Letter of Agency for E-rate

E-rate is a federal program established by the Telecommunications Act of 1996 to promote Universal Service for schools and libraries by providing billions of dollars annually in discounts (or subsidies) for telecommunications services. This program rebates a portion of the cost of certain telecommunication services, related equipment, and related technical services. The Corporation for Education Network Initiatives in California (CENIC) will be administering the statewide consortium to apply for subsidies for public libraries in California on behalf of Califa acting as the aggregator for the California State Library. Under E-rate regulations, CENIC, as the consortium lead, must have a signed Letter of Agency (LOA) from each of the participating library jurisdictions, systems or branches that CENIC lists on its FCC Form 471 (the E-rate application).

Letter of Agency for CTF

The California Teleconnect Fund (CTF) is a California public purpose program funded by a surcharge on phone bills administered by the California Public Utilities Commission. The CTF program provides discounts to schools, libraries, community colleges, hospitals and health clinics and community-based organizations for eligible telecommunications services.

E-rate and CTF FAQs

Participating in CENIC’s E-rate and California Teleconnect Fund (CTF) Consortium

CENIC applies for E-rate discounts and Califa applies for CTF discounts for all of the circuits CENIC orders to connect libraries, as identified in the jurisdictions’ signed Letters of Agency and in signed contracts with Califa. With the E-rate discount, jurisdictions will have the funds credited in the fiscal year after the year the circuits are first installed. The discount is in arrears due to the reimbursement mechanism used by the federal government.

How will the E-rate process be handled?

CENIC will handle all aspects of the E-rate process, including filing all E-rate forms (470, 471, 486, 472, etc.) on behalf of consortium members for the new broadband services identified through CENIC’s bid process. However, libraries who wish to receive E-rate discounts on circuits to connect to CalREN must complete a Letter of Agency (LOA). CENIC will also respond to questions, if any arise through the Program Integrity Assurance (PIA) review, regarding these broadband services. The PIA is a process used by USAC (Universal Service Administrative Company) to review applications for compliance with program rules and policies. During this process, USAC reviews the information submitted on Form 471 and may contact the applicant with additional questions prior to awarding funds.

Libraries who are currently applying for E-rate discounts are encouraged to continue to do so until they have connected to CalREN or if they are seeking funding for other eligible services. See below.

How do E-rate reimbursements work?

As soon as the library is connected, the library is responsible for paying the full undiscounted price for CENIC service from the start of service through the following June 30. Libraries are billed quarterly as follows: 

  • July-Sept connectivity: bill arrives Oct/Nov
  • Oct-Dec connectivity: bill arrives Jan/Feb
  • Jan-Mar connectivity: bill arrives April/May
  • Apr-June connectivity: bill arrives July/Aug

On the following July 1, the library is responsible for paying full undiscounted price through the next June 30—or until reimbursements for the first year of service become available—on a quarterly basis as described above.

This means, if you connect in September, you are responsible for paying for nine months of service at an undiscounted rate; on July 1, you are then responsible for paying for up to a further 12 months of service at an undiscounted rate. Libraries continue to be billed at the full undiscounted rate during this second year until reimbursements become available.

E-rate reimbursements (and CTF unless applied directly) do not become available during the fiscal year in which service begins. Typically, reimbursements first become available during the fiscal year following the start of service and they may not be available until the end of that year.

This means, if you connect in September, typically you will wait at least nine months and up to 21 months before receiving reimbursement for the first nine months of service and before you no longer have to pay the full undiscounted rate for service.

Please note: It is possible that reimbursement may come later than the timeline outlined here. We cannot guarantee that the first reimbursement will be provided during the fiscal year following the start of service.
Example:

CENIC service is live in September 2016. At that time, the library must begin paying undiscounted rates for service covering the period September 2016-June 30, 2017. On July 1, 2017, the library must begin paying undiscounted rates for service covering the period July 1, 2017-June 30, 2018.  The library will be billed quarterly.

Reimbursements for the first year of service (2016-2017) will not be available during the 2016-2017 fiscal year. Reimbursements are anticipated to become available in the 2017-2018 fiscal year, but they may not be available until the end of that year (e.g. June 2018).

A library that connects in September 2016 will pay undiscounted rates for service for at least nine months and up to 21 months (and possibly more) before any reimbursement is received.

It is possible that reimbursement may come later than the timeline outlined here. If you connect in the 2016-2017 fiscal year, it is possible that the reimbursement for the first year of service will not arrive until after June 30, 2018.

Reimbursements for the second year of service (2017-2018) should become available during the 2018-2019 fiscal year. The timing of the reimbursement cannot be predicted and reimbursements may not arrive until the end of the fiscal year.

The same pattern will follow thereafter.

When the E-rate and CTF reimbursement becomes available and received by CENIC, it is then forwarded to Califa. At that time, the library jurisdiction then has the option to either a.) receive E-rate and CTF reimbursements for the whole previous fiscal year in one reimbursement check from Califa - OR-  b.) ask Califa to hold the reimbursement amount and apply it to future invoices.    

Will the E-rate and CTF discount rebates show up as a single check or as separate checks? If separate, what will be the difference in timing between when the two arrive to us?

E-rate and CTF discounts will usually come together in one lump sum to Califa. Once Califa receives the funds, Califa will contact libraries to choose how they wish to receive the funds. Libraries may either receive the reimbursement funds in one lump check - OR - have Califa retain the funds in an account to apply to future library bills.

Will the E-rate and CTF discounts continue to be a rebate-based system even beyond the first year, or will they start to become incorporated into the invoices from CALIFA such that libraries will only have to pay their discounted portions moving forward?

Each year, beginning July 1, you will pay the undiscounted amounts for service covering the period of July 1 - June 30. After the first year of service, reimbursements will arrive each year. The timing of the reimbursements cannot be predicted and they may not arrive until the end of the fiscal year.

Will libraries still need to file for E-rate discounts?

This consortium project is specifically for high-speed broadband services to connect libraries to CalREN. If a library would like to receive E-rate discounts for other eligible services, such as internal Wi-Fi or voice/phones, then that library must file separately for these other eligible services in order to receive E-rate discounts on them.

Will libraries participating in this E-rate consortium need to comply with Children’s Internet Protection Act (CIPA) requirements?

The broadband services being procured through this E-rate consortium are telecommunications circuits, which are not subject to CIPA. Therefore, if the library is only receiving E-rate funded services through the consortium, it will not be subject to the CIPA compliance requirements. If the library is separately applying for E-rate on other services, the library will need to follow E-rate guidelines regarding CIPA compliance on those services. Libraries connecting to CalREN will also receive Internet services from CENIC. There is no CIPA compliance requirement for receiving Internet access through CENIC.

Are there any restrictions on the use of the circuits purchased in this program? The circuits are to be used by libraries and their patrons. E-rate guidelines state that E-rate funded services for libraries should be used to support activities that are integral, immediate, and proximate to the provision of library services. We advise all libraries to follow USAC guidelines (http://www.usac.org/sl/about/program-integrity/appeals-guidelines.aspx) with respect to the use of circuits purchased through the consortium. All activities that occur on library property are presumed to be integral, immediate, and proximate to the provision of library services to library patrons.

What about non-recurring charges (e.g. installation charges)? Will these be included in the E-rate consortium application?

Yes, all non-recurring charges will be included in the E-rate consortium application. Please note that these costs are eligible for E-rate discounts, but they are not eligible for CTF discounts. Libraries will also need to complete a separate LOA for the California Teleconnect Fund.

Will libraries be able to receive California Teleconnect Fund (CTF) discounts on broadband services?

Yes, in addition to applying for E-rate discounts, Califa will apply for CTF discounts on these recurring circuit charges for consortium members. The application process for CTF discounts is much simpler than for the FCC’s E-rate program. Your organization only needs to complete a California Public Utilities Commission’s (CPUC) LOA. Califa will then submit your signed LOA when it applies for CTF discounts for all libraries in the consortium.

What steps does my library need to take to participate in the E-rate consortium?

To participate in CENIC’s E-rate consortium for discounts on the circuits ordered by CENIC, the jurisdiction must:

  • Sign letters of agency (LOA’s) authorizing CENIC to apply for CTF and E-rate discounts on the jurisdiction’s behalf.
  • Obtain and/or provide to CENIC your FCC Registration Number or FRN. Note: some jurisdictions may already have an FRN for other purposes. If so, another FRN is not required to participate in CENIC’s E-rate consortium. See instructions below on locating or obtaining an FRN.
  • Obtain and provide to CENIC a USAC (Universal Service Administrative Company) Billed Entity Number (a BEN). Note: some jurisdictions may already have a BEN. See instructions below on obtaining a BEN.
  • USAC also assigns a unique identifying number to each eligible entity that participates in the Schools and Libraries Program, and each branch or location to receive service must have an Entity Number. If a site is both the billed entity and the eligible entity receiving service, the BEN can be used for both and a separate entity number is not required. Use the same instructions below on obtaining a BEN for each location that receives services.
  • Set up an account with USAC’s E-rate Productivity Center (EPC), as outlined below.

How do I find or obtain an FCC Registration Number (FRN) if my library does not have one?

The billed entity must be registered with the Federal Communications Commission, and must have an FCC Registration Number.

You may either search for your organization’s FCC Registration Number on the FCC website using the link below for an Advanced Search or call the FCC’s Help Line.

https://apps.fcc.gov/coresWeb/advancedSearch.do?btnRefine=true

FRN Help Line: 877-480-3201 (Mon.-Fri. 8 a.m. to 6 p.m. ET)

If using the website, you will need a few identifying parameters in order to search for your organization. Be sure you are on the Advanced Search screen. In the “Search by Registered Business” section, use the drop-down menu to change Business Type to “State or Local Agency.” Then, in the “Search by Contract” section, for “City” type in the name of the city in which your main library is located. For “State” use the drop down menu to select California. Then click on the Search button.

This should provide you with a list of all entities in your city with FCC Registration Numbers. If you have an FCC Registration Number, you should see it listed.

If you do not have an FCC Registration Number, you may request one by completing the online form at this website:

https://apps.fcc.gov/coresWeb/regEntityType.do

Under “Registration Type” choose “A business” and “Yes,” then click on the “Continue” button.

There will be a simple form to complete. Select your Business Type as “State or Local Agency” and Subtype “State or Local Commission.” Complete the requested contact information and create a password.

Additional information is available at:

https://apps.fcc.gov/coresWeb/publicHome.do?faq=true

USAC Billed Entity Number (BEN) and individual site entity numbers:

The Billed Entity Number is assigned to the agency that officially pays the bills for your library. In some instances, it is the library or library jurisdiction itself, or it may be a city or local government. Each jurisdiction will need to have or request a Billed Entity Number. In addition, each branch or location that will receive service must have a Billed Entity Number. Each Billed Entity must also have an account in USAC’s E-rate Productivity Center (EPC).

You may call the Universal Service Administrative Company (USAC) to ask for your entity number or to request new entity numbers. The helpline number is: (888) 203-8100. In the main menu, select 0 to speak directly with USAC staff. Please be sure to have the following information readily available when you call:

  • Entity's legal name (this must be 64 characters or less, so use abbreviations if necessary)
  • Physical address (this cannot be a PO Box and must be 49 characters or less, so use abbreviations if necessary)
  • Mailing address (if different than physical address; mailing address CAN be a PO Box)
  • Telephone number
  • Fax number
  • Sector (public, private, religious)
  • County name
  • Email address (a generic email address for the entity itself, not for a specific person)

More information may be obtained at this website:

http://www.usac.org/sl/applicants/beforeyoubegin/entity-number.aspx

E-rate Productivity Center (EPC)

Even if your organization already has a Billed Entity Number and an FCC Registration Number, you will also need to have access to the new E-rate Productivity Center (EPC - pronounced “Epic.” If you do not have access, you may call the helpline at (888) 203-8100 to request access.

NOTE: If your organization applied for E-rate funding in 2015, USAC has already automatically created an EPC account for the person who signed the Form 471. In EPC, this person is referred to as the “Account Administrator.” If USAC has identified someone as the Account Administrator for your organization, USAC either has already sent or soon will send that person instructions on how to set up accounts for access to EPC. Please follow the USAC instructions for access to EPC.

CENIC will provide additional guidance on how to establish your entity’s participation in the consortium in the EPC portal very soon. If you do not receive additional information within the next month via email, please check back at USAC’s website (www.usac.org) or send a request to broadband@caifa.org for further instructions.