Step 4 Applying for Discounts

Item 21 Attachments

Each Block 5 funding request on the FCC Form 471 (Description of Services Ordered and Certification Form) must include a description of the products and services for which discounts are sought. This description is known as an Item 21 Attachment. Beginning with Funding Year (FY) 2011, Item 21 Attachments must be submitted no later than the close of the FCC Form 471 application filing window.

Overview

Several different formats are possible for the Item 21 Attachments. However, the Item 21 Attachments generally consists of these parts:

• Narrative overview or description - a summary that allows USAC to understand the objective of the funding request. Examples include:
• "Additional email servers for three locations"
• "Internet access for new library branch"
• "New data distribution equipment to replace old equipment"
• Line item detail and cost associated with the eligible and ineligible products and services requested including:
• Quantity
• Product or service description
• Total unit cost
• Extended pre-discount cost (eligible and eligible non-recurring)
• Extended ineligible pre-discount cost (ineligible and ineligible non-recurring)
• The grand total
• Any additional details, if needed, such as equipment locations or other information to support the funding request. Products and services that can be supported under the Schools and Libraries Program are "conditionally eligible," which means that they are eligible for support if used or functions in certain ways.  The Item 21 Attachments are the applicant's opportunity to provide sufficient information so that USAC can make a determination about whether the applicant's proposal meets Federal Communications Commission (FCC) eligibility rules.

Applicants often receive the assistance of service providers in creating the Item 21 Attachments, which can be one or more of the following:

• An online submission
• Applicant-provided documentation
• A quote or bill from the vendor
• A copy of the contract for the service

Internal Connections

The instructions for FCC Form 471 indicate that internal connections funding requests must include information about where the physical components will be located. This is often the same as the location of entities that are receiving service, as indicated in Block 4 of FCC Form 471. In some cases, components can be installed in a location different than the entity receiving service, such as when components are located at a district office but serve the needs of one or more separate schools.

Examples of information that specify the physical location of internal connections products could be:

• "One router and associated components per school"
• "All equipment to be located at District Office"
• "Components to be located at entity number 12345"
• "One file server will be located at each location specified in Block 4, except three file servers will be installed at entity number 12345"

Examples of Item 21 Attachments

The examples below provide acceptable layouts and relevant information for the Item 21 Attachment.

• View an Item 21 Attachment that features Basic Maintenance of Internal Connections
• View an Item 21 Attachment that features Internal Connections
• View an Item 21 Attachment that features Internet Access services
• View an Item 21 Attachment that features Telecommunications Services

Representative Telephone Bills 

In addition to the above examples, an applicant may submit a previous, representative bill for telephone services or may include a listing of the previous year's charges in order to substantiate these charges for the next Funding Year (FY). To avoid delays in the review of your application, please ensure that the type of service is specified on your bill (local, long distance, cellular service etc.) and the number of phone lines is given. This information may be handwritten on the bill by the applicant if it does not already appear.

• View an Item 21 Attachment that is based on a representative previous phone bill

How to File

The Item 21 Attachment can be submitted online or manually submitted to USAC by email, fax, U.S. mail, courier, or as part of an FCC Form 471 application or FCC Form 471 Block 6 Certification submitted on paper. It is preferable for you to use no more than one of these methods to submit your Item 21 Attachments. 

For example, if you submit both an online and paper Item 21 Attachment but there are differences between the two documents with regard to items, cost or ineligibles, the processing of your application will be delayed.

The attachment should include this information:

• A label of "FCC Form 471 Item 21 Attachment"
• The applicant's name
• The Attachment Number specified for the Item 21 Attachment in the FCC Form 471, Block 5

If the Item 21 Attachment is being submitted separately from the FCC Form 471, then the attachment or a cover letter must also include:

• The applicant's Billed Entity Number (BEN)
• The FCC Form 471 application number if one was assigned through electronic filing or the FCC Form 471 Applicant Form Identifier if the FCC Form 471 was filed on paper

The Item 21 Attachment must be received before USAC can begin review of an FCC Form 471 application. For FY2011 the Item 21 Attachment is a window filing requirement and must be filed in a timely fashion so that USAC can review the information, make a determination of product and service eligibility, and provide a prompt funding decision.

If at the time of application review, the reviewer fails to see that an Item 21 Attachment has been filed, they may contact the applicant and request that this information be provided.

Email Submissions

Do not send submissions via email other than FCC Form 471 Item 21 Attachments. Documents may be sent in most commercially available word processing or spreadsheet formats. Scanned documents may also be sent (Tagged Image File Format (TIFF) is preferred). Total file size of the email message must be less than 10 Megabytes. If you have more than one FCC Form 471 application, do not combine Item 21 Attachments from other FCC Form 471 applications in the same email message.

Fax and U.S. Mail Submissions

Send submissions via fax to (973) 599-6511. Do not send submissions other than FCC Form 471 Item 21 Attachments to this fax number.

Send submissions via USPS to:

SLD Forms
Form 471-Item 21 Attachment
PO Box 7026
Lawrence, KS 66044-7026

For courier delivery services or U.S. Postal Service Return Receipt Requested, send to:

SLD Forms
ATTN: Form 471-Item 21 Attachment
3833 Greenway Drive
Lawrence, KS 66046
Phone: (888) 203-8100

All certifications provided as a part of the FCC Form 471 also apply to the Item 21 Attachment including certifications of compliance with state and local procurement laws and compliance with Schools and Libraries Program rules. Misrepresentations on the Item 21 Attachment might result in administrative and criminal penalties described in FCC Form 471 Block 6 Certifications.

USAC reiterates that the applicant certifies as a part of the FCC Form 471 that: (1) resources to use the services effectively have been secured (FCC Form 471, Block 6, Item 25), and (2) all required documents will be retained for a period of at least five years after the last day of service delivery (FCC Form 471, Block 6, Item 32).

Additional Information

The previous examples illustrate relatively straightforward funding requests. Additional information is useful or necessary in many cases.

For example, the following information submitted without further details would not be sufficient for USAC to make a positive funding determination:

• Five routers @ $16,000 each
• Technical services for above products @ $48,000

In this example, USAC would need to request further information about the specific products (make and model) being purchased and the details of the requested technical services. USAC also may request copies of vendor quotations, a specific listing of the modules or specifications for a product, and/or copies of contracts.

Things to Remember:

• It is always important to specify the bandwidth on all Internet Access FRN’s (e.g., T-1, T-3, DS-1, etc.). 
• If any of your FRN’s include web hosting, include third party documentation that sufficiently describes the exact services that are being provided as part of the web hosting service.  
• Applicants should check the USAC website to understand the eligibility requirements for the products and services being requested.
• If any portion of your phone bill or other vendor documentation submitted with your Item 21 Attachments includes “miscellaneous charges”, please provide an explanation of what these charges are (e.g., wiring jacks, faceplates, taxes, or required fees). 
• If there are any charges on your Item 21 Attachments related to “training,” please provide a detailed explanation as to what the training involves.
• If ineligible components or features are provided that require cost allocation, the Item 21 Attachment should include appropriate details to allow efficient review.
• If you are ordering server racks or equipment cabinets, please specify the make and model of the server or equipment being housed in the racks or cabinets and the intended use of the server or equipment.
• The most complete Item 21 Attachments will indicate compliance with the conditions of eligibility. For example:
• "The Web hosting service has cost allocated xx percent to remove the ineligible content creation tools/services."
• "The memory upgrade requested will be installed in an eligible email server."
• "The multiple T-1 lines are not redundant or duplicative and are required for the bandwidth needs of the applicant."
• "The training requested consists of basic instruction in the use of eligible equipment. It is directly associated with the purchase of this equipment and is part of the same contract. No end-user training is being provided."

USAC's review process also requires further information when funding requests include the following components or configurations:

• File servers
• Amortization of up-front service provider infrastructure costs
• On-Premise Priority 1 equipment

For example, if you are requesting a PBX system or other internal connections components, please make sure to include the list of components that make up the PBX along with the appropriate make and model numbers. 

Network File Servers

The eligibility of network file servers depends on the use of the servers. Therefore, USAC will not approve funding requests for file servers unless the specific use(s) of the file servers are detailed (e.g., network, email, web, etc.) and the make and model are provided. In addition, file server costs should be allocated appropriately between eligible and any ineligible uses. 

Up-front Capital Costs

For projects that have service provider infrastructure with up-front capital costs greater than $500,000, the initial capital costs must be amortized over at least a three-year period. View an Item 21 Attachment that shows the amortization of capital costs.

The use of Schools and Libraries Program support for the build out of a service provider's infrastructure is limited. The FCC has recognized that some business arrangements between an applicant and service provider, even if labeled a lease of services, can reach essentially the same result as a prohibited WAN purchase by applicants. USAC will not commit to support on such arrangements.

On-premise Priority 1 Equipment

In limited circumstances, some types of equipment located at the applicant site can be funded as a part of an "end-to-end" telecommunications or Internet access service. Depending on the complexity of the request, the Item 21 Attachment for such funding requests may consist of two to four components:

• The listing of products and services that make up the request. This should include a specification of the components that will be located at the applicant site and a narrative overview of the funding request.
• A statement indicating whether or not there is compliance with each of the several conditions for on-premise Priority 1 equipment.
• When not otherwise clear from other information provided, a calculation that shows whether or not up-front capital charges of on-site components are less than 67 percent of total charges requested.
• For situations in which the equipment configuration is not clear from other information submitted, a network diagram may be required that shows how the components are interconnected with an applicant's internal connections components.

In cases where the above information is not provided, USAC may request further information during review of the application. View an Item 21 Attachment that specifies on-premise Priority 1 components.