(a)

1. (1) As project capital costs and net income after deployment are calculated and local funding sources are identified, project organizers shall consider the size of the state grant that will be needed to make the project acceptable to all parties and arrive at a decision before applying.

2. (2)

   1. (A) As general guidance for project organizers in setting the state grant request, ARC seeks to make, for each project, the minimum state grant needed to close the business case and make all stakeholders willing to participate.
   2. (B) But the Arkansas Department of Commerce Broadband Office will not attempt to verify whether the state grants requested actually correspond to this minimum, relying instead on the competitive character of the overall grantmaking process to discipline the size of grant requests.
3. (3) While the project narrative provided with the application shall include at least a brief description of how the state grant request was set, and obvious improprieties might potentially be disqualifying, project organizers may exercise considerable discretion.

(b)

1. (1) Project organizers shall estimate the number of currently unserved households living in the target municipality, unincorporated community, or county that will receive broadband coverage as a result of the project.

2. (2)

   1. (A) This number of households should then be multiplied by three thousand dollars ($3,000), yielding the maximum state grant that can be applied for by the target community.
   2. (B) Also, ARC grant requests cannot exceed the maximum of two million dollars ($2,000,000) or twenty percent (20%) of the total funding available for a round.
3. (3) If the state grant deemed necessary to make the project viable is greater than the relevant maximum, project organizers may either look for other funding sources or abandon the project.