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SLD Board Critical of SPIN Change Process

Members of the Schools and Libraries Committee of the Universal Service Administrative Company Board of Directors October 20 expressed skepticism about procedures mandated by the Federal Communications Commission for reviewing requests from applicants to change their service providers.

Since the FCC's so called Copan decision was issued in 2000, applicants seeking a SPIN change are required only to certify that they have notified their original service provider, that they can get out of their contract and that the change of vendors is permissible under state and local procurement rules.

USAC Board member Robert Rivera said he had heard from a service provider who had described how a group of employees had set up their own company and had easily transferred an existing E-rate customer to the new company. Rivera contended that some schools put down the name of the company that won the competitive bidding process, "then six months later do a SPIN change for the vendor they really wanted."

SLD head George McDonald replied that "the Commission has been pretty clear" about what it wants the SLD to do. "I'm not arguing the merits, but the FCC was pretty specific."

USAC Board chair Frank Gumper replied, "I can understand where they don't want to get involved" in contract disputes. "But we have denied applications on the basis of failure to meet state and local procurement rules." Gumper questioned why the SLD would not review a situation more closely if "someone says it's in violation of the rules."

Board Chair Brian Talbott said, "It seems far too easy for someone to get around the competitive bidding situation." Other board members echoed that viewpoint, calling the current policy "absurd."

USAC CEO Cheryl Parrino offered to take specific examples to the FCC to try to explain the issues involved and see if the position would be reconsidered.

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