FCC Publishes E-rate Modernization Report and Order

The FCC’s Modernization of the E-rate program will impact your E-rate discounts in many ways, both positive and negative.  

The Good:  Funds for in-house network equipment and maintenance will be available – perhaps for all applicants – over the next five years.

The Bad:  A number of services will become ineligible for funding (such as wireless data plans, email, webhosting).  Discounts on all voice services will be phased out over the next few years.

The Ugly:  Rules will change regarding discounts, application reviews, bids, what you can spend equipment and maintenance, and a number of other things – all to SIMPLIFY the E-rate process.

We’ll do our best to fill you in on what it all means.  Check out these topics – more to come:

  • FCC’s E-rate Modernization Order
  • The Big Change – Category 1 and Category 2
    • Category 1
    • Category 2
  • Notice of Proposed Rulemaking – the FCC wants YOU!
  • Eligible Services List for FY 2015
  • Cellular Service (Voice and Data),  Aircards, Mobile Hotspots

Questions?   If you have questions, please email them to us:


FCC’s E-rate Modernization Order

On 7/23/14, the FCC Commissioners published the Report and Order “Modernizing the E-rate Program for Schools and Libraries” (available from the FCC’s website)  The Report and Order not only details the many changes to the E-rate system, it also requests further questions and comments on several issues not yet agreed upon by the Commissioners.

Below is an outline of the changes to the E-rate program.  We will be studying the details and will be posting information on those details in the coming weeks.  We will focus initially on changes that will impact your fiscal and technology planning; after that we will focus on changes to the Form 470/471 cycle and then focus on changes to the post-funding commitment processes.

Although it contains significant changes, the outlined E-rate process still looks much like the current one:

  • Planning (but Tech Plans may be removed from the requirements)
  • Bidding and evaluation
  • Funding application
  • Post commitment actions

 The Big Change – Category 1 and Category 2:  The E-rate program will now change focus to support broadband access for all students and library patrons.  It is unlikely that any additional funds will be added to the $2.4 billion currently allocated to E-rate, so this broadband access support is being accomplished by reconfiguring the services supported by E-rate.  This reconfiguration will impact on your technical and fiscal planning.  The reconfiguration centers around restructuring of “Priority 1 and 2” services into “Category 1 and 2.”

 Category 1:

  1. The 5-year goal is to have Category 1 provide funding exclusively for broadband Internet Access and Wide Area Network (WAN) or Last-Mile service.
  2. Ineligible for FY 2015:  Some services will be declared Ineligible for E-rate funding starting with FY 2015:
    • web hosting
    • email
    • voice mail
    • directory assistance charges
    • text messaging
    • custom calling services
    • direct inward dialing (DID)
    • 900/976 call blocking
    • inside wire maintenance plans
    • distance learning/video conferencing services
    • paging
    • domain name registration services
  3. Starting in FY2015, Category 1 will be divided into Voice Services and Broadband Connectivity. 
  • Voice Services will be phased out over a maximum of 5 years via annual reduction of  E-rate discounts for these services.
    • Phase-out to be accomplished by discount reduction:  Your discount for these services will be lowered by 20% per year starting in FY 2015 (e.g.:  for a school with a discount percentage of 80%, FY 2015 will be reduced to a 60% discount, FY 2016 will be 40%, FY 2017 will be 20%, FY 2018 will be 0%.)
    • Voice Services includes the following services:
      • local phone service
      • long distance service
      • plain old telephone service (POTS)
      • interconnected VoIP service (but possibly not the broadband internet connection)
      • 800 service
      • satellite telephone
      • shared telephone service
      • Centrex
      • wireless telephone service such as cellular service
      • radio loop
  • Broadband Connectivity will include wide area network services and ISP costs. These services will continue to be funded in the same manner as they are at present.  The targets which define broadband are:
    • Internet Access: 
      • For schools, at least 100 Mbps per 1,000 students and staff users in the short term and 1 Gbps Internet access per 1,000 users in the longer term (5 years?).
      • For libraries, those that serve fewer than 50,000 people – at least 100 Mbps; libraries that serve 50,000 people or more – at least 1 Gbps.
    • WAN: 
      • For schools, a dedicated data service scalable to a long-term WAN target of 10 Gbps per 1,000 students.
      • For libraries, WAN targets have not been set at this time.

Category 2:

  1. Will consist of Internal Connections and Basic Maintenance; Managed WiFi will also be a new eligible service included in Category 2.
  2. Category 2 Funds:  The FCC will allocate $1 billion of Cat 2 funding each year for FYs 2015 and 2016.  If the process works well enough and additional funding can be located, $1 billion will be allocated to Cat 2 each year for FYs 2017, 2018, and 2019.  This second phase should provide Cat 2 funds for medium- and low-discount applicants – if it is done at all.
  3. Eligible products and services will focus on WiFi access including access points and the Local Area Networks (LANs) within each facility.  This will result in a significant trimming of the Eligible Service List.
  4. Five-year funding plan – FYs 2015, 2016, 2017, 2018, and 2019:
  • You will be allotted a specific amount to spend (Pre Discount) on eligible Category 2 products and services during that 5-year period:
    • Schools:  Total of $150/student for the 5-year period with a pre-discount floor of $9,200 per facility.
    • Libraries:  Total of $2.30/square foot for the 5-year period with a pre-discount floor of $9,200 per facility.
  • Schools presently eligible for 90% discount will be reduced to 85%; all other discount levels will be the same as they are now.


Notice of Proposed Rulemaking – the FCC wants YOU!

This is not the end of the Modernization process.  The FCC will also be seeking input from the public on several issues with the intent of issuing another Order.  The topics are:

  • Meeting Future Funding Needs
  • Ensuring That Multi-Year Contracts Are Efficient
  • Standardizing the Collection of NSLP Data
  • Encouraging Consortium Participation
  • Ensuring Support for Libraries is Sufficient

Information on filing comments are available in the Modernization Report and Order in paragraphs 301 through 311.  The deadline for filing comments is 9/15/14.

Eligible Services List for FY 2015:

On 8/5/14, the FCC Commissioners published the DRAFT of the ESL (Eligible Services List) with a six-page cover letter describing the list’s contents and requesting comments from the public (available from the FCC ’s website).  The ESL is radically different from prior years – for starters, the list itself is six pages vs. last year’s 49 page document.  And it is truly a list, or series of lists, with most of the supporting sections and descriptive verbiage stripped away.  So the good news is that the Modernized ESL is simpler, but this could be the bad news as well. 

Here’s what it contains:

  • A few paragraphs describing the new Category One and Two system.
  • For Category One (two pages):
    • A general description of what Category One contains.
    • A half-page list of “Eligible data transmission services and Internet access
    • A short list of “Eligible voice services
    • A half-page of descriptions of limitations on Fiber, Internet Access, and Wireless Services.
  • For Category Two (a bit more than two pages):
    • A general description of what Category Two contains.
    • A list of “Eligible Broadband Internal Connections Components
    • A paragraph describing the limitations on broadband internal connections.
    • A half-page description of “Eligible Managed Internal Broadband Services” and their limitations.
    • A short description of “Basic Maintenance of Eligible Broadband Internal Connections Components” and its limitations.
  • A page of descriptions of two Miscellaneous items:  “Fees” and “Installation, activation, and initial configuration”.

 That’s it – shorter by a lot, but is some vital information missing?

  • no list of ineligible services (“if it ain’t listed it’s ineligible“; USAC says that describing the complexities of ineligible services is too confusing so they won’t do it),
  • no description of related program requirements (but no explanation of where to find this information),
  • no extra information regarding components of complex services such as digital transmission service, distance learning, video, interactive television, and voice or video conferencing (seemingly because they are too complex for the ESL, but no alternative information source is mentioned),
  • no description of “Special Eligibility Conditions” (because they are already contained somewhere in the FCC;s rules, orders, etc.),
  • no glossary of the various services and terms.  This will be moved to the SLD website as a reference tool (good!) which is unfortunately described as “just for informal guidance” (not very encouraging).

Regretfully, it seems that little has been done to eliminate the complexity of the eligible services, and the FCC has opted to duck the issues as much as it has actually simplified them.  We will do our best to fill in the missing information, either on this section of our website or by personally answering your questions.  We will look into the details of the ESL as well as other aspects of the Modernization. 

Cellular Service (Voice and Data),  Aircards, Mobile Hotspots:

These services are of particular concern to us all:

  • Cellular voice is on the list of services to be phased out by reducing the discount 20% per year.
  • Text messaging is ineligible as of FY 2015.
  • Cellular data plans, air cards, and mobile hotspots are ineligible as of FY 2015 UNLESS they are:
    • Used on-campus (off-campus use, even if used for an educational purpose, is ineligible for support).  Nothing new – this has been the rule for a while now.
    • Cost effective versus a wireless local area network (WLAN) within the school.  Since this is rarely the case, expect a tough Cost Effectiveness Review if you request any of these services. 
    • If you do not have a WLAN, you may have to consider installing one versus using a wireless data plan.  CATCH 22: If your district/school/library does not have at least an 80% discount, you may not get funding for a new WLAN in FYs 2015 or 2016 – and then maybe not at all.

Bundled Plans:   If you have a wireless plan that bundles data or text messaging with voice, you must require your provider to cost allocate the ineligible data or text messaging costs.  If you cannot allocate out these ineligible costs, the entire plan will be declared ineligible and you will lose e-rate funding on the whole plan.

Existing multi-year plans

  • May be stripped of much of their funding as of FY 2015 by having data and text services removed from E-rate funding and having funding for the remaining voice services reduced year-by-year. 
  • Wireless data plans will not be Grandfathered – their funding will be denied as of FY 2015 unless they meet the on-campus and cost-effectiveness criteria.

You may need to review your cell, smartphone, and air card policies and schedule a conversation with your service provider soon NOW.


SLD News – 7/25/14 – Focus: E-rate Moderization; Service Provider Form 498

Commitments for Funding Years 2014 and 2013

Funding Year 2014. USAC will release Funding Year (FY) 2014 Wave 12 Funding Commitment Decision Letters (FCDLs) on July 30. This wave includes commitments for approved Priority 1 (Telecommunications Services and Internet Access) requests at all discount levels. As of July 25, FY2014 commitments total over $1.58 billion.

Funding Year 2013. USAC will release FY2013 Wave 60 FCDLs on July 31. This wave includes commitments for approved Priority 1 requests at all discount levels. As of July 25, FY2013 commitments total over $2.08 billion.

On the day the FCDLs are mailed, you can check to see if you have a commitment by using USAC’s Automated Search of Commitments tool.

FCC Releases E-rate Modernization Order

On July 23, the FCC released the E-rate Modernization Order (FCC 14-99), a copy of which can be found here.

SERVICE PROVIDERS: How to Update Information on FCC Form 498

Service providers certify an FCC Form 498 to receive a Service Provider Identification Number (SPIN) when they begin to participate in one or more of the four Universal Service Fund (USF) programs: High Cost, Low Income, Rural Health Care, and Schools and Libraries. However, this form also allows service providers to update their information when it changes or to provide new information when it is required.

Here are some tips for updating your FCC Form 498:

Prepare or file your form online.

The first time you file FCC Form 498, USAC will send a UserID and Password to the General Contact and Company Officer on the form, which they can use to log in to USAC’s E-File System. (Note: if you filed your first FCC Form 498 before October 2005 and have never filed an update, you do not have online access and will have to file on paper.) The E-File System gives you access to a number of useful tools, and also provides a mechanism to easily file updates to FCC Form 498 online.

The online system not only guides you through the process, but will compare certain information and let you know if your entries are inconsistent. For example, the system will check:

  • Your Federal Employer Identification Number (FEIN) and your 499 Filer ID, if you have these numbers, and let you know if there is a mismatch or populate the 499 Filer ID if you have forgotten to do so.
  • Your FCC Registration Number (CORES ID) – If you have this number, the E-File System will let you know. If you provide a number and the number does not match with the number in our records, the system will provide you with the correct number.
  • Your bank routing number and the list of valid bank routing numbers from the Federal Reserve – Again, the system will let you know if the number you provided does not appear on the list.

Note that your General Contact (Block 2 of FCC Form 498) can submit but not certify changes to the form. If changes are submitted, the Company Officer (Block 15) will receive an email notification that the changes are ready for certification. The form changes are not complete until the Company Officer has certified them.

Remember too that forms filed online are posted the same day. Forms filed on paper take longer to process (see below).

Be prepared to provide all required information.

If you have not updated your FCC Form 498 recently, you may notice some required fields that are new to you. Here are a few examples:

  • A Dun and Bradstreet (D&B D-U-N-S or DUNS) Number, which is an industry standard for keeping track of the world’s businesses. If you don’t already have one, you can request a DUNS number or a DUNS number for government purposes for free.
  • FCC Registration Number (CORES ID), a number assigned by the Federal Communications Commission. If you don’t have an FCC Registration Number, you can request one on the FCC Registration web page.
  • Study Area Codes (SACs). If you participate in the High Cost and/or Low Income programs, these codes are necessary to establish the appropriate relationship between them and your SPIN.

If you file on paper, use the online system to complete your paper form.

As we have discussed above, the online system provides suggestions and error messages to guide you through the completion of your form. If you are filing on paper, you can still take advantage of these helpful messages by completing the form online, printing a copy, and mailing it to USAC.

However, keep the following in mind:

  • Processing paper takes time. We ask that you allow seven to 10 days for a paper form to be processed.
  • About half of the paper FCC Forms 498 submitted contain errors. We cannot complete processing a paper form until all errors have been corrected.

Monitor your email.

We use email notifications when processing your FCC Form 498. It is your responsibility to respond quickly and accurately to any emails from USAC. For example:

  • If we find an error on your FCC Form 498, we will send you an email telling you what the error is and how to correct it.
  • If the General Contact submits an FCC Form 498 online, we will send an email to the Company Officer identified in our records to notify him or her that the form is ready to be certified.

NOTE: Keeping your FCC Form 498 updated with the latest contact information is critical to receiving important feedback and information from USAC about your form processing and disbursements.

Call or email us if you have questions.

If you are having difficulty filing a form or you have other questions, you can:

Call us at 1-888-641-8722. We are open from 9:30 am – 4:30 pm EDT Monday through Friday. If you leave a voicemail message outside of these hours, we will call you back the next business day.


SLD News – 7/18/14 – Focus: E-rate Modernization Order Section Added to USAC Website

On July 11, the Federal Communications Commission adopted the E-rate Modernization Order that will expand Wi-Fi networks in schools and libraries across America while ensuring that support continues for broadband connectivity. USAC has created a separate section of its website devoted exclusively to this Report and Order. We suggest that you check this section and the other pages relating to the E-rate program often for any newly released documents relating to the Report and Order and for updates to existing ones.

TIP OF THE WEEK: If you are filing an appeal with USAC, be sure to review last week’s SL News Brief for the information you should include in your appeal. Appeals that are missing important details – such as complete and current contact information, the specific decision being appealed, or relevant documentation – are more difficult for USAC to process.

Commitments for Funding Years 2014, 2013, and 2012

Funding Year 2014. USAC will release Funding Year (FY) 2014 Wave 11 Funding Commitment Decision Letters (FCDLs) on July 23. This wave includes commitments for approved Priority 1 (Telecommunications Services and Internet Access) requests at all discount levels. As of July 18, FY2014 commitments total just under $1.52 billion.

Funding Year 2013. USAC will release FY2013 Wave 58 FCDLs on July 22 and Wave 59 FCDLs on July 24. This wave includes commitments for approved Priority 1 requests at all discount levels. As of July 18, FY2013 commitments total over $2.08 billion.

Funding Year 2012. USAC will release FY2012 Wave 88 FCDLs on July 25. This wave includes commitments for approved Priority 2 (Internal Connections and Basic Maintenance) requests at 90 percent and denials at 89 percent and below. As of July 18, FY2012 commitments total just under $2.86 billion.

On the day the FCDLs are mailed, you can check to see if you have a commitment by using USAC’s Automated Search of Commitments tool.

Consultant Registration Numbers

Consultants that assist applicants in filling out the application materials are identified on certain program forms as described below. We are providing more information for applicants on the definition of a consultant and how to report consultant information if required.

What is the definition of a consultant?

A consultant is any non-employee of the entity applying for funding that assists in filling out the application materials for a fee. “Non-employee” includes contractors or others who are employed by the entity on a contract or short-term basis who do not receive a W-2 form from the entity filling out the application. Consultants may be organizations with one or more employees or they may be individuals.

The term “consultant” below refers to the name – whether an organization or an individual – linked to the Consultant Registration Number and entered in the “Consultant Name” field on program forms.

What is a Consultant Registration Number?

A Consultant Registration Number (CRN) is a unique eight-digit identification number assigned by USAC to a specific consultant. Employees of a consultant will not be required to obtain individual CRNs but will use the CRN of the consultant.

If a consultant is assisting an applicant with the application process, the consultant’s CRN is entered in Block 1, Item 7 of the FCC Form 470 and/or Block 1, Item 6g of the FCC Form 471.

How does a consultant obtain a CRN?

To get a CRN, a consultant should call the Client Service Bureau (CSB) at 1-888-203-8100 and be prepared to provide the following consultant information:

  • Consultant Name
  • Consultant Street Address, City, State, and Zip Code
  • Consultant Telephone Number
  • Consultant Fax Number
  • Consultant Email Address

If the consultant has one or more employees, the following information is required for each employee:

  • Employee Name
  • Employee Telephone Number
  • Employee Email Address

CSB will first search by zip code, then by street address, to find out if USAC already has a CRN on file. If so – and if there are no changes to any of the contact information – CSB can provide the CRN over the phone.

If CSB must create a new record, or if there are changes required to an existing record, CSB will request that the changes be sent by fax to 1-888-276-8736 or by email. After the record has been created or updated, CSB can reply to the fax or email and provide the CRN.

How does an applicant find the CRN for its consultant?

If the consultant is completing a form on behalf of the applicant, the consultant can enter the CRN. If the applicant is completing a form, the applicant can obtain the CRN from the consultant or call CSB. CSB can provide the CRN over the telephone as long as the applicant provides enough information for CSB to identify a specific consultant.

  • Consultants and applicants filing online should check after entering the CRN to verify that the correct consultant information is populated in the form.

Where is consultant information located on FCC Form 470 and FCC Form 471?

Consultant information is entered in Block 1, Item 7 of the FCC Form 470 and Block 1, Item 6g of the FCC Form 471. Applicants filing online will enter the CRN, and consultant contact information will populate automatically. If the consultant has employees, those employee names will be populated in a drop-down menu and the applicant can choose the appropriate employee.

Applicants filing on paper must complete all relevant fields.


SLD News – 12/20/13 – Focus: “PQA Requests for Info” and “Winter Contact Period”

December 20, 2013

TIP OF THE WEEK: If your PIA reviewer made a successful contact before today (see below), your 15-day response clock has started. Be sure to check your preferred mode of contact – telephone, fax, or email – for communications from USAC so that you can respond appropriately.

Please note that USAC will not issue a News Brief next Friday, December 27. Also, the Client Service Bureau will be closed Tuesday, December 24 and Wednesday, December 25.

Commitments for Funding Years 2013, 2012, and 2011

Funding Year 2013. USAC will release Funding Year (FY) 2013 Wave 32 Funding Commitment Decision Letters (FCDLs) December 27. This wave includes commitments for approved Priority 1 (Telecommunications Services and Internet Access) requests at all discount levels. As of December 20, FY2013 commitments total over $1.58 billion and encompass 32,963 of FY2013 applications.

Funding Year 2012. USAC will release FY2012 Wave 73 FCDLs December 30. This wave includes commitments for approved Priority 2 (Internal Connections and Basic Maintenance) requests at 90 percent and denials at 89 percent and below. As of December 20, FY2012 commitments total over $2.81 billion.

Funding Year 2011. USAC will release FY2011 Wave 106 FCDLs December 20. This wave includes commitments for approved Priority 2 requests at 88 percent and above and denials at 87 percent and below. As of December 20, FY2011 commitments total just under $2.66 billion.

On the day the FCDLs are mailed, you can check to see if you have a commitment by using USAC’s Automated Search of Commitments tool.

PQA Requests for Information Arriving in January

The 2014 Payment Quality Assurance (PQA) assessment program will begin in January 2014. PQA is a program that assesses E-rate payments made during the current year to verify that they were properly made – in other words, that all program rules were followed correctly when the payment was authorized and disbursed.

Emails notifying applicants whose payments have been selected for PQA will be sent from the domain name Please check your email and respond promptly if you receive an email from USAC’s PQA Program. This will help expedite your review.

  • Do not hesitate to contact your reviewer if you have questions. Contact information is provided in the email.
  • Also, contact your PQA reviewer if you are unable to respond by the deadline.

For disbursements made each month in calendar year 2013, a certain number of payments will be chosen randomly, and applicants will be asked to provide specific documentation – for example, customer bills that support invoices submitted to USAC – to verify that those payments were made correctly. It is important that you maintain proper documentation in order to be able to respond correctly and completely to PQA requests. You can review the E-rate Binder on the USAC website for a list of documents to retain.

USAC is required to provide the Federal Communications Commission (FCC) with information about improper payments, as required by the Improper Payments Elimination and Recovery Act of 2010 (IPERA). USAC uses the PQA assessments to estimate the rate of improper payments and provides this information to the FCC annually. USAC’s goal is to ensure that the dollar amount of all improper payments is below 1.5 percent of the total dollar amounts disbursed.

For more information on this program, you can review the PQA Program document on the USAC website. 

Winter Contact Period Starts Today

USAC has procedures to contact applicants and service providers if more information is necessary to process a form. Below we discuss two of the most common situations where USAC needs more information:

  • Problem Resolution. If USAC cannot data enter a paper form because information is missing or inconsistent, Problem Resolution will attempt to reach the contact person listed on the form (or in our database, if no contact information is provided on the form) to obtain the necessary information.
  • Program Integrity Assurance (PIA) review. If USAC needs more information from an applicant to complete the review of an application, a PIA initial reviewer will use the contact information provided on the form to send questions and to inform the applicant of any correctable errors discovered on the form during review.

We realize that, during a summer period and a winter period each year, many applicants are unavailable due to extended holiday and break schedules.

  • Our winter period is defined as the Friday before Christmas Day through the Friday after New Year’s Day.
  • The dates of the current winter period are December 20, 2013 through January 3, 2014.

If our first attempt to reach you is on or after December 20, and we cannot confirm by telephone that you are available to respond to our questions, we will not begin Problem Resolution or PIA review until after January 3. However, if we have made a successful contact with you before December 20, your 15-day response clock has started and we will act on the information we have on hand if we have not heard from you by the response deadline. We define a successful contact as:

  • A sent email message with no return notification of non-delivery or out-of-office response
  • A sent fax with a confirmation of successful transmission
  • A voicemail left at the contact person’s telephone number if the recorded greeting does not state that the contact person is out of the office
  • A live person answering our call at the contact telephone number or a return call responding to our message.

If PIA has already contacted you and you wish to designate someone to answer questions in your absence, be sure to send your designee’s contact information to your PIA reviewer. If PIA has not contacted you and your designee will be checking your messages, be sure that you have provided written authorization for your designee to answer questions about your application. PIA will request this authorization in case any changes need to be made.

Your designee should have sufficient knowledge of your application to respond accurately. If someone answers a call from PIA but is not in a position to answer PIA questions, make sure the PIA reviewer understands that the application review should be put on hold until you return.


  • PIA will be actively reviewing applications during the winter period. If you can respond to PIA questions at this time, please do so – it will speed the processing of your application.
  • If our first successful contact with you was before December 20, your 15-day response clock is ticking. Be sure to respond by the deadline or let us know that you need more time to prepare your response.
  • Continue to monitor your preferred mode of contact if you are working. If you or your designee can respond to questions, the processing of your application can continue.
  • If you are not available to respond to questions, it would be helpful for you to indicate this via your preferred mode of contact (e.g., an out-of-office message on email or voicemail). We will not continue to leave messages or send emails if we know you are unavailable.

SLD News 12/13/13 – Focus: Form 470 Competitive Bidding Process

December 13, 2013

TIP OF THE WEEK: If you are not using a consultant, leave the consultant information fields blank on the FCC Form 470. If you are filing online and you start an entry in a consultant information field by mistake, you must completely delete your entry in order to continue.

Commitments for Funding Years 2013 and 2012

Funding Year 2013. USAC will release Funding Year (FY) 2013 Wave 31 Funding Commitment Decision Letters (FCDLs) December 18. This wave includes commitments for approved Priority 1 (Telecommunications Services and Internet Access) requests at all discount levels. As of December 13, FY2013 commitments total over $1.51 billion and encompass 32,262 of FY2013 applications.

Funding Year 2012. USAC will release FY2012 Wave 72 FCDLs December 19. This wave includes commitments for approved Priority 2 (Internal Connections and Basic Maintenance) requests at 90 percent and denials at 89 percent and below. As of December 13, FY2012 commitments total over $2.81 billion.

On the day the FCDLs are mailed, you can check to see if you have a commitment by using USAC’s Automated Search of Commitments tool.

Posting the FCC Form 470

In the December 6 SL News Brief we discussed the FCC Form 470, which applicants file to open a competitive bidding process for the services they desire. In this issue, we are providing additional information about posting the FCC Form 470; in the near future we will include guidance on receiving responses from bidders.

Remember that the applicant is responsible for ensuring an open and fair competitive bidding process. Only applicants can determine the types of services sought and prepare, complete, sign, certify and submit FCC Forms 470. If service providers undertake or assist the applicant with any of these actions, funding will be denied.

Posting for Priority 1 services

Starting with FY2013, applicants can post Priority 1 services on the FCC Form 470 in either the Telecommunications Services or the Internet Access category of service. In fact, the proposed draft FCC Form 470 – which should be available shortly – will feature only the category “Priority One Services” for all Priority 1 services.

Note that applicants will be required to post their services in the correct Priority 1 category of service on the FCC Form 471, but they will not be penalized if the Priority 1 category of service on the FCC Form 471 does not match the Priority 1 category of service posted on the FCC Form 470.

State or local requirements and E-rate requirements

Applicants posting FCC Forms 470 must comply not only with E-rate program requirements but also with all applicable state and local competitive bidding requirements. In general, when E-rate program requirements and state and/or local requirements differ, you should comply with the requirements that are more stringent to make sure you are in compliance with both.

Requests for Proposal

A Request for Proposal (RFP) is a formal bidding document that describes the project and requested services in sufficient detail so that potential bidders understand the scope, location, and any other requirements. Although you may know these by a different name – such as Request for Quote (RFQ) or Statement of Work – USAC uses the term RFP to cover all such documents. Applicants may be required by state or local procurement rules or regulations to issue an RFP, or they may choose to do so because of the size or scope of their project or services requested.

  • Note: The FCC Form 470 and RFP must contain sufficient information to enable prospective bidders to formulate bids. If the FCC Form 470 describes in broad terms the services for which the applicant is seeking bids and the applicant also provides additional supplementary documents, those documents could be considered an RFP if they contain the detailed information necessary for the formulation of responsive bids. The applicant should consider checking the box indicating that an RFP is available if such documents are provided.

If an RFP is issued, both the RFP and the FCC Form 470 must be available for at least 28 days. While the FCC Form 470 and the RFP may be issued on the same day, in cases where one document is issued before the other, both the FCC Form 470 and the RFP must be available for least 28 days. The competitive bidding process cannot be closed prior to the second document being available for at least 28 days.

If Priority 2 products and services are being requested, those requests must be based on the applicant’s technology plan. Remember that the technology plan must be created (at least in draft form with all four required elements addressed) before the FCC Form 470 is posted to the USAC website.

As stated above, the applicant must follow all applicable state and local procurement rules and regulations that pertain to RFPs – e.g., issuing a formal RFP when purchasing services over a certain dollar threshold, posting any required announcement of the RFP in a newspaper, etc.

Bona fide requests

The FCC Form 470 – and RFP, if one is issued – must contain bona fide requests for services, which means that you list the specific services for which you anticipate seeking funding support. The FCC Form 470 and/or RFP must provide clear and complete descriptions of the project to be undertaken or the services desired, in sufficient detail for a service provider to be able to formulate bids. An applicant may, in certain circumstances, list multiple services on its FCC Form 470, knowing that it intends to choose one over another. However, all products and services listed on the FCC Form 470 must be linked in a reasonable way to the applicant’s technology plan, if one is required, and not request duplicative services.

Applicants cannot simply include “laundry lists” of services (i.e., entering all services eligible for funding under the E-rate program) or generic descriptions of services (e.g., “broadband connections”). If you anticipate the need for growth of broadband connections during the term of the contract that would result from the competitive bidding process, you should indicate the required speed as well as the higher potential speeds desired.

Manufacturer or brand names

Applicants cannot include the name of a specific manufacturer, brand, product, or service on an FCC Form 470 or RFP unless they also use the words “or equivalent” in their description of the products and services desired. Moreover, the applicants must then carefully consider all bids received, including any equivalent offerings, before choosing the most cost effective bid.

NOTE: Applicants may require service providers to provide services that are compatible with one kind of system over another (e.g., “Brand X compatible”).

Breaking existing contracts

If the applicant is breaking an existing contract, the new service provider cannot pay any associated contract termination charges. The applicant cannot include a request or requirement to pay those associated termination charges in either the FCC Form 470 or the RFP.

Restrictions imposed by state or local laws or regulations, reasons for disqualification, and other bid information

In Item 13 of the FCC Form 470, the applicant indicates for potential bidders any applicable restrictions imposed by state or local laws or regulations. The applicant can also set out specific requirements and disqualify bids that do not meet those requirements. However, note that these disqualification factors must be clearly spelled out on the FCC Form 470 and/or the RFP so that they are available to all potential bidders.

If you are filing online, you can open the text field in Item 13 and enter and save additional information you need to provide by:

  • Putting a check in the first checkbox in Item 13 if you are using the Expert version of the online form or
  • Clicking the “Yes” button for one of the Item 13 questions if you are using the Interview version of the online form.
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