| Initial comments in response to the FCC’s Notice of Proposed Rulemaking (“NPRM”) are due on Monday, July 21. The E-rate issues on which the FCC is seeking comments include rules for the identification and carryover of unused funds, several minor items dealing with technology plans and a computerized eligible service list, and major provisions related to the potential disbarment of vendors and/or applicants. An open-ended request for comments related to waste, fraud, and abuse effectively invites comments on a broad range of E-rate issues.
A detailed list of the FCC’s requested comments, prepared by E-Rate Central, is available (see Requested Comments). A copy of the FCC’s E-rate Order and NPRM (FCC 03-101) is also available (see FCC 03-101).
The easiest way to file comments in this rulemaking is to do so via the FCC Web site. Comments are not required to be in any specific or legalistic format, but should reference “CC Docket No. 02-6.” Detailed instructions for filing comments can be found in the Order itself starting at Paragraph 154. Note that if the online filing process is not used, multiple paper copies, plus diskette copies, must be sent to several parties.
Anyone interested in viewing comments submitted by others (both in response to this NPRM and other E-rate matters) can “Search for Filed Comments” on the FCC Web site (see Search for Filed Comments). To use this search function, enter “02-6” in Box 1 (“Proceeding”), and click “Retrieve Document List.” Comments will be listed starting with the most recent filings. Allow a few days after July 21 for mailed comments to be posted.
Following Monday’s comment period deadline, another 30 days (ending August 19) will be provided for reply comments. These can be filed in the same manner as discussed above.
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| Earlier this week, the House Energy and Commerce Committee, chaired by Rep. Billy Tauzin (R-La.), stepped up its investigation of the E-rate program by sending inquiries to 15 E-rate vendors (including IBM and SBC Communications). A spokesman for the Committee stated “Based on some of the evidence that we've reviewed already, it's clear that some vendors have gamed the system. We're trying to find out whether these are just isolated incidents or are part of a greater pattern of abuse.” The Committee also indicated that it would hold a hearing on E-rate fraud in the fall.
It is important to note that there is no indication in the Committee’s letters that the recipients were chosen because of perceived program abuses, only that they had “significant involvement in the E-rate program.” In particular, the president of one of the companies is a board member of USAC, the SLD’s parent company.
Some of the questions posed in the letters, however, are indicative of problems being explored. Among the more interesting requests for data were the following:
(1) “A list of all E-rate clients and, for each such client, explain the types of services performed and the amount of money received for such services during each year of the relevant time period. Provide all contracts and agreements relating to such services.”
(2) “All records relating to the marketing or promotion of your E-rate services, including but not limited to (i) internal records relating to plans, policies, or practices to increase or improve your E-rate business; and (ii) records relating to communications with clients or potential clients regarding increasing or maximizing E-rate funding.”
(3) “All records relating to the provision of assistance by your company to any E-rate applicant regarding development of its Form 470 or Form 471 submission to USAC.”
(4) “All records relating to any request, offer, promise, commitment or agreement, whether written or oral, between you and any potential E-rate applicant, under which your company would provide, either directly or indirectly through any third party, financial assistance to such applicant to help it meet its required share of E-rate-funded costs, including but not limited to any request or offer of free or reduced cost services or equipment or assistance.”
The full text of a representative letter, plus a list of the 13 recipients (excluding IBM and Alpha Telecom, mentioned in a separate release), is available on the Committee’s Web site.
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