FCC Record, Volume 27, No. 7, Pages 5674 to 6652, May 23 - June 15, 2012 Page: 5,685
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3. Discussion. Having reviewed the record,' we grant in part and deny in part
Birmingham's appeal of USAC's decision denying funding on the grounds that three of Birmingham's
funding requests violated the Commission's competitive bidding requirements and E-rate program rules
concerning the eligibility of services." We find that USAC improperly denied funding for some of the
services identified in FRN 755102, but properly denied requests for other services. We also find that no
competitive bidding violations occurred in the bidding process for FRN 772747. We therefore remand
those two FRNs as part of Birmingham's FY 2002 application to USAC for further consideration
consistent with this order."2 In remanding these FRNs to USAC, we make no finding as to the ultimate
eligibility of the services requested therein. For the remaining funding request, FRN 755104, we find
that Birmingham violated the Commission's competitive bidding rules and, therefore, uphold USAC's
decision on that funding request as part of Birmingham's funding year 2002 application. We consider
each FRN separately below.
4. FRN 755102. For FY 2002, Birmingham requested discounts for the following services:
Cyberpatrol License Renewal, McAfee Netshield, server maintenance, Novell Netware, installation and
relocation of equipment for eligible services, hub, and switches (i.e., installation), and repair replacement
of hub and switches (i.e., repair replacement).'3 USAC denied Birmingham's funding request for
Cyberpatrol License Renewal and McAfee Netshield because it found that these products were ineligible
for funding under E-rate program rules.14 In addition, USAC found that Birmingham's request for
support for server maintenance included charges associated with the second and third years of such
maintenance.'5 USAC thus determined that the second and third years of server maintenance were
ineligible for support because they would be delivered outside of the funding year.'6 Although USAC
removed the charges associated with years two and three of server maintenance, it denied funding for the
first year of server maintenance on the basis that more than 30 percent of the entire FRN was ineligible."7
USAC also denied funding for Novell Netware for violating its 30 percent processing benchmark.'8
Lastly, USAC found that Birmingham did not include installation and repair replacement services in its
10 47 C.F.R. 54.723 (requiring the Wireline Competition Bureau to conduct a de novo review of appeals of
decisions made by USAC).
" See 47 C.F.R. 54.504, 54.511 (2002), amended by 47 C.F.R. 54.503, 54.504, 54.511 (2011).
12 We estimate that the appeal granted in this order involves funding requests for approximately $1.9 million in
funding for FY 2002. We note that USAC has already reserved sufficient funds to address outstanding appeals.
See, e.g., Universal Service Administrative Company, Federal Universal Service Support Mechanisms Fund Size
Projections for the First Quarter 2012 (Dec. 29, 2011). We thus determine that the action we take today should have
minimal impact on the universal service fund as a whole.
' See Birmingham FCC Form 471.
14 See USAC Decision on Appeal at 2-3.
'~ See USAC Decision on Appeal at 2-3.
Federal Communications Commission
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United States. Federal Communications Commission. FCC Record, Volume 27, No. 7, Pages 5674 to 6652, May 23 - June 15, 2012, book, June 2012; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc111171/m1/28/: accessed July 22, 2017), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.