News of the Week

Funding Status

The SLD has announced that the FY 2014 application window will open Thursday, January 9, 2014, at noon EST, and will close on Wednesday, March 26, 2014 at 11:59 p.m. EDT.

Wave 32 for FY 2013 will be released on Friday, December 27, 2013.  Funding is currently being provided for Priority 1 services only.  Cumulative funding for FY 2013 will be $1.62 billion.

Wave 73 for FY 2012 will be released the following Monday, December 30, 2013.  Priority 2 funding is being provided at 90%, and is being denied at 89% and below.  Cumulative funding for FY 2012 is $2.81 billion.

Transition to the Revised Form 470

Last Thursday, USAC announced the approval of revised versions of the Form 470, Form 471, and associated instructions.  The new paper versions of these forms can be identified by the date “December 2013” at the bottom of each page.  Blank copies of the revised paper forms are available in the Forms section of the SLD’s website and in type-in PDF versions on E-Rate Central’s Forms Rack.

Repercussions of the Form 470 Revision:

As a matter of substance, there are two changes to the new Form 470.  The most noticeable change is that Item 8, which used to list Telecommunications services, and Item 9, which listed Internet Access services, have been combined into a new Item 8 to list any and all desired Priority 1 services.  One other minor change is the addition of “(or whatever retention period is required by the rules in effect at the time of this certification)” to the Item 19 certification to cover a possible change to the E-rate document retention rules proposed in the E-Rate 2.0 NPRM (FCC 13-100).

For online filers, the older version of the Form 470 (designated “October 2010”) was deactivated Thursday at 6:00 p.m. EST.  The new version of the Form 470 was brought online on last Friday.  The new version of the Form 471 will not be available online until the FY 2014 application opens on January 9th.

The flash cut to the new version of the Form 470 will require some extra work for applicants who had started, but not completed, the full Form 470 filing process using the older version of the Form 470.  Completion of the full filing process means that a Form 470 has been posted on the SLD’s website and has been certified.  Often, posting and certifying are separate steps.

To check on the status of any particular FY 2014 Form 470, do the following:

1. Go to the Apply Online section of the SLD website.
2. Click on the Form 470 “Search Posted” link.
3. Click “Next” for the default “Year 2014.”
4. Enter the 15-digit “Form 470 Application Number” in the appropriate search field, and click “Next” again.
5. The application status will show either “COMPLETE” or “CERTIFIED.”
6. For further assurance and to see the entire application, click on the application shown and check the entry in the “Application Status” field.

In following these steps, three outcomes are possible.  Here’s what they mean:

1. If, after Step 4 above, the result shows “The search did not locate an application with your criteria,” it means that the application with that number has not been completed and submitted online.
2. If, at Step 5, the application Status is shown as “COMPLETE,” it means that the application was submitted and has been posted (which starts the 28-day procurement clock), but has not yet been certified.  Certification is required before a Form 470 can be used in the Form 471 application and review process.
3. If, at Step 5, the application Status is shown as “CERTIFIED,” it means that the application has been both posted and certified.  Nothing else needs to be done on this application.

Outcomes #1 or #2 above require further action.

For Online Filers:

If an online Form 470 was submitted using the older version of the Form 470, but not certified, it must now be certified using the new version (the only real difference being the additional parenthetical reference to the document retention rule).  In the Apply Online section of the SLD’s website, click the Form 470 “Certify Complete” link, enter the Form 470 number, and select either “Electronic Certification” or “Paper Certification.”  If you have a PIN, do it electronically.  To certify on paper, printout, sign, and date the new three-page certification and mail it to USAC.  If you had previously printed out the old version of the paper certification, it will no longer be accepted.  If the old version had already been signed and mailed, but had not been entered by USAC before the new version became effective, you will undoubtedly be contacted by Problem Resolution asking you to resubmit the certification in the new version.

If an online Form 470 was partially completed before last Friday, using the old version, an applicant can continue to file without starting a new Form 470 using the “Continue Incomplete” option.  Fortunately, most of the original information that had been entered has been retained, just reformatted a bit to reflect the new version which combines the Telecommunications and Internet Access categories into a single Priority 1 category.

The critical factor to note when continuing online filing from the old version of the form is that the Telecommunications services previously listed will have been carried forward into the new Priority 1 list.  But, — and this is a big “BUT” — any previously entered Internet services will have been eliminated and must be relisted in the new Priority 1 list.  If this is not done, the new Form 470 will be filed without referencing these missing Internet services.

For Paper Filers:

Any applicant using the old version of a paper Form 470 now has only one option; redo the work on the new version.  This would also include any applicant whose old paper Form 470 had already been mailed to USAC, but had not been data entered prior to last Thursday’s cutoff.

One Complication in the Form 471 Revision Process:

One interesting, but hopefully insignificant, aspect of the release of the revised Form 471 was an FCC Public Notice (DA 13-2431) extending the comment period for revisions to the Form 471 Instructions.  This stemmed from a “clerical” error by which the new Form 471 Instructions had not been posted on the OMB website during the OMB’s 30-day Form 470 and Form 471 comment period.  To correct this problem, the FCC set a very short extended comment period with a deadline of January 2, 2014.  Hopefully, no comments will be submitted to derail the instructions (even though there are a number of editing errors in the new Instructions) and/or the use of the revised Form 471 that could affect the opening of the FY 2014 application window.

E-Rate Updates and Reminders

Form 486 Deadlines:

Typically, a Form 486 must be filed no later than 120 days from FCDL issuance or the start of service, whichever is later.  Assuming services started July 1, 2013, the deadlines for early FY 2013 funding waves 1-14 have already passed.  The last comparable deadline for 2013, for those funded in Wave 15, is December 26th.  The first few Form 486 deadlines for early 2014 are:

                      Wave 16                01/03/2014
                      Wave 17                01/19/2014
                      Wave 18                01/16/2014
                      Wave 19                01/23/2014
                      Wave 20                01/30/2014

FCC Appeal Decisions Watch:

The FCC released the following two appeal decisions last week:

• Albert Wisner Public Library et al (DA 13-2428):  The FCC approved waiver requests of Form 471 filing deadlines for 23 applicants, and denied waiver requests for Form 471 filing deadlines (or related petitions for reconsideration) for 42 other applicants.  Consistent with past precedents, the approved waivers were granted to those applicants who had filed their Form 471 applications within 14 days of the close of the window, had filed timely applications missing Item 21 attachments and/or certifications, or who cited compelling special circumstances (typically deaths, severe illnesses, or overseas military deployment).

• Coolidge Unified School District 21 (DA 13-2429):  The FCC granted three requests for review by Coolidge UFD involving the E-rate competitive bidding rules.  In these cases, USAC had determined that the district’s bid assessment process had not assigned the highest weight to the price of eligible services.  What Coolidge had done was to assign the highest weight to the total price of both eligible and ineligible goods and services.

This is a critical distinction.  E-rate rules require that the primary price factor be linked specifically to eligibility.  The rationale is that if only total price was considered, it would create an incentive for the parties to agree to inflated prices for eligible services, offset by lower prices for ineligible services, in order to maximize discounts.  Unfortunately, many state and local procurement rules require adherence to lowest total cost standards.  So what’s an applicant to do?  The answer lies in the E-rate rules’ flexibility to recognize factors other than price of eligible services — one possibility for such a factor being the price of ineligible services.
In this particular case, Coolidge was able to carefully show that its same bid analysis process would have yielded the same results if only the price of eligible services had been weighted the highest.  The FCC agreed with USAC that there had been a technical violation but, in the absence of any waste, fraud, and abuse, and with the finding that the actual outcome wasn’t tainted by the violation, it waived the eligible price rule.  The lesson for all, so as not to rely on an FCC waiver, is to remember that the E-rate rules focus on eligible service prices.

Schools and Libraries News Brief Dated December 20 – PQAs and Winter PIA Contacts

The SLD News Brief for December 20, 2013, covers the following two topics:

1. The 2014 Payment Quality Assurance ("PQA") program is starting again in January.  This is an ongoing mini-audit process which looks at randomly selected invoice payments to determine if the payments were properly made.  The process is a statistical requirement of the federal Improper Payments Elimination and Recovery Act of 2010 ("IPERA").  If an invoice is selected for review, USAC will ask the applicant to produce documentation verifying the procurement, funding, and use of the related product or service.
2. The winter contact period began on Friday, December 20th, and continues through Friday, January 3rd.  This is a shortened, two-week version of the summer deferment period designed to avoid contacting applicants for PIA purposes during times when those applicants may be on vacation.