What E-rate applicants struggle with–and what they’d like to see changed

As part of our National E-rate Survey, eSchool News and Funds For Learning conducted a virtual focus group to learn more about the particular strengths and challenges of the E-rate process–and what applicants would change about this process if they could.

The online panel discussion took advantage of EDRoom, a secure, private web space where district administrators, school-level educators, and others in the academic community can engage in deep discussions on any topic.

When EDRoom is used for research or journalistic purposes, it is modeled after a traditional focus group to generate group interaction. As with a traditional focus group, a moderator presented questions for discussion. A key advantage over a traditional focus group, however, is that the online conversation took place over the course of an entire week, and participants had flexibility as to when and where they logged on. Panel members took part in the discussion by reading and typing at a computer–without ever leaving their seats, at times that were convenient to them.

Participants were recruited from among respondents to our national survey, and they were chosen to reflect a wide range of perspectives. Here are the panel members:

• Dennis Bucholtz, IT director of New Hope Academy Charter School of Pennsylvania, with a discount rate of less than 50 percent;
• Jim Copley, an internet specialist with Educational Service Unit No. 13 of Nebraska, a consortium of school districts with a discount rate of between 60 and 70 percent;
• Cheryl Stepp, instructional technology supervisor for Florida’s Osceola County Schools, with a discount rate of between 70 and 80 percent;
• Kathleen Talbot, assistant principal of St. Josaphat School, a private religious school in Chicago with a discount rate of less than 50 percent;
• Bonnie Tollefson, director of Florida’s Levi County Public Library System, with a discount rate of between 80 and 85 percent;
• Laurie Walsh, IT systems specialist for the Montgomery County Public Schools in Maryland, with a discount rate of between 50 and 60 percent; and
• Kathryn Wilson, E-rate administrator for the North Carolina Office of IT Services, which applies for E-rate discounts on behalf of the state’s school systems, with a discount rate of between 70 and 80 percent.

What follows is an excerpt from the discussion. To read the entire transcript, go to http://www.eschoolnews.com/news/special-reports.

Q: What parts of the E-rate process do you manage exceptionally well? How do you manage these parts of the process, and what information would you share with other E-rate applicants to help them?

Laurie: I manage the Form 471 exceptionally well, because I begin with the previous several years’ applications and project changes from this base. It is very similar to budget preparation. …[We’ve managed] document retention via the introduction of a scanner and database system. I checked with the SLD to make sure that electronic copies of bills and forms would be acceptable in the case of an audit or review and was assured that this was, indeed, the case.

Cheryl: I have been applying for and receiving E-rate funds since the [program’s] inception and am comfortable with filing a Form 470 as needed for a specific purpose. I work closely with the director of information technology [and] monitor our free/reduced lunch carefully, [giving] him a heads-up on any schools that look like they will be 90-percent [discount] schools. Then we determine if their wiring closets need updating. We also carefully track the Two-in-Five Rule. We have been able to keep our closets in decent condition this way.

We download the new Eligible Services List each year, and I keep both an electronic copy and a hard copy on file. We read through the list to determine the changes. We also attend an annual meeting provided by our state E-rate office that makes sure we note changes in eligible services.

Our school district has a very high mobility rate, so I pick one day in October and lock in to that day. I request the food-service report for that day…[and] prepare a spreadsheet. We also open one to four schools per year, and I always need to remember to get entity numbers for them ahead of time. I put in for the new schools at the lowest free/reduced lunch rate so that I won’t have audit problems.

I always get audited, because our free/reduced rates are as volatile as our mobility rate. I have always been able to prove that the rates are as I claim, but [I’ve had] to get the director of food service and sometimes our superintendent involved.

Kathryn: Form 470/procurement process–as long as the procurement folks listen to us and understand that the 28-day posting period cannot be shortened, the procurement process goes fairly smoothly.

Service eligibility–we always try to match the service we are seeking as exactly as possible to the Eligible Services List. This is an area where "thinking outside the box" should never be done; it means you will receive many questions during PIA review [and] could be denied [funding].

Form 471–don’t even attempt to file this until the signed contract is in your hand; be sure all the documents (contracts, lunch numbers, LOAs, etc.) are together in the same file. Before submitting online, we always do a "practice" copy.

Application review–if you can’t give PIA [staff] what they have asked for right away, see how much time they will give you; don’t wait until the day it is due! If you have a consortium, make sure the reviewer knows from the beginning that you might have to obtain information from other folks. Don’t ever blame the reviewer when you get requests for the same information over and over, just fax or eMail it to them (and pretend to smile).

Document retention–save everything and keep it in a file where, heaven forbid, if something happens to you, it can be located by someone else. Print out eMails, keep proof that faxes were received, [and] keep proof that documents were received by the SLD–send [them via] certified mail, [with] return receipt requested.

Appeals–consult an attorney; it is well worth the time and money.

Q: What parts of the E-rate process do you not manage well or need more assistance with? What additional informational resources would you like from the FCC, USAC, or SLD to improve your ability to administer or manage these parts of the E-rate process?

Laurie: I find that the most difficult part of the E-rate is meeting the deadlines and juggling three funding years at a time. I have notes all over my office with deadlines [and] funding year dates–including a translation to calendar year, fiscal year, and E-rate year. Meeting the deadlines is difficult, because I rely on responses from many different people during the preparation of the 471.

I would like the SLD to [request] repetitive requirements during the review [process]–such as signed enrollment and free and reduced lunch documentation–as part of the actual application. If we are always asked for the same documentation, why wait for the review to supply [it]?

Jim: Document retention can be a real problem. Last year, the SLD made available on its web site a "Guide to E-Rate Binder Table of Contents," which lists the documents that applicants might need to keep. It lists 66 documents. …Any help or resources to make documentation retention [easier] would be most appreciated.

Q: What rule changes to the E-rate process would you like to see that would make the program easier for applicants–but would still ensure that the process guards against waste, fraud, and abuse?

Laurie: I would like to see the deadlines for the 471 moved closer to the start of the fiscal year in which the products will be purchased. Our vendors have a difficult time making bids so far in advance, and our larger vendors have problems getting new contracts prepared in time for us. The good news is that we now only have to have one signature by the close date. Our common carrier has all kinds of legislative hoops to jump through before they can counter-sign contracts.

I would like to go back to the original concept of a straight discount for schools. It would eliminate the SLD and all of the rules and all of the paperwork. I met one of the original developers of the program, and it is his greatest regret that this seemingly simple discount program has become such a behemoth of government.

This isn’t exactly a rule change, but I would like to see more technical or school people join the ranks of the reviewers. I seem to spend a lot of time explaining how technology works or what the various components of a phone bill mean…to reviewers who seem to be in place with the sole purpose of getting applicants to concede money.

There are too many forms, too many signatures, and too many rules.

Kathleen: I agree with Laurie about the dates and paperwork. The deadlines really do not coincide with when schools need to negotiate contracts. …The amount of paperwork and the terminology with which the average teacher, technology or otherwise, is unfamiliar, makes the simple job of applying for E-rate funds cost a lot in man-hours. I suspect that if [the program] were better or more easily understood, more schools would apply for more funds. The cumbersomeness of the process must certainly leave some students out, by virtue of the fact that their administration just doesn’t have the time and money to complete the process.

Kathryn: I think the SLD should consider whether a Form 470 is needed for certain services, such as telephone service. The vast majority of applicants do not have a choice as to whom they will buy local telephone service from and, in many places, the choice of long-distance service also is limited.

If applicants are going to use a contract established by another entity (municipal, county, state, or federal), I think the SLD should consider that they don’t have to file a Form 470. I realize that the posting of the Form 470 for purposes of procurement is one of the "must dos" of the E-rate program, but the world of 1996 is not the world of 2008 in terms of multiple telecom service providers.

Cheryl: I am concerned that not all PIA auditors seem to be trained the same. I always have new schools and usually must have a letter from our superintendent verifying that they are schools as identified by blah, blah, blah and so forth. We had one auditor who would not accept that letter as verification; I had to dig through school board minutes and supply minutes that gave the administrators permission to spend money in the school’s name.

Some of these auditors accept straightforward proof, and others just keep digging and digging and digging. When the E-rate is only one of your hats, that takes up too much of your time.

Jim: Many smaller schools apply only for discounts on plain old telephone service (POTS). Without thinking through the implications of the SLD needing to estimate total requests received through the application process, it sure would be nice if smaller applicants could be pre-approved up to some funding amount and just send a copy of their phone bills to the SLD for reimbursement.

Q: Are you satisfied with the types of products and services that are eligible for E-rate? If not, what changes would you make to the types that are eligible?

Laurie: I would like to see [voice over IP] and video conferencing more generally eligible. The difference between a router, a PBX, and a VoIP controller is beyond me.  We are not encouraged to try leading-edge technologies, because they have not made appearances on the Eligible Services List.

Jim: Since content filtering is required in order to be eligible for discounts on internet access services, it would be nice if content filtering services, hardware, or software were eligible. I’d also like to see scheduling services for distance learning or video conferencing applications become E-rate eligible.


Q: As you might know, the "Two-in-Five Rule" limits internal connections funding (excluding basic maintenance) for any given entity to two out of any five consecutive years–with the goal of providing discounts to more applicants at lower discount rates. From your experience, do you have any sense whether this rule is meeting its goal? Do you have any alternative recommendations for sharing internal-connections discounts with a greater number of applicants?

Bonnie: My impression is that the Two-in-Five Rule adds just one more layer of confusion and reason for denial.

Kathryn: I think the SLD thought this rule would lead to funding for internal connections reaching "middle class" schools, and this is not happening. … Some folks have talked about doing away with funding for internal connections ("Aren’t all the poor schools already wired?"), but I think [Hurricane] Katrina has shown that disasters may require schools to be built or rebuilt. Perhaps statewide, district-wide, consortium-wide attempts at internal connections should be considered in a different category, with a different level of discount applied.

Jim: It seems like much of the fraud, waste, and abuse of the E-rate program involves equipment purchases. If entities were required to contribute a greater percentage toward equipment purchases, there might be less abuse of internal connections applications.Q: What impact would there be to your district or library system if the E-rate program were to be terminated in 2009? Would the goals of your technology plan be attainable?

Bonnie: Oh my gosh–devastating. We are a small library system that relies on taxes for our county and state funding. We were asked to reduce our county budget by 5 percent, and our state funding was reduced by 20 percent last year. I am anticipating a decrease to both sources again this year. To suddenly need a 10-percent increase [owing] to increased communication costs could mean not keeping the doors open at one of our remote library branches.

Cheryl: Would it hurt? I agree with Bonnie–devastating. …Without E-rate [funding], there would be nothing for technology for our schools.

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