fall fy2016 e-rate workshop lorrie germann, state e-rate coordinator

Fall FY2016 E-Rate WorkshopLorrie Germann, State E-Rate Coordinator

• General E-Rate Information

• Eligible Services

– Category 1

– Category 2 / Budgets

• How To Use the New EPC Portal

– Break

• Fiber Options

• Direct BEAR Payment Process

• Program Compliance

– Lunch

• Walk through the New FCC Form 470

• **Thanks to USAC & SLD staff for providing training materials and program information.

Training Agenda

What a Difference a Year Makes

New and welcomed changes are coming!!!

Program BasicsE-Rate Program

• Federal Communications Commission (FCC), an independent U.S. government agency, established and oversees the E-Rate Program.

• Universal Service Administrative Company (USAC), a not-for-profit, administers the E-Rate Program along with three other programs.

• Schools and Libraries Program (SL) is the part of USAC with responsibility for E-Rate.

E-Rate Background

General E-Rate Information

• Commitments for E-Rate are made by funding year (FY), which runs from July 1 through the following June 30.

• USAC refers to the funding year as the year in which most services will begin, e.g., FY2016 is July 1, 2016 to June 30, 2017.

E-Rate Timeline


• Category One

–Focus on broadband access to the building

–We’ll discuss eligibility of services in more detail

• Category Two

–Focus on connectivity within the building

–Subject to Category Two budget

Category of Services

• How large are the discounts on eligible products and services?– Discounts are 20-90% of eligible costs for Category 1

services and 20-85% for Category 2– Discount level for a school/district or library depends on:

• Percentage of students who are eligible for National School Lunch Program (NSLP) in – (for a school/district) the school – (for a library) the school district in which the library

is located.• Urban or rural location of the school or library.

E-Rate Discounts


Discount Matrix

Note lower top discount rate for Category Two services.

Application Flow Chart

• Billed Entity Applicant Reimbursement (BEAR) FCC Form 472 is filed by the applicant after paying for services in full

• Service Provider Invoice (SPI) FCC Form 474 is filed by the service provider after the applicant has been billed for the non-discount portion of the cost of eligible services

*Note* Applicants can choose their method of invoicing; but be sure to ask service providers if they will provide discounted bills.

2 Methods of Receiving Funding

Receiving Funding

E-Rate Letters


All acknowledgements will now be in the EPC portal…so

• Say goodbye to the color-coded letters beginning FY2016……

– 2013

– 2014

– 2015

BlueCanary

Pink

• FCC Form 470 - Posted at least 28 days before the filing of the FCC Form 471, keeping in mind the FCC Form 471 application filing window opening and closing dates.

• FCC Form 471 - Received or postmarked no later than 11:59 PM ET on the day of the close of the FCC Form 471 application filing window (exact window dates will be posted on our website).

• FCC Form 486 - Received or postmarked no later than 120 days after the date of the FCDL or the service start date, whichever is later.

• FCC Form 472/ FCC Form 474 - Received or postmarked no later than 120 days after the date of the FCC Form 486 Notification Letter or the last date that the applicant can receive service from the provider in the funding year at issue, whichever is later.

• Appeals - Received or postmarked no later than 60 days after the date of USAC's decision letter.

Application DeadlinesDeadlines

• Discounts are calculated for the organization as a whole.

• Discount rates do not change based on which entities within a district/system are receiving service.

• Libraries derive their discount from the NSLP eligibility of the district in which the main outlet is located.

• Consortia continue to use simple average of member discounts.

• Rural status is determined at the district/system level and only if more than 50% of schools or libraries are rural.

Discount Calculations

Discount Principles

• All schools in the school district get the same discount:

– Simplifies process by not having to calculate multiple discount rates for different groups of schools.

– When eligible, Non-Instructional Facilities (NIFs) get the same discount as the schools in district.

– Single schools within a district never get their own discount rate, even if they are the only school receiving that service.

– Urban/Rural status based on all of the schools in the district (not including NIFs).


School Districts


Data from MR-81 for an Urban District:

Previous Discount % Per Building

- 80%- 50%- 60%

Previous Weighted Discount received by District - 65%

District discount will be 60%

• Libraries get their discount based on the percentage of student eligible for the NSLP in the school district in which the main outlet is located.

–No longer calculate discount based on all districts in which library system has outlets.

• Libraries calculate their own urban/rural status based on their own outlets. Therefore, the library system’s discount may not match the school district’s discount rate. –Bookmobile and kiosks count as library outlets.


Libraries and Library Systems

• Consortia calculate their discount based on the simple average of their consortia members. However, all consortia members now are listed at their district-wide discount rate, even if only some schools in the district participate in the consortium.

–Only consortia entities can get a discount that doesn’t come straight from the discount matrix.

• All FRNs, regardless of the entities served, get the same consortia-wide discount rate.


Consortia

• Nationwide program to reduce NSLP paperwork burden.

• Schools must have at least 40% of their students directly certified to qualify for CEP.

• All students eat free, but this does not mean they are counted as eligible for E-Rate purposes. Must still determine eligibility percentage.

• Schools apply national multiplier (1.6) to directly certified population to determine NSLP eligible population.

• Schools are capped at 100% NSLP eligible for purposes of determining the E-Rate discount.

Alternative Discount Mechanisms

Community Eligibility Program (CEP)

Example

• Surveys continue to be valid, though you can no longer extrapolate them.

• If you send out a survey to each student, and you only get responses from half, and only half of those are eligible, then you can only report 25% of your students as eligible for NSLP.

• Starting in FY 2015, you can use NSLP applications as your survey instrument, because you can no longer extrapolate the results.

Alternative Discount Mechanisms

Surveys

• Districts report TOTAL student counts

–Document student counts used to arrive at your total numbers for PIA and audit purposes.

• Remember how you determined numbers for each school (School A = CEP, School B = most current Site Claim Form).

• Student counts will be displayed in the new EPC Portal based on counts used in the FY2015 Form 471.

Discount Calculation Documentation

Supporting Your Discount Rate

• Know the rules

• Start early

–More changes and more to do

• Setup EPC Portal Account• Determine Category 2 needs and budgets• New Fiber options• Direct BEAR payment setup

• Subscribe to the Ohio E-Rate Distribution List

• Ask questions

Tips for Success

Eligible ServicesE-Rate Program

• Category One

• Category Two

• Category Two Budgets

• ESL updates:

Fiber ISDN Data plans

Eligible Services

Overview

Firewalls Virtualization and cloud based

functionality

• Category One primarily supports broadband connectivity to schools and libraries.

• Category One also supports voice service which is subject to a phase down of support as of FY2015.

• This includes broadband connections to eligible locations that:

– Connect multiple points

– Connect eligible locations to the Internet

– Services that provide basic conduit access to the Internet

Category One

What is Category One?

– Fiber (Lit and Dark)

– Self-Provisioned Fiber

– Wireless Service (e.g. microwave)

– Satellite Services

– DS-1, DS-2, DS-3

Category One

Eligible Data Transmission Services and Internet Access

– Ethernet– T-1, T-3, Fractional T-1– Cable Modem– DSL– ISDN– MPLS

• Some examples include:

• Starting with FY2015, voice services are subject to a 20% reduction continuing until FY2019 when all voice services are phased out.

• For FY2016, the reduction to voice services is 40%.

Category One

Voice Service

Discount % FY2015-20%

FY2016-40%

FY2017-60%

FY2018-80%

FY2019-100%

90 70 50 30 10 0

80 60 40 20 0 0

70 50 30 10 0 0

60 40 20 0 0 0

50 30 10 0 0 0

40 20 0 0 0 0

30 10 0 0 0 0

25 5 0 0 0 0

20 0 0 0 0 0

• Local, long distance, 800 service

• POTS

• Interconnected VoIP

• Circuit capacity dedicated to providing voice service*

• Centrex

• ISDN

Category One

Eligible Voice Services Subject to Phasedown

• Radio Loop

• Satellite telephone service

• Shared telephone service

• Wireless telephone service including cellular voice

– Excludes data and text messaging

• Circuits are subject to the voice phasedown if any portion of the circuit is dedicated to voice.– Circuits wholly dedicated to voice such as PRIs and SIP trunks are fully

subject to the phase down.

– A T-1 used for voice is subject to the phasedown if any of the channels are dedicated to voice.

• If there is a voice application running over a data circuit with no portion of the circuit dedicated to voice (e.g. QoS), the circuit is not subject to the phase down.

• VoIP service bundled with Internet access requires cost allocation to separate the voice from the Internet charges.

Category One

Circuits and the Voice Phasedown

• Category Two includes equipment and services needed to bring broadband into and throughout schools and libraries.

• Subject to five-year budgets for schools and libraries.

• Category Two includes internal connections, basic maintenance of internal connections and managed internal broadband service.

Category Two

What is Category Two?

• Access points

• Cabling

• Caching

• Firewalls

• Switches

• Routers

• Racks

Category Two

Eligible Internal Connections

• UPS

• Wireless LAN Controllers

• Improvements, upgrades and software necessary to support eligible broadband internal connections components

• As part of the E-rate Modernization Order, broadband distribution services and equipment that can be virtualized in the cloud are eligible.

• This includes virtual or cloud based functionalities so long as they support eligible internal connection functions.

– For example, software virtualizing routing or switching in the cloud is eligible.

• Equipment and functionalities must still be competitively bid and the most cost-effective solution must be chosen.

Category Two

Eligible Internal Connections: Virtualized and Cloud-Based Functionalities

• Services provided by a third party:

– Operation

– Management

– And/or monitoring of eligible broadband internal connection components

• The third party may manage the school or library’s equipment or provide the equipment as part of a lease.

Category Two

Managed Internal Broadband Services (e.g. Managed Wi-Fi)

• Support for basic maintenance of eligible internal connections such as:– Repair and upkeep of hardware– Wire and cable maintenance– Basic tech support– Configuration changes

• Support for BMIC is limited to actual work performed under the contract.

Category Two

Basic Maintenance of Internal Connections

• Basic maintenance does not include:– Services that maintain ineligible equipment– Upfront estimates that cover the full cost of every piece of

eligible equipment– Services that enhance the utility of equipment– Network management services, including 24-hr network

monitoring– On-site technical support– Unbundled warranties

Operations and management of eligible equipment not supported as BMIC but eligible as Managed Internal Broadband Services

Category Two

Basic Maintenance of Internal Connections

• Eligible Charges

– Taxes, surcharges and other similar reasonable charges

– Lease fees to rent or lease eligible components

– Shipping charges

– Training

– Installation and configuration

• Installation may be provided by a third party

Miscellaneous

Miscellaneous Charges

Eligible Services

ESL updates

• The Second E-rate Modernization Order equalized lit and dark fiber.

• Dark fiber special construction is now eligible both within and beyond the property line.

• Modulating electronics to light dark fiber is eligible.

• Due to the equalization of fiber, eligible costs for lit vs dark fiber has been removed.

ESL Updates

Eligible Category One Costs – Dark and Lit Fiber

• Special construction consists of

– Design and engineering

– Project management

– Construction of network facilities.

• Special construction is limited to the one-time costs of physically deploying new or upgraded network facilities and services required to complete that deployment.

– Does not include non-construction one-time costs such as Network Equipment or upfront IRU payments for dark fiber.

ESL Updates

Eligible Category One Costs – Special Construction

• Eligible costs for new or existing lit fiber, dark fiber and self-provisioned broadband networks include:

– Monthly charges

– Special construction

– Installation and activation

– Network equipment (Includes modulating electronics and other equipment to make the broadband service functional)

– Maintenance and operation charges.

ESL Updates

Eligible Category One Costs – Dark and Lit Fiber

• Integrated Services Digital Network (ISDN) is added to the list of eligible Voice Services.

– ISDN must be selected in the Voice Services category if it is being used for voice.

• Data plans and air cards for mobile devices include additional explanations of eligibility.

ESL Updates

Other Category One Modifications

• Data plans and air cards for mobile devices are eligible only:

– If you can demonstrate that individual data plans are the most cost-effective option for providing internal broadband access for mobile devices or

– Installing a Wireless Local Area Network (WLAN) is not physically possible.

• Seeking support for data plans or air cards for mobile devices for use in a school or library with an existing broadband connection and WLAN implicates the E-rate Program’s prohibition on requests for duplicative services.

ESL Updates

Eligibility Limitations of Data Plans

• This can be accomplished by seeking and comparing bids for both WLANs and individual data plans.

• The comparison may not include likelihood of receiving Category Two support.

• Program rules require applicants to use the pre-discount cost of the service and not the post-discount cost when evaluating price as the primary factor.

ESL Updates

Cost Comparisons for Data Plans

• Firewall protection provided by a vendor other than the Internet access provider OR priced separately is considered Internal Connections.

ESL Updates

Eligible Category Two Services - Firewall

• Bug fixes, security patches and online and telephone-based technical assistance still do not have to demonstrate work being performed to receive BMIC support.

• Network monitoring and management functions remain eligible only as Managed Internal Broadband Services.

ESL Updates

Other Category Two Minor Clarifications

Eligible Services

Category Two Budgets

• Each school or library receiving Category Two support between FY2015 and 2019 will have a five-year budget for Category Two products and services (those that distribute broadband within schools and libraries).

– Category Two products and services include Internal Connections, Managed Internal Broadband Services, and Basic Maintenance of Internal Connections.

– Products and services ordered in excess of an entity’s Category Two budget will not receive E-rate discounts.

– There is no budget for Category One services (those that connect broadband to schools and libraries).


What are Category Two budgets?

• Each individual school and each library outlet or branch has a pre-discount budget. School districts or library systems may not average their costs across multiple school or library budgets.

• Non-instructional facilities (NIFs) – including school NIFs with classrooms and administrative buildings – do not have pre-discount budgets.

– If a NIF is essential for the effective transport of information to or within a school or library, the applicant must allocate the NIF costs to the entities benefiting from the service while the costs for ineligible services to a NIF should be allocated out.


Which entities have Category Two budgets?

• The pre-discount budget for a school is calculated by multiplying the total number of students at the school by $150, with a minimum of $9,200 if the school has fewer than 62 students.

• The pre-discount budget for a library is calculated by multiplying the total area in square feet – including all areas enclosed by the outer walls of the library and occupied by the library – by $2.30, with a minimum of $9,200 if the library is less than 4,000 square feet.

– Libraries located in cities and urbanized areas with a population of 250,000 or more are eligible for a budget of $5 per square foot.


How much is my budget?

• Remember that the budget is PRE-DISCOUNT.

• For example, for a school with 1,000 students:

– At the 85% discount rate (the maximum discount rate for Category Two), the school will have a pre-discount budget of $150,000, but may receive E-rate discounts of up to $127,500.

– At the 50% discount rate, the school will have a pre-discount budget of $150,000, but may receive E-rate discounts of up to $75,000.


How much is my budget (cont’d)?

• The pre-discount budget calculation is for a five-year period, starting with the first funding year in which you receive Category Two support.

– However, you can apportion your pre-discount budget in a manner that best meets your needs. You could spend all of it in FY2016, spend 1/5 each year, or any other combination up to your total.


What period of time does my budget cover?

• Your pre-discount budget in FY2016 is decreased based on all commitments where your entity is listed as a recipient starting with FY2015 commitments.

– It could go up in FY2016 if your student count or square footage increases, or down if your student count decreases.


Can my budget change from year to year?

• For existing schools: If your student count decreases in subsequent funding years, you do not need to repay the fund for money disbursed in excess of the five-year budget in years when your student count was higher.

• For new schools: If you overestimate your student count and exceed the five year pre-discount budget based on your actual student count, you must return any funds in excess of the allowable budget to USAC.


Can my budget change from year to year (cont’d.)?

• On the FCC Form 471, you indicate how funding should be allocated among entities sharing services.

• Your allocation can be:

– Straight-line (all entities share the cost equally)

– Proportional (based on student count/square footage of each entity)

– Specific (you specify each entity’s share)


How do I allocate costs for shared services?

• Any funding commitments that included your entity as a recipient of service in FY2015 count against your pre-discount budget for that entity.

• If funding is remaining on a funding request, you can file an FCC Form 500 to return the funding to USAC.

– If entities are sharing the service, we will need specific information so that we know how to apply the returned funds to specific entities.

• If you need to return funds you will need to fill out a Payment Identification Worksheet.


How are services counted against my budget?

http://www.usac.org/_res/documents/cont/pdf/payments/USAC_SPIN_II_PID.pdf

How to Use the PortalE-Rate Program

• Move to one location for all program activities.– Complete and certify program forms

– Obtain the status of applications

– Submit requests

– Receive timely reminders and notifications

– Respond to PIA questions

– Ask USAC questions

• Improve the customer experience.

• Streamline the application process.

Using the Portal

Why Move to a Portal?

• All of your forms, submitted documentation, and requests will be in one location online and easily accessible.

• Users can access the portal from any device (e.g., desktop computer, laptop computer, tablet, smartphone) and any browser.

Using the Portal

Advantages of the Portal

• School districts and library systems can update and store address information and other data on their individual schools and libraries. This information can then be uploaded into online forms so that you do not have to re-enter it every year.

• Consortia and statewide applicants will have a complete list of their members, and service providers and consultants will have a complete list of their clients.

Using the Portal


• Applicants will no longer need a Personal Identification Number (PIN) to certify forms.

• Account administrators can create as many account users as they wish, and decide which activities the users can perform (i.e., set their permissions or user rights).

Using the Portal


• USAC creates an account for the applicant organization and identifies an account administrator.

• Applicant organization types:

– Independent school

– Independent library

– School district

– Library system

– Consortium / statewide applicant

Logging In

How to Log In

User Functions

Within EPC, account administrators can :• Create a New User• Remove Existing Users• Manage User Permissions• Manage Organization• Modify Account Administrator• Manage General Contact• Manage Annexes• Manage Organization Relationships

Full/Partial Right users, including consultants, can update their:• Organization's profile, and address• Entity attributes• The student counts for schools and school districts

• USAC sends an invitation email to the account administrator to log in to the portal.

– This will be the district personnel that certified the FY2015 Form 471.

– If a consultant certified the 471, the district must contact USAC to create the admin account.

• The account administrator goes to portal.usac.org, enters his or her email address – the “Username” – and clicks “Forgot Password.” NOTE: As long as the account administrator has been set up in USAC’s system, it is not necessary to locate the invitation email.

• The account administrator then re-enters the email address and clicks “Request Password Reset.”

Logging InHow to Log In

• USAC sends a second email with a link to create a password. This link is only valid for 15 minutes.

• The account administrator clicks the link, enters the email address, and creates a “new” password.

• After clicking “Reset Password,” the account administrator can click the link provided to log in.

• After logging in with the email address (“Username”) and password, the account administrator clicks the link to accept the terms and conditions of use.

Logging In

How to Log In

To access the EPC Portal, go to www.usac.org/sl and click on “E-Rate Productivity Center (EPC)” logo. You will then see the “Login” button.

http://www.usac.org/sl

Click on “I Agree” to accept the terms. Enter your email address as username.

If first time using EPC, click on “Forgot Password”.

Enter Username and click on “Request Password Reset”.

You will receive an email with a link to reset password, but it’s only valid of 15 minutes.

Landing Page View

Click on header to sort list alphabetically .

Click on name of organization to see Organization Detail page.Note: Billed Entity will appear at the top of the list.

Menu options such as “Apply Now” are also included on the Landing Page.

Click on “USAC” logo at any time to return to Landing Page.

User Profile

By clicking on the pull-down next to your user name, you can view your profile and change your settings. You can also edit your password , and the news you receive under the News Feed.

District Organization Detail Page

After clicking on your organization, you’re taken to the Details Page under “Records”, where you can create, add, or remove users, or click on the ellipsis for additional items.

As you move around in the system, the breadcrumb and main menu bar will show you where you are, as well as the side menu.

By clicking on the “Related Actions” menu, you have the option to manage users and your organization, or create an application.

“Related Actions” Menu

Please note, while under your organization's “Records” menu, if you click on “Records” from the main menu bar, you will be taken from your organization’s records to the “Records” listing at the national level. Just remember, you can return to your landing page at any time by clicking on the USAC logo.

National Level “Records” Menu

Here is the view when selecting a school building from the list of organizations.

By clicking on “Manage Organization”, you can edit information pertaining to this specific building, such as Student or NSLP Counts.

Note: You also have the option to provide information if there is an annex associated with this school.

School Detail Page

Modify An Organization - School Detail View

View after clicking on “Manage Organization”

From here, you can correct building addresses.

Modify An Organization - School Detail View cont.

You can edit the Student and NSLP counts, and then click on “Submit”.

Creating New Users

From the landing page, click on “Manage Users” and then select organization from the list.

Click on “Create New User”

Creating New User

Modify address if necessary. The Billed Entity’s address is listed by default.

Enter User Details

Select permissions for the new user, which are defined on the site.

You can assign rights per form, or choose “Apply All”.

When done, click on “Continue”

Confirm New User

Confirm information and click on “Submit” and then “Yes” in the pop-up to proceed.

The new user will receive several emails prompting them to sign in to EPC, create a password, and accept the terms and conditions. Note: The user must accept the terms and conditions before you can modify their role.

First Email Received by New User

Click on portal link, select “Forgot Password” and follow directions. The new user will receive an email with a link to create new password, and an email called “New Task: Complete Terms and Conditions.

Accepting Terms and Conditions

New user will receive the “New Task” email. Click on the link, and then initial “Accept”. Enter User Name and Password to see “Terms and Conditions”.

Scroll to the bottom of the page, and click on “Accept”

Displaying Users and Rights

Go to “Manage Users” and “Add and Remove Existing Users” to view user details.

Note: To remove a consultant, click on the “X” next to the user name. All other users can be deactivated, with the option to later reactive.

Removing (Deactivating) Other Users in Your Organization

• Select “Records” located on the main menu bar.

• Click on “Users”

Enter user’s name. After locating in list, click on user name link.


The user profile opens. Click on “Related Actions” and then “Deactivate User”.


Enter notes (a required field), click on “Submit”, and then “Yes” in the pop-up to proceed.

Note: User can be reactivated by following previous “Records” menu steps . After clicking on “Related Actions”, you will see a link to the right to “Reactive User”.

Click on “Manage Users” and then select organization from the list.

Click on “Manage User Permissions”

Managing User Permissions

We see an explanation of the permissions available.

Use the drop-down menu to assign the correct permissions, and click on “Submit”.

Managing User Permissions

Modify Account Administrator

From your landing page, choose your Billed Entity organization, and then “Related Actions”.


Click on “Modify Account Administrator”


EPC allows only one user to be designated as the account administrator. To change the current administrator, uncheck the box to the left of the current user’s name, and select the new administrator. Click on “Continue”, confirm information, and then select “Submit”.

Adding a Consulting Firm

From the landing page, select your organization, and then “Related Actions”. Click on “Manage Organizations”.

Adding a Consulting Firm

Select “Add a Consulting Firm”. Enter search information, such as name or CRN, and click on “Search”. Choose firm, and click on “Submit”.

Note: Once the firm has been added, you can go to “Add or Remove Existing Users” to add the individual consultant.

Glossary &FAQs

User Guides

Video Tutorials

Terms & Conditions

Additional Portal Resources

Fiber Options

E-Rate Program

• Emphasis on providing additional flexibility for schools and libraries seeking high-speed broadband connections.

• Lack of access to broadband, especially in rural areas, and high cost of those services are major obstacles in meeting program goals.

• Order designed to help close the rural connectivity gap and increase affordability of high-speed broadband connections.

• Everything discussed today will be in effect from FY 2016 forward.

Overview

Expanding Access to Broadband

• New Options for E-rate funded special construction for new fiber.

– Cost of deploying new fiber (as opposed to ongoing cost of leasing or maintaining/operating fiber.)

– Provides up-front capital that will reduce monthly recurring cost to applicants.

– Previously available for lit services.– Now also available for dark fiber and self-provisioned

fiber.

What’s New?


• Regardless of the services sought (including new fiber options), E-rate rules continue to require that applicants:

– Conduct fair and open competitive bidding process.

– Selecting the most cost-effective bid.

What Stays the Same?


Old Requirement

• Applicants had to amortize large, up-front construction costs in excess of $500,000 over three years.

Amortization of Up Front Special Construction Costs


New Requirement

• E-rate will now pay the full discounted share of up-front special construction charges in the first year.

Previous Requirement:

• Applicants had to pay their share of non-recurring cost of special construction within 90 days of the start of service.

Installment Payments for Special Construction Costs


E-rate will now allow:

• Applicants are allowed to pay their share of those up-front costs in installment payments over up to four years.

• Applicants interested in an installment payment plan option must indicate their interest on FCC form 470

• Service providers are under no obligation to offer such installment payment options to applicants.

Installment Payment Plan of Up Front Special Construction Costs


• Applicants can receive funding for Category One special construction costs incurred up to six months prior to start of funding year.

– Occurs after selection of service provider via FCC Form 470

– Actual service start date is on or after July 1 the funding year.

– Can get one year extension due to unavoidable delays.

Special Construction Projects


• Beginning FY 2016, funding for lit and dark fiber has been equalized.

• Dark fiber leases allow the purchase of capacity separate from the service of lighting the fiber.

Equalizing Dark and Lit Fiber


Old Dark Fiber Rule

• E-rate would only pay special construction costs up to the applicant’s property line.

• Modulating electronics not eligible in Category One.

Equalizing Dark and Lit Fiber


New Dark Fiber Rule

• E-rate will now pay special construction costs beyond the applicant’s property line.

• Modulating electronics to light dark fiber will be eligible for category one support.

• Applicants that seek bids for dark fiber must also seek bids for lit fiber service.

• Before selecting a dark fiber solution, applicants must fairly compare dark fiber with other available options to ensure the most cost effective option is chosen.

Requirement to Compare Dark and Lit Fiber


• To the extent an applicant intends to seek support for equipment and maintenance costs associated with lighting newly leased or purchased dark fiber, the request for support for those services must be included in the same application with the dark fiber lease.

• Applicants will not receive support for excess capacity and may only receive special construction support for dark fiber lit in the same funding year.

Requirement to Compare Dark and Lit Fiber (continued)


• Applicants may seek E-rate support for self-construction of their own high-speed broadband networks, or portions of such networks, when self-construction is the most cost-effective solution.

– Applications for self-provisioned networks should reflect the total cost of ownership, including special construction, equipment, and maintenance and operation.

Self-Construction of High-Speed Broadband Networks


• Requirements:

– Applicants soliciting bids for a self-provisioned network must also seek bids for lit service on the same FCC Form 470, unless the applicant already posted for broadband services for this same funding year and received no bids.

– Applicants must compare the cost of lit fiber service to the total cost of ownership over the life of the facility for self-provision option.

– Applicants seeking dark fiber or self-provisioning must upload an RFP in new the FCC Form 470 system.

Self-Provisioned Fiber Networks


• Be as specific as possible to enable a meaningful comparison of lit, dark, and self-provisioned options.

• Include estimated bandwidth sought. Terms such as “as needed” or “district-wide” are not sufficient descriptions of the quantity or capacity of the products and services requested. Applicants may identify a range, such as 100-200 Mpbs.

• Include expected growth rate in bandwidth demand over the relevant time period and seek pricing for the increased level of bandwidth over time.

Guidance on RFPs


• Include any state or local procurement requirements.

• RFPs must be available for at least 28 days.

• Fiber RFPs take time to write.

• Potential bidders need more time to respond to these bids.

• Start early!

Guidance on RFPs


Old Rule• Applicants must conduct fair and

open competitive bidding process.

• Applicants had to select the most cost-effective service provider.

• Price of eligible products and services must be the most heavily weighted bid eval factor

Competitive Bidding Considerations


New Rule• Applicants must conduct fair and

open competitive bidding process.

• Applicants had to select the most cost-effective service provider.

• Price of eligible products and services must be the most heavily weighted bid eval factor

• Comparing different fiber options:

– Determine a reasonable, defensible period of time for the comparison, based on their anticipated use of the assets. Applicants that choose to self-provision or purchase the equipment required to operate a dark fiber IRU may expect to recover their costs in 5, 7, 10, or even 20 years.

– Identify a comprehensive and specific total cost for each option.



• Comparing different fiber options:

– Applicants must be prepared to explain their assumptions, such as expected useful life.

– Divide total cost of IRU or self-provisioned fiber by number of years to determine annual cost.

– Compare to annual lit fiber charge.

• Applicants cannot resell service.

• Applicants must secure access to necessary resources.



• For shared or multi-purpose fiber build projects, costs necessary to get the fiber to the school or library are eligible.

– E-rate will not fund capacity beyond what the applicant needs in that funding year. Applicants may not seek E-rate funding for fiber that the applicant is not using.

– Example: Applicant needs 12 strands of fiber. Construction is for 96 strands. If no plans for other customers, only remove cost for 84 additional strands, but all other special construction costs would be fully eligible.

Cost Allocation


• Providing an incentive for state support of last-mile broadband facilities.

– E-rate match of up to 10% of the cost of construction will be provided to match state funding for special construction charges for high-speed broadband connections.

– E-rate match also provided for Tribal schools and libraries when matched by state, Tribal government, or federal agency.

Additional Matching Funds for Fiber Builds


Direct BEAR Payment ProcessE-Rate Program

• Applicant fills in Block 1, Block 2 – request information

• Applicant fills in Block 3 – certifications

• Applicant obtains service provider certification on Block 4

• Applicant submits BEAR

– Paper mailed to Kansas

– Online – automatic after service provider certification

FCC Form 472 - Currently

Current Process

• USAC processes invoice

• USAC approves funds

• USAC sends BEAR Notification Letters 2 weeks prior to funds being paid

• USAC electronically sends funds to service provider

• Service provider passes funds to applicants

– Must send funds within 20 business days

FCC Form 472 - Currently

Current Process

• Online Only - via EPC Portal

• Paper BEAR will be discontinued July 1, 2016

• Certifications to change

• No longer require service provider certification

• May require some information during invoice review

• Applicants paid directly via electronic transfer

FCC Form 472 – Changes – beginning July 1, 2016

Future Process

• Applicant logs into EPC portal to access invoice

• Applicant fills in information: SPIN

• Applicant fills in request: FCC Form 471 number, FRN, Dates, Amounts

• Applicant reviews and certifies information

• Applicant submits BEAR – only online

– No service provider Certification Required

FCC Form 472 – Changes – beginning July 1, 2016

Future Process

• Payments scheduled twice a week when invoice approved – no longer two week delay for service provider notification

• BEAR payments only via electronic transfer to applicant

• Billed Entities will be paid directly to bank account

• Bank account information will be required

Direct Payment – beginning July 1, 2016

Future Process

Future Process

Applicant fills out BEAR, sends to provider

Provider signs BEAR-returns to applicant

Applicant sends BEAR to USAC

USAC approves funds

USAC notifies providers

USAC sends funds to provider

Provider forwards funds to applicant

Current Process Direct Applicant Payment Process – beginning July 1, 2016

Applicant fills out BEAR online

USAC approves funds

USAC sends funds to applicant’s bank account

• Banking Information collection available from applicants after new FCC Form 498 released

• Direct Payments begin July 1, 2016

Direct Payment

Timeline

• Contact information section

• Applicant identification section

• Banking information section

Direct Payment – What You Need on FCC Form 498

FCC Form 498 Information

• Identifies contacts for financial information

• Company Officer– An officer is a person who occupies a position authorized by

the school, district or country, and consortium applicants, and would typically be a Superintendent, Assistant Superintendent, Principal or Assistant Principal, County or District Administrator, or state education department leads

– Authorized to certify that the data set forth in the FCC Form 498 is true, accurate, and complete

Direct Payment – What You Need:Contact Information section


• Identifies contacts for financial information

• General Contact– This individual will be able to retrieve the FCC Form 498

information on file with USAC as well as be given access to USAC’s on-line filing system

– This person will also be able to input new FCC Form 498 ID data for Company Officer certification

Direct Payment – What You Need:Contact Information section


• Company Officer

• Cannot be a Consultant

• Bank Account

• Cannot be owned by a Consultant

Direct Payment – What You Need: Contact Information section


• Federal Employer Identification Number (EIN/TaxID)

• Dun and Bradstreet “Data Universal Numbering System” number (DUNS or D-U-N-S)– DUNS, is a proprietary system developed and regulated by Dun &

Bradstreet (D&B) that assigns a unique numeric identifier, referred to as a "DUNS number" to a single business entity

Direct Payment – What You Need: Applicant Identification Section


• Dun and Bradstreet Number (DUNS)

• DUNS Number assignment is FREE for all businesses required to register with the US Federal government for contracts or grants

• Before applying, check to see if your organization already has a DUNS number



• Dun and Bradstreet Number (DUNS)– You can search for your organization, by name, through D&B’s online

D-U-N-S database: https://iupdate.dnb.com/iUpdate/companylookup.html or call (866) 705-5711 to speak to a representative

– If your organization does not have one, you can apply online through Dun & Bradstreet’s website: http://www.dnb.com/get-a-duns-number.html (This is neither an FCC nor a USAC website)



https://iupdate.dnb.com/iUpdate/companylookup.html

http://www.dnb.com/get-a-duns-number.html

• You will need all of the information listed below to obtain a DUNS number:

– Name of organization

– Organization address

– Name of the chief executive officer (CEO) or organization owner

– Legal structure of the organization (e.g., corporation, partnership, proprietorship)

– Year the organization started

– Primary type of business

– Total number of employees (full and part-time)

Direct Payment – What You Need: Obtaining a DUNS Number


• Name of Financial Institution

• Financial Institution Account Number

– Checking account number

• ACH Financial Institution Transit Number ( 9 digits)

– Routing Number

• Billed Entities

– BEN (Billed Entity Number)

– Name

• Enter as many as are reimbursed thru this bank account number

Direct Payment – What You Need: Bank Information Section


• Invoice Submission– Services not yet delivered – (Commitments are NOT simple grants)

– Services billed for eligible costs – not for total FRN

– Services not eligible

– Service provider not on FCC Form 471

– Services billed to party not on FCC Form 471

– Services not listed on application line item (Item 21)

– Services delivered outside funding year

– Services delivered to location not on FCC Form 471

Common Invoicing Mistakes


• Service Certifications

– Customer bill does not identify services

– Items on customer bill not found on Item 21

– Service provider not certified

– Service substitutions not requested

– Services delivered outside contract dates

– Name on bill does not match FCC Form 471



• Invoice Filing Deadline

– Invoices must be submitted to USAC

• (1) 120 days after the last day to receive service, or• (2) 120 days after the date of the FCC Form 486

Notification Letter, whichever is later – 54.514 (a)

Invoice Extension

Deadline Extensions

• Invoice Deadline Extension

– In advance of the deadline pursuant to paragraph (a), service providers or billed entities may request a one-time extension of the invoicing deadline from USAC

– USAC shall grant a 120 day extension of the invoice filing deadline, if it is timely requested – 54.514 (b)

• So…if your deadline is October 28th, you must request the Invoice Extension by that date!

Invoice Extension

Deadline Extensions

E-Rate Program

Program Compliance

• Must be a fair and open process.• Avoid conflicts of interest.

– Applicant consultant Service Provider– Applicant Service Provider

• Open competition and bid evaluation.• Follow all rules – FCC and state/local.• Read the FCC Form 470/RFP responses and contract fine print.• 6th Report and Order provides further clarifications and examples

of rule violations.

The Competitive Bidding Process

Fair and Open Competition

http://transition.fcc.gov/Daily_Releases/Daily_Business/2010/db1108/FCC-10-175A1.pdf




• Indicates the services and categories of service which entities are seeking.

• Must be posted for at least 28 days.• Indicates if they are planning/have issued RFP or other

documents regarding the procurement.• Indicates any special requirements and/or disqualification

factors.• Indicates who will be receiving the services.

FCC Form 470


• Determine the types of service you will seek on an FCC Form 470.

• Prepare and fill out the FCC Form 470.• Sign, certify and/or submit FCC Form 470.• Negotiate with prospective bidders.• Run the competitive bidding process.

Only Applicants Can:


• Have a relationship with service providers that would unfairly influence the outcome of the competition.

• Furnish service providers with inside competitive information.• Have ownership interest in a service provider’s company

competing for services.• Violate applicant’s own ethical regulations policy.• Fail to describe the desired products and services with sufficient

specificity to enable interested parties to bid. • Receive gifts or donations from service providers that violate

FCC rules or seek to circumvent FCC rules.

Applicants Cannot:


• Have pre-bidding discussions.– Discuss new product offerings.– Teach applicants about new technologies.– Present product demonstrations.

• Provide or receive de minimis items.– Modest refreshments, not offered as a part of a meal.– Items with little intrinsic value such as certificates and

plaques.

Applicants and Service Providers Can:


• Retain all vendor selection documentation for at least ten years from the last date to receive service.– Winning and losing bids, correspondences, memos, bid

evaluation documents, etc. • Price of the eligible goods and services must be the primary

factor or the most heavily weighted overall in any tier.– USAC sample evaluation matrix available

• Evaluation begins after 28-day waiting period.• Service providers may not pay for applicant’s termination

charges incurred in breaking a contract.

Bid Evaluation


http://www.usac.org/_res/documents/sl/pdf/samples/samples-checklist-vendor-selection-templates.pdf

• Selecting the winning bidder– Price of the ELIGIBLE goods and services must be the

primary factor in the bid evaluation.– 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 Construct An Evaluation for weighting samples.

Most Cost-Effective


http://www.usac.org/sl/applicants/step03/evaluation.aspx

Competitive Bidding

Factor Points Available Vendor 1 Vendor 2 Vendor 3Price of the ELIGIBLE

products and services 30 15 30 25Prior experience w/ vendor 20 20 0 20Prices for ineligible services,

products and fees 25 20 15 25Flexible Invoicing: 472 or 474 15 0 15 15

Local or in-state vendor 10 10 8 7Total 100 65 68 92

• The price of the eligible products and services must be the most heavily weighted factor in your evaluation of bids

Sample Matrix

• Ysleta Order, para. 54: Example: 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.

• Applicants must be able to demonstrate why a solution with higher than average pricing is cost-effective.

Cost-Effectiveness


• Applicants must have a signed contract or other legally binding agreement in place prior to submitting their FCC Forms 471 to USAC.

• Signed contracts constitute the best evidence that a legally binding agreement exists.

• A verbal offer and/or acceptance will not be considered evidence of the existence of a legally binding agreement.

• Tariffed or Month-to-Month service purchased under contract is contracted service.

• Purchase orders must be considered a contract or legally binding agreement in this state in which you reside.

• Voluntary contract extensions are allowable only when the option is stated in the original provisions of the contract.

Contracts


E-Rate Support and Information

Lorrie Germann: [email protected] [email protected]

www.ohiocsc.org

Office: 740-223-2420Cell: 740-253-1153

Contact Information

mailto:[email protected]

mailto:[email protected]

http://www.ohiocsc.org/

fall fy2016 e-rate workshop lorrie germann, state e-rate coordinator

Documents

discount rate

program basicserate

state erate coordinator

new fcc form

program information

budget category of services

bluecanarypink12fcc

eligibility of services