News of the Week

Funding Status

Wave 10 for FY 2011 will be released on Tuesday, August 23rd.  Cumulative funding for FY 2011 is currently $711 million.  Only Priority 1 applications are being funded at this time.

Wave 63 for FY 2010 will be released on Thursday, August 25th.  Cumulative funding for FY 2010 is $2.56 billion.  Priority 2 funding is still being awarded at 81% and above, and denied at 79% and below.

FCC action is expected shortly — hopefully within the next week or two — on the use of the recently announced $1.1 billion in available roll-over funds.  The decision could affect both FY 2010 and FY 2011 funding as follows:

FY 2010:   The FCC may or may not roll over a portion of the available funds to FY 2010.  Presumably, if it does, the additional funding would be used to fund Priority 2 requests at the 80% discount level.  If it does not, the Priority 2 funding threshold for FY 2010 is likely to be finalized at 81%.

FY 2011:   Regardless of whether the FCC rolls over all or just the majority of the available funds to FY 2011, the most immediate impact should be the beginning of Priority 2 funding for FY 2011, most likely starting with funding only at the 90% level.

Wave 91 for FY 2009 will be released on Monday, August 22nd.  Cumulative funding for FY 2009 is $2.86 billion.

SECA Proposes Enhancements to E-Rate Rules, Forms, and Procedures

When the FCC released its 6th Report & Order (FCC 10-75) last September, it characterized its rule changes as the “first stage in a multi-stage upgrade of the E-rate program.”  With the expectation that the FCC may be planning to issue another Notice of Proposed Rulemaking (“NPRM”) later this year, the State E-Rate Coordinators’ Alliance (“SECA”) filed an ex parte white paper last week discussing and proposing solutions surrounding five important issues.  A summary of the SECA filing is provided below.

Invoice Process Improvements:

SECA proposes the following changes to the FCC invoicing rules and USAC procedures:

1. Direct BEAR reimbursement payments to applicants:  This would replace the current and cumbersome process of routing these reimbursements through service providers.
2. Automatic deadline extensions for “zero-funded” invoices:  This would be a particularly welcome change when invoices are submitted close to invoice filing deadlines, but rejected by USAC for various errors requiring re-submittal.  Under current procedures, the applicants or service providers must file invoice deadline extension requests (that are routinely granted if filed in a timely manner), wait for them to be approved, and then resubmit corrected invoices.
3. Problem resolution outreach to correct BEAR errors:  Currently, USAC will summarily reject BEARs for a variety of issues that could be easily resolved with a simple phone call or e-mail exchange with the applicants, avoiding the need for BEAR re-submittals.
4. Enhancements to the online BEAR system:  SECA recommends that the online BEAR filing system be modified to permit BEARs to be prepared by individuals, including consultants, who do not have PINs.  This would parallel the online form preparation systems employed for other E-rate forms.
5. USAC outreach on unfiled FRN invoices:  As already occurs with respect to unreferenced Form 470s or unfiled Item 21 attachments, SECA recommends that USAC contact any applicant (and/or service provider) within 20 days of the normal invoice deadline if there have been no invoices filed against specific FRNs.

Priority 2 Reform:

Noting that Priority 2 funding, at or below the 80% level, has become increasingly rare, and that future funding at even the 90% level may be suspect, SECA proposes that the maximum discount on Priority 2 funding be scaled back to 75%.  This proposal has been made by several parties in the past — and has drawn fire by applicants at the 90% discount level — but may carry more weight now in light of the upward trend in Priority 1 demand and the resulting squeeze on available Priority 2 funding.

Modernized Online E-rate Portal:

SECA reiterates a proposal it has made previously that the SLD’s online system be upgraded to provide an integrated “E-rate Portal” whereby applicants would be able to file all forms and requests (including SPIN changes, service substitutions, etc.), to store and access past filings, and to receive electronic notifications of form and invoicing status in a paperless manner.

Comprehensive Requirements Manual:

SECA stresses the need for an “All-in-One Place” source of E-rate rules and procedures to consolidate all the sources of program guidance “currently spread all over the SLD website:  the reference area, training PowerPoint slides that are unsearchable from the USAC Website, FAQ’s, SLD News Briefs, etc.”  The “Comprehensive E-rate Requirements Manual” should be available online with clearly noted updates (and links to previous rules and procedures applicable to earlier funding years).

Further Form 470 Revisions:

Although the Form 470 has been recently revised, SECA proposes several additional changes that should be made “…to remove the remaining ‘gotchas’ on the form.”  The proposed changes would eliminate the funding year default (that makes it difficult to file Form 470s during portions of the year), and would replace current four-category service listings with simpler, two-category (Priority 1 and Priority 2) service listings (avoiding applicant errors in posting requirements for services that are increasingly indistinguishable, particularly between Telecommunications and Internet Access).

E-Rate Updates and Reminders

Pending FCC E-Rate Actions:

There are at least four important FCC actions we expect to see between now and the end of the year.  They include:

1. A decision on the use of $1.1 billion in available roll-over funding (see the Funding Status information above and our newsletter of August 8, 2011).
2. A request for public comments on USAC’s FCC filing asking for further guidance on E-rate gift rules (see USAC letter and our newsletter also of August 8, 2011).
3. A request for public comments on CIPA requirements pertaining to the on-site use of portable devices owned by students and library patrons (see the recent CIPA Order (FCC 11-125), and our newsletter of August 15, 2011).
4. A major Notice of Proposed Rulemaking concerning possible changes to the E-rate rules expected to become effective by FY 2012 or FY 2013.  The SECA proposals discussed above suggest some of the topics which might be covered by this NPRM.

E-Rate Central’s Updated CIPA Primer:

As noted above, the FCC recently updated its CIPA rules (FCC 11-125) to incorporate the requirement of the Protecting Children in the 21st Century Act that school Internet safety policies include a provision “for educating minors about appropriate online behavior, including interacting with other individuals on social networking websites and in chat rooms and cyberbullying awareness and response."

E-Rate Central has updated its CIPA Primer to incorporate the latest FCC changes.  Please note that the sample Internet Safety Policy included in this primer was developed by E-Rate Central solely to address the basic policy compliance requirements of CIPA and NCIPA for E-rate funding.  Schools and libraries adopting new or revised Internet policies may wish to expand or modify the sample policy language to meet broader policy, acceptable use, and other local objectives.  Neither the FCC nor the SLD has established specific standards for a CIPA-compliant Internet Safety Policy, and neither has reviewed, much less endorsed, this sample policy.

Schools and Libraries News Brief dated August 19 – Non-Recurring Services

The SLD’s News Brief for August 19, 2011, briefly described the difference between recurring (such as telephone, Internet, or maintenance services used throughout the year) and non-recurring (e.g. one-time installation services) services.  Unlike recurring services, which must be used within funding years ending June 30th, non-recurring services can be provided through September 30th of the following funding year — a deadline that, in many cases, can be extended.

Last week’s News Brief also discusses the process for requesting a service delivery deadline extension for non-recurring services.