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14 <br /> 1 also revises the payment terms to 15 days instead of 30 days after work is completed. The <br /> 2 disbursement schedule is subject to change. <br /> 3 BACKGROUND: In June 2022, the Board of Commissioners finalized an agreement with North <br /> 4 State Communications Advanced Services, LLC (formerly known as Lumos Fiber and now <br /> 5 doing business as T-Fiber) to deploy a fiber optic broadband network to 6,370 unserved <br /> 6 locations in Orange County. Unserved locations are defined by State law as locations that do <br /> 7 not have access to internet service that provides speeds of 25 megabits per second (Mbps) <br /> 8 download and 3 Mbps upload. The statutory authority under which the County is authorized to <br /> 9 make grants for broadband deployment only allows those grant funds to be used to serve <br /> 10 unserved locations. <br /> 11 <br /> 12 The County funded this public-private partnership with a $10 million grant using American <br /> 13 Rescue Plan Act (ARPA) funds. Payments of the grant funds to Lumos are based on <br /> 14 performance. Lumos was paid a $1 million start up payment following approval of the contract. <br /> 15 The first benchmark of passing 3,000 homes was also achieved which triggered the second <br /> 16 benchmark payment of $3 million. A total of $4 million has been paid to Lumos to date. A <br /> 17 passing is defined as "a location, such as a home or business, that is near enough to a fiber- <br /> 18 optic network to be connected without major construction, typically because the network already <br /> 19 runs along the street or right-of-way and is technically ready to be connected for service upon <br /> 20 customer request". The original deadline to serve these homes was December 31, 2024. <br /> 21 <br /> 22 During spring 2024, Lumos began experiencing delays due to construction and budget issues, <br /> 23 and much of the construction activity on the project slowed considerably. Those issues were <br /> 24 resolved, and construction resumed in earnest in late summer 2024. However, those delays did <br /> 25 have an impact on the overall project schedule and the project is over budget. As a result, <br /> 26 Lumos has proposed to revise the number of passings to 5,852, completing 92% of the <br /> 27 passings in the original contract. The County has also explored alternative strategies to <br /> 28 advance project completion should Lumos not continue, including the potential issuance of an <br /> 29 RFP to address the remaining passings. <br /> 30 <br /> 31 The County has complied with the first ARPA deadline by committing ARPA funding through the <br /> 32 contract with Lumos by December 31, 2024. Once obligated, the funds can only be used for the <br /> 33 purpose specified in the obligation. The final deadline to spend the ARPA funding is December <br /> 34 31, 2026, so this contract amendment does not jeopardize the availability of ARPA funding. <br /> 35 <br /> 36 To date, Lumos has installed 739 route miles of fiber in Orange County. This network is <br /> 37 available to 14,981 total homes including 5,187 previously unserved and underserved homes <br /> 38 included in the 2022 agreement. <br /> 39 <br /> 40 The original Lumos project did not reach all the unserved and underserved homes in the <br /> 41 County. These areas have been referred to as doughnut holes where approximately 600 <br /> 42 unserved and underserved homes are located. The County has consulted with the North <br /> 43 Carolina Division of Broadband and Digital Equity, and the most likely funding solution to serve <br /> 44 those homes will be through the Broadband Equity and Deployment (BEAD) and Stop Gap <br /> 45 Funding Programs which has the goal of reaching 100% of unserved and underserved homes. <br /> 46 The County will also pursue Stop Gap funding to address the gap between the original Lumos <br /> 47 contract passing count of 6,370 and the revised passing count of 5,852. The funding process for <br /> 48 the BEAD and Stop Gap programs is expected to begin in Fall 2025. County staff will provide <br /> 49 updates as more details become available. The agreements and this proposed amendment are <br /> 50 between Orange County and North State Communications Advanced Services, LLC, which <br /> 51 remains the same legal entity named in the original contracts. Although the company operates <br />