TITLE 34. PUBLIC FINANCE

PART 1. COMPTROLLER OF PUBLIC ACCOUNTS

CHAPTER 16. COMPTROLLER GRANT PROGRAMS

SUBCHAPTER B. TEXAS BROADBAND DEVELOPMENT OFFICE

DIVISION 1. BROADBAND DEVELOPMENT MAP

The Comptroller of Public Accounts adopts amendments to §16.21, concerning broadband development map, §16.22, concerning map challenges; criteria, §16.23, concerning challenge process; deadlines, and §16.24, concerning reclassification determinations, without changes to the proposed text as published in the November 21, 2025, issue of the Texas Register (50 TexReg 7512). The rules will not be republished.

The amendments to §16.21 remove the requirement for the office to create, update or publish a map if the office adopts a map produced by the Federal Communications Commission and include conforming changes.

The amendments to §16.22 provide that a challenge may occur only if the office does not adopt a map produced by the Federal Communications Commission and remove references to a challenge process if the office adopts a map produced by the Federal Communications Commission.

The amendments to §16.23 remove unnecessary deadlines related to the office adopting a map produced by the Federal Communications Commission and remove unnecessary notice procedures. The amendments maintain the challenge procedures for a map the office creates for future use in the event the office chooses to create its own map.

The amendments to §16.24 modify the name of the section to more specifically reflect the outcome of the challenge process.

The comptroller did not receive any comments regarding adoption of the amendments.

The amendments are adopted under Government Code, §490I.0109, which permits the comptroller to adopt rules as necessary to implement Chapter 490I regarding the Texas Broadband Development Office.

The amendments implement Government Code, Chapter 490I.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 25, 2026.

TRD-202600917

Victoria North

General Counsel for Fiscal and Agency Affairs

Comptroller of Public Accounts

Effective date: March 17, 2026

Proposal publication date: November 21, 2025

For further information, please call: (512) 475-2220

DIVISION 2. BROADBAND DEVELOPMENT PROGRAM

34 TAC §§16.30, 16.31, 16.35 - 16.38, 16.40 - 16.42, 16.46

The Comptroller of Public Accounts adopts amendments to §16.30, concerning definitions, §16.31, concerning notice of funds availability, §16.35, concerning program eligibility requirements, §16.36, concerning application process generally, §16.40, concerning evaluation criteria, §16.41, concerning application protest process, §16.42, concerning awards; grant agreement, and §16.46, concerning forms; notices, with changes to the proposed text as published in the November 21, 2025, issue of the Texas Register (50 TexReg 7514). The rules will be republished. The Comptroller of Public Accounts also adopts new §16.37, concerning direct contract and grant awards, and new §16.38, concerning fixed amount awards with changes to the proposed text as published in the November 21, 2025, issue of the Texas Register (50 TexReg 7514). The rules will be republished. The new sections replace §16.37, concerning overlapping applications or project areas, and §16.38, concerning overlapping project areas in noncommercial applications, which the comptroller will repeal in a separate rulemaking.

The amendments to §16.30 remove the "application protest period" and "designated area" definitions, add the "gigabit-level broadband service" definition, and add the "interested party" definition, which was previously in §16.41. The amendments modify the "served location" definition for brevity. The amendments to the "unserved location" definition provide speed requirements for public schools and community anchor institutions.

The amendments reword §16.31 for brevity and modify the publication process. The amendments remove the requirement for a notice of funds availability to state the minimum and maximum amounts of grant funds available for each application. The amendments clarify that eligibility criteria will be in each notice of funds availability.

The amendments to §16.35 change the title to "Competitive Grant Limitations." The amendments remove eligibility criteria details as unnecessary because §16.31 requires a notice of funds availability to include eligibility criteria. The amendments modify non-commercial provider limitations to competitive grants for the deployment of last-mile broadband service projects in subsection (b).

The amendments to §16.36 add "competitive grant" in the title and in subsection (b) to specify that this section applies to competitive grants. The amendments change "protest" to "publishing" to describe the 30-day period in subsection (d). The amendments describe notification after the challenge process and requests for additional information in subsections (f) and (g) respectively. The amendments remove certain provisions related to the challenge process for placement in §16.30 and §16.41.

New §16.37 describes the office's ability to award direct contract or grant awards on a non-competitive basis to a political subdivision in subsection (a). The section permits the office to award a direct contract or grant award with a grant agreement and to require information be submitted electronically in subsection (b).

New §16.38 describes fixed amount awards in subsection (a). The section permits the office to award a fixed amount award for competitive and direct grants without regard to the Texas Acquisition Threshold as defined in the Texas Grant Management Standards in subsection (b).

The amendments to §16.40 remove the reference to Government Code, §490I.0105 in subsection (a)(4) as required by Senate Bill 1405, 89th Legislature, R.S., 2025.

The amendments to §16.41 change the title of the section to "Application Challenge Process" to reflect the more commonly used term and make conforming changes throughout the section. The amendments in subsection (a) provide that only applications related to last-mile broadband infrastructure projects are subject to the challenge process and only the location may be challenged. The amendments describe under what circumstances a successfully challenged application may be amended and resubmitted in subsections (d) and (g). The amendments add subsections (g), (h) and (i) that are transferred from §16.36(f), (g) and (i) respectively, and make a conforming change to subsection (i).

The amendment to §16.42 adds the statutory requirement for last-mile infrastructure grant recipients to make reasonable efforts to restore private property affected by a broadband infrastructure project in subsection (d).

The amendments to §16.46 allow notice by certified mail and make conforming changes in subsections (c) and (d). The amendments remove subsection (e) relating to §16.34 that was previously repealed.

The comptroller received comments regarding adoption of the amendments and proposed new rules from the Texas Broadband Association ("TBBA"); Texas Cable Association ("TCA"); and Texas Telephone Association ("TTA").

The comptroller thanks these organizations for the suggestions, information, and legal arguments. This office appreciates the time and resources devoted to drafting and submitting the written and oral comments. These thoughtful comments helped make the rules more effective.

The TBBA requests replacing "or" with "and" in the definition of "gigabit-level broadband service" in the amendments to §16.30(8)(A) to ensure both the 1000 Mbps download and 20 Mbps upload speeds are required. The comptroller agrees with this comment and implements the suggestion as this will apply the appropriate standard for determining whether a public school or community anchor institution is underserved.

The TBBA requests requiring the comptroller publish notices of funding availability on the comptroller's website in addition to the Electronic State Business Daily ("ESBD") in §16.31(a). The TBBA believes the comptroller's website is a known repository for information about funding opportunities that should include the notices regarding funding opportunities. While the comptroller appreciates the commenter's concerns, the comptroller declines to make a change. Section 16.31(a) as amended allows for continued publishing of a link to the notice of funding availability on the comptroller's website. The change in §16.31(a) provides for a single, official location for notices of funds availability on the ESBD, which is in alignment with other funding opportunities across the state. This change will improve efficiency with the program as well as simplify the publication process.

The TBBA requests amending proposed §16.37 to include certain guardrails to protect transparency. First, the TBBA recommends that non-competitive awards occur only if they are expressly statutorily authorized or directed via specific legislative appropriation. While the comptroller appreciates this recommendation, the comptroller declines to make this change. The legislature amended Government Code, §490I.0106 by enacting Senate Bill 1405, 89th Legislature, R.S., 2025. The addition of "contracts" in Government Code, §490I.0106 conforms with the comptroller's existing authority to enter into interagency and interlocal contracts with other governmental entities permitted under Government Code, Chapters 771 and 791. Further, the removal of "to applicants" from Government Code, §490I.0106(a), (a-1), (a-2) and (a-3) makes clear that the award process is not limited to a competitive application process. There is no need for further statutory authorization. Additionally, funds awarded from the Broadband Infrastructure Fund (BIF) do not require further legislative appropriation as provided in Texas Constitution, article III, §49-d-16 and Government Code, §403.653. The proposal by TBBA is unnecessary under current state law.

Alternatively, TBBA requests including a 30-day comment period prior to issuance of a non-competitive contract or award that includes a rationale by the comptroller as to why the political subdivision is being granted the funds and why a competitive process is infeasible in the circumstance to prevent duplicative efforts. Existing authority still allows the comptroller to craft a notice of funding availability and other requirements for other broadband projects to ensure that a proposed project complements and does not duplicate any existing infrastructure. However, the statutory requirements for a posting period and comments applies only to accepted applications for competitive grants and does not apply to contracts with local government. When the legislature removed "to applicants" from Government Code, §490I.0106(a), (a-1), (a-2) and (a-3), the legislature did not remove "applicant" or "application" from (e) or (f). The comptroller appreciates the commenter's concerns but declines to change the proposed rule to add extra procedures and time delays that would inhibit direct contracts of their efficiency, cost savings and speed of implementation.

The TBBA requests clarification, to mitigate confusion, that any awards made under proposed §16.37 are subject to §16.35. However, §16.35 incorporates Government Code, §490I.0106(d)(2) which prevents competitive awards to a non-commercial broadband service provider for last-mile broadband deployment if an eligible commercial broadband service provider has previously submitted an application for the same location. The rule implements recent legislation authorizing direct awards that are not subject to an application process. The comptroller will comply with all rules and statutes that govern the office when those rules and statutes apply, and declines to incorporate this request within the proposed rule.

The TBBA requests amending proposed §16.38 to limit fixed amount awards 'without regard to actual costs incurred' only for competitively awarded grants due to fiscal responsibility concerns. The proposed description of "fixed amount awards" mirrors text from the Texas Grant Management Standards Guide published by the comptroller. Under the analysis of Attorney General Opinion KP-0099 (2016), a fixed amount grant can comply with state fiscal law if there is a sufficient return benefit (ex: speed of implementation for public safety related grants, cost savings by forgoing extra process to monitor and analyze, and risk shifting). Adding competition is not necessary for fixed amount grants to comply with state fiscal law. The return benefits for the comptroller are the ability to promptly implement grant programs, the cost savings to the state by forgoing the extra procedures required for competitive reimbursement grants, and shifting the risk of underestimating costs to the grantee. As stated in the fiscal note, the rule will benefit the public by providing greater flexibility in broadband project funding while facilitating further access to and adoption of broadband service across the state. To clarify that fixed amount awards are based on reasonable, estimated costs provided by the grantee prior to award, the comptroller adopts the rule with changes to remove "without regard to actual costs incurred" and add "based on reasonable, estimated costs."

The TCA requests requiring all grants awarded by the comptroller to be competitive to provide important safeguards because TCA disagrees that political subdivisions should receive a non-competitive contract or award for any broadband project. This requirement would be contrary to recent legislative amendments. The addition of "contracts" in Government Code, §490I.0106 conforms with the comptroller's existing authority to enter into interagency and interlocal contracts with other governmental entities permitted under Government Code, Chapters 771 and 791. Further, the removal of "to applicants" in Government Code, §490I.0106(a), (a-1), (a-2) and (a-3) clarifies that the award process is not limited to a competitive application process. Further, unlike private entities, local governments have the additional safeguard of governance that is accountable to the public through, for example, gubernatorial appointments subject to senate confirmation, or through elections. Because there is established state law and guidance in the Texas Procurement and Contract Management Guide regarding direct interlocal contracts, the comptroller is satisfied with the existing guardrails to protect transparency and integrity in the award process. The comptroller declines to change the proposed rule in response to this comment.

Alternatively, TCA requests that non-competitive contracts or awards be limited to non-deployment-related programs. The TCA believes non-deployment-related programs permitted by Government Code, §490I.0106 (a-3) are similar to traditional government functions and would not conflict with existing last-mile internet service. The TCA believes that no non-competitive contracts or awards should ever go to broadband deployments or support retail or wholesale internet service. This requirement would be contrary to recent legislative amendments. While the comptroller appreciates the commenter's concerns, the comptroller declines to change the statutorily authorized rule. The comptroller disagrees that this change is necessary to protect transparency and integrity in the award process.

The TCA notes a possible conflict and requests clarification on how these non-competitive awards will impact other statutory requirements; specifically posting on the comptroller's website the award process information, criteria for awards and received applications. The requirements of Government Code, §490I.0106(e) continue to apply to the competitive award process, as discussed previously, and the requirements of §490I.0106(h) apply to both. The comptroller notes no plans to remove the competitive process as a means to award funds; therefore, these statutory requirements will be given full meaning and effect, and it is not necessary to change the rule.

The TCA argues that a competitive process ensures the best value for the agency and requests clarification on how the non-competitive process will be in alignment with the Texas Grant Management Standards and state law. Adding competition is not necessary in all cases for grants to comply with state fiscal law. The return benefits for the comptroller are the ability to promptly implement grant programs and the cost savings to the state by forgoing the extra procedures that would be required to identify and review additional applicants. The fiscal note further supports these benefits by acknowledging the proposed new rules would benefit the public by providing greater flexibility in broadband project funding while facilitating further access to and adoption of broadband service across the state. For example, the comptroller's office may enter into an agreement with a local governmental entity to deploy adequate middle-mile infrastructure in areas not previously served through earlier grant opportunities. Because competition is not always required under state law or guidance and because the added process implements recent legislation, the comptroller will provide for both processes.

The TCA notes that Government Code, §490I.0106(d)(2) and §490I.01062(a) may present conflicts for the award processes with a direct grant. The TCA requests clarification that any awards made under proposed §16.37 are subject to §16.35 regarding the prohibition on a political subdivision or other non-commercial broadband service providers being awarded a grant for last-mile broadband deployment if a commercial broadband service provider has previously submitted an application for the same location. The TCA also seems to suggest that Government Code, §490I.01062(a) requires a notice of funding availability be published for every award. The comptroller disagrees that a notice is always required when awarding funding or that the comptroller would not follow existing law regarding last-mile broadband infrastructure projects. The comptroller agrees with TCA that a notice of funding availability, specifically for broadband infrastructure, should include the preference to prioritize fiber optic facilities specified in §490I.01062(a). The comptroller appreciates the concerns provided by the TCA, but the comptroller will not make a change to the rule in response because the rule implements recent legislation authorizing direct awards that are not subject to an application process. The comptroller will continue to comply with all applicable rules and statutes that govern each award process.

The TCA proposes the challenge process should be extended for all broadband infrastructure projects and not limited to last-mile projects. The TCA requests changes to §16.41 to provide for middle-mile projects be reviewed in a challenge process to prevent duplicative access. This suggestion is contrary to the statute. The comptroller modifies §16.41 to align with recent statutory changes. Specifically, Government Code, §490I.0106(f) requires only applications for projects that directly fund last-mile broadband service to eligible broadband serviceable locations go through the challenge process. The comptroller notes the existing authority does not change the comptroller's ability to craft a notice of funding availability with requirements that ensure a proposed project complements any existing infrastructure. The comptroller appreciates the commenter's concerns but declines to make further changes to the amended rule.

The TCA requests the challenge process occur without regard to the number of served locations in a proposed project area because the current limitation appears arbitrary. The amended §16.41 limits the challenge process to only allow for contesting whether the location(s) to be served by a proposed project is eligible for funding. An interested party may submit a challenge to an application when the proposed project includes served locations that represent at least twenty percent of the total project locations. While the comptroller appreciates the commenter's concerns, the comptroller declines to make a change to the rule. This limitation on the challenge process complies with the statute and provides greater flexibility in broadband project funding opportunities while facilitating further access to and adoption of broadband service across the state.

The TTA provides comments and proposals for proposed §16.37 regarding direct contracts or grant awards. First, the TTA requests requiring statutory authorization or legislative appropriation for direct contract or grant awards on a non-competitive basis to political subdivisions to guaranty that such awards are deliberate legislative policy choices. Adding this requirement would be contrary to recent legislative amendments enacted by Senate Bill 1405, 89th Legislature, R.S., 2025. While the comptroller appreciates this recommendation, the comptroller declines to make this change. The addition of "contracts" in Government Code, §490I.0106 conforms with the comptroller's existing authority to enter into interagency and interlocal contracts with other governmental entities permitted under Government Code, Chapters 771 and 791. Further, the removal of "to applicants" from Government Code, §490I.0106(a), (a-1), (a-2) and (a-3) clarifies that the award process is not limited to a competitive application process. There is no need for further statutory authorization. Additionally, funds awarded from the BIF do not require further legislative appropriation as provided in Texas Constitution, article III, §49-d-16 and Government Code, §403.653. The proposal by TTA is unnecessary under current state law.

Alternatively, the TTA requests that direct awards to political subdivisions generally follow the same competitive process as other grant awards made by the comptroller to provide safeguards, transparency and for the state to receive the best possible price for services. This requirement would be contrary to recent legislative amendments. A competitive process is still available to utilize when appropriate but is not required for every award. "The addition of "contracts" in Government Code, §490I.0106 conforms with the comptroller's existing authority to enter into interagency and interlocal contracts with other governmental entities permitted under Government Code, Chapters 771 and 791. Further, the removal of "to applicants" from Government Code, §490I.0106(a), (a-1), (a-2) and (a-3) clarifies that the award process is not limited to a competitive application process. And, unlike private entities, local governments have the additional safeguard of governance that is accountable to the public through, for example, gubernatorial appointments subject to senate confirmation, or through elections. Because there is established state law and guidance in the Texas Procurement and Contract Management Guide, the existing guardrails are sufficient to protect transparency and trust in the process for direct contracts and awards.

The TTA proposes another alternative to modifying the proposed §16.37 by requiring a public notice and comment period for all direct awards for transparency and accountability. Existing authority still allows the comptroller to craft a notice of funding availability and other requirements for other broadband projects to ensure a proposed project complements any existing infrastructure. However, the statutory requirements for a posting period and comments applies only to accepted applications for competitive grants and does not apply to direct contracts with local government. When the legislature removed "to applicants" from Government Code, §490I.0106(a), (a-1), (a-2) and (a-3), the legislature did not remove "applicant" or "application" from Government Code, §490I.0106(e) or (f). The comptroller appreciates the commenter's concerns but declines to change the proposed rule.

The TTA's last request regarding §16.37 is to require direct contracts or grant awards have an applicable "claw back" provision to safeguard public funds, deter fraud and enable the reallocation of funds. The comptroller agrees with the commenter's concerns but declines to change the proposed rule. The contract or grant agreement is better suited to address detailed terms and conditions regarding receiving funds and what would trigger returning funds. Additionally, because the Texas Grant Management Standards and Texas Procurement and Contract Management Guide provide guidance regarding remedies for noncompliance, the comptroller is satisfied with the existing guardrails to ensure compliance with the terms and conditions of an award.

The TTA also proposed changes to §16.38 regarding fixed award amounts to provide transparency, prevent waste and abuse, ensure selection of the most meritorious recipient and ensure the program efficiently and effectively achieves broadband deployment goals. The TTA requests requiring fixed amount award recipients be limited to those that have been evaluated under the competitive grant process already outlined in the existing rules. While the comptroller appreciates the commenter's concerns, the comptroller declines to accept the requested change. The proposed change is not present in statute and could significantly limit the applicant pool for future awards or contracts. Further, the comptroller may continue to utilize its existing grant process framework as appropriate without an addition to the rule. As previously discussed, the rule implements recent legislation. Further, §16.37 limits use of the direct contract process to awards that are to local governments. Unlike private entities, local governments have the additional safeguard of governance that is accountable to the public through, for example, gubernatorial appointments subject to senate confirmation, or through elections. The comptroller will continue to comply with best practices as provided in the Texas Grant Management Guide, which includes additional guidance for the program on how best to provide for fixed amount awards while maintaining credibility and trust in the process.

The amendments are adopted under Government Code, §490I.0109, which permits the comptroller to adopt rules as necessary to implement Chapter 490I regarding the Texas Broadband Development Office.

The amendments implement Government Code, Chapter 490I.

§16.30. Definitions.

As used in this subchapter and in these rules, the following words and terms shall have the following meanings, unless the context clearly indicates otherwise:

(1) Applicant--A person that has submitted an application for an award under this subchapter.

(2) Broadband development map--The map adopted or created under Government Code, §490I.0105.

(3) Broadband service--Internet service that delivers transmission speeds capable of providing:

(A) a download speed of not less than 100 Mbps;

(B) an upload speed of not less than 20 Mbps; and

(C) network round-trip latency of less than or equal to 100 milliseconds based on the 95th percentile of speed measurements.

(4) Broadband serviceable location--A business or residential location in this state at which broadband service is, or can be, installed, including a community anchor institution.

(5) Census block--The smallest geographic area for which the U.S. Bureau of the Census collects and tabulates decennial census data as shown on the most recent on Census Bureau maps.

(6) Commercial broadband service provider--A broadband service provider engaged in business intended for profit, a telephone cooperative, an electric cooperative, or an electric utility that offers broadband service or middle-mile broadband service for a fare, fee, rate, charge, or other consideration.

(7) Community anchor institution--An entity such as a school, library, health clinic, health center, hospital or other medical provider, public safety entity, institution of higher education, public housing organization, or community support organization that facilitates greater use of broadband service by vulnerable populations, including, but not limited to, low-income individuals, unemployed individuals, children, the incarcerated, and aged individuals.

(8) Gigabit-level broadband service--Internet service that delivers transmission speeds capable of providing:

(A) a download speed of not less than 1000 Mbps;

(B) an upload speed of not less than 20 Mbps; and

(C) network round-trip latency of less than or equal to 100 milliseconds based on the 95th percentile of speed measurements.

(9) Grant funds--Grants, low-interest loans, and other financial incentives awarded to applicants under this subchapter for the purpose of expanding access to and adoption of broadband service.

(10) Grant recipient--An applicant who has been awarded grant funds under this subchapter.

(11) Interested party--A person, including an individual, corporation, organization, government or governmental subdivision or agency, business trust, estate, trust, partnership, association, or any other legal entity, that resides, is located, or conducts business in the project area subject to challenge. The term includes a broadband service provider that is not located in the project area but who proposes to provide broadband service in the project area.

(12) Mbps--Megabits per second.

(13) Middle mile infrastructure--Any broadband infrastructure that does not connect directly to an end-user location, including a community anchor institution. The term includes:

(A) leased dark fiber, interoffice transport, backhaul, carrier-neutral internet exchange facilities, carrier-neutral submarine cable landing stations, undersea cables, transport connectivity to data centers, special access transport, and other similar services; and

(B) wired or private wireless broadband infrastructure, including microwave capacity, radio tower access, and other services or infrastructure for a private wireless broadband network, such as towers, fiber, and microwave links.

(14) Non-commercial broadband service provider--A broadband service provider that is not a commercial broadband service provider.

(15) Office--The Broadband Development Office created under Government Code, §490I.0102.

(16) Project area--The area, consisting of one or more broadband serviceable locations, identified by an applicant in which the applicant proposes to deploy broadband service or middle mile infrastructure.

(17) Public school--A school that offers a course of instruction for students in one or more grades from prekindergarten through grade 12 and is operated by a governmental entity.

(18) Qualifying broadband service--Broadband service that meets the minimum speed, latency and reliability thresholds prescribed by the office in each applicable notice of funds availability.

(19) Reliable broadband service--Broadband service that is accessible to a location via:

(A) fiber-optic technology;

(B) Cable Modem/ Hybrid fiber-coaxial technology;

(D) terrestrial fixed wireless technology utilizing entirely licensed spectrum or using a hybrid of licensed and unlicensed spectrum.

(20) Served location--A broadband serviceable location that is neither an unserved nor an underserved location.

(21) Underserved location--A broadband serviceable location that has access to reliable broadband service but does not have access to reliable broadband service with the capability of providing:

(A) a download speed of not less than 100 Mbps;

(B) an upload speed of not less than 20 Mbps; and

(C) a network round-trip latency of less than or equal to 100 milliseconds based on the 95th percentile of speed measurements as established under Government Code, §490I.0101.

(22) Unserved location--A broadband serviceable location that:

(A) does not have access to reliable broadband service; or

(B) is a public school or community anchor institution and does not have access to reliable broadband service that is gigabit-level broadband service.

§16.31. Notice of Funds Availability.

(a) The office shall provide notice of the availability of funds for competitive grant awards and may publish the notice on the Electronic State Business Daily website or the comptroller's website.

(b) The notice of funds availability published under subsection (a) of this section shall include:

(1) the total amount of grant funds available for award;

(2) eligibility criteria;

(3) application requirements;

(4) award and evaluation criteria; and

(5) the date by which applications must be submitted to the office;

(1) limitations on the geographic distribution of grant funds;

(2) the anticipated date of award; and

(3) any other information the office determines is necessary for award.

§16.35. Competitive Grant Limitations.

(a) The office may not award grant funds for deployment of last-mile broadband service for a broadband serviceable location to a non-commercial broadband service provider if a commercial broadband service provider has submitted an eligible application for the same location.

(b) For the purposes of this subchapter, a joint application submitted by any combination of a political subdivision, commercial broadband service provider, or a non-commercial broadband service provider that includes at least one commercial broadband service provider shall be deemed to be an application submitted by a commercial broadband service provider.

§16.36. Competitive Grant Application Process Generally.

(a) No award for competitive grant funding will be disbursed by the office except pursuant to an application submitted in accordance with this subchapter.

(b) An application for competitive grant funding under this subchapter shall be submitted on the forms and in the manner prescribed by the office. The office may require that applications be submitted electronically.

(c) Prior to publication of application information pursuant to Government Code, §490I.0106(e), the office may undertake an examination to determine whether the application appears on its face to comply with applicable program requirements. The office may reject and take no further action on an application that does not appear to comply with applicable program requirements on its face.

(d) The office shall for a period of at least 30 days publish on its website information from each accepted application, including the applicant's name, the project area targeted for expanded broadband service access or adoption by the application, and any other information the office considers relevant or necessary. The information will remain on the website for a period of at least 30 days before the office makes a decision on the application.

(e) During the 30-day application publishing period described by subsection (d) of this section, the office shall accept from any interested party a written protest of the application relating to whether the applicant or project is eligible for an award or should not receive an award based on the criteria prescribed by the office. A protest of an application must be submitted as provided under §16.41 of this subchapter.

(f) After the publishing period in subsection (d) of this section and any challenge process under §16.41 of this subchapter, the office will notify grant recipient(s).

(g) During the application review process, the office may require an applicant to submit additional information the office determines is necessary to make an award decision.

§16.37. Direct Contract or Grant Awards.

(a) The office may make a direct contract or grant award on a non-competitive basis to a political subdivision of this state.

(b) No award for direct funding will be disbursed by the office except pursuant to a contract or grant agreement executed in accordance with this subchapter. The office may require that information regarding the award be submitted electronically.

§16.38. Fixed Amount Awards.

(a) For the purposes of this subchapter, a fixed amount award is a type of grant agreement pursuant to which the office provides a specific amount of funding based on reasonable, estimated costs under the award.

(b) Pursuant to Government Code, §783.007(b) allowing for variances from the uniform assurances and standard financial conditions, the office may determine the amount per award and provide a fixed amount award for competitive and direct grants without regard to the Texas Acquisition Threshold as defined in the Texas Grant Management Standards. All other uniform assurances and standard financial conditions developed pursuant to Government Code, § 783.006 remain applicable to local governments receiving financial assistance from the office.

§16.40. Evaluation Criteria.

(a) The office shall establish the eligibility and award criteria applicable for each round of competitive grant funding by publishing the criteria in a notice of funds availability as provided by §16.31 of this subchapter. In establishing eligibility and award criteria, the office shall:

(1) prioritize applications that expand access to and adoption of broadband service in designated areas in which the highest percentage of broadband serviceable locations are unserved or underserved locations;

(2) prioritize applications that expand access to broadband service in public and private primary and secondary schools and institutions of higher education;

(3) prioritize applications that connect end-user locations with end-to-end fiber optic facilities that meet speed, latency, reliability, consistency, scalability, and related criteria as the office shall determine;

(4) give preference to applicants that provide the information requested by the office under Government Code, §490I.01061; and

(5) take into consideration whether an applicant has forfeited federal funding for defaulting on a project to deploy qualifying broadband service.

(b) In addition to the evaluation criteria provided under subsection (a) of this section, the office may include and provide preferences for the following evaluation criteria in the notice of funds availability:

(1) application participant(s) experience;

(2) technical specifications including broadband transmission speeds (Mbps upload and download) that will be deployed as a result of the project;

(3) estimated project completion date;

(4) the availability of matching funds including amount, percentage, and source of matching funds;

(5) cost effectiveness and overall impact as measured by the total project cost, the total number of prospective broadband service locations to be served by the project, the proportion of unserved and underserved locations to be served by the project compared to the number of serviceable locations within the designated area(s) the project is located, the proportion of recipients to be served by the project compared to the population of the designated area(s) in which the project is located, and the project cost per prospective broadband service recipient;

(6) geographic location including, but not limited to, rural areas where because of population density the cost of broadband expansion is characterized by disproportionately high capital and operational costs;

(7) community, non-profit, or cooperative support or participation in the project;

(8) affordability of broadband services in the areas in which the proposed project is located prior to the deployment of broadband services as a result of the project;

(9) consumer price of broadband services that applicant proposes to deploy as a result of the project;

(10) participation in federal programs that provide low-income consumers with subsidies for broadband services;

(11) small business and historically underutilized business involvement or subcontracting participation; and

(12) any additional factors the office may determine are necessary to further the expansion and adoption of broadband service.

(c) Notwithstanding subsection (a)(3) of this section, the office may consider an application for a broadband infrastructure project that does not employ end-to-end fiber optic facilities if the use of an alternative technology:

(1) is proposed for a high-cost area;

(2) may be deployed at a lower cost than deploying fiber optic technology; or

(3) meets the speed, latency, reliability, consistency, scalability, and related criteria as the office shall determine for each applicable notice of funds availability.

§16.41. Application Challenge Process.

(a) The office shall publish on the office's website criteria and requirements for submitting a challenge under this section for applications related to last-mile broadband infrastructure projects. An interested party may only challenge an application on the basis that the application includes broadband serviceable locations that are ineligible for an award. The inclusion of a location in a project may only be challenged if:

(1) the number of served locations included in a proposed project exceeds twenty percent of the total number of locations to which service would be deployed by the project; or

(2) the broadband serviceable location is subject to an existing federal commitment to deploy qualifying broadband service to the location.

(b) A challenge submitted under this section shall be submitted electronically in the manner and on the forms prescribed by the office and shall be accompanied by all relevant supporting documentation. The interested party submitting the challenge bears the burden to establish that a location is ineligible for an award.

(c) The office shall review the protest and make a determination as to whether the protest should be upheld. The office shall provide notice of its determination to each affected applicant, including the right, if any, to submit an amended application under subsection (d) of this section.

(d) If the office upholds a challenge on the basis prescribed by the office, an applicant may amend and resubmit an application without the challenged locations and re-scope the application or project area if, after the protest is upheld:

(1) the remaining number of broadband serviceable locations in the project area is greater than 50% of the original number of locations in the project area; or

(2) the office permits, at its sole discretion, the applicant to amend the application.

(e) If an amended application without the challenged locations is not received by the office by the 30th day after receiving notice of the determination under subsection (c) of this section, the office may remove the application from grant funding consideration.

(f) A determination made by the office under this section is not a contested case for purposes of Government Code, Chapter 2001.

(g) Notwithstanding any deadline for submitting an application, if the office upholds a challenge, the applicant may resubmit an amended application as provided under this subchapter without the challenged broadband serviceable locations not later than 30 days after the date that the office upheld the protest. An amended application may not include additional areas or broadband serviceable locations not already included in the original application.

(h) If the office upholds a challenge and the applicant resubmits an application in accordance with subsection (g) of this section, the resubmitted application is not subject to further challenges.

(i) Notwithstanding section §16.36(e) of this subchapter, a broadband service provider who has not provided information requested by the office under Government Code, §490I.01061, may not submit a challenge of an application made under this subchapter.

§16.42. Awards; Grant Agreement.

(a) All award decisions shall be made at the sole discretion of the office and are not appealable or subject to protest.

(b) Grants for the deployment of broadband infrastructure awarded under this subchapter may only be used for capital expenses, purchase or lease of property, and other expenses, including backhaul and transport, that will facilitate the provision or adoption of broadband service.

(c) A grant recipient shall have 30 days from the date of award to negotiate and sign the grant agreement. The comptroller may extend the deadline to fully execute the grant agreement upon a showing of good cause by the grant recipient(s). If the grant agreement is not signed by the grant recipient and received by the office by the later of the 30th day after the award of the grant agreement or the extended deadline date, the office may rescind the award.

(d) For last-mile infrastructure projects, the grant recipient must make a reasonable effort to restore the private property affected by the project to the condition the property was in before the beginning of the project.

§16.46. Forms; Notices.

(a) Unless otherwise required by law, the office may prescribe all forms or other documents required to implement this subchapter and may require that the forms or other documents be submitted electronically.

(b) Any notice required by these rules to be sent by the office may be provided electronically and the office is entitled to rely on an email address provided by an applicant, grant recipient or other person, including a political subdivision or broadband service provider, for all purposes relating to notification. Applicants and grant recipients must provide an email address that is designated for receipt of notices from the office.

(c) If notice cannot be sent electronically, the office shall provide notice by regular or certified U.S. Mail and the office is entitled to rely on the mailing address currently on file for all purposes relating to notification.

(d) Service of notice by the office is complete and receipt is presumed on:

(1) the date the notice is sent, if sent before 5:00 p.m. by electronic mail;

(2) the date after the notice is sent, if sent after 5:00 p.m. by electronic mail; or

(3) three business days after the date it is placed in the mail, if sent by regular or certified U.S. Mail.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 25, 2026.

TRD-202600919

Victoria North

General Counsel for Fiscal and Agency Affairs

Comptroller of Public Accounts

Effective date: March 17, 2026

Proposal publication date: November 21, 2025

For further information, please call: (512) 475-2220

34 TAC §§16.37 - 16.39

The Comptroller of Public Accounts adopts the repeal §16.37, concerning overlapping applications or project areas, §16.38, concerning special rule for overlapping project areas in noncommercial applications, and §16.39, concerning application requirements, without changes to the proposed text as published in the November 21, 2025, issue of the Texas Register (50 TexReg 7519). The rules will not be republished.

The comptroller repeals §§16.37 - 16.39 since they are no longer needed as information related to application requirements will be in each respective notice of funds availability.

The comptroller did not receive any comments regarding adoption of the repeal.

The repeal is adopted under Government Code, §490I.0109, which permits the comptroller to adopt rules as necessary to implement Chapter 490I regarding the Texas Broadband Development Office.

The repeal implements Government Code, Chapter 490I.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 25, 2026.

TRD-202600918

Victoria North

General Counsel for Fiscal and Agency Affairs

Comptroller of Public Accounts

Effective date: March 17, 2026

Proposal publication date: November 21, 2025

For further information, please call: (512) 475-2220

SUBCHAPTER F. RURAL AMBULANCE SERVICE GRANT PROGRAM

34 TAC §§16.500 - 16.506

The Comptroller of Public Accounts adopts new §16.500, concerning definitions; §16.501, concerning applications; §16.502, concerning comptroller review; §16.503, concerning grant agreement; §16.504, concerning authorized uses of grant funds; §16.505, concerning reporting and compliance; and §16.506, concerning fiscal year 2026 application period, without changes to the proposed text as published in the November 21, 2025, issue of the Texas Register (50 TexReg 7519). The rules will not be republished. These new sections will be located in 34 Texas Administrative Code, Chapter 16, new Subchapter F, Rural Ambulance Service Grant Program.

Section 16.500 provides definitions.

Section 16.501 describes the application process.

Section 16.502 describes comptroller review.

Section 16.503 describes the requirements for grant agreements.

Section 16.504 describes the authorized uses of grant funds and limitations on uses of grant funds.

Section 16.505 describes reporting requirements and available remedies for noncompliance.

Section 16.506 describes the Fiscal Year 2026 application period.

The comptroller received comments from eight entities, including four associations: Texas State Association of Fire and Emergency Districts ("SAFE-D"), Texas Ambulance Association ("TAA"), Texas EMS Alliance ("TEMSA"), and County Judges and Commissioners Association of Texas ("CJCAT")). Karnes County Emergency Medical Services ("Karnes County EMS"), Delta County, Camp County Emergency Medical Services ("Camp County EMS"), and Wilson County Emergency Services District ("Wilson ESD") also submitted comments on the proposal.

The comptroller thanks every commenter for the suggestions, information, and arguments. This office appreciates the time and resources devoted to drafting and submitting the written comments.

Karnes County EMS requests changing the allowable date for ordering an ambulance. If a county's ambulance service provider has an order on file with a manufacturer at the time the application was submitted, and the delivery and payment occur after the award date, Karnes County EMS proposes allowing the grantee to utilize grant funds on that order. Karnes County EMS and other commenters shared their frustration with the significant delays in delivery times by ambulance manufacturers and how best to guarantee their place in the production queue at the best price. Some commenters argued the disallowance of pre-award expenses is not statutorily authorized and conflicts with legislative intent. One commenter acknowledged a pre-award order would be at the county's own risk. SAFE-D, TAA, TEMSA and Delta County also request amending the ambulance ordering date allowed by the proposed rule. These organizations suggest qualified counties be able to place ambulance orders immediately upon receiving their grant award notices to prevent unnecessary delay in the delivery of the ambulance. TAA, TEMSA and CJCAT alternatively request a change to allow qualified counties to place ambulance orders on or after January 1, 2026, and later utilize grant funds for these orders. For the sake of this discussion, the comptroller assumes an order on file with a manufacturer requires a contract. Grant funding is not guaranteed in part because the statute limits providers to receive funds from only one county per fiscal year and the appropriation is not unlimited. For example, in some areas, up to six counties may share a single provider. If all six counties apply, only one can receive a grant in each fiscal year. In this scenario, at least one county would wait at least six years to receive a grant. Further, grant funds will be disbursed quickly, but not without an executed grant agreement between the comptroller and the county and, for counties with private providers, not until their executed agreement with the provider is submitted to our office. While the comptroller appreciates the commenters' concerns, the comptroller declines to make the proposed change because it would create risk and reduce the efficiency of program administration. Orders placed, i.e. purchase contracts signed, before execution of the grant agreement and fulfilment of its contingencies are pre-award expenses. The comptroller disagrees that disallowance of pre-award expenses conflicts with or exceeds statutory authority. In order to efficiently operate the program with statutorily required controls to ensure the public purpose is accomplished, the comptroller declines to amend §16.504(c), which disallows pre-award expenses.

TAA, TEMSA and Delta County also request that the rules provided that the comptroller distribute funding 30 to 45 days after the ambulance is ordered. TAA and TEMSA further recommend requiring that the county submit documentation regarding the order. Because the documentation provides appropriate fiscal oversight, the commenters argue this option gives the county what it needs to secure a place in the manufacturing queues. While the comptroller appreciates the commenters' concerns to receive funds timely, the comptroller declines to make the proposed change. After executing the grant agreement and, if applicable, submitting an executed private provider agreement, the comptroller will distribute grant funds to the grantee in accordance with §16.503 and Local Government Code, §130.914(h). The comptroller notes that the sample required documents (e.g. purchase agreements, documentation detailing the ordered vehicle specifications, progress reports on manufacturing status and final invoicing upon delivery) suggested by the commenters for qualified counties to provide the comptroller are reasonable examples that a grantee could be expected to produce to confirm compliance with the grant requirements.

Camp County EMS comments that it is concerned about significant delays in ambulance acquisition and capacity if qualified counties must wait or are denied funding in a scenario where qualified counties name the same qualified rural ambulance service provider. TAA, TEMSA, Delta County and CJCAT share similar concerns about this potential outcome from the proposed rules: If multiple qualified counties list the same qualified rural ambulance service provider in their application, only one qualified county may be awarded a grant for that fiscal year for that shared qualified rural ambulance service provider. The commenters request that qualified counties receive funding without regard to the partnering qualified rural ambulance service provider. While the comptroller appreciates the concerns, this request conflicts with Local Government Code, §130.914(c) that prevents providers from receiving grant funds through more than one county in a fiscal year. The statute requires evaluations that prevent immediate funding after applications are submitted. Grant funding cannot be guaranteed because the statute requires the comptroller to evaluate each county's capability to otherwise obtain the money necessary to provide adequate ground ambulance services, prevents a provider from receiving funding from another qualified county in the same fiscal year and does not provide for unlimited funding. The proposed rules allow the comptroller to ensure compliance with state law as the comptroller reviews and processes all applications prior to awarding the funding. Therefore, the recommended revision provided is respectfully declined.

CJCAT, SAFE-D, TEMSA, and TAA disagree with requiring a county to allocate the entire award to one provider and requests amending the proposed rules to allow qualified counties to distribute the funds among multiple eligible qualified ambulance service providers. Commenters cite legislative intent, disparities between counties with one provider and several providers, the desire to benefit all EMS agencies that serve a county and desire to provide equitable services across a county. The limitation to one provider per county per fiscal year is supported by the statute's requirement for sufficient controls. The limit to one provider simplifies grant administration not only for this office, but also for small rural counties who have very few employees, and may not have a dedicated staff grant compliance expert. Based on our office's experience with other grant programs, smaller counties have more incidence of disallowed expenditures. Because clawing back misspent funds is a great burden for small counties, the best mechanism to ensure grant compliance is prevention. Commenters asking to divide limited grant funds among multiple providers indicate possible misunderstandings of allowable grant uses. Statute limits the use of grant funds to the purchase of ambulances. After consulting Department of State Health Services experts, the proposed rules include refurbishing as a mechanism for purchase. Many counties elect to refurbish an ambulance by purchasing a new 'box' to place on an existing chassis, or by purchasing a new chassis to transport an existing 'box.' The high costs of new ambulances and new boxes or chassis will likely exceed grant amounts. Dividing funds among multiple providers could signal an intent to use funds for something less than new ambulances or refurbishments. Some commenters argued they could support dividing grant funds among multiple providers by adding their own funds. While the county still needs to demonstrate their inability to otherwise obtain the funds necessary to provide adequate ground ambulance service to receive the grant, the county could provide grant funds to one provider and provide the county's own funds to the other. This rule also provides controls to ensure compliance with Local Government Code, §130.914(c) that states a qualified rural ambulance service provider is ineligible to receive additional grant funds under the grant program from another qualified county in the same fiscal year. The comptroller oversees compliance with state statute as the comptroller reviews and processes all applications prior to awarding the funding. Therefore, the recommended revision is respectfully declined.

Wilson ESD suggests qualified ambulance service providers could demonstrate their ability to provide matching funds to complete the ambulance purchase if the grant will not cover the full vehicle purchase amount. Wilson ESD further proposes granting qualified counties the ability to elect to split grant funds between two selected qualified rural ambulance service providers on application if the providers demonstrated matching funds to complete the respective ambulance purchases. The comptroller finds that these requested additions are outside the scope of the proposed rulemakings and would materially alter the issues raised in the proposed rules. Such an adoption would deprive affected parties of fair notice and the opportunity for meaningful and informed participation in the rulemaking process. See Tex. Workers' Comp. Comm'n v. Patient Advocates, 136 S.W.3d 643 (Tex. 2004). The comptroller declines to change the rules in response to these comments.

SAFE-D requests adding a definition for "grant period" that would be for at least five years from the date the county received the grant funds. The comptroller declines to add a definition for "grant period" in the rule because the statute provides grantees five years to purchase and take possession of an ambulance, and because the grant agreement is the most appropriate means to implement this statutory requirement.

The new sections are adopted under Local Government Code, §130.914, which requires the comptroller to adopt rules to implement a new grant program to provide financial assistance to certain rural counties for ambulance service.

The new sections implement Local Government Code, §130.914.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on February 26, 2026.

TRD-202600996

Victoria North

General Counsel for Fiscal and Agency Affairs

Comptroller of Public Accounts

Effective date: March 18, 2026

Proposal publication date: November 21, 2025

For further information, please call: (512) 475-2220