Introduction to E-rate 2.0 October 15, 2014

1. Introduction to E-rate 2.0 October 15, 2014

2. Moderator:Noelle Ellerson Associate Executive Director, Policy & Advocacy Presenter:Aleck Johnson Vice PresidentEdTech Strategies, LLC Sponsored by:

3. Logistics: • Remember to phone in to access the audio for today’s webinar.

4. Webinar Participation: • We have allotted time for Q&A, but you can submit questions at any time. • Please use the chat window to submit questions. • Download the presentation at http://goo.gl/BZBgEd

5. Introduction • E-rate 2.0 efforts date to ConnectED initiative (June 2013) • First significant overhaul of E-rate since 1997 • Order establishing E-rate 2.0 released by FCC on July 14, 2014 following a lengthy comment process • Schools, libraries, vendors, consultants all participated • AASA and other groups commented extensively • Labeled as “modernization”

6. Introduction • E-rate 2.0 meets several different demands • Reorient program to focus on broadband • Free up funds to support intra-building connectivity • Goal of $1B/year • Alleviate the demand on the program • Demand has been more than double the available funding • No P2 funded in FY2013 and FY2014 • No increase in funding (yet) as part of E-rate 2.0

7. E-rate 2.0 Summary • Significant and far reaching changes to a number of aspects of the program • Relabeling Priorities to Categories • Changes to Priority 1/Category 1 services • Changes to Priority 2/Category 2 services • Introduction of budgets and funding caps for Category 2 • Updated application forms and technology back end (ongoing)

8. E-rate 2.0 Summary • Significant and far reaching changes to a number of aspects of the program • Changes in discount calculations • Expedited processing of applications • Promoting multiyear contracts • Promoting master contracts (upcoming)

9. E-rate 2.0 Summary • Minor changes • Elimination of technology plan requirements • Document retention requirements extended • Direct invoicing (starting in FY2016) • Encouraging lower pricing from vendors • Item 21s made public • Lowest Corresponding Price enforcement • Low dollar connection streamlining

10. E-rate 2.0 Summary • Minor changes (cont’d) • Signed contract requirements relaxed • Easier deadline extensions • Plain language review • Library-school broadband connections (upcoming) • Tribal outreach (ongoing)

11. Major Changes: Category/Priority 1 • Priority 1 renamed Category 1 • Refocused on broadband • Discounts reduced by 20%/year on voice services (until discounts reach 0%) • Local phone • Long distance phone • Cellular phone

12. Major Changes: Category/Priority 1 • Numerous services eliminated from eligibility • Website Hosting • Email Hosting • Cellular Data* • Paging Service • Custom Calling Features (incl. DID) • Voicemail Service

13. Major Changes:Priority 2/Category 2 • Priority 2 renamed Category 2 • Category 2 refocused on providing broadband access to classrooms (particularly wireless) • Goal of $1B in funding for FY2015 and FY2016

14. Major Changes:Priority 2/Category 2 • New “managed internal broadband services” and caching added as eligible services • Several previously eligible services eliminated • PBXs • PVBXs • Video Components • Servers*

15. Major Changes:Priority 2/Category 2 • Applicants participating in FY2015 and FY2016 subject to a new per student pre-discount funding cap of $150/student over five years • Minimum of $9,200 per school/library • Cap is pre-discount – can spend more, but won’t get E-rate funding beyond cap

16. Major Changes:Priority 2/Category 2 • Per student budgets go away after FY2016 absent FCC action (unless funding committed in FY2015/FY2016) • No guarantees of funding (esp. after FY2016) • Basic maintenance, managed internal broadband services, and caching become ineligible after FY2016 unless the FCC acts to continue their eligibility

17. Major Changes: Discount Calculations • From FY2015 onward, discount calculations are based on a district-wide calculation (rather than a school-by-school calculation) • Urban/rural status now determined by whether majority of entities are rural as defined by new forthcoming tool • Preliminary analysis indicates most rural entities take a discount hit due to new urban/rural tool • Consortia use simple average of members’ discount rates

18. Major Changes: Discount Calculations • Community Eligibility Provision (CEP) officially acceptable • Can use multiplier (currently 1.6) • Max school eligibility is 100% • Can use multiple methods within a district but not within a school • Surveys still acceptable, but no projected eligibility • Can use NSLP forms as surveys now

19. Major Changes: Discount Calculations • Discount rates for C2 reduced at the high end • Highest poverty discount rate is now 85% -- other rates unchanged for C2 • Discount rates for services being phased out (voice) reduced at 20%/year • FY2015 – 20% reduction • FY2016 – 40% reduction • FY2017 – 60% reduction • FY2018 – 80% reduction • FY2019 – phased out entirely • Up to 3 discount rates for one applicant!

20. Major Changes: Faster Application Processing • FCC has set a (nonbinding) goal of processing all “workable” applications by Sept. 1 of the funding year • “Workable” appears to mean timely filed, complete, no additional information from applicant, and no investigation • FCC and USAC working to figure out how to process consortium apps more quickly • Additional unspecified improvements in the works

21. Major Changes: Multiyear Contracts • Multiyear contracts will, after first year, only need to be reviewed if something changes • Recipients of service, cost, services delivered • Applicant will need to file 471 and confirm the continuation of the contract annually • Only applies to contracts of five years or less • NOT a multiyear commitment – still need to file and be approved annually

22. Major Changes: Preferred Master Contracts • Preferred Master Contracts for C2 services will be designated by FCC • Will avoid the 470 process • Will need to be considered as responses to 470s when applicable • Will NOT be in place for FY2015

23. Major Changes: Technology Plans • Technology Plan requirement eliminated • Starting in FY2015 no tech plans will be required for E-rate • May still be state/local requirements for tech plans

24. Minor Changes • Document retention changed to 10 years • This trumps local retention policies • Electronic retention officially approved • Best practice: apply to 2014 onward • “Encouraging” lower prices from vendors • Item 21s made public • Lowest Corresponding Price (LCP) enforcement

25. Minor Changes • Low dollar connection application streamlining • 100 Mbps down and 10 Mbps up for $300/mo. or less • Can skip Form 470 (though local restrictions may apply) • Relaxing signed contract requirement • Must still have legally binding agreement before filing 471

26. Minor Changes • Plain language review of E-rate applications and process • Library-School broadband connections • Should apply for waiver ASAP if needed for FY2015 • Tribal outreach from USAC

27. E-rate 2.0 Summary • Major changes will likely affect application processes and discounts/reimbursements for most applicants • Dollar amounts likely to drop if applicants were receiving discounts on eliminated services (web hosting, email, cellular data) or services being phased out (voice) • C2 funding for intra-building broadband may offset those decreases • New processes (and increased work) likely to mean applications more difficult for FY2015

28. Future Presentations • 10/22/14 – Understanding the New Category 1 Services • 10/29/14 – Understanding the New Category 2 Services Send questions to erate@aasa.org

29. Blackboard & E-Rate • Our Mission: Reimagining Education through Technology • Leading provider of K-12 web hosting • Partner of nearly 1 out of 3 districts in the U.S. • Solutions for all of your education technology needs: • Teaching & Learning • Parent & Community Engagement Find Out How Blackboard Can Help: bbbb.blackboard.com/announcingbbrate

30. Aleck Johnson EdTech Strategies, LLC ajohnson@edtechstrategies.net Questions? Send them to erate@aasa.org