INSIGHTi


Secure and Trusted Communications
Networks Reimbursement Program:
Frequently Asked Questions
Updated February 8, 2022
What Is the Secure and Trusted Communications
Networks Reimbursement Program?
On March 12, 2020, the Secure and Trusted Communications Networks Act of 2019 (P.L. 116-124)
(Secure Networks Act) became law. The act addresses congressional concerns with telecommunications
network equipment that may pose a national security threat to the United States. Section 2 directs the
Federal Communications Commission (FCC) to create a list of “covered” telecommunications equipment
that poses a national security threat. Section 4 directs the FCC to create the Secure and Trusted
Communications Networks Reimbursement Program (Reimbursement Program) to reimburse
telecommunication providers that replace “covered” equipment (see FCC website).
How Much Funding Is Available?
 On December 27, 2020, the Consolidated Appropriations Act (CAA), 2021 (P.L. 116-
260) became law. Section 906 provides $1.9 billion to the FCC for the Secure Networks
Act; $1.895 billion of that is for the Reimbursement Program. To date, no other funding
has been provided.
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IN11663
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Who Is Eligible for Reimbursement Funding?
Under the Secure Networks Act, eligible entities include providers of “advanced communications
services,”—high-speed broadband providers. The act aims to reimburse small providers—those with two
million or fewer customers—that replace “covered” equipment.
In Section 901 of the CAA 2021, Congress amended the Secure Networks Act, making providers with
fewer than ten million customers eligible for reimbursement. Congress made “accredited public or private
noncommercial educational institutions that provide facilities-based educational broadband services” and
health care providers and libraries that provide advanced communication services eligible for
reimbursement funding. Congress prioritized allocations:
 First, to providers with two million or fewer customers;
 Next, to accredited public or private noncommercial educational institutions providing
facilities-based educational broadband service; and
 Last, to any remaining eligible applicants.
What Are “Covered” Equipment and Services?
In November 2019, the FCC first defined “covered equipment” in its 2019 Supply Chain Order. It
prohibited use of Universal Service Fund support to purchase equipment or services produced by a
“covered company.” It designated two Chinese firms, Huawei Technologies Co., Ltd. and ZTE
Corporation, as “covered companies.”
In March 2020, the Secure Networks Act (Section 2) required the FCC to publish, within one year, a list
of “covered equipment and services,” including equipment identified by other federal agencies, and to
update the list.
On June 30, 2020, the FCC issued final Designation Orders for Huawei and ZTE, naming them “covered
companies.”
On December 27, 2020, Section 901 of the CAA, 2021 amended the Secure Networks Act, limiting the
use of reimbursement funds for equipment identified in the FCC’s 2019 Supply Chain Order and
Designation Orders (i.e., Huawei and ZTE).
In March 2021, per the Secure Networks Act (Section 2), the FCC released a list of “covered equipment
and services” that included products of Huawei, ZTE, and three Chinese firms. The Reimbursement
Program, following CAA, 2021 covered only Huawei and ZTE equipment.
On August 3, 2021, the FCC released a Final Catalog of Eligible Expenses and Estimated Costs to help
entities develop reimbursement cost estimates for “covered” equipment obtained between April 17, 2018,
and June 30, 2020. By law, the FCC can consider “costs reasonably incurred” on a case-by-case basis.
When Can Entities Apply?
The application period opened on October 29, 2021, and was to close on January 14, 2022. On December
21, 2021, the Rural Wireless Association (RWA) and NTCA—The Rural Broadband Association filed a
Motion for Extension of Time, seeking a one-month extension. The associations claimed that “collecting
the necessary cell site data, filling out the numerous entries in the location, equipment, and cost estimates,
and attaching necessary documentation is a massive undertaking that requires substantial work.” Their
members, small rural providers, reported financial and workforce challenges due to the holidays and
Coronavirus Disease 2019 (COVID-19). The FCC granted a 14-day extension through January 28, 2022.

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When Is Funding Announced?
The FCC and its Fund Administrator are reviewing applications. The FCC must act on applications within
90 days; it can extend that deadline by 45 days. It expects to communicate with applicants in the first
quarter of 2022, and allow entities to correct deficiencies in their application within 15 days. It plans to
announce approved applicants and reimbursement amounts by the second quarter of 2022.
What If Requests Exceed Funds Available?
The FCC is required to notify Congress immediately if appropriations are not sufficient to fully fund all
approved applications. On February 4, 2022, the FCC notified Congress that it received over 180
applications totaling $5.6 billion—nearly three times the amount Congress provided. Application review
is ongoing; thus, the $5.6 billion reflects funds requested, not amounts needed to fully fund all approved
applications.
How Do Entities Apply for Reimbursement?
Once the FCC announces allocation amounts, entities may seek reimbursement. Entities must file at least
one reimbursement within one year of the allocation announcement; otherwise, the FCC can reclaim
funds. Entities have one year from the announcement to complete the replacement, and 120 days after that
to file final reimbursements.
What Are the Reporting Requirements?
By law, recipients must file updates every 90 days, spending reports twice a year, and an annual report to
the FCC. Entities must certify they have a plan and timeline for removal; will remove and not purchase
“covered” equipment; and will consult the National Institute of Standards and Technology Cybersecurity
Framework. By law, the FCC must report to Congress every 180 days.
How Do Entities Dispose of Equipment?
On September 30, 2021, the FCC published best practices on equipment disposal, required by law.
What Factors May Affect Implementation?
Entities expressed concern about the one-year implementation timeline, citing shortages of computer
chips; leasing agreements they may need to modify; coordination with tower owners; finding workers;
and weather. By law, the FCC can grant a general extension for all entities or an individual extension for
delays caused through no fault of its own (e.g., weather).

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Author Information

Jill C. Gallagher

Analyst in Telecommunications Policy





Disclaimer
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Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of
information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
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IN11663 · VERSION 5 · UPDATED

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