E-Rate 101: Overview of the Program Training for Success Schools and Libraries Division Washington, DC Orlando Boston New Orleans Cleveland San Francisco Phoenix September/October 2007

2 Overview  Eligibility  Eligible services  Technology planning  Requesting services (Form 470)  Discounts  Ordering services (Form 471)  PIA Review and commitments  Confirming services (Form 486)  Invoicing (Form 472 or Form 474)

3 Funding Timetable  Funding commitments are made by funding year (July 1 – June 30) –Recurring services received July 1 – June 30 (12 months) –Non-recurring services delivered and installed July 1 – September 30 (15 months)  The Window: Form 471 filing window (mid- November to early February before the start of the funding year)  We encourage you to file online

4 Applicant Eligibility  To be eligible, a school: –Must meet the statutory definition of an elementary or a secondary school in the No Child Left Behind Act of 2001 –Must not be operating as a for-profit business –Must not have an endowment exceeding $50 million

5 Applicant Eligibility  To be eligible, a library: –Must be eligible for assistance from a State library administrative agency under the Library Services and Technology Act –Must not be operating as a for-profit business –Budget must be completely separate from any schools

6 Applicant Eligibility  Consortia –Can include both eligible and ineligible entities –Only eligible entities can receive discounts –Consortium leader has record-keeping and administrative responsibilities

7 Service Provider Eligibility  Form 498 (contact information) –Request a Service Provider Identification Number (SPIN) –Provide/update contact information  Form 473 (annual certification) –Must be filed for each funding year before USAC will pay invoices

8 Service Provider Eligibility Telecommunications Carriers  Must provide telecommunications services on a common carriage basis  Must file Form 499A every year and may be required to contribute to the Universal Service Fund

9 Eligible Services Four categories of eligible services  Priority 1 (funded first) –Telecommunications Services –Internet Access  Priority 2 (funded beginning with neediest applicants first) –Internal Connections –Basic Maintenance of Internal Connections

10 Eligible Services  Priority 1 –Telecommunications Services Local and long distance, wireline and wireless, voice/data/video –Internet Access Basic conduit access to the Internet

11 Eligible Services  Priority 2 –Internal Connections (switches, hubs, routers, wiring, cabling) Internal Connections funded only 2 in 5 funding years –Basic Maintenance of Internal Connections NOTE: End user equipment - such as computers, monitors, or phone sets - is NOT eligible

12 Technology Plan  Applicants must develop a technology plan –Use telecommunications services and information technology to achieve educational goals and/or library improvements  A plan IS required for discounts on any products or services other than “Basic Telephone Service” and voice mail.

13 Technology Planning  Must contain five elements: –Goals/Strategies for using technology –Professional development –Needs assessment –Evaluation process –Sufficient budget Make sure your technology plan is written at the time the Form 470 is filed

14 Technology Planning  Must be written before Form 470 is filed  Must cover all 12 months of the funding year  Should not cover more than 3 years  Must be approved by a USAC-certified Technology Plan Approver (TPA) by the start of services or the filing of Form 486, whichever is earlier  Service providers should not be involved in the creation of the technology plan and should not act as the technology plan approver

15 Form 470 Form 470 – Services Requested  Filed by applicants to define desired services and open the competitive bidding process  Must be posted on the USAC website for at least 28 days before selecting service provider and/or signing a contract  Form 470 request must be based on the technology plan  Applicants can also issue a Request For Proposal (RFP), which must also be available for at least 28 days

16 Form 470 Multi-year or annual posting  Can be filed once for multi-year contracts or contracts with voluntary extensions, but Form 470 and RFP must indicate intent  Tariffed or month-to-month services must post Form 470 annually  Service providers are prohibited from filing and signing Form 470 or representing applicant in bidding process

17 Form 470  Competitive Bidding –The applicant must conduct a fair and open bidding process All bidders are treated the same All bidders have equal access to information All bidders know what is required of them –The applicant must choose the most cost- effective offering with the price of eligible products and services being primary

18 Receipt Notification Letter Receipt Notification Letter (RNL)  Issued by USAC after Form 470 is posted  Provides important information –Allowable Vendor Selection/Contract Date (28 days after posting)  Offers opportunity to make allowable corrections

19 Discounts  Schools and libraries can receive discounts on eligible services.  Discounts range from 20% - 90% on eligible products and services  Discounts are based on: –Percentage of students eligible for the National School Lunch Program (NSLP) –Urban or rural location of school or library

20 Discounts Discount Matrix Percent of Eligible Students UrbanRural Less than 1%20%25% 1% - 19%40%50% 20% - 34%50%60% 35% - 49%60%70% 50% -74%80% 75% -100%90%

21 Discounts  Calculating Discount Methods –Primary measure: NSLP –Alternative discount mechanisms  Shared Discounts –School districts use the weighted average of the discounts of individual schools in the school district –Libraries use the simple average discount of the school district in which they are located –Consortia use the simple average of the consortium members

22 Contracts  Applicants must sign and date contracts before the Form 471 is certified –Date can be written in contract  Contracts can cover more than one year or contain extensions, but these options must be indicated in the establishing Form 470  Tariffed and month-to-month services do not require a contract, but they are considered contracted services if a contract is signed

23 Form 471 Form 471 – Services Ordered  Contains specific information on services ordered, quantities, from whom, at what price  Shows discount rate calculation and lists entities receiving services  Applicant certifies compliance with rules and verifies that it has the necessary resources to make effective use of the discounted services  Must be filed each year within the filing window

24 Form 471  Service providers are encouraged to: –Provide guidance to the applicant on its services and functionality –Assist with providing information for the Item 21 attachment and other information  Service provider should always provide correct SPIN and contact information  Service providers should avoid any involvement in the bidding process except as bidders and should not answer any questions regarding the bidding process.

25 Receipt Acknowledgment Letter (RAL)  Issued by USAC to applicants and service providers after Form 471 is certified  Confirms the filing of the Form 471 and provides the details of the funding requests  Offers an opportunity to make allowable corrections

26 PIA Review  Program Integrity Assurance (PIA) checks for compliance with program rules, eligibility of entities and services, verification of service types/costs –Provide complete and prompt responses to PIA’s questions –Ask for clarification if you don’t understand –Service providers can assist applicants in responding to PIA questions about the products and services they are providing but not about other areas.

27 Funding Commitments  USAC issues Funding Commitment Decision Letter (FCDL) to applicants and service providers when PIA review is complete  Funding status by Funding Request Number (FRN): –Funded (includes modifications) –Not funded –As yet unfunded (applicant FCDL only) –Canceled  Funds approved for specific services from specific service providers at the applicant’s approved discount rate

28 Form 486 Form 486 – Services Confirmed  Notifies USAC that services have started and invoices can be paid  Applicant certifies that its technology plan meets program requirements  Applicant certifies its status under Children’s Internet Protection Act (CIPA)

29 Form 486  Filed online or postmarked no later than –120 days after the Service Start Date or –120 days after the date of the FCDL, whichever is later  There may be a penalty for filing late  Service Start Date –Cannot be before July 1 of the funding year

30 Invoicing Form 472 or 474 – Services Invoiced  Requests reimbursement from USAC for discount on cost of services delivered  Filed online or postmarked no later than –120 days after the last date to receive service or –120 days after the date of the Form 486 Notification Letter, whichever is later  Two options for requesting reimbursement

31 Invoicing Form 472 Billed Entity Applicant Reimbursement (BEAR) Form –Filed if applicant PAID for services in full –Reimbursement handled through service provider –Cash or credit reimbursement –Service provider must reimburse applicant within 20 days of receipt of funds

32 Invoicing Form 474 Service Provider Invoice (SPI) Form –Filed by service provider –Applicant gets discounted bills –Submitted AFTER applicant has received service and been billed by service provider