USACE-RateApplicant ProcessBefore You Begin: Understanding Eligibility
Consortia

Step 1

Consortia

What is a Consortium?

A consortium (plural consortia or consortiums) is a group of E-Rate eligible entities that is seeking competitive bids or E-Rate funding for eligible services on behalf of its members who are E-Rate eligible entities.

Some consortia, for example, library consortia, may have been formed originally for reasons unrelated to the E-Rate program.  The consortium can be established by an organization that is not itself eligible for E-Rate support, however in order to receive E-Rate funding, consortium members that are receiving requested services must be E-Rate eligible.

Private sector entities are not eligible to be members of a consortia.

Why Create or Join a Consortium?

Forming a consortium can:

  • Aggregate demand in order to lower prices
  • Assist with state master contracts, procurements, and requests for proposal (RFPs)
  • Promote more efficient use of shared facilities
  • Assist smaller schools and libraries with guidance from consortium leaders

How Filing as a Consortium Impacts Discounts

When filing as part of a consortium, each member entity will provide their individual member discount rate. An average of these member discount rates will be auto-calculated and applied to the consortium.

For example, if two entities of a consortium have an 80& discount and the third has a 90% discount, then the discount for the consortium would be 83% (calculation below).

Combine discount rates: 80+80+90 = 250

Divide the combined discounts by the number of entities: 250/3 (number of entities) = 83

Keep the following in mind:

  • Consortia and statewide applications do not have an urban or rural status. The discount is a simple average of the member discounts, whether each individual member has an urban or rural status.
  • For C2 funding requests, use the C2 discount for each member when calculating the discount for a consortium or statewide application.
  • A consortium or statewide applicant can choose to file multiple applications if all of its members do not share all services. The discount for a consortium or statewide application applies to all services requested on the application, whether one member, a subset of members, or all members share the service.
  • Consortium and statewide applications are the only applications that can have a discount that does not appear on the discount matrix (e.g., 72 percent, 45 percent, etc.) because the consortium or statewide discount is a calculated average of the member discounts.
  • If the discount calculation results in a decimal, round down to the nearest whole number for decimals less than 0.5 and round up for decimals equal to or greater than 0.5 (e.g., 74.4 becomes 74, 62.5 becomes 63).

How to Create and Manage a Consortium in EPC

Step 1: Obtain Entity Numbers for All Consortium Members

If you are creating a new consortium, the consortium as well as each entity joining the consortium will need their own entity numbers. See the Entity Numbers page for more information.

A school district or a library system cannot file as a consortium. The school district or library system can still be a consortium leader, however, it must have two organization accounts in EPC and two BENs – one BEN and organization account for the school district or library system and a second BEN and organization account for the consortium.

  • A parent entity consortium can have members (child entities) that are also parent entities in their own right. For example, a school district can be a member of a consortium (in the role of a child entity of the parent consortium) while also acting as the parent to its own schools in the school district. In this case, the school district does not need a second entity number to identify its role as a child entity of the consortium.

If you’re forming a consortium with a large number of entities, please use the Bulk Entity Creation Template to compile all of your entity information, call the Customer Service Center (CSC) at (888) 203-8100 to create a ticket, and follow the instructions provided by CSC to submit the spreadsheet.

If Tribal Partners have any questions, please feel free to contact the USAC Tribal Liaison at TribalLiaison@usac.org.

Step 2: Establish Consortium Roles

There are two roles within a consortium; one consortium leader and the rest are consortium members.

Consortium Leader

The consortium must designate an entity as the consortium leader.  The consortium leader can be one of the E-Rate eligible entities or an outside entity, such as the organization that established the consortium.

A Tribal government can create a consortium and include its Tribally controlled schools and libraries as consortium members, and a Tribal government employee can act as the contact person for the consortium leader.

The consortium leader is responsible for:

  • Ensuring that necessary certifications are made.
  • Responding to USAC inquiries on behalf of the consortium members during both pre- and post-commitment processes (USAC’s issuance of a Funding Commitment Decision Letter (FCDL) is the event that separates pre-commitment processes from post-commitment processes.).
  • Document retention
  • Retaining a Letter of Agency(LOA) or other documentation from each consortium member to demonstrate that that member was aware of, and had expressly authorized, the actions that would be taken on its behalf by the consortium leader
    • Unless membership in the consortium is specifically required by state statute or authorized in some other way.
  • If services are shared by both eligible and ineligible entities, the consortium lead member must perform a cost allocationto ensure that only the eligible entities receive the benefit of the E-Rate discounted services.
  • Updating Consortium information during the Administrative Window.

Consortium Leader CANNOT:

  • · Edit the EPC profiles of their consortia member entities.
  • Certify or correct member discount related data

During a consortium’s special compliance review, audit, payment quality assurance (PQA) assessment or other program integrity effort, USAC will not hold the consortium financially responsible for any finding that is based on incorrect data entered by a school or library member.

Please note: Consortia Leaders are not notified when members change staff or addresses.

Pre-Commitment Responsibilities

When the consortium leader makes the FCC Form 471 certifications, the consortium leader is certifying that, among other things:

  • Each member has secured access to all the necessary resources (i.e., computers, training, software, maintenance and electrical connections) to make effective use of the requested discounts.
  • Each member has complied with state and local procurement laws as well as all E-Rate program rules.
  • That the most disadvantaged schools and libraries receive an appropriate share of benefits from shared services.

The consortium leader may be asked during the Program Integrity Assurance (PIA) application review or during an audit to provide documentation that supports these certifications.

Post-Commitment Responsibilities

The consortium leader must collect from each consortium member:

  • A signed FCC Form 479
    • The FCC Form 479 is not required if the consortium requested funding only for services to which CIPA does not apply.
    • This form must be collected from each consortia member before filing the FCC Form 471.
  • Certification by Administrative Authority to Billed Entity of Compliance with the Children’s Internet Protection Act (CIPA), to establish that member’s status under CIPA.

After all FCC Forms 479 have been collected, the consortium leader can complete the FCC Form 486, Receipt of Service Confirmation and Children’s Internet Protection Act and Technology Plan Certification Form.

Records must be retained for a period of ten years after the last day of service delivered for a particular funding year and may be requested during an audit or other review processes.

Consortium Member

Each consortium member is responsible for submitting their own FCC Form 479 (more details on this form below).

Consortia members must maintain their own EPC profiles. This includes:

  • Addresses
  • Contacts
  • Student counts
  • NSLP counts
  • Square footage
  • Urban/Rural Status
  • Category Two (C2) Budget Information

Please note that E-Rate discounts and C2 budgets are calculated using the information provided in the member entity profiles, therefore it is very important to maintain an accurate EPC profile.

See Calculating Discounts for more detailed information on the impact of the data above on how the discount rates are calculated and see Category Two Budgets for information on the C2 budgets.

These profiles should be updated each year during the Admin Window. For instructions on how to update your EPC profile, please see the How to Update Your E-Rate EPC Profile During the Admin Window eLM.

Consortia members must also respond to E-Rate outreach regarding:

  • PIA reviews
    • Consortia members are responsible for responding to reviewer outreach to validate their discount, entity eligibility, and C2 budgets.
    • If there is no pending application filed by the individual consortia member, outreach may be sent directly to the Account Administrator’s email of the individual consortia member.
  • FCC Form 479
  • FCC Form 486

Consortia Leads and Consortia Member Outreach

If the Consortia Lead wants to be copied on any outreach for all its individual member applications, they would need to discuss with the member entities that they would like to be added as a Full Rights User for those member entities.

Tracking member outreach can help Consortia Leads ensure timely responses which may help expedite PIA review time.

Step 3: Consortium Leader Collects Required Documentation from Consortium Members

Each consortium member must submit a Letter of Agency (LOA) and FCC Form 479 to their consortium leader before the consortium leader can file an E-Rate application (FCC Form 471).

Letter of Agency (LOA)

The E-Rate program rules require that a consortium members have a signed letter of agency (LOA) with the consortium lead that authorizes the consortium lead to take specific actions on behalf of each consortium member.

The letter of agency should be tailored to accurately describe:

  • What specific actions the consortium lead may take on behalf of the consortium members
    • g., file the FCC Form 470, conduct competitive bidding reviews, request funding, and/or invoice
  • That the consortium member is eligible to participate in the E-Rate program
  • That the consortium member will comply with the E-Rate program rules.

A consortium LOA is most commonly signed by consortium members and kept on file by their consortium leader to verify their knowledge of their membership and participation in the consortium.

The consortium LOA must be signed and dated on or before the date the FCC Form 471 was certified.

The document establishing the above authorization must contain all of the following:

  • The name of the person filing the application (the consortium leader)
  • The name of the person authorizing the filing of the application (the entity who will receive discounted services, such as a consortium member)
  • The specific timeframe the LOA or authorizing document covers (for example, Funding Year (FY) 2018)
  • The signature, signature date, and title of an official who is an employee of the entity who is authorizing the filing of the application (the entity who will receive discounted services, such as a consortium member); and
  • A description of type of services covered by the LOA or authorizing document (the description of services can be as general as “all Schools and Libraries (E-Rate) program eligible services” or it can be more restrictive).

The timeframes of these authorizations cannot be open-ended, such as “until terminated by either party.”

In certain situations, other documentation may be accepted as proof of authorization. For example:

  • A project agreement
  • A contract
  • A letter agreement
  • Other similar document to establish this authorization.

Consortia which have a statutory or regulatory basis and mandatory participation by schools or libraries must be able to provide documentation supporting this certification, including copies of the relevant state statute or regulation.

Refer to this sample Letter of Agency for further guidance.

FCC Form 479

Consortium members (specifically the entities of the schools or libraries that make the relevant certifications for the purpose of CIPA, known as the Administrative Authorities) file FCC Forms 479 with their consortium leader to notify the consortium leader of their status under CIPA. After the consortium leader has collected all the FCC Forms 479 from the consortium members, the consortium leader completes the FCC Form 486. The FCC Form 479 is not submitted to USAC.

When to File FCC Form 479

Consortium members should submit the FCC Form 479 to the consortium leader in time for the consortium leader to file an FCC Form 486 with USAC.  This form must be collected on an annual basis before the FCC Form 471 can be filed.

Deadline: The consortium leader cannot complete the CIPA certification on the FCC Form 486 without completed FCC Forms 479 on file. Note that if the FCC Form 486 is filed after the FCC Form 486 deadline, USAC will adjust the service start date and funding may be reduced.

FCC Form 479 Resources

Certification by Administrative Authority to Billed Entity of Compliance with the Children’s Internet Protection Act 

FCC Form 479 Instructions 

After Filing FCC Form 479

Because this form is not submitted to USAC, nor is it filed in EPC, USAC does not issue a letter in response of receipt.

Step 4: Join the Consortium in EPC

Each consortium member must join the consortium lead entity in EPC before the consortium leader can file a consortium related application (FCC Form 471) with E-Rate. For instructions on how to join a consortium or remove members, please see How to Update Your E-Rate EPC Profile During the Administrative Window eLM, Section 5: Updating Entity Relationships in EPC.

Step 5: Begin the E-Rate Process

The consortium lead will follow the steps of the E-Rate process on behalf of the consortium members.

Step 6: Invoicing as a Consortium

Selecting Invoicing Method

The invoicing method is determined for each FRN by the consortium lead and its members, in discussion with the selected service providers and initially selected on the FCC Form 471. Like other E-Rate applicants, consortia can choose between the two different invoicing methods; Billed Entity Applicant Reimbursement (BEAR) Form or the Service Provider Invoice (SPI) Form and should discuss this with their service providers as soon as possible in the selection process.

Who Pays the Non-Discounted Share?

For either invoicing method, the consortium is responsible for establishing its own process for how the consortium lead and/or the individual consortium members pay the non-discounted portion of the bill plus any ineligible equipment/services.  Consortia may use a variety of different approaches to make these payments including, but, not limited to:

  • The consortium lead collects the non-discounted portion of the bill from consortium members on a regular basis (i.e., monthly, quarterly, annually) and submits payment directly to the service provider.
  • Each consortium member pays the non-discounted portion directly to the service provider.
  • The consortium lead collects the payment from the consortium members for both the non-discounted and discounted portions of the bill to pay the service provider in full. The consortium lead then submits the BEAR Form to request reimbursement from USAC for the discounted portion of the bill.  After payment is received from USAC, the consortium lead is responsible for reimbursing the consortium members. (BEAR Method Only).
  • For some statewide consortia, the consortium lead pays the non-discounted portion of the bill to the service provider for the entire membership without collecting payment from individual members.