Transcript Document

E-rate – What is it?
Presented by:
Joe Melloy
April 19, 2007
My Background
Joseph P. Melloy, Sr.

33 years with IBM

Technical marketing, systems engineering, management
Higher Education Technology Consultant
 1981-1993
President, Technology Planning Group,Inc
 1993 to the present
 Higher education clients – Mid-Atlantic area
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Delaware, Virginia, Maryland, Pennsylvania, New Jersey
K-12 clients – Pennsylvania and Delaware
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Recent activities: Vision 2015 Working Group
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Technology plans – charter schools
E-Rate expertise – Pennsylvania and Delaware
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Contact Information
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[email protected]
Cell 302-547-8517
3
Agenda
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Background of the E-Rate
What products and services are eligible for
discounts?
How is the discount determined?
When is the next E-Rate process “Year”?
What is the process?
HOW HAS DELAWARE DONE IN
ACQUIRING E-RATE FUNDS?
What is my school or district’s plan to secure
E-Rate funding for educational technology?
4
What is E-rate?
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Telecommunications Act of 1996 established
“Universal Service Discount Program for Schools
and Libraries”
Annual $2.25 billion program
Provides 20-90% discounts on
telecommunications services, Internet access,
and internal connections
Fund made up from charges on your phone bills
Most public libraries, public and private K-12
schools, including charters and vo-techs are
eligible
5
How Has Delaware Done?
Over
ten years
of the E-Rate
program…..
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The Answer:
NOT
WELL!
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Last Place Among Fifty States for Each
of the Ten Years of the Program
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Source: Article: “E-Rate Discount Totals Over 10
Years’
 Source www.nctet.org
Total of Ten years of Discounts:
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Delaware $11,044,978.
Similar population states:
New Hampshire $15,875,210
 South Dakota
$42,258,467.
 Rhode Island
$58,958,867.
 North Dakota
$32,628,670
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8
DE Comparison to Nearby
States
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NORMALIZE 10 years of data to $ PER
STUDENT / PER YEAR COMPARISON
State E-Rate $ #Students $ / Student/ Yr
MD $152mm
865,561
$17.54
PA $629mm
1,828,089
$34.42
NJ $436mm
1,393,347
$31.28
DE $11mm
116,342
$ 9.50
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New DE E-Rate Strategy Needed
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First, Let’s Talk About the Details of
the E-Rate………
Strategy will evolve by the end of this
presentation after we look at
THE PROCESS……..
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Who Administers E-rate?*
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FCC
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USAC
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Created program and its rules
Universal Services Administrative Company
Created by FCC to run E-rate and other
universal service programs
Pays invoices
SLD
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Schools and Libraries Division
Entity within USAC that runs E-rate
Makes no policy decisions
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E-Rate Funds

Who contributes the funds
that are set aside to fund
technology for schools in
schools and libraries?
12
The Answer:
We
all do!
When we pay our
telephone bills….
 Universal
Access Charge
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Public Service Commision Report
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Delaware PSC, FCC hearing, June 14, 2005
“Delaware end-users pay 10.2% surcharge on
their telephone bills”.
“In 2005, Delawareans will pay $21 million in
this surcharge and will receive back only
$685,000 in federal E-Rate funds. Something
must be done to limit the size of this fund.”
Source:
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Bruce Burcat, Executive Director
Delaware Public Service Commission
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How are they distributed?
1.
2.
3.
4.
WE APPLY FOR THEM.
OUR APPLICATIONS ARE APPROVED,
BASED ON THE FACTS WE PROVIDE.
THE DISCOUNTS ARE DETERMINED BY
THE ADMINISTRATIVE ENTITY IN
WASHINGTON – USAC.
THE APPROVED SERVICES ARE
PROVIDED AT THE DISCOUNTED RATE.
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Why Are We Talking About ERate?

DE schools and libraries can apply
alongside 30,000 other schools and
libraries in U.S
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You want to make sure you know how
to complete forms, etc., so you can
get the funding you’re entitled to.
Work with a qualified consultant
and/or utilize in-house staff to insure
accuracy and legitimacy of all
requests.
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Fair Warning!
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E-rate is not an easy process
Only for the strong willed and determined
Long process, a lot of paperwork, some
frustration
Patience is needed, in addition to
diligence in reading correspondence
Rewards can be great
Never ever try to cheat the program
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Resources to Remember*
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SLD web site:
www.sl.universalservice.org
SLD CSB: 888-203-8100
Or Google search “SLC E-Rate”
Other state E-Rate websites
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Applicants
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Must use E-rate Entity Number in order to participate
 One for every building in your district or library
 All applicants already have unless it’s a new building
Must have FCC Registration Number (FCCRN)*
 Just for billed entity
 All applicants should have obtained in Yr 7
Must have NCES code (schools) or FSCS (libraries)
 Listed on PA E-rate website under Helpful Documents
 Leave blank if none exists
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Service Providers*
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Must obtain Service Provider Identification
Number in order to participate (9 digit #)
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Not required to pay into Fund to get SPIN
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Info on SLD web site under Vendor Area
Service Provider/SPIN Search on SLD web site
Only telecom carriers must pay
Only sign contracts with providers that have
SPIN
Providers should update contact info on Form
498, Block 11
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Funding Priorities
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Needed - demand exceeds cap of $2.25 billion
Priority One: Telecommunications and Internet
Access
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All approved-inside the window-likely to be
funded
Priority Two: Internal Connections & Basic
Maintenance of IC
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Funds go first to neediest applicants (90%
discount level), then to others in order of
discount until funds are exhausted
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Year 1 -- funded to 70%
Year 2 – all approved applications funded
Year 3 – down to 82%
Year 4 – down to 87%
Year 5 – down to 81%
Year 6 – down to 70% - significant rollover funds
Year 7 – down to 81%
Year 8, 9, 10 – approximately 86%
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Funding Priorities
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What does this mean?
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Always apply for all telecommunications
services and Internet access – you’ll get
those discounts.
Make judgement call on internal
connections depending on discount level
and time available to complete
application
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Exactly what services ARE and
are NOT eligible?
Current and Future Services
You Use or Plan to Use
Eligible Telecom Services
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MUST be provided by regulated
telecommunications carrier
Basic Telecom Services
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Advanced Telecom Services
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Local, long distance & voice mail
T-1, ATM, Frame Relay, ISDN, lit fiber, etc.
Satellite services and leased dishes
Voice over IP (Internet Protocol) 
ADDED IN 2007!
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E-Rate Discount Checklist
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Source:
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www.universalservice.org/
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“Eligible Services List”
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Note page number in first column
IMPORTANT:
“Check conditions of Eligibility of
each service or product”
 Can be done at school, district or consortium
level.
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Eligible Telecom Services, cont.
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Wireless Services
 Cellular service – all staff eligible
 Paging service
Calling cards
 Not pre-paid cards
Centrex, custom calling features
Installation fees OK
Can be installed before funding year begins so
services are ready by July 1
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Ineligible Telecom Services
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900 Calls
Payphones
Cost of not-publishing phone numbers
Cost of additional directory listings
End user equipment (phones, beepers, cell
phones, fax machines, etc.)
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Eligible-Tariffed Services/MTM*
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Services that are purchased mainly from a phone
company, such as T1
OR
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Monthly services such as cell or Internet Access
For which no contract is signed
Must competitively bid every year, regardless of
competition in your area for those services
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Fiber Networks*
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Dark Fiber (unlit) is not eligible
Lit Fiber is eligible … IF
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Modulating electronics are bundled with
the lease cost of the fiber
Applicant will never own fiber
Applicant cost allocates any lease of
fiber that isn’t being used in that
funding year.
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Internet Access
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Eligible:
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Subscription fee to
ISP
E-mail
Firewall fees
Webhosting
Internet bandwidth
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Ineligible:
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Filtering
Any remote access
outside school
property to internet
Blackberry services
presumed ineligible
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On-premise, Priority 1
Equipment*
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Permitted if bundled from telco or
ISP
Must certify:
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No applicant ownership – ever
No exclusive use
LAN functions without use of equipment
Service provider maintains equipment
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Not applicant
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Eligible Internal Connections
 System operating
 Network and
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phone wiring
Routers
Switches
Hubs
Network servers
Video codecs
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software
Wireless Access Points
Private branch
exchange (PBXs)
Firewalls
Anything needed for
transport – not end
user devices
Installation of eligible
internal connections
“Basic” Maintenance
contracts on eligible
internal connections
 basic maintenance 32
Ineligible Internal Connections
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Personal computers
FAX machines
Asbestos removal
Cameras
Electrical wiring
Teacher training
 Network management s/w
 Routers used for remote
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access
Curriculum software
Phones, beepers
Owned WANs
Salaries of SD staff to install
or maintain network or
components
Any equipment used for
remote access to network or
Internet
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Gotcha!
Words to Never Use with SLC
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2-way Radios/walkietalkie (direct connect
OK as a cell service)
Filtering
Network monitoring
Directory
advertising/listings
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Cellular phones
Management
Redundancy
Helpdesk
24 hour technical
support
Insurance policies
Remote access
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Application process at a Glance*
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UPCOMING: Year 11 - Details
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For services rendered 7/1/2008 6/30/2009
Application process begins Nov., 2007
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Five months away…..ninety day exercise.
Write tech plan now
Review Form 470 requirements
File 471 when window opens (normally
beginning of November)
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Window will close first week in February, 2008
Must be inside window to be funded for 08-09
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You Must Have a Technology
Plan!*
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Five SLC technology plan criteria
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Goals and Strategies for using technology
Needs Assessment
Professional Development
Budget – including sources of funding
Evaluation
Must align with 470 request for services
Must be “written” before 470 is filed
Must cover full 12 months of NEXT funding year
Plan must be approved by DCET (Denise Allen)
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Technology Plans, cont.
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“Vendors” cannot write or approve technology
plans
No tech plan required for basic phone service or
long distance (includes cell and voice mail)
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Be sure to include dates of tech plan!
Get approval letter by July 1
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Centrex is not basic phone service
then Print/Maintain Approval Letter
Tech plans approved for no more than 3 years
Certify on 486 who approved plan
Can amend technology plan if yours is not
specific enough
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Competitive Bidding
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Everyone must do it
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Even if no competition in your area
Even if bidding under state law
Must be done when signing any new contracts
Must be done each year for all tariffed/MTM
services
Bidding on web site does not exempt you
from bidding under state law
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Can be done simultaneously
Only exception is if someone bid it for you
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Choosing the Winning Bid
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Applicant must to pick “most cost-effective bid”
Cost doesn’t have to be only factor, but must be most
heavily weighted factor
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For example, if you have 3 bid evaluation criteria, price
must be at least 34% of total weight.
Examples of other specified factors:
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Prior experience
Personnel qualifications
Technical excellence
Management capability
Cost of switching providers
Etc.
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Signing E-rate Contracts*
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Signing Contracts/Selecting Provider must be
done before you submit 471
Be careful not to make any decisions, sign
anything or file any forms during 28 day waiting
period.
Contracts must be signed and dated by both
parties
Must sign contracts unless tariff or MTM service
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If selecting PEPPM, no contract needed, but you must
be able to explain why you chose reseller A over
reseller B
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Signing E-rate Contracts*
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List contract extensions and contract expiration
dates
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These also must be listed in RFP or 470, Item 7b
Include non-E-rate funding out clauses
Separate internal connections/wiring portions of
contracts for highest discount schools
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What is My Discount?*
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Two criteria make up discount:
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Poverty level - Federal School Lunches
Location -rural classification
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Discount Matrix for Single
School*
% of Students Eligible for
School Lunch Program
Discounts
Urban
Rural
<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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Alternative Measures to NSLP
Data*
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Goal: Discounts based on true eligibility – not
participation.
2 Ways to do this
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Take existing participation data and add to it
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Using sibling match
Using existing family income data
Conduct family income survey
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Must survey 100% of families. If 50% response rate,
then OK to extrapolate the rest
Maintain complete records
Sample survey available*
Valid for 2 years
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Discount Calculations by Entity*
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Schools: Use straight matrix discount
Districts: Use weighted average of schools’
individual discounts
Library: Use the total number of students eligible
for NSLP in the school district in which the
library is located divided by the total number of
students in that school district, then use matrix
discount
Library System: Uses simple average of member
libraries’ discounts
Consortium: Uses simple average of members’
discounts
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If You Are an Individual School*
1
3
4
5
6
7
Name of School
Urban or
Total
# of Students
% Students
Discount
Rural
# of
Eligible for NSLP
Eligible for
% from
U or R
Students
NSLP
Discount
Col. 5/Col. 4
Matrix
50%
80%
Oak Elementary
R
100
50
Always uses straight matrix discount for single schools.
47
If You Are a School District*
District discounts are based on weighted average discounts,
based on individual school discounts.
1
3
4
Name of School
Urban or
Rural
U or R
Students
R
R
R
100
212
566
Oak Elementary
Spruce Jr. High
Elm High School
5
6
7
Total
# of Students
% Students
Discount
Weighted Product
# of
Eligible for NSLP
Eligible for
% from
for Calculating Shared Discount
NSLP
Discount
(Col. 4 x Col. 7)
50%
46%
48%
80%
70%
70%
80.00
148.40
396.20
50
98
273
8
District Totals for calculating
Weighted Average Discount
878
10c Weighted Average Discount % for Shared Services
(Col. 8 total divided by Col. 4 total. Round to nearest %)
624.60
71%
48
If You are a Library Outlet/Branch
or Library System*
1
2
3
4
5
6
7
8
Name of Eligible Entity
Entity Number and
Urban or
# of Students in
# of
% of
Discount from
Entity
FSCS of Library
Rural
District
Students
Students
Matrix
Number of
Eligible for
Eligible for
School
NSLP in
NSLP
District in
District
which Library
is Located
Treetop Branch Library 123123
Greenleaf Branch Library 123234
Acorn Branch Library
123122
U 987654321
525
U
800
U
1220
200
130
350
38%
16%
29%
60%
40%
50%
125246
125400
125659
System Totals for calculating Shared Discount
10c Library Systems % (Col. 7
total divided by # of sites in Col. 1.
50%
49
If You Are a Consortium*
1
ELIGIBLE MEMBER ENTITIES
Name of each individual school, school district and/or
library/library system in consortium
Treetop School District
Woodsville Library System
Forest Academy
Totals for calculating Shared Discount
10c Shared Discount %
(Col. 4 total divided by # of sites in Col. 1. Round
to nearest %)
4
ENTITY DISCOUNT
Individual School: Discount from Worksheet A
School District: Weighted average discount calculated in Worksheet A
Library System : Shared discount from Worksheet B
71%
67%
60%
198%
66%
50
Paying Non-Discounted Portion

If your discount is 65%, you MUST have the
ability to pay the remaining 35%
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Must have the nondiscounted portion in budget
Many vendors will say they can get a “grant” for
this amount – NOT PERMITTED
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How do YOU get E-rate $?
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Two choices
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Discounts on bills
OR
Reimbursement process
Must select one or the other for entire year
Try to determine choice in contract or prior
to choosing service provider
If you want discounted bills, call provider
as soon as you are funded
52
Document Retention*
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Rules now require all applicants to retain
ALL E-rate and related documents for 5
years from last day of service in a
particular funding year
If auditor visits in 4 years, and documents
are missing, it will be the basis to recover
all funding from that funding year
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Documents to Retain*
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Tech plan and
approval letter
Consultant
agreements
RFP and proof of
publication date
All vendor
correspondence
Winning and losing
bids
Professional
development records
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Contracts signed by
both parties
NSLP documentation
Budgets
Purchase orders
Packing slips
Asset or inventory
records
Installation records
Invoices
Proof of payment to
SLD
54
Transfer of Equipment*
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E-rate funded equipment must remain at
approved site for 3 full years after installation
After which it may be moved to another eligible
location, providing documentation is retained
describing transfer
If school or library closes, equipment may be
moved to another entity, regardless of discount

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Must send letter to SLD outlining closing of school
and transfer of equipment
Must keep documentation regarding transfer for 5
years
55
E-rate Consultants
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Not a bad idea if you have complex application
Be certain that the consultant:
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Provides training
Is in constant communication with you
Provides you with copies of all forms
Provides you with periodic updates on your
applications
Does not sign your forms
Does not have any relationships with vendors
Sign Letter of Agency
56
E-Rate Consultants

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Unique skill and experience required
Best to work with the school or
district
Cost of Consultant? Depends:

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Fixed Price Contract
Pay by the hour
OR:

Based on dollar savings in obtaining
discounts for equipment, services, etc.
 Usually 25 to 30%!
57
Future of E-rate - FCC

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
New FCC Chairman, Kevin Martin
Appears to be supportive of E-rate
Congress will continue to evaluate
DELAWARE –
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
Public Service Commission unhappy
that too little funds from Universal
Access Charges are coming back to the
state.
State must seize the opportunity and go
after E-Rate funds it’s entitled to!
58
WHO IS RESPONSIBLE?
WE
ALL ARE!
59
Follow-up: Interested in Proposal of
Consulting Services?
Send Letter of Intent of your
E-Rate interest:
 Direct to:

Joe Melloy, President
 Technology Planning Group, Inc.
 PO 149
 Montchanin, DE 19710

 OR:

Email: [email protected]
60
Thank You
Questions:
61