[Federal Register Volume 88, Number 152 (Wednesday, August 9, 2023)]
[Proposed Rules]
[Pages 53837-53850]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-16985]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 54

[CC Docket Nos. 02-6, 96-45 and 97-21; FCC 23-56; FRS ID 160342]


Schools and Libraries Universal Service Support Mechanism, 
Federal-State Joint Board on Universal Service, and Changes to the 
Board of Directors of the National Exchange Carrier Association, Inc.

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document, the Federal Communications Commission 
(Commission) seeks comment on rule changes and clarifications suggested 
by commenters to further streamline and improve the application process 
for all E-Rate applicants, including Tribal and other small, rural 
entities. The Commission expects that these measures will provide a 
meaningful difference for Tribal communities, especially Tribal 
libraries that seek to participate in the E-Rate program.

DATES: Comments are due on or before September 25, 2023 and reply 
comments are due on or before October 23, 2023. If you anticipate that 
you will be submitting comments but find it difficult to do so within 
the period of time allowed by this document, you should advise the 
contact listed below as soon as possible.

ADDRESSES: Pursuant to Sec. Sec.  1.415 and 1.419 of the Commission's 
rules, 47 CFR 1.415, 1.419, interested parties may file comments and 
reply comments. You may submit comments, identified by CC Docket Nos. 
02-6, 96-45, 97-21, by any of the following methods:
     Electronic Filers: Comments may be filed electronically 
using the internet by accessing the ECFS: https://www.fcc.gov/ecfs/.

[[Page 53838]]

     Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing.
    [cir] Filings can be sent by commercial overnight courier or by 
first-class or overnight U.S. Postal Service mail. All filings must be 
addressed to the Commission's Secretary, Office of the Secretary, 
Federal Communications Commission.
    [cir] Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9050 Junction Drive, 
Annapolis Junction, MD 20701.
    [cir] U.S. Postal Service first-class, Express, and Priority mail 
must be addressed to 45 L Street NE, Washington, DC 20554.
    [cir] Effective March 19, 2020, and until further notice, the 
Commission no longer accepts any hand or messenger delivered filings at 
its headquarters. This is a temporary measure taken to help protect the 
health and safety of individuals, and to mitigate the transmission of 
COVID-19. See FCC Announces Closure of FCC Headquarters Open Window and 
Change in Hand-Delivery Policy, Public Notice, DA 20-304 (March 19, 
2020), https://www.fcc.gov/document/fcc-closes-headquarters-open-window-and-changes-hand-delivery-policy.
     People with Disabilities: To request materials in 
accessible formats for people with disabilities (Braille, large print, 
electronic files, audio format), send an email to [email protected] or 
call the Consumer & Governmental Affairs Bureau at (202) 418-0530 
(voice), (202) 418-0432 (TTY).
     Availability of Documents: Comments, reply comments, and 
ex parte submissions will be publicly available online via ECFS.
    For detailed instructions for submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT: Johnny Roddy [email protected] or 
Kate Dumouchel [email protected] in the Telecommunications Access 
Policy Division, Wireline Competition Bureau, 202-418-7400 or TTY: 202-
418-0484. Requests for accommodations should be made as soon as 
possible in order to allow the agency to satisfy such requests whenever 
possible. Send an email to [email protected] or call the Consumer and 
Governmental Affairs Bureau at (202) 418-0530.

SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission's 
Schools and Libraries Universal Service Support Mechanism, Federal-
State Joint Board on Universal Service, and Changes to the Board of 
Directors of the National Exchange Carrier Association, Inc., Further 
Notice of Proposed Rulemaking (FNPRM) in CC Docket Nos. 02-6, 96-45 and 
97-21; FCC 23-56, adopted July 20, 2023 and released July 21, 2023. The 
Commission also released a companion Report and Order (Order) in CC 
Docket Nos. 02-6, 96-45 and 97-21; FCC 23-56, adopted July 20, 2023 and 
released July 21, 2023. The full text of this document is available for 
public inspection during regular business hours at Commission's 
headquarters 45 L Street NE, Washington, DC 20554 or at the following 
internet address: https://docs.fcc.gov/public/attachments/FCC-23-56A1.pdf.

I. Introduction

    1. The E-Rate program provides support to ensure that schools and 
libraries can obtain affordable, high-speed broadband services and Wi-
Fi equipment to connect today's students and library patrons with next-
generation learning opportunities and services. In January 2022, the 
Commission began an initiative to increase Tribal libraries' access to 
E-Rate support, recognizing the valuable role that these entities serve 
in providing high-speed internet access to Tribal communities. The 
Commission first clarified that Tribal libraries are eligible to 
participate in the program and later launched a Tribal Library Pilot 
Program to ensure that Tribal library entities have equitable access to 
the E-Rate program. Building on those efforts, the Commission initiated 
a rulemaking proceeding in February 2023 to seek comment on additional 
rule changes to improve Tribal participation in the E-Rate program. The 
Commission takes steps to further enhance Tribal applicants' access to 
the E-Rate program through program simplifications and other changes 
that aim to encourage greater Tribal participation in the program. At 
the same time, the Commission takes steps to simplify the E-Rate 
processes, where appropriate, for other E-Rate applicants and seeks 
comment on further possible rule changes suggested by commenters in 
this document.

II. Further Notice of Proposed Rulemaking

    2. Consistent with the changes adopted in the companion Order, in 
the FNPRM, the Commission seeks comment on the discrete issues that may 
further simplify the administration of the E-Rate program and reduce 
burdens for all applicants, including Tribal and other small, rural 
entities. Specifically, to continue meeting the program's performance 
goal of making the E-Rate application process and other E-Rate 
processes fast, simple, and efficient, the Commission seeks comment on 
a number of suggestions raised by commenters in response to the Tribal 
E-Rate NPRM, In the Matter of Schools and Libraries Universal Support 
Mechanism; Federal-State Joint Board on Universal Service; Changes to 
the Board of Directors of the National Exchange Carrier Association, 
Inc., CC Docket Nos. 02-6, 96-45, 97-21, Notice of Proposed Rulemaking, 
rel. Feb. 17, 2023, FCC 23-10, which sought comment on streamlining or 
simplifying the program.
    3. The Commission remains committed to protecting the integrity of 
its programs. As the Commission considers proposals that look to 
further simplify the administration of the E-Rate program and reduce 
barriers that may inhibit Tribal and other small, rural applicants from 
participating in the program, the Commission notes its intention that 
reducing barriers does not mean reducing its commitment to maintaining 
the integrity of the E-Rate program. The Commission utilizes several 
different resources at its disposal to ensure that protections are in 
place prior to implementation of any rules regarding the oversight and 
administration of E-Rate, as well as investigating and rooting out bad 
actors from the program. The Commission intends for the Wireline 
Competition Bureau (Bureau) to continue coordinating with the 
Enforcement Bureau, the Office of Managing Director, the Office of 
General Counsel, the Office of Economics and Analytics and other 
Commission resources to ensure the E-Rate program is protected. 
Further, the Commission intends that the Bureau and other relevant 
Commission offices continue consultation with other entities, such as 
the Government Accountability Office (GAO) and the FCC Office of 
Inspector General, that have a shared interest in maintaining the 
integrity and improving the operations of the Commission's programs. 
Where possible, the Commission will strive to incorporate the 
recommendations of the various entities in the decisional documents in 
an effort to establish robust protections against waste, fraud, and 
abuse. The Commission seeks comment on these commitments and how best 
to ensure that any of the proposals herein maintain and enhance 
safeguards to protect the integrity of the E-Rate program. For example, 
do commenters believe it would be beneficial to

[[Page 53839]]

compile and make available recommendations that were submitted as part 
of such consultations?
    4. Updating Eligible Services. License/Software Distinction. The 
Commission first seeks comment on allowing all eligible multi-year 
software-based services that are purchased with category two equipment 
to be requested and reimbursed in the same manner. Currently, software-
based services are eligible as Internal Connections service when they 
are necessary for the operation of a piece of eligible Internal 
Connections equipment, such as a client access license. However, bug 
fixes, security patches, and technical assistance-based software 
services are eligible as Basic Maintenance of Internal Connections 
(BMIC) services. As explained in the Sixth Report and Order, 75 FR 
75393 (12/03/2010), ``[r]equests for basic maintenance will continue to 
be funded . . . if, but for the maintenance at issue, the service would 
not function and serve its intended purpose with the degree of 
reliability ordinarily provided in the marketplace to entities 
receiving such service.'' Applicants are currently required to amortize 
the cost of BMIC-related services, including for example, software-
based technical assistance services, across the length of the BMIC 
multi-year contract, and cannot receive full funding for the BMIC 
software-based technical assistance services in the first year of the 
contract, even if the applicant has prepaid for the multi-year BMIC 
software service with the purchase of the category two equipment. This 
means that the current E-Rate rules allow the applicant to receive full 
funding for an internal connections-related multi-year software service 
in the first funding year, but for other multi-year software-based 
services for technical assistance, like bug fixes, which are considered 
to be BMIC services, the applicant must split the cost of the multi-
year software service evenly for each funding year, even if the 
applicant was required to prepay for the multi-year BMIC software-based 
services at the start of the contract period. This procedure stems from 
the Commission's efforts in 2010 to only have the E-Rate program pay 
for basic maintenance services that are actually provided over the 
course of the funding year, and to prevent the E-Rate program from 
being used to prepay for BMIC services that were never used or needed 
by the applicant.
    5. In their comments to the Tribal E-Rate NPRM, the State E-Rate 
Coordinators' Alliance, the Schools, Health, and Libraries Broadband 
Coalition, the Consortium for School Networking, and the State 
Educational Technology Directors Association (collectively, the Joint 
Commenters) explain that this distinction in the treatment of multi-
year software-based services causes confusion during the competitive 
bidding process, where applicants are concerned about funding denials 
if they select the incorrect service subcategory (i.e., use internal 
connections instead of BMIC) on FCC Form 470, and places a burden on 
applicants that requires them to divide the cost of a prepaid multi-
year BMIC software-based service request across multiple funding years. 
The Commission therefore seeks comment on the proposal to treat these 
particular software-based services (e.g., bug fixes, security patches, 
and software-based technical assistance) in the same way it currently 
treats eligible Internal Connections software-based services, like 
client access licenses. The Commission also proposes to allow 
applicants that sought bids on their FCC Form 470 only for Internal 
Connections software services to be permitted to request funding for 
their multi-year BMIC software-based services without being found to 
have violated its competitive bidding rules for failing to check the 
correct box for this software request, and to allow applicants 
requesting these types of software-based services to be funded based on 
how the software-based service is contracted and invoiced with the 
service provider (e.g., funding a multi-year software-based service for 
bug fixes in a single funding request during the first year of service 
if the service is paid for in that first year). The Commission seeks 
comment on these proposals.
    6. Transition of Services. Applicants and service providers have 
also sought additional clarification on how to request E-Rate support 
when an applicant is transitioning services between two providers 
during the same funding year. To prevent funding duplicative services, 
program procedures do not allow Universal Service Administrative 
Company (USAC) to commit funding to two funding requests for the same 
service, to the same recipients, that overlap in time. At the same 
time, due to concerns about exceeding the E-Rate funding cap, the 
Commission's service substitution rules require that post-commitment 
service substitutions be based on the lower of either the pre-discount 
price of the service for which support was originally requested or the 
pre-discount price of the new, substituted service. As such, applicants 
are encouraged to work with their service providers to try to determine 
the cutover dates when transitioning service to a new provider during a 
funding year. The Commission recognizes, however, that this can be 
difficult to determine with accuracy, months in advance of the planned 
transition.
    7. One approach is to allow applicants to request twelve months of 
service from the higher-priced service offering, and then file a post-
commitment request to change the service provider once the cutover 
dates are known. The Commission notes that this suggestion results in 
the service request being funded higher than the actual costs of the 
services, and may inflate the overall demand for E-Rate support for 
that year. However, the Commission seeks comment on whether this is 
still the best way to allow for mid-year service provider transitions, 
or whether it should consider alternative guidance or a rule change 
regarding these types of mid-year transitions. For instance, should the 
Commission consider amending its service substitution rules to allow 
applicants in this unique situation to request a service substitution 
that will result in an increase in the pre-discount price if the 
transition occurs at a different date than had been anticipated and 
requested? If so, should the Commission require applicants to include 
an explanation in their service substitution request documenting the 
reasons that the change resulted in an increase in the pre-discount 
price? Should the Commission limit USAC's ability to grant such a 
service substitution request on the availability of funding for the 
applicable funding year under the funding cap? Based on prior years' 
data, the Commission does not expect this to be a large amount of 
funding, but it generally does not increase annual E-Rate demand post-
commitment. Are there any other issues that the Commission should take 
into account by allowing applicants to potentially receive a commitment 
amount higher than the one originally approved for the services? How 
might such increases in funding impact the annual E-Rate cap adopted by 
the Commission? Are there budget control measures that the Commission 
should adopt to ensure this new proposal does not cause the Commission 
to exceed the cap? The Commission seeks comment on these questions and 
how mid-year service provider transitions should be handled in the E-
Rate program.
    8. Duplicative Services. The Commission next seeks comment on the 
Joint Commenters' request for additional clarification regarding cost-
effective purchasing on services from two

[[Page 53840]]

different providers. In the Second Report and Order, 68 FR 36931 (06/
20/2003), the Commission found that requests for duplicative services, 
or services that provide the same functionality for the same population 
in the same location during the same time, are ineligible and 
contravene the program requirements that discounts be provided based on 
the reasonable needs and resources of the applicant. It also found that 
requests for duplicative services are not cost-effective, but the 
Commission recognized that determining whether particular requests are 
functionally equivalent depends on the circumstances. In the Macomb 
Order, In the Matter of Requests for Review by Macomb Intermediate 
School District, Technology Consortium, Clinton Township, MI, Schools 
and Libraries Universal Service Support Mechanism, CC Docket No. 02-6, 
rel. May 8, 2007, FCC 07-64, USAC denied a funding request from the 
Macomb Intermediate School District Technology Consortium, which 
requested T-3 connections to provide internet access to its school 
district from three separate service providers. The Commission agreed 
that the school district violated Sec.  54.511 of the Commission's 
rules by not selecting the most cost-effective service offering among 
the bids considered, but provided the school district with funding for 
all three T-3 connections at the amount associated with the least 
expensive of the three providers.
    9. The Joint Commenters request clarification that applicants may 
seek needed services from multiple providers as part of the same 
procurement, so long as the applicant is limited to E-Rate funding 
based on the least expensive service when one provider could have met 
all the applicant's needs. The Commission seeks comment on this 
proposal and the desire by schools to purchase services from multiple 
providers in the same procurement. How often is the scenario in the 
Macomb Order present in current school network configurations? How can 
USAC best evaluate whether applicants need the services requested from 
multiple providers, or whether the services are actually duplicative, 
such as requests for redundant or failover connections? What kind of 
documentation can applicants and/or service providers use to 
demonstrate that the services are not duplicative services (i.e., 
redundant or failover connections)? What safeguards can the Commission 
use to only fund services that are needed and are being used by the 
applicant? The rules require that price must be the primary factor in 
considering which service offering is the most cost-effective, but 
should the Commission require price to be the only factor in order to 
ensure applicants select the least expensive service option in these 
scenarios when the applicants wishes to use multiple providers for the 
requested services? Are additional safeguards needed to ensure 
competitive bidding is still effective for ensuring cost-effective 
services when applicants seek to contract with multiple service 
providers for the requested services? What information or data may need 
to be collected on the funding application forms to demonstrate the 
requested services are needed and are not duplicative services? Are 
there other issues that the Commission should consider in allowing 
multiple service providers to be selected for the same procurement and 
requested services? Finally, the Commission also seeks comment on 
whether further guidance is needed for applicants seeking redundant or 
resilient circuits provided by a single carrier. While redundant 
circuits would be considered duplicative, are there any unique types of 
arrangements or network configurations being used that might be needed 
and how can applicants and/or service providers document the need?
    10. Other Simplification Opportunities. The Commission seeks 
comment on other changes to the eligible services list and cost 
allocation requirements that could simplify the E-Rate program, 
particularly for new and smaller applicants. For example, should the 
Commission revise the eligible services list to use the same terms as 
used on FCC Form 470 or FCC Form 471? For instance, would it make more 
sense to use the terms from FCC Form 470 like fiber, cable, copper, 
wireless, and other in the eligible services list of data transmission 
and/or internet access services, rather than listing out specific 
types, like ``Broadband Over Power Lines''? Are there terms in the 
eligible services list that should be updated or streamlined? Are there 
updates the Commission could make to the eligible services list process 
to make it easier to approve and release the list with sufficient time 
for review, before applicants must submit their funding applications? 
For cost allocation requirements, are there additional changes the 
Commission could make to clarify when applicants must cost allocate 
parts of their E-Rate funding requests? For example, are there other 
types of equipment similar to cabling, such as switches, for which cost 
allocation guidance is needed? Are there other examples of challenging 
cost-allocation calculations that the Commission could further 
streamline for Tribal applicants? Are there other examples of ancillary 
use unique to Tribal libraries or small entities that share buildings 
on which the Commission could consider providing further guidance? Are 
there particular challenges with cost allocation of category two 
services used in multipurpose buildings, that the Commission could 
simplify? The Commission seeks comment on these questions and other 
suggestions for simplifying the cost-allocation. Finally, should the 
Commission consider changes to the application process for certain 
eligible services? Specifically, the Commission seeks comment on 
whether a rolling category two application deadline or a second 
application filing window for category two services would simplify or 
complicate the E-Rate program. If the Commission were to consider 
changes to the deadline for filing for category two applications, what 
limits would be needed to ensure demand can be appropriately 
calculated?
    11. Changing or Clarifying the E-Rate Competitive Bidding 
Requirements. The E-Rate program's competitive bidding requirements 
reflect the Commission's determination that competition is the most 
efficient and effective means for applicants to select the most cost-
effective service offerings. The Commission has long held that a fair 
and open competitive bidding process is fundamental to the integrity of 
the E-Rate program. Thus, the Commission has consistently required 
applicants to treat all potential bidders equally throughout the 
procurement process, provide all bidders access to the same 
information, and ensure that no bidder receives an unfair advantage. 
Selecting the most cost-effective bid and ensuring that price of the 
eligible equipment and services is the primary factor considered in the 
bid evaluation process are other fundamental requirements of the 
Commission's competitive bidding rules.
    12. Competitive Bidding Exemptions. In their comments to the Tribal 
E-Rate NPRM, the American Library Association (ALA) recommends that 
small libraries requesting less than $10,000 in E-Rate funding to be 
subject to fewer competitive bidding requirements and less rigorous 
review during the application process by treating funding requests 
under $10,000 as de minimis. Specifically, ALA explains that libraries 
rely on state and local procurement rules for these purchases and 
additional competitive bidding requirements are not needed

[[Page 53841]]

because of the low amount of requested funding. The Commission seeks 
comment on this proposal to create a competitive bidding exemption for 
E-Rate funding requests under $10,000 submitted by libraries. In the 
Order, the Commission adopted a competitive bidding exemption for 
libraries making category two purchases of $3,600 or less, per funding 
year. The Commission seeks additional comment on expanding the 
exemption for libraries making smaller annual E-Rate requests (i.e., 
less than $10,000), along with data to support such a change. For 
example, ALA notes that 62.3% of libraries requested less than $10,000 
in total support for category one and category two services in funding 
year 2023, and 100% of libraries in certain rural states, like Montana, 
did so. However, the Commission also relies on fair and open 
competitive bidding to result in applicants making cost-effective 
purchases. If the Commission adopts this proposal, how can the 
Commission ensure that applicants are still making cost-effective 
purchases? What state, local, or Tribal procurement rules are in place 
for purchases that are under $10,000? Should the Commission also 
consider permitting schools to use the competitive bidding exemption 
for category two purchases of $3,600 or less, per funding year, or 
another exemption for school entities? If the exemption is expanded to 
schools, how can the Commission protect the E-Rate program from waste, 
fraud, and abuse? For example, ALA's proposal relies on the fact that 
libraries are subject to state and local procurement laws and 
requirements; are all school entities subject to state, local or Tribal 
procurement requirements? For example, are private schools subject to 
any specific state, local, or Tribal procurement requirements? The 
Commission seeks comment on these questions and supporting data for 
adopting a competitive bid exemption for E-Rate purchases under $10,000 
per funding year.
    13. Mid-Year Bandwidth Increases. The Commission next seeks comment 
on adopting a limited exception to its competitive bidding rules to 
allow applicants to seek bandwidth increases in between E-Rate funding 
cycles. The E-Rate program rules require applicants to competitively 
bid services using FCC Form 470. This process starts at least 28 days 
before the applicant files their E-Rate funding requests during the 
annual application filing window, but can occur six months before, or--
in the case or multi-year contracts--years before the funding request 
is submitted. Applicants are encouraged to seek bids for and sign 
contracts for a range of bandwidths in order to accommodate changes in 
bandwidth needs in the future, but applicants are not always able to 
anticipate changes in their bandwidth needs. In 2020, for example, the 
Bureau opened a second application filing window in September to 
address increased on-campus bandwidth needs as a result of remote 
learning challenges from the COVID-19 pandemic. However, in other 
instances, applicants may be unable to increase their bandwidth mid-
funding year without potentially violating the E-Rate program 
competitive bidding rules.
    14. The Joint Commenters therefore suggest an exception to the 
competitive bidding rules to allow applicants to increase bandwidth 
during the school year (i.e., mid-funding year) by submitting a service 
substitution request to increase the bandwidth using their current 
provider at the existing committed amount without being found to have 
violated the program's competitive bidding rules. The Commission seeks 
comment on this proposal and how to allow for bandwidth increases 
without opening the door to applicants avoiding its competitive bidding 
rules or unfairly favoring incumbent service providers. What 
limitations would need to be adopted in order to ensure that the 
exception for mid-funding year bandwidth increases is not misused? How 
can USAC keep track of such mid-funding year bandwidth increases? Do 
commenters agree that applicants be allowed to request a service 
substitution request increasing the bandwidth, limited at the original 
funding commitment cost? Should such applicants be required to 
competitively bid for the increased bandwidth in the subsequent funding 
year? The Commission seeks comment on these questions and other issues 
the Commission should consider in adopting this exception to the E-Rate 
competitive bidding requirements.
    15. Providing Guidance to Applicants on When Competitive Bidding 
Must be Restarted. The Commission next seeks comment on how to reduce 
confusion about when changes made to the information provided on FCC 
Form 470 or related requests for proposals (RFP) requires an applicant 
to restart the competitive bidding process and wait at least 28 days 
before selecting their service offering(s). Under the Commission's 
competitive bidding rules, applicants must conduct a fair and open 
competitive bidding process. This means that applicants must treat all 
potential bidders equally throughout the entire procurement process, 
provide all bidders access to the same information, and ensure that no 
bidder receives an unfair advantage. Furthermore, applicants must 
describe the requested services with sufficient specificity to enable 
potential service providers to submit responsive bids for such 
services. Sometimes, the facts are clear that the requested E-Rate 
services were not fairly competitively bid and there was a violation of 
the competitive bidding rules. For example, applicants may not request 
E-Rate support for services that were not included on FCC Form 470. 
Similarly, applicants that fail to indicate the existence of a RFP have 
also been denied E-Rate support for suppressing fair and open 
competitive bidding. As such, in some instances, when applicants make a 
change to an FCC Form 470--such as by modifying the services being 
requested or by including an omitted RFP--that would change whether a 
service provider reviewing the original FCC Form 470 could submit 
responsive bids, the competitive bidding process should be restarted to 
allow all potential bidders the opportunity to bid based on the 
additional or modified information, and the applicant should wait at 
least 28 days after making these changes before selecting the most 
cost-effective service offering(s). In other cases, the Commission has 
granted requests for review where an applicant changed information on 
FCC Form 470 or associated RFP without finding a competitive bidding 
violation because the change did not impact potential bidders' ability 
to be able to submit responsive bids.
    16. As these examples indicate, whether a change to FCC Form 470 or 
RFP results in an unfair competitive bidding process is often a fact-
specific inquiry. The Commission therefore seeks comment on scenarios 
where it can provide more guidance on whether an applicant's changes to 
their FCC Form 470 or RFP requires it to restart the competitive 
bidding process and wait at least 28 days before selecting its service 
offering(s). E-Rate participants are encouraged to provide examples of 
instances where they believe changes to FCC Form 470 and/or RFP do not 
result in an unfair competitive bidding process as all potential 
bidders would still be able to submit responsive bids although certain 
information was modified in FCC Form 470 and/or RFP. Are there any 
presumptions or safe harbors the Commission could adopt so that 
applicants could have more certainty about whether and when they need 
to restart the competitive bidding process

[[Page 53842]]

because of that specific change that was made to FCC Form 470 and/or 
RFP? For instance, should applicants correcting errors in their 
bandwidth requests by less than 50% not be required to restart the 
competitive bidding clock (i.e., the minimum 28 day waiting period)? 
Are there other types of common changes to FCC Form 470 and/or RFP that 
should not require applicants to restart their competitive bidding 
process? The Commission seeks comment on these questions and what type 
of guidance or clarifications would be helpful for the Commission to 
provide on when changes to FCC Form 470 and/or RFP would not result in 
an unfair competitive bid process and when the applicant would be 
required to restart their competitive bid process and wait a minimum of 
28 days before selecting the most cost-effective service offering(s) 
after making the change or modification.
    17. Spam Bids and Bids Received After 28 Day Waiting Period. Under 
the E-Rate competitive bidding rules, applicants are required to 
carefully consider all received bids, with price being the primary 
factor, and select the most cost-effective service offering. Applicants 
must also wait at least 28 days before selecting the most cost-
effective service offerings. Applicants are permitted to set deadlines 
to close the competitive bid process (of at least four weeks after FCC 
Form 470 is filed) or establish other disqualification factors in FCC 
Form 470. The Joint Commenters explain that applicants are receiving 
more spam bids and other automated or ``robo'' responses to their FCC 
Form 470 that do not contain the information on the specific services 
requested by the applicant and seek guidance on whether these bid 
responses have to be considered and retained. They also seek guidance 
on whether and how long bids must be considered after the required four 
weeks have passed. Specifically, the Joint Commenters explain that 
service providers have set up automated responses to be sent, often 
within 24 hours, after an FCC Form 470 has been posted on USAC's 
website. In addition, multiple automated bid responses may be sent to 
the applicant for a single FCC Form 470. However, the automated bid 
responses do not contain the pricing and other information requested in 
FCC Form 470 and require the applicant to reach out to the service 
provider for additional information. The Joint Commenters request that 
the Commission clarify that spam and other automated bid responses do 
not meet the definition of an authentic bid and that applicants may, 
but are not required to, consider spam or other automated bid responses 
or be required to retain copies of the spam and other automated bid 
responses pursuant to the document retention rule. The Joint Commenters 
further explain that requiring applicants to acknowledge and retain 
spam and other automated bid responses is an onerous burden, and that 
the Commission should impose some minimal responsibility on service 
providers to submit responsive bids to the applicants and the automated 
bid responses should not be used as a basis to deny funding because of 
a non-compliant competitive bid process.
    18. For purposes of disqualifying spam or other automated bid 
responses or consideration of bids received after a deadline set in FCC 
Form 470, the Joint Commenters request that the Commission clarify the 
requirements and confirm that spam and other automated bid responses do 
not need to be treated as bids and that applicants may rely on the 28 
day allowable contract date (ACD) as the deadline for submitting bids 
when FCC Form 470 is silent on the bid submission deadline. In general, 
the Commission would expect applicants to carefully consider all bids 
received before the bid selection process has occurred, unless they 
provided a specific bid submission deadline and noted that bids 
received after the deadline would be disqualified on FCC Form 470. In 
light of the concerns raised by the Joint Commenters, the Commission 
first seeks comment on the types of spam and other automated bid 
responses that are being generated and sent to the applicant once or 
soon after their FCC Form 470 is posted. Please include examples of 
these types of bid automated bid response communications and other data 
regarding the frequency and number of automated responses that 
applicants receive after posting their FCC Form 470. The Commission 
seeks further comment on the Joint Commenters' request that the ACD be 
used as the bid response deadline when FCC Form 470 is silent on the 
bid submission deadline. The Commission notes that applicants are 
already allowed to state that bids that do not include all of the 
required information and/or are received after a specific deadline will 
be disqualified on their FCC Form 470 or in the accompanying RFP. The 
Commission requests further comment on why applicants are not able to 
add language to their FCC Form 470 that non-responsive bids will be 
disqualified or that bids received after the 28-day minimum waiting 
period will be considered late and will also be disqualified. Are 
changes to FCC Form 470 needed to include specific disqualification 
criteria that could be checked by the applicant? For example, should 
the Commission add a field to FCC Form 470 to allow applicants to 
indicate the deadline for submitting bids and any other requirement 
that will result in a bid being disqualified from consideration? The 
Commission also notes that it has an open proceeding related to a 
competitive bidding portal that could collect all bids that are 
received by the applicant and reduce confusion about these types of 
bids and deadlines. Procedurally, should the Commission delay taking 
action on the treatment of spam and other automated bid responses until 
after it takes action in that open proceeding, or should the Commission 
consider these proposals while that proceeding is still pending before 
the Commission? Would the proposed bidding portal be helpful as a 
competitive bid document repository to reduce the documentation 
retention related burdens on applicants? The Commission further seeks 
comment on how to ensure applicants are complying with program rules to 
carefully consider all bids received and retain them for the 
appropriate ten-year document retention period, if spam or other 
automated bid responses are not treated as ``bids.'' If exceptions are 
made regarding the consideration and retention of certain types of bid 
responses, how does the Commission ensure the exception is not misused 
and responsive bids are not considered or retained as required by the 
Commission's rules? The Commission seeks comment on all of these 
questions, as well as any other issues the Commission should consider 
to ensure the E-Rate competitive bidding process remains fair and open, 
and compliant with the Commission's rules if changes or clarification 
is provided about what response is a bid.
    19. Evidence of a Legally Binding Agreement. The Commission's E-
Rate rules also require that the applicant have a signed contract or 
legally binding agreement before requesting E-Rate funding. When 
modifying this rule in 2014 to allow for legally binding agreements 
rather than requiring only signed contracts, the Commission explained 
that USAC would consider the existence of a written offer from the 
service provider containing all the material terms and conditions and a 
written acceptance of that offer as evidence of a legally binding 
agreement. The Joint Commenters now suggest that board minutes 
approving a contract

[[Page 53843]]

offer should be evidence of an applicant's acceptance, demonstrating a 
legally binding agreement. The Commission seeks comment on this 
proposal and whether there are additional examples that USAC should 
consider as evidence of a legally binding agreement. Conversely, ALA 
suggests removing the legally binding agreement requirement and 
suggests that E-Rate applicants be allowed to rely on a price quotation 
before submitting their E-Rate applications. In the Emergency 
Connectivity Fund program, applicants were allowed to rely on price 
quotations due to the emergency nature of the program and the lack of 
significant advance notice before the first application filing window 
opened. The Commission also seeks comment on this request and how 
accepting a price quotation would streamline the application process. 
The Commission also seeks comment on whether modifying this 
requirement, and allowing a price quotation to be used, may lead to 
greater potential of waste, fraud, and abuse, and the Commission 
invites comments on how to minimize that risk.
    20. Ensuring Our Rules Recognize Tribal Law. The Commission seeks 
comment on whether the E-Rate program rules should be updated to 
recognize that competitive bidding regulations are often imposed by 
Tribal as well as state and local governments. For example, the 
Commission's competitive bidding rules state that the program-specific 
rules ``apply in addition to state and local competitive bid 
requirements and are not intended to preempt such state or local 
requirements.'' Recognizing that Tribal governments may also have 
procurement rules in place, should the Commission add Tribal to this 
list? Are there other areas of the Commission's program rules that 
should be updated to recognize the Tribal government role?
    21. Finally, the Commission seeks comment on other competitive 
bidding-related requirements the Commission should consider updating or 
otherwise modifying. For example, the Commission seeks comment on how 
product demonstrations are conducted for applicants in the E-Rate 
program. Should the Commission modify or provide guidance related to 
its gift rules to provide additional clarity around product 
demonstrations? What safeguards should the Commission adopt to ensure 
applicants are not ultimately receiving free equipment through a 
product demonstration that would impact conducting a fair and open 
competitive bidding process? In considering any such changes to the 
competitive bidding rules, the Commission is mindful of its commitment 
to protect E-Rate funds. As the Commission continues its efforts to 
safeguard the program and assess fraud risks to the E-Rate program, 
should the Commission consider how to sequence any potential 
modifications to its rules in light of its ongoing work to protect the 
program's integrity?
    22. Streamlining the E-Rate Program Forms. The Commission seeks 
comment on a number of proposals to modify the E-Rate program forms to 
streamline the application process. First, the Commission seeks comment 
on what modifications to FCC Form 470 (Description of Services 
Requested and Certification Form), which opens the competitive bidding 
process for E-Rate applicants, would reduce confusion for both 
applicants and service providers. Second, the Commission seeks comment 
on reducing the number of E-Rate forms by moving the information 
currently collected on FCC Form 486 (Receipt of Service Confirmation 
and Children's internet Protection Act Certification (CIPA) Form), 
which notifies USAC that services have started and that the applicant 
is in compliance with CIPA requirements, to other E-Rate forms.
    23. Creating an ``EZ'' Application Form. In comments to the Tribal 
E-Rate NPRM, E-Rate participants explained that small library entities 
often require technical assistance to complete the FCC Form 471 
application. ALA suggests that the Commission ``create an `EZ' form 
with simple to understand language that also includes context-sensitive 
guidance and best practices to support applicants, such as including 
checklists and prompts to help users navigate and raise any flags for 
potentially incorrect entry of information.'' The Commission seeks 
comment on this proposal and how to implement it effectively. Would 
such a form be available to all applicants, or would it be preferable 
to have a form targeted to Tribal entities or libraries? Is there any 
language on the FCC Form 471 application in particular that should be 
changed? Is any information collected on the form no longer needed? Is 
there additional information that should be collected to help 
streamline the application process? For example, should the Commission 
add the information currently collected on FCC Form 486 to FCC Form 471 
instead? What questions are confusing to small entities, and what type 
of questions do small applicants require technical assistance with? 
Would additional system pop-ups and guidance within the online 
application form make a significant difference in encouraging new, 
small entities to apply and request funding through the E-Rate program?
    24. Simplifying the FCC Form 470 Drop-Down Menu Options. In 2014, 
the Commission required all applicants and service providers to 
electronically file all E-Rate-related documents with USAC, adopted 
changes to the competitive bidding requirements for certain category 
one services, and amended the category two rules to fund additional 
services, such as managed internal broadband services (MIBS). As a 
result of those changes, FCC Form 470 currently has drop-down menu 
options that allow applicants to pick the services for which they are 
seeking bids in order to make it easier for service providers to search 
and locate relevant FCC Forms 470 to submit bids for. Despite efforts 
to improve the drop-down menu options, applicants and service providers 
continue to request changes to the drop-down menu options, and express 
concerns that selecting the wrong drop-down menu option(s) can result 
in a funding denial. Under the E-Rate program rules, applicants must 
conduct a fair and open competitive bidding process, seeking bids on 
FCC Form 470 with, at a minimum, a list of specified services for which 
the entity is requesting bids and sufficient information to enable 
bidders to reasonably determine the needs of the applicant. Under this 
rule, the Bureau has denied requests for review from petitioners denied 
funding for failing to seek competitive bids on their FCC Forms 470 for 
services requested on the FCC Forms 471. In addition, the Commission 
has established certain competitive bidding requirements for certain 
services, like managed internal broadband services and self-provisioned 
networks, in order to ensure applicants select the most cost-effective 
service option. The Commission therefore seeks comment on proposals 
from the Joint Commenters for changes to the drop-down menu options.
    25. First, for category two services, the Joint Commenters propose 
that the three separate Service Types: (1) Internal Connections; (2) 
Managed Internal Broadband Services; and (3) Basic Maintenance of 
Internal Connections be combined or revised in order to reduce the 
likelihood that applicants select the wrong Service Type by accident. 
The Commission seeks comment on this approach from both applicants and 
service providers. Are the category two services subcategories useful 
in determining the needs of the applicant? Or would a category two 
services narrative section be sufficient to ensure that applicants are 
providing sufficient information regarding the specified

[[Page 53844]]

equipment and services requested? For software-based services and 
licenses, as explained, the Commission understands that it is sometimes 
challenging for new applicants to determine which subcategory to use 
for the software or licenses needed for the category two internal 
connections equipment. However, if an applicant is seeking bids for 
specific pieces of equipment or for basic maintenance in the form of 
physical repair of the equipment, is information included in a 
narrative box sufficient for service providers to find and understand 
precisely what service(s) are being requested? Should the Commission 
consider a method for applicants to tag requests as potentially one 
particular type of service to assist service providers in finding the 
relevant requests for bids? How does the Commission weigh the benefits 
of a drop-down menu to service providers in finding and responding to 
FCC Forms 470 against the burden on applicants to determine the correct 
menu option(s) to use for the requested equipment and services?
    26. Second, the Joint Commenters propose that the Commission again 
modify the FCC Form 470 drop-down menu options for category one 
services. Over the last several funding years, the Bureau and USAC have 
taken steps to improve the category one drop-down menu options to 
reduce applicant confusion. In funding year 2022, after seeking comment 
from E-Rate participants, the drop-down menu options specifically 
listing ``Leased Lit Fiber'' were modified as a result of continued 
confusion. The Joint Commenters now seek new drop-down menu options for 
``internet service over fiber facilities'' and ``data transmission over 
fiber facilities.'' For instance, the Joint Commenters state that the 
USAC guidance on seeking bids for data transmission without internet 
access over fiber is unclear. The Commission seeks comment on this 
proposal. Based on the continued confusion from changes to FCC Form 
470, the Commission is concerned that further changes to the drop-down 
menu options could result in greater applicant confusion. Are there 
ways to capture concerns about the drop-down options language without 
making additional changes? For example, can USAC add more guidance 
within the online FCC Form 470 or in trainings? Finally, are there any 
other ways the Commission could improve existing drop-down menu options 
for E-Rate applicants or participants?
    27. Modifying or Eliminating FCC Form 486. The Commission seeks 
comment on whether to eliminate FCC Form 486 and move the information 
collected on that form to FCC Form 471 or remove some of the 
information collected on the form. FCC Form 486 notifies USAC that 
services have started for the recipients of service included on an 
approved funding request and the status of compliance with CIPA for the 
recipients of service for the funding requests. It must be filed after 
USAC issues a funding commitment decision letter, but no later than 120 
days after the service start date or 120 days after the funding 
commitment decision letter, whichever date is later. Invoicing cannot 
begin until FCC Form 486 is filed by the applicant.
    28. FCC Form 486 has included a number of program certifications 
over the years, such as whether technology plans are in place, but 
currently only collects information related to the services' start 
dates and CIPA compliance. These certifications now occur in the middle 
of the application cycle and can result in funding reductions due to 
ministerial or clerical errors. The Commission seeks comment on moving 
the CIPA certifications to FCC Form 471 and removing the requirement to 
notify USAC that services have started. The Joint Commenters explain 
that this would be a ``simple, yet effective way to streamline the 
program for all applicants and the Administrator, but particularly for 
small and new applicants.'' For the vast majority of applicants that 
are already in compliance with CIPA, the location of this CIPA 
certification should make no difference. While removing the requirement 
to notify USAC that services have started removes one possible check 
for USAC, the certifications on the requests for reimbursement forms 
already require services to have been delivered in order to seek 
funding, potentially making the additional notification about the start 
of services duplicative. If FCC Form 486 is removed for future funding 
years, how should the Commission modify the certifications on FCC Form 
472 or FCC Form 474 to ensure services and/or equipment were delivered 
to and used by eligible entities? If the Commission makes changes to 
FCC Form 486, should it also make changes to the invoice filing 
deadline to link the deadline to the date of the funding commitment 
decision letter? The rules currently reference the date of the FCC Form 
486 Notification Letter. Alternatively, the Joint Commenters suggest 
that the CIPA certifications be moved to FCC Form 471 but allow FCC 
Form 486 to remain as an option. While the Commission may need to 
retain FCC Form 486 for prior funding years where the certifications 
were not included on that funding year's FCC Form 471, the Commission 
seeks more detailed comment about the benefits of keeping FCC Form 486 
as an optional form for future funding years.
    29. Are there other E-Rate form changes that could help streamline 
application and reimbursement processes for the program? The Commission 
seeks comment on other E-Rate form modifications, particularly those 
that would help a new entity or a small or Tribal entity to apply for 
and receive E-Rate support. The Commission encourages commenters to 
provide sufficient detail for us to adopt changes to the E-Rate forms 
in upcoming funding years.
    30. Validating Discount Rate. The Commission next seeks comment on 
potential ways to streamline the discount rate validation for E-Rate 
applicants. Eligible schools and libraries may receive discounts 
ranging from 20% to 90% of the pre-discount price of eligible equipment 
and services, based on indicators of need. Schools and libraries in 
areas with higher percentages of students eligible for free or reduced 
price lunch through the National School Lunch Program (NSLP) or an 
alternative mechanism qualify for higher discounts for E-Rate eligible 
services and equipment than applicants with lower levels of eligibility 
for such programs. For example, the most disadvantaged schools, where 
at least 75% of students are eligible for free or reduced price school 
lunch, receive E-Rate support for 90% of the cost of their eligible 
category one purchases (that is referred to as a 90% discount). 
Libraries receive funding at the discount level of the school district 
in which they are located. Schools and libraries located in rural areas 
also may receive an additional 5% to 10% discount compared to entities 
located in urban areas. During the application review, USAC may seek 
data to validate an entity's discount rate, which is typically based on 
student enrollment and NSLP data as of October 1 prior to the filing of 
the application.
    31. The Commission now seeks comment on how to streamline the 
discount rate validation process for E-Rate applicants. For the 
majority of applicants, their discounts do not change from funding year 
to funding year. Absent a request for an increase in an entity's 
discount rate, should the Commission adopt a presumption that discount 
rates do not require validation for a certain period of time (e.g., 
three or five funding years)? Under such a

[[Page 53845]]

presumption, the Commission would still need to occasionally check for 
certain aspects of the calculation, like when new rurality data becomes 
available from the U.S. Census. How does the Commission factor in such 
changes? Alternatively are there other changes to the discount rate the 
Commission should consider? The Commission also seeks comment on any 
relevant changes to the Community Eligibility Provision (CEP), how it 
may impact the E-Rate program discounts, and whether any procedures 
should be changed. Are there any changes the Commission should consider 
for states and schools in states with statewide CEP or statewide free 
lunch calculating their discount?
    32. Seeking Information on Other College Libraries Acting as Public 
Libraries. The Commission also seeks comment on whether there are other 
college or university libraries, similar to the TCU libraries, that act 
as the public library in their community. While the Commission 
continues to monitor whether TCU libraries participate successfully in 
the E-Rate program, it seeks data and examples from stakeholders about 
whether this is common in other types of college or university 
libraries and whether it should consider further changes to its 
eligibility rules for libraries. One commenter suggested expanding 
eligibility to other college libraries that serve as public libraries 
in their communities. If the Commission does, what other additional 
restrictions or limitations should be considered? Are colleges that 
specifically serve communities that have been historically underserved, 
marginalized, or adversely affected by persistent poverty or 
inequality, such as Historically Black Colleges and Universities 
(HBCUs) or Hispanic-Serving institutions (HSIs), also serving as public 
libraries in any instances?
    33. Modifying E-Rate Invoice and Disbursement Standards. Modifying 
the Invoice Filing Deadline Rule. Before 2014, invoice filing deadlines 
were procedural, and applicants or service providers could request and 
receive a 120-day invoice filing extension under certain conditions. 
USAC granted invoice filing extension requests that met the criteria, 
including requests made up to a year after the original invoice filing 
deadline. In the First 2014 E-Rate Order, 79 FR 49160 (8/19/2014), the 
Commission codified the invoice filing deadline, and adopted a strict 
standard for waiving the rule and granting extensions of the applicable 
invoice filing deadline. Specifically, the Commission's rules only 
permit USAC to grant a single 120-day extension of an invoice filing 
deadline, provided that the applicant or service provider submits the 
request on or before the invoice filing deadline for that request. USAC 
will automatically grant timely filed invoice filing deadline extension 
requests. In the interest of efficient program administration, however, 
the Commission prohibited USAC from granting any additional invoice 
filing deadline extensions. As a result, if applicants and service 
providers require more time than the single 120-day extension to 
complete the invoicing process, they may only obtain it by seeking a 
waiver of the invoice filing deadline extension rule from the 
Commission. The Commission concluded, however, that ``it is generally 
not in the public interest to waive [the] invoicing rules,'' and the 
Bureau should grant waivers of the invoice filing deadline rules only 
under ``extraordinary circumstances.''
    34. As a result of this standard, applicants and service providers 
have filed large numbers of waivers related to invoicing errors. Under 
the extraordinary circumstances standard, the Bureau has denied many of 
those waiver requests. The Commission now seeks comment on the Joint 
Commenters' proposal to slightly modify the invoice filing deadline 
extension rule. Specifically, they propose that applicants be allowed 
to seek an extension of the original invoice deadline from USAC when 
the request is made within 15 days of the original invoice filing 
deadline date. This change would allow applicants or service providers 
to request a one-time 120 day extension if they realize they just 
missed an invoice filing deadline, reducing the number of denied 
requests for reimbursements and waiver requests, while maintaining the 
codified invoice filing deadline, as the new invoice filing deadline 
would remain 120 days from the original invoice filing deadline, and 
not based on the date the extension request was filed with USAC. 
Because the Commission is revisiting its overall approach to the 
invoice filing deadline, the Commission also modifies, on an interim 
basis, the prior guidance provided to the Bureau regarding waivers of 
the existing deadline. In particular, the Bureau remains free to grant 
waivers that would have been granted under the prior Commission 
guidance as meeting the extraordinary circumstances standard. The 
Commission directs the Bureau to leave pending any waiver requests 
related to applicants or service providers that were filed within 15 
days of the original invoice filing deadline for now, and it will 
provide further guidance regarding the disposition of those waiver 
requests at the resolution of this proceeding. While the Commission 
declines to waive the invoice deadline rule during the pendency of the 
rulemaking, it seeks comment on the extraordinary circumstances 
standard.
    35. Consistent with this proposal, the Commission also seeks 
comment on other ways to simplify or streamline the E-Rate invoicing 
and disbursement process. Should the Commission consider a 30-day grace 
period for applicants or service providers to resubmit invoices that 
were timely filed before the invoice filing deadline, but rejected in 
whole or part after the deadline has passed? Currently, applicants and 
service providers may appeal a rejected or denied invoice, but cannot 
resubmit the invoice filing if the deadline has passed. Applicants and 
service providers are encouraged to provide examples of why filing an 
appeal after the invoice filing deadline is not the most 
straightforward approach. Are there processes and requirements in the 
program that the Commission should consider changing in order to reduce 
the amount of work required by small applicants regarding the E-Rate 
reimbursement process? Are there particular situations where one 
extension is insufficient for requesting reimbursement from the E-Rate 
program?
    36. The Commission also seeks comment on a billing issue that could 
complicate service provider invoicing for some applicants. E-Rate 
applicants may select one of two ways to seek reimbursement of the 
costs of eligible E-Rate equipment and services. If an applicant pays 
the full cost of the equipment and services upfront, then the applicant 
must submit an FCC Form 472, the Billed Entity Applicant Reimbursement 
(BEAR) form, to request reimbursement for the discounted share of the 
costs from USAC. If an applicant only pays its service provider the 
non-discounted share of the cost of the eligible equipment and 
services, then the service provider must file an FCC Form 474, the 
Service Provider Invoice (SPI) form, to receive reimbursement of the 
discounted share of the costs directly from USAC. Although the BEAR 
invoicing rules were modified in the First 2014 E-Rate Order, to allow 
applicants to receive direct reimbursement from USAC, service providers 
have continued invoicing applicants for the full cost of the E-Rate 
services and then provide a credit to the applicant after receiving 
reimbursement of the discounted share of costs for the

[[Page 53846]]

equipment and services through SPI invoicing from USAC.
    37. This practice by certain service providers of requiring the 
applicant to pay the full cost of the E-Rate services upfront when the 
applicant has elected SPI billing and is only required to pay the 
service the non-discounted share of costs is contrary to the clear 
intent of allowing SPI billing and the Commission's rules. As the 
Commission explained in the Second Report and Order, ``requiring 
schools and libraries to pay in full could create serious cash flow 
problems for many schools and libraries and would disproportionately 
affect the most disadvantaged schools and libraries.'' The Commission 
explained that ``many applicants cannot afford to make the upfront 
payments that the BEAR method requires'' and concluded ``the potential 
harm to schools and libraries from being required to make full payment 
upfront, if they are not prepared to, justifies giving applicants the 
choice of payment method.'' The Commission therefore seeks comment on 
amending its rules and certifications to make them consistent with the 
Commission's intent that applicants who select the SPI invoicing method 
must only pay their service provider for the non-discounted share of 
the costs of the eligible equipment and services, and the service 
provider must seek the remaining discounted portion of costs from USAC 
and may not require full payment from the applicant as well when the 
SPI invoicing method is used.
    38. Seeking Comment on Program Recoveries. In 2000, the Commission 
set up a framework for recovering funds committed or disbursed in 
violation of the Act and the Commission's rules. USAC implemented a 
process for recovering funds disbursed in violation of statutory and 
rule violations and, in 2004, as part of the Fifth Report and Order, 69 
FR 55097 (09/13/2004), the Commission largely affirmed and further 
refined USAC's approach when determining what amounts should be 
recovered by USAC and the Commission when funds have been disbursed in 
violation of the Commission's E-Rate program rules. In particular, the 
Commission amended its rules to apply the red light rule to E-Rate 
applicants and service providers. Commenters note that the recovery 
process can be confusing, leading to untimely appeals and applications 
being dismissed. Specifically, commenters raised challenges with USAC 
dismissing pending ``requests for funding commitments'' if a delinquent 
debt is not paid within 30 days of the notice provided for in the 
commitment adjustment procedures.'' The Commission therefore seeks 
comment on whether deferring action on pending E-Rate submissions 
without dismissing them would be appropriate while participants are on 
red light status. If so, what limits should be imposed to ensure timely 
action on the delinquent debt?
    39. Updating E-Rate Program Definitions. Finally, the Commission 
seeks comment on changes to some of the program's definitions that may 
be causing confusion or no longer be as relevant to the current 
program. The Commission also encourages E-Rate participants to provide 
other cleanup suggestions for the program rules.
    40. Wiring Between Buildings. The Commission next seeks comment on 
amending the definition of ``internal connections'' and ``wide area 
network'' to allow applicants to seek funding for wiring between 
different schools in the same contiguous area as an internal 
connection. In funding year 2017, the Bureau modified the Eligibles 
Services List to provide guidance on the classifications of connections 
between buildings of a single school. In that guidance, the Bureau 
noted that ``[c]onnections between different schools with campuses 
located at the same property (e.g., an elementary school and middle 
school located on the same property) are considered to be category one 
digital transmission services.'' In funding year 2018, the Bureau 
further clarified that connections between two schools in a single 
building may be classified as a category two service, but rejected 
requests to allow the term ``single school campus'' in the definition 
of ``internal connections'' as allowing for a single campus containing 
multiple schools. Applicants remain frustrated that cabling between two 
schools (e.g., a high school and an elementary school) in the same 
location be considered category one services, which under current 
rules, has separate competitive bidding requirements.
    41. The Joint Commenters suggest that applicants should be 
permitted to use their category two funding to pay for cabling between 
two different schools located in the same contiguous area, if desired. 
The Commission therefore proposes to modify the definitions of 
``internal connections'' and ``wide area network'' to allow multiple 
schools (e.g., a high school and a middle school) to share a campus by 
removed the word ``single'' from each definition. The Commission seeks 
comment on this proposal or on alternative ways to modify the rules 
governing which category of service wiring should be considered. Would 
this raise new issues for these types of connections? Are there simpler 
ways to handle this issue? For instance, would it be more 
straightforward to draw the line between Internal Connections and WANs 
at the building? The issue identified by the Joint Commenters would 
remain, but the overall policy determination would be simpler. The 
Commission also seeks comment on removing references to ``voice'' in 
the definition of ``wide area network.''
    42. Definition of Consortium. The Commission also seeks comment on 
amending the definition of ``consortium'' and whether to align it with 
the definition of ``consortium'' used in the Emergency Connectivity 
Fund program. The Commission's E-Rate rules only allow ineligible 
private sector entities to join consortia if the pre-discount prices 
for interstate services are at tariffed rates. Given that many services 
have been de-tariffed over the years, the Commission seeks comment on 
whether this language should be removed from the E-Rate definition of 
consortium and the definition be aligned with the ECF definition of 
consortium. If so, should the Commission continue to allow private 
entities to be in an E-Rate consortium? If the Commission were to allow 
ineligible entities to remain in E-Rate consortia should the limitation 
of ``pre-discount prices for interstate services are at tariffed 
rates'' be changed to another limitation as many services continue to 
be de-tariffed? The Commission also seeks comment on the potential 
advantages and disadvantages of permitting private sector entities to 
join E-Rate consortia. Is there any data or other information showing 
the impact on connectivity or pricing by allowing private sector 
entities to be in E-Rate consortia? What safeguards would the 
Commission have to put in place to ensure that the E-Rate program does 
not support services used by ineligible entities and to ensure 
ineligible entities are paying for their share of the consortium's 
costs? The Commission seeks comment on its proposal to remove this 
language and align the E-Rate definition of consortium with the ECF 
definition of consortium. If the Commission is to continue to include 
ineligible entities as member of E-Rate consortia, what limitations and 
restrictions should be adopted to ensure E-Rate funding is not being 
used to pay for the services of the ineligible consortia members? The 
Commission seeks comment on these questions.
    43. The Commission, as part of its continuing effort to advance 
digital equity for all, including people of color,

[[Page 53847]]

persons with disabilities, persons who live in rural or Tribal areas, 
and others who are or have been historically underserved, marginalized, 
or adversely affected by persistent poverty or inequality, invites 
comment on any equity-related considerations and benefits (if any) that 
may be associated with the proposals and issues discussed herein. 
Specifically, the Commission seeks comment on how its proposals may 
promote or inhibit advances in diversity, equity, inclusion, and 
accessibility, as well the scope of the Commission's relevant legal 
authority.

III. Procedural Matters

A. Paperwork Reductions Act Analysis

    44. The Further Noticed of Proposed Rulemaking seeks comment on 
possible modified information collection requirements. The Commission, 
as part of its continuing effort to reduce paperwork burdens, invites 
the general public and the Office of Management and Budget (OMB) to 
comment on the information collection requirements contained in this 
document, as required by the Paperwork Reduction Act of 1995, Public 
Law 104-13. In addition, pursuant to the Small Business Paperwork 
Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), the 
Commission seeks specific comment on how to further reduce the 
information collection burden for small business concerns with fewer 
than 25 employees.
    45. Ex Parte Rules--Permit but Disclose. Pursuant to Sec.  
1.1200(a) of the Commission's rules, the Further Notice of Proposed 
Rulemaking shall be treated as a ``permit-but-disclose'' proceeding in 
accordance with the Commission's ex parte rules. Persons making ex 
parte presentations must file a copy of any written presentation or a 
memorandum summarizing any oral presentation within two business days 
after the presentation (unless a different deadline applicable to the 
Sunshine period applies). Persons making oral ex parte presentations 
are reminded that memoranda summarizing the presentation must (1) list 
all persons attending or otherwise participating in the meeting at 
which the ex parte presentation was made, and (2) summarize all data 
presented and arguments made during the presentation. If the 
presentation consisted in whole or in part of the presentation of data 
or arguments already reflected in the presenter's written comments, 
memoranda or other filings in the proceeding, the presenter may provide 
citations to such data or arguments in his or her prior comments, 
memoranda, or other filings (specifying the relevant page and/or 
paragraph numbers where such data or arguments can be found) in lieu of 
summarizing them in the memorandum. Documents shown or given to 
Commission staff during ex parte meetings are deemed to be written ex 
parte presentations and must be filed consistent with rule Sec.  
1.1206(b) of the Commission's rules. In proceedings governed by the 
Commission's rules Sec.  1.49(f) or for which the Commission has made 
available a method of electronic filing, written ex parte presentations 
and memoranda summarizing oral ex parte presentations, and all 
attachments thereto, must be filed through the electronic comment 
filing system available for that proceeding, and must be filed in their 
native format (e.g., .doc, .xml, .ppt, searchable.pdf). Participants in 
this proceeding should familiarize themselves with the Commission's ex 
parte rules.
    46. In light of the Commission's trust relationship with Tribal 
Nations and its commitment to engage in government-to-government 
consultation with them, the Commission finds the public interest 
requires a limited modification of the ex parte rules in this 
proceeding. Tribal Nations, like other interested parties, should file 
comments, reply comments, and ex parte presentations in the record to 
put facts and arguments before the Commission in a manner such that 
they may be relied upon in the decision-making process consistent with 
the requirements of the Administrative Procedure Act. However, at the 
option of the Tribe, ex parte presentations made during consultations 
by elected and appointed leaders and duly appointed representatives of 
federally recognized Indian Tribes and Alaska Native Villages to 
Commission decision makers shall be exempt from the rules requiring 
disclosure in permit-but-disclose proceedings and exempt from the 
prohibitions during the Sunshine Agenda period. To be clear, while the 
Commission recognizes consultation is critically important, the 
Commission emphasizes that the Commission will rely in its decision-
making only on those presentations that are placed in the public record 
for the proceeding.

B. Initial Regulatory Flexibility Analysis

    47. As required by the Regulatory Flexibility Act of 1980, as 
amended (RFA), the Commission has prepared this Initial Regulatory 
Flexibility Analysis (IRFA) of the possible significant economic impact 
on a substantial number of small entities by the policies and rules 
proposed in the FNPRM. Written public comments are requested on this 
IRFA. Comments must be identified as responses to the IRFA and must be 
filed by the deadlines for comments in the FNPRM. The Commission will 
send a copy of the FNPRM, including this IRFA, to the Chief Counsel for 
Advocacy of the Small Business Administration (SBA). In addition, the 
FNPRM and IRFA (or summaries thereof) will be published in the Federal 
Register.
    48. The Commission's E-Rate program, formally known as the schools 
and libraries universal service support mechanism, provides support to 
schools and libraries allowing them to obtain affordable, high-speed 
broadband services and internal connections, which enables them to 
connect students and library patrons to critical next-generation 
learning opportunities and services. In the Tribal E-Rate NPRM, the 
Commission's primary objectives were to address the underrepresentation 
of Tribal applicants and increase participation of Tribal libraries. To 
achieve these objectives, the Tribal E-Rate NPRM explored ways to 
further simplify the E-Rate program rules, reduce program barriers and 
burdens, and encourage greater Tribal participation and community 
representation.
    49. In response to the Tribal E-Rate NPRM, the Commission received 
several comments suggesting ways to streamline or simplify aspects of 
the E-Rate program overall for all schools and libraries. In order to 
develop the record further on those comments, the Commission is now 
seeking further comment on a series of proposed ways to improve the 
program for schools and libraries. First, the Commission seeks comment 
on updating the eligible services list by modifying the distinction 
between two types of eligible software, Internal Connections, such as 
the license to access software, and Basic Maintenance of Internal 
Connections (BMIC), which includes bug fixes, security patches, and 
technical assistance. The modification would allow applicants to 
receive full funding for BMIC services in the first year of the 
contract, instead of splitting it across multiple years. The Commission 
also seeks comment on the best method to aid applicants that are 
transitioning between two service providers during the same funding 
year. The Commission requests comment on ways applicants may seek 
services from multiple suppliers without being deemed duplicative 
services. The Commission also seeks information on other changes to 
help simplify the program, particularly for new and smaller applicants, 
such as revising the list of

[[Page 53848]]

eligible services to the same terms used on FCC Forms 470 or 471. The 
Commission also seeks comment on changing or clarifying the competitive 
bidding requirements in order to streamline aspects of the application 
process.
    50. In addition, the Commission requests comment on creating a 
competitive bidding exemption for E-Rate funding requests under 
$10,000. In an effort to allow applicants flexibility in anticipating 
changes in bandwidth needs, the Commission seeks comment on how to 
increase bandwidth during the school year without requiring competitive 
bidding for the service. The Commission also seeks comment on when an 
applicant's change to FCC Form 470 or a related request for proposals 
(RFP) will require it to restart the competitive bidding process. The 
Commission requests information on automated bid and spam bid 
responses, and bid deadlines, and whether to expand evidence of a 
legally binding agreement to include board minutes approving a 
contract.
    51. To streamline the E-Rate program forms, the Commission requests 
comment on modifications such as creating an ``EZ'' application form in 
plain language, adding navigation prompts that alert for potential 
entry errors, and updating drop down menu options on FCC Form 470, 
which is used to seek competitive bids, to reduce applicant confusion. 
The Commission also seeks comment on modifying FCC Form 470, or 
eliminating FCC Form 486, which is used to notify the Universal Service 
Administrative Company (USAC) that services have started and collect a 
certification of compliance with the Children's internet Protection Act 
Certification (CIPA).
    52. The Commission seeks comment on streamlining how often it 
calculates and validates discount rates for applicants, and on 
modifying the deadline for requesting an invoice deadline extension, in 
order to reduce the number of applicants that are unable to get a 
program disbursement due to small errors near the invoice deadline. The 
Commission also requests information on amending its rules to address 
billing issues that would change requiring applicants to make full, up-
front payments under certain billing methods. Finally, the Commission 
seeks comment on updating E-Rate program definitions to make it easier 
to build local networks in areas where two schools share a location, 
and reflect Tribal procurement rules.
    53. The proposed action is authorized pursuant to sections 1 
through 4, 201-202, 254, 303(r), and 403 of the Communications Act of 
1934, as amended, 47 U.S.C. 151-154, 201-202, 254, 303(r), and 403.
    54. The RFA directs agencies to provide a description of and, where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules, if adopted. The RFA generally defines 
the term ``small entity'' as having the same meaning as the terms 
``small business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small business concern'' under the Small Business 
Act. A small business concern is one that: (1) is independently owned 
and operated; (2) is not dominant in its field of operation; and (3) 
satisfies any additional criteria established by the Small Business 
Administration (SBA).
    55. The Commission's actions, over time, may affect small entities 
that are not easily categorized at present. The Commission therefore 
describes, at the outset, three broad groups of small entities that 
could be directly affected herein. First, while there are industry 
specific size standards for small businesses that are used in the 
regulatory flexibility analysis, according to data from the Small 
Business Administration's (SBA) Office of Advocacy, in general a small 
business is an independent business having fewer than 500 employees. 
These types of small businesses represent 99.9% of all businesses in 
the United States, which translates to 33.2 million businesses.
    56. Next, the type of small entity described as a ``small 
organization'' is generally ``any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field.'' 
The Internal Revenue Service (IRS) uses a revenue benchmark of $50,000 
or less to delineate its annual electronic filing requirements for 
small exempt organizations. Nationwide, for tax year 2020, there were 
approximately 447,689 small exempt organizations in the U.S. reporting 
revenues of $50,000 or less according to the registration and tax data 
for exempt organizations available from the IRS.
    57. Finally, the small entity described as a ``small governmental 
jurisdiction'' is defined generally as ``governments of cities, 
counties, towns, townships, villages, school districts, or special 
districts, with a population of less than fifty thousand.'' U.S. Census 
Bureau data from the 2017 Census of Governments indicate there were 
90,075 local governmental jurisdictions consisting of general purpose 
governments and special purpose governments in the United States. Of 
this number, there were 36,931 general purpose governments (county, 
municipal, and town or township) with populations of less than 50,000 
and 12,040 special purpose governments--independent school districts 
with enrollment populations of less than 50,000. Accordingly, based on 
the 2017 U.S. Census of Governments data, the Commission estimates that 
at least 48,971 entities fall into the category of ``small governmental 
jurisdictions.''
    58. Small entities potentially affected by the rules herein include 
Schools, Libraries, Wired Telecommunications Carriers, All Other 
Telecommunications, Wireless Telecommunications Carriers (except 
Satellite), Wireless Telephony, Wired Broadband internet Access Service 
Providers (Wired ISPs), Wireless Broadband internet Access Service 
Providers (Wireless ISPs or WISPs), internet Service Providers (Non-
Broadband), Vendors of Infrastructure Development or Network Buildout, 
Telephone Apparatus Manufacturing, and Radio and Television 
Broadcasting and Wireless Communications Equipment Manufacturing.
    59. The potential rule changes discussed in the FNPRM if adopted, 
could impose some new or modified reporting, recordkeeping or other 
compliance requirements on small entities. However, since the purpose 
of the FNPRM is to streamline and simplify procedures, and improve the 
E-Rate program processes, the Commission anticipates that the rule 
modifications that may result from the matters upon which the 
Commission is seeking comment should reduce the economic impact of 
current compliance obligations on small entities. For example, 
modifications to funding for BMIC services would allow applicants that 
are small entities to receive full funding for these services during 
the first year of the contract, instead of splitting funding across 
multiple years, reducing operational costs. Revising the list of 
eligible services to the same terms used on FCC Forms 470 or 471 could 
simplify the application process for new and small applicants. 
Exempting small libraries from the competitive bidding process when 
requested funding is less than $10,000 would ease compliance burdens 
for these small entities. The Commission also seeks comment on 
eliminating the need to file a form before beginning to invoice the 
program.
    60. In the FNPRM the Commission inquires whether there are other 
rule changes to the application, invoicing, or other administrative 
processes in the E-Rate program that could be made to specifically help 
new and smaller

[[Page 53849]]

schools and libraries. For example, creating an ``EZ'' application form 
in plain language and navigation prompts that alert for potential entry 
errors, as well as updating drop down menu options on FCC Form 470, may 
reduce operational and implementation costs for small applicants. 
Moving CIPA certifications to FCC Form 471 and removing USAC 
notification through FCC Form 486 would reduce reporting obligations 
for small entities. In response to comments to the FNPRM or this IRFA, 
the Commission may simplify and change the forms that applicants use to 
apply for the E-Rate program as well as modify filing and other 
administrative requirements, which should ease reporting, 
recordkeeping, and other compliance requirements for small entities.
    61. In assessing the cost of compliance for small entities, at this 
time the Commission cannot quantify the cost of compliance with any of 
the potential rule changes that may be adopted. Additionally, the 
Commission is not in a position to determine whether, if adopted, the 
proposals and matters upon which the Commission seeks comment in the 
FNPRM will require small entities to hire professionals to comply. 
However, consistent with the Commission's objectives to streamline and 
simplify the E-Rate program processes and procedures, the Commission 
does not anticipate that small entities will be required to hire 
professionals to comply with any rule modifications it adopts. The 
Commission expects the information it receives in comments including 
where requested, cost information, will help the Commission identify 
and evaluate relevant compliance matters for small entities, including 
compliance costs and other burdens that may result from potential 
changes discussed in the FNPRM.
    62. The RFA requires an agency to describe any significant, 
specifically small business, alternatives that it has considered in 
reaching its proposed approach, which may include the following four 
alternatives (among others): ``(1) the establishment of differing 
compliance or reporting requirements or timetables that take into 
account the resources available to small entities; (2) the 
clarification, consolidation, or simplification of compliance and 
reporting requirements under the rule for such small entities; (3) the 
use of performance rather than design standards; and (4) an exemption 
from coverage of the rule, or any part thereof, for such small 
entities.''
    63. In the FNPRM, the Commission takes steps to minimize the 
economic impact on small entities from the changes to the E-Rate 
program on which it seeks comment. Specifically, each of the subjects 
on which the Commission seeks comment was identified by an E-Rate 
participant as a potential way to simplify the program in large or 
small ways and should lessen the economic impact on small entities. The 
Commission expects the comments received in response will allow us to 
consider ways to minimize the economic impact and explore alternatives 
to improve and simplify how small entities participate in the E-Rate 
program.
    64. For example, in the FNPRM, the Commission explores ways to 
improve the process for applicants that have struggled with 
distinguishing how to apply for two different types of eligible 
software in the program, Internal Connections and BMIC, which is 
administratively more burdensome to request. If the applicant fails to 
file the competitive bidding forms for the right type of software, it 
can be denied funding even if the applicant otherwise applies 
correctly. If adopted some of the competitive bidding changes, such as 
exempting certain funding requests below $10,000, could result in less 
paperwork for small entities making low-cost purchases, and some of the 
form changes, such as creating the ``EZ'' application and adding plain-
language to FCC Forms 470 and 471, while eliminating filing FCC Form 
486, could reduce the number of forms that must be filed for all 
applicants, as well as reduce the number of applicants penalized for 
filing such forms past their deadline.
    65. The Commission considered and seeks comment to the invoice 
deadline extension rule, beyond the single 120-day extension, in order 
to reduce the number of applicants and service providers that have 
invoices denied because they missed the deadline by a short period of 
time. All of these, and the other proposals on which the Commission 
seeks comment, would reduce costs for small entities.
    66. None.

IV. Ordering Clauses

    67. Accordingly, it is ordered, that pursuant to the authority 
contained in sections 1 through 4, 201-202, 254, 303(r), and 403 of the 
Communications Act of 1934, as amended, 47 U.S.C. 151-154, 201-202, 
254, 303(r), and 403, this Further Notice of Proposed Rulemaking IS 
ADOPTED effective September 8, 2023.
    68. It is further ordered that the Office of the Secretary, 
Reference Information Center, SHALL SEND a copy of the Further Notice 
of Proposed Rulemaking, including the Initial Regulatory Flexibility 
Act Analysis, to the Chief Counsel for Advocacy of the Small Business 
Administration.

List of Subjects in 47 CFR Part 54

    Communications common carriers, internet, Libraries, Reporting and 
recordkeeping requirements, Schools, Telecommunications, Telephone.

Federal Communications Commission.
Marlene Dortch,
Secretary.

Proposed Rules

    For the reasons discussed above, the Federal Communications 
Commission proposes to amend 47 CFR part 54 as follows:

PART 54--UNIVERSAL SERVICE

0
1. The authority citation for part 54 continues to read as follows:

    Authority: 47 U.S.C. 151, 154(i), 155, 201, 205, 214, 219, 220, 
229, 254, 303(r), 403, 1004, 1302, 1601-1609, and 1752, unless 
otherwise noted.
0
2. Section 54.500 is amended by revising the definitions of 
``Consortium,'' ``Internal Connections,'' and ``Wide Area Network'' to 
read as follows:


Sec.  54.500  Terms and definitions.

* * * * *
    Consortium. A ``consortium'' is any local, statewide, regional, or 
interstate cooperative association of schools and/or libraries eligible 
for E-rate support that seeks competitive bids for eligible services or 
funding for eligible services on behalf of some or all of its members. 
A consortium may also include health care providers eligible under 
subpart G of this part, and public sector (governmental) entities, 
including, but not limited to, state colleges and state universities, 
state educational broadcasters, counties, and municipalities, although 
such entities are not eligible for support.
* * * * *
    Internal Connections. A service is eligible for support as a 
component of an institution's ``internal connections'' if such service 
is necessary to transport or distribute broadband within one or more 
instructional buildings of a school campus or within one or more non-
administrative buildings that comprise a single library branch.
* * * * *
    Wide Area Network. For purposes of this subpart, a ``wide area 
network'' is a data network that provides connections from one or more 
computers within an eligible school or library to one or more computers 
or

[[Page 53850]]

networks that are external to such eligible school or library. Excluded 
from this definition is a data network that provides connections 
between or among instructional buildings of a school campus or between 
or among non-administrative buildings of a single library branch.
0
3. Section 54.503 is amended by revising paragraph (b) to read as 
follows:


Sec.  54.503  Competitive bidding requirements.

* * * * *
    (b) Competitive bid requirements. Except as provided in Sec.  
54.511(c), an eligible school, library, or consortium that includes an 
eligible school or library shall seek competitive bids, pursuant to the 
requirements established in this subpart, for all services eligible for 
support under Sec.  54.502. These competitive bid requirements apply in 
addition to state, local, and Tribal competitive bid requirements and 
are not intended to preempt such state, local, or Tribal requirements.
* * * * *
0
4. Section 54.504 is amended by revising paragraphs (d)(1)(iv) and 
(d)(2) to read as follows:


Sec.  54.504   Requests for services.

* * * * *
    (d) * * *
    (1) * * *
    (iv) The applicant certifies that the requested change is either 
within the scope of the controlling FCC Form 470, including any 
associated Requests for Proposal, for the original services, or is the 
result of an unanticipated need for additional bandwidth and the 
applicant will seek competitive bids prior to the next funding year.
    (2) Except for documented cases of transitioning from one service 
provider to another service provider, in the event that a service 
substitution results in a change in the pre-discount price for the 
supported service, support shall be based on the lower of either the 
pre-discount price of the service for which support was originally 
requested or the pre-discount price of the new, substituted service.
* * * * *
0
5. Section 54.514 is amended by revising paragraphs (a)(2), (b), and 
(c) to read as follows:


Sec.  54.514   Payment for discounted services.

    (a) * * *
    (2) 120 days after the date of the Funding Commitment Decision 
Letter; or
* * * * *
    (b) Invoice deadline extension. Service providers or billed 
entities may request a one-time extension of the invoicing filing 
deadline if such request is filed within 15 days after the deadline 
calculated pursuant to paragraph (a) of this section. The Administrator 
shall grant a 120-day extension of the invoice filing deadline, if it 
is timely requested.
    (c) Choice of payment method. Service providers providing 
discounted services under this subpart in any funding year shall, prior 
to the submission of the FCC Form 471, permit the billed entity to 
choose the method of payment for the discounted services from those 
methods approved by the Administrator, including by making a full, 
undiscounted payment and receiving subsequent reimbursement of the 
discount amount from the Administrator or by making a discounted 
payment and the service provider receiving subsequent reimbursement of 
the remaining amount from the Administrator.

[FR Doc. 2023-16985 Filed 8-8-23; 8:45 am]
BILLING CODE 6712-01-P