ERate 20092010

1
E-Rate 2009-2010

• What We Do and Why We Do It

Source USAC SLD www.universalservice.org/sl
Disclaimer Changes to the original
representation of SLD training materials and new
slides are solely the responsibility of the
author.
2
Todays Agenda

• Program Compliance, Reminders, Best Practices
• TPT E-Rate Critical Components
• Lunch on your own
• Form 470 Step by Step

3
Ohio E-Rate Awards

• Year 1 (1998-1999) - 58 million
• Year 2 (1999-2000) - 46 million
• Year 3 (2000-2001) - 60 million
• Year 4 (2001-2002) - 97 million
• Year 5 (2002-2003) - 82 million
• Year 6 (2003-2004) - 76 million
• Year 7 (2004-2005) - 66 million
• Year 8 (2005-2006) - 67 million
• Year 9 (2006-2007) - 77 million
• Year 10 (2007-2008) - 85 million
• Year 11 (2008-2009) - 42 million to date
  (Waves 1-24)
• Total 756 million

2323 West Fifth Avenue, Suite 100, Columbus, OH
43204 s Tel [phone] Fax [phone]
www.etech.ohio.gov
4
Program Compliance
2323 West Fifth Avenue, Suite 100, Columbus, OH
43204 s Tel [phone] Fax [phone]
www.etech.ohio.gov
5
Overview

• Roles for all
• Technology Plans
• Forms 470 and RFPs
• Competitive Bidding
• Vendor Selection Process
• Heightened Scrutiny

6
Know Your Role

• Applicants
• Write tech plan, file Form 470 and write RFP,
  evaluate bids, select provider, document the
  process, file Form 471, select invoice method
• Service Providers
• Respond to 470/RFPs, assist with preparing Item
  21 attachments, provide technical answers on
  questions regarding specific goods and services
  requested, but NOT on competitive bidding file
  SPIs and/or approve BEARs
• Consultants
• Make sure that you have a Letter of Agency from
  your customer

7
Tech Plan Requirements

• Sufficient detail to support and validate the
  services requested
• Cover all 12 months of the funding year
• Be approved by a USAC-certified Technology Plan
  Approver (TPA) before Form 486 is filed or
  services start, whichever is sooner
• In general, cover not more than 3 years

8
Forms 470

• Indicates the services and categories of service
  which you are seeking discounts
• Must be based on tech plan
• Must be posted for 28 days
• Indicates if you are planning/have issued RFP
• Can only correct this by posting new Form 470
• Indicates any special requirements and/or
  disqualification factors
• Indicates who will be receiving the services

9
Form 470 and RFP Issues

• Ensure that you post for correct categories of
  service
• Priority 1 Telecommunication Internet Access
• Priority 2 Internal Connections Basic
  Maintenance
• PIA can switch the bucket on your services on
  your 471 if you make a mistake in classifying the
  services
• Be able to explain what you were asking for
  (avoid generic descriptions or statements that
  are overly broad)
• Post for what you want (multi-year contract, type
  of service, voluntary contract extensions)

10
Competitive Bidding

• Fair and open competitive bidding process
• Avoid conflicts of interest
• Independent consultant ?Service Provider
• Applicant ? Service Provider
• Open competition and bid evaluation
• Follow the rules FCC and state/local
• Read the contract fine print
• Retain your documentation
• Retain, retain, lessen your pain

11
Vendor involvement

• Service providers cannot
• Determine the types of service the applicant will
  seek on a Form 470
• Assist applicants with the filling out of the FCC
  Form 470 which requires an applicants
  certification
• Negotiate with prospective bidders
• Run the competitive bidding process for the
  applicant
• Be privy to information about the bid not shared
  with other potential bidders
• Note Do not complete or submit E-Rate forms
  from your service providers location (ie. ITC)
  SLD tracks IP addresses

12
Imposing Restrictions

• Applicants can set some requirements for bidders.
• For example, applicants may require service
  providers to provide services that are compatible
  with one kind of system over another (e.g. Apple
  vs. Windows).
• Qualifications/disqualification factors must be
  spelled out to all interested parties
• Retain documentation of notice and review

13
Vendor Selection

• Keep documentation of your selection process
• Create your selection matrix and follow it
• If using a multi-round selection process, price
  of the eligible goods and services must be the
  primary factor in every round.
• This includes tie breaker rounds

14
Sample Matrix for Bid Evaluation
15
Most Cost Effective

• Selecting the winning bidder
• Price of the ELIGIBLE goods and services must be
  the primary factor.
• Other factors, including other price factors, can
  be considered as well but they cannot be weighted
  equally or higher than cost of the eligible goods
  and services
• See Step 4 Construct An Evaluation for weighting
  samples

16
Cost-Effectiveness

• Solution must be cost-effective (not just the
  most cost-effective)
• Routers priced at two or three times greater than
  the prices available from commercial vendors
  would not be cost-effective, absent extenuating
  circumstances.
• Receiving only one bid does not automatically
  make it cost-effective.
• Be prepared to explain why a solution with higher
  than average pricing is cost-effective.
• Provide as specific an answer with as much
  objective information as possible.

17
Free Services

• Applicants and service providers are prohibited
  from using Schools and Libraries support to
  subsidize the procurement of ineligible or
  unrequested products and services or from
  participating in arrangements that have the
  effect of providing a discount level to
  applicants greater than that to which applicants
  are entitled.
• Cant use E-Rate to get free stuff (ineligible or
  eligible). You must back out the value of that
  stuff in your vendor selection process.

18
Free Services

• Must deduct the value of the free stuff,
  discounts, trade-in etc, from the pre-discount
  amount in order get equal comparison between
  offerings.
• Cost of eligible goods and services cannot be
  inflated to cover for free ineligible stuff.
• A proportionate cost allocation is required
  between eligible and ineligible components.

19
Free Services Example

• Discount rebate
• Cost for product 100 pre-discount
• Rebate of 20 is available
• Can only apply for 80 (10080) pre-discount
• Free products included in a bid
• Vendor A 10,000 including 1,000 of free
  products
• Vendor B 8,000 for products no free products
• Must compare
• Vendor A 9,000 (10,000 - 1,000) to Vendor B
  8,000

20
Paying Your Share

• There is still no free lunch
• You will always have to pay at least 10 or more
  depending on your discount
• Service providers cannot give you the money
  (directly or indirectly) to pay for your
  non-discounted share
• Funds cannot come from the service provider or an
  entity controlled by the service provider where
  funding is contingent upon selecting that
  provider.
• Service provider bills cant be ignored or waived.

21
Budget Review

• Purpose is for you to show the SLD you can fund
  your share
• Operating budget (or draft) has dates that cover
  the funding year (July June)
• Budget documentation should clearly identify
  applicants share (e.g. expense line item)
• Can provide letter for reasonable expectation

22
Budget Review

• More about reasonable expectation
• You dont have the money in your hands now but
  expect to have it after July 1
• SLD understands that your budget cycle may not
  coincide with their review cycle
• Will have to show the money during Form 486
  review for the entire BEN for the year
• If a shortfall, SLD will work with you to cancel
  FRNs

23
Payment Plans

• Applicants are required to pay their share at the
  same time that USAC pays the discount amount.
• Service Provider certifies that the invoices they
  submit are for services that have been billed to
  service providers customers.
• Therefore, deferred payment plans that allow the
  applicant to pay after USAC has paid will
  jeopardize a funding request.
• FCC Rules include a presumption that the
  non-discount share will be paid within 90 days.

24
Heightened Scrutiny

• May include review of
• Budget
• Necessary Resources
• Competitive Bidding and Contracts
• Technology Plan
• Cost Effectiveness
• Targeted questions based on potential violations
• Selective Review Information Request (SRIR)
  contains some of the questions SLD may ask

25
Necessary Resources

• Do you have the other necessary resources?
• Are there end user computers?
• Must have reasonable plans to fully utilize all
  internal connections for which you are requesting
  discounts (e.g. 2-year plan to get computers for
  all network drops).
• Do you have software to run on the computers?
• Staff trained on how to use the technology?
• Electrical capacity?
• Can you maintain your eligible and ineligible
  equipment?

26
Certifications

• Applicants certify that
• They have secured access to necessary resources,
• They have complied with all FCC, state and local
  competitive bidding and procurement regulations,
• Non-discount portion of the costs for eligible
  services will not be paid by the service
  provider,
• No kickbacks were paid to anyone and that false
  statements on this form can be punished by fine
  or forfeiture,
• Failure to comply with program rules could result
  in civil or criminal prosecution,
• Persons who have been convicted of criminal
  violations or held civilly liable for certain
  acts arising from their participation in the
  program are subject to suspension and debarment
  from the program.

27
Retain, retain, retain

• Retain the following documents to show your
  compliance
• Letters of Agency and any agreements with all
  consultants,
• Technology Plan (both draft and final approved
  version) and Plan Certification letter,
• RFP, including evidence of publication date and
  any solicitation you did,
• Any and all bids (winning and losing), and
• An email to yourself if received no bids or only
  one.

28
Retain, retain, retain

• Retain documents to show your compliance
• Documents describing bid evaluation criteria and
  weighting
• Any correspondence with potential bidders
• Documents related to the selection of the service
  provider(s)
• Signed and dated copies of contracts
• Keep for 5 years after last date to receive
  service for FY 2009 at least June 30, 2015
  .or, to be on the safe side, keep it forever!!!!!

29
Lack of Documentation

• Leads to difficulties answering PIA
• Delays your FCDL
• Reduces/denies funding
• Leads to further questions from auditors
• Could result in you having to return cash to USAC

30
Program Reminders

• AgainWhat We Do and Why We Do It
• Schools and Libraries Division

2323 West Fifth Avenue, Suite 100, Columbus, OH
43204 s Tel [phone] Fax [phone]
www.etech.ohio.gov
31
Overview

• General Reminders
• What can you do now
• Window Activities
• Pre-Commitment Activities
• PIA Review
• Post-Commitment Activities

32
General Reminders

• Read and follow directions provided in
• Form instructions
• Website guidance
• Notification letters and other communications
• Provide complete documentation when responding to
  USAC
• Make sure you retain your documentation
• Do not wait until the last minute

33
General Reminders

• Filing for multiple years
• 2007-2008 File BEAR Form (Received or postmarked
  no later than 120 days after the date of the Form
  486 Notification Letter or 120 days after the
  last date to receive service, whichever is later.
  ) If your service end date is 06/30/2008, and is
  the later date, the BEAR is due 10/28/2008.
• 2008-2009 File Form 486 (Received or postmarked
  no later than 120 days after the date of the USAC
  Funding Commitment Decision Letter or 120 days
  after the service start date, whichever is later.
  
• 2009-2010 Begin filing Form 470

34
Start Now

• Update Contact Information
• Are there staff changes?
• Did you hire a consultant and need to change the
  contact information?
• Do you need a new BEN, change BEN name or
  address?
• Technology Plan
• Does your technology plan cover the upcoming
  funding year?
• Are the services you are requesting addressed in
  the technology plan?

35
Start Now (October)

• Posting Form 470/RFP
• File and certify Form 470 online
• Do you have enough time to post the Form 470 and
  select the vendor?
• Are you seeking a multi-year contract?
• Did you indicate you have an RFP?
• Is the service description overly-broad?
• Did you post for all the correct categories of
  service?

36
Start Now (October)

• Review Receipt Notification Letter (RNL) for
  accuracy
• Did you post for the correct categories of
  service?
• Did you remember to cite all the recipients of
  service?
• Competitive Bidding
• Did you wait 28 days before selecting your
  service provider?
• Did you document your competitive bidding
  process?
• Was price weighted the most heavily during your
  bid evaluation?

37
Start Now (November)

• Competitive Bidding
• Did you retain a copy of ALL of the competitive
  bidding documentation (bid evaluation matrix,
  winning and losing bids)?
• Do your vendor selections need board approval,
  before you sign a contract?
• Contracts
• Did you sign and date the contract on or before
  the Form 471 certification postmark date?
• If you are using a state master contract, are you
  able to access a copy of the contract to provide
  to the PIA reviewer?

38
Start Now (November)

• SPIN information is accurate
• If you are seeking telecom services, make sure
  your service provider is eligible to provide
  telecom services
• Work with your service provider to ensure the
  service providers information is updated on Form
  498
• Work with the service provider to make sure the
  service provider filed annual SPAC (Form 473) for
  this funding year

39
Window Reminders

• Completing Form 471
• Are your discount calculations correct?
• Are your entities eligible to receive internal
  connections (Check 2-in-5 status)?
• File Priority 1 and Priority 2 FRNs on separate
  applications
• Submit your Item 21 Attachments with your Form
  471 application
• Submit and certify Forms 471 online
• DONT wait until the last week of the window to
  submit your application

40
Window Reminders

• Review Receipt Acknowledgement Letter (RAL) for
  accuracy
• Submit corrections before PIA review begins
• Make sure you have documentation to validate
  requests to increase funds or discounts
• Remember to check the Form 471 Block 4 worksheet
  online
• Other Important documents
• Consortium members submit LOAs to consortium
  leader
• If you hire a consultant, make sure you sign an
  agreement or LOA and retain a copy

41
Keep Your Dates in Order

• Remember the correct order for dates
• Allowable Contract Date (28 days after 470)
• THEN
• Contract Award Date
• THEN
• Form 471 filing
• THEN
• Form 471 Certification date
• ALL BEFORE
• Window close

42
Pre-Commitment Review(January and February)

• Things to do before PIA contacts you
• Submit your Item 21 Attachments online or paper.
• Item 21 Attachment
• A narrative overview or description of the
  products and services
• Place application number(s),FRN(s), Attachment
  ID, and page numbers on Item 21 Attachments
• Indicate Bandwidth when you are requesting
  telecom or Internet access
• Indicate the entities receiving services and
  locations
• Clearly label ineligible items and costs
• Indicate product make and model for each product
  requested
• Provide a detail product or service description
• Service providers can assist applicants to
  complete the attachment

43
Pre-Commitment Review(January and February)

• Things to do before PIA contacts you
• Gather supporting documentation
• Third party documentation will be needed to
  validate new entities eligibility and discount
• Discount calculations may be requested if you
  used an alternative discount methodology
• Make sure the applicant signed and dated the
  contract before the Form 471 certification
  postmark date
• Proof of new construction documentation (e.g.
  RFP, statement of work, Board Approval)
• If you did not submit Form 470 certification in
  window, submit it now.

44
PIA Review

• Communicate with the PIA reviewer
• Respond to PIA inquiries. Answer all questions.
• Request deadline extension if you need additional
  time to respond
• Ask questions if the PIA reviewers requests are
  unclear
• Inform PIA if you have already submitted
  information (provide other application number and
  FRN)

45
PIA Review

• Services Cost Allocations
• Work with the service provider to identify the
  ineligible services, so they are clearly
  identified
• On the Item 21 Attachment identify the
  ineligibles services and associated costs
• Prepare a revised Form 471 Block 5 to reflect
  the cost allocations
• Entity Removal
• On the original Form 471 Block 4 worksheet
  identify the entities to be removed
• Prepare a revised Form 471 Block 4 worksheet if
  new discount calculations and student counts
• On the Block 5 funding request, indicate your
  revision to the dollars requested based on the
  share of the funding request for the entities
  being removed

46
Post-Commitment (April July)

• Review the FCDL for Accuracy
• Read the FCDL comment to determine if
  modifications have occurred to the FRN to ensure
  you invoice for the correct services.
• Verify SPIN, discount, fund request, start and
  end dates, and contract number (if applicable).
• If you disagree with the decision, you may file
  an appeal.

47
Appeals

• Decisions of the SLD can be appealed to the SLD
  or to the FCC
• Can be filed electronically or on paper
• Must be received or postmarked within 60 days of
  the SLD decision
• See Appeals Procedure in the Reference area for
  specific guidance
• Requests for waivers of rules must be filed with
  the FCC

48
Post-Commitment (April July)

• Technology Plan Approval
• Make sure your technology plan is approved by a
  certified technology plan approver prior to
  submitting the Form 486 or beginning services,
  whichever is earlier.
• CIPA Compliance
• Ensure your Internet safety policy is up to date.
  
• Make sure your technology protection measures are
  in place.

49
Post-Commitment (April July)

• Submit Form 486
• Form 486 must be postmarked or received no later
  than 120 days after the Service Start Date shown
  on the Form 486 or no later than 120 days after
  the date of the FCDL, whichever is later
• Before submitting an invoice
• Generally, services must have been delivered
• Work with your service provider to determine the
  invoice method you would like to use (BEAR Form
  472 or SPI Form 474)

50
Post-Commitment (April July)

• Before submitting an invoice remove
• any ineligible products and services
• any products and services that were not approved
  on that FRN

51
Post-Commitment

• Invoicing deadlines
• Invoices must be postmarked or received by USAC
  no later than
• 120 days after the last date to receive service
  or
• 120 days after the date of the Form 486
  Notification Letter
• whichever is later

52
Post-Commitment

• If you need more time to invoice, file an invoice
  deadline extension request
• Requests for extensions must be postmarked or
  received by USAC as soon as possible after the
  last date to invoice
• USAC provides for the extension of invoice
  deadlines under certain conditions, such as
• Authorized service provider changes
• Authorized service substitutions
• USAC errors (for example, in data entry) that
  ultimately result in a late invoice
• Circumstances beyond the service providers
  control

53
Post-Commitment

• Invoicing
• Make sure your invoice is not a duplicate
• Make sure funds are still available in your FRN
• Monitor your invoices submitted
• Review your Quarterly Disbursement Reports
• You can request an Invoice Check if you want to
  closely monitor SPI (Form 474) payments

54
Best Practices
Just in Case
54
55
Examples of Rule Violations that Warrant Recovery

• Insufficient documentation of the competitive
  bidding process.
• Lack of necessary resources.
• Service substitutions that would not meet
  criteria established in the rules.
• Receipt of duplicative services.
• Failure to pay non-discounted share.
• Failure to complete service(s) within the funding
  year.
• Discount calculation violation.
• Services not provided for full funding year.
• Failure to have an approved technology plan.

55
56
What is a COMAD?

• A COMAD, or Commitment Adjustment, is where USAC
  determines that funds were committed in violation
  of program rules.
• When a COMAD is discovered, USAC must then adjust
  those funding commitments.
• If the amount of the revised commitment (original
  commitment less COMAD amount), is less than the
  disbursed amount, then USAC will seek recovery of
  the difference.

56
57
Examples of a COMAD

• Funding approved for ineligible services.
• Funding approved at a discount rate higher than
  that which can be supported.
• Funding for services requiring a tech plan, when
  no tech plan is in place.
• Funding provided when the competitive bidding
  requirements have not been met.
• USAC was invoiced in excess of the amount the
  applicant was invoiced by the service provider.

57
58
E-Rate Binder
58
59
Technology Plans

• Technology plan best practices
• The five required elements are clearly laid out
  in the technology plan.
• All technologies that are requested on Form(s)
  470 are addressed in the technology plan.
• Technology plans are approved prior to the start
  of services.
• Technology plan is approved by a SLD or FCC
  certified technology plan approver.
• Technology plan and all updated versions are
  dated.
• Keep copies of all technology plan documents
  (draft technology plan, final technology plan and
  approval letter) in E-Rate binder.

59
60
Childrens Internet Protection Act (CIPA)
CIPA best practices

• Documentation supporting a public hearing or
  notice is maintained.
• On the first day of the Funding Year, and
  periodically throughout the year, common filter
  reports (i.e. most accessed websites or most
  blocked websites) are run, printed and
  maintained.
• Documentation supporting the purchase or renewal
  of filter equipment, software or licenses is
  maintained.
• All documentation supporting compliance with CIPA
  rules is maintained in E-Rate binder.

61
Discount Calculation

• Best practices
• Reports and supporting documentation containing
  the data used to complete Block 4 of the Form(s)
  471 are maintained.
• Document the method used to calculate discount.
• All documentation is maintained in E-Rate binder.

61
62
Discounts

• Discount Matrix Its not a one-to-one
  correlation

63
Discounts

• Alternative Discount Mechanisms
• These mechanisms must use a measure of poverty
  equivalent to that used in NSLP
• Participation in certain programs (e.g., Food
  Stamps, Medicaid)
• Matching siblings
• Income surveys
• A sample survey and more information is available
  USAC website
• The survey must be sent to all families whose
  children attend the school.
• The survey must, at a minimum, contain the
  following information
• Name of family and students
• Size of the family
• Income level of the family

64
USDA Agreement

• Applicants may share individual childrens
  information as long as the following conditions
  are followed
• Request applications for a sample of eligible
  students
• Confirm an application or other documentation
  exists for each selected student and
• The applicant may redact personal student
  information from the applications or other
  documentation.

64
65
Service Delivery and Inventory
Management

• Best practices
• All funded equipment is installed, operational
  and in use.
• Applicants maintain equipment inventory with
  enough detail to locate all equipment funded by
  E-Rate.
• Information to include Funding Year, 471 number,
  FRN, Location, Serial number, Make Model, USAC
  invoice number, Install Date, Customer Bill
  Information, Replacement Date, etc.

65
66
Spare Equipment
Its a no no.
66
67
Service Delivery and Inventory
Management

• Best practices contd
• Applicants verify work performed and maintain
  documentation stating such.
• When equipment or wiring is installed, applicant
  performs walk through and documents acceptance of
  work performed.
• When maintenance is performed, applicant
  maintains documentation showing date of
  maintenance and detail of work performed.
• All documentation is maintained in E-Rate binder.

67
68
Effective Use

• Best practices
• Applicant maintains copies of network diagrams.
• Applicant documents inventory of end user
  computers in use.
• This number does not have to be exact, however,
  it should at least be a good faith estimate.
• Applicant maintains a list of the operating
  systems and software in use on end user
  computers.
• Applicant maintains copies of staff training
  agendas, materials and sign-in sheets.
• All documentation is maintained in E-Rate binder.

68
69
Invoicing, Payments and Reimbursements

• Best practices
• Detailed bills the bills should provide details
  pertaining to the equipment or services
  delivered.
• All bills are maintained, not just summary pages.
• Applicant performs a reconciliation or
  verification of all bills received.
• Shows any ineligible items or services deducted
  from amount invoiced to USAC.
• Shows applicants verification that equipment or
  services were delivered or installed.

69
70
SLD News Brief

• Emailed each week
• Subscribe from SLD website
• Covers topics of current interest
• Indicates important program deadlines
• Archives of past issues
• Subscribe to SLD News Brief go to
  http//www.universalservice.org/sl/tools/news-brie
  fs/subscribe.aspx

71

• Questions?

72
Support from eTech Ohio

• eTech Ohio E-Rate Support and Information
• e-rate_at_etech.ohio.gov
• Lorrie Germann
• Educational Technology Consultant
• 614-485-6050
• Richard Kevern
• Educational Technology Consultant
• 330-686-2061
• To subscribe to the E-Rate distribution list,
  send an email with no message to

73
(No Transcript)