News of the Week

FY 2017:

Wave 12 for FY 2017 was released Friday, August 18th, for a total of $90.8 million. Cumulative national funding through Wave 12 is $881 million ($737 million for Category 1, $144 million for Category 2). A scheduled release date for Wave 13 has not been announced.

FY 2016:

Wave 59 for FY 2016 was released on Tuesday, August 15th, for a total of $0.00 — representing one denied application. As a result, cumulative national funding through Wave 59 remains $2.91 billion. A scheduled release date for Wave 60 has not been announced.

FY 2017 SPIN Changes:

EPC is not yet set up to accept, much less process, SPIN changes for FY 2017 FRNs. It is expected that SPIN change requests will be accepted in EPC by month end, but the system may not be able to report on approved SPIN changes until sometime in October.

Applicants needing to make SPIN changes who have not yet been funded are encouraged to submit those changes via RAL corrections which can be processed by PIA.

FY 2016 SCDER Submission and Review:

FCC rules require that special construction fiber systems are to be completed by the end of the funding year. Completion means that all fiber circuits have been installed and are lit. For applicants approved for, or still seeking, funding in FY 2016, the construction deadline was June 30, 2017. Recognizing that this might be a tight deadline, particularly for applicants with larger network projects and/or those receiving late Funding Commitment Decision Letters (“FCDLs”), the FCC authorized USAC to extend this deadline upon request by one year. Initially, Special Construction Deadline Extension Requests (“SCDERs”) were to be submitted using a USAC template. The guidance was subsequently changed advising applicants to use the Form 500 instead.

Note that one unique aspect of the fiber completion deadline of June 30th is that it departed from the traditional September 30th deadline applied to all other non-recurring (i.e., one-time) services. We suspect that the June vs. September deadlines may have confused some applicants. Importantly, for any applicant who missed a fiber deadline and may have to appeal, there are indications that USAC too was confused. In particular:

• USAC News Briefs leading up to June 30th did not discuss the impending completion deadline nor the concurrent SCDER filing deadline.

• More importantly, USAC did not confirm the requirement to file a SCDER by June 30th until later in July. Indeed, the EPC version of the Form 500, which can be used to file a SCDER, still indicates that the deadline to request a service delivery extension for fiber construction is September 30th.
  
  

Applicants who did submit SCDERs by June 30th are reporting differing review procedures based on FCDL and SCDER timing. Those filing SCDERs before receiving FCDLs have been receiving extension approvals without questions. Those filing SCDERs after receiving FCDLs are getting detailed review questions asking why the initial June 30th deadline could not be met. Even those receiving FCDLs late in the funding year or after June 30th are being asked, apparently with a straight-face, to “describe in detail why the construction couldn’t begin before the FCDL was issued.”

Applicants who need extensions, but did not submit SCDERs by June 30th, are in an interesting position. We have not yet seen how USAC plans to handle late-filed SCDERs. In the best of all worlds, given the misleading Form 500 guidance, the FCC will give USAC the authority to waive the June 30th deadline for those applicants submitting their SCDERs on or before September 30th. If not, these applicants will likely need to appeal. As part of the documentation for such an appeal, we recommend that applicants print a copy of their Form 500 SCDER submission — and do so now before USAC corrects the EPC Form 500 language.

Upcoming 2017 E-Rate Deadlines:

USAC’s Schools and Libraries News Brief of August 18, 2017, continues a Form 498 discussion begun in last week’s News Brief. To review, the Form 498 is important to applicants planning to file BEAR invoices. The Form 498 provides USAC with the bank account information required to send reimbursement payments directly and electronically to the applicants. Applicants, who already have approved Form 498s, need read no further.

This week’s News Brief discusses how USAC reviews and confirms:

• The bank account number and bank routing number
• The FCC Registration Number (FCC RN, not BEN) and Federal EIN (tax ID)

The News Brief also discusses:

• How to ensure that entities who have changed status since the implementation of EPC can still submit BEARs
• How USAC notifies applicants that their Form 498s have been successfully reviewed and approved

USAC notes that the most common problems encountered during its review of Form 498s are:

• The bank routing number and the bank account number are transposed
• The applicant modified the Form 498 and did not re-certify it
• USAC has not yet received supporting documentation (typically a voided bank check)
• The information provided is not consistent with the information associated with the applicant’s FCC RN