|
SUPTS. MEMO. NO. 144
September 19, 1997 |
| TO: | Division Superintendents |
| FROM: | Richard T. La Pointe Superintendent of Public Instruction |
| SUBJECT: | Universal Service Discount Update |
On June 13, 1997, in Supts. Memo number 103, the Universal
Service Discount program (E-rate) was introduced and
information was provided for superintendents. Since that
memo was issued, there have been many changes in the
regulations and administrative process.
On May 7, 1997, the Federal Communications Commission issued
a Report and Order on Universal Service Discounts for
schools, libraries and rural health care providers. The
Report and Order began the process of instituting new
federal regulations aimed at discounting telecommunications
rates to schools and libraries by 20 to 90 percent. The
regulations have been revised twice since May 7 and became
law on July 17, 1997.
According to the new regulations, schools and libraries will
be eligible for discounts of 20 to 90 percent of the lowest
competitively available rate for all commercially available
telecommunications services, Internet access, and
installation and maintenance of internal connections
providing telecommunications services from the internet to
classrooms. Discounts will apply to telephone service (local
and long distance); advanced telecommunications services
such as video-on-demand and distance learning; and a "basic
conduit" from an internet service provider (ISP) to the
classroom. Discounts can be applied to ISP charges and
inside wiring including routers, hubs, servers, wires and
installation and maintenance of those items. Computers,
software (other than software needed to manage the network)
and staff training are not eligible for discounts.
Additionally, schools and libraries will have the
flexibility to purchase whatever package of
telecommunications services they believe will meet their
needs most effectively and efficiently.
Discount percentage rates will be based on the number of
students eligible for the national school lunch program and
the location (rural or urban) of the school or library. The
FCC has provided a matrix of six levels of discounts.
Discounts can apply either to individual schools, or can be
averaged for the school division. Schools and libraries may
combine efforts in consortia in order to utilize services
more efficiently. The FCC encourages school divisions to
consolidate service requests at division levels or within
consortia.
On July 18, 1997, the FCC issued an order that three
corporations be formed to administer the Universal Service
Discount program. Those corporations are: The Universal
Service Administrative
Corp. (USAC), charged with collecting and dispersing money;
the Schools and Libraries Corp. (SLC), charged with
reviewing and approving discount applications from schools
and libraries; and the Rural Health Care Corp. (RHCC),
charged with reviewing and approving discount applications
from rural health care providers. On September 9, 1997, the
chairman of the FCC named the board of directors of the
three corporations. The boards are required to hold their
initial meeting prior to September 23.
In an order issued on August 15, the FCC ordered the
National Exchange Carrier Association (NECA) to begin the
Universal Service administrative process until the
corporations are staffed sufficiently to administer the
programs. NECA estimates they will be ready to accept
applications by mid-November. The FCC, working with the US
Department of Education, plans to issue official
applications shortly. When applications are available, the
Virginia Department of Education will mail them to school
divisions, the application will also be published on the DOE
Homepage.
To qualify for discounts, schools and libraries must provide
certain information on their applications. Although
applications are not yet available, the FCC regulations
include the following requirements that schools and
libraries must meet in order to participate:
Schools and libraries must prepare a technology plan for using
the discounted telecommunications services. The plan must be approved
by the Virginia Department of Education.
In addition to the approved technology plan, schools and
libraries must provide the following information to the
administrator (NECA) as specified in the Code of Federal
Regulations Part 54.504 of Title 47:
(a) Competitive Bidding Requirement. All eligible
schools, libraries, and consortia including those
entities shall participate in a competitive
bidding process, pursuant to the requirements
established in this subpart, but this requirement
shall not preempt state or local competitive
bidding requirements.
(b) Posting of Requests for Service.
(1) Schools, libraries, and consortia including
those entities wishing to receive discounts
for eligible services under this subpart
shall submit requests for services to a
subcontractor designated by the administrator
for this purpose. Requests for services shall
include, at a minimum, the following
information, to the extent applicable to the
services requested:
(i) The computer equipment currently
available or budgeted for purchase for
the current, next, or other future
academic years, as well as whether the
computers have modems and, if so, what
speed modems;
(ii) The internal connections, if any, that
the school or library has in place or
has budgeted to install in the current,
next, or future academic years, or any
specific plans for an organized
voluntary effort to connect the
classrooms;
(iii) The computer software necessary to
communicate with other computers over an
internal network and over the public
telecommunications network currently
available or budgeted for purchase for
the current, next, or future academic
years;
(iv) The experience of, and training received
by, the relevant staff in the use of the
equipment to be connected to the
telecommunications network and training
programs for which funds are committed
for the current, next, or future
academic years;
(v) Existing or budgeted maintenance
contracts to maintain computers; and
(vi) The capacity of the school's or
library's electrical system in terms of
how many computers can be operated
simultaneously without creating a fire
hazard.
(2) The request for services shall be signed by
the person authorized to order
telecommunications and other supported
services for the school or library and shall
include that person's certification under
oath that:
(i) The school or library is an eligible
entity under Sects. 254(h)(4) and 254(h)(5)
of the Act and the rules adopted under
this subpart;
(ii) The services requested will be used
solely for educational purposes;
(iii) The services will not be sold, resold,
or transferred in consideration for
money or any other thing of value;
(iv) If the services are being purchased as
part of an aggregated purchase with
other entities, the request identifies
all co-purchasers and the services or
portion of the services being purchased
by the school or library;
(v) All of the necessary funding in the
current funding year has been budgeted
and approved to pay for the
"non-discount" portion of requested
connections and services as well as any
necessary hardware, software, and to
undertake the necessary staff training
required to use the services
effectively;
(vi) The school, library, or consortium
including those entities has complied
with all applicable state and local
procurement processes; and
(vii) The school, library, or consortium
including those entities has a
technology plan that has been certified
by its state or an independent entity
approved by the Commission.
(3) After posting a description of services from
a school, library, or consortium of these
entities on the school and library website,
the administrator's subcontractor shall send
confirmation of the posting to the entity
requesting services. That entity shall then
wait at least four weeks from the date on
which its description of services is posted
on the website before making commitments with
the selected providers of services. The
confirmation from the administrator shall
include the date after which the requestor
may sign a contract with its chosen
provider(s).
These regulations may be subject to change when the
applications are issued; however,schools interested in
receiving support may wish to compile the information the
FCC is requesting.
Since the Universal Service regulations were issued the FCC
has made two reconsiderations affecting the implementation
of the regulations. First the FCC specified that the
effective date discounts will apply as January 1, 1998.
Discounts will apply to approved schools and libraries for
services received after January 1, 1998.
The second reconsideration addresses existing contracts.
According to the regulations:
54.500 Terms and Definitions.
(b) Existing contract. For the purpose of
section 54.511(c), an "existing contract" is
any signed contract for services eligible for
discounts pursuant to this subpart between an
eligible school or library as defined under
54.501 and a service provider that either:
(1) was signed prior to November 8,
1996, or
(2) is limited to services provided
before December 31, 1998, and was
signed on or after November 8,
1996, but before the first date
that the universal service
competitive bidding system
described in 54.504 is
operational. The competitive
bidding system will be deemed to be
operational when both the universal
service administrator is ready to
accept and post requests for
service from schools and libraries
on a website and that website may
be used by potential service
providers.
This reconsideration means that any contract entered into
before November 8, 1996, will be considered exempt from the
competitive bidding and web posting provision for the life
of the contract. Any contract entered into after November 8
but before the administrator is ready to receive
applications will be considered existing for 1998 only.
Contracts signed during the latter period will be subject to
competitive bids for the 1999 application process.
For questions or current Department activities related to
Universal Service Discounts, contact Greg Weisiger, VSEN
Administrator, at (804) 692-0335. Additionally, information
is continuously updated on the DOE Homepage.
RTL/emt