Resuming our analysis of the specific changes to the E-rate program through the FCC Sixth Report and Order, we continue by providing an analysis of the Operational SPIN Changes.

The topic of Operational SPIN Changes is addressed in the Sixth Report and Order under Section C: Improving Safeguards Against Waste, Fraud and Abuse. The premise behind this topic is to better clarify when an Operational SPIN Change is permissible following the competitive bidding process and to disallow service providers the opportunity to bypass the whole procedure.

Certain practices and conduct have been deemed inappropriate and go against the intended nature of holding a fair and open competitive bidding process. Identified examples are service providers who contact applicants after they have properly navigated the bidding process and established a proper contract. They proceed to offer the applicant new lower priced products and services and reference the SPIN Change method to switch vendors. Other practices involve applicants selecting a winning bidder but never intending to initiate services and switch vendors once a funding commitment is granted.

In order to safeguard the intended use of the SPIN Change, the FCC has made two clarifying statements as to when a SPIN Change is permissible once a competitively bid contract is signed and in place. An applicant may not change to a different provider unless (1) there is a legitimate reason (i.e. breach of contract or the service provider is unable to perform); and (2) the newly selected vendor was the runner-up or received the next highest point total when the services were originally competitively bid and evaluated, assuming multiple bids were originally received.

Applicants must still wait until a funding commitment has been issued on their requests before submitting an Operational SPIN Change. Upon receipt, USAC will continue to review for program compliance and look to identify any practice which may go against the competitive bidding process.

Funds For Learning is your leading source for news and analysis of the FCC Sixth Report and Order. Continue to check our FCC E-rate Broadband Order page for the latest updates and further analysis of the Orders and the implications on the E-rate program. If you have any questions about the Orders please call 405-341-4140 or email us at info@fundsforlearning.com.