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In This Week's Issue
» Funding Status Update
» FCC Appeals and Due Dates
» E-Rate Updates and Reminders
» Schools and Libraries News Brief dated June 14 – CIPA Reminders

E-Rate Central News for the Week
June 17, 2013

Introduction

The E-Rate Central News for the Week is prepared by E-Rate Central. E-Rate Central specializes in providing consulting, compliance, and forms processing services to E-rate applicants. To learn more about our services, please contact us by phone (516-801-7804), fax (516-801-7814), or through our Contact Us Web form. Additional E-rate information is located on the E-Rate Central Web site.

Funding Status

Wave 5 for FY 2013 will be released on Tuesday, June 18, 2013, for $11.6 million.  Funding is currently being provided for Priority 1 services only.  Cumulative funding for FY 2013 will be $176 million.

Wave 48 for FY 2012 will be released on Wednesday, June 19, 2013, for $58.5 million.  Priority 2 funding is being provided at 90%, and is being denied at 89% and below.  Cumulative funding for FY 2012 will be $2.52 billion.

Wave 96 for FY 2011 will be released on Thursday, June 20, 2013.  Priority 2 requests are being funded at 88% and above, and denied at 87% and below.  Cumulative funding for FY 2011 is $2.60 billion.

Wave 114 for FY 2010 will be released on Tuesday, June 18, 2013, providing $5.35 million for two applicants.  Priority 2 funding is being provided at all discount levels.  Cumulative funding for FY 2010 will be $3.06 billion.

FCC Appeals and Due Dates

The FCC published an interesting appeal decision last week for Dooly County SD (FCC 13-81) which led to broad confusion regarding types of FCC appeals, methods for filing, and filing deadlines.  Apparently anticipating this confusion, the FCC indicated that once the Dooly “clarifications” take effect (30 days after publication in the Federal Register), the FCC “will issue a Public Notice announcing their effectiveness and explaining the correct procedures.”

FCC appeal procedures can get a little complex — one reason E-rate applicants often seek third-party assistance — so let’s see if we can better explain the Dooly decision without waiting for the promised Public Notice.

The actual situation Dooly appealed was pretty straight-forward.  It dealt with the 28-day waiting period required under the FCC’s competitive bidding rules.  An applicant using an RFP, must so indicate in its Form 470, and must keep the bidding process open for 28 days.  If the RFP and Form 470 are issued on different days, the Allowable Vendor Selection date is 28 days from the later filing.  In Dooly’s case, the bidding window was closed short of the 28-day waiting period, and USAC had denied the FRN.  Dooly had then appealed to the FCC’s Wireline Competition Bureau (“WCB”).  Although the FCC has waived the 28-day rule in the past, it has done so only when the applicant missed compliance by three days or less.  In the Dooly case, it was more than three days and the WCB denied the initial appeal.  In last week’s decision, the full Commission denied Dooly’s appeal, not so much on the merits of the appeal, but because it had not been filed within the 30-day appeal window.

This is where the confusion arose.  Knowing that its appeal was being submitted more than 30 days after receiving the initial WCB appeal denial, Dooly filed its Application for Review to the full Commission citing, as a technicality, that it had 60 days to do so.  The Commission decision rejected this argument, clarifying that Dooly should have filed a Petition for Reconsideration which must be filed within 30 days.

It is important to understand the number of ways — and associated terminology — in which adverse E-rate decisions may be appealed.  Specifically:

  1. USAC decisions can be appealed directly to USAC.  This course of action is particularly appropriate if the applicant believes that USAC erred in its decision, perhaps by not fully considering applicant documentation.  The deadline for filing a USAC appeal is 60 days.

USAC, however, only administers the E-rate program.  It can neither interpret nor waive E-rate rules.  Appeals of this nature must go the FCC.

  1. USAC decisions, including denials of USAC appeals, can be appealed, via a “Request for Review,” to the FCC’s WCB.  As of 2003, in the FCC’s Second Report and Order (FCC 03-101), a Request for Review must be filed within 60 days.  Nothing in the Dooly decision affects this deadline.
  2. If the FCC Request for Review is denied by the WCB, an applicant may file an “Application for Review” with the full Commission based on the same set of facts and arguments.  If the applicant wishes to present other facts, it can file a “Petition for Reconsideration” with either the WCB or the full Commission.  In any of these instances, the appeal window is 30 days.

Note that an applicant can thus file at least 5 appeals of a USAC decision, namely:

  1. Appeal to USAC;
  2. Request for Review to the WCB;
  3. Petition for Reconsideration to the WCB;
  4. Application for Review to the full Commission; and/or
  5. Petition for Reconsideration to the full Commission.

And if those actions don’t work, the applicant can always sue in federal court (although we’ve never seen that action taken by an E-rate applicant).

The Dooly case “technicality” issue requires a little background.  In 2001, in an Interim Filing Procedures Order issued in response to mailing delays associated with the 9/11 terrorist attacks and tainted letters, the FCC temporarily extended the filing deadline for Applications for Review to 60 days and permitted filings by fax and e-mail.  The 2003 Second Report and Order (referenced above) did not specifically address this extended deadline and these procedures.  In 2007, in an Interim Filing Procedures Rescission Order, the FCC rescinded all emergency filing procedures, but did not specifically address Applications for Review for USAC-related matters.  Dooly argued, therefore, that the 60-day window was still in effect for E-rate Applications for Review.  In last week’s order, the FCC “clarified” that the 30-day window applies to E-rate Applications for Review, that such reviews cannot be filed by fax or e-mail (i.e., only by regular mail or via the FCC’s online filing system), and that it will provide further clarification when the Dooly Order becomes effective.

E-Rate Updates and Reminders

SLD Fall Applicant Training Schedule:

The SLD has scheduled eight one-day applicant training sessions this fall from late September through early November.  As of last Friday, the Washington, DC session was closed, and registrations were being accepted on a waiting list only basis for Atlanta, Houston, Los Angeles, Newark, and St. Louis.  Regular registrations are still being accepted for Minneapolis (10/15) and Portland (11/7), but less than 95 spaces are available in total.

New Comments Filed on Lowest Corresponding Price:

The Telephone Company filed FCC comments two weeks ago responding to earlier comments filed by CTIA – The Wireless Association regarding E-rate’s Lowest Corresponding Price (“LCP”) requirement.  In the reply comments filed last April on proposed changes to the FCC Form 473, CTIA had argued that service providers should not be required to certify LCP compliance before the FCC acted on a USTA/CTIA joint petition filed in 2010 seeking a declaratory ruling clarifying certain aspects of LCP.  (For a summary of LCP issues, see our newsletter of October 29, 2012.)

The Telephone Company, a specialized telephone auditing firm focusing on potential LCP discrepancies in carrier billing, argued that “the LCP rule has always been clear” and that the rule should be “strictly enforced and monitored.”  The firm’s filing last week is significant because it comes on the heels of what we understand to be the firm’s existing whistleblower cases that are no longer under seal and which document alleged LCP violations.  To date, the FCC has declined to further clarify the LCP rule — seemingly agreeing that the rule is clear — but has taken few steps to enforce it.  The Telephone Company’s actions could bring the LCP issues to a head.

E-rate applicants should note that vendor refunds on eligible services, whether based on LCP or other billing discrepancies, may require the applicants to repay the discounted portions of those refunds to USAC.

FCC Chairman Confirmation Hearing:

Chairman Jay Rockefeller (D, WV) of the Senate Committee on Commerce, Science, and Transportation announced that the Committee will hold a hearing on the nomination of Thomas Wheeler to be Chairman of the FCC.  The hearing will be held at 2:30 EDT on Tuesday, June 18th and will be webcast live.  In light of President Obama’s recent ConnectED initiative setting a five-year target for broadband Internet of at least 100 Mbps per school (see our newsletter of June 10, 2013), we expect Senator Rockefeller and other Committee members to question Mr. Wheeler on his plans or thoughts for modernizing and funding the E-rate program.

New Verizon Wireless E-rate Discount Procedure:

Verizon Wireless is sending e-mails to its E-rate customers asking them to register their account numbers online and to send them copies of their related Item 21 attachments.  Registration is required whether the applicants want to receive their discounts via credits on their monthly bills (i.e., the SPI process) or via periodic reimbursements (i.e., the BEAR process).  While Verizon Wireless has long required registration for SPIs, this is a new requirement for BEARs.

In either case, registration is not difficult, but the instruction for sending the Item 21 attachments is a bit confusing.  The e-mail requesting registration is from the e-mail address Erate_slcforms@VerizonWireless.com.  The subject line includes the comment “(Please do not reply to Erate_slcforms).”  The instruction for e-mailing the Item 21 attachments, however, indicates that they are to be sent to that address.  If you do, you get an automatic reply indicating that the e-mail address is not monitored and, if you have questions, to e-mail the general E-rate e-mail address, Erate@VerizonWireless.com.  Based on our inquiry, Verizon Wireless has clarified that it does want Item 21 attachments sent to the Erate_slcforms’ address and that the “reason for the out of office message is that we do not want other erate communication going there.”

FCC Requests Comments on Three Appeals:

The FCC has requested comments on three applicant appeals (DA 13-1350, DA 13-1351, and DA 13-1352).  Although all three appeals involve Rural Health program applicants, and therefore are not directly related to E-rate, the issues appear comparable.  In particular:

  1. The Arkansas Department of Information appeal involves an adjustment to a service end date involving a contractual service date extension.
  2. The Ozark Guidance Center appeal involves a competitive bidding issue in which potential bidders, once told that Ozark had received a bid from its existing carrier, declined to submit competing bids.
  3. The Southcentral Foundation appeal involves “inaccurate filing guidance” provided by USAC.

All three Public Notices have a comment due date of June 27, 2013, and a reply comment due date of July 5, 2013.

Schools and Libraries News Brief Dated June 14 – CIPA Reminders

The SLD News Brief for June 14, 2013, reviews the basic requirements for compliance with the Children’s Internet Protection Act (“CIPA”).  Applicants applying for services other than telecommunications (i.e., Internet Access and/or Internal Connections) must certify CIPA compliance on their Form 486s and should be prepared to provide the following documentation:

  • Existence of an Internet safety policy including, as of FY 2012, provisions for education of minors about appropriate online behavior.
  • Evidence of a public notice and a public hearing or meeting preceding the adoption of the Internet safety policy.
  • Evidence (e.g., logs) that a technology protection measure (filter) was in place and working.
Disclaimer: This newsletter may contain unofficial information on prospective E-rate developments and/or may reflect our own interpretations of E-rate practices and regulations. Such information is provided for planning and guidance purposes only. It is not meant, in any way, to supplant official announcements and instructions provided by either the SLD or the FCC.