The Federal Communications Commission Dec. 30 released a long-awaited reconsideration
The Federal Communications Commission Dec. 30 released a long-awaited reconsideration order, addressing a number of issues that it said needed to be resolved before the E-rate program could take effect in the new year.
While the order formally ratifies a number of policy decisions already reflected in the policies of the Schools and Libraries Corporation and application forms recently distributed by the FCC, the so-called Fourth Order on Reconsideration established these new rules for the program:
Treatment of Existing Contracts: The FCC specified that any contract signed on or before July 10, 1997 will be considered an existing contract and not subject to competitive bidding for the life of the contract. Contracts signed after July 10, 1997 and before the SLC's Web site becomes operational will be considered existing contracts for those services provided through Dec. 31, 1998. The FCC rejected a request that it eliminate all restrictions on contracts signed before the Website becomes operational.
Wide Area Networks: To the extent that states, schools or libraries build and purchase wide area networks to provide telecommunications, the FCC said the cost of purchasing such networks will not be eligible for universal service discounts. However, the FCC said that connections between multiple instructional buildings that comprise a single school or library would not be considered part of a wide area network, but would instead be considered internal connections, Connections between multiple separate schools, however, would not constitute internal connections and would instead be considered part of a wide area network.
The FCC established a "rebuttable presumption" that a connection does not constitute an internal connection if it crosses a public right of way. But the FCC said its definition does not preclude schools and libraries from receiving universal service discounts on a WAN run over leased telephone lines because such an arrangement constitutes a telecommunications service.
Internal connections: The order limits support for internal connections to those essential to providing connections within instructional buildings. "Thus, discounts are not available for internal connections in non-instructional buildings of a school district or administrative buildings of a library unless those internal connections are essential for the effective transport of information to an instructional building or library. Hence, discounts would be available for routers and hubs in a school district office if individual schools in the school district were connected to the Internet through the district office." In addition, the FCC said, " ‘internal connections' include connections between or among multiple instructional buildings that comprise a single school campus or multiple non-administrative buildings that comprise a single library branch, but do not include connections that extend beyond that single school campus or library branch.
Master Contracts: Schools and libraries will be allowed to purchase services from a master contract negotiated by a third party. However, the third party initiating the master contract must either comply with the competitive bid requirement or qualify for an existing contract exemption. And even if a school or library is obligated to purchase services from a master contract, the third party must comply with these rules. The date of execution of a master contract will determine how it will be treated under the "existing contract" rules.
Statewide Networks: State telecommunications networks that procure supported telecommunications and make them available to schools and libraries constitute consortia that will be permitted to secure discounts on such telecommunications on behalf of eligible schools and libraries. . . With respect to Internet access and internal connections, state telecommunications networks may either secure discounts on such telecommunications on behalf of schools and libraries, or receive direct reimbursement from the universal service support mechanisms. . .for providing such services. . . .To the extent schools and libraries build and purchase wide area networks to provide telecommunications, such networks will not be eligible for universal service discounts."
The FCC noted that even when a state operates a network, it may be advantageous for schools and libraries to seek competitive bids themselves.
The FCC agreed with the U.S. Telephone Association that state telecommunications networks could not receive direct reimbursement from the support mechanisms because they do not offer telecommunications "for a fee directly to the public."