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GAO Recommends Flexibility on Anti-Deficiency Act

The Government Accountability Office April 11 recommended to a Senate committee that the Federal Communications Commission be given some flexibility in bringing Universal Service Fund programs under the requirements of the Anti-Deficiency Act.

The Senate Commerce, Science and Transportation Committee called the hearing to consider legislation that would permanently exempt the program from coverage under the act. Application of the law forced the Schools and Libraries Division to hold up issuing new funding commitments last fall until the Universal Service Administrative Company had collected enough money to cover the commitments.

Patricia A. Dalton, managing director of physical infrastructure issues for the GAO, said that it agreed with the FCC’s conclusion that the Universal Service Fund was a permanent indefinite appropriation, that it was subject to the act, and that E-rate funding commitments amounted to obligations for purposes of the act. Nevertheless, the GAO recommended that Congress grant the USF a two- or three-year exemption from the law, or a more limited exemption that would provide greater management flexibility. The GAO noted that that would provide time for the National Academy of Public Administration to complete a study of the program and how it could be improved, and to report its findings to the FCC.

In his prepared testimony, Austin C. Schlick, acting general counsel of the FCC, said that as of March 17, 2005, the FCC had directed USAC not to issue funding commitments for the E-rate program in amounts that exceeded the disbursement cap that the FCC had set for the program. In recent years, the SLD was permitted to issue commitments in excess of the cap in recognition that, for a variety of reasons, schools and libraries did not use all of the funding that had been committed for them in the past. Under this policy, the SLD each year will be able to commit only $2.25 billion, plus the amount of “rollover” funding—unused funding from previous years–that the FCC has approved for its use.

The tenor of the hearing, which included the E-rate program’s two congressional sponsors, was more positive than a recent hearing by the House Energy and Commerce subcommittee on oversight and investigations. One of the program’s sponsors, Sen. Olympia Snowe, R-ME, expressed her disappointment that representatives of the Office of Management and Budget had not appeared at the hearing. She noted that USAC had been required to liquidate several million dollars worth of assets on short notice last fall in order to comply with the requirements of the Anti-Deficiency Act.

Sen. John D. Rockefeller IV, D-WV, the other original sponsor of the E-rate program, noted that a number of other federal programs, including Medicaid and the Peace Corps, had also been subject to waste, fraud and abuse, but in the case of the Peace Corps, adjustments were made in its early days that had addressed the issues involved.

Sheryl Abshire, district administrative coordinator of technology for the Calcasieu Parish Public Schools in Lake Charles, LA, appeared at the hearing on behalf of the Education and Libraries Networks Coalition and the Consortium for School Networking. In prepared remarks, she described the E-rate funding hiatus last fall as “a major catastrophe for our district,” that set back its ability to upgrade its infrastructure for anywhere from six months to a year. She urged the committee to “make sure that the program remains not just in operation but smooth running and vibrant.”

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