E-rate from the Service
Provider Perspective
Cynthia Schultz
Train-the-Trainer Workshop
September 27-29, 2004
Schools & Libraries Division
AT THE ONSET
Ask questions! Get answers!
 Use SPIN Search Tool
 If SP not listed, call the CSB
Communicate with your service
provider (SP)
Schools and Libraries Division
Slide #2
TECHNOLOGY PLANS
SP may offer NEUTRAL technical
assistance.
Schools and Libraries Division
Slide #3
THE COMPETITIVE BIDDING
PROCESS
SP should not prepare or draft an RFP.
 SP should not prepare, draft, and/or provide its own
model RFP.
SP must remain NEUTRAL at all times.
SP may not interfere with applicant’s affirmative
duty to conduct a fair and open bid process.
SP may not exert undue influence over an applicant.
Schools and Libraries Division
Slide #4
THE COMPETITIVE BIDDING
PROCESS
SP may not provide funding for
applicant’s undiscounted portion.
SP may not waive applicant’s
undiscounted portion.
SP may not provide hidden incentives,
such as free ineligible services.
Schools and Libraries Division
Slide #5
THE COMPETITIVE BIDDING
PROCESS-PRECOMMITMENT
FORM 470
 SP may offer basic information, such as timelines
and deadlines.
 SP may contribute information on technical issues.
 SP or its consultant may not complete the 470.
 SP or its consultant may not sign the Form 470.
 SP or its consultant may not file the Form 470.
Schools and Libraries Division
Slide #6
COMPETITIVE BIDDING
REQUIREMENTS-PRECOMMITMENT
Applicant is to consider all viable bids
received during the 28-day waiting period.
Price of eligible goods and services must be
the primary factor, that is, it must receive the
greatest weight of any factor.
Schools and Libraries Division
Slide #7
COMPETITIVE BIDDING
REQUIREMENTS
Applicant must comply with the 28-day
waiting period after filing the Form 470 to
choose a service provider and enter into a
contract, as applicable.
 Contract not required for month-to-month services
 Contract required for contracted tariffed services.
Schools and Libraries Division
Slide #8
SERVICE PROVIDER ASSISTANCE
SP should always provide correct
SPIN(s) and contact information.
 Form 498 available on line since November
2003 and online certification to be made
available Fall 2004.
 Important for companies with multiple
SPINs
Schools and Libraries Division
Slide #9
SERVICE PROVIDER ASSISTANCE
SP is encouraged to assist with providing
information for the Form 471 Item 21
attachment for its services.
 Applicant encouraged to provide relevant Item 21
attachment to service provider upon request.
 Clear level of detail on the Item 21 attachment
may advance the processing of the invoice.
An example of such detail would be the
inclusion of the item (model #), quantity, and
unit cost.
Schools and Libraries Division
Slide #10
SERVICE PROVIDER ASSISTANCE
Applicants will not receive support for contracts
that provide only a single price for a package that
bundles both eligible and ineligible services
together.
 SP and applicant should work together to create pricing
terms in the contract that separate eligible services from
ineligible services.
SP is also encouraged to assist in providing
applicant with billing account numbers and contract
numbers.
Schools and Libraries Division
Slide #11
CONTRACT REQUIREMENTS
 FCC Rules require applicant to sign a contract prior to the
filing of a Form 471. 47 C.F.R. §54.504(c).
 The FCC Fifth Report and Order requires both the applicant
and service provider to sign the contract prior to the filing of a
Form 471.
 This rule does not apply to non-contracted tariffed or
month-to-month services.
 Verbal agreements are not acceptable.
 Quotes are not acceptable.
 Purchase orders are acceptable if considered a contract
pursuant to state and local procurement laws and state
contract laws.
Schools and Libraries Division
Slide #12
CONTRACT REQUIREMENTS
Service provider and applicant must comply
with state contract law.
Service provider and applicant must comply
with state and local procurement laws.
Legally-binding agreement is another term for
contract.
Schools and Libraries Division
Slide #13
CONTRACT REQUIREMENTS
Applicant must provide signed and
dated contracts for reviews and audits.
 Applicant must be prepared to prove its
contract meets the requirements of state
contract law.
Applicant certifies that it has signed a
contract on its Form 486.
Schools and Libraries Division
Slide #14
CONTRACT AWARD DATE
 The Contract Award Date cannot be earlier than
28 days after the posting of the Form 470.
 If an applicant files its own Form 470 and chooses
either a new or a pre-existing state master contract
as the most cost effective bid, the applicant should


memorialize its decision to purchase off the state
master contract after the bidding process is complete
and
record the date of this memorialization as the relevant
Contract Award Date in its submitted Form 471
application.
Schools and Libraries Division
Slide #15
CONTRACT AMENDMENTS
Contract services may be amended if the
contract allows for such an amendment, but if
those services were not posted on the original
Form 470, the applicant must post a new
Form 470.
If the original Form 470 or RFP did not
include the newly-eligible services or
entities, the applicant will be required to post
a new Form 470 for those services.
Schools and Libraries Division
Slide #16
CONTRACT AMENDMENTS (cont.)
If the contract allows for service substitutions
and there is a change on the Item 21
attachment, then the applicant or service
provider should submit a service substitution,
as applicable to SLD rules.
Contract dates may be amended if the contract
allows for such amendments.
 If applicant and service provider extend the
contract date, the applicant is required to file
a Form 500.
Schools and Libraries Division
Slide #17
CONTRACTS WITH VOLUNTARY
EXTENSIONS
A contract featuring voluntary extensions means that
the contract expires at the end of its original term and
may be voluntarily extended for one or more years
pursuant to the provisions in the contract.
 The applicant should indicate in Item 7b on the Form 470
whether it is seeking a multiyear contract and/or contract
featuring voluntary extensions. It may provide more detail
in its RFP and/or Item 13 on the Form 470 about the length
of the multiyear contract and/or voluntary extensions.
Best Practices—RFP and/or Form 470 should provide a range in
years, for example—one- to three-year extension, three- to fiveyear extension.
Schools and Libraries Division
Slide #18
MULTI-YEAR CONTRACTS
A multi-year contract means a contract that covers
more than one year.
 For example, a three-year contract would expire at the
end of the third year.
 The applicant should indicate in Item 7b on the Form
470 whether it is seeking a multiyear contract and/or
contract featuring voluntary extensions. It may
provide more detail in its RFP and/or Item 13 on the
Form 470 about the length of the multiyear contract
and/or voluntary extensions.
Schools and Libraries Division
Slide #19
REIMBURSEMENTS V. DISCOUNTS
 Service provider is required to permit the applicant prior to the
submission of the Form 471 to choose the Method of Payment
— BEAR v. SPI — for discounted services
 FCC Second Report and Order encourages the applicant and
service provider to work together to determine the method of
payment.
 FCC Second Report and Order encourages parties to include
the method of payment in the contract.
 Notify SLD through online e-mail if SP refuses to permit
applicant to choose methodology.
Schools and Libraries Division
Slide #20
CONTRACT DISPUTES
Know your legal rights.
SLD does not intervene in disputes that are
contract-based rather than program-rule
based.
 Contract disputes should be brought before local
and state courts, not the SLD or the FCC.
Schools and Libraries Division
Slide #21
STATE MASTER CONTRACTS
Scenario A. If the state filed a Form 470, then the
applicant may cite the state’s Form 470 on its Form
471.
 The applicant is required to follow the applicable provisions of
the state master contract and local and state procurement laws.
 No separate bidding documents or contracts are required by the
applicant citing the state’s Form 470, other than what is required
by the state master contract and local and state procurement
laws.
 The signed state master contract between the state and service
providers meets the FCC signed contract requirement.
Schools and Libraries Division
Slide #22
STATE MASTER CONTRACTS
Scenario B. If the applicant files a Form 470 and
considers a state master contract as one of the
bids:
 The applicant is required to comply with the
competitive bidding requirements
Price must be the primary factor and must be weighted more
heavily than any other factor.
 If the applicant selects the state master contract:
The applicant is required to follow the applicable provisions
of the state master contract and local and state procurement
laws.
The signed state master contract between the state and
vendors meets the FCC signed contract requirement.
Schools and Libraries Division
Slide #23
STATE MASTER CONTRACTS
If the state master contract requires the issuance
of purchase orders or contains other requirements
for applicants
 The applicants must follow the applicable dates set
forth in the state master contract.
 For example, if the state master contract requires the
applicant to issue a purchase order by July 1, then the
applicant is required to meet that deadline.
Schools and Libraries Division
Slide #24
ELIGIBLE TELECOM PROVIDER
Eligible Telecom Provider is a USAC
term.
The FCC term is Telecommunications
Carrier.
 SLD will be changing the use of this term
from ETP to Telecommunications Carrier
to comport with FCC statutory and
regulatory definitions.
Schools and Libraries Division
Slide #25
TELECOMMUNICATIONS CARRIER
SP may not provide telecom services if it has not
been designated as a telecommunications carrier in
the Telecommunications Carrier database.
 New TC search database on SLD web site will
provide:
Status of designation on SP Name and SPIN
basis
Date of USAC designation
List of applicable states
Schools and Libraries Division
Slide #26
TELECOMMUNICATIONS CARRIER
(cont.)
FCC and SLD requirements for TC
designation are:
 SP must provide telecommunications
services on a common carrier basis.
 SP must file a Form 499 and ensure that the
Form 498 reflects the Form 499 Filer. I.D.
 SP must be designated a TC in SLD
database.
Schools and Libraries Division
Slide #27
TELECOMMUNICATIONS CARRIER
(cont.)
Applicant Beware—If an applicant
applies for telecommunications services
from an ineligible service provider,
funding for those FRNs will be denied.
When seeking telecommunications
services, applicant should check for the
status of telecom designation on the
SLD web site.
Schools and Libraries Division
Slide #28
WORKING WITH YOUR SERVICE
PROVIDER
Review contracts, bills, invoices,
amendments, service certifications –
anything you are asked to sign or review
Review all certifications before signing
BEAR
 Applicant should provide the entire
documentation to the service provider, not
just the Block 4 SP certification page.
Schools and Libraries Division
Slide #29
WORKING WITH YOUR SERVICE
PROVIDER
Make sure documents are shared with
the proper departments.
Work with the service provider on
service substitutions.
Work with service provider on Item 21
attachment.
Schools and Libraries Division
Slide #30
DOCUMENT RETENTION
POLICY
Remember 5-year retention requirement for
all documents.
Good recordkeeping is ESSENTIAL.
Keep copies of EVERYTHING.
Keep these documents with E-rate files, or
copies, if accounting department keeps its
own files.
Schools and Libraries Division
Slide #31
DOCUMENT RETENTION
POLICY
 See FCC Fifth Report and Order for a detailed list.
 Types of Records to Retain Include:
 Competitive bid documents
RFPs, Bids, Quotes, Proposals, etc.
 Signed Contracts and Purchase Orders
 Service provider bills to customers
Detail of services/products and locations
Indicate entity(ies) receiving service/products
Delivery/installation dates
 Applicant payments
Cancelled checks
Service credits for any reason
Schools and Libraries Division
Slide #32
TYPES OF SPIN CHANGES
Global SPIN Changes – mergers or acquisitions in
whole or in part
 Considered a Corrective SPIN change
Corrective SPIN Change – to correct data entry
errors or where the applicant used the wrong SPIN
for the service provider selected
Operational SPIN Change – reflects change in
service provider by applicant and is only available
after receipt of FCDL
Schools and Libraries Division
Slide #33
CORRECTIVE SPIN CHANGES
Not limited just to RAL; can make change
at ANY time before the last date to invoice.
Schools and Libraries Division
Slide #34
OPERATIONAL SPIN CHANGES
For changes to a new service provider
Applicant must make three certifications:
 Change allowed under local procurement laws
 Change allowed under terms of contract
 Original SP notified of intent to change
New guidance on web site requiring date and
manner of notice.
Can NOT be used for telecom services if new
SPIN is not eligible telecom provider.
Schools and Libraries Division
Slide #35
SPIN CHANGE GUIDELINES
Requests must be received by the last date
to invoice.
Can NOT be used if FRN originally denied
for ineligible provider; denials MUST be
addressed through appeals process
Schools and Libraries Division
Slide #36
QUESTIONS
Schools and Libraries Division
Slide #37