At the New Year, it is worthwhile to look back on the past year and to plan for the new one. Here’s our annual E-rate review of 2022 and a preview of 2023. Additional details on 2022 developments can be found in our E-Rate Weekly News Archive. Both years were or will be characterized by continued pandemic concerns and new broadband funding programs.
Key Milestones in 2022:
January
|
- The FCC adopted a Report and Order (FCC 22-2) on the Affordable Connectivity Program (“ACP”), a $14.2 billion federal program providing discounts on internet services for low-income households.
- The FY 2022 Form 471 application window opened on January 12th.
- The FCC adopted new rules (FCC 22-8) on Tribal library E-rate eligibility.
|
February
|
- The FCC extended the ECF service delivery deadline for first and second window applicants one year to June 30, 2023 (DA 22-176).
|
March
|
- The FY 2022 Form 471 application window closed March 22nd.
|
April
|
- The third ECF application window opened April 28th and closed May 13th for services to be delivered between July 1, 2022, to December 31, 2023.
- DUNS numbers, previous used with SAM.gov registrations required for ECF invoicing, were transitioned to new Unique Entity Identifier (“UEI”) numbers.
- The first wave of E-rate funding commitments for FY 2022 was released on April 23rd.
- Public comments were received on the FCC’s proposed E-rate bidding portal (FCC 21-124 — see our newsletter of May 2nd).
|
May
|
- FCC Chairwoman Rosenworcel announced a proposal to permit E-rate funds to support Wi-Fi on school buses. No definitive action on this proposal was taken in 2022.
- The Federal Trade Commission (“FTC”) adopted a policy statement guiding the enforcement of the Children’s Online Privacy Protection Act (“COPPA”) with respect to data gathered by education technology companies.
|
June
|
- Congress extended the free meal provisions for all children, which had been in effect throughout the pandemic, through the summer of 2022, but not into the 2022-2023 school year. This will require a return to the NSLP and CEP provisions for free meals for the 2023-2024 school year.
|
July
|
- As of July 1st, the start of FY 2022, USAC had released eleven funding waves with FCDLs totaling approximately $1.94 billion, the highest ever at this point in the year.
|
August
|
- The FCC established two outreach programs (FCC 22-64 and FCC 22-65) to increase awareness and promote enrollment in the ACP internet discount program.
- The FCC released a “Report on the Future of the Universal Service Fund” (FCC 22‑67) addressing the goals of universal deployment, affordability, adoption, availability, and equitable access to broadband services.
|
September
|
- Dramatically raising the awareness of cybersecurity concerns, Los Angeles Unified School District reported a major ransomware attack and petitioned the FCC for E-rate support to bolster and maintain IT security infrastructure.
- Responding in large part to supply chain issues, the FCC extended the service delivery deadline for FY 2021 non-recurring service FRNs by one year to September 30, 2023 (DA 22-976).
- The FCC extended deadlines and waived other rules to assist E-rate and ECF applicants adversely affected by Hurricane Fiona (DA 22‑998). Similar actions were taken the following month for those applicants affected by Hurricane Ian.
|
October
|
- USAC announced plans to integrate E-rate invoicing and post-commitment changes into EPC early in 2023.
- The General Accounting Office (“GAO”) released a report indicating that additional Federal coordination is needed to enhance K-12 cybersecurity.
- Funds For Learning released the results of its twelfth annual E-rate survey (see summary in our newsletter of October 31st).
|
November
|
- The FCC adopted a new Order (FCC 22-84) dealing with National security threats. The list of barred Chinese firms now stands at ten “covered companies.”
|
December
|
- Heading into 2023, the USF contribution factor is once again over 30% (see our newsletter of December 19th).
- The FCC’s Office of Inspector General (“OIG”) and its subcontractor, Censeo Consulting Group, began requesting audit-like documentation from selected ECF applicants on unmet need surveys, asset inventories, and invoices on ECF-purchased equipment and services.
- The FCC adopted the Eligible Services List (DA 22-1313) for FY 2023 with only one minor change from FY 2022. Separately, on the plus side, the FCC issued a request for comments (DA 22-1315) on the use of E-rate funds for advanced or next-generation firewalls and other network security services. This is the first time that the FCC has addressed — and in a seemingly positive manner — the eligibility of cybersecurity products and services (see our newsletter of December 19th).
- The FCC reappointed Dr. Daniel A. Domenech, Executive Director,
American Association of School Administrators and Amber Gregory, Manager of E-Rate Services, Arkansas State Library, to new three-terms as members of the USAC Board.
|
Anticipated Developments in 2023:
E-Rate: The E-rate program continues to run smoothly. At this point, USAC is on track for opening the FY 2023 Form 471 application window on January 18th and closing it on March 28th. To avoid last minute hassles and possible system problems, we encourage applicants to complete their competitive bidding processes, sign their contracts, and file their FY 2023 applications as early in the year as possible.
The most difficult aspect of the FY 2023 application process, at least for some applicants, may be determining current NSLP percentages for discount rate purposes. With free meals having been made available to all students over the past two pandemic years, schools needing to collect NSLP applications for the current school year may have had to reeducate parents on the process. As such, schools may be hard pressed to fully update their eligible student counts before the administrative window closes on January 16th. The wait for complete NSLP data may also slow state efforts to submit FY 2023 valid files to USAC for PIA review purposes.
The hope is that 2023 will, for the first time in a long while, bring about an expansion of the Eligible Services List, at least for FY 2024. Two major additions are under consideration.
- Cybersecurity: As discussed in our newsletter of December 19th, the FCC has requested comments on the use of E-rate funds for advanced or next-generation firewalls and other network security services. Although not a formal Notice of Proposed Rulemaking, the request for comments is the first time that the FCC has addressed — and in a seemingly positive manner — the eligibility of cybersecurity products and services. With reply comments not due until March 30th, and the FY 2023 ESL already finalized, any change in cybersecurity eligibility for the coming year is unlikely. To allow for that possibility, however, applicants purchasing advanced firewalls in FY 2023 may wish to file two FRNs — one FRN covering the allocated cost of the currently eligible “basic” firewall, and a second FRN for the remaining portion.
- Wi-Fi on school buses: FCC Chairwoman Rosenworcel’s proposal to make W-Fi on school buses E-rate eligible (see our newsletter of May 16th) via a Declaratory Ruling has stalled but may be resuscitated by the addition of a fifth Commissioner. In the meantime, experience gained with school bus Wi-Fi supported under ECF may demonstrate educational benefits to students — not to mention the sanity of bus drivers (see our newsletter of May 30th).
The most controversial E-rate development in 2023 is expected to revolve around the FCC’s proposal to implement an online competitive bidding portal — see FCC Notice of Inquiry (FCC 21-124) referenced above and in our newsletter of December 20, 2021. Fortunately, the bidding portal is not expected to be implemented until FY 2024 at the earliest and will not affect FY 2023 applications.
ECF: USAC’s review of pending ECF applications is now focused on Window 3 applications with funding currently being provided down to the 75% rural level. Funding at lower priority levels remains a distinct possibility as USAC completes application reviews and applicants continue to reduce their funding commitments for unneeded equipment and services. ECF audits, now just beginning, may hasten additional commitment reductions.
Service delivery deadlines — June 30th for Windows 1 & 2 commitments and December 31st for Window 3 commitments — will shift the focus to invoicing. As this occurs, many applicants and service providers will find a need to renew their SAM.gov registrations (required annually). More importantly, as ECF funding for home internet services comes to an end, we expect to see more schools and libraries begin to promote the alternative use of ACP discounts for qualified low-income families.