E-Rate Modernization An exploration of changes from the first order of E-Rate 2.0 (July 2014) Vermont Fest---Nov. 6, Peter Drescher, Education Technology Coordinator Vermont State E-rate Coordinator --Rex Miller, Chief Financial Officer Education Networks of America

Resources A few resources on our web page:our web page technology Review training slides from USACtraining slides From the USAC website

To begin: Remember: ALL changes to E-rate are considered a “pilot” at this point. Two years? Some could be reversed. Next order: on docket for December You might consider: ◦An E-Rate consultant to help you navigate ◦Another School or SU entity to assist

Some Stats and high points.. Nationally program capped at $2.25B ◦Vermont: 2014#’s 1.7M Pri1, Pri2: req.2.5M got 317K. Additional $1B dollars to be made available over —targeted to internal connections Priority overall is to meet more demand under Category 1 FCC confidence high that sufficient funds available over funding years and beyond.

Three Main Goals (July order) Affordable Access to high-speed Broadband Cost Effectiveness Streamlining and efficiencies in the application process Rules to take effect for FY2015

Goal 1: Maximize Broadband Change in language but minor in structure: ◦Priority 1 Category 1 No significant change in Category 1 funding: ◦Continues to be funded first ◦Discount matrix remains the same

Funding % change-discount rates For Voice services: 70% in FY15 Reduction of 20% each year beyond. For Category 2, the highest discount level will be 85% (not 90%). Category one services remain at 90%

Simplifying Discount Calculations I Fall 2014 E-rate Program Applicant Trainings8 Revised Discount Matrix Note lower top discount rate for Category Two services.

THE CHANGE... Comes in Priority 2 Category 2 New Focus in Internal Connections ◦Especially in terms of WIFI  If schools already have wifi, they can AND SHOULD use funds for maintenance-- ◦Changes to Eligible services list--REVIEW ◦

In Vermont... Many schools have installed wifi networks How can we benefit from the new focus? ◦Planning for expansion or upgrades ◦Maintenance plans are still acceptable ◦Long term plan—knowledge that funding exists Recommend? Look at existing ◦Make plans for upgrade within 2-3 years ◦Remember: Assessment comes in 2015

Category 2 cont’d ◦90% discount reduced to 85%  RECALL: All other (Cat 1) discount levels unchanged ◦$150 per student available over 5 years ($2.30 per square foot for libraries)  Can be received all in year 1  Ordered by discount rate  5 year applicant “budget”  $9,200 funding floor per school/library  No extra funding for rural remotes – all equal ◦Student Counts –  Can use estimate for new buildings  Can count students at 2 buildings if attend multiple schools ◦Category 2 Installation can begin on April 1st

Example.. Dist 1 – 85% Dist 2 – 80% Dist 3 – 70% Year 1 – Dist 1 at 85% will go first, they will take the maximum amount they can $150 per student, Dist 2 at 80% might not get anything Year 2 – Dist 2 at 80% would go first and take the max amount, Dist 3 at 70% might not get anything Year 3 – with Districts 1 and 2 already receiving their budgeted amount, Dist 3 at 70% is first in line The hope is that over 5 years all schools and libraries will get their $150 per student (and remember $150 is the total cost – E-rate pays $150 x discount rate)

Cost effectiveness Some obvious changes (Allowable) ◦Caching ◦Some cloud services ◦Routers, switches ◦Managed Wi-Fi Eligible –  Renamed Managed Broadband Internal Connections by FCC No longer funded: ◦Circuit cards, antennas, gateways, servers, telephone and video components, Data protection other than firewall and UPS (read: VPN’s), software, storage devices, VoIP and Video over IP components

Goal 3- Streamline application Simplify discount rates Simplify invoicing and disbursement Manage Appeals more efficiently SLD Administration fixes Protection from Waste, Fraud, Abuse

Simplifying Process Discount rate: each district calculate and use a single district wide discount rate rather than using building by building (VT-troublesome for some) (allows adding of sites) Multi-year contracts (5 years or less): ◦Submit 471 first year (2015) ◦Then in subsequent years:  Submit (form TBD) that explains this as continuation and documents any changes from year to year  Changes in discount rates  Membership of consortium  Services ordered  All need to be within scope of original 470

Simplify Process Exempt from filing 470 for Internet Access Service if: ◦Service offers at least 100mbps down and 10 up for pre- discount price of or less annually, including installation and equipment charges And the price and service are commercially available MUST HAVE signed contract or other legally binding agreement in place prior to submission of 471 Protects support for those that have agreed to negotiated terms but have not obtained signatures on contract yet. A little risky here----get signatures on contracts Probably OK in VT, but other states local and state laws may not fly

Schools/Libraries connect—Rural status Schools and libraries can be connected on the same network– and by filing a waiver can make direct connections between the two entities. (why?) Rural status for E-rate– tool going to be provided to determine that. Highly rural libraries may benefit from this as they don’t need to tie to schools status

Technology Plans Full disclosure from Vermont: Technology plan requirements are eliminated completely from the E-rate program --Anticipate reporting in different ways from USAC—network planning, configurations, utilization, etc. Vermont wishes to require plan within different planning documents due to State. (Pending)

Invoicing Deadlines/Other Changing rules around the deadline— Extension is now possible for additional 120 days—one time only. Document retention schedule goes from 5-10 years. Must allow auditors, investigators, etc. on premise to review documents, do compliance reviews.

Next Order Will Funding be increased? Should they limit contracts to 5 years? Consortium discount rates—use weighted calculations? More on consortiums expected Rural/Urban questions– urban clusters More eligibility on voice items—VOIP?

Additional Questions/Info. Peter Drescher