order to continue to facilitate the programmatic interest of the 
Rural Electrification Act of 1936 (the ``RE Act''), as amended (7 
U.S.C. 901 et seq.), that loans and loans guaranteed by RUS are 
adequately secured, RUS has established certain standardized forms for 
materials, equipment and construction of electric and 
telecommunications systems. The use of standard forms, construction 
contracts, and procurement procedures helps to assure that appropriate 
standards and specifications are maintained by the borrower in order 
not to adversely affect RUS's loan security and that loan and loan 
guarantee funds are effectively used for intended purpose(s).
    Contract terms and obligations in the new RUS Form 395, Equipment 
Contract reflects present RUS and private sector practices, as well as 
changes in technology, services and equipment. The new RUS Form 395, 
Equipment Contract and associated close-out documents (Forms 395a, 
395b, 395c and 395d) will replace the current Equipment Specific 
Contracts, RUS Forms 397, 398, 525, 545, and the associated documents 
(Forms 231, 396, 396a, 397b, 397c, 397d, 397f, 397g, 397h, 517, 525a, 
744, 752a, 754, and addenda). The new RUS forms will streamline the 
contracting process for the RUS Borrower and expedite the approval 
process of equipment during the duration of the project.
    This proposed rule will also remove references to Informational 
Publication (I.P.) 344-2, ``List of Material Acceptable for Use on 
Telecommunications Systems of RUS Borrowers'' (List of Materials) from 
the Telecommunications Program regulations. Historically, the List of 
Materials has been a useful tool in assuring product quality and 
reliability of equipment used in the development of RUS funded 
construction projects. One method for a product not having field-
deployment experience in a commercial setting to be placed on the list 
was a ``field trial''. The ``field trials'' process, as well as 
maintaining the List of Materials was a labor intensive product-by-
product review by Agency staff. Since the start of the Agency's 
Telecommunications Program in 1949, technology has changed 
dramatically. The telecommunications equipment supply sector is very 
different, and far more complex and diverse, today than it was over 60 
years ago. Product life cycles have accelerated, innovations abound and 
new suppliers have entered the market. The Agency has undertaken a 
fundamentally new approach to advancing state-of-the-art 
telecommunications technologies, while maintaining a consistent 
commitment to high quality rural service and the efficient use of 
taxpayer dollars. In this new technology environment, RUS must operate 
efficiently and effectively under current budgetary constraints. 
Maintaining the List of Materials, which includes a product-by-product 
review, simply cannot be sustained under our current budget and with 
our limited staff. RUS, therefore, has discontinued accepting 
applications as well as publishing the List of Materials as of May 23, 
2011. Field trials are no longer needed and have been discontinued as 
well. However, in order to protect RUS's loan security and compliance 
with continuing Buy America statutory mandates, the Agency has 
transitioned from a listing process to an approach which ensures that 
construction financed by RUS meets applicable industry standards. This 
new approach is incorporated into the review of individual projects and 
the approval of loan advances. The intended effect is to streamline the 
contractual process for RUS borrowers and expedite the approval process 
of equipment during the development of RUS funded construction 
projects.

List of Subjects

7 CFR Part 1753

    Communications equipment; Loan programs--Telecommunications; 
Reporting and recordkeeping requirements; Rural areas; and Telephone.

7 CFR Part 1755

    Loan programs--Telecommunications; Reporting and recordkeeping 
requirements; Rural areas; and Telecommunications.
    For the reasons set forth in the preamble, the Rural Utilities 
Service proposes to amend Chapter XVII of Title 7 of the Code of 
Federal Regulations by proposing to amend parts 1753 and 1755.

PART 1753--TELECOMMUNICATIONS SYSTEM CONSTRUCTION POLICIES AND 
PROCEDURES

0
1. The authority citation for part 1753 continues to read as follows:

    Authority: 5 U.S.C. 501, 7 U.S.C. 901 et seq.

Subpart A--General

0
2. In Sec.  1753.2, remove the definition of the RTB.
0
3. Amend Sec.  1753.6 by revising paragraph (a) to read as follows:


Sec.  1753.6  Standards, specifications, and general requirements.

    (a) Materials, equipment, and construction financed with loan funds 
must meet the standards and specifications established by RUS 7 CFR 
part 1755 which lists the RUS Bulletins containing the standards and 
specifications for telephone facilities.
* * * * *
0
4. Amend Sec.  1753.7 by:
0
a. Revising paragraph (c),
0
b. Removing paragraph (f)(4).
    The revision reads as follows:


Sec.  1753.7  Plans and specifications (P&S).

* * * * *
    (c) The appropriate standards and specifications listed in 7 CFR 
part 1755 shall be included in the P&S. When RUS has not prepared 
standards and specifications, the borrower shall use all appropriate 
project specific engineering requirements and specifications prepared 
by the borrower's engineer. The specifications prepared by the 
borrower's engineer and based on appropriate project specific 
engineering requirements shall be subject to review and approval by RUS 
for all major construction, including major projects which would be 
exempted from RUS approval under paragraph (e) of this section.
* * * * *
0
5. Amend Sec.  1753.9 by revising paragraphs (a) and (c) to read as 
follows:


Sec.  1753.9  Subcontracts.

    (a) RUS construction contract Forms 257, 395, and 515, contain 
provisions for subcontracting. Reference should be made to the 
individual contracts for the amounts and conditions under which a 
contractor may subcontract work under the contract.
* * * * *
    (c) As stated in contract Forms 257, 395, and 515, the contractor 
shall bear full responsibility for the acts and omissions of the 
subcontractor and is not relieved of any obligations to the borrower 
and to the Government under the contract.
* * * * *

Subpart B--Engineering Services

0
6. Amend Sec.  1753.18 by revising paragraph (c) to read as follows:

[[Page 8330]]

Sec.  1753.18  Engineer and architect contract closeout certifications.

* * * * *
    (c) A statement that construction used was in accordance with 
specifications published by RUS covering the construction which were in 
effect when the contract was executed, or in the absence of such 
specifications, that it meets other applicable specifications and 
standards and that it meets all applicable national and local code 
requirements as to strength and safety.
* * * * *

Subpart E--Purchase and Installation of Central Office Equipment

0
7. Amend Sec.  1753.36 by revising paragraphs (b), (c), (e), and (g) to 
read as follows:


Sec.  1753.36  General.

* * * * *
    (b) Terms used in this subpart are defined in Sec.  1753.2 and RUS 
Contract Form 395.
    (c) Borrowers shall use RUS Contract Form 395, Equipment Contract 
and associated RUS Form 395a, Equipment Contract Certificate of 
Completion (Including Installation), when the firm supplying the 
equipment will install it and RUS Contract Form 395, Equipment Contract 
and associated RUS Form 395b, Equipment Contract Certificate of 
Completion (Not Including Installation) when the supplier of the 
equipment will not be installing it. In either case the appropriate 
specifications shall be included in the contract.
* * * * *
    (e) The borrower shall take sealed competitive bids for all central 
office equipment to be purchased under RUS Contract Form 395 using the 
procedure set forth in Sec. 1753.38(a), unless RUS approval to 
negotiate is obtained.
* * * * *
    (g) Materials and equipment must meet the standards and general 
specifications approved by RUS.
* * * * *
0
8. Amend Sec.  1753.37 by revising paragraphs (a) and (b) to read as 
follows:


Sec.  1753.37  Plans and specifications (P&S).

    (a) General. (1) Prior to the preparation of P&S, the borrower 
shall review with the GFR the current and future requirements for 
central office equipment.
    (2) The P&S shall specify the delivery and completion time required 
for each exchange.
    (3) P&S for equipment to be provided under a Form 395 contract 
without installation shall require the supplier to provide specific 
installation information and a detailed bonding and grounding plan to 
be utilized by the engineer, borrower, and others responsible for the 
installation of the equipment.
    (b) Preparation of P&S. The P&S shall include RUS Contract Form 
395, Notice and Instructions to Bidders, specifications for the 
required equipment for each exchange, provision for spare parts, and 
all other pertinent data needed by the bidder to complete its proposal.
* * * * *
0
9. Amend Sec.  1753.38 by:
0
a. Revising paragraphs (a)(1)(i), (a)(1)(iii), (a)(2)(i)(J), (a)(2)(v)
0
b. Revising (b)(10),
0
c. Removing paragraph (c) and redesignating paragraphs (d), (e), and 
(f), paragraph (d) as newly designated paragraphs (c), paragraph (e) as 
newly designated paragraph (d) and (f) as newly designated paragraph 
(e); and
0
d. Revising newly redesignated paragraphs (d)(3) and (d)(5).
    The revisions read as follows:


Sec.  1753.38  Procurement procedures.

    (a) * * *
    (1) * * *
    (i) After RUS approval of the specifications and equipment 
requirements (required only for projects expected to exceed $500,000 or 
25% of the loan, whichever is less), the borrower shall send ``Notice 
and Instructions to Bidders'' to suppliers with central office 
equipment.
* * * * *
    (iii) RUS Contract Form 395 shall be used, except that the 
``Notice'' shall state that prior to the bid opening a technical 
session will be conducted with each supplier to resolve any questions 
related to the technical proposal submitted by the supplier. The 
suppliers' technical proposals should be requested for presentation 30 
days in advance of the bid opening to enable sufficient time to make 
the technical evaluation.
* * * * *
    (2) * * *
    (i) * * *
    (J) Some types of equipment contain software. Equipment Contract 
(RUS Form 395) indicates whether the equipment contains software and 
whether the software contract stipulations are applicable.
* * * * *
    (v) After evaluation of the technical proposals and RUS approval of 
the changes to P&S (required only for projects that are expected to 
exceed $500,000 or 25% of the loan, whichever is less), sealed bids 
shall be solicited from only those bidders whose technical proposals 
meet P&S requirements. When fewer than three bidders are adjudged 
qualified by the borrower to bid, RUS approval must be obtained to 
proceed. Generally, RUS will grant such approval only if the borrower 
can demonstrate to the satisfaction of RUS that a good faith effort was 
made to obtain at least three competitive bids.
* * * * *
    (b) * * *
    (10) Installation of the central office equipment and materials 
provided under RUS Contract Form 395 may be made in accordance with 
subpart I, if applicable, or by an approved Force Account Proposal 
(FAP).
* * * * *
    (d) * * *
    (3) If RUS approval was required by paragraph (d)(2) of this 
section, upon RUS approval the purchase may be made using RUS Contract 
Form 395, or when applicable, the procedures contained in subpart I of 
this part.
* * * * *
    (5) Installation of the central office equipment and materials 
procured by RUS Contract Form 395 without installation may be made in 
accordance with subpart I, if applicable, or by an approved FAP.
* * * * *
0
10. Revise Sec.  1753.39 to read as follows:


Sec.  1753.39  Closeout documents.

    Closeout of RUS Contract Form 395 Equipment Contract (including or 
not including installation) shall be conducted as follows:
    (a) Contract amendments. Amendments that must be submitted to RUS 
for approval, as required by 7 CFR 1753.11, shall be submitted 
promptly. All other amendments may be submitted to RUS with the 
engineer's contract closeout certification.
    (b) Acceptance tests. The borrower will perform acceptance tests as 
part of the partial closeout and final closeout of RUS Contract Form 
395 that will demonstrate compliance with the requirements as specified 
by the borrower's engineer in the Performance Requirements. Other tests 
demonstrating compliance will be acceptable.
    (c) Grounding system audit. A grounding system audit shall be 
performed and found acceptable for equipment provided under RUS 
Contract Form 395, Equipment Contract (including or not including 
installation), prior to placing a central office or remote switching 
terminal into full service operation. The audits are to be conducted in 
accordance with the

[[Page 8331]]

requirements specified by the borrower's engineer in the Performance 
Requirements. The audits shall be performed by the contractor and 
borrower when using the Form 395 with equipment installation and by the 
borrower when using the Form 395 without equipment installation.
    (d) Partial Closeout Procedure. Under conditions set forth in RUS 
Contract Form 395, a contractor may, when approved by the borrower, 
receive payment in full for central offices and their respective 
associated remote switching terminals upon completion of the 
installation without awaiting completion of the project. The contractor 
is to receive such payment, according to procedures contained in the 
applicable sections of RUS Contract Form 395. In addition to complying 
with the appropriate partial closeout procedure contained in RUS 
Contract Form 395, the borrower shall:
    (1) Obtain from the engineer a certification of partial closeout; 
and
    (2) Submit one copy of the summary to RUS with an FRS.
    (e) Final contract closeout procedure. The documents required for 
the final closeout of the equipment contract, RUS Contract Form 395 
with or without installation, are listed in the following table, which 
also indicates the number of copies and their distribution. The 
procedure to be followed is as follows:

                        Documents REQUIRED to Close Out RUS Form 395--Equipment Contracts
----------------------------------------------------------------------------------------------------------------
                                            Number of copies prepared by                 Distribution
 RUS form No.         Description      -------------------------------------------------------------------------
                                              Seller            Engineer            Buyer            Seller
----------------------------------------------------------------------------------------------------------------
213...........  Certificate (Buy        1................  .................  1...............  ................
                 American).
238...........  Construction or                            3 sent to RUS....  1 from RUS......  1 from RUS.
                 Equipment Contract
                 Amendment (If not
                 previously submitted,
                 send to RUS for
                 approval).
395a..........  Certificate of          .................  2................  1...............  1.
                 Completion for
                 Equipment Contract
                 (Including
                 Installation).
395b..........  Certificate of          .................  2................  1...............  1.
                 Completion for
                 Equipment Contract
                 (Not Including
                 Installation).
395c..........  Certificate of          1................  .................  1...............  ................
                 Contractor and
                 Indemnity Agreement
                 (Use only for
                 installation
                 contracts).
None..........  Report in writing,      .................  1................  1...............  ................
                 including all
                 measurements, any
                 acceptance test
                 report and other
                 information required
                 under Part II of the
                 applicable
                 specifications (Form
                 395d may be used).
None..........  Set of maintenance      1................  .................  1...............  ................
                 recommendations for
                 all equipment
                 furnished under the
                 contract.
----------------------------------------------------------------------------------------------------------------

    (f) Once RUS approval has been obtained for any required 
amendments, the borrower shall obtain certifications from the engineer 
that the project and all required documentation are satisfactory and 
complete. The requirements for the final contract certification are 
contained in Sec.  1753.18.
    (g) Once these certifications have been received, final payment 
shall be made according to the payment terms of the contract. Copies of 
the certifications shall be submitted with the FRS, requesting the 
remaining funds on the contract.

Subpart F--Outside Plant Major Construction by Contract

0
11. Amend Sec.  1753.47 by revising paragraphs (a)(2) and (b)(5) to 
read as follows:


Sec.  1753.47  Plans and specifications (P&S).

    (a) * * *
    (2) The standard RUS specifications required for construction of 
outside plant facilities are:
    (i) RUS Form 515a (Bulletin 1753F-150)--Specifications and Drawings 
for Construction of Direct Buried Plant.
    (ii) RUS Form 515b (Bulletin 1753F-151)--Specification and Drawings 
for Construction of Underground Plant.
    (iii) RUS Form 515c (Bulletin 1753F -152)--Specifications and 
Drawings for Construction of Aerial Plant.
    (iv) RUS Form 515d (Bulletin 1753F -153)--Specification and 
Drawings for Service Installation at Customer Access Locations.
    (b) * * *
    (5) RUS Contract Form 787, ``Supplement A to Construction Contract, 
RUS Contract Form 515,'' when the borrower proposes to provide any 
materials to the contractor. The borrower shall not order materials for 
a contractor without RUS approval. In such cases the borrower must 
attach Form 787 and a ``List of Owner's Materials on Hand'' and/or a 
``List of Materials Ordered by Owner but Not Delivered'' to contract 
Form 515 (See Sec.  1753.48(f) of this part). Any materials furnished 
under Supplement A shall be in compliance with the RUS Buy American 
requirement unless special RUS approval has been received by the 
borrower to use non-domestic materials.
* * * * *

Subpart H--Purchase and Installation of Special Equipment

0
12. Revise Sec.  1753.66 to read as follows:


Sec.  1753.66  General.

    (a) This subpart implements and explains the provisions of the Loan 
Documents setting forth the requirements and the procedures to be 
followed by borrowers in purchasing and installing special equipment 
financed with loan funds.
    (b) Terms used in this subpart are defined in Sec.  1753.2 and RUS 
Form 395.
    (c) Borrowers must obtain RUS review and approval of the LD for 
their telephone systems. Applications of equipment not included in an 
approved LD must conform to the modernization plan as required by 7 CFR 
part 1751, subpart B, and must be submitted to RUS for review and 
approval.
    (d) RUS Form 395 and applicable specifications shall be used for 
the purchase of special equipment for major construction on a furnish-
and-install basis, as well as on a furnish-only basis.
    (e) The procedures provided in subpart I, if applicable, or a FAP 
approved by RUS may be used for the installation of special equipment 
purchased with a Form 395 contract not including installation.
    (f) For special equipment purchases for minor construction, the 
borrower may at its option use the Methods of Minor Construction 
procedures

[[Page 8332]]

contained in subpart I or the purchase procedures contained in this 
subpart H.
    (g) Some types of special equipment contain software. Equipment 
Contract (RUS Form 395) indicates whether the equipment contains 
software and whether the software contract stipulations are applicable.
0
13. Revise Sec.  1753.to reads as follows:


Sec.  1753.67  Contracts and specifications.

    (a) Equipment Contract, RUS Form 395 shall be used to purchase 
equipment on a furnish-and-install basis, as well as on a furnish-only 
basis.
    (b) The equipment specifications must accompany the equipment 
contract form and each specification consists of performance 
specifications, installation requirements (if applicable), and 
application engineering requirements.
0
14. Amend Sec.  1753.68:
0
a. In paragraph (a)(1)(iv) by removing the term ``Form 398 Contract'' 
and adding in its place ``Form 395 without installation'';
0
b. In paragraph (a)(8) by removing the term ``Form 397'' and adding in 
its place ``Form 395'';
0
c. By revising paragraph (a)(9);
0
d. In paragraph (d)(1) by removing the term ``Form 397'' and adding in 
its place ``Form 395 with installation'';
0
e. In paragraph (d)(2) by removing the term ``Form 398'' and adding in 
its place ``Form 395 without installation'' and redesignate paragraph 
(d)(2)(i) as (d)(2);
0
f. In paragraph (d)(3)(i) by removing the phrase ``special equipment 
contract'' and adding in its place the phrase ``equipment contract''
0
g. By revising the table in paragraph (d)(3)(i).
    The revisions read as follows:


Sec.  1753.68  Purchasing special equipment.

    (a)* * *
    (9) The specifications for the various applications of equipment is 
prepared by the RUS borrower's engineer and based on generally accepted 
engineering considerations and practices found in the 
Telecommunications Industry.
* * * * *

                        Documents Required to Close Out RUS Form 395--Equipment Contracts
----------------------------------------------------------------------------------------------------------------
                                            Number of copies prepared by                 Distribution
 RUS form No.         Description      -------------------------------------------------------------------------
                                              Seller            Engineer            Buyer            Seller
----------------------------------------------------------------------------------------------------------------
213...........  Certificate (Buy        1................  .................  1...............  ................
                 American).
238...........  Construction or         .................  3 sent to RUS....  1 sent to RUS...  1 from RUS.
                 Equipment Contract
                 Amendment (If not
                 previously submitted,
                 send to RUS for
                 approval).
395a..........  Certificate of          .................  2................  1...............  1.
                 Completion for
                 Equipment Contract
                 (Including
                 Installation).
395b..........  Certificate of          .................  2................  1...............  1.
                 Completion for
                 Equipment Contract
                 (Not Including
                 Installation).
395c..........  Certificate of          .................  .................  1...............  ................
                 Contractor and
                 Indemnity Agreement
                 (Use only for
                 installation
                 contracts).
None..........  Report in writing,      .................  1................  1...............  ................
                 including all
                 measurements, any
                 acceptance test
                 report and other
                 information required
                 under Part II of the
                 applicable
                 specifications. (Form
                 395d may be used.).
None..........  Set of maintenance      1................  .................  1...............  ................
                 recommendations for
                 all equipment
                 furnished under the
                 contract.
----------------------------------------------------------------------------------------------------------------

* * * * *

Subpart I--Minor Construction

0
15. Amend Sec.  1753.80 by:
0
a. In paragraph (b)(3) by removing the phrase ``special equipment'' and 
adding in its place ``equipment''; and
0
b. By revising paragraph (d)(2).
    The revision reads as follows:


Sec.  1753.80  Minor construction procedure.

* * * * *
    (d) * * *
    (2) All standard RUS procedures are followed, including the 
application of RUS construction practices (See Sec.  1753.6).
* * * * *

Subpart J--Construction Certification Program


Sec.  1753.93  [Amended]

0
16. In Sec.  1753.93, remove paragraphs (b)(7) and (b)(8) and 
redesignate paragraphs (b)(9) as newly designated paragraph (b)(7), 
(b)(10) as newly designated paragraph (b)(8), (b)(11) as newly 
designated paragraph (b)(9), (b12) as newly designated paragraph 
(b)10), and (b)(13) as newly designated paragraph (b)(11).


Sec.  1753.96  [Amended]

0
17. Amend the Certification Addendum in Sec.  1753.96 by removing the 
words ``or Rural Telephone Bank,'' from the second sentence.

PART 1755--TELECOMMUNICATIONS POLICIES ON SPECIFICATIONS, 
ACCEPTABLE MATERIALS, AND STANDARD CONTRACT FORMS

0
18. The authority citation for part 1755 continues to read as follows:

     Authority:  7 U.S.C. 901 et seq., 1921 et seq., 6941 et seq.


Sec.  1755.3  [Removed and Reserved]

0
19. Remove and reserve Sec.  1755.3
0
20. Amend Sec.  1755.30 by:
0
a. Revising paragraphs (c)(25) through (45); and
0
b. Removing paragraphs (c)(46) through paragraphs (56).
    The revisions read as follows:


Sec.  1755.30  List of telecommunications standard contract forms.

* * * * *
    (c) * * *
    (25) RUS Form 395, [EFFECTIVE DATE OF FINAL RULE], Equipment 
Contract.
    (26) RUS Form 395a, [EFFECTIVE DATE OF FINAL RULE], Equipment 
Contract Certificate of Completion (Including Installation).
    (27) RUS Form 395b, [EFFECTIVE DATE OF FINAL RULE], Equipment 
Contract Certificate of Completion (Not Including Installation).
    (28) RUS Form 395c, [EFFECTIVE DATE OF FINAL RULE], Certificate of 
Contractor and Indemnity Agreement.
    (29) RUS Form 395d, [EFFECTIVE DATE OF FINAL RULE], Results of 
Acceptance Tests.

[[Page 8333]]

    (30) RUS Form 506, issued 3-97, Statement of Engineering Fee--
Telecommunications.
    (31) RUS Form 515, issued September 17, 2001, Telecommunications 
Systems Construction Contract (Labor and Materials).
    (32) RUS Form 526, issued 8-66, Construction Contract Amendment.
    (33) RUS Form 527, issued 3-71, Statement of Construction, 
Telephone System ``Outside Plant''.
    (34) RUS Form 553, issued 5-67, Check List for Review of Plans and 
Specifications.
    (35) RUS Form 724, issued 10-63, Final Inventory, Telephone 
Construction Contract.
    (36) RUS Form 724a, issued 4-61, Final Inventory, Telephone 
Construction--Telephone Construction Contract (Labor and Materials), 
columns 1-8.
    (37) RUS Form 724b, issued 3-61, Final Inventory, Telephone 
Construction Contract (Labor and Materials), columns 9-14.
    (38) RUS Form 771, issued 10-75, Summary of Work Orders (Inspected 
by RUS Field Engineer).
    (39) RUS Form 771a, issued 10-75, Summary of Work Orders (Inspected 
by Licensed Engineer or Borrower's Staff Engineer).
    (40) RUS Form 773, issued 12-90, Miscellaneous Construction Work 
and Maintenance Services Contract.
    (41) RUS Form 787, issued 8-63, Supplement A to Construction 
Contract.
    (42) RUS Form 817, issued 6-60, Final Inventory, Telephone Force 
Account Construction.
    (43) RUS Form 817a, issued 6-60, Final Inventory, Telephone Force 
Account Construction, columns 1-8.
    (44) RUS Form 817b, issued 6-60, Final Inventory, Telephone Force 
Account Construction, Columns 9-14.
    (45) RUS Form 835, issued 3-66, Preloan Engineering Service 
Contract, Telephone System Design.


Sec.  1755.97  [Amended]

0
21. Amend Sec.  1755.97 by removing paragraphs (b)(1), (b)(2), (b)(4), 
(b)(6),and (b)(7) and redesignate (b)(3) as newly designated paragraph 
(b)(1), (b)(5) as newly designated paragraph (b)(2), (b)(8) as newly 
designated paragraph (b)(3), (b)(9) as newly designated paragraph 
(b)(4), (b)(10) as newly designated paragraph (b)(5), (b)(11) as newly 
designated paragraph (b)(6), (b)(12) as newly designated paragraph 
(b)(7), (b)(13) as newly designated paragraph (b)(8), (b)(14) as newly 
designated paragraph (b)(9), (b)(15) as newly designated paragraph 
(b)(10), (b)(16) as newly designated paragraph (b)(11), (b)(17) as 
newly designated paragraph (b)(12).
0
22. Amend Sec.  1755.200:
0
a. In paragraph (b)(1) by removing the word ``accepted'' and adding in 
its place ``compliant'';
0
b. In paragraph (c)(8)(i) by removing the word ``accepted'' and adding 
in its place ``compliant'';
0
c. In paragraph (c)(9) by removing the word ``acceptance'' and adding 
in its place ``compliance'';
0
d. In paragraph (c)(14)(i) and (c)(14)(ii) by removing the word 
``accepted'' and adding in its place ``compliant'';
0
e. In paragraph (d)(7) by removing the word ``accepted'' and adding in 
its place ``compliant'';
0
f. In paragraph (e)(6)(ii) by removing the word ``accepted'' and adding 
in its place ``compliant'';
0
g. In paragraphs (g)(2)(i) and (g)(2)(ii)(A) by removing the word 
``accepted'' and adding in its place ``compliant'',
0
h. By revising paragraph (g)(3), and
0
i. In paragraphs (g)(4)(i) and (ii) by removing the word ``accepted'' 
and adding in its place ``compliant,''.
    The revisions read as follows:


Sec.  1755.200  RUS standard for spicing copper and fiber optic cables.

* * * * *
    (g) * * *
    (3) Buried service wire shield bond connections. Buried service 
wire shields shall be connected to the pedestal bonding and grounding 
system. Typical buried service wire installations are shown in Figures 
17 and 18. In addition to the methods referenced in Figures 17 and 18, 
the shields of buried service wires may also be connected to the 
pedestal bonding and grounding system using buried service wire bonding 
harnesses. When those harnesses are used they shall be installed in 
accordance with the manufacturer's instructions. Figures 17 and 18 are 
as follows:
* * * * *
0
23. Amend Sec.  1755.390 by:
0
a. Removing paragraphs (a)(4) and (a)(5) and redesignate paragraphs 
(a)(6) as newly designated paragraph (a)(4) and (a)(7) as the new 
paragraph (a)(5);;
0
b. By revising paragraph (f)(3)
0
c. By revising paragraph (h)(3)
0
d. Removing paragraphs (p) and (q) and redesignate paragraphs (r) as 
newly designated paragraph (p) and (s) as newly designated paragraph 
(q);
0
e. Revising newly redesignated paragraphs (q)(8) and (q)(9); and
0
f. Removing Appendix A.
    The revisions read as follows:


Sec.  1755.390  RUS specification for filled telephone cables.

* * * * *
    (f) * * *
    (3) The individual cable manufacturer must demonstrate that the 
filling compound selected for use is suitable for its intended 
application. The filling compound must be applied to the cable in such 
a manner that the cable components will not be degraded.
* * * * *
    (h) * * *
    (3) The individual cable manufacturer must demonstrate that the 
flooding compound selected for use is acceptable for the application.
* * * * *
    (q) * * *
    (8) When cable manufactured to the requirements of this section is 
shipped, both ends must be equipped with end caps acceptable to owner.
    (9) When preconnectorized cables are shipped, the splicing modules 
must be protected to prevent damage during shipment and handling. The 
protection method must be acceptable to owner prior to its use.
* * * * *
0
24. Amend Sec.  1755.397 by:
0
a. Removing paragraph (b)(4) and redesignate paragraphs (b)(5) as newly 
designated paragraph (b)(4), (b)(6) as newly designated paragraph 
(b)(5), (b)(7) as newly designated paragraph (b)(6);
0
b. Revising newly redesignated paragraph (b)(5) by removing the word 
``accepted'' and adding in its place ``compliant'';
0
c. Revising paragraph (j)(l)(ii);
0
d. Revising paragraph (k)(10)(vii) by removing the word ``accepted'' 
and adding in its place ``compliant'';
0
e. Removing paragraph (k)(10)(viii); and
0
f. Revising paragraph (q)(8)(ii).
    The revisions read as follows:


Sec.  1755.397  RUS performance specification for line concentrators.

* * * * *
    (j) * * *
    (1) * * *
    (ii) Equipment must pass laboratory tests, simulating a hostile 
electrical environment, before being placed in the field for the 
purpose of obtaining field experience. There are five basic types of 
laboratory tests which must be applied to exposed terminals in an 
effort to determine if the equipment will survive. Figure 2 of this 
section, Summary of Electrical Requirements and Tests, identifies the 
tests and their application as follows:
* * * * *
    (q) * * *

[[Page 8334]]

    (8) * * *
    (ii) In the event that the measured data or operational tests show 
that equipment fails to meet the requirements of this section, the 
deficiencies are to be resolved as set forth in RUS Contract Form 395, 
Equipment Contract. (Copies are available from RUS, Room 0174, U.S. 
Department of Agriculture, Washington, DC 20250-1500.) The reports of 
the bidder and the owner shall be detailed as to deficiencies, causes, 
corrective action necessary, corrective action to be taken, completion 
time, etc.
* * * * *


Sec.  1755.501  [Amended]

0
25. In Sec.  1755.501 remove the definitions for ``RUS accepted 
(material and equipment)'' and ``RUS technically accepted (material and 
equipment)''.
0
26. Amend Sec.  1755.503 by revising paragraph (l) to read as follows:


Sec.  1755.503  General

* * * * *
    (l) All materials such as service wires and cables, ground rods, 
ground rod clamps, etc., used in service entrance installations shall 
be RUS compliant. Borrowers shall require contractors to obtain the 
borrower's approval before non-domestic materials are to be used in 
service entrance installations. Borrowers shall also ensure that the 
cost of the non-domestic materials are at least 6 percent less than the 
cost of equivalent domestic materials, as specified in ``Buy American'' 
Requirement of the Rural Electrification Act of 1936, as amended (7 
U.S.C. 903 note). Materials used in service entrance installations 
shall be of a suitable quality for their intended application as 
determined by the RUS borrower or the engineer delegated by the RUS 
borrower.
* * * * *
0
27. Amend Sec.  1755.505 by:
0
a. In paragraph (a) by removing the word ``accepted'' and adding in its 
place ``compliant'';
0
b. Revising paragraph (b); and
0
c. Revising paragraph (f)(12).
    The revisions read as follows:


Sec.  1755.505  Buried services.

* * * * *
    (b) Buried services of six or more pairs shall be RUS compliant 22 
AWG filled buried cable conforming to the requirements of Sec.  
1755.390, RUS specification for filled telephone cables.
* * * * *
    (f) * * *
    (12) If the NID, BET, or fused primary station protector must be 
mounted inside (not recommended by RUS), the service entrance into the 
building shall be installed in accordance with section 800-12(c) of 
ANSI/NFPA 70-1999, NEC [supreg]. After pulling-in the wire or cable, 
the free space around the cable or wire shall be carefully sealed both 
outside and inside with a duct sealer that is RUS compliant.
* * * * *
0
28. Amend Sec.  1755.506 by revising paragraph (a) to read as follows:


Sec.  1755.506  Aerial wire services.

    (a) Aerial services of one through six pairs shall consist of 
Service Entrance Aerial (SEA) assembly units, in accordance with RUS 
Bulletin 1753F-153 (RUS Form 515d), Specifications and Drawings for 
Service Installations at Customer Access Locations. The wire used for 
aerial services shall conform to the requirements of Sec. Sec.  
1755.700 through 1755.704, RUS specification for aerial service wires, 
and shall be RUS compliant. Copies of RUS Bulletin 1753F-153 are 
available upon request from RUS/USDA, 1400 Independence Avenue SW., 
STOP 1522, Washington, DC 20250-1522, FAX (202) 720-4120.
* * * * *
0
29. Amend Sec.  1755.507 by:
0
a. Revising paragraph (a) by removing the phrase ``RUS accepted or RUS 
technically accepted'' and adding in its place ``RUS compliant''; and
0
b. Revising paragraph (c)(12).
    The revisions read as follows:


Sec.  1755.507  Aerial cable services.

* * * * *
    (c) * * *
    (12) For the cable entrance, holes shall be bored slightly larger 
in diameter than the cable and shall slope upward from outside to 
inside. A duct sealer having RUS compliance shall be applied to both 
ends of the hole after the cable is pulled in.
* * * * *


Sec.  1755.508  [Amended]

0
30. Amend Sec.  1755.508 by:
0
a. Revising paragraph (c) by removing the phrase ``RUS accepted or RUS 
technically accepted'' and adding in its place ``RUS compliant'';
0
b. Revising paragraph (d) by removing the phrase ``RUS accepted or RUS 
technically accepted'' and adding in its place ``RUS compliant'';
0
c. Revising paragraph (e) by removing the phrase ``RUS accepted or RUS 
technically accepted'' and adding in its place ``RUS compliant'';
0
d. Revising paragraph (x) by removing the phrase ``RUS accepted or RUS 
technically accepted'' and adding in its place ``RUS compliant'';
0
e. Revising paragraph (aa) by removing the phrase ``RUS accepted or RUS 
technically accepted'' and adding in its place ``RUS compliant'';
0
f. Revising paragraph (dd)(4) by removing the phrase ``RUS accepted or 
RUS technically accepted'' and adding in its place ``RUS compliant'';
0
g. Revising paragraph (ee)(1) by removing the phrase ``RUS accepted or 
RUS technically accepted'' and adding in its place ``RUS compliant''; 
and
0
h. Revising paragraph (ee)(2) by removing the phrase ``RUS accepted or 
RUS technically accepted'' and adding in its place ``RUS compliant''.


Sec.  1755.510  [Amended]

0
31. Amend Sec.  1755.510 by removing paragraph (b) and redesignating 
paragraph (c) as newly designated paragraph (b).
0
32. Amend Sec.  1755.522 by:
0
a. Removing paragraphs (a)(10) and (a)(11) and redesignate paragraph 
(a)(12) as newly designated paragraph (a)(10);
0
b. Revising paragraph (c)(1) by removing the phrase ``RUS accepted 
system'' and adding in its place ``RUS compliant system'';
0
c. Revising paragraph (d)(4) by removing the phrase ``RUS accepted 
supplier'' and adding in its place ``RUS compliant supplier'';
0
d. Revising paragraph (e)(10) by removing the word ``RUS'' and adding 
in its place ``owner'';
0
e. Revising paragraph (f)(6)(iii) by removing the word ``accepted'' and 
adding in its place ``compliant'';
0
f. Revising paragraphs (s)(5) and (s)(5)(ii)(A);
0
g. Revising paragraphs (t)(6) and (t)(11);
0
h. Revising paragraph (y)(5)(iv), and
0
i. Revising Appendix D (8.2),
    The revisions read as follows:


Sec.  1755.522  RUS general specification for digital stored program 
controlled central office equipment.

* * * * *
    (s) * * *
    (5) Ringing generators. Regardless of whether the ringing is 
generated on an ancillary basis or is generated integrally to the 
switching system, the ringing equipment shall meet the requirements of 
this section.
* * * * *
    (ii) * * *
    (A) The ringing generators shall have an output voltage which 
approximates a sine wave and, as a minimum, shall be suitable for 
ringing straight-line ringers. Although not a requirement, decimonic, 
synchromonic, or harmonic ringing may also be specified in appendix A 
of this section.
* * * * *
    (t) * * *

[[Page 8335]]

    (6) If specified in appendix A of this section, each protector 
group shall be furnished with a factory assembled tip cable for 
splicing to the entrance cable; the tip cable to be 20 feet (610 cm) in 
length unless otherwise specified. Factory assembled tip cable shall be 
22 gauge. Tip cable requirements are provided in RUS Bulletin 
345-87, PE-87, RUS Specification for Terminating (TIP) Cable. Cables 
having other kinds of insulation and jackets which have equivalent 
resistance to fire and which produce less smoke and toxic fumes may be 
used if specifically approved by owner.
* * * * *
    (t)(11) Main frame protector makes and types shall be capable of 
easy removal.
* * * * *
    (y) * * *
    (5) * * *
    (iv) Appendix D of this section shall be the principal single-point 
grounding system audit guideline document. A supplemental checklist may 
be prepared and provided by the switching system supplier which 
recognizes unique grounding requirements related to their particular 
switching system. The scope of this supplier checklist is to be 
confined to unique and specific switching system requirements only. 
Supplier supplemental grounding checklist must have prior approval of 
owner.
* * * * *

 APPENDIX D to 7 CFR 1755.522--ACCEPTANCE CHECKLIST--SINGLEPOINT 
GROUNDING SYSTEM

* * * * *
    8.2 Incoming cable pairs terminated on MDF protector assemblies 
should be protected with protector modules. These modules should 
contain white coded carbon blocks or orange coded gas tube 
arrestors. (Refer to RUS TE&CM 810, Item 7.4.)
* * * * *
0
33. Amend Sec.  1755.701 by:
0
a. Revising paragraph (e); and
0
b. Revising paragraph (f) by removing the word ``RUS'' and adding in 
its place ``owner''
    The revision reads as follows:


Sec.  1755.701  Scope

* * * * *
    (e) All wires sold to RUS borrowers for projects involving RUS loan 
funds under Sec. Sec.  1755.700 through 1755.704 must be RUS compliant. 
For wires manufactured to the specification of Sec. Sec.  1755.700 
through 1755.704, all design changes to a compliant design must be 
submitted for acceptance by the RUS borrower's engineer.
* * * * *
0
34. Amend Sec.  1755.702 by revising paragraph (b)(2) to read as 
follows:


Sec.  1755.702  Copper coated steel reinforced (CCSR) aerial service 
wire.

* * * * *
    (b) * * *
    (2) The raw materials shall be RUS compliant prior to their use.
* * * * *
0
35. Amend Sec.  1755.703 by:
0
a. Revising paragraphs (b)(6) and (e)(2) to read as follows:


Sec.  1755.703  Nonmetallic reinforced (NMR) aerial service wire.

* * * * *
    (b) * * *
    (6) Repairs to the conductor insulation during manufacture are 
permissible. The method of repair shall be RUS compliant prior to its 
use. The repaired insulation shall comply with the requirement 
specified in ANSI/ICEA S-89-648-1993, paragraph 3.2.3.3.
* * * * *
    (e) * * *
    (2) The jacket raw materials shall be RUS compliant prior to their 
use.
* * * * *


Sec.  1755.704  [Removed and Reserved]

0
36. Remove and reserve Sec.  1755.704;
0
37. Amend Sec.  1755.860 by:
0
a. Revising paragraphs (a)(3) and (a)(4);
0
b. Revising paragraphs (b)(3), (b)(7)(i), and (b)(8);
0
c. Removing paragraphs (b)(5)(iv) and (b)(12);
0
d. Revising paragraphs (c)(4) and (c)(5);
0
e. Revising paragraph (e)(6);
0
f. Revising paragraph (h)(3);
0
g. Revising paragraphs (l)(4) and (l)(8);
0
h. Removing paragraphs (o), (p), (q), and redesignate paragraph (r) as 
newly designated paragraph (o);
0
i. Revising paragraphs (r)(3) and (r)(7) by removing the term ``RUS'' 
and adding in its place '' the purchaser''.
0
j. Removing APPENDIX A to Sec.  1755.860--QUALIFICATION TEST METHODS 
and redesignate APPENDICES B as newly designated APPENDIX A -to Sec.  
1755.860--Sheath Slitting Cord Qualification and APPENDIX C as newly 
designated APPENDIX B --Thermal Reel Wrap Qualification; and
0
k. Revising new APPENDIX B to Sec.  1755.860(III)(8).
    The revisions read as follows:


Sec.  1755.860  RUS specification for filled buried wires.

    (a) * * *
    (3) All wires sold to RUS borrowers for projects involving RUS loan 
funds under this section must be RUS compliant. For wires manufactured 
to the specification of this section, all design changes to a compliant 
design must be accepted by the RUS borrower's engineer.
    (4) Materials, manufacturing techniques, or wire designs not 
specifically addressed by this section may be allowed if RUS compliant. 
Justification for acceptance of modified materials, manufacturing 
techniques, or wire designs must be provided to substantiate product 
utility and long term stability and endurance.
* * * * *
    (b) * * *
    (3) Joints made in conductors during the manufacturing process may 
be brazed, using a silver alloy solder and nonacid flux, or they may be 
welded using either an electrical or cold welding technique. In joints 
made in uninsulated conductors, the two conductor ends must be butted. 
Splices made in insulated conductors need not be butted but may be 
joined in a manner acceptable to the RUS borrower's engineer.
* * * * *
    (7) * * *
    (i) All insulated conductors must be continuously tested for 
insulation faults during the twinning operation with the method of test 
acceptable to the RUS borrower's engineer. The length count and number 
of faults must be recorded. The information must be retained for a 
period of 6 months and be available for review by the RUS borrower's 
engineer when requested.
* * * * *
    (8) Repairs to the conductor insulation during manufacturing are 
permissible. The method of repair must be accepted by the RUS 
borrower's engineer prior to its use. The repaired insulation must be 
capable of meeting the relevant electrical requirements of this 
section.
* * * * *
    (c) * * *
    (4) Positive identification of the tip and ring conductors of each 
pair by marking each conductor of a pair with the color of its mate is 
permissible. The method of marking must be accepted by the RUS 
borrower's engineers prior to its use.
    (5) Other methods of providing positive identification of the tip 
and ring conductors of each pair may be employed if accepted by the RUS 
borrower's engineers prior to its use.
* * * * *
    (e) * * *
    (6) The individual wire manufacturer must have satisfactory 
performance

[[Page 8336]]

results that the filling compound selected for use is suitable for its 
intended application. The filling compound must be compatible with the 
wire components when tested in accordance with ASTM D 4568-86 at a 
temperature of 80 [deg]C.
* * * * *
    (h) * * *
    (3) The individual wire manufacturer must have satisfactory 
performance results that the flooding compound selected for use is 
acceptable for the application.
* * * * *
    (l) * * *
    (4) An alternative method of marking may be used if accepted by the 
RUS borrower's engineer prior to its use.
* * * * *
    (8) The method of marking must be by means of suitable surface 
markings producing a clear, distinguishable, contrasting marking 
acceptable to the RUS borrower's engineer. Where direct or transverse 
printing is employed, the characters should be indented to produce 
greater durability of marking. Any other method of length marking must 
be acceptable to the RUS borrower's engineer as producing a marker 
suitable for the field. Size, shape and spacing of numbers, durability, 
and overall legibility of the marker will be considered in acceptance 
of the method.
* * * * *

Appendix B to Sec.  1755.860--Thermal Reel Wrap Qualification

* * * * *
    (III) * * *
    (8) For the thermal reel wrap to be RUS compliant, the 
temperature differences between the jacket with the thermal reel 
wrap and the jacket without the reel wrap must be greater than or 
equal to 17 [deg]C.
* * * * *
0
38. Amend Sec.  1755.870 by:
0
a. Removing paragraphs (a)(3) and (a)(4) and redesignate paragraphs 
(a)(5) as newly designated paragraph (a)(3), (a)(6) as newly designated 
paragraph (a)(4), (a)(7) as newly designated paragraph (a)(5), (a)(8) 
as newly designated paragraph (a)(6);
0
b. Revising paragraph (b)(2) by removing the term ``RUS'' and adding in 
its place ``the RUS borrower's engineer'';
0
c. Removing paragraph (b)(5)(v);
0
d. Revising paragraph (b)(8)(iv) by removing the term ``RUS'' and 
adding in its place ``the end user'';
0
e. Revising paragraph (b)(9) by adding the words ``the RUS borrower's 
engineer'' after the term RUS;
0
f. Removing paragraph (b)(13);
0
g. Revising paragraphs (c)(4) and (c)(5) by removing the term ``RUS'' 
and adding in its place ``the RUS borrower's engineer'';
0
h. Revising paragraph (f)(8)(ii) by removing the term ``RUS'' and 
adding in its place ``the RUS borrower's engineer'';
0
i. Revising paragraphs (k)(4) and (k)(8) by removing all references to 
the term ``RUS'' and replacing with the phrase ``the RUS borrower's 
engineer'';
0
j. Revising paragraph (l)(2),
0
k. Removing paragraphs (m) and (n) and redesignate paragraphs (o) as 
newly designated paragraph (m) and (p) as newly designated paragraph 
(n);
0
l. Revising paragraphs (o)(2), (o)(3), (o)(5), and (o)(8) by removing 
the term ``RUS'' and adding in its place ``the RUS borrower's 
engineer''; and
0
m. Removing APPENDIX A.
    The revision reads as follows:


Sec.  1755.870  RUS specification for terminating cables.

* * * * *
    (l) * * *
    (2) The splicing modules shall meet the requirements of RUS 
Bulletin 345-54, PE-52, RUS Specification for Telephone Cable Splicing 
Connectors (Incorporated by Reference at Sec.  1755.97), and be RUS 
compliant prior to their use.
* * * * *
0
39. Amend Sec.  1755.890 by:
0
a. Revising paragraph (a)(4),
0
b. Revising paragraph (a)(5) by removing the term ``RUS'' and adding in 
its place ``the RUS borrower's engineer'';
0
c. Revising paragraphs (b)(7)(i) and (b)(8) by removing the term 
``RUS'' and adding in its place ``the RUS borrower's engineer'';
0
d. Revising paragraphs (c)(3) and (c)(4) by removing the term ``RUS'' 
and adding in its place ``the RUS borrower's engineer'';
0
e. Revising paragraph (f)(3) by removing the term ``RUS'' and adding in 
its place ``the RUS borrower's engineer'';
0
f. Revising paragraph (h)(3) by removing the term ``RUS'' and adding in 
its place ``the RUS borrower's engineer'';
0
g. Revising paragraph (i)(5) by removing the term ``RUS'' and adding in 
its place ``the RUS borrower's engineer'';
0
h. Revising paragraph (o)(2),
0
i. Removing paragraph (p);
0
k. Removing paragraph (q);
0
l. Revising paragraphs (s)(8) and (s)(9) and
0
m. Removing APPENDIX A.
    The revisions read as follows:


Sec.  1755.890  RUS specification for filled telephone cables with 
expanded insulation.

    (a) * * *
    (4) All cables sold to RUS borrowers for projects involving RUS 
loan funds under this section must be accepted by the RUS borrower's 
engineer. For cables manufactured to the specification of this section, 
all design changes to an accepted design must be submitted for 
acceptance. The RUS borrower's engineer will be the sole authority on 
what constitutes a design change.
* * * * *
    (o) * * *
    (2) The splicing modules must meet the requirements of RUS Bulletin 
345-54, PE-52, RUS Specification for Telephone Cable Splicing 
Connectors (Incorporated by Reference at Sec.  1755.97), and be RUS 
compliant prior to their use.
* * * * *
    (s) * * *
    (8) When cable manufactured to the requirements of this 
specification is shipped, both ends must be equipped with end caps 
acceptable to the RUS borrower's engineer.
    (9) When preconnectorized cables are shipped, the splicing modules 
must be protected to prevent damage during shipment and handling. The 
protection method must be acceptable to the RUS borrower's engineer 
prior to its use.
* * * * *


Sec.  1755.900  [Amended]

0
40. Amend Sec.  1755.900 by:
0
a. Removing paragraph (b)(1) and redesignate paragraphs (b)(2) as newly 
designated paragraph (b)(1), (b)(3) as newly designated paragraph 
(b)(2), (b)(4) as newly designated paragraph (b)(3), (b)(5) as newly 
designated paragraph (b)(4), (b)(6) as newly designated paragraph 
(b)(5), (b)(7) as newly designated paragraph (b)(6), (b)(8) as newly 
designated paragraph (b)(7), (b)(9) as newly designated paragraph 
(b)(8), (b)(10) as newly designated paragraph (b)(9), (b)(11) as newly 
designated paragraph (b)(10), (b)(12) as newly designated paragraph 
(b)(11), (b)(13) as newly designated paragraph (b)(12), (b)(14) as 
newly designated paragraph (b)(13), (b)(16) as newly designated 
paragraph (b)(14), (b)(17) as newly designated paragraph (b)(15), 
(b)(18) as newly designated paragraph (b)(16), (b)(19) as newly 
designated paragraph (b)(17), (b)(20) as newly designated paragraph 
(b)(18), (b)(21) as newly designated paragraph (b)(19), (b)(22) as 
newly designated paragraph (b)(20), (b)(23) as newly designated 
paragraph (b)(21), (b)(24) as newly designated paragraph (b)(22), 
(b)(25) as newly designated paragraph (b)(23), (b)(26) as newly 
designated paragraph (b)(24), (b)(27) as newly designated paragraph 
(b)(25), (b)(28) as newly designated paragraph (b)(26), (b)(29) as 
newly designated paragraph (b)(27), (b)(30) as

[[Page 8337]]

newly designated paragraph (b)(28), (b)(31) as newly designated 
paragraph (b)(29), (b)(32) as newly designated paragraph (b)(30;
0
41. Amend Sec.  1755.902 by:
0
a. Revising paragraph (a)(8) by removing the word ``Agency'' and adding 
in its place ``RUS borrower's engineer'';
0
b. Revising paragraph (a)(9):
0
c. Revising paragraph (h)(3) by removing the word ``Agency'' and adding 
in its place ``RUS borrower's engineer'';
0
d. Revising paragraph (i)(3) by removing the word ``Agency'' and adding 
in its place ``RUS borrower's engineer'';
0
e. Revising paragraph (s)(2),
0
f. Removing paragraph (t);
0
g. Removing paragraph (u); and
0
h. Removing Appendix to Sec.  1755.902 .
    The revisions read as follows:
* * * * *


Sec.  1755.902  Minimum performance specification for fiber optic cable

    (a) * * *
    (9) All cables sold to RUS telecommunications borrowers for 
projects involving RUS loan funds must be accepted by the RUS 
borrower's engineer.
* * * * *
    (s) * * *
    (2) All connectors must be accepted by the RUS borrower's engineer 
prior to their use.
* * * * *
0
42. Amend Sec.  1755.903 by:
0
a. Revising paragraphs (a)(4) and (a)(9);
0
b. Revising paragraph (g)(3) by removing the word ``Agency'' and adding 
in its place ``RUS borrower's engineer'';
0
c. Revising paragraph (q)(2),
0
d. Removing paragraph (r); and
0
e. Removing paragraph (s).
    The revisions read as follows:


Sec.  1755.903  Fiber optic service entrance cables

    (a) * * *
    (4) Optical cable designs not specifically addressed by this 
section may be allowed. Justification for acceptance of a modified 
design must be provided to substantiate product utility and long term 
stability and endurance.
* * * * *
    (9) All cables sold to RUS Telecommunications borrowers must be RUS 
compliant for projects involving RUS loan funds. All design changes to 
Agency compliant designs must be submitted to the RUS borrower's 
engineer for compliance. Optical cable designs not specifically 
addressed by this section may be allowed, if accepted by the RUS 
borrower's engineer. Justification for acceptance of a modified design 
must be provided to substantiate product utility and long term 
stability and endurance.
* * * * *
    (q) * * *
    (2) All connectors must be accepted by the RUS borrower's engineer 
prior to their use.
* * * * *
0
43. Amend Sec.  1755.910 by:
0
a. Revising paragraph (a)(3);
0
b. Removing paragraph (c)(3);
0
c. Revising paragraphs (d)(1)(ii) and (d)(2)(vi);
0
d. Revising paragraphs (d)(3)(xx) and (d)(3)(xxvii) by removing the 
word ``accepted'' and adding in its place ``compliant'',
0
e. Revising paragraphs (d)(4)(iv), (d)(5)(iii) and (d)(5)(x) by 
removing the word ``RUS'' and adding in its place ``the RUS borrower's 
engineer'',
0
f. Revising paragraphs (d)(6)(v) by removing the word ``acceptance'' 
and adding in its place ``compliance''; and
0
g. Revising paragraphs (e)(3)(xii)(A)(1), (e)(3)(xii)(B)(1), 
(e)(4)((viii)(A) and (e)(6)(v).
    The revisions read as follows:


Sec.  1755.910  RUS specification for outside plant housings and 
serving area interface system.

    (a) * * *
    (3) The test procedures described in this section are required by 
RUS to demonstrate the functional reliability of the product. However, 
other standard or unique test procedures may serve the same function. 
In such cases, the RUS borrower's engineer shall evaluate the test 
procedures and results on an individual basis.
* * * * *
    (d) * * *
    (1) * * *
    (ii) Housings shall be of sufficient size to permit easily managed 
installation, operational, testing, and maintenance operations. The 
general shape of outside plant housings is usually comparable to that 
of a rectangular column or cylinder, with the shape of any particular 
housing being left to the manufacturer's discretion.
    (2) * * *
    (vi) Note 1: Additional sizes of splice cabinets shall be 
considered by the RUS borrower on a case-by-case basis.
* * * * *
    (e) * * *
    (3) * * *
    (xii)(A)(1) Note: The procedures for housings with larger surface 
area will be evaluated by the RUS borrower's engineer on a case-by-case 
basis.
* * * * *
    (B)(1) Note: The procedures for housings with larger surface areas 
will be evaluated by the RUS borrower's engineer on a case-by-case 
basis.
* * * * *
    (4) * * *
    (viii) * * *
    (A) Note: Test procedures for housings with larger doors will be 
evaluated by the RUS borrower's engineer on a case-by-case basis.
* * * * *
    (6) * * *
    (v) Secondary finish evaluation. Evidence of secondary protection 
shall be required for RUS compliance. Typical secondary protection is 
galvanizing per ASTM A 526/A 526M-90 for steel surfaces.
* * * * *

    Dated: November 21, 2013.
John Charles Padalino,
Administrator, Rural Utilities Service.
[FR Doc. 2014-01340 Filed 2-11-14; 8:45 am]
BILLING CODE P