The Schools and Libraries Division Sept. 1 issued details of the procedures that it said E-rate applicants and service providers must follow if they want to change the product or service that the applicant intends to purchase with approved
The Schools and Libraries Division Sept. 1 issued details of the procedures that it said E-rate applicants and service providers must follow if they want to change the product or service that the applicant intends to purchase with approved E-rate support.
This situation typically arises when a service provider stops offering a particular product or makes available a newer, faster, more powerful product that costs the same or less than the product that was originally specified. This kind of situation was not unusual, considering the lag time between when an applicant might post a Form 470 application and when it would actually purchase the products-a time period that could easily stretch to more than a year. With no clear guidance from the SLD on this process until now, many applicants undoubtedly went ahead and worked out the product switches with their vendors on an informal basis.
The procedure is only used when the applicant wants to purchase a new product from the same vendor, not when it needs to change the vendor that was specified on its application.
The new procedure makes use of the Minor Contract Modification (Block 2) section of the Form 471 application. The SLD said it would permit service and product changes when a product or service is no longer available and a substituted product would perform the same function. Such changes will also be permitted when an upgraded product or service becomes available and performs the same functions in an improved fashion (that is, it operates at higher speeds or is easier to use).
In all instances, the SLD said, the substitution will only be permitted if it will not increase the price of the products; the switch is in accordance with state and local procurement laws and the terms of the original contract; and the new product does not have a higher percentage of costs associated with ineligible services.
The SLD said service providers will be required to submit a list of products and/or services that their eligible customers wish to change or upgrade, indicating the product, manufacturer, model and cost of the original item and the proposed substitution. Providers were instructed to contact Louis J. Tiboldo, the SLD's manager of products and services, at 973-884-8016 if they wish to submit a substitution.
Once the proposed change has been reviewed, Tiboldo will provide a letter detailing whether the change has been approved or denied.
Then applicants should submit a supplemental Form 471 application with Block 2, Item 7 checked, indicating that this is a minor contract modification for a previously filed Form 471. The applicant must complete Blocks 1, 2 and 6, and provide a list of all of the Funding Request Numbers that are involved in the proposed change. In addition, a copy of the company's approval letter from Tibaldo must be attached.
The SLD said that when the new products cost less, the applicant would not be able to use the freed-up money to purchase additional products and services or to increase the number of products it could purchase. The SLD recommended that applicants complete a Form 500 to notify the SLD that these funds have been freed up, so that they could possibly be applied to another applicant.