USAC Fall Applicant Training:
USAC announced the schedule for its annual fall applicant workshops for the following locations and dates:
- Washington, DC - Monday, September 29th (already available only on a waiting list basis)
- Philadelphia - Tuesday, October 7th
- Minneapolis - Monday, October 13th
- New Orleans - Thursday, October 16th
- Portland - Tuesday, October 28th
- Los Angeles - Thursday, October 30th (already available only on a waiting list basis)
- St. Louis - Tuesday, November 4th
- Orlando - Tuesday, November 11th
With a major FCC E-Rate 2.0 Modernization order expected this summer, this is going to be an interesting year for E-rate applicants and service providers. Training will be critical. We expect additional outreach efforts from USAC and from a number of states.
NSLP Income Guidelines for 2014-2015:
The Discount Rate Optimization section of the E-Rate Central website, including the sample income survey letters, has been updated to reflect the U.S. Department of Agriculture’s revised National School Lunch Program (“NSLP”) Income Eligibility Guidelines for the 2014-2015 year. Overall, the annual income eligibility levels are up 1.0–1.6% for the 48 contiguous states.
E-mpa Petition for Clarification on Bundled Services:
Last month the FCC released a “Cost Allocation of Bundled Services” Order (DA 14-712). The Order reversed a previous rule contained in the FCC’s 2010 Clarification Order regarding cost allocation of bundled services. As discussed in our newsletter of May 26, 2014, the new Order will again require E-rate recipients to allocate out the cost of all ineligible components that are bundled with eligible products or services.
Last week, the E-Rate Management Professionals Association (“E-mpa”) filed a petition with the FCC seeking clarification of the new unbundling rules. E-mpa’s concerns are with the procedural aspects of the Order and the impact they will have on USAC, applicants, and service providers. Specifically, E-mpa asks:
- How should affected contracts be identified?
- What is a fair price for the now ineligible equipment?
- What cost-allocation and amortization methodology will be employed?
- What audit and verification requirements will USAC be required to implement, and what timeframe do they have to put procedures in place to support the change in policy?
- What will the financial impact be to applicants?
While not quarreling with the substance of the revised unbundling ruling, E-mpa suggests that the implementation is fraught with difficulties, particularly regarding allocations required as of FY 2015 for earlier contracts. As a result, E-mpa “urges the Commission to provide a ‘safe harbor’ to applicants and service providers by clarifying that no cost-allocations will be required for any ineligible equipment bundled in with any contracts signed prior to July 1st, 2014.”
Large Coalition Support for E-Rate Modernization:
A large and diverse group of 106 education organizations, technology advocates, businesses, foundations, civil rights organizations, community broadband organizations, libraries, and school districts filed a letter with the Commission last week supporting E-rate modernization. The letter suggests a consensus framework for proposed changes including:
- Upgrading the E-rate program to establish and track broadband infrastructure goals.
- Focusing program expenditure on providing scalable, high-capacity, cost-effective broadband to classrooms and libraries.
- Incenting applicants to purchase bandwidth more efficiently including the facilitation of multi-year contracts and the encouragement of bulk purchasing.
- Simplifying the E-rate application process.
FCC Appeal Decisions Watch:
The FCC denied one competitive bidding appeal last week by West Oso ISD (DA 14-815). At issue was the district’s bid evaluation process that had assigned equal weight to both “price/charges” and “understanding of needs.” The E-rate rules require that price be the most heavily weighted factor. The district requested a waiver of that rule arguing that a different weighting, with price at 40%, would have resulted in the same vendor being selected. The FCC, as it has in other cases, rejected this “hindsight” reassignment argument. The FCC did note that it occasionally has waived the pricing rule when it was clear that the lowest-cost provider had been selected, but that such was not the case in this instance.