Erate Category 2 Training for PA Public Schools

E-rate Category 2 Training for PA Public Schools Presented by Julie Tritt Schell PA E-rate Coordinator for the Pennsylvania Department of Education November 2016 1

Category 2 Overview • Category 2 funds Wi-Fi and related wiring, infrastructure and equipment inside buildings • Technology plans are no longer required • Intention is to have all schools and libraries obtain Category 2 funding over a rolling 5 -year period • All competitive bidding requirements will continue to apply and applicants can only apply for what they need • Form 471 application is required to be submitted each year • Maximum discount = 85% 2

Category 2 E-rate Budget Caps • Each school is entitled to a pre-discount cap of $150 per student, or a minimum building cap of $9200, over a rolling five years – AVTS budgets based on total number of students – The “Rolling 5 Year Cycle” begins the first year any of a district’s schools obtain E-rate funding – Change to previous guidance – FY 2020 C 2 funding system is still uncertain, despite “Rolling” concept • Non-Instructional Facilities (NIFs): – Don’t have C 2 budgets because there is no student population – If equipment is located in the NIF and serves a school(s), that school’s budget can be used to fund the equipment 3

Category 2 E-rate Budget Caps • Stipulations: – Money is allocated per school (not on a shared-district basis), and applicants cannot move funding from one school to another – Commitment must be spent during the funding year • Funding Year 2017 = April 1, 2017 – September 30, 2018 – There is no provision to allow applicants to spend funds and be reimbursed in a later year – Not required to use the full budget in a single year • Apply for what equipment/services are needed for that year 4

Category 2 – Enrollment Anomalies • Increases/Decreases in Enrollments from Year to Year – If enrollment increases, you receive benefit of extra students next year • Think about this in terms of updating enrollment/NSLP in EPC – If enrollment decreases, you aren’t required to pay back funds • Budgets for New Schools – Estimate the number of students who will be attending the new school and seek funding based on that estimate • However, if an applicant overestimates the number of students who enroll in that school, it must return to USAC by the end of the next funding year • Students Who Attend Multiple Schools – Such as those that attend CTCs or Intermediate Units part-time, may be counted by both schools in order to ensure appropriate LAN/WLAN deployment for both buildings 5

Category 2 Funding Budget Example Maximum Budget 5 -Year Density E-rate Multip Budget Student Discount lier Cap Count School Plainfield Elementary Jacksonville Middle School Newville High School E-rate District's Funding Share % Cap 50 $150 $9, 200* 70% $6, 440 105 $150 $15, 750 70% $11, 025 325 $150 $48, 750 70% $34, 125 District's Share $ 30% 30% $2, 760 $4, 725 $14, 625 • The Budget Cap is the pre-discount price. E-rate discounts will then apply on top of the budget cap. • In this example, district would still owe 30% nondiscounted share. * Although 50 x $150 = $7, 500, the minimum floor is invoked because school has less than 62 students 6

Category 2 Budget “Hits” • Any funding commitments that include a school as a recipient of service will count against your pre-discount budget for that entity – C 2 budget is “hit” at time of commitment, not disbursement • If not all committed funding is spent, you can file a Form 500 to return the remaining unused commitment to USAC • If entities are sharing the service, USAC will need specific information so that they know how to apply the returned funds to specific entities • USAC C 2 Budget Calculator, including impact of previously-committed funds, should be available soon 7

Calculating Remaining C 2 Budgets • Multiply each school's current enrollment by $150, then subtract the pre-discount amount of any C 2 E-rate funding used in FY 2015 or FY 2016 • EXAMPLE: – School A had 250 full and part time students in FY 2016. Their C 2 budget was $37, 500 ($150 x 250). – School received C 2 funding commitments for $25 k in 2016 (this is the pre-discount amount, not what was requested from E-rate) – The remaining budget available for next 4 years (FY 2017 – 2020) would be $12, 500 ($37, 500 - $25, 000) – IF…. School A's enrollment for FY 2017 increases to 275, they would have an additional $3750 ($150 x additional 25 students) for FY 2017 – School A's remaining C 2 budget, adjusted for FY 2017 enrollment, would be $16, 250 ($12, 500 + $3750) – Hint: If enrollment declined for FY 2017, use last year’s enrollment data 8

What’s Eligible and Not Eligible for Category 2 Funding? 9

Category 2 Ineligible Items • All Voice Components • – Including VOIP • components • • Servers (except caching) • • Software (except eligible equipment operating software) Storage Devices Video Components End-User Devices Filtering and DDOS components 10

Category 2 Eligible Items • • Wireless Access Points Structured Cabling Caching Servers *new* Firewalls Network Switches Antennas Routers Racks and UPSs – That support eligible equipment only • Wireless LAN Controllers • Basic Maintenance Services for eligible equipment – Repair of equipment, cable maintenance, basic tech support, configuration changes • Cloud-based functionality of this equipment 11

Category 2 Eligibility, etc. . . • Installation and configuration are eligible – Do not have to be provided by the same vendor • Also eligible: – Taxes, surcharges and other similar reasonable charges – Shipping charges – Training on how to use eligible equipment • Multi-year licenses are eligible and can be requested in full in first year • Eligible equipment may be purchased and/or installed on or after April 1 prior to the beginning of the funding year – Invoices cannot be submitted prior to July 1 – Must be purchased/installed before September 30 of the following year • September 30, 2018 for FY 2017 • Even if installation isn’t part of FRN • Can request 1 -year extension if request is made before September 30 – Use Form 500 to submit request 12

Category 2 MIBS • Managed Internal Broadband Services (MIBS) which cover the operation, management, or monitoring of a LAN or WLAN • Could also include the leasing of equipment • Paying an outside vendor to own/maintain the equipment • Paying an outside vendor to maintain school-owned equipment • Eligible for $30/year/student • Unless FCC extends eligibility, these items will sunset eligibility at the end of FY 2019 13

Category 2 Procurement Options/Requirements 14

E-rate Bidding Requirements • Applicants should not contact a potential vendor ahead of bidding to seek equipment list (E-rate rule) – Service providers are allowed to: • Answer general questions about the products and services they sell in response to applicant inquiries, but they may not prepare any part of a RFP or spec sheet that will be used by the applicant for conducting a competitive bid procurement. – If you don’t know exactly what equipment you need: • List general equipment needs (wireless controller, WAPs for 35 classrooms, and installation), and then perhaps conduct a site walk-through, or • Contract with technology professional for equipment list • Equipment list MUST allow for equivalent manufacturer’s products to be bid (E-rate rule) – “Cisco 48 -port Po. E Switch or equipment that is equivalent in functionality and quality” – May include a requirement that equivalent equipment must be fully interoperable and compatible with District’s existing XYZ equipment • Be sure to list what your existing equipment is 15

Public School Category 2 Bidding Options Public schools in PA have 2 bidding options for Category 2 equipment/services: 1. Post Form 470 and Issue RFP or 2. Conduct PEPPM Mini-Bid • Co-Stars contract is NOT E-rate eligible because it’s not competitively bid with price being the most heavily weighted factor 16

Form 470 plus RFP Post Form 470 and RFP – RFP required if cost of equipment exceeds $19, 400 (state law) – Form 470 and RFP bidding must be done concurrently and bidding window required to be open for at least 28 days before bids are due (E-rate rule) – RFP must be published in at least 2 local newspapers of general circulation once/week for 3 consecutive weeks (state law) – Assuming all RFP requirements have been met, schools must accept the lowest-price bid (state law) • Cannot consider other factors in bid evaluation – School board must approve contract prior to signing • Contract must be signed before submitting Form 471 – RFP MUST be uploaded with 470 when 470 is posted (E-rate rule) • All addenda and additional information provided to vendors also must be uploaded into EPC at time of issuance *** 17

PEPPM Mini-Bid Conduct PEPPM Mini-Bid – No Form 470 required (PEPPM filed Form 470 when contracts were being competitively bid) • Newspaper bidding also not required – More appropriate for equipment/installation, rather than structured cabling project – Very specific bidding steps must be followed, but they are spelled out at: http: //e-ratepa. org/? page_id=6121 18

PEPPM Mini-Bid Steps – Join PEPPM Consortium in EPC (if not previously done) – Develop equipment/services list and e-mail to all Awarded Vendors in specific “category” • Can list preferred manufacturer, but must allow “equivalent manufacturers” to bid • Send to at least one reseller if Awarded Vendor uses resellers • Use and edit the cover e-mail template to fit your needs – Allow vendors minimum of 2 weeks to submit bids – Conduct bid evaluation among all qualified bids – Can consider other factors besides price • Price of eligible equipment must be the most heavily weighted factor – Have school board approve award – Sign contract with the vendor • Can be as simple as signing vendor quote • Be sure to include these items: – Contract signing date (must be before 471 filing date) – Contract term: 4/1/2017 through 9/30/2018 – Purchase is contingent upon E-rate funding and local funding approval • Contract must be signed prior to creating Contract Record and 471 – Create Contract Record in EPC • Use those contract dates – not PEPPM dates – in EPC Contract Record • Answers to Contract Record Questions on web • EPC Contract Record requires you to list # of bids received 19

Example: PEPPM Mini-Bid Category List Filter by ‘Category’ then send equipment list to all vendors with x Manufacturer Firewal Wireless Cabling l PEPPM Awarded Equipmen /Conne Caching Equipi Route Vendor Name t/Services ctors Servers ment Switches rs UPS Racks X X X Awarded Vendor Contact Name Contact Email Uses Resellers? John johns@acecom Yes Samborski puters. com patrick. foster Yes Patrick Foster @adtran. com sales. Yes operations@ae Yes Zach Harris rohive. com Yes X X Neal Tilley X X Ed Floyd ACE Computers Ace Computers Adtran, Inc. ADTRAN Aerohive Networks Alcatel-Lucent Enterprise USA, Inc. Alcatel-Lucent Allied Telesis, Inc. En-Net Services, LLC x X e. Plus Technology, Inc. Carahsoft Technology Arista Networks Corporation APC Aruba Networks Corporation Aruba Networks X X X neal. tilley@alc atel-lucent. com efloyd@ennetservices. co m Nick ndarchangelo D’Archangelo @eplus. com X Jack Dixon X Andrew Tanguay Jack. Dixon@Ca rahsoft. com atanguay@aru banetworks. co m Yes No No No Yes 20

Bidding: PEPPM Bid Evaluation Example Maximum # Points Vendor 1 Vendor 2 Vendor 3 Price of Eligible Equipment/Services 40 40 30 30 Ability to Integrate Equipment into Existing Network 25 25 Previous Experience with the District/Knowledge of District's Infrastructure 25 25 5 10 Quality of References 10 10 100 70 75 Evaluation Criteria 21

PEPPM vs RFP PEPPM • • Don’t have to post Form 470/Issue RFP Don’t have to advertise in newspaper DO have to conduct mini-bid of every vendor that sells equipment in that category Don’t have to wait full 28 days during mini-bid process Can consider non-cost factors as long as costs of E-rate eligible equipment/services are most heavily weighted factor Can require compatibility and interoperability with existing equipment More appropriate for equipment/installation, rather than cabling project RFP/470 • • Must post 470 and upload RFP More appropriate for cabling projects, in addition to equipment/installation Can provide greater specificity about requirements Can require compatibility and interoperability with existing equipment Can list binary disqualification factors Don’t have to solicit bids from any vendor Cannot consider non-cost factors during bid evaluation. If all RFP criteria have been met, must select lowest bid 22

Step-by-Step Documents • On the PA E-rate Website, step-by-step documents are available for PEPPM Mini. Bidding 23

Add’l Product Lines as of 1/1/2017 Manufacturer Name Cabling Caching Firewall Routers Switches UPS WAPs Wless Controller ADVA Optical Networking Allot Communications Allworx Brocade Cirrus. Works Cloudgenix Cylance Edimax X X X X X X X X Extrahop X Fluke X Gigamon X Juniper Networks X X X Log. Rhythm X Microsoft - Software Minuteman Mojo Networks X X X X X Netskope X Packet. Viper, LLC Procera Riverbed Solar. Winds Sonic. Wall Toshiba - Security Products Urcast Network Watch. Guard West Penn Wire X X X X 24

Contract Records in EPC • All C 2 requests must have signed contracts • All contract records must be completed in EPC prior to completing the Form 471 – All contract related information (470 #, contract signing dates, extension info, vendor, SPIN, etc. ) will be done outside of 471 in EPC – Then just refer to that contract in the 471 • Hint: Use a good Contract Nickname (Year, Manufacturer, Vendor) – Not required to upload contracts into EPC • Good idea for all C 2 contracts 25

General Category 2 Bidding Timeline Ø Post 470/Release RFP/Issue PEPPM Mini-Bid by Dec 1 Ø Bids due Dec 29 Ø Evaluate bids Dec 30 – Jan 15 Ø February board approvals of contracts Ø Sign contracts by February 27 Ø Upload contracts to EPC Contract Wizard by March 1 Ø Complete 471 no later than March 5 26

After the FCDL Arrives. . • Purchase Orders – One PO for each FRN (if possible) • Submit the Form 486 • Invoicing (applicant choice of discounted bills) – After equipment received/discounted portion paid • Create and Maintain Asset Inventory – Sample available • Maintenance records – Require detailed invoices (what, when, where) 27

Purchasing Prior to FCDL. . . • May purchase Category 2 equipment as early as April 1 prior to the start of the funding year -- even with no FCDL – Only make early purchases if they are NOT contingent on E -rate funding and you plan to pay for your equipment in full and seek E-rate reimbursement after your Funding Commitment Letter arrives • Be sure your PO is for the FULL amount, not the nondiscounted share • Submit Form 486 until AFTER the FCDL arrives • Submit Form 472 BEAR to USAC once your FCDL arrives, and after you have paid your vendor invoice. 28

Equipment Transfer Rules • Equipment MUST stay at the location indicated on the Form 471 for a period of 3 years after the date of purchase – After that, the equipment can be transferred to other eligible entities – Asset Inventory must be updated • If a location closes within 3 years, equipment from that closed location can be transferred to another eligible entity – USAC must be notified of such equipment transfers using the Form 500 – Asset Inventory must be updated • After 5 years from the date of installation, equipment can be disposed of, sold, transferred, traded, etc. with no USAC notification required – If equipment is sold, no funding is required to be returned to USAC 29

Equipment Substitution Rules • To change approved equipment, either due to clerical error on your Item 21, or because the vendor is now substituting a newer/different model number, you must submit what USAC refers to as a "Service Substitution Request" • Service Substitution must generally have the same functionality (i. e. data distribution, wireless distribution, cabling, etc) • If the service substitution results in a change in the prediscount price, the E-rate funding commitment will be adjusted to the lower cost • File Form 500 to return “commitment” to school’s C 2 budget 30

Reminder: Keep Everything! Expanded Document Retention Rules – The document retention requirement has been expanded from 5 years to 10 years from the last date to receive service or service delivery deadline, whichever is later Be sure to coordinate this new requirement with your business office 31

Questions? 32