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USAC Reports on Anticipated Rollover for 2004

The Universal Service Administrative Company (USAC), in its quarterly report to the Federal Communications Commission, said that it will be able to roll over approximately $150 million in unused E-rate funds from the 2001 funding year to the 2004 funding year, thus increasing the amount that the Schools and Libraries Division will be able to disburse for the coming funding year to at least $2.4 billion.

USAC previously had rolled over $420 million in undisbursed commitments for the 2003 funding year, which enabled the SLD to approve internal connections for applicants with a discount rate as low as 70 percent. In recent years, the FCC has authorized the SLD to commit an even higher amount, recognizing that applicants historically did not use all the funds that were approved for their use.

Additionally, USAC reported that for the 2002 funding year it will continue to retain close to $830 million, $450 million for "potential additional disbursements on committed FRNs" and $380 million to cover "pending appeals and invoice deadline extension requests." Because the FCC recently gave several large applicants an opportunity to re-file their 2002 funding year applications (Ysleta Order), USAC states that it will be cautious and "assume that all commitments still available for disbursements will be fully disbursed, to assure that sufficient funds remain available."

USAC said that the SLD's budget for the third quarter of 2004 will increase by close to $700,000 to cover ongoing administrative expenses and new initiatives, including 1,000 site visits per year "to enhance program integrity." The SLD will add one person to manage and support the site visit initiative, three auditors to support this initiative, and an "ombudsman" for the program.


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