The Federal Communications Commission has adopted new eRate rules to address many of the waste, fraud, and abuse issues unearthed during audits by the agency's Office of Inspector General. The rules changes were approved unanimously at an Aug. 4 hearing, though Commissioner Kevin Martin dissented in part with the agency's decisions.

Specific details were not yet available at press time, but Mark Stevens, senior auditor in the FCC's Wireline Competition Bureau, highlighted for commissioners the most significant changes in the agency's Fifth Report and Order, including:

• A framework for heightened scrutiny for applicants and service providers that have violated eRate rules in the past;
• An extension of the rule that bars fund recipients from receiving additional program benefits if they have yet to repay the fund for past erroneous disbursements;
• New certifications that applicants will have to make as a prerequisite to funding;
• Clarification and tightened guidelines for technology plans that applicants must develop before applying for funds; and
• A lengthening of the time applicants must retain all eRate documentation to five years, so that any misdeeds can be more easily detected.

"Taken together, the order is a major step toward fortifying the eRate program against the opportunities of waste, fraud, and abuse," Stevens said. "Where malfeasance does occur, this order strengthens the commission's ability to detect it, investigate it, and--where necessary--prosecute it."

Commissioners each praised the eRate program--which gives discounts of up to 90 percent of the cost of telecommunications services and internet access to eligible schools and libraries--for successfully connecting 99 percent of the nation's schools and 92 percent of its classrooms to the internet. Though they all pledged their continued support for the program, they also acknowledged that the eRate's survival depends on their ability to rid the program of wrongdoing.

"Our continued oversight is critical. I think that if we don't prove that this is being used properly and appropriately, then the program's survival is at stake," said FCC Commissioner Kathleen Q. Abernathy. "I'm committed to working with all the schools and the libraries across the country, with all of you, and with [the Universal Service Administrative Co., the agency that administers the eRate] to ensure that this program is run efficiently and effectively."

Abernathy said she was pleased with the new requirements for document retention as well as the clarified rules governing technology plans, but she added that commissioners still need to look at additional ways to improve the program--including possibly changing the discount levels that dictate how much money schools and libraries are required to contribute.

Many eRate experts had anticipated that the FCC would lower the maximum discount level for internal connections--the wiring, routers, switches, and file servers necessary to deliver internet access to classrooms--to 70 percent, forcing schools to contribute at least 30 percent of the cost of these services themselves.