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Monday, May 14, 2007

Pay it forward

So I was just reading on E-Rate Central's weekly update for service providers that USAC will probably have $1 billion in the bank from funds not spent in previous years. Probably they're just holding it as a hedge against another ADA crisis. That's fine, but as long as they're holding it, they should put it to work.

That $1 billion could fund Priority Two for 2007-2008. So right now, USAC could take a look at Priority Two demand for 07-08, and set the denial threshold. Then every February, USAC could look at the next year's Priority Two requests, look at the excess it has on hand, and determine the denial threshold right then. USAC could announce the denial threshold when they issue Wave 1.

What if they're way off on the denial threshold? Well, if they set the threshold too high, then they can just roll the extra money into next year. If they set it too low, they use the 07-08 Priority Two funding as a cushion, and the following year is leaner.

Imagine how nice it would be for applicants to know right away what the denial threshold will be. But the real winner would be PIA. They would be able to deny all the applications under the denial threshold without even taking a glance at the Item 21 Attachments or doing any kind of processing.

Now if there were only some way to set the denial threshold before the application window opens....

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