State E-Rate Program

DATE:December 10, 2012
FROM:Flint Waters, State Chief Information Officer
SUBJECT:State E-rate Program - $829,600 Reimbursement Loss
CC:Office of the Governor

During an ETS review of prior E-Rate submissions an apparent error was identified costing the State of Wyoming a loss in Federal reimbursements. Below is a good faith estimate of the events pending more detailed review with input from all involved parties.

  • Prior to the 2011 2012** Legislative Session, the responsibility for E-Rate was shared.  The Wyoming Department of Education (WDE) would complete the technical application for E-Rate funding.  The Director of Department of Administration and Information would then certify the funds transfer process of the E-Rate application and submit it to Universal Service Administrative Company (USAC).

  • During the 2011 2012** Legislative Session, hearings of the Joint Appropriations Committee identified concerns surrounding the E-Rate program and the legislature moved the technical application responsibility to ETS.

  • In April 2012, the application documentation for E-Rate submission was delivered to ETS by WDE in compliance with the shift of this responsibility in the previous legislative session. During an ETS review of prior reimbursement submissions a shortcoming was identified.

  • In September 2011 March 2012*, WDE completed the technical application for E-Rate reimbursement. The construction costs associated with the Qwest Metro Optical Ethernet (QMOE) component in Amendment Four of the CenturyLink contract, which deploys high speed broadband connections to Wyoming schools, was not included in the E-Rate application preventing the State from receiving an estimated $829,600 in reimbursement. These costs can no longer be submitted for reimbursement.

  • With the transfer of the responsibility for the E-Rate application to ETS, steps have been taken to ensure this does not occur in the future.
*Updated during the Joint Appropriations Committee meeting on December 10, 2012.
**Updated during collaborative review with the Department of Education.

Section 325.  E-rate Excess Revenue Funds
Manage State E-rate application submission

Since 1996 Wyoming has been a participant in the Schools and Library Program of the Universal Service Fund - E-Rate program which provides Federal reimbursement to States for the expansion of Internet capacity for schools and libraries.  

ETS conducted an evaluation of the duties and responsibilities necessary to manage the state E-rate application submissions and determined a position would be necessary. ETS re-purposed and staffed an existing position to assume the E-rate reporting responsibilities. All E-rate reimbursements are deposited into the School Foundations account. The E-rate Form 470 was posted on September 28, 2012.  

The Universal Service Administrative Company (USAC) window to submit the 471 E-rate application typically opens in November and closes in February. The application window varies from year to year depending on the release of the approved Eligible Service List and approval for any program changes. For this year, the application window will be open for 93 days: opening on December 12, 2012 and closing March 13, 2013. Any network cost projections should be completed before or during this window. The E-rate funding year is based on the fiscal year: July 1st through June 30th.

After reviewing the FY 2012 State E-rate application, it was found that a Metro Ethernet (ME) request was made for seventeen school districts in which fifteen were new requests. The new ME circuit connections monthly charges were included in the reimbursement request. The reimbursement request for the non recurring charges (NRC) and one time special construction (OTSC) charges were not included. Based on available documentation, an estimate of approximately $829,600 was calculated for potential reimbursement that could have been requested.

QMOE School Districts:
  1. Albany
  2. Campbell
  3. Carbon #1
  4. Carbon #2 (only a few PL ME)
  5. Converse #1
  6. Converse #2
  7. Fremont #1
  8. Fremont #25
  9. Johnson
  10. Laramie #1
  11. Natrona
  12. Park #6
  13. Sheridan #1
  14. Sheridan #2
  15. Sweetwater #1
  16. Sweetwater #2
  17. Teton
  18. Uinta #1
  19. Weston #1 (limited to only a few PL ME)

The E-rate discount is the amount of funds USAC commits to pay an eligible entity for eligible services. The discount rate is determined by the eligible entities National School Lunch Program numbers, the overall discount on eligible services can be anywhere from 10% -90%.

5 Year History on Funding



















Requested is what was applied for on the Form 471, committed is what USAC paid or said they would reimburse.