What is E-Rate?
What is the Universal Service Fund (USF), what is it for, and where does the money come from?
Who or What is USAC?
Who or What is the SLD?
Is E-Rate a grant?
Who should apply for E-Rate?
Do Early Head Start programs qualify?
Do Migrant programs qualify?
Do Home-Based programs qualify?
How much money can my Head Start program expect to save on telephone service by participating in E-Rate?
Will participation in E-Rate require Head Start grantees to conduct a separate verification of income for parents?
Will my application or records be audited?
Who will audit records?
What staff person(s) within my organization should be responsible for applying for E-Rate?
Where can I find an overview of the E-Rate application process?
What are the start and end dates for the E-Rate funding year?
Is it too late to apply for E-Rate for July 1, 2007 - June 30, 2008?
When should applications or forms for a funding year for E-Rate be submitted?
How often must I apply for E-Rate?
What is a Letter of Agency?
Must I apply for E-Rate every year?
Where do I get the forms to apply for E-Rate?
Is my organization guaranteed reimbursement or discounts?
Do other non-Head Start programs and services my Community Action Agency provides qualify for E-Rate?
Where can I find help to complete forms, technology plans and provide assistance with E-Rate?

Q: What is E-Rate?

A: The Schools and Libraries Program of the Universal Service Fund, commonly known as "E-Rate," provides discounts for telecommunication services (e.g., local and long-distance calling, high-speed lines), Internet access, and internal connections (the equipment to deliver these services) and maintenance of internal connections. E-Rate is administered by the Universal Service Administrative Company (USAC) under the direction of the Federal Communications Commission (FCC). It is one of four support programs funded through a Universal Service fee charged to companies that provide interstate and/or international telecommunications services.

Q: What is the Universal Service Fund (USF), what is it for, and where does the money come from?

A: The USF is supported by the Federal Universal Service Fee that is included on your phone bill under surcharges and other fees.

Prior to the Telecommunications Act of 1996, the Universal Service Fund (USF) operated as a mechanism by which interstate long distance carriers were assessed, to subsidize telephone service to low-income households and high-cost areas. The Communications Act of 1934 stated that all people in the United States shall have access to “rapid, efficient, nationwide … communications service with adequate facilities at reasonable charges.”

The Telecommunications Act of 1996 expanded the traditional definition of universal service - affordable, nationwide telephone service – to include among other things rural health care providers, eligible schools and libraries. Today, FCC provides universal service support through four mechanisms:

High Cost Support Mechanism provides support to telephone companies that serve high cost areas, thereby making phone service affordable for the residents of these regions. Low Income Support Mechanism assists low-income customers by helping to pay for monthly telephone charges as well as connection charges to initiate service. Rural Health Care Support Mechanism allows rural health care providers to pay rates for telecommunications services similar to those of their urban counterparts, making telehealth services affordable. Schools and Libraries Support Mechanism, popularly know as the “E-Rate,” provides telecommunication services (e.g., local and long-distance calling, high-speed lines), internet access, and internal connections (the equipment to deliver these services) and maintenance of internal connections.

Q: Who or What is USAC?

A: The Universal Service Administrative Company (USAC) was appointed by the FCC to administer the USF program, although FCC retains responsibility for overseeing the program’s operations and ensuring compliance with its rules. USAC’s Schools and Libraries Division is responsible for carrying out the E-Rate program’s day-to-day operations.

Q: Who or What is the SLD?

A: Universal Service Administrative Company’s (USAC) Schools and Libraries Division (SLD) is responsible for carrying out the E-Rate program’s day-to-day operations.

Q: Is E-Rate a grant?

A: No. E-Rate is not a grant. It is a discount or reimbursement after services have been received and paid. It is 3 year on-going process. Applicants must plan and reapply each year for the next funding year, while filing the appropriate forms and information requests for the current and previous year.

Q: Who should apply for E-Rate?

A: Generally, any school that meets the Elementary and Secondary Education Act of 1965’s definition of schools is eligible to participate, as are libraries that can receive assistance from a state’s library administrative agency under the Library Services and Technology Act.

The term "elementary school" means a nonprofit institutional day or residential school, including a public elementary charter school that provides elementary education, as determined under State law.

Head Start Grantees are eligible when a state’s definition of elementary education includes Pre-K or when other non-traditional school facilities or children meet requirements for E-Rate eligibility. To find out if your Head Start program is eligible for the E-Rate program, review the E-Rate eligibility table maintained by the Universal Service Administrative Company.

Q: Do Early Head Start Programs qualify?

A: As of this date, we are unaware of any state providing free public elementary education as defined in 20 USC Sec. 7801 to children age 0-2. Some states permit 3 year olds to participate in state Pre-K when vacancies occur. Prior to making application, contact USAC/SLD to determine if your EHS children age 0 to 3 are eligible.

Q: Do Migrant Programs qualify for E-Rate?

A: Migrant Head Start center based programs qualify for E-Rate if the migrant Pre-K center is located in an eligible state. To find out if your Head Start program is eligible for the E-Rate program, review the E-Rate eligibility table maintained by the Universal Service Administrative Company.

Q: Do Home Base Programs qualify for E-Rate?

A: Offices for Home Base staff are likely eligible in eligible states. Home offices or Home classrooms are generally not eligible. To find out if your Head Start program is eligible for the E-Rate program, review the E-Rate eligibility table maintained by the Universal Service Administrative Company.

Q: How much money can my Head Start program expect to save on telephone service by participating in E-Rate?

A: Schools and libraries do not receive direct funding from the program. Instead, they receive discounts on the costs of services provided by vendors. The amount of discount each school or library can receive under the program ranges from 20 to 90 percent and is determined using a matrix designed by FCC, with schools and libraries located in rural and low-income areas receiving the highest discounts from the fund. The USF compensates the schools’ and libraries’ vendors for the amount of the discount. For 2007 – 2008 Head Start programs will likely be reimbursed at the 90% level regardless of the location (rural or urban area).

Q: Will participation in E-Rate require Head Start grantees to conduct a separate verification of income for parents?

A: No. Additional income verification is not required. Head Start Grantees are required to perform income verification prior to the child being selected for Head Start. The Head Start Performance Standards require at least 90% of enrolled children be at or below poverty guidelines. The income verification Head Start Grantees conduct meets or exceeds the verification required for the National School Lunch Program (NSLP). Head Start Grantees may automatically enroll children in the NSLP based on the income verification conducted prior to enrollment. See ACYF-IM-HS-95-29 concerning Head Start’s automatic enrollment in the free lunch program.

Q: Will my application or records be audited?

A: Oversight of the Schools and Libraries Program has increased because of complaints the FCC Office of Inspector General (OIG) has received alleging improprieties within the program. The alleged improprieties include the submission of false claims, failure to comply with appropriate procurement regulations and laws, conflict of interest, forgery and securities related offenses. In order to maintain program integrity, the OIG is working with local and federal law enforcement entities to investigate the complaints and follow-up with prosecution were appropriate. Furthermore, the OIG has developed the USF Strategic Audit Plan to provide overall goals and implementation strategies for oversight of this program. The process is described in the Audit of Beneficiaries Fact Sheet.

Q: Who will audit records?

A: Beneficiary audits may be performed by USAC internal audit staff, the FCC Office of Inspector General, Inspector General, Offices of other federal agencies, or a firm under contract to USAC or the FCC. Please feel free to contact the USAC Internal Audit Department at (202) 776-0200 if you have any concern as to the proper identity of any individual contacting you regarding an audit. Typically a beneficiary will be contacted by USAC two to three weeks prior to the start of an audit to assure that the appropriate personnel and documentation will be available. The anticipated duration of an audit can vary depending on the quantity, size, and dollar value of the applications involved.

Q: What staff person(s) within my organization should be responsible for applying for E-Rate?

A: The person ultimately responsible is the person authorized to sign or certify the forms submitted to USAC/ SLD however E-Rate impacts several systems within Head Start.  Think in terms of a team being responsible for E-Rate.  The team includes the stakeholders within your organization who provide input into the Technology Plan (HR, Fiscal, IT, Leadership etc.). A consultant can be hired to submit forms on your behalf; however, USAC/SLD requires a letter of agency.

The authorized person on the Form 471 - the person whose signature appears in the Form 471 Item 38 - certifies that he or she is the person authorized to submit and certify to the accuracy of the application. This person must be authorized to represent any and all of the entities for which discounts are sought in the funding requests featured on the application. During its review of the Form 471, the SLD may require copies of the documentation that confirms this person's authorization to represent all of the entities featured on the Form 471.

The evidence that establishes this authorization - and therefore, that establishes the relationship between the authorized person and the entities featured on the form - is generally a Letter of Agency (LOA).

Q: Where can I find an overview of the E-Rate application process?

A: The E-Rate Application Process Flow Chart provides Head Start staff with a brief overview of the E-Rate application process. Contact Head Start Knowledge and Information Management Services at 1-866-763-6481 if you need assistance.

Q: What are the start and end dates for the E-Rate funding year?

A: The funding year begins July 1 and ends June 30 however there are exceptions to the end of the funding year.

Q:  Is it too late to apply for E-Rate for July 1, 2007 - June 30, 2008?

A: Yes. The deadline was January 10, 2007 for applying for E-Rate for July 1, 2007 - June 30, 2008.

Q:  When should applications or forms for a funding year for E-Rate be submitted?

A: Applications are filed each year. Now is the time to learn, train, prepare, and begin work for 2008-2009.

Form 470 (Services Requested) (Oct-Jan) Form 470 must be filed at least 28 days prior to filing Form 471. The last date to file Form 470 for the 2007-2008 year was January 10, 2007.
Form 471 (Services Ordered) (Nov-Feb) Each year a filing window for Form 471 generally begins mid November and continues through the first week in February prior to the start of a funding year. For funding year July 1, 2007 to June 30, 2008 the window for Form 471 was November 14, 2006 through February 8, 2007.
Form 486 (Services Confirmed) (July – June once services begin) Form 486 is filed once services begin usually in July. The Form 486 must be postmarked no later than: 120 days after the Service Start Date featured on the Form 486, or 120 days after the date of the Funding Commitment Decision Letter, whichever is later.
Forms 472/474 (Billed Entity Reimbursement/Service Provider Invoice) (July – June once services are received) Form 472 should be filed after services are received. Form 474 is an Invoice, submitted to USAC for the services you have received.

Q:  How often must I apply for E-Rate?

A: Applicants must apply each year. The process requires applicants to file more than one form. The forms are filed over a period of more than a year. Applicants must also respond to letters and other correspondence from the SLD and their service providers.

Q:  What is a Letter of Agency?

A: The authorized person on the Form 471 - the person whose signature appears in the Form 471 Item 38 - certifies that he or she is the person authorized to submit and certify to the accuracy of the application. This person must be authorized to represent any and all of the entities for which discounts are sought in the funding requests featured on the application. During its review of the Form 471, the SLD may require copies of the documentation that confirms this person's authorization to represent all of the entities featured on the Form 471.

The evidence that establishes this authorization - and therefore, that establishes the relationship between the authorized person and the entities featured on the form - is generally a Letter of Agency (LOA).

Q: Must I apply for E-Rate every year?

A: Yes. You should apply each year your program is eligible to receive services. Failing to apply means you will not receive discounts for the program year.

Q: Where do I get the forms to apply for E-Rate?

A: It is recommended you apply on-line. Applicants can use the USAC web site to file required forms, certify forms, and check application status.

Paper copies of all the required forms may be downloaded from the USAC web site.

Q: Is my organization guaranteed reimbursement or discounts?

A: No. Funds are not obligated merely because of an application. A Funding Decision Commitment Letter (FDCL) will be sent by USAC/SLD which specifies the amount of money a Head Start program may anticipate saving should the Head Start Grantee fulfill its obligations and meet deadlines.

Q: Do other non-Head Start programs and services (e.g. energy, homeless shelters or housing, health care, day care, adult education, weatherization, food distribution, job training etc), my Community Action Agency provides qualify for E-Rate?

A: Some of the programs your Agency supports such as rural health clinics and support for the low income families may be eligible under programs administered by USAC. Please contact USAC to determine eligibility or how your Community Action Agency may find additional assistance for your community.

USAC administers Universal Service Fund (USF) programs for high cost companies serving rural areas, low-income consumers, rural health care providers, and schools and libraries. The Universal Service Fund helps provide communities across the country with affordable telecommunications services. The Universal Service Fund (USF) is one fund with four programs.

The four programs are:

High Cost - This support ensures that consumers in all regions of the nation have access to and pay rates for telecommunications services that are reasonably comparable to those in urban areas.
Low Income - This support, commonly known as Lifeline and Link Up, provides discounts that make basic, local telephone service affordable for more than 7 million low-income consumers.
Rural Health Care - This support provides reduced rates to rural health care providers for telecommunications and Internet services so they pay no more than their urban counterparts for the same or similar telecommunications services.
Schools & Libraries - This support, commonly referred to as E-rate support, provides affordable telecommunications and internet access services to connect schools and libraries to the Internet. This support goes to service providers that provide discounts on eligible services to eligible schools, school districts, libraries, and consortia of these entities.

Q: Where can I find help to complete forms, technology plans and provide assistance with E-Rate?

A: The Head Start Knowledge and Information Management Services (HSKIMS) provides telephone support at 1-866-763-6481.

The Universal SErvice Administrative Company Schools and Libraries Program help desk can be contacted by mail, email, fax or telephone. Contact information is found at:

Schools and Libraries Program
Universal Service Administrative Company
Schools and Libraries Program
P.O. Box 7026 Lawrence, KS 66044-7026
Toll-Free: (888) 203-8100
Fax Toll-Free: (888) 276-8736
Via E-Mail Web site: http://www.universalservice.org/sl