ERATE UPDATE FOR PENNSYLVANIA APPLICANTS Presented by Julie

E-RATE UPDATE FOR PENNSYLVANIA APPLICANTS Presented by: Julie Tritt Schell Pennsylvania E-rate Coordinator October 2011 Happy 15 th Birthday, E-rate! 1

WEBINAR QUESTIONS Ask questions 2 ways: § Text questions using tool on left side of the window. § Raise hand using the tool next to your name and I will call on you to use the mic. 2

AGENDA FY 2010, 2011, 2012 New CIPA Requirement Maintenance SPIN Changes Applicant/Vendor Rules Gift Rules 470 Disqualifications Contract Extensions Bid Evaluations M/C Errors Filtering PEPPM Requirement 3

ETC If you’re not a member of the PA E-rate Listserve, e-mail Julie at jtschell@comcast. net If you need beginners’ training, register at: http: //www. e-ratepa. org/training_outreach. htm Nov 1 – Allentown Area (IU 21) Nov 4 – Harrisburg Area (IU 15) If you’d like to download a copy of the full 2012 E-rate Training Manual, it’s posted on www. e-ratepa. org website under Helpful Documents (at the top of the page) 4

FY 2010 (YEAR 13) Funding Year ended June 30, 2011 for recurring services Deadline for submitting BEARs (Form 472 s) is Friday, October 28, 2011 § List of affected entities sent to listserve § Deadline for submitting invoices for non-recurring services is January 28, 2012 (unless an extension has been granted) File for extension if you haven’t submitted your BEAR! § Example sent to listserve on Oct 26 File Form 500 if you don’t need the funding All Priority 2 requests will be funded for FY 2010 § All 80% and below requests being reviewed and being funded now § Because they’re being funded after March 1, you will have until September 30, 2012 use funding 5

REMINDER ABOUT ONLINE BEARS After you submit an online BEAR, you will receive 2 e-mails: 1) Immediately after you submit 2) After the vendor certifies the BEAR If you haven’t received the second e-mail, contact your vendor to remind them to certify by deadline To track your BEARs (paper or online) using the Online System, go back to the Online BEAR page and click on Track Form § After submitted by applicant to vendor: Pending Validation § After certified by vendor: Passed Validation § After paid by USAC: Completed If you don’t have your paper BEAR postmarked by Friday, or if your vendor doesn’t certify your online BEAR by Friday, Occt 28, you must request an extension If you’re on my list and you already submitted your BEAR, it’s because either they haven’t yet mailed your BEAR check, or they are going to $0 -fund it. 6

REMINDER ABOUT $0. 00 -FUNDED BEARS When you receive the white BEAR notification letter, be sure to open ASAP If the amount on the first page says $0. 00 -funded, it does not mean ‘denial’ Create a new BEAR, correct the mistake and resubmit If resubmitting after October 28, file for an invoice deadline extension, and then resubmit after extension is approved Most common reason for $0. 00 -funded BEARs is listing that the service started 7/1/2011, instead of 7/1/2010 7

INELIGIBLE CHARGES ON BILLS When determining the amount to list on a BEAR, create a quick spreadsheet showing each month’s total charges, and total ineligible charges What are the ineligible charges? Varies by vendor, but these are known to be ineligible: Property Tax Fees Universal Service Administrative Fee USF fees themselves ARE eligible Late payment or finance charges USF Cost Recovery Fees Paper statement fees Equipment charges (on P 1 bills), such as cell phones Equipment insurance fees Directory listing fees Non-published phone number fees Payphone service Personal usage Here’s an example of what your spreadsheet may look like: 8

Verizon Account: 215 -235 -1232 Ineligible Charges Total Eligible Charges non-published # July $ 200. 10 $ 2. 75 $ 197. 35 Aug $ 200. 20 $ 2. 75 $ 197. 45 Sept $ 200. 30 $ 2. 75 $ 197. 55 Oct $ 200. 20 $ 2. 75 $ 197. 45 Nov $ 201. 30 $ 2. 75 $ 198. 55 Dec $ 203. 30 $ 2. 75 $ 200. 55 Jan $ 202. 20 $ 2. 75 $ 199. 45 Feb $ 201. 30 $ 2. 75 $ 198. 55 Mar $ 200. 30 $ 2. 75 $ 197. 55 Apr $ 203. 20 $ 2. 75 $ 200. 45 May $ 200. 10 $ 2. 75 $ 197. 35 June $ 203. 50 $ 2. 75 $ 200. 75 $ 2, 416. 00 $ 33. 00 $ 2, 383. 00 Total Charges $ 2, 416. 00 Ineligible Charges $ 33. 00 $ Eligible Charges E-rate Discount E-rate Reimb. 2, 383. 00 65% $ 1, 548. 95 9

FY 2011 (YEAR 14) For services rendered 7/1/2011 - 6/30/2012 74% of PA Priority 1 FRNs funded as of 10/26/2011 P 2 funding at 90% Likely to go lower File the 486 after FCDL arrives List of near 486 due dates sent to listserve last week Many due by October 28 If you don’t file, USAC will send you a 486 Late Notice, and give you a few additional days to file Request discounted bills from vendors, if desired FY 2011 cap increased to $2. 29 billion due to inflation 10

FY 2011 IF YOU HAVEN’T BEEN FUNDED For the 26% of applicants haven’t yet been funded, it’s likely due to one of these four causes: 1. 2. 3. 4. Polluted Form 471 (mixing P 1/P 2 on same 471) Certain vendor listed on your 471 PIA reviewer left USAC Funding increase requested and caught in USAC limbo (more later) What should you do? 1. 2. 3. 4. Consider possibly cancelling P 2 FRN(s) Be patient, issues being resolved contact PIA Regional Manager – Ruchi Patel at rrpatel@sl. universalservice. org – and ask if she will have your 471 assigned to another reviewer If you don’t care about the funding increase, contact your reviewer and ask that they process application as it was submitted 11

FY 2012 (YEAR 15) For services rendered 7/1/2012 - 6/30/2013 471 application window will likely open first week in January and close mid/late March (my guess 1/5 – 3/15) § Reason? Trying to wrap up FYP 1 FCDLs before FY 2012 begins Form 470’s being accepted now! § Don’t wait until Jan/Feb to file, especially if you need to take contracts to your board New 470 removes many of the unused features and questions MTM/contract/multi-year contract checkboxes BEAR/SPI preference question Ineligible entities section Necessary resources checkboxes Area codes and phone pre-fixes section Must list disqualification reasons on 470 in Item 13 or in RFP 12

Don’t forget: You must post a 470 for every service, every year, unless. . . You are in a multi-year contract that was originally competitively bid using a Form 470 OR If you are purchasing P 2 equipment from the PEPPM contract (PEPPM was already competitively bid on behalf of all schools and libraries) 13

ELIGIBLE SERVICES LIST 2012 ESL approved by FCC; No meaningful changes, just wordsmithing Reminders from FY 2011 § Lit and Dark Fiber § Can be provided by a non-telco § Dark fiber installation only eligible from school building to property line § Dark fiber must be leased, and lit by the applicant § VOIP § Handsets never eligible, even if leased § Gateway can be bundled with MRC § Basic Maintenance – Eligible No-cost bundled manufacturer warranties up to 3 years Software, patches, online tech support (such as Ciscobase) Reimbursements for actual labor and break-fix cost Basic Maintenance – Not Eligible Unbundled warranties, insurance-type warranties, including Smartnet 14

NEW CIPA REQUIREMENTS New CIPA requirements become effective 7/1/2012 Requires schools’ (not libraries) Internet Safety Policies include ". . . educating minors about appropriate online behavior, including interacting with other individuals on social networking websites and in chat rooms and cyberbullying awareness and response. " This means that schools are required to teach online safety to students as a prerequisite to receiving E-rate funding Local boards decide frequency and delivery of online safety/cyberbullying education Can’t be once every 4 years Establish policy, follow policy and document implementation 15

CIPA DOCUMENTATION Notice of public hearing or public meeting (such as school board meeting) where CIPA policy was considered and voted upon § Agenda for meeting – show opportunity for public input/comment before adoption of CIPA policy § Other documentation for opportunity for public comment Filtering records, purchase order Documentation of cyberbullying/appropriate online behavior education for all minors § Curriculum, when taught, to whom, etc. . . 16

NEW SPIN CHANGE RULES Can no longer switch vendors because of lower price Some vendors were abusing lax SPIN change rules and not bothering to participate in 470 bidding process Legitimate reasons include: breach of contract service provider is unable to provide quality service bankruptcy delayed provision of service Must select vendor that received the next highest point value in the original bid evaluation, assuming there was more than one bidder If no other bidders, then you may select any cost effective vendor Tell your business office! 17

SHOULD I APPLY FOR P 2 FUNDING? Year 1 -- funded to 70% Year 2 – all funded Year 3 – down to 82% Year 4 – down to 87% Year 5 – down to 81% Year 6 – down to 70% - significant rollover funds Year 7 – down to 81% Year 8 – down to 80% Year 9 – down to 86% Year 10 – down to 81% - $650 M rollover Year 11 – down to 87% - $600 M rollover FY 2009 – down to 77% - $900 M rollover FY 2010 -- all funded - $1. 15 B rollover + inflation 18

APPLICANTS CANNOT. . . Have a relationship with service providers that would unfairly influence the outcome of the competition Furnish service providers with inside competitive information Provide information or grant meetings to only some bidders Violate new gifts rules 19

APPLICANTS CAN. . . § Have pre-bidding discussions with potential bidders as long as that doesn’t lead to one bidder having “inside” information § Attend product demonstrations § Encourage and seek vendors to bid § Do research to determine what cost-effective solutions are available 20

SERVICE PROVIDERS CAN. . . Offer neutral technical assistance on development of technology plan Cannot exert undue influence on applicant's ability to conduct a fair and open competitive bidding Answer general questions about the products and services they sell in response to applicant inquiries Assist with Form 471 Item 21 attachment Provide information to applicants to assist with responding to PIA questions but applicant must respond to PIA Provide assistance with service substitutions and other postcommitment activities but applicant must certify 21

SERVICE PROVIDERS CANNOT. . . Help prepare Form 470 Help write or provide RFP to applicant Be a contact person on Form 470 Sign any applicant forms Be involved with bid evaluation in any way Provide funding for the applicant's non-discount portion or waive the applicant's non-discount portion Coerce or pressure the applicant to use a specific service provider Note to vendors on this webinar. . Provide gifts to applicants that violate the gift restrictions 22

GIFT RESTRICTIONS All gifts from service providers to applicants are prohibited except for: Modest refreshments that are not offered as part of meal (e. g. , coffee and donuts provided at a meeting) and items with little intrinsic value intended for presentation (e. g. , certificates and plaques); Items that are worth $20 or less (e. g. , pencils, pens, hats, t-shirts, and other items worth less than $20, including meals), as long as those items do not exceed $50 per employee from any one source per funding year Charitable contributions in support of schools, including, for example, literacy programs, scholarships, as long as such contributions are not directly or indirectly related to E-rate procurement activities or decisions Personal gifts to family and personal friends when those gifts are made using personal funds of the donor (without reimbursement from an employer) and are not related to a business transaction or business relationship 23

WHO IS SUBJECT TO GIFT RESTRICTIONS? Service providers All service providers with current or possible future Erate relationship to applicant Includes: All employees, officers, representatives, agents, or independent contractors of service providers; and All individuals who are on the governing boards of such a service provider (such as members of the board of directors) 24

WHO IS SUBJECT TO GIFT RESTRICTIONS? Applicants All individuals who are on the governing boards of such entities (such as members of a school committee) All employees, officers, representatives, agents, consultants or independent contractors of such entities involved on behalf of such school, library, or consortium with E-rate Individuals whose work in any way relates to E-rate forms and technology plans; Individuals who prepare bids, communicate or work with E-rate service providers, E-rate consultants, or with USAC; and Any staff of such entities responsible for monitoring compliance with the E-rate Program 25

OTHER IMPORTANT DETAILS RE GIFTS Aggregate value of all gifts to a single applicant employee, from a vendor (company) is considered when computing the $50 annual limit Example: Comcast as a company can’t give more than $50/year to a single school employee, in no larger than $20 increments Rules are always applicable, not just during the time period when the competitive bidding process is taking place 26

OTHER THINGS TO REMEMBER Contract extensions: § If you sign a contract with optional extensions, be sure the contract lists what the price will be during those extensions. § Either exact price, or current contract price adjusted for current CPI § A note to the vendors on this webinar. . . Bid evaluations must be performed, with price of eligible services receiving the heaviest weight § Can consider many other factors. Examples: § History with vendor § Cost of ineligible items § New vendors’ cell phones § § MBE/WBE preference Quality of proposed solution Cost of staff time required to switch vendor In-state preference 27

MULIT-TIERED EVALUATIONS Multi-tiered bid evaluations (BAFOs) ok: § If you use a multi-tiered or multi-round evaluation process, the price of the eligible services ultimately must be the primary evaluation factor in selecting the winning bid. § Technical capabilities, such as scope or quality of service, may form the basis for conducting the first round of bid evaluations. This tier may be evaluated on a pass/fail basis or scored numerically where a maximum score is required to advance to the next tier of the evaluation process. 28

MINISTERIAL AND CLERICAL ERRORS In previous years, applicants could make almost ANY change to a 471 during the 15 -day RAL Correction Period This summer, the FCC issued an appeal which stated: “The applicant can amend its forms to correct clerical and ministerial errors on their FCC Forms 470, FCC Form 471 applications, or associated documentation until an FCDL is issued. Such errors include only the kinds of errors that a typist might make when entering data from one list to another, such as mistyping a number, using the wrong name or phone number, failing to enter an item from the source list onto the application, or making an arithmetic error. ”(FCC 11 -60) USAC revised their procedures to be extremely conservative, making nearly all corrections invalid States pushed back, met with the FCC, and those procedures were pulled New PIA procedures being developed to better match FCC’s intent Affected applications in limbo as a result 29

M/C ERROR EXAMPLES Using wrong FCC Form 470 number, wrong billed entity number, or wrong billed entity number/worksheet number on Form 471 Using wrong name or service provider identification number (SPIN) Using wrong expiration date for a contract Inaccurately reporting the prediscount amount on Block 5 Leaving off a building from Block 4 Listing wrong service category in Block 5 Simple addition, subtraction, multiplication or division errors Failing to enter an item from the source list (e. g. , NSLP data, uploading Block 4 data, FRN, etc. ) 30

REQUESTING A M&C CORRECTION PIA will ask if this is a ministerial or clerical error § Explain how the error occurred § Provide a reasonable explanation § Provide documentation that was in existence as of the date of submission of Form 470 or Form 471 Explain that the error occurred when consulting “source list” PIA must approve the explanation before the change will be made 31

EXAMPLES OF SOURCE DOCUMENTATION Contract, Service Agreement Vendor quote, bill, invoice, etc. RFP, Newspaper listing NSLP documentation or student enrollment data Board Minutes, Resolutions Budget Any other documentation in existence as of date of submission of Form 470 or Form 471 to prove error was ministerial/clerical 32

ARE YOU IN LIMBO DUE TO M/C? If you requested an increase to your funding request, or PIA noticed that you were eligible for an increase, your application is likely being held while new procedures are being developed If you would rather have your FCDL now than wait for the increase to be approved (denied), you can contact your original PIA reviewer and ask them to process your application as it was submitted and forgo the increase § If your original reviewer has left, e-mail Ruchi Patel at rrpatel@sl. universalservice. org 33

PEPPM If using the PEPPM contract for FY 2012, you may skip the 470 process But you must contact the PEPPM-awarded vendor for a price quote before you submit your Form 471 Quote must be on vendor letterhead with date PIA will ask for this during their review 34

FILTERING FCC acknowledged that current rules may not address the filtering requirements when personal computers and devices are brought to school But they have verbally stated that any school-owned computer/device must be filtered, whether it is used on campus or off When the FCC requests public comment, I encourage you to participate As of now, no exceptions for cellular devices 35

WHERE CAN I LOOK FOR INFORMATION? www. e-ratecentral. com/us/state. Information. asp? state=PA Enter your E-rate Billed Entity Number in upper left corner Website shows § § All FRNs Every Funding Year What Has Been Filed What Has Been Committed and Disbursed Need help? E-mail Julie at jtschell@comcast. net 36

QUESTIONS? 37