A service substitution is a change in the products and/or services specified in the FCC Form 471 (Description of Services Ordered and Certification Form). In certain limited circumstances, applicants or service providers may request and be approved for service substitutions. In addition, service providers or equipment manufacturers may submit a “global” service substitution if, for example, they want to replace a discontinued product with a new product across all funding requests.
The certifications and representations made in the original FCC Form 471 application apply to the service substitution request. False statements on a service substitution request carry the same penalties as those indicated in the FCC Form 471 certifications.
Service substitutions encompass changes in the technical components (products, services, or both) specified in the FCC Form 471. Applicants who file service substitution requests must comply with the deadlines for the certifying the FCC Form 486 (Receipt of Service Confirmation and Children’s Internet Protection Act Certification Form).
Service Substitution Criteria
Service or product substitutions must meet the following conditions as specified in the Federal Communications Commission (FCC) rules:
- The substituted services or products have the same functionality as the services or products contained in the original proposal.
- The substitution does not violate any contract provisions or any state or local procurement laws.
- The substitution does not result in an increase in the percentage of ineligible services or functions.
- The requested change is within the scope of the establishing FCC Form 470, including any Requests for Proposal (RFPs), for the original products and/or services.
If a service substitution results in a change in the pre-discount price for the supported service, Schools and Libraries (E-rate) program funding will be based on either the pre-discount price of the product or service for which support was originally requested or the pre-discount price of the new, substituted product or service, whichever is lower.
Example: USAC approves an applicant’s request to use 87 six-port network modules at a pre-discount cost of $8,700.00 instead of a different brand of 58 eight-port network modules that were originally approved in the applicant’s FCC Form 471 at a pre-discount cost of $10,000.00. In this example, the pre-discount cost would be reduced to $8,700.00 as this is the lower price.
When to File Your Service Substitution Request
You should submit your service substitution requests after you receive a FCC Form 471 Receipt Acknowledgment Letter (RAL). Service Substitution changes identified after a RAL is issued and before an FCDL is issued, are made through the RAL modification process. Service Substitution changes identified after an FCDL is issued, are submitted in EPC through a Service Substitution request.
- If USAC has not completed the services portion of its application review when the substitution request is submitted, then USAC will include the substitution request in the review. The Funding Commitment Decision Letter (FCDL) includes a notation that USAC has incorporated the substitution request.
- If USAC has completed the services portion of its application review, we will review and act on the substitution request separately.
USAC must receive a service substitution request on or before the last day to receive service for that FRN. In general, the last day to receive service is:
- June 30 of the relevant funding year for recurring services or for non-recurring special construction charges, and
- September 30 that follows the close of the funding year for non-recurring services.
However, the deadline for the receipt of non-recurring services may be extended beyond the June 30 (i.e., special construction services) or September 30 (i.e., other non-recurring services) deadlines. (Service delivery extensions are only available for non-recurring services/charges.) If the deadline for receipt of these services is extended, the deadline for the service substitution request is automatically extended as well.
How to Submit Your Service Substitution Request
If a service substitution results in a decreased pre-discount price, the service substitution request will be considered a request for modification of the funding commitment, just as though the applicant submitted an FCC Form 500 (Funding Commitment Adjustment Request Form). Therefore, when USAC approves a service substitution request that includes a cost decrease, we will adjust the commitment for the affected funding request to reflect the decreased pre-discount cost.
Service Substitution Review
USAC’s review includes an evaluation of whether the “same functionality” is maintained between the original and proposed configuration, and whether the proposed configuration is eligible for funding. For service substitution requests involving internal connections, our review may first evaluate the substitution based on the function and product type for each line item in the “from” and “to” lists.
An internal connections service substitution request is deemed to meet FCC requirements for “same functionality” if the original and new configurations maintain consistent functions and the request does not change the type of service from one category to another.
For example, these service substitution requests meet the requirement for same functionality:
- A network switch for a network router (Function: “data distribution”).
- A UPS for a tape backup (Function: “data protection”).
USAC may only approve service substitution requests when FCC requirements for same functionality are met. USAC will respond in writing to the service substitution request, either approving the request or indicating the reason(s) why the request cannot be approved.
Service Substitution Corrections
If you need to make subsequent corrections to a service substitution, applicants must follow the normal service substitution procedures and timelines in order to obtain pre-approval of changes.
If USAC finds an unapproved change during the invoice review process, USAC will refuse to pay the invoice for products or services that were not originally requested. Furthermore, if, during an audit, USAC discovers different products or services were installed and/or delivered from those that were approved, USAC may make a commitment adjustment and require that you return the funds that were disbursed incorrectly for unapproved products or services.