[Federal Register: January 20, 2004 (Volume 69, Number 12)]
[Notices]
[Page 2715-2716]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20ja04-35]
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FEDERAL COMMUNICATIONS COMMISSION
[CC Docket Numbers 96-45 and 97-21; FCC 03-314]
Request for Review of the Decision of the Universal Service
Administrator by Winston-Salem/Forsyth County School District and IBM
AGENCY: Federal Communications Commission.
ACTION: Notice.
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SUMMARY: In this document, the Commission grants the Requests for
Review by Winston-Salem/Forsyth County School District, Winston-Salem,
North Carolina and International Business Machines, Inc., and remands
the Requests for Review to SLD for consideration.
DATES: The Commission's decisions on the Requests for Review addressed
in this order were effective December 8, 2003.
FOR FURTHER INFORMATION CONTACT: Andy Firth, Attorney,
Telecommunications Access Policy Division, Wireline Competition Bureau,
(202) 418-7400, TTY (202) 418-0484.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Order
in CC Docket Nos. 96-45 and 97-21 released on December 8, 2003. The
full text of this document is available for public inspection during
regular business hours in the FCC Reference Center, Room CY-A257, 445
Twelfth Street, SW., Washington, DC 20554.
I. Introduction
1. In this Order, before the Commission are Requests for Review by
Winston-Salem/Forsyth County School District, Winston-Salem, North
Carolina (Winston-Salem), and International Business Machines, Inc.
(IBM). This school and IBM seek review of decisions of the Schools and
Libraries Division (SLD) of the Universal Service Administrative
Company (Administrator) that denied Winston-Salem $16.7 million in
discounts for internal connections from the universal service support
mechanisms for schools and libraries for Funding Year 2002. For the
reasons set forth below, we grant these Requests for Review, and remand
to SLD for consideration in accordance with this Order.
2. The Commission also releases the Ysleta Order, December 8, 2003,
which addresses request for review by other applicants that also
selected IBM as their service provider. In the Ysleta Order, the
Commission finds that a number of schools in Funding Year 2002 engaged
in various practices that violated one or more of our rules regarding
competitive bidding, the weighting of price in selecting among bidders,
and the submission of bona fide requests for services under this
support mechanism. The Commission also concluded, however, that the
circumstances of those applicants justified a waiver of our rules
governing the Funding Year 2002 filing window, and allowed those
applicants to re-bid for their requested services. As set forth below,
we conclude that the facts presented in this case, unlike the cases
that the Commission addresses in the Ysleta Order, do not support a
denial of Winston-Salem's request for discounts under the program.
II. Discussion
3. We conclude, based on the record before us that SLD erred in
denying the discounts requested by Winston-Salem. The grounds upon
which we found rule violations in the Ysleta case are not present here.
4. First, we cannot conclude that Winston-Salem violated our
competitive bidding rules. Unlike the Ysleta Order, Winston-Salem did
not issue any sort of RFP for a systems integrator prior to filing its
FCC Form 471. It merely posted a request for bids for eligible services
on FCC Form 470. While we are troubled that it utilized an overly broad
FCC Form 470, that is not, in itself, a basis for denying its requests
for discounts. In the Ysleta Order, we clarified that the requirement
for a bona fide request for services means that applicants must submit
a list of specified services for which they anticipate they are likely
to seek discounts, consistent with their technology plans; they may not
list every service and product eligible for discounts under the schools
and libraries support mechanism. At the same time, we recognized that
past practices arguably could be construed as permitting broad FCC Form
470, and therefore clarified this requirement prospectively.
5. Second, we cannot conclude that Winston-Salem failed to properly
consider price when selecting its service provider because only one
party responded to its posted FCC Form 470. Its decision to enter into
a contract with the one bidder is no different than the thousands of
other applicants who receive either no bids, or only one bid, in
response to a FCC Form 470 posting. Our rules require applicants to
seek competitive bids; they do not require an applicant to have
competing bidders where none appear. While we find it unusual, given
the size of Winston-Salem's proposed project, that no other entity
submitted a bid, this alone, without more, cannot be the basis for
denying Winston-Salem's request for review. We note, however, that this
case demonstrates how an overly broad FCC Form 470 posting may well
stifle competition among service providers. In the Ysleta Order, we
clarify that prospectively such a broad FCC Form 470 is not consistent
with our rules.
6. Finally, we note that in its Request for Review, Winston-Salem
describes in detail the process it employed to select a Systems
Integrator, to demonstrate that Winston-Salem is committed to utilizing
a fully competitive selection process for the award of its contracts.
We find that Winston-Salem's
[[Page 2716]]
procedures for selecting Eperitus as a Systems Integrator are not
relevant to our decision here, because it did not seek discounts on any
services provided by Eperitus, and the services provided by Eperitus
were outside the scope of the E-rate program.
7. Therefore, we grant the above-captioned Requests for Review and
remand the Winston-Salem application to SLD. In doing so, we emphasize
that we make no determination as to whether the applicant is ultimately
entitled to any funding, as SLD must scrutinize all applications for
ineligible services and compliance with all program rules, including
all prospective clarifications enunciated in the Ysleta Order.
III. Ordering Clause
8. Pursuant to Sec. 54.722(a) of the Commission's rules, that the
above-captioned Requests for Review are granted to the extent provided
herein and remanded to SLD for further processing in accordance with
this Order.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 04-1124 Filed 1-16-04; 8:45 am]
BILLING CODE 6712-01-P