Schools and Libraries (E-Rate)

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Step 2 Selecting Service Providers

Updated January 2018

Contracts

In general, a contract is a binding agreement, enforceable by law, between two or more parties that creates an obligation to do, or not do, something. Contract definitions and requirements are contained in each state's or territory's contract law.

Except for services to be delivered under non-contracted, tariffed, or month-to-month arrangements, applicants must have a contract or other legally binding agreement with the service provider before signing and submitting a completed FCC Form 471 (Description of Services Ordered and Certification Form).

Applicants must be able to demonstrate that they had a contract or other legally binding agreement in place at the time they certified an FCC Form 471.

Applicants must also comply with state and/or local contract law. Obtaining the service provider signature and date is not a program requirement, but state and/or local contract law may include this or other requirements.

A verbal agreement is not considered a legally binding agreement under Schools and Libraries (E-rate) Program rules.

Contract Signatures and Examples

Examples of acceptable standards for applicant signature and date in a contract are:

  • Applicant's handwritten signature and date of signing
  • Date contract awarded contained in the body of the contract
  • Date contract awarded in the opening statements of the contract

When state and/or local contract law does not require the applicant to sign and date the contract, the applicant will be given the opportunity to complete a certification statement that affirms that the applicant is compliant with its state and/or local contract law.

Verbal agreements and quotes do not meet FCC requirements. Purchase orders may constitute enforceable contracts under state and/or local contract law. We recommend that if applicants intend to use a purchase order as their contract, they check their state and/or local contract laws to ensure that purchase orders meet state and/or local contract requirements and is considered to be a legally binding agreement.

Types of Contracts

Multi-Year Contracts or Contracts with Voluntary Extensions

A multi-year contract is a contract that covers more than one year. For example, a three-year contract is a multi-year contract that would expire at the end of the third year.

A contract including voluntary extensions is a contract that expires at the end of its original term, but that may be voluntarily extended for one or more years pursuant to the provisions in the contract. The decision to extend a contract with voluntary extensions must occur before the FCC Form 471 is filed for the funding year when the contract would otherwise expire.

Non-Recurring Service Voluntary Contract Extensions

FCC rules grant a limited extension of the competitive bidding rules for contracts for non-recurring services. Contracts for non-recurring services may be voluntarily extended to coincide with the appropriate deadline for the implementation of delivery and installation for non-recurring services, as long as the terms and conditions of the contract and applicable state or local contract rules allow for the extension. Parties may not, however, extend other contractual provisions beyond the dates established by the Commission's rules without complying with the competitive bidding process.

If an applicant is granted an extension of time for delivery and installation of non-recurring services, the applicant may extend the relevant contract without rebidding. Applicants must file an FCC Form 500 to notify USAC of the revised contract expiration date.

Multi-Year Contracts for Newly-Eligible Services

If the original FCC Form 470 or RFP did not include the newly-eligible services, the applicant will be required to post a new FCC Form 470 for those services.