The federal government is billed by the vendor for the amount of the discount. The Universal Service Fund is paid into by the vendors. There is a regulate bidding process which requires vendors to post on the Internet for 28 days. Organizations pick the vendor they want. Schools and libraries receive discounts based on need based on financial capability.
Financial capability is tied to the percent of free and reduced lunches in the building.
Since IPS does not budget for the discount as other organizations do not, savings can be redirected to other technology needs. One perceived weakness of this program is that the redirection of funds is not regulated. Savings could be redeployed into areas other than technology. However, a school corporation must have an approved technology plan in place before being eligible for discounts. In IPS teacher training spins off of the Universal Service Fund.