Better late than no-waiver

Another batch of remands today. Kind of boring: 13 cases of applicants cancelling funding requests without meaning to. (OK, so some of the applicants are claiming that they never did cancel the request and it was all USAC's fault. Whatever.) Only two things struck me about the order.

First, while I doubt that this order will be used as a precedent in many cases, if it is, it will probably be referred to as the Jingoli Order. Not as good as Bishop Perry or Academia Discipulos, but it has a nice Jersey ring to it.

Second, while at least one of the appeals (Nemaha) was filed over 4 years ago, one was received as recently as May. It gives me hope that some of the appeals I have languishing over at the FCC will get a response this year.

Online BEAR: thumbs up!

Well, I feel like we've run a pretty good test of the Online BEAR, and it gets thumbs up around here. It's a solid Web app, probably USAC's best.

Things I like:

1. A surprising number of service providers were ready to use the system.
2. I can use the browser Back button.
3. The list of invoices is great, and having the invoice numbers be hyperlinks is good.
4. Having the name of the certifiers be a link providing contact info is sublime.
5. You can right-click on a link and pop it open in a new window, cut and paste back and forth, etc., and the thing doesn't break.

Things I don't like:

1. The validation subroutine should be robust enough to strip out commas, dollar signs, spaces, etc.
2. You can't cancel an invoice once you've submitted it.
3. You can't amend an invoice once you've submitted it.
4. Service providers can't amend an invoice before approving it.
5. The notification emails are useless. All notifications should include FRN, BEN and SPIN at the very least. It would be nice to have applicant and service provider name, as well as the amount. It would also be nice if the "View BEAR Form" link at the bottom of the email actually worked. [I've heard that some people see the login screen when they click that link, but I just get redirected back to the SLD main page. Why log in? Is a completed BEAR some kind of secret? As I griped in items 3 and 4, no one can change the form once it's submitted. Shouldn't John Q. Public be able to see it at that point?

Numbers 3 and 4 should be on the list of features for the next upgrade. As it stands now, I end up cancelling a lot of invoices because the service provider doesn't agree with my numbers. They should be able to send me a note saying, "Cut the pre-discount by $5," then I change and resubmit. Even better, the SP should be able to change the pre-discount amount, certify, and bounce it back to me to re-certify.

But let's hope that before the next upgrade, this silly SP certification of BEARs goes away.

Bells and whistles I'd like to see:

1. After I log in and choose to start a new form, the first thing I see should be a list of FRNs which I might invoice. The list would show funding year, FRN, SPIN, service provider name, and funding available. I'd just type a pre-discount amount next to one of the FRNs, click a button, and poof, I get a form with everything filled in except the form identifier.
2. On the existing form, when the discount percentage pops in, so should the funding remaining in that FRN.

All in good time

It's official: this year's filing window will open on Nov. 7th and close on Feb. 7th. The USAC board approved a January 24th closing, but thank goodness, the closing has been returned to early February.

93 days! I think that's the longest window ever. Poor Mel (Blackwell): he wants a shorter window, and we're going the opposite direction. Of course, what Mel really wants is an earlier closing. In this case, I hope he doesn't get what he wants.

I, on the other hand, want a later closing for two reasons. The first is that forcing people to sign contracts for technology purchases at least six months before the purchase is made just isn't cost-effective. And forcing people to sign contracts and certify "secured" funding so far in advance of budget approvals puts applicants in an untenable position.

The second reason is based on one of the laws (well, one of my laws, anyway) of organization: a process will expand to fill the time allotted to it. So if the window closes at the end of April, the PIA process will shrink in order to process all those apps in two months. If the window closes in late December, the PIA process will expand to fill the extra weeks. So now let's have a show of hands: who wants an expanded PIA process? All right, I see a few hands up in the back, must be GAO or OIG observers. But I don't think even Catriona Ayer, the head of PIA, really wants to see the process go any further into the minutiae of funding requests.

Just imagine if PIA only had two months. I'll bet credits to navy beans that if your request was for Telecommunications Services, and less than $3,000 (which is about the median for the program), PIA review would consist of a spell-check. And you know what? The program wouldn't be any worse off: telecom is too highly regulated to be easily abused, and there's no point in trying to skim a percentage off $3,000. It's almost not worth it to do all the E-Rate paperwork for $3,000.

So the later the window closes, the more PIA will be forced to focus its effort on the areas that really deserve scrutiny, and leave in peace the 80% of applicants who just want a little help paying their measly phone bill.

Bring you Macs

Last week's News Brief had a little tidbit that surprised me: the System Requirements for USAC's online forms includes Mac OS 9. Last I knew, USAC didn't support Macs. What a welcome change. The online forms just keep getting better. Except, ironically, the "Submit a Question" application. I still get an error about half the time I use that dog.

And all the tips for completing forms were useful, too. One editing suggestion: they should have added spaces to the list of things to avoid when entering costs. Here's my tale of woe. When you copy and paste an Excel cell, depending on the formatting of the cell, the number sometimes goes in with spaces before and after the number. In the online BEAR, if you paste such a number into the Pre-Discount total field, then hit the "Tab" key, the discount amount calculates correctly. But then when you finish the rest of the form and hit the Submit button, you get an error message saying that the pre-discount amount has to be a number. And since you can't see spaces, the number looks just fine. I confess to saying unkind things about Mr. Kraft and the Solix development team until I figured that one out. But now I just delete the spaces and all is well.

This weekend?!

USAC has announced that in order to be ready for the opening of the 2008-2009 window a week from Wednesday, they will be performing maintenance on their systems this weekend. You've got to be kidding.

First of all, the announcement came out on Friday. I have a general beef with USAC taking its systems down with little or no warning. Did you know, for instance, that the Data Retrieval Tool is frequently unavailable from 9:00 to 11:00 p.m.? (It maybe every night; I haven't tested it.) I realize that the downtime does not affect normal users, and that it is a sad comment on my life that I am even aware of the outages. But putting aside whether the E-Rate has taken over too much of my life, my complaint is that when you're going to have a system outage, you give users notice. In the case of one-time, non-emergency outages like those planned this weekend, a week's notice would be fair, two weeks would be better. (OK, I know the FCC barely gave USAC any notice of the window opening, but the timing is hardly a shock.) In the case of routine outages like the DRT being out most nights, that information should be published on the USAC Web site somewhere.

Second, the timing is foolhardy. The announcement says, "any interruptions should be of minimal duration." In the IT profession, we call such statements "famous last words." Of course interruptions should be minimal, the same way that my kids should do as I say. But IT systems can be as unruly as my children. In any change to a system as complex as the USAC IT infrastructure, there will be unexpected results. I actually think that USAC has a pretty good record when they make system upgrades, but that means that the glitches are minor and quickly repaired, not that upgrades go off without a hitch.

In general, I have to question the choice of a weekend to do upgrades. If I (or any other sad individual unable to leave the E-Rate alone for a whole weekend) find a problem, my only option for reporting it is to use the incredibly lame "Submit a Question" (SAQ) application on the Web site. First problem: SAQ is finicky in the best of times, and if there's a system problem, it may become collateral damage. Second problem: if all goes well, my complaint goes into a Client Service Bureau (CSB) mailbox, where it will languish until Monday morning. My perception is that Solix (who seems to doing the systems work) does not have a big team of QA people testing the Web site after every change, so many glitches are discovered by users. That's OK with me, but only if the users have a way to report the glitches immediately.

So with two major deadlines coming up on Monday, I don't think this weekend is the optimal time to make system changes.

USAC creates more waivers

It's not on the USAC site yet, but a reliable source tells me that USAC has decided that the filing window will open November 7, 2007 and close January 24, 2008. Bad move. That early end date is a bad idea in the big picture, but especially bad for this year.

Big picture: If the FCC wants applicants to certify on the Form 471 that they have "secured funding" to pay the applicant share of costs, then the deadline for the 471 should be in late April or early May, when many applicants secure funding for the following funding year. (Some applicants don't secure funding until after July 1, but I don't know how to help them.) The earlier you move in the year, the earlier you move in the budget formulation process, the more meaningless that certification becomes.

For this year: USAC has been saying at the trainings that the window would close in early February. By closing it in the third week of January, they're going to cause a lot of people to file late. And you know those people are going to request a waiver from the FCC, and they're going to get it, only they won't get it until well into the funding year and it creates extra paperwork for everyone.

I hope the FCC is prepared for the wave of appeals coming.

Gentlemen, start your engines!

The Eligible Services List (ESL) for the 2008-2009 funding year has been released. I'll have comments on the list I'm sure, but probably not until after BEAR season ends. There don't seem to be any big surprises.

The big news with the actual release of the ESL is not eligibility, but timing. For the second straight year, the list was released on Oct. 19th. That's too late. When the FCC started the current ESL process (public comment and FCC approval of the list), they set a rule that the list must come out 60 days before the opening of the window. They have never even come close. This year, we got 19 days.

The 60-day waiting period is a good idea. A change in the ESL can make a change in an applicant's purchasing plans. That change may require an amendment to the technology plan, which has to done before filing the Form 470, which should be done 28 days before the opening of the window. With only 19 days, you can't even get a 471 filed at the start of the window unless you filed a 470 before knowing what would be eligible.

True, there is plenty of time within the filing window to file the 470 and then the 471, but that's not behavior that the FCC should be encouraging. Mel Blackwell has said that he'd like to shorten the filing window, since we all file in the last 2 weeks of the window, anyway. In order to make that change, applicants have to get used to filing the 470 before the window opens. The FCC is making that very difficult.

In the notice announcing the release of the ESL, the FCC authorized USAC to open the window on November 7th. Why? Didn't Mel Blackwell stand up and say that the window would start in mid-November and end in early February? Why open the window so early? I think there will be much wailing and gnashing of teeth if the window closes before, say, February 8th. That would give us a 93-day window. Mel said he wants to shorten the window, and we get this.

The FCC should have opened the window on November 26th. A shortened window would be best achieved in increments: cut it to 74 days this year, then 60 days next year, and so on. But part of the key is actually having the ESL come out 60 days before the window opens. Gradually, applicants will get used to filing the 470 before the opening of the window.

Plus, of course, the FCC would be modeling good behavior by meeting deadlines, instead of waiving its own rules every single year.

Where, oh where, has our ESL gone?

Where, oh where, can it be?

It's a pointless exercise, but a bit of a tradition on this blog, so let's start the annual Eligible Services List (ESL) watch. For those of you who don't know, the FCC released USAC's proposed ESL on July 27, allowed comments until August 17, and is now reviewing those comments.

By the FCC's own rules, the ESL must be published 60 days before the opening of the 80-day application window. That's a reasonable (though not generous) amount of time for applicants to determine which services are eligible, post a 471, and wait 28 days for responses.

Let's do some math: If the ESL came out today, the window could open no earlier than December 15, which would make the end of the 80-day window March 4.

But every year since the FCC created the 60-day rule, they have waived it. And the 80-day filing window is just tradition, I think: I don't think I've seen it enshrined in any FCC rulings. Since Mel Blackwell (head of USAC's Schools & Libraries Division) stood up at the training this year and said that the window would open mid-November and close in early February, I'm betting that the FCC will release the ESL in the next couple of weeks, waive the 60 days down to 25 days, and give us a window a little shorter than 80 days.

Want to join in the fun? Here's your opportunity to make your own guess on the dates.

Today's diversion

The National Telecommunications Cooperative Association (NTCA), an association of rural telecom providers, has made The Sweet Sounds of the Universal-Service Fund: Phone on the Range, a short advocacy video with singing cowboy marionettes. Apparently it's been around for a year, but I just found it. It could be the next Numa Numa song.

I especially like the school kid using a laptop on horseback; thank goodness that mobile Internet access has been made eligible, otherwise that poor student would be Internet-less while punchin' dawgies.

Dwindling competition

Funds for Learning every now and then releases a paper on some aspect of the E-Rate, and they're usually worth a look. I especially like them because they're short, with lots of graphs and tables, which is how I like my info.

They've just released a new report on the dwindling number of service providers in the E-Rate program. It's very short and has some interesting figures. The main gist is that the number of service providers in the E-Rate program has dropped every year since the program's inception. That's bad, because it might indicate decreasing competition. And the E-Rate application process already inhibits competition more than it should.

Of course, it got me thinking (one of my difficulties in life is that everything gets me thinking). I wondered what the numbers look like broken out among Categories of Service, so I did a quick analysis. Here's what I noticed.

By 2003, more than half the Internal Connections (IC) service providers (SPs) had left. (It's hard to get a clear picture since then from the quick analysis I did, because Basic Maintenance (BMIC) split off in 2005.) The E-Rate program is frustrating for service providers, because the funding is unpredictable. Also, the overhead associated with E-Rate funding is hard for IC SPs, since many of them only have one or two E-Rate projects, as opposed to a telecom, which has an entire E-Rate office. Every year, I'm contacted by a few gung-ho IC bidders, who think that the E-Rate is a gold mine. Within a year or two, almost all of them have given up on the E-Rate.

The number of Telecommunications Services (TS) providers plummeted 25% in the first two years, and has basically been steady ever since. I notice that the Eligible Services List for 1999 did not make clear that TS could only be delivered by common carriers, while the ESL for 2000 did make that clear. Does that explain why the number of SPs dropped so suddenly?

Since 2003, the number of SPs has held steady for TS and Internet Access (IA). The numbers for IC/BMIC are a little less clear (again the 2005 split created some double counting), but the total effect seems to be a drop in SPs.

Here are the starkest numbers to me. For 1998, there were twice as many SPs in TS as in IA, and twice as many IC as TS. For 2007, the number of SPs for TS, IA and IC (including BMIC) look about even.

I'd like to compare the numbers for funded FRNs, and take a closer look at the "churn" that Funds for Learning mentioned (looking at the number of SPs leaving the program and the number of new ones coming in), and remove the double-counting caused by the IC/BMIC split, but unless someone's going to pay me to do it, I'd better get back to work.

Tech plan debacle

As I mentioned in my previous post, I took a look at the report for the E-Rate that the FCC Inspector General did as part of an analysis of audit results. The IG singled out the number of failures due to tech planning. I hope that will make the FCC rethink its rules on tech planning. I have two alternatives for fixing the problem.

Alternative #1: Scrap the tech planning requirement. Mandatory tech planning is like mandatory sensitivity training; the people who need it are just going through the motions. Most of these tech plans are dusted off every 3 years, renewed, then put back on the shelf. We can argue about the merits of a long-term plan vs. a flexible response to changing needs and costs, and maybe schools would benefit from more planning, but it's certain that if a tech plan is done only to satisfy outsiders, it's useless.

Alternative #2: USAC should run an online tech plan tool. The tool should create a much clearer idea of what the tech plan should be, and automate creation and maintenance of the plan. I know the PA Dept. of Ed has done this with their eTechPlanner, and Kellogg & Sovereign created an online tech plan creator for their clients (and has made it available to others). A tech plan tool from USAC could go further in forcing applicants to report progress on completing the plan and to update the plan. Also, if USAC were running the tool, if an applicant tried to file a Form 470 for a period or category of service that was not covered by the tech plan, the applicant could get a warning.

I know that many people would be reluctant to turn the tech plan into basically another form to be filled out, but here's my attitude: USAC and the FCC have certain requirements when it comes to tech plans (incidentally, the IG report points out that those requirements clashed when it comes to tech planning). A well-designed form clearly lays out expectations, and makes it more difficult to inadvertently fail to meet requirements. Turning the tech plan into a form wouldn't create new rules or add complexity, it would bring the existing rules and complexity out into the open.

Which program is "troubled"?

The FCC's Inspector General has released an analysis of audits of the Universal Service Fund. The first thing that jumped out at me was the only statistic in the press release.

"The audits resulted in the following erroneous payments rates: Contributors payments - 5.5%, Low Income - 9.5%; Schools and Libraries - 12.9%; High Cost Fund - 16.6%; and Rural Health Care - 20.6%."

So while the E-Rate has been made the poster child for USF waste, fraud and abuse, it actually has fewer erroneous payments than High Cost or Rural Health Care.

I wish I had some spare time to compare the number of rules involved in each program, because it seems to me that the E-Rate rules are much more complex than any of the other programs; we know that USAC spends a lot more administering it.

I also took a look at the report for the E-Rate. My favorite part: the IG made a list of reasons for non-compliance, and included "Imprecise FCC Rule/s," "Contradictory FCC Rule/s" and "Overly Complex FCC Rules." How many cases of non-compliance were attributed to those reasons? Zero, zero and zero. I think if the IG took a survey of applicants about reasons for non-compliance, imprecise and overly complex rules would be reasons #1 and #2.

The other thing that jumped out at me (and apparently IG, too) was the number of failures due to tech planning. I hope that will make the FCC rethink its rules on tech planning. More on that in my next post.

How minimis can you get?

Another Bi-Annual Audit Recovery Report has been released. It's pretty much a yawner. Of the $1.6 billion in funding audited, only $81 million requires recovery. That means when someone is audited, which is often the result of USAC suspicions, improperly disbursed funds are found only about 5% of the time. Of that total, $25.5 million is being appealed, so maybe the percentage is actually lower. And that 5% includes applicants who didn't necessarily do anything wrong, but can't prove they did the right thing. Seems like a pretty clean program to me.

But the thing that jumped out at me: USAC is going after an applicant for $329. There may be other applicants being pursued for similar amounts, but this applicant happened to be the only one in its category, so it jumps out.

In the Fifth Report and Order, the FCC said, "We also conclude that a de minimis exception is in the public interest and direct USAC generally not to seek recovery when the administrative cost is greater than the recovery amount." So USAC set the threshold at less than $329?! If USAC can really collect on audit findings for $329, considering all the appeals, letters, etc., I want to hire them to go after my deadbeat clients.

By the way, there is a de minimis standard in the Universal Service Fund. The de minimis standard for phone companies who contribute to the fund is $10,000. Granted, it's an apples to oranges comparison, but how can an apple be $329 when an orange is $10,000?