[Erate] E Rate Central News for the Week of April 11, 2005

Mon Apr 25 10:51:50 PDT 2005

I am sorry this was delayed; I was out for the week of April 11 and
April 18.

E-Rate Central News for the Week of April 11, 2005

*	Technology Plan Updates for FY 2005
*	Early Form 470 Filings for FY 2006
*	Personal Usage Reimbursement for Cellular Service
*	More E-Rate Indictments

	The E-Rate Central News for the Week, prepared by E-Rate
Central, is sponsored by the State E-Rate Coordinators' Alliance ("SECA
<http://www.e-ratecentral.com> ").  Official SLD news is provided in the
"Important Notices" section of the SLD's Web site
<http://www.sl.universalservice.org>
(http://www.sl.universalservice.org).  Additional E-rate information and
archived copies of this newsletter are located on the E-Rate Central Web
site <http://www.e-ratecentral.com>  (http://www.e-ratecentral.com).

*	Technology Plan Updates for FY 2005

		Although funding for FY 2005 is not expected to begin
being approved until early May, applicants whose approved technology
plans expire on June 30th need to be revising their plans and getting
them re-approved.  While the first deadline for filing a Form 486 for FY
2005 will be October 29th - and the Form 486 is the one that requires
applicants to certify that they have approved plans - E-rate rules
require that plans be approved by the Service Start Date.  In most
cases, therefore, applicants receiving FY 2005 discounts must have an
approved technology plan by July 1, 2005.

		Applicants who already have technology plans approved
through next year should also think about reviewing their plans now to
make sure that they include references to all E-rate eligible services
included in their FY 2005 applications.  (In fact, they should plan to
review their plans again in the fall to make sure the plans cover
services which will be requested in their Form 470s for FY 2006.)
Remember, for E-rate purposes, that plans should cover all
telecommunications services, not just Internet and networking services.

*	Early Form 470 Filings for FY 2006

	It will probably be a month or two before the SLD posts a notice
that the FY 2006 online Form 470 system is ready and available.  For
most applicants, there is no need to file - and, particularly in the
case of tariff or month-to-month services, should not file - Form 470s
for FY 2006 until the fall or at least until July.

	However, there are exceptions.  Applicants needing to solicit
bids for new services this spring will have to properly file
corresponding Form 470s now in order to make any resulting contracts
eligible for E-rate discounts in FY 2006 and beyond.

	The SLD will accept Form 470s now, but they must be filed with
care.  The basic problem is that the SLD will likely be using a new
version of the Form 470 for FY 2006 (including new certifications).  The
online filing version of the current Form 470 is still available, but
the only option for the funding year field in Block 1 is FY 2005:
07/01/2005 - 06/30/2006.

	Based on instructions that the SLD provided under similar
circumstances last year, there are two ways around this problem.  Both
of which involve making it clear that the Form 470 is being filed for FY
2006.

(1)	If the online filing system is used, language must be provided
in the Item 13 text field "...to clearly identify the services requested
on this Form 470 as beginning after the Allowable Vendor
Selection/Contract Award date for this Form 470."

(2)	If filing a paper Form 470, the correct dates for FY 2006
(07/01/2006 - 06/30/2007) can be typed in Item 2, but the same
clarification language is still required in Item 13.

	Applicants needing to use this early filing process should
carefully monitor SLD announcements when the real FY 2006 version of the
Form 470 is released.  There may be a requirement to supplement the
early filings with updated certifications or other information required
by the new Form 470.

*	Personal Usage Reimbursement for Cellular Service

		In a series of school district audits recently completed
by the New York State Controller, a common finding was the lack of
adequate policies and controls on cellular phone usage.  One exception
was a district singled out and praised for its strong financial
oversight, exemplified by the strict enforcement of a policy requiring
employee reimbursement for personal calls (amounting to several thousand
dollars per year).

		Hypothetical question:  If the SLD were to closely
examine cellular E-rate invoices for this district, would the district's
E-rate policies be similarly praised?  The answer would depend on
whether the district subtracts the employee payments for discount
purposes.  If cell phone charges for "educational purposes" are E-rate
eligible, as they are, then it follows that charges for personal use are
not.

		If the BEAR reimbursement process is used, then
accounting for personal charges is easy.  The district need only deduct
the personal fees from its total cellular charges when filing its
cellular BEAR.

		If the cellular carrier is discounting the district's
bills, the situation becomes more difficult.  Since the carrier can't,
by itself, know what charges have been recouped from the employees, it
is up to the district to tell them.  Even then, the carrier must have a
procedure in place to exclude these charges from its discount
calculations.  If this cannot be done easily, then we would recommend
that applicants with cellular personal use repayment policies use the
BEAR process for E-rate discounting.

*	More E-Rate Indictments

	Last Thursday, the Justice Department announced that a federal
grand jury in San Francisco returned a 22-count indictment against six
companies and five individuals on charges of fraud, collusion, aiding
and abetting, and conspiracy in connection with E-rate projects at
schools in seven states - Arkansas, California, Michigan, New York,
Pennsylvania, South Carolina, and Wisconsin.  A copy of the announcement
is available at DOJ Release or
http://www.usdoj.gov/opa/pr/2005/April/05_at_169.htm.  The details on
the 22 count indictment are available at DOJ Attachment or
http://www.usdoj.gov/atr/public/press_releases/2005/208469a.pdf.

	Since the companies and individuals listed were involved in
previous actions, these indictments apparently represent the fruits of a
broader investigation involving the case of a subsidiary of NEC.  The
best information to date on the NEC case can be found in the testimony
of an attorney for the City of San Francisco available at SF Testimony
or http://www.e-ratecentral.com/FCC/SanFranciscoErateTestimony.pdf.

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Disclaimer: This newsletter may contain unofficial information on
prospective E-rate developments and/or may reflect E-Rate Central's own
interpretations of E-rate practices and regulations. Such information is
provided for planning and guidance purposes only. It is not meant, in
any way, to supplant official announcements and instructions provided by
either the SLD or the FCC.

Patricia K. Middelburg, MEd, PMP
Project Manager and State E-rate Coordinator
Department of Administrative Services
Information Resources Management Division
955 Center Street NE, U510
Salem, OR 97301-2558
Telephone:  503.373.1365
Fax:  503.378.8333
pat.middelburg at das.state.or.us

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