As of December 1995, at least 28 federal programs administered by 15 federal agencies provided funds that either were specifically designated for telecommunications projects in rural areas or could be used for that purpose. Interviews with community leaders and rural development experts identified specific actions that must be taken to lay the foundation for establishing rural telecommunications projects. Communities should develop an understanding of telecommunications technologies and their potential benefits; engage in long-term planning to determine the feasibility of their project; and build partnerships among federal and state officials, telephone carriers, utilities, Internet providers, and potential beneficiaries such as hospitals and schools. Federal telecommunications programs need to change in several areas: (1) educating rural communities on the potential benefits of telecommunications technologies, (2) building in requirements for considering telecommunications technologies in long-range planning, and (3) making the multiple federal programs easier to use. The planning and coordination aspects of the Federal Agriculture Improvement and Reform Act of 1996, as well as changes to strategic planning guidelines contemplated by the Economic Development Administration, should help address these problems. Appendices include the 28 federal programs that fund telecommunications projects, detailed descriptions of 5 telecommunications projects in rural areas, and 5 national organizations representing rural areas. (TD)