**Before the**

**Federal Communications Commission**

**Washington, DC 20554**

In the Matter of )

)

)

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. )

)

Service Provider Identification Number )

(SPIN) Change Appeals Submitted by )

Eligible Schools and Libraries )

)

**order**

**Adopted: November 21, 2000 Released: November 22, 2000**

By the Deputy Chief, Common Carrier Bureau:

1.  This Order remands to the Schools and Libraries Division (SLD) of
    the Universal Service Administrative Company (USAC or
    Administrator)[^1] Letters of Appeal filed by certain parties in
    regards to service provider changes under the federal universal
    service programs for eligible schools and libraries.[^2] This
    process of changing service providers is referred to as a Service
    Provider Identification Number (SPIN) change request. For the
    reasons discussed below, further review and reconsideration of these
    Letters of Appeal by SLD is warranted in light of the Commission's
    decision to modify the current categories of permissible SPIN
    changes.[^3]

# BACKGROUND

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 on eligible
    telecommunications services, Internet access, and internal
    connections.[^4] In the *Universal Service Order*, the Commission
    determined that competitive bidding is the most efficient means for
    ensuring that eligible schools and libraries are informed of the
    choices available to them and receive the lowest prices.[^5] Thus,
    the Commission's rules require eligible schools and libraries to
    seek competitive bids for all services eligible for discounts.[^6]
    In adopting rules governing the application and competitive bidding
    processes, the Commission did not address the situation in which a
    school or library could change service providers after the school or
    library has submitted an FCC Form 471 application designating a
    particular service provider. Indeed, section 54.504(c), which makes
    commitments of support contingent upon the applicant's filing of an
    FCC Form 471 identifying the service provider with which the
    applicant has signed a contract, makes no provision for a change of
    providers once a commitment of support has been made.[^7]

3.  To avoid penalizing an applicant that discovers only after filing
    its FCC Form 471 that its service provider is unwilling or unable to
    provide service to the applicant, SLD originally announced, after
    consultation with Commission staff, that SPIN changes would be
    allowed when a service provider: (1) refuses to participate in the
    schools and libraries support mechanism; (2) has gone out of
    business; or (3) has breached its contract with the applicant. The
    original guidelines also required that the substitute service
    provider selected must have participated in the applicant's
    competitive bidding process.

4.  In the *Copan Order*, released on March 16, 2000, the Commission
    modified the current categories of permissible SPIN changes and
    provided further guidance on when SPIN changes may be allowable.
    Specifically, the Commission stated that SPIN changes shall be
    permitted whenever an applicant certifies that (1) the SPIN change
    is allowed under its state and local procurement rules and under the
    terms of the contract between the applicant and its original service
    provider, and (2) the applicant has notified its original service
    provider of its intent to change service providers.[^8] The
    Commission stated that it would no longer restrict SPIN changes to
    those categories currently enumerated in the SLD guidelines (*i.e.,*
    service provider refuses to participate, has gone out of business,
    or has breached its contract), in order to avoid penalizing an
    applicant that either would be entitled to a SPIN change under the
    current guidelines but for a lack of particular documentation, or
    whose justification for a SPIN change, however reasonable, did not
    fit squarely within the three pre-*Copan* exceptions.[^9]

# DISCUSSION

5.  The parties listed in Appendix A of this Order have all filed
    Letters of Appeal with the Commission, protesting SLD's denial of
    their SPIN change requests.[^10] All of these SPIN change requests
    were acted upon by SLD prior to the Commission's decision in the
    *Copan Order.* In each of these Letters of Appeal, SLD denied the
    applicant's request for the SPIN change because the request did not
    fall squarely within one of the original three pre-*Copan*
    categories. In light of the Commission's revisions to the standards
    for permissible SPIN changes in the *Copan Order*, we remand these
    Letters of Appeal to the Administrator for reconsideration pursuant
    to the Commission's revised SPIN change policy.

# ORDERING CLAUSE

6.  Accordingly, IT IS ORDERED, pursuant to sections 1-4, and 254 of the
    Communications Act of 1934, as amended, 47 U.S.C. §§ 151-154 and
    254, and sections 54.719 and 54.722 of the Commission's rules, 47
    C.F.R. §§ 54.719 and 54.722, that the Letters of Appeal filed by the
    named parties to this Order ARE REMANDED to the Schools and
    Libraries Division for further consideration as provided herein.

> FEDERAL COMMUNICATIONS COMMISSION
>
> Carol E. Mattey
>
> Deputy Chief, Common Carrier Bureau

**APPENDIX A**

**LIST OF APPEALS REMANDED**

[Application Number]{.underline} [Applicant]{.underline}

127441 Baldwin County School System

134465 Beck Area Career Center

140404 Bethlehem Lutheran School

82409 Big Springs Union Elementary School District

115328 Borger Independent School District

42242 Bowlegs Independent School District 3

150889 Campbell County Public Schools

151145 Chehalis School District

108063 Chinle Unified School District #24

423324 Cloudcroft Municipal Schools

47392 East Boston Central Catholic School

33518 Four County Library System

10860 Grants/Cibola County Schools

64568 Henryetta Public Schools

114343 Hillsboro School District 1J

152241 Kelso School District

154065 Kyle Community Library

122114 Minneapolis Public Library

66154 North Country Union High School

16647 Paris Independent School District

81607 Santa Cruz Valley Union High School District 840

102180 Sasakwa Independent School District 10

79678 School District of Baraboo

55717 Sisseton School District 54-9

127948 South Boston Harbor Academy Charter School

108260 Southeast Area Cooperative

37391 St. Mary\'s School - Rosebank

82430 St. Peter\'s Elementary School

144087 Stephenson Area Public Schools

115936 Westwind Academy Charter High School

35321 Whiteville City School System

[^1]: 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).

[^2]: *See* Appendix A, *infra,* for a list of specific appeals remanded
    to SLD pursuant to this Order.

[^3]: *See* *Request for Review of Decision of the Universal Service
    Administrator by Copan Public Schools, Copan, Oklahoma,* Order*,*
    File No. SLD-26231, CC Dockets No. 96-45, 97-21, FCC 00-100, 15 FCC
    Rcd 5498 (rel. March 16, 2000) (*Copan Order*).

[^4]: 47 C.F.R. §§ 54.502, 54.503.

[^5]: *Federal-State Joint Board on Universal Service,* CC Docket No.
    96-45, Report and Order, 12 FCC Rcd 8776, 9029, para. 480 (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, reversed in part, and
    remanded in part, Texas Office of Public Utility Counsel v. FCC*,
    183 F.3d 393 (5^th^ Cir. 1999) (affirming *Universal Service Order*
    in part and reversing and remanding on unrelated grounds), petitions
    for cert. pending.

[^6]: 47 C.F.R. § 54.504.

[^7]: 47 C.F.R. § 54.504(c).

[^8]: *Copan Order*, 15 FCC Rcd at 5501, para. 6.

[^9]: *Copan Order*, 15 FCC Rcd at 5501, para. 6.

[^10]: Section 54.719(c) of the Commission's rules provides that any
    party aggrieved by an action taken by a division of the
    Administrator may seek review from the Commission. 47 C.F.R.
    §54.719(c).