SLD Issues Notice to All 2004 (Year 7) Applicants
Message Posted January 18, 2004
Note: Last week the SLD issued this "reminder" notice for Year 7 (2004) via
e-mail to everyone in their database, and also on their website. I'm
resending it with no edits, additions or personal commentary for those of
you who may have missed it. -- jts
Important Notice for Funding Year 2004
The FCC and the SLD have already issued notices of changes and
clarifications that are applicable to Funding Year 2004. This e-mail serves
to highlight these for you to help you take full advantage of E-rate support
in the upcoming funding year and avoid denial of funding requests on Forms
471 for Funding Year 2004. Applicants and service providers can find
additional information on the SLD web site at www.sl.universalservice.org.
You may also contact the SLD Client Service Bureau by using the "Submit a
Question" link on the web site, by faxing toll-free at 1-888-276-8736 or by
calling toll-free at 1-888-203-8100.
TECHNOLOGY PLANS
Technology plans must be written before submission of the Form 470, and they
must be approved by an SLD-certified technology plan approver before
discounted services start and before the Form 486 is submitted.
Technology plans are not required if applicants are seeking discounts on
only basic local and long distance telephone service (wireline or wireless).
Outside of these services, a technology plan should cover all services for
which discounts are being requested.
FORM 470
The Form 470 applicant is responsible for ensuring an open and fair
competitive process and selecting the most cost-effective provider of the
desired services. Price must be the primary factor in the selection, i.e.,
price must be weighted more heavily than any other single factor. The Form
470, as well as any Requests for Proposals (RFPs) or other solicitation
method, must have been tailored specifically to that applicant's needs and
circumstances, and based directly on the applicant's technology plan.
Applicants cannot seek discounts for services in a category of service on
the Form 471 if those services in those categories were not indicated on the
Form 470.
Follow this link for more information on the competitive bidding process and
the Form 470:
http://www.sl.universalservice.org/whatsnew/2003/122003.asp#120903
ELIGIBLE AND INELIGIBLE SERVICES
Voice mail is an eligible service beginning with Funding Year 2004. Voice
mail can be funded if it is categorized as Telecommunications Services or
Internet Access, and can also be funded as a component of Internal
Connections.
Onsite activities that are integral, immediate, and proximate to the
education of students or the provision of library services to library
patrons qualify as educational purposes. Furthermore, in certain limited
circumstances, telecommunications services used offsite - such as bus
drivers on a school bus, library personnel in a mobile library van, or
school staff on field trips or at facilities associated with athletic
activities - are also eligible.
Follow this link for more information on educational purposes: http://www.sl.universalservice.org/reference/educational_purposes.asp
Follow this link for more information on how to indicate non-instructional
facilities on Form 471:
http://www.sl.universalservice.org/reference/Entity_Numbers.asp
The FCC has not determined whether Voice over IP (VoIP) is a
telecommunications service or an application provided over an unregulated
information service. Pending resolution of this issue, VoIP service is not
eligible for funding.
The FCC has not resolved whether unlit (dark) fiber is a telecommunications
service. Pending resolution of this issue, it is not eligible for funding.
. (FCC's Third Report and Order, FCC 03-323, released December 23, 2003,
para.76)
Follow this link to the FCC's Third Report and Order and Second Further
Notice of Proposed Rulemaking for more information:
http://www.sl.universalservice.org/data/pdf/fcc%2003-323.pdf
In cases where a school or library owns equipment to light fiber cable, such
equipment may be traded in to the provider of a fiber optic service and
leased back by the applicant. Such a contract modification would be deemed
a minor contract modification under section 54.500(g) of the FCC's rules,
provided that this is within the scope of the original contract and the
change has no effect or negligible effect on price, quantity, quality, or
delivery under the original contract. These changes also must be consistent
with state procurement law.
Only service providers designated by USAC as eligible telecommunications
providers can provide telecommunications services under the E-rate program.
Follow this link for more information on eligible telecommunications
providers:
http://www.sl.universalservice.org/whatsnew/2003/122003.asp#122403a
For maintenance services to be eligible as Internal Connections, they must
be "necessary" and "basic." Basic maintenance services are "necessary" if,
but for the maintenance at issue, the connection would not function and
serve its intended purpose with the degree of reliability ordinarily
provided in the marketplace to entities receiving such service without
E-rate discounts. On-site technical support is not necessary to the
operation of the internal connection network when off-site technical support
can provide basic maintenance on an as-needed basis. Services such as
24-hour network monitoring and management also do not constitute basic
maintenance. Technical support, including on-site Help Desks, is not
eligible if it provides any ineligible features or functions.
Follow this link for more information on basic maintenance services: http://www.sl.universalservice.org/whatsnew/2003/122003.asp#122403
A private branch exchange (PBX) that routes calls within a school or library
is not eligible as on-premise Priority 1 equipment.
A Priority 1 service can include a single basic terminating component at an
applicant site - such as a cable modem, a channel service unit/data service
unit (CSU/DSU), network interface device (NID) or a copper to fiber (TX to
FX) converter. More complex configurations of equipment at applicant
locations that are used in the provision of a Priority 1 service must meet
specific requirements.
Follow this link for more information on these specific requirements for
on-premise Priority 1 equipment:
http://www.sl.universalservice.org/reference/OnPremP1.asp
Follow this link for more information on eligible services: http://www.sl.universalservice.org/reference/eligible.asp
CONTRACTS
Except for services to be delivered under non-contracted tariff or
month-to-month arrangements, applicants must sign a contract with their
service providers before they sign and submit the completed Form 471. If
applicants will be purchasing services under a State Master Contract, that
State Master Contract fulfills the requirement to have a signed contract;
however, applicants must comply with the terms and conditions of the State
Master Contract. Applicants and service providers must also comply with
state contract law. Listing a service provider on the Form 471 does NOT
create a contract. Applicants must be able to demonstrate that they had a
contract in place at the time that they submitted their Form 471.
Applicants must follow all state and local procurement laws that apply to
them, and must also be able to demonstrate compliance with these laws.
Follow this link for more information on contracts: http://www.sl.universalservice.org/reference/Contracts.asp
REIMBURSEMENTS vs. DISCOUNTS
Service providers shall permit the billed entity to choose the method of
payment for the discounted services, i.e., the option of requesting
discounts on bills or of paying the bills in full and then receiving
reimbursement.
TRANSFER OF EQUIPMENT
The FCC prohibits all transfers of equipment for a period of three years
after purchase. Three years or more after purchase, such equipment may be
transferred, but not in consideration of money or anything else of value.
Also, in the limited circumstance when the location where the equipment was
originally installed is temporarily or permanently closed, the equipment may
be transferred to another E-rate-eligible entity even if that entity does
not have a comparable discount level.
SERVICE SUBSTITUTIONS
In the past, services for which a service substitution was requested could
not result in an increase in price. Service substitution requests may now
substitute an eligible service with a higher pre-discount price, although
USAC will only provide support based on the lesser of the pre-discount price
of the original service or the substitute service.
PROHIBITION ON FREE SERVICES
Applicants must pay the entire undiscounted portion of the cost of any
services they receive through E-rate. The value of all price reductions,
promotional offers, trade-in allowances, vendor discounts, and "free"
products or services must be deducted from the pre-discount cost of services
indicated in Funding Requests. Costs, trade-in allowances, and discounts
must be fairly and appropriately derived. A proportionate cost allocation
is required between eligible and ineligible components.
The provision of unrelated free services by the service provider to the
applicant constitutes a rebate of the undiscounted portion of the costs, a
violation of the FCC's rules.
Follow this link for more information about free services: http://www.sl.universalservice.org/reference/freeservices.asp
RETAINING DOCUMENTATION
Applicants must retain for five years any and all worksheets and other
records that they rely on to complete their E-rate forms. Applicants must
retain copies of bidding specifications and/or Requests For Proposals
(RFPs), all bids received (both winning and losing) and all contracts with
service providers. Applicants must also maintain documentation of the
process and any related analyses leading to the selection of the winning
bid(s). Applicants must be able to demonstrate that the bid they chose is
the most cost-effective, with price being the primary factor.
jtschell@comcast.net
(717) 730.7133 (voice)
(717) 730.9060 (fax)
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