On May 20, 2010, The FCC released a Notice of Proposed Rule Making (NPRM) seeking comment on a myriad of proposed rules to the E-rate program in order to streamline the process and expand broadband access to schools and libraries across the country. While most respondents were in favor of streamlining the application process and simplifying the required elements of the procurement process, the ambiguity of the FCC proposals, especially in regards to the proposed procurement regulations, posed more questions than answers. (For detailed synopses of the proposed changes, please see Funds For Learning’s summaries of Application Simplification, Broadband Expansion and Equipment Disposal.) The NPRM comments, along with the draft Eligible Services List (ESL) comments, were due on July 9, and hundreds of E-rate stakeholders, including Funds For Learning, commented on the two items*. Upon review of the NPRM comments, E-rate stakeholders were overwhelmingly in support of streamlining the application process and increasing the funding cap. However, the proposed methods revealed in the comments to reach those goals varied in size and scope from minute changes to the Form 470, to completely eliminating the Schools and Libraries Division’s oversight in the procurement process. The vast majority of responses addressed the proposed changes to the application process, including the current Form 470 and technology plan requirements. The FCC proposed the elimination of the Form 470 and technology plan requirements for priority one services, instead allowing state and local procurement laws to dictate competitive bidding requirements. Most comments were in favor of streamlining the process by having the SLD surrender its authority on procurement oversight in favor of greater state authority. However, the elimination of these requirements and the seemingly ambiguous regulations that may result, lead to more questions from the responders. The E-rate Service Providers Association (ESPA) summed up the potential confusion of eliminating the priority one requirements in their comments by stating: “All Priority 1 services are not created equal. It is feasible that applicants who are only requesting basic phone connectivity and internet access up to a certain speed could be relieved of the requirement for a technology plan. However, any application that includes complex services including WAN, hosted VOIP, etc should have a plan that identifies the intention and cost of implementation for the solution.” ESPA went on to say, “[T]he Form 470 itself is not the problem. The procedures surrounding the Form 470 and associated administration of rules are what creates [sic] the challenges.” Another issue featured prominently in the comments was the potential change to the calculation used to determine the discount percentage rate and discount matrix. This was a popular suggestion and received support from nearly all of the received comments, however there was great variation of comments suggesting how to institute the changes to facilitate the streamlining of the E-rate process. One issue that was praised in nearly all of the comments reviewed was a desire to increase the annual funding cap and index the cap to inflation. The NPRM discussed adjusting the total amount available for the E-rate program to inflation so that the program retains its purchasing power in current dollars. The idea being that by increasing the current funding cap would allow more schools to benefit from the E-rate program with respect to priority two services. Although respondents seemed in favor of streamlining the application process and simplifying the required elements of the procurement process, there were examples of comments expressing confusion from the ambiguity of the proposed changes. Respondents seemed wary of fully adopting the proposed changes unless the FCC can prescribe clear and concise guidance. While the deadline for comments has passed, there is an opportunity to reply to these comments. You may submit reply comments until the 26th of July. Reply comments can be submitted here. Any responses will need to reference CC Docket No. 02-6.

  • FFL Comments on the NPRM can be found here.
  • FFL Comments on the ESL can be found here.