[Erate] E Rate Central News for the Week of April 3, 2006

Mon Apr 3 09:59:53 PDT 2006

E‑Rate Central News for the Week of April 3, 2006

*        Wave 42 Funding for FY 2005

*        Focusing on Success: A New SLD Report

*        SPIN Changes and FRN Splits

*        Pre-K and Head Start Programs

*        New SLD Deadlines Tool 

The E‑Rate Central News for the Week is prepared by E‑Rate Central.  E-Rate Central specializes in providing consulting, compliance, and forms processing services to E-rate applicants and service providers.  To learn more about our services, please contact us by phone (516-832-2880) or by e-mail <mailto:services at e-ratecentral.com>  (services at e-ratecentral.com).  Additional E-rate information is located on the E‑Rate Central Web site <http://www.e-ratecentral.com/>  (http://www.e‑ratecentral.com <http://www.e%1eratecentral.com/> ).

Wave 42 Funding for FY 2005

Wave 42 for FY 2005 is scheduled to be released on Wednesday, April 5th, for an estimated $27 million.  This will bring total FY 2005 funding to just over the $1.5 billion milestone mark.

Internal Connections funding remains at the 88% discount threshold level.

Focusing on Success: A New SLD Report

One of the more positive aspects of the SLD’s 1000 Site Visit Outreach Initiative, which began in January 2005, has been that it has provided an extensive view as to how applicants are actually using E-rate.  A January 2006 report, just released in March, provides a comprehensive state-by-state summary of the first year’s 851 site visits.  More interestingly, the report features thumbnail sketches of the benefits being realized by numerous schools and libraries.  For a program that has suffered its share of negative press, this report provides a clearly uplifting view.  We only wish that the report’s release had been more widely publicized.

A copy of the report, appropriately entitled Focusing on Success: Examples of How the Universal Service Fund is Helping Schools and Libraries around the Country, is available at http://www.universalservice.org/_res/documents/about/pdf/usf-success-stories.pdf <http://www.universalservice.org/_res/documents/about/pdf/usf-success-stories.pdf> .

SPIN Changes and FRN Splits

At this time of the year, many applicants who are beginning to do BEARs for the first 7-8 months of service are finding that they also need to do SPIN changes and/or FRN splits to reflect new service provider relationships.  Here are the three basic situations that may need to be addressed:

1.      If the actual service provider associated with an FRN has not changed, but the current SPIN is incorrect, the applicant must file a Corrective SPIN Change.  This situation typically arises if: (a) the applicant originally requested funding under an incorrect SPIN (perhaps using the SPIN for another of the service provider’s subsidiaries); (b) the applicant had applied for funding under an expiring state master contract (using the 143999999 SPIN) that has subsequently been renewed; or (c), the service provider has consolidated SPINs or changed its SPIN as a result of a company sale or merger.  In the latter case, the service provider may have asked the SLD to make a global SPIN change which automatically updates the SPINs on affected FRNs.  Instructions for making this type of change are available at http://www.sl.universalservice.org/reference/CorrectiveSpin.asp <http://www.sl.universalservice.org/reference/CorrectiveSpin.asp> .

2.      If a completely new service provider is being used — and has been used since services started for the funding year — the applicant must file an Operational SPIN Change.  An operational change is a little more complicated, often involving pricing changes, and requires certain certifications on contractual and procurement issues.  Instructions for making this type of change are available at http://www.sl.universalservice.org/reference/OperationalSpin.asp <http://www.sl.universalservice.org/reference/OperationalSpin.asp> .

3.      If the applicant changes service providers during the year after services have already begun (or decides to split the business between the original service provider and another one), the SPIN change may involve an FRN Split so that the original funding amount can be allocated between the two suppliers.  Unfortunately, there is little definitive information in the SLD’s Reference Section to deal with this procedure.  We found only the following statement in SLD service provider conference call minutes:

In some cases, applicants requesting a SPIN change want to keep the existing service provider for some of the requested services and allow a second service provider to provide the remainder of the services. The SLD cannot provide a single answer as guidance to cover all of these situations.

Our advice for dealing with these types of situations is as follows:

a.       If service was switched from one provider to another midway through the year, wait until all BEAR or SPI invoices have been approved on services from the first provider, then file an Operational SPIN Change as discussed above.  The SLD will most likely handle this by splitting the FRN.

b.      If service is being split between two suppliers, make sure that the Operational SPIN Change clearly reflects the need to split the funding between the two service providers and indicates how much of the original funding is to be transferred to the new FRN.

c.       Once the FRN is split, the applicant will receive a Revised Funding Commitment Decision Letter showing the original FRN, now with reduced funding, and the new FRN with its share of the original funding.

d.      Important:  If a new FRN is created via a split, the applicant must remember to file a new Form 486 for that FRN.

Pre-K and Head Start Programs

Although, from a school perspective, the E-rate program is predominately designed to serve K-12 students and facilities, the SLD recognizes that differences in definitions of primary and secondary education under various state laws may make pre-kindergarten, juvenile justice, and adult education students and/or facilities eligible for E-rate funding as well.  State determinations of eligibility of these three classifications are updated every two years.  A current eligibility list, on a state-by-state basis, is available on the SLD Web site at http://www.universalservice.org/sl/applicants/step01/non-traditional-k-12/k-12-eligibility-table.aspx <http://www.universalservice.org/sl/applicants/step01/non-traditional-k-12/k-12-eligibility-table.aspx> . 

Pre-K is a particularly important category because it is so often provided by public and private schools.  Even when considered eligible, however, E-rate rules do not include a rigorous definition of pre-K.  The underlying concept is that “pre-K” refers to educational programs — not day care programs — for younger children below kindergarten age.

The SLD has confirmed that, under this concept, Head Start programs would be considered pre-K.  Last fall, the National Head Start Association submitted comments to the FCC proposing that Head Start programs in all states be considered E-rate eligible.  So far the FCC has not acted upon this proposal.  Unless and until the FCC so rules, the eligibility of Head Start programs will vary by state.  If pre-K students are eligible in a state, Head Start students will be also.  Similarly, if pre-K facilities are eligible in a state, separate Head Start facilities will be too.

New SLD Deadlines Tool

As many applicants know all too well, E-rate is a deadline driven program.  There are deadlines for virtually every form and procedural step.  Miss any deadline and you’re likely to lose a portion, if not all, of your funding.

The problem with many of these deadlines is that they are applicant-specific.  Unlike the Form 471 filing deadline, which applies to all applicants, many other deadlines depend upon when a certain applicant was funded, when services were to start, or when another SLD decision was reached.  Certain deadlines can be extended upon request; others cannot.

As an aid — and perhaps as a warning — the SLD has just posted a new Deadlines Tool that lists all the deadlines (21 in all) and describes how each is determined.  In the case of deadlines that depend upon two dates, the Tool includes a nice Web-driven calculator.  As an example of its use, try the following Form 486 example:

1.	Assume that you are an applicant just funded for FY 2005 in Wave 41 this past Wednesday for a service that started at the beginning of the funding year.
2.	Highlight the 29th of March 2006 on the small left-hand calendar under FCDL Date.
3.	Scroll back through the right-hand calendar to July 2005 and highlight the 1st.
4.	Click the “Calculate” button.
5.	The result shows “Calculated Deadline:  07/27/2006.”

At the moment, the Deadlines Tool is a little difficult to find, but we expect it to be included shortly in the list of Search Tools.  For now, you can find it at http://www.universalservice.org/sl/tools/deadlines/default.aspx?WT.mc_id <http://www.universalservice.org/sl/tools/deadlines/default.aspx?WT.mc_id> . 

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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

c/o 530 Airport Road SE

Salem, OR 97301

503.373.1365

Fax: 503.378.2736

pat.middelburg at state.or.us

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