1. Back to the New Basics Schools and Libraries Division
Eligible Services
Back to the New Basics
Schools and Libraries Division
Washington, DC • Orlando • Boston • New Orleans • Cleveland • San Francisco • Phoenix
September/October 2007

2. Overview Categories of Service Eligible Services List (ESL)
Proposed ESL Changes
Special Eligibility Conditions
Item 21 Attachments
Service Substitutions
Top Reasons for PIA Calls

3. Eligible Services Four categories of service Priority 1 (funded first)
Telecommunications Services
Internet Access
Priority 2 (starts with neediest applicants)
Internal Connections
Basic Maintenance of Internal Connections

4. Telecommunications Service
The transmission, between or among points specified by the user, of information of the user’s choosing, without change in the form or content of the information as sent and received.
Examples: ATM, T-1, Centrex, Local and Long Distance Telephone Service, Cellular Service and Paging Service
Rule of thumb:
USAC funds the various types of services
USAC does NOT fund end-user equipment - e.g., telephone sets

5. Internet Access
Basic conduit access to the Internet or for services that are an integral component part of basic conduit access.
Examples: T-1, DSL, DS-3, and Wireless service
Eligibility also extends to and Web hosting services
Rule of thumb:
USAC funds the conduit to the Internet
USAC does NOT fund content

6. Internal Connections
Components at the applicant site that are necessary to transport information to the school or library.
Examples: Access Points, Routers, Switches, Hubs, Wiring, PBXs and Codecs
Rule of thumb:
USAC funds items that get the information to the classroom or room in the library
USAC does NOT fund end-user equipment such as telephones (including IP telephones) or laptops

7. Basic Maintenance of IC
Ensures the necessary and continued operation of eligible internal connection components at eligible locations.
Ex: Repair and upkeep of eligible hardware, wire and cable maintenance.
Rule of thumb:
USAC funds basic technical support of eligible
hardware.
USAC does NOT fund end-user support such as a student calling a help desk for technical assistance.

8. Eligible Services List
Posted on USAC website
Provides guidance to applicants and service providers on the eligibility of products and services under E-rate
Organized by category of service
Revised and updated each year in advance of the application window

9. Eligible Services List
Five sections
Telecommunications Services
Internet Access
Internal Connections
Basic Maintenance of Internal Connections
Miscellaneous
Three special areas with additional information
Special Eligibility Conditions
Glossary
Index

10. Eligible Services List
ESL approval process
USAC supplies suggested changes to the FCC by June 30
FCC issues draft ESL for comments and reply comments
After reviewing comments and making any necessary changes, FCC issues final list for upcoming funding year
Funding year application window opens 60 days after ESL issued (unless rule waived)

11. ‘08 Proposed ESL Changes Centrex as basic phone service
How distance learning and video conferencing may be eligible as Internet Access
A definition of eligible web hosting
“Failover” products or services added to the Other Miscellaneous Ineligible Components section as ineligible

12. Telecom or Internet Access?
This is a direct link between two eligible schools, also known as a point to point connection.
This is only eligible as a Telecommunications service and must be provided by an eligible Telecommunications carrier.
Why? Because it is not being used to access the Internet.

13. Eligible as Internet Access?
Configuration:
1x T-1 between HS and Elem
1x T-1 from Elem to the Internet
Eligibility:
Eligible at Telecom
Conditionally Eligible in IA
IA Conditions:
Must be used as basic conduit access
Must be the most cost effective means of accessing the Internet and documentation to support its cost effectiveness

14. Eligible as Telecom?

15. Special Eligibility Conditions
Ancillary use
Cost allocation
Cost allocation for file servers
Eligible users and locations
Internet Access with ineligible features
Leased Wide Area Network (WAN) infrastructure (On-premise P1 equipment)
WAN vs. LAN components

16. Ancillary Use
In general, if a product or service contains ineligible functionality, that functionality must be removed through cost allocation
Functionality ancillary to principle use OK
Price cannot be determined separately
Combined offering is most cost-effective solution without regard to the value of ineligible functionality

17. Cost Allocation
If a product or service contains both eligible and ineligible functionalities or uses, the ineligibles must be cost-allocated out
Clear delineation must exist between eligible and ineligible components
Several methods can be used, but must be based on tangible criteria that yield a realistic result
Price for eligible portion must be most cost-effective means of receiving the eligible service

18. Cost Allocation – File Servers
File servers can be used simultaneously for multiple purposes, some eligible and some ineligible
Simplified method of cost allocation available based on simple averaging of the different functions

19. Cost Allocation – File Servers
Example – file server used as
server (eligible)
Firewall server (eligible)
Storage of non- end user files (ineligible)
Two out of three functions are eligible, so 67% of cost is eligible

20. Eligible Users/Locations
Eligible users and locations are those that are involved in activities that are integral, immediate, and proximate to the education of students or the provision of library services to patrons
Employees of a school or library
Non-instructional facilities (NIFs)
Wireless telephone services (bus driver delivering children to/from school, library staff in bookmobile, teachers/staff on field trip)

21. Internet Access + Ineligibles
Examples of ineligibles that may be included in Internet access service offerings but should be cost allocated
Specialized content
Caching services
Filtering services

22. Leased WAN Infrastructure
WAN network facilities may only be leased, not owned, by applicants
Limitations on initial implementation costs for service provider infrastructure
Other eligibility conditions
Exclusive access limitations
Amortization requirements
WAN Fact Sheet has detailed information

23. WAN vs. LAN WAN = Wide Area Network LAN = Local Area Network
Rebuttable presumption – a connection is not an Internal Connection if it crosses a public right-of-way
LAN is considered Internal Connections
WAN is not Internal Connections because it runs from demarcation point at school or library to a point outside

24. Item 21 Attachments
Form 471, Item 21 requests a description of services, including a breakdown of components, costs, manufacturer make and model number
Can be submitted online
ed (scanned) or paper submission can be a contract, product description, spec sheet, or other document containing the necessary information

25. Service Substitutions
What is a service substitution?
What are the benefits of a global service substitution?
What are some helpful filing tips?

26. Service Substitution
A service substitution is a change in the products and/or services specified in the Form 471.
Certain conditions must be met:
Same functionality
Doesn’t violation contract provisions or state and local rules/regulations
Doesn’t increase the % of ineligibles
Within the scope of the original Form 470/RFP

27. Global Service Sub
Involve a product and/or service that is being discontinued, has a model number change, or is being replaced.
The manufacturer or service provider may submit notification to USAC that the product or service is being changed, along with a listing of one or more replacement products or services.

28. Helpful Service Sub Tips
Refer to your original Item 21 attachment. The items and dollars from the From: section must reflect those in your Item 21 attachment.
Be sure to include the dollar amounts, quantities and the make and model of equipment of the From: and To: sections.
If one product is being substituted for several FRNs, be sure to include the changes in quantity and the change in dollars (if any).

29. Helpful Service Sub Tips
Be sure to include your contact information: e.g., name, phone number, fax and .
If substituting multiple products, include a spreadsheet.
Digital copies are best (faxes can be hard to read)
Send to USAC via Submit a Question

30. PIA Contact Reasons “Other” or “Misc” charges
Item 21 attachment includes a summary phone bill or quote that includes the following terms, “other, miscellaneous, fees, other charges and credits, and surcharges.”
Find the page(s) where these charges are itemized and include them in your Item 21 attachment.

31. PIA Contact Reasons Mixed bucket
Mixed bucket requests are requests that include services from more than one category of service
If requesting a service such as cellular service with Internet service, be sure to post for both services on your Form 470 (e.g., Blackberry services).

32. PIA Contact Reasons Multi-year on-premise equipment
On-Premise equipment spans multiple years
If you have answered the On-Premise questions in a prior year, you may refer PIA to your prior year’s FRN or application.

33. PIA Contact Reasons Generic or incomplete responses
General make and model information only
Say “Company X’s D1542 router,” not “high speed router.”
BMIC request noting maintenance on “eligible products and services.”
Be sure to provide the make, model and quantity for all equipment being maintained.

34. PIA Contact Reasons Generic or incomplete responses (cont.)
The type of phone service is listed but there is no line count.
Provide the number of lines when submitting the Item 21 attachment.
Digital Transmission Services request doesn’t include bandwidth
Provide the speed of the services being provided such as 8mbps or 100mbps…

35. PIA Contact Reasons Missing server functionality information
Requesting a File/Network/Web server without stating the functionality
State the specific functionality in your Item 21 attachment, such as DHCP, DNS, Proxy,
This applies for both IC and BMIC requests

36. Questions?