Longer Term Administration Plans for E-Rate
The Bush Administration’s FY 2002 Budget request, that will be much discussed over the coming months but will not be acted upon until this fall, contains a special section dealing with proposed changes to the E-rate program. Unlike an earlier Bush proposal, that would have combined E-rate with other federal technology programs under the direction of the Department of Education, the current proposal retains the Universal Service funding aspects of the program under control of the FCC. It does, however, direct the FCC to come up with new rules by September 30, 2002, to realign the E-rate program to meet earlier Bush education goals. There is no indication whether such rules, if enacted, would first affect funding for PY5 or PY6.
Specifically, the Budget request proposes that E-rate rules be changed to:
- Allocate discount funds using a "need-based formula" consistent with the Department of Education’s ESEA funding, albeit with additional provisions for accommodating funding for private schools and libraries.
- Define eligible services "to include additional services that promote the effective use of telecommunications and information services, such as teacher training and software."
- Coordinate E-rate funding with ESEA funding under "an overall technology plan."
- Include provisions "to assess improvements in student learning."
Bush’s E-rate proposal can be found in the 2002 Budget Appendix at the White House Web site (see page 243, Sec. 623).
The FCC has recently released several appeal decisions that uphold the SLD’s right to deny funding to applicants who fail to demonstrate that they have the necessary resources to make effective use of requested funding. Applicants are required to certify that they have these resources in their Form 471 applications (at Item 22 for PY1 and PY2, and at Item 25 for PY3 and PY4). The SLD has special review procedures that are undertaken when certain funding request thresholds are triggered.
The FCC appeals provide examples of possible application review problems. In one case, the SLD had denied funding to a small school (60 students) that had requested $205,000 in funding for 3 servers and 48 lines, a much larger network configuration than would be needed to support the 14 computers it had planned to install by year end. The school could not, or did not, explain "that its technology plan provided adequate levels of budgeted funds to obtain necessary resources and to train staff, acquire software, retrofit buildings, and maintain the services…" for a network of this size. .
In another case, at the other end of the spectrum, the SLD denied a state education department request for statewide Internet funding when the department could not, or did not, demonstrate that the department’s consortium members had secured access to the necessary resources. Since the actual request was for dial-up Internet services, which would not seem to require many resources from individual applicants, we suspect that the SLD was more concerned with the overall scope of the consortium program and the lack of formal commitments by the potential members.
At least two timely lessons can be learned from these two cases.
- Applicants receiving Item 25 Reviews on their PY4 applications should treat the information requests seriously, providing thorough and timely responses. We suggest working closely with the SLD reviewer to determine exactly what information is required and, once submitted, whether the information is complete. If requests have been made for services that, in hindsight, will not be needed, it may be possible to reduce the requests, in line with documentation submitted, to avoid determinations that adequate supporting resources are not available.
- Consortium applicants bear additional responsibilities when they certify that all their members have secured all necessary resources (and have technology plans) to utilize consortium services. The best way to do this is for the consortium leaders to obtain letters of agency from all — and we stress "all" — their members. The letters should indicate not only that the members are authorizing the consortium leaders to request discounts on their behalf, but that they certify that they meet all E-rate conditions. The subject of letters of agency, including sample language, was discussed in our News of the Week of 12/4 – 12/8/00.
Certain applicants, who manually filed large PY4 applications using the SLD’s Excel form, have subsequently found that the process they used to duplicate Block 4 or Block 5 pages did not include the page footer information (indicating page number and "FCC Form 471 – October 2000"). The SLD is questioning whether pages that are missing this information are valid.
All PY4 applicants, who filed manually, should check their application copies to make sure that all footers were properly included. New York State applicants who find problems in this regard are encouraged to contact us.