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USAC Says It Expects to Begin Issuing Funding Commitments by Late November

The Universal Service Administrative Company formally announced Oct. 12 that it expects to be able to issue "some funding commitments" in the E-rate and Rural Health Care programs "by late November." The announcement marked the first official word from USAC on when funding commitments might resume since they were halted in early August.

In a statement, USAC said, "We are doing all we can to be able to act sooner. USAC is working very closely with the FCC to resolve issues as quickly as possible, including the priority of commitments to be issued as we become able to issue" new funding commitment letters.

At the time commitments were halted, the Schools and Libraries Division still had about $440 million worth of unresolved funding requests still pending from the 2003 funding year. Before commitments were put on hold, the SLD had approved about $742 million in funding requests for the 2004 funding year. Its application reviewers have continued to fill the pipeline in the meantime.

The hold-up in new funding commitments occurred because the Federal Communications Commission required USAC to convert its accounting systems to the federal government's accounting standards by October 1. Under those rules, USAC was required to start treating approved commitments as obligations, rather than when an invoice was presented for payment. Under the new accounting rules, USAC must actually have the money in hand before it can issue a commitment.

USAC noted that it has sufficient funds in hand to cover all the funding commitments it has previously issued, and since August, it has continued to disburse funds on previously approved funding commitments. USAC's ability to issue new funding commitments will depend on the pace of continued Universal Service Fund collections, as well as when old funding commitments expire when applicants did not use them. October 28 marks the date by which applicants and their service providers are expected to submit service provider invoices or Billed Entity Applicant Reimbursement forms associated with recurring services in the 2003 funding year. January 28, 2005 is the deadline for payment paperwork associated with non-recurring services that had to be used by September 30, 2004.

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