FY 2015 E-rate
•
•
•
•
•
•
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Funding: just how much funding is available?
Determining your discount
ESL – Reductions, Eliminations, Additions
Category 2 budgets and Wi-Fi
Contracts and SAP
Consortia and Direct Connections
Forms
Form Review Team
Form Review Team
FY 2015 Funding Cap
• $2,400,000
• $1,000,000
• $3,400,000
Cap
Internal Connections Funding
Funding available for FY15 and
FY16
• We don’t know what will happen after FY16
– Could be a continuation of the same
– Could revert back to what we were
– Could be a totally new game
Simplifying Discount Calculations
New Discount Principles
• Discounts are calculated for the organization as a whole.
• Discount rates do not change based on which entities
within a district/system are receiving service.
• Libraries derive their discount from the NSLP eligibility of
the district in which the main outlet is located.
• Consortia continue to use simple average of member
discounts.
• Rural status is determined at the district/system level and
only if more than 50% of schools or libraries are rural.
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Revised Discount Matrix
Note lower top discount rate for Category Two services.
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Simplifying Discount Calculations
School Districts
• All schools in the school district get the same discount.
– Simplifies process by not having to calculate multiple
discount rates for different groups of schools.
– When eligible, Non-Instructional Facilities (NIFs) get the
same discount as the schools in district.
– Single schools within a district never get their own
discount rate, even if they are the only school receiving
that service.
– Urban/Rural status based on all of the schools in the
district (not including NIFs).
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Simplifying Discount Calculations
Libraries and Library Systems
• Libraries get their discount based on the percentage of
student eligible for the NSLP in the school district in
which the main outlet is located.
– No longer calculate discount based on all districts in
which library system has outlets.
• Libraries calculate their own urban/rural status based on
their own outlets. Therefore, the library system’s
discount may not match the school district’s discount
rate.
– Bookmobile and kiosks count as library outlets.
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Simplifying Discount Calculations
Non-Instructional Facilities (NIFs)
• By definition, NIFs are neither schools nor libraries.
• NIFs get the discount of the school district or library
system, regardless of the entities they serve.
• NIFs with classrooms, like all other entities in the school
district or library system, get the same district-wide
discount.
• NIFs don’t get an urban/rural status
– NIFs get their discount from the district/system,
regardless of their physical location and are not
counted in the urban/rural determination.
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School District Calculations
School District Discount Example
• School District A (10 schools)
– Total student population 3,000 students
– Total students eligible for NSLP = 1,000 students
– All but one of the schools are located in urban areas,
so district = urban
– 1,000 students eligible for NSLP/3,000 students = 33%
eligible
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School District Calculations
School District Discount Example
• School District A
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Discount Calculation Exceptions
Urban or Rural; Well, which is is?
• The Census Bureau identifies two types of urban areas:
• Urbanized Areas (UAs) of 50,000 or more people;
• Urban Clusters (UCs) of at least 2,500 and less than
50,000 people.
• “Rural” encompasses all population, housing, and
territory not included within an urban area.
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Discount Calculation Exceptions
Exceptions to Discount Calculations
• Voice Services Phase Down
– All voice service (POTS, Centrex, VOIP, cellular voice,
etc.) are subject to 20 percentage point reduction per
year from your regular discount
• FY 2015 = Regular discount – 20%
• FY 2016 = Regular discount – 40% etc.
• Category Two Top Discount
– Top discount rate = 85% instead of 90%
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Advanced Discount Calculations
One School; Three Discounts
• ABC Charter High School
– Total student population = 1,000
– Total student population eligible for NSLP = 800
= 80% students eligible for NSLP
Category One Discount = 90%
Category One Discount for Voice = 70% (90 - 20)
Category Two Discount = 85%
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Pause for a moment…..
• Questions
• Ready for Eligible
Services List?
Eligible Services
Overview
• Eligible Services List (ESL)
– Category One
•
•
•
•
Broadband
Voice Services
Eliminated Services
Eligibility Limitations
– Miscellaneous
• Lit and Dark Fiber
• Pricing Transparency
– Category Two
• Internal Connections
• Eliminated Internal
Connections
• Managed Internal
Broadband Networks
• Basic Maintenance of
Internal Connections
• Bundling Order
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Eligible Services
Draft Eligible Services List
• Went from 49 pages to 6
• Focus support on Broadband
• Phase down of Voice Services
• Eliminates outdated legacy services and other former
Priority One services
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ESL – Category One
Eligible Data transmission services and Internet Access
• ATM
• Frame Relay
• Broadband over Power Lines • ISDN
• OC-1, OC-3, OC-12, OC-n
• Cable Modem
• DSL
• DS-1, DS-3
• Ethernet
• Fiber (Lit and Dark)
• MPLS
Eligible Services I Fall 2014 E-rate Program Applicant Trainings
• Satellite Services
• SMDS
• Telephone Dialup
• T-1, T-3, Fractional T-1
• Wireless Service
(e.g. microwave)
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ESL – Category One
*NEW* Eligible Voice Services Subject to Phase Down
• Centrex
• Satellite telephone service
• Circuit capacity dedicated • Shared telephone service
to providing voice service • Wireless telephone
• Interconnected VoIP
service including cellular
voice
• Local, long distance, 800
service
• POTS
– Excludes data and text
messaging
• Radio Loop
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ESL – Category One
*New* Eliminated outdated legacy services and other
former Priority One services
• Paging
• Custom calling services
• Directory assistance
charges
• Direct inward dialing
• Text messaging
• Inside wire maintenance
• 900/976 call blocking
*New* Eliminated services that do not provide
broadband
• E-mail
• Web hosting
• Voice mail
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ESL – Category One
Eligibility Limitations for Data Plans, Air Cards and Mobile
Hotspots for Portable Devices
• Support is limited to those cases where individual data
plans are the most cost-effective option for providing
internal broadband access for portable mobile devices
• Funding is considered not cost-effective when users can
already access the Internet through internal wireless
broadband networks
• Exceptions may include library bookmobiles or where
there is a very small number of students or patrons
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ESL – Category One
Eligibility Limitations for Data Plans, Air Cards and Mobile
Hotspots for Portable Devices
• Eligibility requirements:
– Must be able to demonstrate either that installing a
Wireless Local Area Network (WLAN) is not physically
possible or
– Must be able to provide a comparison of the costs to
implement an individual data plan versus WLAN solution
• “The cost comparison may be established through the competitive
bid process of seeking and comparing bids on both WLANs and
individual data plans.”
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ESL – Category Two
Eligible Internal Connections
• *NEW*Subject to the Category Two five-year budget approach
– Access points
– UPS
– Cabling
– Wireless LAN Controllers
– *NEW* Caching
– Improvements, upgrades
and software necessary
to support eligible
broadband internal
connections components
– Firewalls
– Network switches
– Routers
– Racks
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ESL – Category Two
*NEW* Formerly Eligible as Internal Connections
• The following are no longer eligible for E-rate
support:
o Circuit Cards/Components o Storage Devices
o Interfaces
o Telephone Components
o Gateways
o Video Components
o Antennas
o Voice over IP components
o Servers
o Video over IP components
o Software
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ESL – Category Two
*NEW* Managed Internal Broadband Services (e.g. Managed
Wi-Fi)
• Subject to the Category Two five-year budget approach
• Services provided by a third party
– Operation
– Management
– And/or monitoring of eligible broadband internal
connection components
• The third party may manage the school or library’s
equipment or provide the equipment as part of a lease
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ESL – Category Two
Basic Maintenance of Internal Connections
 *NEW* Subject to the Category Two five-year budget
approach
 Support for basic maintenance of eligible internal
connections such as
– Repair and upkeep of hardware
– Wire and cable maintenance
– Basic tech support
– Configuration changes
 Support for BMIC is limited to actual work performed
under the contract
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ESL - Miscellaneous
Miscellaneous
• Eligible Charges
– Taxes, surcharges and other similar reasonable
charges
– Lease fees to rent or lease eligible components
– Shipping charges
– Training
– Installation and configuration
• *New* Installation may be provided by a third
party
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Pricing Transparency
Increasing Pricing Transparency
• Transparency requirements for both E-rate recipients and
vendors begin in FY 2015
• Provides greater visibility into pricing and technology
choices by peers
• Improves analyses performed by the Commission, state
coordinators and third parties regarding the program’s
effectiveness and potential improvement of cost-efficient
purchasing
• Help identify best practices for purchasing and reducing
waste
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Bundling Order
The Bundling Order - DA 14-712
• On May 23, 2014, the FCC issued the Bundling Order
effective for FY 2015 and forward
• Applicants must cost allocate non-ancillary components
including, but not limited to, end user devices such as:
– Tablets
– Telephone handsets
– VoIP handsets
– Netbooks
– Computers
– Laptops
– Cell Phones
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Bundling Order
Tech Plans
• No longer required as part of e-rate
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Pause for a moment…..
• Questions
• Determine your C2
budget?
Category Two Budgets
What are Category Two budgets?
• Each school or library receiving Category Two support in
FY2015 and/or 2016 will have a five-year budget for Category
Two products and services (those that distribute broadband
within schools and libraries).
– Category Two products and services include Internal
Connections, Managed Internal Broadband Services, and
Basic Maintenance of Internal Connections.
– Products and services ordered in excess of an entity’s
Category Two budget will not receive E-rate discounts.
– There is no budget for Category One services (those that
connect broadband to schools and libraries).
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Category Two Budgets
Which entities have Category Two budgets?
• Each individual school and each library outlet or branch has a
pre-discount budget. School districts or library systems may
not average their costs across multiple school or library
budgets.
• Non-instructional facilities (NIFs) – including school NIFs with
classrooms and administrative buildings – do not have prediscount budgets.
– If a NIF is essential for the effective transport of information to or
within a school or library, the applicant must allocate the NIF costs to
the entities benefiting from the service while the costs for ineligible
services to a NIF should be allocated out.
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Category Two Budgets
How much is my budget?
• The pre-discount budget for a school is calculated by
multiplying the total number of students at the school by
$150, with a minimum of $9,200 if the school has fewer
than 62 students.
• The pre-discount budget for a library is calculated by
multiplying the total area in square feet – including all
areas enclosed by the outer walls of the library and
occupied by the library – by $2.30, with a minimum of
$9,200 if the library is less than 4,000 square feet.
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Category Two Budgets
How much is my budget (cont’d)?
• Remember that the budget is PRE-DISCOUNT.
• For example, for a school with 1,000 students:
– At the 85% discount rate (the maximum discount rate for
Category Two), the school will have a pre-discount budget of
$150,000, but may receive E-rate discounts of up to $127,500.
– At the 50% discount rate, the school will have a pre-discount
budget of $150,000, but may receive E-rate discounts of up to
$75,000.
– At the 20% discount rate, the school will have a pre-discount
budget of $150,000, but may receive E-rate discounts of up to
$30,000.
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Category Two Budgets
How do I allocate costs for shared services?
• On the FCC Form 471, you indicate how funding should
be allocated among entities sharing services.
• Your allocation can be:
– Straight-line (all entities share the cost equally)
– Proportional (based on student count/square footage
of each entity)
– Specific (you specify each entity’s share)
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Category Two Budgets
Example 1
• My school has 200 students. How do I calculate my
Category Two pre-discount budget?
– 200 students x $150 per student = $30,000.
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Category Two Budgets
Example 2
• My school has 100 students and a Category Two pre-discount
budget of $15,000. I plan to use the entire amount for
FY2015. If we get 20 additional students for FY2016, how does
this impact my pre-discount budget?
Calculate the budget each year using the total number of students that year.
– In FY2016, 120 students x $150 per student = $18,000.
– Subtract the pre-discount amount used in FY2015 to determine the
amount available in FY2016. Subtract $15,000 budget used in FY2015
from $18,000.
– Available pre-discount budget for FY2016 is $3,000.
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Category Two Budgets
Example 3
• My school district has three schools – School A with 25
students, School B with 50 students, and School C with
75 students. How do I correctly allocate a shared service
with a pre-discount cost of $300?
Straight line Proportional by students Specific (e.g., usage)
A = $100
A = 25/150 x $300 = $50
A uses 30% = $90
B = $100
B = 50/150 x $300 = $100
B uses 15% = $45
C = $100
C = 75/150 x $300 = $150
C uses 55% = $165
$300
$300
$300
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Category Two Services
• Eligible Broadband Internal Connections Components
– Access points used in a wireless local area network (WLAN)
environment or a wired local area network (LAN)
– Antennas, cabling, connectors, and related components used
for internal broadband connections
– Caching
– Firewall services and components
– Switches
– Routers
– Racks
– Uninterruptible Power Supply (UPS)/Battery Backup
– Wireless controller systems
– Software supporting each of the components on this list used
to distribute high-speed broadband throughout school
buildings and libraries
Category Two Services
• Eligible Managed Internal Broadband Services
– Services provided by a third party for the operation,
management, and monitoring of eligible broadband internal
connections components are eligible managed internal
broadband services (e.g., managed Wi-Fi).
– E-rate support is limited to eligible expenses or portions of
expenses that directly support and are necessary for the
broadband connectivity within schools and libraries. Eligible
expenses include the management and operation of the
LAN/WLAN, including installation, activation and initial
configuration of eligible components, and onsite training on
the use of eligible equipment.
– In some managed services models, the third party manager
owns and installs the equipment and school and library
applicants lease the equipment as part of the managed
services contract. In other cases, the school or library may own
the equipment, but have a third party manage it for them.
Category Two Services
• Wi-Fi; Minimum of 3 options:
1. Managed solution where a service provider owns,
manages, monitors, installs and maintains the Wi-Fi
equipment. The school or library leases the
equipment as a managed service.
2. The school or library purchases the equipment but
hires a service provider to manage, monitor, install
and maintain the equipment, but the school or
library retains ownership.
3. The school or library purchases the equipment and
performs all related management, installation and
maintenance of the equipment.
Pause for a moment…..
• Questions
• Ready for Contracts and
SAP?
Contracts
What do I need in place prior to filing FCC Form 471 for contractual
services?
• Applicants should have a signed contract or legally binding
agreement prior to filing the FCC Form 471.
– Contract must be signed and dated on or before the FCC
Form 471 certified postmark date
– Legally Binding Agreement is acceptable when the
applicant can demonstrate written offer and acceptance
exist. Verbal offer and/or acceptance is not allowable.
• Applicants are required to comply with state and local
procurement rules in addition to FCC rules
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Competitive Bidding Exemptions
When is the FCC Form 470 not required?
• Applicants are exempted from the competitive bidding rules when
ordering business-class Internet access services, if:
– the pre-discount cost is $3,600 or less annually, and
– the bandwidth provided is at least 100 Mbps downstream and 10
Mbps upstream
– service and price are commercially available
• Applicants seeking Category Two equipment are exempt from filing
the FCC Form 470 if they purchase from PMC
– The FCC has not yet designated any contracts as PMC
– State master contracts and nation-wide contracts are not the
same as preferred master contracts
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Simplified Application Process (SAP)
Do I have to file FCC Form 471 annually?
• Yes, FCC Form 471 must be filed annually. There is no
multi-year FCC Form 471.
• A simplified application process will be available for
applicants who have a multi-year contract. They will not
be required to complete a full FCC Form 471 during the
subsequent contract years.
– Must complete a full FCC Form 471 the first year you apply
for discounts for that contract using the new FCC Form 471
– Indicate on the FCC Form 471 you have multi-year contract
the first year you apply using the new FCC Form 471
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Simplified Application Process (SAP)
Do I have to file FCC Form 471 annually? (cont’d)
– Contract cannot be longer than 5 years
– Required to provide basic information during the
subsequent contract years
– Does not guarantee funding in the subsequent years
– Required to explain changes to funding (e.g., discount
change, services, etc.)
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Direct Connect
207. In the interest of promoting access to highspeed broadband connections in the simplest and
most efficient manner possible, we take action that
we allow rural schools and libraries eligible for E-rate
support to establish direct connections for the
purpose of accessing high-speed broadband services.
In many rural communities, a library with low
bandwidth may be in close proximity (e.g., across
the street) to a school with significantly higher
bandwidth and could be easily added to the school
WAN. We find that allowing these connections will
afford some schools and libraries that presently
lack access to high-speed broadband the opportunity
to quickly and efficiently benefit from such
connections.
Dark Fiber
Lit Fiber
Microwave
We recognize that it will likely be necessary to waive some of our
rules to allow E-rate support for such connections. We therefore
encourage applicants to file waiver requests for the purpose of
seeking E-rate support for such direct connections.
Dark Fiber
Lit Fiber
Microwave
Category 1 services
Include Equipment as a managed service
Pause for a moment…..
• Questions
• Ready for Lunch?