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News and Views
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E-Rate Rules - Now and Later
In September 2010, the FCC issued rules that made changes to the E-rate program, and kept the door open for future changes. The approved rules include:
* Making DARK FIBER eligible. In the past, the only way fiber could be brought into a school would be if a service provider brought a fiber connection directly into the school. However, now, schools can tap into pre-exisiting fiber networks in the community by running their own connecting hardware to the fiber network that may be located nearby (for example, on a telephone pole a few blocks away from the school).
* Reducing the scope of BASIC MAINTENANCE. Basic maintenance cannot include "unbundled" warranties for network equipment. An example of this is Cisco SmartNet, which provides protection for equipment if it fails. Basic maintenance only pays for services that are actually performed, rather than paying for protection "in case it is needed."
* Eliminating the TECHNOLOGY PLAN requirement for Priority One applications. Technology Plans are still required for Priority Two funding requests.
There are many other proposed new rules not YET approved, but that could be approved in the future. These proposals could affect PRIORITY TWO. The idea behind these rule changes is to make money available to more applicants. However, since there are not significant new dollars coming into E-rate, the rules take the existing available dollars and distribute them differently.
E-Rate Rule Changes that may be enacted in the future
* Proposed Change #1: Elimination of Two-in-Five Rule
* Proposed Change # 2: Discount Calculation for Districts
* Proposed Change # 3: Funding Cap for Priority 2 ------------------------------------------------------------
Extend the Life of Your Funding!
Contrary to popular belief, funding for Internal Connections projects does not have to be completely spent within twelve months of approval. In fact, some applicants stretch their funding over a number of years before it is all spent. Extending funding can be done, as long as it is for a good reason! Here are two ways funding can be extended.
Service Substitution
By the time projects get approved, enough time may have passed that the applicant’s needs may have changed, or the requested equipment may have been replaced by newer models. These changes need to be approved, and the process to get approval is called Service Substitution. When a substitution is submitted and approved, the applicant gets an automatic extension of up to one year. An applicant can submit multiple substitutions for a single FRN.
Extension Request
If the applicant needs more time to complete a project for a good reason, the applicant can submit a service delivery deadline extension letter, indicating the reason and the new requested service end date.
In either case, extending funding will also involve submitting a Form 500, and invoice extension request, and possibly a contract extension with the vendor.
This is a lot of paperwork, but it is worth the effort if you need more time to spend your E-rate dollars!
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Top Applicant Tips to Get More Funding
A district in Northeast Ohio has 9 buildings and a shared discount of 58%. This district can’t get Internal Connections, right?
Wrong – the district just doesn’t know how to apply for it!
Many districts are not aware that they have options on how to structure their funding requests, especially for Priority Two. Applicants with several buildings at different discounts typically use the shared district discount for all funding requests. However, it may be advantageous to submit different funding requests for the buildings that have higher discounts. Let’s take a closer look at our NE Ohio district.
Of the nine buildings, one of the buildings has a 90% discount with 189 of 245 students eligible for free and reduced lunch, and another building has an 80% discount with 147 of 246 students eligible. That means that at a minimum, the district can apply and get approved for funding for the 90% school. If the district puts the 90% and 80% together in an FRN, it should get approved at 85%. The district could potentially add a small 60% discount school into the mix and get that approved for Internal Connections too.
Please note -- The FCC may still be considering a rule to take away this application procedure. It would require districts to apply only using the shared district discount, with no options for separate FRN's. If your district can attain funding by applying for its highest discount schools in a separate FRN, the 2012 funding year may be your last and best opportunity.
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