It's January, do you know where your 486 is?

So the new "hey, dummy, you forgot to file a 486" notices have started coming out. I like them. Here are some reasons:

1. Pink envelopes. Love the color-coding.
2. Across the top of the page: "Urgent reminder: Your Form 486 may be late." Yes! The old SLD would have said something like "Form 486 Non-Timeliness Notification" or something. This page grabs you and tells you exactly what's up. OK, it should be in a larger font and not in all caps, but it's still progress.
3. Two pages. That's downright pithy for an SLD document. It should be one page, but again, it's progress.
4. The SLD implemented the FCC order just the way I expected. I'm always amazed at how differently the SLD looks at the FCC's orders. But in this case, this letter is just what I thought the FCC had in mind.

It's also pretty well written, though it gets a little mushy in the 3rd paragraph, which should be the hammer. It says "USAC may reduce your commitment...if your SSD is adjusted." It should say: "Get this form in by 2/15/07, or half your funding is gone, poof!"

E-Rate me

I was just thinking:
The money I pay to my tax preparer is tax-deductible. So why aren't E-Rate consultant fees eligible for E-Rate? Just wondering.

SLD no haberdasher

It seems that the SLD is not doing so well selling HATS. For those of you that don't know, this is the SLD's new outreach campaign, where reviewers come out and try to help applicants which have had trouble getting funding. A wonderful idea.

But at the last board meeting, apparently Mel Blackwell mentioned that about 40% of applicants contacted don't want the help, because they're afraid that it's actually an audit. Now why would that be? Could it be because the HATS visits are conducted by BearingPoint, which also runs the Extended Outreach Site Visits? Both SLD and BearingPoint tooks pains to declare that EOSVs were not audits, but one component of the EOSVs was an investigation of compliance. That's an audit. So now the SLD is sending out BearingPoint again, and again saying it's not an audit, and for some reason, applicants are dubious. Keep in mind that to be considered for the program, the applicants have to have gotten repeatedly burned by the E-Rate program.

If I were an applicant, I wouldn't be eager for a HATS visit, either, for two reasons:

1. I don't always get the right answers from the SLD (though this is constantly approving), so now I'm going to trust the advice of some consultants hired by the SLD who have never worked in a school district or filed an application?
2. The premise of the HATS program seems to be that certain applicants run into a problem when applying, and if we can fix that problem, they'll get funded every year. In my experience, applicants don't make the same mistake twice. Applicants that get denied year after year run into a new problem every year, because there are so many rules in this program, and they are scattered in so many places, and most of them are secret. HATSpeople will have to anticipate next year's error(s).

I do this full time, I spend probably 10 hours a week keeping up on rules and rule changes and rule interpretations, and every time I hit the "Submit" button, I still worry that I'll get tripped up by something stupid. So I'm not sanguine about the ability of BearingPoint employees to anticipate applicants' errors. Still, I suppose any help is better than none.

If the SLD wants to sell HATS, they should use On-Tech's slogan: E-Rate Funding - Guaranteed. Get the FCC FCC to pay someone (preferably not a company that also does audits) to come in and assist the applicant, and then guarantee that the applicant will receive full funding that year for all requests. (Except Priority Two for low-discount applicants, of course.) Applicants would be clamoring to get in.

Don't get me wrong; I think that the HATS program is a positive development. I'm just not surprised that applicants don't want in.

Yet more paper

The E-Rate world is all abuzz: a new piece of paper has entered the process. Basically, the SLD is sending a note to the contact on every 470, reminding her or him to file a Form 471.

What I don't like about it:

1. It reminds applicants to file, but might mislead applicants into filing before the required 28-day bid period has passed. Of course, the online Form 471 won't let you fill in Block 5 until 28 days have passed. [You are filing online, right? You're crazy not to. I mentioned in an earlier posting that the SLD says 80% of paper applications are denied. So if you file on paper, you have a one in five chance of getting any funding.]
2. It feels wasteful to get all that paper for a reminder I don't need.
3. I have a nagging worry that the SLD is going to claim that they have pre-emptively given applicants the 15-day warning required by the Bishop Perry order, meaning they don't have to give applicants who miss the February 7 deadline another 15 days. But I'm not too worried; when I suspect the worst of the SLD, it proves to be baseless.

What I like about it:

1. Communication is good. Warnings are good. Proactive is good.
2. The SLD sent it to the name and address given for the Contact on the 470. The 470 RNL goes out to the contact name, but at the billed entity's address. For my clients, that means an envelope shows up at the district office with my name on it. If someone recognizes my name, they usually send it to me, but a lot of them probably end up in the Mystery File.
3. The envelopes were pink! Those who have been reading for a while have heard me complain about the white envelopes with colored paper inside. For the first time in a while, the envelopes match the paper.

Form 486 crisis

Today I got two more reasons to be hacked off that the online Form 486 is supports only Adobe Reader 5. I've complained in the past about this, but it just keeps getting worse.

First, I was browsing the IRS site, and I was told that my creaky old version of Adobe Reader did not have all the features I would need to see the form I was looking at. This goes beyond the little notice that I get every time I open a PDF, suggesting that I upgrade. When I clicked the "OK" button in the dialog box at the IRS site, it took me to the Adobe site so I could upgrade. So now I have to choose between USAC forms and IRS forms.

Then came the really bad news. I opened up the latest issue of NetworkWorld magazine, and read that there is a cross-scripting vulnerability in all versions of Adobe Reader up to 7.0.8. So if I click on a malicious link, hackers can use Adobe Reader to install software on and take control of my computer delete all my files, use my computer to relay spam or do whatever they want. Adobe is releasing patches, but not for me.

What I feared back in August has happened: With the release of version 8, Adobe is no longer supporting version 5. So I can't patch my computer. And if I want to downgrade a new computer to version 5, I'll have to hope that I have that version on some old CD, because it's no longer available at Adobe's Web site.

It's time. The old online 486 has to go now. I should not have to choose between the security of my computers and being able to use the online 486.

IP address matching in the crosshairs

Here's an appeal I like. First, I just don't see words like "abrogate" often enough. But what I like even better is that a law firm has finally sunk its teeth into the SLD's denial of applications when the Form 470 is posted from an IP address that is identical to the IP address that a vendor invoice has been submitted from. I'm happy about that because it gives me hope that instead of just granting a waiver, the FCC will actually forbid denial of applications based solely on IP address matching. Because matching IP addresses does not prove a rule violation. The appeal lists something like 5 reasons, but for me, there are two:

1. This technique is basically the same as the recently repudiated "pattern analysis." While a matching IP address certainly suggests wrongdoing, it does not prove wrongdoing. I'm all for the SLD using these techniques to decide who gets a Selective Review, but not for denying applications outright. I can come up with all kinds of scenarios where the IP addresses match, but no rule has been broken. Yes, they are all unlikely scenarios, which is why I think matching IP addresses should raise suspicion. But suspicion is not guilt.
2. IP address matching is technically imprecise. Since On-Tech's Web site and email (and this blog) are externally hosted, we have no use for a static IP address, so we didn't pay extra to get one. That means that our ISP can change our IP address at any time. An IP address that had at one time been assigned to us could later be assigned to a service provider.

Whichever SLD employee thought to compare IP addresses from 470s and SPIs should get a raise; it's a good way to red-flag applications. But whoever decided it was enough information to deny applications should take a cut in pay.

Funding for 05-06 finally done

I hear from a reliable source that the final funding wave for 2005-2006 has come out (of course, there are special circumstances like appeals still hanging out there, but basic funding is done). For those of you unfamiliar with the E-Rate process, no doubt your mental calendars are swirling. That's right: funding for services that were to be completed by June 2006 has been approved in January 2007.

It's not as bad as it sounds at first. By and large, the SLD does the humane thing and works on Priority One funding requests first. So most people know about their requests for telecommunications and Internet funding within a few months of the start of the year (and would probably know sooner if the FCC didn't change the rules in the middle of the application cycle (not that I'm complaining, since lately the rule changes have been positive)).

And when it comes to Priority Two equipment purchases, most savvy applicants apply 18 months before the time they actually expect to install. So it's an inconvenience, and creates extra paperwork for everyone (for one thing, networking products change significantly over the course of 18 months, so service substitutions are a routine part of the process for equipment). But those applicants who this week will be funded for 2005-2006 requests have until September 2007 to install the equipment.

But there is one area where it's terrible: Basic Maintenance of Internal Connections. These maintenance funding requests are Priority Two, but they are for services. Technology budgets at most schools and libraries are meager. Many of them do not purchase service contracts on their hardware, and just hope it doesn't start smoking. Others are underutilizing their infrastructure because they can't afford the configuration and maintenance they would need to keep it all running. E-Rate funding for maintenance seemed like an opportunity for applicants in low-income areas, but it just doesn't work, because Priority Two requests are never approved by the start of the funding year, and are often not approved by the end of the funding year. So by the time the E-Rate funding is approved, it's too late to take advantage of the funding for maintenance. It's a Catch-22 that needs to be fixed.

How? Well, the best solution might be to move maintenance into Priority One. That would probably spell the end of Priority Two funding, as all the low-discount applicants get Priority One funding for their pricey service contracts. Would that be bad?

But before they do that, the FCC should clarify what is meant by maintenance. Because right now maintenance is the newest frontier for waste, fraud and abuse, and if it goes Priority One, we'll have a gold rush and accompanying lawlessness.

[Warning: a rant begins building at this point.]
The definition has been getting clearer, but we need to have some network engineers who have worked in schools to sit down with the FCC staff and say, "Here are the types of maintenance contracts we have. Which ones are eligible and why?" After a few days, the FCC staff would understand enough about network maintenance, and the engineers enough about E-Rate rules, that we could get a rational framework. The current rules seem irrational and unclear to network administrators. For example:

1. Network Interface Cards (NICs) are eligible equipment, even if they're in end user equipment, but what about NIC drivers? The IP stack? At what layer of the OSI model does eligibility end?
2. Maintenance on a KVM switch is eligible if all the attached servers are eligible, but what about real life, where a KVM switch is connected to eligible, ineligible and partially eligible servers? Get out your calculator and figure out if it's 7/32 or 9/32 eligible.
3. Your Web filter (ineligible, but required) is causing your firewall to lock up. In order for the firewall to work properly, the Web filter needs to be fixed. Eligible? I suppose not, but I couldn't say for sure.
4. Adding and deleting users from the email server seems to be eligible, but what about adding and deleting users from the user directory? The answers would seem to be:
1. if the directory server is running DHCP in addition to the directory, it's eligible;
2. if it's offering file services in addition to the directory, it's not eligible;
3. if it's offering both DHCP and file services, it's half eligible;
4. if it's offering DHCP, DNS, file and print services, it's half eligible, unless the print services are negligible, in which case it's two-thirds eligible. Maybe.

And there is a more basic problem: when there is a network problem, it is not always caused by an eligible piece of equipment. If a desktop can't get to the Internet, it could be the ISP, the circuit to the ISP, routers, switches, wiring or the desktop (or something else like a DOS attack). If no one can get their email, it could be a problem with the email server, but the problem could be an ineligible network node with a duplicate IP address, or a problem with GPOs on an ineligible Active Directory server. For many network problems, there is no way to tell whether the problem is with an eligible component until the problem is solved. What's a school to do?

Appeal with a twist

I came across an appeal that I liked and disliked today.

First, the thing I liked: the applicant used a telecom broker called "Sir Schmooze A Lot." I can't find the company on the Web, but if it's in an appeal to the FCC, you've got to believe it's a real company.

I disliked the slam against consultants. The appellant complained that if the FCC didn't make the rules clearer, all applicants would be forced to use consultants. I agree it's a shame that a small school which was just trying to get telecommunications and Internet funding, totalling less than $15,000, got busted by a Selective Review, because they did not understand PIA's unusually worded requests, and couldn't guess what the right response was. They didn't break any rules, and they certainly weren't trying to cheat anyone. The fact that they could not prove their innocence does not prove they did anything wrong, but in the upside down world of the E-Rate, you're guilty until proven innocent.

But I didn't like the attitude that consultants are "siphoning off" money from the program. If an applicant doesn't want to hire a consultant, that's fine. That means that the applicants will have to learn the E-Rate rules and follow them. Many applicants have realized that it is cost-effective to hire a consultant. I don't like having to pay all that money to my accountant, but when I look at the effort it would take me to do my own taxes, I realize it's worth paying someone else to do it.

The attitude is more troubling because of the underlying reason that this particular applicant is upset at having to pay for a consultant: for years they got free E-Rate consulting from a service provider. Once that rule violation was discovered, they got a Selective Review, and that's what tripped them up. So if they'd been managing the E-Rate for themselves all along, questions about competitive bidding would not have come up.

I feel bad for all the applicants who got taken in by service providers who acted as consultants. I think most of them didn't know they were breaking a rule. But how ofen does it need to be said? "If a deal sounds to good to be true, it is."

It's hard for me to feel sympathy for an applicant who for years got free E-Rate services by violating the rules, and now complains that honest consultants demand their payment above board.

So while I agree that a small applicant requesting telecom and Internet should not face such a complicated application process and so much scrutiny, don't say consultants are siphoning off money from the program. Are accountants siphoning off tax money?

We've moved!

This blog is now available at blog.on-tech.com. I've been assured the old address will still work.

I am once again master of my domain.

HATS off

Well, the new outreach effort I described back in October has finally been launched. The initiative is being called HATS (Helping Applicants To Succeed), and will apparently be offered to applicants who repeatedly get Selective Reviews or have trouble getting funded. The visits will be done by BearingPoint, only there will be no compliance review. It's really just supposed to be help.

I think it's a great idea, but I wonder how well it will work. The problem is that I think no one involved in the initiative, from the BearingPoint reviewers to Mel Blackwell himself, has ever actually applied for E-Rate funding. Certainly there is a wealth of expertise there, and they will be able to help applicants, but I can't help feeling that what those applicants need is a good consultant. Not that I'm biased or anything.

I'll be curious to see if the HATS reviewers recommend that applicants use a consultant. Of course, with no registration or certification of consultants, the applicant then has to hope that they pick the right consultant.

What I hope the initiative does is make clear to everyone involved how hard it is to apply the E-Rate rules to reality. I think BearingPoint was able to convey some understanding of the applicant perspective to the SLD (and I hope the FCC) through the Extended Outreach Site Visit program. I hope that since these new reviews don't involve compliance checking and do involve actual application advice, BearingPoint will be able to give an even better picture of how difficult the process is.