Funding Status
The FY 2012 Form 471 application filing window is closed. The next step, expected by mid-April, is for USAC to release a preliminary estimate of FY 2012 demand. The first funding wave for FY 2012 is expected in May.
Wave 41 for FY 2011 will be released on Tuesday, April 3rd, for $60.1 million. Cumulative funding for FY 2011 will be $2.08 billion. Priority 2 funding for FY 2011 is currently being provided only at the 90% level and is being denied at 79% and below.
Wave 92 for FY 2010 will be released on Wednesday, April 4th, for $3.7 million. Cumulative funding for FY 2010 will be $3.04 billion. Priority 2 funding is being provided at all discount levels.
E-Rate Updates and Reminders
Last Week's FCC Appeal Decision:
The FCC released another appeal order (DA 12-489) last week following up on three audit findings involving equipment purchased with E-rate funds that had either not been installed or that was no longer installed. In each case, the FCC concurred with USAC's decision to rescind funding and to seek recovery of funds.
As has been the case in many recent appeal orders, the FCC provided little justification for its findings other than that they were "consistent with precedent." In this case, however, a review of the initial appeals indicates how strict the FCC is prepared to be in enforcing its equipment installation expectations. The three denied appeals involved the following situations:
- In the course of installing approximately three dozen wireless access points ("WAPs"), one WAP was initially kept in reserve and was not finally installed until much later. An interesting sidebar to this denial is that the total amount of the COMAD was $388 — a figure that many would consider de minimis and which is probably lower than the expenses incurred by the applicant, USAC, and the FCC in handling this appeal.
- Seven Cisco switches were apparently stolen from a school by a technician who reinstalled older switches to hide the theft. Although the school subsequently replaced the equipment at its own expense ("effectively replacing the missing equipment"), the school was subject to a COMAD for the E-rate portion of the stolen switches.
- Funding was being recovered for invoiced maintenance expenses associated with the cleaning and testing of equipment taken out of service and returned to the district warehouse for subsequent redeployment.
It should also be noted that the FCC's order in this case did approve a separate appeal by one of the three applicants — a charter school in the District of Columbia, whose funding was to be reduced as the result of an audit finding that pre-K students had incorrectly been included in its discount rate calculation. USAC, at the time, had listed pre-K students as ineligible. The school argued, and the FCC concurred, that "District law empowers its Public Charter School Board to ensure that charter schools meet the requirements and goals of the Pre-K Education System," and that pre-K students in DC should therefore be E-rate eligible. USAC's Eligibility Table for Non-traditional K-12 Students and Facilities has already been updated to reflect the DC change. This decision may set a precedent for other applicants to argue that their state laws also permit a broader definition of student eligibility.
USAC Annual Report for 2011:
The 2011 USAC Annual Report was released last week. One of the more interesting aspects of the report is a discussion of the ramp up of USAC's "program integrity activities" — read "audits" — in 2011 involving all four Universal Service Fund ("USF") programs. Activities included the Payment Quality Assurance ("PQA") Program with over 1,600 assessments of individual payments. For E-rate, PQA tests showed improper payments of 0.94%. The three other programs also had comparatively low rates of improper payments. Only 60 audits, across all four USF programs, were completed in the more intensive Beneficiary and Contributor Audit Program ("BCAP") in 2011, although this rate is expected to expand to over 340 per year beginning in 2012.
Other information on E-rate in the 2011 report includes a summary of 2011 highlights (p. 14) and numerous statistics (pp. 14, 18, 46-47). The financial section shows program-specific balance sheets (pp. 20, 33) and the status of three legal complaints filed by service providers seeking release of E-rate funding (pp. 30-31).
Comment Deadline on E-Rate Digital Literacy Issues:
Today, April 2nd, is the deadline for submitting comments on the FCC's NPRM on the Low-Income program, which includes a proposal to administer broadband digital literacy training through the E-rate mechanism (see our newsletter of February 13th). We will include a summary of E-rate-related comments in next week's newsletter. Reply comments are due May 1st.
Schools and Libraries News Brief Dated March 30 – Form 471 Status Tool
Last week's SLD News Brief for March 30, 2012, reviews the information that is available online regarding the status of an applicant's application(s). This information may be found using the SLD's Form 471 Application Status Tool. In summary, if everything goes smoothly — as it does for the vast majority of applications — the Status Tool will show the following progression:
- Certified – In Window
- Initial Review
- Final Review
- Quality Assurance 1 or 2
- FCDL Issued – [date]
If a problem arises during the application review process, one of the following status designations may be shown:
- Unable to Contact
- Deferred
- Awaiting Applicant Documentation
- Held for further review and other verification
An applicant seeing any of the first three designations should contact its PIA reviewer to get the application back on track. Little can usually be done in the fourth instance, except to wait until USAC and/or the FCC resolve the outstanding issue(s).