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E-Rate 101:
Overview of the Program
Training for Success
Schools and Libraries Division
Washington, DC • Orlando • Boston • New Orleans • Cleveland • San Francisco • Phoenix
September/October 2007
www.usac.org
Overview
Eligibility
Eligible services
Technology planning
Requesting services (Form 470)
Discounts
Ordering services (Form 471)
PIA Review and commitments
Confirming services (Form 486)
Invoicing (Form 472 or Form 474)
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Funding Timetable
Funding commitments are made by funding
year (July 1 – June 30)
– Recurring services received July 1 – June 30
(12 months)
– Non-recurring services delivered and installed
July 1 – September 30 (15 months)
The Window: Form 471 filing window (mid-
November to early February before the
start of the funding year)
We encourage you to file online
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Applicant Eligibility
To be eligible, a school:
– Must meet the statutory definition of an
elementary or a secondary school in the
No Child Left Behind Act of 2001
– Must not be operating as a for-profit
business
– Must not have an endowment exceeding
$50 million
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Applicant Eligibility
To be eligible, a library:
– Must be eligible for assistance from a
State library administrative agency
under the Library Services and
Technology Act
– Must not be operating as a for-profit
business
– Budget must be completely separate
from any schools
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Applicant Eligibility
Consortia
– Can include both eligible and ineligible
entities
– Only eligible entities can receive
discounts
– Consortium leader has record-keeping
and administrative responsibilities
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Service Provider Eligibility
Form 498 (contact information)
– Request a Service Provider
Identification Number (SPIN)
– Provide/update contact information
Form 473 (annual certification)
– Must be filed for each funding year
before USAC will pay invoices
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Service Provider Eligibility
Telecommunications Carriers
Must provide telecommunications services
on a common carriage basis
Must file Form 499A every year and may
be required to contribute to the Universal
Service Fund
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Eligible Services
Four categories of eligible services
Priority 1 (funded first)
– Telecommunications Services
– Internet Access
Priority 2 (funded beginning with neediest
applicants first)
– Internal Connections
– Basic Maintenance of Internal Connections
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Eligible Services
Priority 1
– Telecommunications Services
• Local and long distance, wireline and
wireless, voice/data/video
– Internet Access
• Basic conduit access to the Internet
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Eligible Services
Priority 2
– Internal Connections
(switches, hubs,
routers, wiring, cabling)
• Internal Connections funded
only 2 in 5 funding years
– Basic Maintenance of Internal Connections
NOTE: End user equipment - such as
computers, monitors, or phone sets - is NOT
eligible
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Technology Plan
Applicants must develop a technology plan
– Use telecommunications services and
information technology to achieve
educational goals and/or library
improvements
A plan IS required for discounts on any
products or services other than “Basic
Telephone Service” and voice mail.
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Technology Planning
Must contain five elements:
– Goals/Strategies for using technology
– Professional development
– Needs assessment
– Evaluation process
– Sufficient budget
Make sure your technology plan is
written at the time the Form 470 is filed
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Technology Planning
Must be written before Form 470 is filed
Must cover all 12 months of the funding year
Should not cover more than 3 years
Must be approved by a USAC-certified
Technology Plan Approver (TPA) by the start
of services or the filing of Form 486,
whichever is earlier
Service providers should not be involved in
the creation of the technology plan and
should not act as the technology plan
approver
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Form 470
Form 470 – Services Requested
Filed by applicants to define desired services
and open the competitive bidding process
Must be posted on the USAC website for at least
28 days before selecting service provider and/or
signing a contract
Form 470 request must be based on the
technology plan
Applicants can also issue a Request For
Proposal (RFP), which must also be available for
at least 28 days
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Form 470
Multi-year or annual posting
Can be filed once for multi-year contracts or
contracts with voluntary extensions, but Form
470 and RFP must indicate intent
Tariffed or month-to-month services must
post Form 470 annually
Service providers are prohibited from filing
and signing Form 470 or representing
applicant in bidding process
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Form 470
Competitive Bidding
– The applicant must conduct a fair and open
bidding process
• All bidders are treated the same
• All bidders have equal access to information
• All bidders know what is required of them
– The applicant must choose the most cost-
effective offering with the price of eligible
products and services being primary
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Receipt Notification Letter
Receipt Notification Letter (RNL)
Issued by USAC after Form 470 is posted
Provides important information
– Allowable Vendor Selection/Contract
Date (28 days after posting)
Offers opportunity to make allowable
corrections
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Discounts
Schools and libraries can receive
discounts on eligible services.
Discounts range from 20% - 90% on
eligible products and services
Discounts are based on:
– Percentage of students eligible for the
National School Lunch Program (NSLP)
– Urban or rural location of school or library
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Discounts
Discount Matrix
Percent of Urban Rural
Eligible Students
Less than 1% 20% 25%
1% - 19% 40% 50%
20% - 34% 50% 60%
35% - 49% 60% 70%
50% -74% 80% 80%
75% -100% 90% 90%
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Discounts
Calculating Discount Methods
– Primary measure: NSLP
– Alternative discount mechanisms
Shared Discounts
– School districts use the weighted average of
the discounts of individual schools in the
school district
– Libraries use the simple average discount of
the school district in which they are located
– Consortia use the simple average of the
consortium members
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Contracts
Applicants must sign and date contracts before
the Form 471 is certified
– Date can be written in contract
Contracts can cover more than one year or
contain extensions, but these options must be
indicated in the establishing Form 470
Tariffed and month-to-month services do not
require a contract, but they are considered
contracted services if a contract is signed
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Form 471
Form 471 – Services Ordered
Contains specific information on services
ordered, quantities, from whom, at what price
Shows discount rate calculation and lists
entities receiving services
Applicant certifies compliance with rules and
verifies that it has the necessary resources to
make effective use of the discounted services
Must be filed each year within the filing
window
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Form 471
Service providers are encouraged to:
– Provide guidance to the applicant on its
services and functionality
– Assist with providing information for the Item
21 attachment and other information
Service provider should always provide correct
SPIN and contact information
Service providers should avoid any involvement
in the bidding process except as bidders and
should not answer any questions regarding the
bidding process.
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Receipt
Acknowledgment Letter (RAL)
Issued by USAC to applicants and service
providers after Form 471 is certified
Confirms the filing of the Form 471 and
provides the details of the funding requests
Offers an opportunity to make allowable
corrections
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PIA Review
Program Integrity Assurance (PIA) checks for
compliance with program rules, eligibility of
entities and services, verification of service
types/costs
– Provide complete and prompt responses to
PIA’s questions
– Ask for clarification if you don’t understand
– Service providers can assist applicants in
responding to PIA questions about the
products and services they are providing but
not about other areas.
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Funding Commitments
USAC issues Funding Commitment Decision Letter
(FCDL) to applicants and service providers when
PIA review is complete
Funding status by Funding Request Number (FRN):
– Funded (includes modifications)
– Not funded
– As yet unfunded (applicant FCDL only)
– Canceled
Funds approved for specific services from specific
service providers at the applicant’s approved
discount rate
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Form 486
Form 486 – Services Confirmed
Notifies USAC that services have started
and invoices can be paid
Applicant certifies that its technology plan
meets program requirements
Applicant certifies its status under
Children’s Internet Protection Act (CIPA)
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Form 486
Form 486
Filed online or postmarked no later than
– 120 days after the Service Start Date or
– 120 days after the date of the FCDL,
whichever is later
There may be a penalty for filing late
Service Start Date
– Cannot be before July 1 of the funding
year
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Invoicing
Form 472 or 474 – Services Invoiced
Requests reimbursement from USAC for
discount on cost of services delivered
Filed online or postmarked no later than
– 120 days after the last date to receive
service or
– 120 days after the date of the Form 486
Notification Letter, whichever is later
Two options for requesting reimbursement
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Invoicing
Form 472
Billed Entity Applicant Reimbursement
(BEAR) Form
– Filed if applicant PAID for services in full
– Reimbursement handled through service
provider
– Cash or credit reimbursement
– Service provider must reimburse applicant
within 20 days of receipt of funds
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Invoicing
Form 474
Service Provider Invoice (SPI) Form
– Filed by service provider
– Applicant gets discounted bills
– Submitted AFTER applicant has
received service and been billed by
service provider
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