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Caution: Experience and Risk

In August 2014, the Federal Communications Commission (FCC) released an Order denying an appeal from the Yakutat School District in Alaska for their FY 2011 funding requests totaling $111,000. The District’s long time administrator who handled E-rate had retired, and the District hired a business manager to handle all the E-rate work, among other things. In short time, the District went from an abundance of E-rate experience to a completely fresh start, limiting their chances for a successful application.

Unfortunately, this led to the District missing the FY 2011 application filing window – by only 18 days. Both USAC and the FCC have now denied appeals from the district. Administrators and educators who handle E-rate work often have many responsibilities, but the many E-rate deadlines are critical. According to the appeal filed by the Yakutat School District the E-rate funds were approximate 5% of the entire school budget.

The FCC decision explains that:

We are sympathetic to the challenges faced by applicants in complying with the administrative requirements of the E-rate program… [however] we recognize the importance to all applicants of effective and efficient administration of the E-rate program, and consistency in enforcing the deadline for filing E-rate applications is essential to the efficient operation of the program…”  The FCC further stated that “…if ordinary difficulties associated with filing an FCC Form 471 were grounds for a waiver, waiver could be warranted for every conceivable violation of the filing deadline. We also find that Yakutat’s financial hardship argument fails to justify a waiver of our rules. We have consistently held that the assertion of financial need of the applicant and the detrimental impact a denial of support will have on the students who make use of the services does not meet the requirement of special circumstances that warrant a waiver of the Commission’s rules…”

USAC will announce the filing dates for FY 2015 soon, but indications are that the window will open in early January and close mid-to-late March. The FY 2015 Form 470 and the FY 2015 Eligible Services List were only recently approved, and applicants will start the competitive bidding and E-rate procurement season in earnest over the coming weeks.

This should serve as a reminder to applicants to start the procurement process soon, as applicants must wait through the 28 day Form 470 bidding period before selecting a provider. Applicants that also release an RFP must have it available for 28 concurrent days with the Form 470.  Time will be required to evaluate bids, negotiate contracts and possibly receive school board approval – all before the Form 471 is submitted. With new requirements for the embedded Item 21, survey questions and new discount calculations, applicants will also need ample time to complete the new Form 471.

With the Yakutat appeal decision, the FCC is warning applicants that “ordinary difficulties” associated with the E-rate application process will most likely not be grounds for granting appeals. If you are new to E-rate, or have been doing E-rate for many years but have heartburn about learning all the new rules and regulations tied to E-rate 2.0, please contact Funds For Learning to request a quote for our E-rate compliance and consulting services.

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