**Before the**

**Federal Communications Commission**

**Washington, DC 20554**

In the Matter of )

)

Request for Review of the )

Decision of the )

Universal Service Administrator by )

)

Henryetta Public Schools ) File No. SLD-268075

Henryetta, Oklahoma )

)

Federal-State Joint Board on ) CC Docket No. 96-45

Universal Service )

)

Changes to the Board of Directors of the ) CC Docket No. 97-21

National Exchange Carrier Association, Inc. )

**order**

**Adopted: September 19, 2002 Released: September 20, 2002**

By the Telecommunications Access Policy Division, Wireline Competition
Bureau:

1.  Before the Telecommunications Access Policy Division is a Request
    for Review filed by Henryetta Public Schools (Henryetta), Henryetta,
    Oklahoma.[^1] Henryetta requests review of a decision by the Schools
    and Libraries Division (SLD) of the Universal Service Administrative
    Company (Administrator) to deny certain Funding Year 2001 requests
    for discounts under the schools and libraries universal service
    support mechanism.[^2] For the reasons set forth below, we deny the
    Request for Review and affirm the decision of SLD.

2.  Under the schools and libraries universal service support mechanism,
    eligible schools, libraries, and consortia that include eligible
    schools and libraries, may apply for discounts for eligible
    telecommunications services, Internet access, and internal
    connections.[^3] The Commission's rules require that the applicant
    make a bona fide request for services by filing with the
    Administrator an FCC Form 470,[^4] which is posted to the
    Administrator's website for all potential competing service
    providers to review.[^5] After the FCC Form 470 is posted, the
    applicant must wait at least 28 days before entering an agreement
    for services and submitting an FCC Form 471, which requests support
    for eligible services.[^6] SLD reviews the FCC Forms 471 that it
    receives and issues funding commitment decisions in accordance with
    the Commission's rules.

3.  Given the enormous volume of applications and other submissions that
    SLD processes and reviews each year, it is necessary for SLD to put
    in place measures to ensure prompt resolution of applications. One
    such measure in place in Funding Year 2001 was an administrative
    rule that applicants from whom SLD solicits additional information
    necessary to complete their application respond with that
    information within seven days of being contacted.[^7] The processing
    standard has been necessary in order to prevent applicants from
    unduly delaying the application process.[^8]

4.  In the instant case, Henryetta appeals the denial of five of its
    Funding Year 2001 funding requests, Funding Request Numbers (FRNs)
    667429, 667386, 667413, 667422, and 690011.[^9] Except for FRN
    667429, these requests were denied on the grounds that the applicant
    had not demonstrated that it had the resources necessary to pay for
    the non-discount charges at the time it submitted its
    application.[^10]

5.  Specifically, during application review, SLD had sent Henryetta a
    letter indicating that, after looking at both of Henryetta's Funding
    Year 2001 applications (including one not before us on appeal), SLD
    had determined that Henryetta's share amounted to \$50,160.07.[^11]
    SLD requested that Henryetta provide documentation of its ability to
    pay this amount.[^12] In its response, Henryetta stated that the
    second application had been submitted with one request (for internal
    connections) that was really a duplicate of one of the requests in
    Henryetta's first application, and that the second had been
    submitted simply to correct a service provider error in the
    first.[^13] Henryetta stated that, if both were approved, the school
    would accept only one of the relevant requests, and that its share
    therefore amounted to only \$29,724.62.[^14] Henryetta therefore
    provided documentation demonstrating its ability to pay this lesser
    amount.[^15] Specifically, Henryetta indicated that it would draw
    \$3,450 from the \$348,170.21 budgetary line item for "Instruction
    -- other," and \$26,274.62 from the \$404,539.79 line item, "Op of
    Building Svc -- Other."[^16] SLD subsequently denied most of
    Henryetta's funding requests on the grounds that Henryetta "did not
    demonstrate that \[it\] had secured access to the funds necessary to
    pay the non-discount charges at the time \[it\] submitted \[its\]
    application."[^17]

6.  Following the denial of funding, Henryetta filed the pending Request
    for Review. In its Request for Review, Henryetta now asserts that it
    has the ability to pay for the entire \$50,160.07.[^18] It notes
    that the two line items cited by Henryetta in its response sum to a
    total of \$752,710, and that this is more than sufficient to pay the
    amount noted by SLD.[^19]

7.  We find that the funding requests at issue were properly denied.
    Even looking solely to the funding requests in the instant
    application, the applicant's share amounted to \$35,669.54, more
    than the \$29,724.62 that the applicant indicated it would be able
    to pay.[^20] Further, we find that Henryetta's assertion now that it
    could draw on the entire amounts of the two cited line items to
    support its requests must be rejected as an invalid attempt to
    introduce new evidence. We do not permit new evidence on an issue
    where SLD has already provided an applicant with opportunity to
    present such evidence.[^21] Here, in SLD's documentation request, it
    specifically indicated that Henryetta indicate "the specific amount
    that will come from each . . . budget line."[^22] Henryetta
    indicated that a total of \$29,724.62 would come from these
    items.[^23] Looking solely to this record, we find that Henryetta
    did not demonstrate that it had sufficient resources to pay for its
    share of service costs.

8.  Because our affirmation of SLD's decision supports the denial of the
    internal connections request as well as the other requests, we need
    not discuss that request any further. In addition, we note that,
    although we have not relied on the service cost at issue in the
    second application, we find that Henryetta would be responsible for
    demonstrating an ability to pay its share of this cost,
    notwithstanding its assertion that it would not attempt to collect
    on the service request. If SLD were to ignore the resources
    necessary for a pending request simply because of an assurance from
    an applicant that the request, if granted, would not be utilized,
    the risk of fraud, waste and abuse would be tremendously increased.
    Further, the filing of a second full application would clearly be an
    improper method of seeking a change of service provider, because it
    is contrary to the express instructions of SLD on how to make such
    changes, and because it needlessly places on SLD the full burden and
    administrative expense of processing and reviewing an entire
    application.[^24]

9.  ACCORDINGLY, IT IS ORDERED, pursuant to authority delegated under
    sections 0.91, 0.291, and 54.722(a) of the Commission's rules, 47
    C.F.R. §§ 0.91, 0.291, and 54.722(a), that the Request for Review
    filed by Henryetta Public Schools, Henryetta, Oklahoma, on February
    25, 2002 IS DENIED.

    FEDERAL COMMUNICATIONS COMMISSION

    Mark G. Seifert

    Deputy Chief, Telecommunications Access Policy Division

    Wireless Competition Bureau

[^1]: Letter from Dan Edwards, Henryetta Public Schools, to Federal
    Communications Commission, filed February 25, 2002 (Request for
    Review).

[^2]: *See* Request for Review. Section 54.719(c) of the Commission's
    rules provides that any person aggrieved by an action taken by a
    division of the Administrator may seek review from the Commission.
    47 C.F.R. § 54.719(c). In prior years, Funding Year 2001 was
    referred to as Funding Year 4. Funding periods are now described by
    the year in which the funding period starts. Thus the funding period
    that began on July 1, 1999 and ended on June 30, 2000, previously
    known as Funding Year 2, is now called Funding Year 1999. The
    funding period that began on July 1, 2000 and ended on June 30, 2001
    is now known as Funding Year 2000, and so on.

[^3]: 47 C.F.R. §§ 54.502, 54.503.

[^4]: Schools and Libraries Universal Service, Description of Services
    Requested and Certification Form, OMB 3060-0806 (September 1999)
    (FCC Form 470).

[^5]: 47 C.F.R. § 54.504(b); *Federal-State Joint Board on Universal
    Service*, CC Docket No. 96-45, Report and Order, 12 FCC Rcd 8776,
    9078, para. 575 (1997) (*Universal Service Order*), as corrected by
    *Federal‑State Joint Board on Universal Service*, CC Docket No.
    96‑45, Errata, FCC 97‑157 (rel. June 4, 1997), *affirmed in part*,
    *Texas Office of Public Utility Counsel v. FCC*, 183 F.3d 393 (5th
    Cir. 1999) (affirming *Universal Service First Report and Order* in
    part and reversing and remanding on unrelated grounds), *cert.
    denied, Celpage, Inc. v. FCC*, 120 S. Ct. 2212 (May 30, 2000),
    *cert. denied,* *AT&T Corp. v. Cincinnati Bell Tel. Co*., 120 S. Ct.
    2237 (June 5, 2000*), cert. dismissed,* *GTE Service Corp. v. FCC*,
    121 S. Ct. 423 (November 2, 2000).

[^6]: 47 C.F.R. § 54.504(b), (c); Schools and Libraries Universal
    Service, Services Ordered and Certification Form, OMB 3060-0806
    (October 2000) (FCC Form 471).

[^7]: *See Request for Review by Nefesh Academy, Federal-State Joint
    Board on Universal Service, Changes to the Board of Directors of the
    National Exchange Carrier Association, Inc.*, File No. SLD-27881, CC
    Dockets No. 96-45 and 97-21, Order, DA 99-2284 (Com. Car. Bur. rel.
    October 22, 1999) (citing seven-day rule).

[^8]: *Request for Review by Seventh Day Adventist School, Federal-State
    Joint Board on Universal Service, Changes to the Board of Directors
    of the National Exchange Carrier Association, Inc.*, File No.
    SLD-193882, CC Dockets No. 96-45 and 97-21, Order, 17 FCC Rcd 658,
    para. 8 (Com. Car. Bur. 2002).

[^9]: *See* Request for Review, at 1; FCC Form 471, Henryetta Public
    Schools, filed January 16, 2001 (Henryetta Form 471).

[^10]: Letter from Schools and Libraries Division, Universal Service
    Administrative Company, to Kaye Goodner, Henryetta Public Schools,
    dated January 25, 2002 (Funding Commitment Decision Letter), at 6-7.
    FRN 667429 was denied on the grounds that it sought internal
    connections and Henryetta did not have a sufficient discount rate to
    be eligible for internal connections discounts. *Id.* at 7.

[^11]: Facsimile from Schools and Libraries Division, Universal Service
    Administrative Company, to Kaye Goodner, Henryetta Public Schools,
    dated June 12, 2001 (Documentation Request), at 1.

[^12]: *Id.* at 2.

[^13]: Letter from Kaye Goodner, Henryetta Public Schools, to Schools
    and Libraries Division, Universal Service Administrative Company,
    filed June 26, 2001 (Response to Documentation Request), at 1.

[^14]: *Id.*

[^15]: *Id.*, Attachment (Preliminary Budget).

[^16]: *Id.*, Attachment (Verification Letter).

[^17]: Letter from Schools and Libraries Division, Universal Service
    Administrative Company, to Kaye Goodner, Henryetta Public Schools,
    dated January 25, 2002, at 6-7. Funding requests for basic voice
    telecommunications were funded pursuant to the Commission's holding
    in *Request for Review by United Talmudical Academy, Federal-State
    Board on Universal Service, Changes to the Board of Directors of the
    National Exchange Carrier Association, Inc.*, File No. SLD-105791,
    CC Dockets No. 96-45 and 97-21, 15 FCC Rcd 423 (2000).

[^18]: Request for Review.

[^19]: *Id.*

[^20]: *See* Henryetta Form 471.

[^21]: *Request for Review by Southwest Virginia Education and Training
    Network, Federal-State Joint Board on Universal Service, Changes to
    the Board of Directors of the National Exchange Carrier Association,
    Inc.*, File No. SLD-200540, CC Dockets No. 96-45 and 97-21, Order,
    DA 02-1207, n.19 (Wireline Comp. Bur. May 21, 2002).

[^22]: Documentation Request.

[^23]: Verification Letter.

[^24]: *See* SLD website,
    \<<http://www.sl.universalservice.org/reference/SpinChangeYr4.asp>\>
    (providing directions for obtaining service provider changes,
    referred to as SPIN changes).