News of the Week

E-Rate for FY 2025 – Application Window:

Application Window: The Form 471 application window for FY 2025 will open midday on Wednesday, January 15th, and close on Wednesday, March 26, 2025, at 11:59 p.m. EDT.  The administrative window, giving applicants an opportunity to update their EPC entity profiles, will close on Thursday, January 9th.

E-Rate for FY 2024:

Wave 36 for FY 2024 was released on Thursday, December 26th, for $3.81 million.  Total funding is now $2.50 billion.  Currently, USAC has funded 97.4% of the originally submitted applications, representing 85.4% of the dollars requested.

Upcoming Dates:

New FCC Guidance on Hot Spot Competitive Bidding:

In late 2002, the FCC issued a decision that has come to be known as the Kalamazoo Reconsideration Order (DA 02-2975) that permits applicants who are posting Form 470 requests for new services to receive discounts under longer-term contracts that had been signed prior to the new competitive bidding  process.  The Kalamazoo decision assumed that any such earlier contract would have been competitively bid and hence would meet the bidding requirements for a newly eligible service.

Last week, the FCC issued explicit guidance to USAC (DA 24-1287) clarifying that the Kalamazoo competitive bidding exemption does not apply to hot spots and related wireless internet services that are newly eligible for E-Rate discounts as of FY 2025.  The FCC explained that there could be no assurances that earlier hot spot and internet contracts — especially contracts signed under the auspices of the Emergency Connectivity Fund (“ECF”) for which the applicants paid no percentage of the cost — had been truly competitively bid.  The FCC explained:

We are concerned that applicants will have an incentive to remain with an existing provider rather than carefully considering all other bids received. We also note that because ECF applicants were not required to pay for a share of the costs or use price as the primary factor in their vendor selection process, like required in the E-Rate program, that contracts entered into during the COVID-19 pandemic may not have been the most cost-effective offering given the ongoing public health emergency and supply chain issues during the pandemic.  Requiring a new contract is therefore the best interpretation of the Commission’s direction not to grandfather existing contracts for Wi-Fi hotspots and service that were entered into during the pandemic when competitive bidding and gift rule requirements, including using price as the primary factor, were often waived because of the ongoing public health emergency.  We therefore direct USAC not to apply the Kalamazoo Reconsideration Order precedent to requests for WiFi hotspots and/or the services, and to find a competitive bidding violation if the applicant relies on a previously signed contract.