**Before the**

**Federal Communications Commission**

**Washington, DC 20554**

In the Matter of )

)

Requests for Waiver )

of the Decision of the )

Universal Service Administrator by )

)

Adams County School District 14 ) File Nos. SLD-425151, 425211, 425303,
Commerce City, Colorado, *et al.* ) 425352, 426285, *et al.*

)

Schools and Libraries Universal Service ) CC Docket No. 02-6

Support Mechanism )

**order**

**Adopted: March 22, 2007 Released: March 28, 2007**

By the Commission: Commissioner McDowell issuing a statement.

**I. INTRODUCTION**

1.  In this Order, we grant requests by 66 schools and libraries
    (collectively, Petitioners) for review of decisions by the Universal
    Service Administrative Company (USAC) denying applications for
    discounted services under the schools and libraries universal
    service mechanism (also known as the E-rate program) on the grounds
    that they violated the Commission's requirement that a legally
    binding agreement be in place when the FCC Form 471 application is
    submitted.[^1] We also grant six appeals from applicants whose
    funding commitments were reduced on the grounds that an existing
    contract expired without the applicant posting a new FCC Form 470
    for services to be provided for the remainder of the funding
    year.[^2] To ensure that the underlying applications are resolved
    expeditiously, we direct USAC to complete its review of each
    application listed in Appendices A and B and issue an award or
    denial based upon a complete review and analysis no later than 90
    days from the release of this Order.

## II. BACKGROUND

2.  Under the E-rate program, 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] Our rules provide that, with one limited
    exception for existing, binding contracts, an eligible school,
    library, or consortium that includes eligible schools or libraries
    must seek competitive bids for all services eligible for
    support.[^4] In accordance with our rules, an applicant must file
    with USAC an FCC Form 470 requesting services.[^5] After the FCC
    Form 470 is posted to USAC's web site, the applicant must wait 28
    days before entering into an agreement with a service provider for
    the requested services and submitting an FCC Form 471.[^6] Section
    54.504(c) of our rules also states that the FCC Form 471 requesting
    support for the services ordered by the applicant shall be submitted
    "upon signing a contract for eligible services."[^7] Specifically,
    the instructions for FCC Form 471 state that applicants must have a
    "signed contract" or a "legally binding agreement" with the service
    provider "for all services" ordered on the FCC Form 471.[^8]

3.  There are two exceptions to this rule: non-contracted tariffed
    services and certain month-to-month services.[^9] If the services
    are month-to-month, applicants can instead submit copies of standard
    monthly bills as proof that they have binding, legal arrangements
    with service providers.[^10] In addition, applicants are instructed
    to indicate that such situations exist by filling in the
    abbreviation "MTM" in Item 15 of the FCC Form 471.[^11]

4.  To ensure that applicants are in compliance with our competitive
    bidding rules, applicants must file a new FCC Form 470 when the
    existing contract ends.[^12] When contracts expire at the end of the
    original term, the applicant must post a new FCC Form 470 for
    services provided beyond the contract expiration date.[^13] An
    applicant does not need to post a new FCC Form 470 each year when it
    has a multi-year contract or when exercising a contract's voluntary
    renewal provision if the applicant indicated that it was seeking a
    contract with those terms when it originally filed the FCC Form
    470.[^14]

5.  Seventy-two Petitioners have requested a waiver of our rules or a
    review of USAC's decision to deny funding because they did not have
    a legally binding agreement in place when their FCC Form 471
    application was submitted or because their contract expired before
    the end of the funding year.[^15]

## III. DISCUSSION

6.  In this item, we grant relief to 72 Petitioners seeking a reversal
    of USAC's decisions to deny their requests for universal service
    funding under the E-rate program. We grant a limited waiver of
    section 54.504(c) of our rules and remand the underlying
    applications associated with these appeals to USAC for further
    action consistent with this Order.[^16] To ensure that the
    underlying applications are resolved expeditiously, we direct USAC
    to complete its review of each application listed in Appendices A
    and B and issue an award or denial based upon a complete review and
    analysis no later than 90 days from the release of this Order.

7.  Petitioners' requests for universal service funding were denied
    either because they did not have a legally binding agreement in
    place when their FCC Form 471 application was submitted or because
    their contract expired before the end of the funding year. Some
    Petitioners claim that they could not or did not comply with our
    rules due to conflicting local or state procurement
    requirements.[^17] Other Petitioners claim that their employees
    erred or they misunderstood the rules.[^18] Other Petitioners claim
    that they technically followed program rules despite USAC's decision
    to the contrary.[^19]

8.  Based on the facts and the circumstances of these specific cases, we
    find that good cause exists to grant a limited waiver of section
    54.504(c) of our rules for these Petitioners.[^20] Competitive
    bidding requirements serve as a central tenet of the E-rate program.
    They ensure more efficient pricing for telecommunications and
    information services purchased by schools and libraries and help
    deter waste, fraud and abuse. Rigid adherence to the rule in these
    cases, however, does not further the purposes of the statutory goal
    mandated by Congress of preserving and advancing universal service
    for schools and libraries. Furthermore, we note granting these
    appeals should have minimal effect on the Universal Service Fund
    (USF or the Fund).[^21]

9.  The record demonstrates that although some Petitioners technically
    missed the program deadline for having a written contract in place,
    they were adhering to local or state procurement laws.[^22] Others
    had to have their commitments with service providers approved by
    their governing boards or their agreements with service providers
    were contingent upon getting USAC's approval of funding before they
    could legally enter into the contract.[^23] As a result, these
    Petitioners were unable to sign a legally binding agreement prior to
    filing their FCC Form 471 as required by section 54.504(c) of our
    rules.[^24] Other Petitioners were denied needed funding because of
    ministerial mistakes.[^25] For example, Academia Cristo de los
    Milagros mistakenly noted on its FCC Form 471 that its contract
    ended nine months before the end of the funding year, thus securing
    funding for only three months instead of the 12 it intended.[^26] In
    another appeal, Compton Unified School District said it submitted
    the wrong contract to USAC, making it appear as though its FCC Form
    471 was submitted before its contract was signed.[^27] Although the
    Petitioners missed the deadline for evidencing a signed contract,
    they had legally binding contracts in place during the relevant
    funding years. Thus, all Petitioners had some form of an agreement
    with their service providers before submitting their FCC Forms 471.
    We find, therefore, that in these specific circumstances, a limited
    waiver of rule 54.504(c) is warranted.

10. These mistakes do not warrant the complete rejection of these
    Petitioners' applications for E-rate funding. Importantly, these
    appeals do not involve a misuse of funds. The Commission recently
    found in *Bishop Perry Middle School* that, under certain
    circumstances, rigid adherence to certain E-rate rules and
    requirements that are "procedural" in nature does not promote the
    goals of section 254 of the Act -- ensuring access to discounted
    telecommunications and information services to schools and libraries
    -- and therefore does not serve the public interest.[^28]

11. Consistent with precedent, we also grant the requests for review in
    instances where USAC denied funding solely because the execution
    date of the contract did not accompany the signature lines of both
    the applicant and the service provider.[^29] We find in these
    instances that the Petitioners were denied funding by USAC only
    because the effective date of the contract was separate from the
    signature lines but that Petitioners had signed and dated contracts
    in place before the submission of their FCC Forms 471 and thus were
    in compliance with our rules.[^30]

12. In all of these cases, there is no evidence in the record that
    Petitioners engaged in activity to defraud or abuse the E-rate
    program. Finally, we find that, for these applicants, denying their
    requests for funding would create undue hardship and prevent these
    otherwise eligible schools and libraries from receiving E-rate
    funding. In some instances here we depart from prior Bureau
    precedent.[^31] For the reasons we describe, however, we find that
    the departure is warranted and in the public interest. Accordingly,
    we find that good cause exists to grant Petitioners a limited waiver
    of our rules, and remand these matters to USAC for further
    processing consistent with our decision.[^32]

13. To assist applicants in successfully applying for funding, we direct
    USAC to increase its outreach and educational efforts to inform
    applicants about the program's application requirements in an
    attempt to reduce these types of errors. We expect that the
    additional outreach and educational efforts will better assist
    E-rate applicants in meeting the program's requirements and increase
    awareness of the filing rules and procedures. As we noted above, we
    believe that these changes will improve the overall efficiency of
    the E-rate program and reduce the occurrence of circumstances
    justifying waivers such as those granted above.

14. We emphasize the limited nature of this decision. As stated above,
    our competitive bidding rules are important to ensure more efficient
    pricing for telecommunications and information services purchased by
    schools and libraries. Although we grant the subject appeals before
    us, our action here does not eliminate the rule that applicants have
    a signed contract in place when submitting an FCC Form 471. In
    addition, we continue to require E-rate applicants to submit
    complete and accurate contract information to USAC in a timely
    fashion as part of the application review process.

15. Finally, we are committed to guarding against waste, fraud, and
    abuse, and ensuring that funds disbursed through the E-rate program
    are used for appropriate purposes. Although we grant the appeals
    addressed here, this action in no way affects the authority of the
    Commission or USAC to conduct audits and investigations to determine
    compliance with the E-rate program rules and requirements. Because
    audits or investigations may provide information showing that a
    beneficiary or service provider failed to comply with the statute or
    Commission rules, such proceedings can reveal instances in which
    universal service funds were improperly disbursed or in a manner
    inconsistent with the statute or our rules. To the extent we find
    that funds were not used properly, we will require USAC to recover
    such funds through its normal processes. We emphasize that we retain
    the discretion to evaluate the uses of monies disbursed through the
    E-rate program and to determine on a case-by-case basis that waste,
    fraud, or abuse of program funds occurred and that recovery is
    warranted. We remain committed to ensuring the integrity of the
    program and will continue to aggressively pursue instances of waste,
    fraud, or abuse under our procedures and in cooperation with law
    enforcement agencies.

## IV. ORDERING CLAUSES

16. ACCORDINGLY, IT IS ORDERED that, pursuant to the authority contained
    in sections 1-4 and 254 of the Communications Act of 1934, as
    amended, 47 U.S.C. §§ 151-154 and 254, and section 1.3 of the
    Commission's rules, 47 C.F.R. § 1.3, that the Requests for Review
    and Requests for Waiver filed by the Petitioners as listed in
    Appendices A and B ARE GRANTED and REMANDED to USAC for further
    consideration in accordance with the terms of this Order.

17. IT IS FURTHER ORDERED that, pursuant to the authority contained in
    sections 1-4 and 254 of the Communications Act of 1934, as amended,
    47 U.S.C. §§ 151-154 and 254, and section 1.3 of the Commission's
    rules, 47 C.F.R. § 1.3, that section 54.504(c) of the Commission's
    rules, 47 C.F.R. § 54.504(c), IS WAIVED to the limited extent
    described herein.

18. IT IS FURTHER ORDERED that, pursuant to the authority contained in
    sections 1-4 and 254 of the Communications Act of 1934, as amended,
    47 U.S.C. §§ 151-154 and 254, USAC SHALL COMPLETE its review of each
    remanded application listed in Appendices A and B and ISSUE an award
    or a denial based on a complete review and analysis no later than 90
    calendar days from release of this Order.

19. IT IS FURTHER ORDERED that this Order SHALL BE EFFECTIVE upon
    release, in accordance with section 1.103 of the Commission\'s
    rules, 47 C.F.R. § 1.103.

    FEDERAL COMMUNICATIONS COMMISSION

    Marlene H. Dortch

    Secretary

**Appendix A**

**No Contract in Place When Application Filed**

+------------------------+-----------------+-------+------------------+
| **Applicant**          | > **Application | *     | **Type of        |
|                        | > Number**      | *Fund | Appeal**         |
|                        |                 | ing** |                  |
|                        |                 |       |                  |
|                        |                 | **Y   |                  |
|                        |                 | ear** |                  |
+------------------------+-----------------+-------+------------------+
| Adams County School    | 425151, 425211, | 2004  | Request for      |
| District 14            | 425303, 425352, |       | Review           |
|                        |                 |       |                  |
| Commerce City, CO      | 426285          |       |                  |
+------------------------+-----------------+-------+------------------+
| Aldar Academy          | 444345          | 2005  | Request for      |
|                        |                 |       | Review           |
| Sacramento, CA         |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Amesbury School        | 524312          | 2006  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Amesbury, MA           |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Andes Central School   | 465233          | 2005  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Lake Andes, SD         |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Audre & Bernard        | 504341          | 2006  | Request for      |
| Rapoport Academy       |                 |       | Review           |
|                        |                 |       |                  |
| Waco, TX               |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Ballard County School  | 368830          | 2003  | Request for      |
| District\              |                 |       | Waiver           |
| Barlow, KY             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Beacon Academy         | > 477882        | 2005  | Request for      |
|                        |                 |       | Review           |
| Plymouth, MN           |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Bertie County School   | 400171          | 2004  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Windsor, NC            |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Bourne Middle School   | 388259          | 2004  | Request for      |
|                        |                 |       | Review           |
| Bourne, MA             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Bullock County School  | 470756          | 2005  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Union Springs, AL      |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Campbell City Schools  | 503601, 503656, | 2006  | Request for      |
|                        | 503719, 503766, |       | Review           |
| Campbell, OH           | 505058, 505093, |       |                  |
|                        | 505132, 505158, |       |                  |
|                        | 507528, 507546, |       |                  |
|                        | 507560, 507569, |       |                  |
|                        | 507582, 513045  |       |                  |
+------------------------+-----------------+-------+------------------+
| Chesapeake Public      | 409639, 414295  | 2004  | Request for      |
| Library System         |                 |       | Review           |
|                        |                 |       |                  |
| Chesapeake, VA         |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Churchill County       | 461600          | 2005  | Request for      |
| School District        |                 |       | Review           |
|                        |                 |       |                  |
| Fallon, NV             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Christian Academy of   | 468814          | 2005  | Request for      |
| Indiana                |                 |       | Review           |
|                        |                 |       |                  |
| New Albany, IN         |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| City of Baker School   | 483704          | 2005  | Request for      |
| System                 |                 |       | Review           |
|                        |                 |       |                  |
| Baker, LA              |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Compton Unified School | 378434, 378426, | 2003  | Request for      |
| District               |                 |       | Review           |
|                        | 378414          |       |                  |
| Compton, CA            |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Cristo Rey New York    | 468832          | 2005  | Request for      |
| High School            |                 |       | Review and/or    |
|                        |                 |       | Waiver           |
| New York, NY           |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Des Moines Public      | 341871          | 2003  | Request for      |
| Schools                |                 |       | Review           |
|                        |                 |       |                  |
| Des Moines, IA         |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| District of Columbia   | 379940          | 2003  | Request for      |
| Public Schools         |                 |       | Review           |
|                        |                 |       |                  |
| Washington, DC         |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Duluth Public Schools  | 396882          | 2004  | Request for      |
|                        |                 |       | Review           |
| Duluth, MN             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Eagle Ridge Academy    | 458813          | 2005  | Request for      |
|                        |                 |       | Review           |
| Eden Prairie, MN       |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| FCMA Immokalee Charter | 466246          | 2005  | Request for      |
| School                 |                 |       | Review           |
|                        |                 |       |                  |
| Immokalee, FL          |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Fox Public Schools     | 467699          | 2005  | Request for      |
|                        |                 |       | Review           |
| Fox, OK                |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Fulton County School   | 423688          | 2004  | Request for      |
| District               |                 |       | Waiver           |
|                        |                 |       |                  |
| Atlanta, GA            |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Greater Newark Charter | 509633          | 2006  | Request for      |
| School                 |                 |       | Review           |
|                        |                 |       |                  |
| Newark, NJ             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Hmong Academy          | 467565          | 2005  | Request for      |
|                        |                 |       | Review           |
| Minneapolis, MN        |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Holy Family School\    | 484690          | 2005  | Request for      |
| Sauk Centre, MN        |                 |       | Review           |
+------------------------+-----------------+-------+------------------+
| Information Referral   | 249067          | 2001  | Request for      |
| Resource Assistance    |                 |       | Review           |
| Independent School     |                 |       |                  |
| District               |                 |       |                  |
|                        |                 |       |                  |
| McAllen, TX            |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Institute for Learning | 481216          | 2005  | Request for      |
| Research, Inc.         |                 |       | Review           |
|                        |                 |       |                  |
| Nashville, TN          |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Jefferson Parish       | 343040          | 2003  | Request for      |
| School District\       |                 |       | Review           |
| Marreo, LA             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Kershaw County School  | > 466530        | 2005  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Camden. SC             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Kingman Unified School | > 479031        | 2005  | Request for      |
| District No. 20        |                 |       | Review           |
|                        |                 |       |                  |
| Kingman, AZ            |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Lapeer District        | > 521373        | 2006  | Request for      |
| Library                |                 |       | Review           |
|                        |                 |       |                  |
| Lapeer, MI             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Laredo Independent     | 454650          | 2005  | Request for      |
| School District        |                 |       | Review           |
|                        |                 |       |                  |
| Laredo, TX             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Leland School          | 367641          | 2003  | Request for      |
| District\              |                 |       | Review           |
| Leland, MS             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Lexington County       | 453019          | 2005  | Request for      |
| School District 2      |                 |       | Review           |
|                        |                 |       |                  |
| West Columbia, SC      |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Lowell Joint           | 445846          | 2005  | Request for      |
| Elementary School      |                 |       | Review and/or    |
| District               |                 |       | Waiver           |
|                        |                 |       |                  |
| Whittier, CA           |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Madison-Oneida BOCES   | 401042          | 2004  | Request for      |
|                        |                 |       | Review           |
| Verona, NY             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Mercedes Independent   | 471135          | 2005  | Request for      |
| School District        |                 |       | Review           |
|                        |                 |       |                  |
| Mercedes, TX           |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Miami-Dade County      |   ------------  | 2003  | Request for      |
| Public Schools         |   354565,       |       | Review           |
|                        |   354571        |       |                  |
| Miami, FL              |                 |       |                  |
|                        |   354737,       |       |                  |
|                        |   354745        |       |                  |
|                        |                 |       |                  |
|                        |   354754,       |       |                  |
|                        |   354768        |       |                  |
|                        |                 |       |                  |
|                        |   354777,       |       |                  |
|                        |   354780        |       |                  |
|                        |                 |       |                  |
|                        |   354784,       |       |                  |
|                        |   354785        |       |                  |
|                        |                 |       |                  |
|                        |   354825,       |       |                  |
|                        |   354839        |       |                  |
|                        |                 |       |                  |
|                        |   355506,       |       |                  |
|                        |   355521        |       |                  |
|                        |                 |       |                  |
|                        |   355546,       |       |                  |
|                        |   355587        |       |                  |
|                        |                 |       |                  |
|                        |   355620,       |       |                  |
|                        |   355627        |       |                  |
|                        |                 |       |                  |
|                        |   355632,       |       |                  |
|                        |   355900        |       |                  |
|                        |                 |       |                  |
|                        |   356339,       |       |                  |
|                        |   356354        |       |                  |
|                        |                 |       |                  |
|                        |   356410,       |       |                  |
|                        |   356483        |       |                  |
|                        |                 |       |                  |
|                        |   356520,       |       |                  |
|                        |   356525        |       |                  |
|                        |                 |       |                  |
|                        |   356527,       |       |                  |
|                        |   356868        |       |                  |
|                        |                 |       |                  |
|                        |   356907        |       |                  |
|                        |   ------------  |       |                  |
+------------------------+-----------------+-------+------------------+
| Monroe County Library  | 406926          | 2004  | Request for      |
| System\                |                 |       | Review           |
| Rochester, NY          |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Montgomery County      | 532303          | 2006  | Request for      |
| School                 |                 |       | Review           |
|                        |                 |       |                  |
| District               |                 |       |                  |
|                        |                 |       |                  |
| Mount Vernon, GA       |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Milwaukee Public       |   ------------  | 2003  | Request for      |
| Schools                |   354623,       |       | Review           |
|                        |   354664,       |       |                  |
| Milwaukee, WI          |                 |       |                  |
|                        |   355875,       |       |                  |
|                        |   355930,       |       |                  |
|                        |                 |       |                  |
|                        |   355983,       |       |                  |
|                        |   356089,       |       |                  |
|                        |                 |       |                  |
|                        |   356103,       |       |                  |
|                        |   356131,       |       |                  |
|                        |                 |       |                  |
|                        |   356135,       |       |                  |
|                        |   356146,       |       |                  |
|                        |                 |       |                  |
|                        |   356151,       |       |                  |
|                        |   356155,       |       |                  |
|                        |                 |       |                  |
|                        |   356157,       |       |                  |
|                        |   356161,       |       |                  |
|                        |                 |       |                  |
|                        |   356413,       |       |                  |
|                        |   356424,       |       |                  |
|                        |                 |       |                  |
|                        |   356436,       |       |                  |
|                        |   356466,       |       |                  |
|                        |                 |       |                  |
|                        |   356482,       |       |                  |
|                        |   356508,       |       |                  |
|                        |                 |       |                  |
|                        |   356526,       |       |                  |
|                        |   359965,       |       |                  |
|                        |                 |       |                  |
|                        |   360288,       |       |                  |
|                        |   360321,       |       |                  |
|                        |                 |       |                  |
|                        |   360352,       |       |                  |
|                        |   361703,       |       |                  |
|                        |   362581,       |       |                  |
|                        |   380783,       |       |                  |
|                        |                 |       |                  |
|                        |   381644        |       |                  |
|                        |   ------------  |       |                  |
+------------------------+-----------------+-------+------------------+
| Missouri Research and  | > 345858        | 2003  | Request for      |
| Education Network      |                 |       | Review           |
|                        |                 |       |                  |
| Columbia, MO           |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Nicholas County School | 417459          | 2004  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Summersville, WV       |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Our Lady Queen of      | 511519          | 2006  | Request for      |
| Martyrs School         |                 |       | Review           |
|                        |                 |       |                  |
| New York, NY           |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Parma City School      | > 534544        | 2006  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Parma, OH              |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| RCMA Mimauma Charter   | 467631          | 2005  | Request for      |
| School                 |                 |       | Review           |
|                        |                 |       |                  |
| Mimauma, FL            |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Richmond County School | 464724          | 2005  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Hamlet, NC             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Russell County Public  | 459434          | 2005  | Request for      |
| Schools                |                 |       | Waiver           |
|                        |                 |       |                  |
| Lebanon, VA            |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Saddle Mountain        | 476327          | 2005  | Request for      |
| Unified School         |                 |       | Review           |
| District \# 90         |                 |       |                  |
|                        |                 |       |                  |
| Tonopah, AZ            |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Saint Louis Special    | 413815          | 2004  | Request for      |
| School District        |                 |       | Review           |
|                        |                 |       |                  |
| Saint Louis, MI        |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Saint Paul Public      | 413491, 415327, | 2004  | Request for      |
| Schools\               | 413528, 413567  |       | Review           |
| Saint Paul, MN         |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Salisbury---Elk Lick   | 459065          | 2005  | Request for      |
| School District        |                 |       | Review           |
|                        |                 |       |                  |
| Salisbury, PA          |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Sanborn Regional       | 449743          | 2005  | Request for      |
| School District        |                 |       | Review           |
|                        |                 |       |                  |
| Kingston, NH           |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| San Diego Independent  | 252293          | 2001  | Request for      |
| School District        |                 |       | Review           |
|                        |                 |       |                  |
| San Diego, TX          |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Southside Independent  | > 464380        | 2005  | Request for      |
| School District        |                 |       | Review           |
|                        |                 |       |                  |
| San Antonio, TX        |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| St. Ignatius School    | 429540, 429830  | 2004  | Request for      |
|                        |                 |       | Review           |
| Bronx, NY              |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| St. Leo Catholic Urban | 311690          | 2002  | Request for      |
| Academy                |                 |       | Review           |
|                        |                 |       |                  |
| Milwaukee, WI          |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| St. Matthias School    | 336830          | 2003  | Request for      |
|                        |                 |       | Review           |
| Ridgewood, NY          |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| St. Rose Catholic      | 311781          | 2002  | Request for      |
| Urban Academy          |                 |       | Review           |
|                        |                 |       |                  |
| Milwaukee, WI          |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Sunnyside Unified      | 451167          | 2005  | Request for      |
| School District 12     |                 |       | Review           |
|                        |                 |       |                  |
| Tucson, AZ 85706       |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| United Talmudical      | 483460          | 2005  | Request for      |
| Academy                |                 |       | Review           |
|                        |                 |       |                  |
| Brooklyn, NY           |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Upshur County School   | 353074          | 2003  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Buckhannon, WV         |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Weatherly Area School  | > 532197        | 2006  | Request for      |
| District               |                 |       | Review           |
|                        |                 |       |                  |
| Weatherly, PA          |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Wood County            | 463990          | 2005  | Request for      |
| Educational Service    |                 |       | Review           |
| Center                 |                 |       |                  |
|                        |                 |       |                  |
| Bowling Green, OH      |                 |       |                  |
+------------------------+-----------------+-------+------------------+

**Appendix B**

**Contract Expired Before End of Funding Year**

+------------------------+-----------------+-------+------------------+
| **Applicant**          | **Application   | **Fu  | **Type of        |
|                        | Number**        | nding | Appeal**         |
|                        |                 | Y     |                  |
|                        |                 | ear** |                  |
+------------------------+-----------------+-------+------------------+
| Academia Cristo de los | 404845          | 2004  | Request for      |
| Milagros               |                 |       | Review           |
|                        |                 |       |                  |
| Caguas, PR             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Guam Department of     | 412174          | 2004  | Request for      |
| Education              |                 |       | Review           |
|                        |                 |       |                  |
| Agana, GU              |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Lincolnville Central   | 289286          | 2002  | Request for      |
| School                 |                 |       | Review           |
|                        |                 |       |                  |
| Lincolnville, ME       |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Merrimack Valley       | 391277          | 2004  | Request for      |
| Library Consortium     |                 |       | Review           |
|                        |                 |       |                  |
| Andover, MA            |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| Metropolitan Dayton    | 389346          | 2004  | Request for      |
| Educational            |                 |       | Review           |
| Cooperative            |                 |       |                  |
| Association            |                 |       |                  |
|                        |                 |       |                  |
| Dayton, OH             |                 |       |                  |
+------------------------+-----------------+-------+------------------+
| North Clackamas School | > 510137        | 2006  | Request for      |
| District 12            |                 |       | Review           |
|                        |                 |       |                  |
| Milwaukie, OR          |                 |       |                  |
+------------------------+-----------------+-------+------------------+

**STATEMENT**

**COMMISSIONER ROBERT M. McDOWELL**

*Re: Requests for Waiver of the Decision of the Universal Service
Administrator by*

*Adams County School District 14, Commerce City, CO, et al., and*

*Schools and Libraries Universal Service Support Mechanism, CC Docket
No. 02-6*

*Re: Requests for Review of the Decision of the Universal Service
Administrator by*

*Alpaugh Unified School District, Alpaugh, CA, et al., and*

*Schools and Libraries Universal Service Support Mechanism, CC Docket
No. 02-6*

> *Re: Requests for Review or Waiver of the Decision of the*
>
> *Universal Service Administrator by*

*Brownsville Independent School District, Brownsville, TX, et al., and*

*Schools and Libraries Universal Service Support Mechanism, CC Docket
No. 02-6*

By adopting these three orders, we are granting 182 appeals of decisions
taken by the Universal Service Administrative Company (USAC) that
reduced or denied funding by applicants of the schools and libraries
universal service mechanism. This program promotes the noble goal of
assisting schools and libraries in the United States to obtain
affordable telecommunications and Internet access. I support these
decisions for several reasons. First, each of these appeals involves
technicalities in the USAC procedures. Our actions here do not
substantively alter the eligibility of the Schools and Libraries
program. Furthermore, we find no indication of any intention to defraud
the system on the part of any of these applicants. Also, our decisions
and USAC's actions on appeal should have minimal effect on the level of
the Universal Service Fund, because USAC has already reserved sufficient
funds to take into account pending appeals. Finally, I am pleased that
we impose reasonable time limits on USAC to address these cases on
appeal so they can be resolved expeditiously.

[^1]: *See* Appendix A. In this Order, we use the term "appeals" to
    refer generically to requests for review of decisions, or to
    petitions for waivers related to such decisions, issued by the
    Commission, the Wireline Competition Bureau, or USAC. A list of
    these filings is attached in the Appendices and we will refer to all
    of these parties as Petitioners. Section 54.719(c) of the
    Commission's rules provides that any person aggrieved by an action
    taken by a division of the Universal Service Administrative Company
    may seek review from the Commission. 47 C.F.R. § 54.719(c).

[^2]: *See* Appendix B.

[^3]: 47 C.F.R. §§ 54.502, 54.503.

[^4]: 47 C.F.R. §§ 54.504, 54.511(c).

[^5]: 47 C.F.R. § 54.504(b); s*ee* *also* Schools and Libraries
    Universal Service, Description of Services Requested and
    Certification Form, OMB 3060-0806 (September 1999) (FCC Form 470).

[^6]: 47 C.F.R. § 54.504(b)(4); s*ee* *also* Schools and Libraries
    Universal Service, Services Ordered and Certification Form, OMB
    3060-0806 (September 1999) (FCC Form 471).

[^7]: 47 C.F.R. § 54.504(c); s*ee also Request for Review of Waldwick
    School District, Schools and Libraries Universal Service Support
    Mechanisms*, File No. SLD-234540, CC Docket No. 02-6, Order, 18 FCC
    Rcd 22994, 22995, para. 3 (Wireline Comp. Bur. 2003) (*Waldwick
    Order*); *Request for Review of St. Joseph High School, Schools and
    Libraries Universal Service Support Mechanisms*, File No.
    SLD-234540, CC Docket Nos. 96-45, 97-21, Order, 17 FCC Rcd 22499,
    22500-01, para. 4 (Wireline Comp. Bur. 2002) (*St. Joseph Order*).

[^8]: Instructions for Completing the Schools and Libraries Universal
    Service, Services Ordered and Certification Form, OMB 3060-0806
    (November 2001) (FCC Form 471 Instructions) at 19.

[^9]: *Id.* Applicants taking services from a filed tariff are not
    required to have a binding contract because the service is provided
    by the service provider to all parties at set rates and conditions.

[^10]: *Id.* at 20.

[^11]: *Id.*

[^12]: *See Request for Review of New Albany-Floyd County Consolidated
    School Corporation, Schools and Libraries Universal Service Support
    Mechanisms*, File No. SLD-287615, CC Docket No. 02-6, Order, 20 FCC
    Rcd 8159, 8160-61, para. 5 (Wireline Comp. Bur. 2005) (*New
    Albany-Floyd County Order*).

[^13]: *Id*. *See also* USAC website, Contract Guidance,
    \<[http://www.sl.universalservice.org/reference/contract%5Fguidance.asp]{.underline}\>
    (retrieved Feb. 14, 2007).

[^14]: *Id*.

[^15]: *See* 47 C.F.R. § 54.504(c). Although there is no specific
    provision in the Commission's rules that requires applicants to file
    a new Form 470 for services that extend beyond the contract
    expiration date, this principle is implicit in the program
    requirement that all services funded by the schools and libraries
    program be competitively bid. *See* 47 C.F.R. 54.504(a).

[^16]: The Commission may waive any provision of its rules on its own
    motion and for good cause shown. 47 C.F.R. § 1.3. A rule may be
    waived where the particular facts make strict compliance
    inconsistent with the public interest. *Cellular Telephone Co. v.
    FCC*, 897 F.2d 1164, 1166 (D.C. Cir. 1990) (*Northeast Cellular*).
    In addition, the Commission may take into account considerations of
    hardship, equity, or more effective implementation of overall policy
    on an individual basis. *WAIT Radio v. FCC*, 418 F.2d 1153, 1157,
    (D.C. Cir. 1969), *affirmed by* *WAIT Radio v. FCC*, 459 F.2d 1203
    (D.C. Cir. 1972). In sum, waiver is appropriate if special
    circumstances warrant a deviation from the general rule, and such
    deviation would better serve the public interest than strict
    adherence to the general rule. *Northeast Cellular*, 897 F.2d at
    1166.

[^17]: *See* Request for Review of Adams County School District 14;
    Request for Waiver of Ballard County School District; Request for
    Review of Bullock County School District; Request for Review of
    Chesapeake Public Library System; Request for Review of Churchill
    County School District; Request for Review of District of Columbia
    Public Schools; Request for Review of Duluth Public Schools; Request
    for Review of Guam Department of Education; Request for Review of
    Holy Family School; Request for Review of Jefferson Parish School
    District; Request for Review of Merrimack Valley Library Consortium;
    Request for Review of Metropolitan Dayton Educational Cooperative
    Association; Request for Review of Missouri Research and Education
    Network; Request for Review of Monroe County Library System; Request
    for Review of Milwaukee Public Schools; Request for Review of Saddle
    Mountain Unified School District \# 90; Request for Review of Saint
    Louis Special School District; Request for Review of Saint Paul
    Public Schools; Request for Review of San Diego Independent School
    System.

[^18]: *See* Request for Review of Academie Cristo de los Milagros;
    Request for Review of Amesbury School District; Request for Review
    of Audre & Bernard Rapoport Academy; Request for Review of Bertie
    County School; Request for Review of Bourne Middle School; Request
    for Review of City of Baker School System; Request for Review of
    Christian Academy of Indiana; Request for Review of Compton Unified
    School District; Request for Review of Des Moines Public School;
    Request for Review of Eagle Ridge Academy; Request for Review of
    FCMA Immokalee Charter School; Request for Waiver of Fulton County
    School District; Request for Review of Hmong Academy; Request for
    Review of Information Referral Resource Assistance Independent
    School District; Request for Review of Institute for Learning
    Research, Inc.; Request for Review of Kingman Unified School
    District No. 20; Request for Review of Lapeer District Library;
    Request for Review of Leland School District; Request for Review of
    Lincolnville Central School; Request for Review and/or Waiver of
    Lowell Joint Elementary School District; Request for Review of
    Nicholas County School District; Request for Review of North
    Clackamas School District 12; Request for Review of Our Lady Queen
    of Martyrs School; Request for Review of Parma City School District;
    Request for Review of RCMA Wimauma Charter School; Request for
    Review of Russell County Public Schools; Request for Review of
    Salisbury-Elk Lick School District; Request for Review of Sanborn
    Regional School District; Request for Review of St. Ignatius School;
    Request for Review of St. Leo Catholic Urban Academy; Request for
    Review of St. Matthias School; Request for Review of St. Rose
    Catholic Urban Academy; Request for Review of Upshur County School
    District; Request for Review of Wood County Educational Service
    Center.

[^19]: *See* Request for Review of Aldar Academy; Request for Review of
    Andes Central School District; Request for Review of Beacon Academy;
    Request for Review of Campbell City Schools; Request for Review
    and/or Wavier of Cristo Rey New York High School; Request for Review
    of Fox Public Schools; Request for Review of Greater Newark Charter
    School; Request for Review of Kershaw County School District;
    Request for Review of Laredo Independent School District; Request
    for Review of Lexington County School District 1; Request for Review
    of Madison-Oneida BOCES; Request for Review of Mercedes Independent
    School District; Request for Review of Miami-Dade County Public
    Schools; Request for Review of Montgomery County School District;
    Request for Review of Richmond County School District; Request for
    Review of Southside Independent School District; Request for Review
    of Sunnyside Unified School District 12; Request for Review of
    United Talmudical Academy; Request for Review of Weatherly Area
    School District.

[^20]: 47 C.F.R. § 54.504(c). We also find good cause to waive the
    28-day competitive bidding rule with respect to one funding request
    number (FRN) for the City of Baker School System (Baker). USAC
    denied funding for the FRN after finding that Baker awarded the
    contract before the 28-day period for posting its FCC Form 470 to
    USAC's website had expired. *See* 47 C.F.R. § 54.504(b)-(c). We find
    that Baker misunderstood the competitive bidding rules and did not
    repost an FCC Form 470 because it had a multi-year contract with its
    service provider. Because Baker did not indicate that its contract
    would be multi-year when it originally requested bids, it should
    have reposted an FCC Form 470 to allow all parties to bid on the
    contract. We find that, because this contractual agreement was
    already subject to the Commission's competitive bidding rules when
    it was first entered into, Baker should not be denied needed funding
    for these pre-existing contractual agreements and, thus, we waive
    section 54.504(b) of the Commission's rules in this instance. *See*
    47 C.F.R. § 54.504(b).

[^21]: We estimate that the appeals granted in this Order involve
    applications for approximately \$27.4 million in funding for Funding
    Years 2001-2006. 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 Second Quarter 2007 (Jan. 31, 2007).
    Thus, we determine that the action we take today should have minimal
    impact on the Universal Service Fund as a whole.

[^22]: *See* Request for Waiver of Ballard County School District;
    Request for Review of Bullock County School District; Request for
    Review of District of Columbia Public Schools; Request for Review of
    Duluth Public Schools; Request for Review of Guam Department of
    Education; Request for Review of Holy Family School; Request for
    Review of Institute for Learning Research, Inc.; Request for Review
    of Jefferson Parish School District; Request for Review of
    Madison-Oneida BOCES; Request for Review of Merrimack Valley Library
    Consortium; Request for Review of Metropolitan Dayton Educational
    Cooperative Association; Request for Review of Milwaukee Public
    Schools; Request for Review of Missouri Research and Education
    Network; Request for Review of Saint Paul Public Schools; Request
    for Review of San Diego Independent School System. Although these
    schools had substantially completed their selection process for
    service providers, the contracts were not in place when the FCC
    Forms 471 were submitted because of additional steps required by
    state or local procurement laws.

[^23]: *See* Request for Review of Adams County School District 14;
    Request for Review of Chesapeake Public Library System; Request for
    Review of Churchill County School District; Request for Review of
    Fox Public Schools; Request for Review of Monroe County Library
    System; Request for Review of Saddle Mountain Unified School
    District \# 90; Request for Review of Saint Louis Special School
    District.

[^24]: 47 C.F.R. § 54.504(c). While the dates vary each year, an FCC
    Form 471 filing window is typically open from early November to
    early February preceding the start of the funding year. *See* USAC
    website, Schools and Libraries Timetable and List of Deadlines,
    \<http://www.universalservice.org/sl/tools/calendar-reminders.aspx\>
    (retrieved Feb. 14, 2007).

[^25]: *See* Request for Review of Academie Cristo de los Milagros;
    Request for Review of Amesbury School District; Request for Review
    of Audre & Bernard Rapoport Academy; Request for Review of Bertie
    County School; Request for Review of Bourne Middle School; Request
    for Review of City of Baker School System; Request for Review of
    Campbell City Schools; Request for Review of Christian Academy of
    Indiana; Request for Review of Compton Unified School District;
    Request for Review of Des Moines Public School; Request for Review
    and/or Wavier of Cristo Rey New York High School; Request for Review
    of Eagle Ridge Academy; Request for Review of FCMA Immokalee Charter
    School; Request for Waiver of Fulton County School District; Request
    for Review of Hmong Academy; Request for Review of Information
    Referral Resource Assistance Independent School District; Request
    for Review of Kingman Unified School District No. 20; Request for
    Review of Lapeer District Library; Request for Review of Leland
    School District; Request for Review of Lincolnville Central School;
    Request for Review and/or Waiver of Lowell Joint Elementary School
    District; Request for Review of Miami-Dade County Public Schools;
    Request for Review of Nicholas County School District; Request for
    Review of North Clackamas School District 12; Request for Review of
    Our Lady Queen of Martyrs School; Request for Review of Parma City
    School District; Request for Review of RCMA Wimauma Charter School;
    Request for Review of Russell County Public Schools; Request for
    Review of Salisbury-Elk Lick School District; Request for Review of
    Sanborn Regional School District; Request for Review of St. Ignatius
    School; Request for Review of St. Leo Catholic Urban Academy;
    Request for Review of St. Matthias School; Request for Review of St.
    Rose Catholic Urban Academy; Request for Review of Upshur County
    School District; Request for Review of Wood County Educational
    Service Center.

[^26]: Request for Review of Request for Review of Academie Cristo de
    los Milagros.

[^27]: Request for Review of Compton Unified School District.

[^28]: *See Request for Review of the Decision of the Universal Service
    Administrator by Bishop Perry Middle School, et al., Schools and
    Libraries Universal Service Support Mechanism,* File Nos.
    SLD-487170, *et al.*, CC Docket No. 02-6, Order, 21 FCC Rcd 5316,
    5316-17, 5319-20, paras. 2, 9 (2006) (*Bishop Perry Middle School*).
    Moreover, as noted recently in *Bishop Perry Middle School*, many
    applicants contend that the application process is complicated and
    time-consuming, and the Commission has started a proceeding to
    address, among other things, modifying the application and
    competitive bidding process for the schools and libraries support
    mechanism. *See Comprehensive Review of Universal Service Fund
    Management, Administration, and Oversight, Federal-State Joint Board
    on Universal Service, Schools and Libraries Universal Service
    Support Mechanism, Rural Health Care Support Mechanism, Lifeline and
    Linkup, Changes to the Board of Directors of the National Exchange
    Carrier Association, Inc.,* WC Docket Nos. 05-195, 02-60, 03-109, CC
    Docket Nos. 96-45, 02-6, 97-21, Notice of Proposed Rulemaking and
    Further Notice of Proposed Rulemaking, 20 FCC Rcd 11308, 11325,
    para. 40 (2005) (*Comprehensive Review NPRM*); *Bishop Perry Middle
    School,* 21 FCC Rcd at 5319-20, para. 9.

[^29]: *See* *Request for Review of a Decision of the Universal Service
    Administrator by Gayville-Volin School District 63-1, Schools and
    Libraries Universal Service Support Mechanisms*, File No.
    SLD-471545, CC Docket No. 02-6, Order, 21 FCC Rcd 9274 (Wireline
    Comp. Bur. 2006); *Request for Review of Richmond County School
    District, Schools and Libraries Universal Service Support
    Mechanisms*, File Nos. SLD-451211, 452514, 464649, CC Docket No.
    02-6, Order, 21 FCC Rcd 6570 (Wireline Comp. Bur. 2006). To the
    extent state contract law does not require two signatures and two
    dates for a valid contract, Commission precedent does not impose
    such a requirement. We note that in detailing document retention
    requirements, the Commission required both beneficiaries and service
    providers to retain executed contracts that are "signed and dated by
    both parties." *Schools and Libraries Universal Service Support
    Mechanism*, CC Docket No. 02-6, Fifth Report and Order, 19 FCC Rcd
    15808, 15825, para. 48 (2004). We clarify that this language was not
    intended to establish a new rule regarding the validity of a
    contractual agreement.

[^30]: *See* Request for Review of Aldar Academy; Request for Review of
    Andes Central School District; Request for Review of Beacon Academy;
    Request for Review of Greater Newark Charter School; Request for
    Review of Kershaw County School District; Request for Review of
    Laredo Independent School District; Request for Review of Lexington
    County School District 1; Request for Review of Mercedes Independent
    School District; Request for Review of Montgomery County School
    District; Request for Review of Richmond County School District;
    Request for Review of Southside Independent School District; Request
    for Review of Sunnyside Unified School District 12; Request for
    Review of United Talmudical Academy; Request for Review of Weatherly
    Area School District.

[^31]: *See, e.g., New Albany-Floyd County Order,* 20 FCC Rcd at
    8160-61, para. 5 (finding that applicant must repost FCC Form 470
    when contract expires mid-funding year); *Waldwick Order,* 18 FCC
    Rcd at 22995, para. 3 (denying E-rate funding because applicant did
    not have signed, binding agreement with service provider); *St.
    Joseph Order,* 17 FCC Rcd at 22500-01, para. 4 (denying E-rate
    funding when applicant inadvertently told USAC it did not have a
    binding agreement even when, in fact, it did).

[^32]: We also reverse USAC's denial of funding to District of Columbia
    Public Schools (District of Columbia) on the ground that the
    applicant's funding requests included 30 percent or more of
    unsubstantiated amounts of eligible services. As we recently held in
    the *Iroquois Order,* the 30 percent rule applies to requests for
    ineligible services, not for unsubstantiated amounts of eligible
    services. *Request for Review by Iroquois West School District 10,
    Schools and Libraries Universal Service Support Mechanism,* File No.
    SLD-343292, CC Docket No. 02-6, Order, 20 FCC Rcd 540 (Wireline
    Comp. Bur. 2005) (*Iroquois Order*); 47 C.F.R. § 54.504(d). We
    therefore direct USAC to fund the previously denied application, if
    the application is otherwise in conformity with our rules, but to
    reduce the District of Columbia's funding by the amount of the costs
    that cannot be substantiated.