E-rate from the Service Provider Perspective Cynthia Schultz

1. E-rate from the Service Provider Perspective Cynthia Schultz Train-the-Trainer Workshop September 27-29, 2004 Schools & Libraries Division

2. AT THE ONSET • Ask questions! Get answers! • Use SPIN Search Tool • If SP not listed, call the CSB • Communicate with your service provider (SP)

3. TECHNOLOGY PLANS • SP may offer NEUTRAL technical assistance.

4. 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.

5. 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.

6. 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.

7. 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.

8. 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.

9. 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

10. 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.

11. 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.

12. 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.

13. 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.

14. 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.

15. 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.

16. 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.

17. 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.

18. 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 five-year extension.

19. 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.

20. 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.

21. 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.

22. 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.

23. 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.

24. 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.

25. 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.

26. 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

27. 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.

28. 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.

29. 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.

30. 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.

31. 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.

32. 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

33. 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

34. CORRECTIVE SPIN CHANGES • Not limited just to RAL; can make change at ANY time before the last date to invoice.

35. 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.

36. 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

37. QUESTIONS