The FCC\x92s 6th Report and Order (http://bit.ly/fDJQib) has created fundamental changes in the E-rate program. Below is a summary of these changes. The first two sections are the most impactful.

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CIPA - Paragraph 9 \x96 Need to be CIPA compliant even if you only get E-rate for transport and not for internet access o Goes against previous guidance o FCC has taken it under advisement

Tech Plans for Priority One Services - For FY2011 and onward o No tech plans will be necessary for Priority One services * Tech plans may still be required for other state or federal purposes - Tech plans are still needed for Priority Two funding - No more budget section in technology plans (covered by the Item 25 certification about sufficient funds to cover non-discounted portion) - No change to approval process - Category of service changes could make some old Priority One services Priority Two - The requirement to document the date on which the tech plan has been created has now been codified in the rules.

Eligible Services List - USAC now required to submit changes to ESL by March 30th (used to be June 30th) - FY2011 window will not open until sometime after Jan. 1, 2011 and will stay open until mid-March. - Not in ESL o Software that communicates with wireless devices o Enhanced firewalls and intrusion detection devices o Antivirus and spam o Online backup o Scheduling services o Unbundled warranties * Separately priced warranties are INELIGIBLE \x95 FCC sees it as a type of retainer, not an actual service % Further guidance to come o Wireless internet access applications - In ESL o Web hosting still eligible as Priority One * Now includes features of web hosting that facilitate communication \x95 Blogging \x95 Email \x95 Forums \x95 Instant messaging \x95 Chat o Basic firewalls o Routine maintenance (filed under BMIC)

Dark and Lit Fiber - Dark fiber must be in Internet Access category of service, Priority One - 6th Report and Order allows for leasing of dark fiber o Cannot build or purchase WANs - New category = \x93Telecommunications\x94 o Not \x93Telecommunications Services\x94 o Lit or dark fiber o Leased excess capacity dark fiber is ELIGIBLE * Only existing fiber, not new o On Form 471 check either the Telecommunications Service checkbox or Internet Access checkbox based on whether the carrier is an approved telecommunications carrier or a non-telecommunications carrier - Dark fiber must be lit immediately! - Modulating electronics are INELIGIBLE

Codifying Fair and Open Competitive Bidding Process - All bidders must have access to the same information and be treated in the same manner - Any changes to the 470/RFP must be available to all bidders at the same time

Gifts - Do not accept anything over $20 in value from service providers.

Competitive Bidding Process (Form 470) - Must use the new 470 after the effective date of the new form, not the effective date of the order.

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