e-rate for beginners

E-rate for BeginnersJohn NoranSchools and Libraries DivisionUniversal Service Administrative Company

Train-the-Trainer WorkshopSeptember 27-29, 2004

Universal Service Administrative Company

School and Libraries Support MechanismProvides discounts to eligible schools and libraries for Telecommunications Services, Internet Access, Internal Connections, and Basic Maintenance.Applicants can be schools, libraries, or consortia, but only eligible recipients of services can receive discounts.Applicants must apply for discounts each year.Funding is capped at $2.25 billion annually.From January 1, 1998 through September 7, 2004, more than $13.7 billion in funding commitments have been issued to eligible schools and libraries.Overview*


HistorySchools and Libraries Support Mechanism started providing discounts as of January 1, 1998Telecommunications Act of 1996Congress directed the FCC to establish competitively neutral rules . . . to enhance, to the extent technically feasible and economically reasonable, access to advance telecommunications and information services for all public and non-profit elementary and secondary school classrooms . . . and libraries.First Report and Order (FCC 97-157)*


IntroductionVendor AssistanceNSI in New JerseyApplication review Program Integrity Assurance (PIA)Invoice review (PIA)Appeal processProgram correspondence, including change and extension requestsPearson Government Solutions in KansasClient Service Bureau (call center)Forms processing*


EligibilityEligible EntitiesSchoolsMust meet the statutory definition of elementary or secondary school found in the No Child Left Behind Act of 2001.Must be a non-profit institutional day or residential school, including a public charter school, that provides elementary or secondary education, as determined under state law.Must not be operating as a for-profit business.Must not have an endowment exceeding $50 million.*Applicants


EligibilityEligible EntitiesSchools (cont.)Pre-kindergarten, Adult Education, Juvenile JusticeMust meet state definition of elementary or secondary education.Students and/or facilities may be eligible. SLD requests updated information from state departments of education every two years.*Applicants


EligibilityEligible EntitiesLibrariesMust meet the statutory definition of library or library consortium found in the Library Services and Technology Act (LSTA) of 1996.Must be eligible for assistance from a state library administrative agency under LSTA.Budget must be completely separate from any schools.Must not be operating as a for-profit business.*Applicants


EligibilityService ProvidersMust file Form 498, Service Provider Information FormRequest a Service Provider Identification Number (SPIN)Provide/update contact information.Must file Form 473, Service Provider Annual Certification Form, on an annual basisRequired for invoices to be paid.

*Service Providers


Telecommunications CarrierProviders of Telecommunications ServicesMust contribute to the Universal Service Fund, if applicable. Must provide telecommunications services on a common carriage basis to be a telecommunications carrier.To be a telecommunications carrier, the carrier must(1) allow the customer to transmit information of its own design and choosing, without change in the form or content of the information, and(2) provide that capability for a fee directly to the public, or to such classes of users as to be effectively available to the public (i.e., hold itself out to serve indifferently all potential users).

Service Providers


Telecommunications CarrierTelecommunications CarriersMust file Form 499A on an annual basis and check at least one box on Line 227 and file Forms 499Q, if applicable.Must revise the Form 498 to reflect Form 499 Filer. I.D. SP must be designated eligible in SLD database.SP may not provide telecommunications services if it has not been designated as a telecommunications carrier.

Service Providers


EligibilityEligible ServicesPriority 1Telecommunications Serviceslocal and long distancewireline and wirelessvoice, data, video Internet AccessPriority 2Internal Connections (switches, hubs, routers, wiring)Basic Maintenance on Internal ConnectionsPriority 1 funded first, then Priority 2 funded beginning with neediest applicants (90%, 89%, 88%, etc.)*


EligibilityEligible ServicesEligible Services ListLists services by category (Telecommunications Services, Internet Access, Internal Connections, and Miscellaneous)Services which are conditionally eligibleIneligible servicesAvailable on SLD web site*


Calculating DiscountsDiscount CalculationNational School Lunch Program (NSLP)Individual schools start with the percentage of students eligible for NSLP for their schoolSchool districts start with the NSLP percentages of individual schools in the district, calculate weighted average of all schoolsLibraries start with the percentage of students eligible for NSLP for the school district in which the library is locatedConsortia calculate simple average of discounts of membersUrban or rural status of county in which school or library is located (from web site)*Applicants


Calculating DiscountsPoints to Remember:All discount calculations will involvepercentage of students eligible for NSLP in a school or school districtdetermination of Urban/Rural statusdiscount from Discount Matrix.Applicant with members or subunits must calculate an average of those membersSchool district individual schoolsLibrary system library outlets/branchesConsortium eligible member entities

*Applicants


Application ProcessTechnology Plan What is my plan?Form 470 What services do I want?Form 471 What services did I order?Form 486 When did services start?Form 472 or Form 474 How do I receive reimbursements or discounts?

Online filing/certification available for most forms

*Applicants


Application ProcessForm 498 What is my SPIN?Form 499A for Telecom Carriers What is my responsibility to the Universal Service Fund?Form 473 What am I required to do before receiving payment on an invoice?Form 472 or Form 474 How do I submit invoices to USAC?

Online filing available for most formsOnline service provider certification under consideration

*Service Providers


Technology PlanningTechnology PlansNot required for basic local, cellular, PCS, and/or long distance phone service and/or voice mailMust be written before Form 470 filingMust be approved by an SLD-certified approver before Form 486 filing or start of services, whichever is earlierMust cover five areas:Goals / Strategies for using technologyProfessional developmentNeeds assessmentSufficient budgetEvaluation process

*Applicants


Technology PlanningService providers may offer NEUTRAL technical assistance.Service providers may not act as technology plan approvers.

Service Providers


Form 470Form 470Opens a competitive bidding processApplicant responsible for ensuring an open, fair process and selecting the most cost-effective provider of the desired servicesMust wait 28 days after POSTING of Form 470 to select service provider, sign contract, and sign and submit Form 471Can be filed once for multi-year contracts, but 470 and RFP must indicate intent to sign multi-year contract with extensionsMake RFP available or list specific service/function and quantity/capacity

*Applicants


Form 470Competitive BiddingRequest for Proposal (RFP)Not required under the FCC Rules, but a good ideaMust comply with local and state procurement lawsDescribes your project scope, location, other requirements in detailCompetitionGoal is to have as many bidders as possiblePromotes better service and lower pricesFair and open processAll bidders treated the same, no advance knowledge of RFP informationNo secrets in the process, all bidders know what is required of them

*Applicants


Competitive Bidding ProcessService providers must remain NEUTRAL at all times.Service providers may not interfere with applicants affirmative duty to conduct a fair and open bid process.Service providers may not exert undue influence over an applicant.Service Providers


Competitive Bidding ProcessObligation to Pay Non-discount ShareApplicants are required to pay their share of the cost (the non-discount portion or share) cannot be donated, forgiven or ignored.Service providers cannot waive or credit the applicants share.Offers to reduce price must be incorporated into the total pre-discount amount.Service provider must bill the applicant for non-discount share of services.

*Both


Competitive Bidding ProcessFORM 470Service providers may offer basic information, such as timelines and deadlines.Service provider or its consultant may not complete the 470.Service provider or its consultant may not sign the Form 470.Service provider or its consultant may not file the Form 470. Service providers may not prepare the RFP.Service providers may contribute information on technical issues.

Service Providers


Form 470Points to Remember:Competitive bidding process must be open and fair.List services sought in correct category of service (Form 471 must match).Retain worksheets, bid evaluation criteria, winning AND LOSING bids.Form 470 must be certified by close of Form 471 application filing window.Filing online speeds processing and reduces errors.

*Applicants


Form 470Form 470 Receipt Notification Letter (RNL)Cover page of important reminders and deadlinesNotifies applicant that Form 470 has been posted to the SLD web siteSystem will generate RNL for Forms 470 filed online after form is submitted but before it is certified.Form MUST be certified before close of Form 471 application filing window.Contains Allowable Vendor Selection / Contract Award Date

*Applicants


Form 471Form 471Provides specific information on services, service providers selected, and contractsProvides discount calculation informationMust be filed for each funding yearMust be postmarked on or before the last day of the Form 471 application filing windowApplicant certifies compliance with rules, which include securing access to resources to make effective use of discounts.

*Applicants


Form 471Points to Remember:WAIT AT LEAST 28 DAYS from the posting of the Form 470 beforeselecting a service providersigning a contractsigning and submitting a completed Form 471.File separate Forms 471 for Priority 1 and Priority 2 services.Remove ineligible costs and document or estimate eligible costs carefully (30% Rule).Filing online speeds processing and reduces errors.

*Applicants


Form 471Service providers should always provide correct SPINs and contact information.Service providers are encouraged to provide guidance to the applicant on its services and functionality during the application process.Service ProvidersPoints to Remember:


Service providers are encouraged to assist with providing information for the Item 21 attachment for their services.Clear level of detail on the Item 21 attachment may advance the processing of the invoice. An example of such detail would be the inclusion of the item (model #), quantity, and unit cost. Service ProvidersForm 471


Applicants will not receive support for contracts that provide only a single price for a package that bundles both eligible and ineligible services together. Service provider and applicant should work together to create pricing terms in the contract that separate eligible services from ineligible services.Service providers are also encouraged to assist in providing applicant with billing account numbers and contract numbers.Service ProvidersForm 471


Form 471Form 471 Receipt Acknowledgment Letter (RAL)Cover page of important reminders and deadlinesProvides confirmation of certain information entered from Form 471Data entry errors may be corrected by submitting a copy of the RAL with the specific errors lined out and the correct information supplied three-week deadline.Funding request reductions may also be submitted before funding commitment.

*Applicants


Contract RequirementsFCC Rules require applicant to sign a contract prior to the filing of a completed Form 471. 47 C.F.R. 54.504(c).Fifth Report and Order requires both the applicant and service provider to sign the contract prior to the filing of a Form 471.This rule does not apply to tariffed or month-to-month services.Verbal agreements are not acceptable.Quotes are not acceptable.Both


Service provider and applicant must comply with state contract law.Service provider and applicant must comply with state and local procurement laws.Contract RequirementsBoth


Applicant must provide signed and dated contracts for reviews and audits.Applicant must be prepared to prove its contract meets the requirements of state contract law. Applicant certifies that it has signed a contract on its Form 486.Contract RequirementsBoth


Contract RequirementsService provider is required to permit the applicant prior to the submission of the Form 471 to choose the Method of Payment BEAR v. SPI for discounted services.FCC Second Report and Order encourages the applicant and service provider to work together to determine the method of payment.FCC Second Report and Order encourages including the method of payment in the contract.

Both


Contract IssuesKnow your legal rights.SLD does not intervene in disputes that are contract-based rather than program-rule based. Contract disputes should be brought before local and state courts, not the SLD or the FCC.Both


State Master ContractsIf the state filed a Form 470, then the applicant may cite the states Form 470 on its Form 471.The applicant is required to follow the applicable provisions of the state master contract and local and state procurement laws.No separate bidding documents or contracts are required by the applicant citing the states Form 470, other than what is required by the state master contract and local and state procurement laws.The signed state master contract between the state and service providers meets the FCC signed contract requirement.

Both


State Master ContractsIf the applicant files a Form 470 and considers a state master contract as one of the bids:The applicant is required to comply with all competitive bidding requirements.If the applicant selects the state master contract: The applicant is required to follow the applicable provisions of the state master contract and local and state procurement laws.The signed state master contract between the state and vendors meets the FCC signed contract requirement.

Both


State Master ContractsPurchase orders or other state master contract requirements for applicantsIf a state master contract requires the issuance of purchase orders or contains other binding requirements for applicants, the applicants must follow the applicable dates set forth in the state master contract.For example, if a state master contract requires the applicant to issue a purchase order by July 1, then the applicant is required to meet that deadline.Both


Application ReviewReview of ApplicationsReview by PIA, which may include:Competitive bidding processContractsDiscount calculationSufficient budgetEstablishing Form 470Technology Plan

*Applicants


Application ReviewPoints to Remember:Provide information requested by reviewers (PIA) promptly.If desirable, work with your state coordinator to comply with information requests.Ask for more time if you need it.Retain documentation.Review Request for Selective Review Information fax to understand what information might be requested.

*Applicants


Funding CommitmentsCommitments vs. Disbursements$2.25 billion cap for each funding year.SLD may commit more that $2.25 billion for a funding year if unused funds from previous funding years have been rolled over to that year.*


Funding CommitmentsFunding Commitment Decision LetterCover page of important reminders and deadlines FCDL reports status of individual funding requests:FundedNot FundedAs Yet Unfunded (Internal Connections)Service provider does not receive this statusCanceledMay receive more than one FCDL

*Both


Funding CommitmentsPoints to Remember:Check all entries on the FCDL carefully to make sure there are no data entry errors.Applicants use the information on the FCDL to prepare the Form 486.*Both


Form 486Form 486Notification that services have started and the SLD can pay invoicesCertifies that Tech Plan (if required) has been approved.If Tech Plan has not been approved by SLD-certified approver, the application is subject to denial and invoices will not be paid.Certifies status under Childrens Internet Protection Act (CIPA).Lead members of consortia may be required to collect CIPA certifications from consortium members on a separate form (Form 479).*Applicants


Form 486Form 486 DeadlineForm 486 must be postmarked no later than120 days after the Service Start Date featured on the Form 486 OR120 days after the date of the Funding Commitment Decision Letterwhichever is later.If Form 486 is postmarked later than the above deadline, the date 120 days before the Form 486 postmark date will become the start date for discounted services and funding may be reduced.*Both


Form 486Form 486 Notification LetterCover page of important reminders and deadlines. Provides confirmation that a Form 486 has been successfully data entered.SLD will accept invoices from applicants and service providers once the Form 486 is successfully processed.

*Both


Service Delivery DeadlinesRecurring ServicesJune 30 of funding yearNon-recurring Services September 30 following the close of the funding yearDeadline automatically extended to September 30 of the following year for FCDLs, service substitution approvals, and SPIN change approvals dated on or after March 1 of the funding year.Applicants can also request extension for specific reasons involving difficulties with delivery of services by service provider.See web site for further information.

*Both


Form 473Form 473 Service Provider Annual Certification (SPAC) FormService providers are required to file on an annual basis.SLD will only pay invoices for a funding year if a SPAC is on file for that funding year.SPACs are required for both BEARs and SPIs.SPIN Search Tool on SLD web site lists funding years for which a SPAC is on file.*Service Providers


InvoicesInvoices Form 472 or Form 474BEAR (Billed Entity Applicant Reimbursement) Form 472 is filed by the applicant and certified by the service provider after the applicant receives services and pays for the services in full.

OR

SPI (Service Provider Invoice) Form 474 is filed by the service provider after providing services and billing the applicant for its non-discount share.*Both


InvoicesPoints to Remember:Invoices cannot be used to request SPIN changes or service substitutions.Invoices are reviewed for program compliance respond promptly to requests for information.Service providers are required to reimburse the applicant within 20 days after RECEIPT of the funds from SLD.*Both


InvoicesInvoice DeadlinesInvoices must be postmarked no later than120 days after the last date to receive service OR120 days after the date of the Form 486 Notification Letterwhichever is later.If an invoice is postmarked later than the above deadline, payment will be denied.Extensions of invoice deadlines may be requested under certain conditions.See web site for details.*Both


InvoicesBEAR Notification LetterCover page of important reminders and deadlines Provides confirmation that a Form 472 (BEAR) has been successfully data entered.Indicates what amounts are being paid and reason for reductions/denials.SPI Electronic Notification Invoice Status ReportService provider can receive an electronic notification.

*Both


SPIN ChangesCorrective SPIN Change to correct data entry errors or where the applicant used the wrong SPIN for the service provider selectedGlobal SPIN Changes mergers or acquisitions in whole or in partConsidered a Corrective SPIN changeOperational SPIN Change only available after receipt of FCDLSee web site for more guidance.Both


Operational SPIN ChangesFor changes to a new service providerApplicant must make three certifications:Change allowed under local procurement lawsChange allowed under terms of contractOriginal service provider notified of intent to changeCan NOT be used for telecommunications services if new SPIN is not a telecommunications carrier

Both


Document RetentionRemember 5-year retention requirement for all documents.Good recordkeeping is ESSENTIAL.Keep copies of EVERYTHING.Keep these documents with E-rate files, or copies, if accounting department keeps its own files.

*Both


Document RetentionTypes of records to retain include:Competitive bid documentsRFPs, bids, quotes, proposals, etc.Signed contractsService provider bills to customersDetail of services/products and locationsIndicate entity(ies) receiving service/productsDelivery/installation datesApplicant paymentsCancelled checksService credits for any reason*Both


AppealsDecisions of the SLD can be appealed to the SLD or to the FCC.Generally, appeal first to the SLD.Can appeal to the FCC if SLD does not grant the appeal.Can be filed electronically or on paper.Must be received or postmarked within 60 days of the SLD decision.See Appeals Procedure in Reference Area for specific guidance.Requests for waivers of rules must be filed with the FCC.

*Both


AuditsWhy do we do audits?To provide data regarding program rule compliance.To identify areas needing education and outreach.To clarify program rules that must be strengthened to prevent waste, fraud and abuse.To enforce accountability for program rule compliance.To deter noncompliance.

*Both


AuditsWho performs audits?USAC Internal AuditIndependent auditors engaged by either USAC or the FCCFCC Office of Inspector GeneralOther agencies

*Both


AuditsWhat documents do auditors need?Budget / financial statementsTechnology Plan and approval letterDocumentation of competitive bidding processDocumentation of discount level claimedCopies of contracts and contract extensionsCopies of service provider bills, cancelled checks, BEAR Forms, BEAR checks, and other supporting documentationAsset inventories or registers*Both


AssistanceSLD main page of USAC web sitewww.sl.universalservice.orgClient Service BureauUse the Submit a Question link on the web siteFax toll-free at 1-888-276-8736Telephone toll-free at 1-888-203-8100Read the form instructions*Both


http://www.sl.universalservice.org


http://universalservice.webex.com

e-rate for beginners

Documents

kansasclient service

eligible schools

information services

library services

telecommunications services

secondary education

state definition of

telecommunications act