Why you need an e-Rate consultant (and why it cannot be me)

Imagine receiving a coupon in the mail that was redeemable at any grocery store which offered you 70% off of all bread, milk, eggs and meat. Eligibility for the coupon was conditioned upon stating your house had a refrigerator to store the items and completing a few forms before your first shopping spree. In these resource constrained times, few of you would pass up such an opportunity!

Now imagine driving to the store intending to use your coupon to find that only bread and milk were available to you, because of your income. Imagine further that it would take you several hours if not days, to complete the forms required to redeem your coupon, and that the store providing the groceries was prohibited from talking to you about how the coupon worked or how to use it. Additionally, imagine being scheduled for training meetings to learn how to complete the forms which have very time sensitive windows for completion and a long list of approved uses for the discounted groceries. And finally imagine being required to plan your menu 3 – 5 years in advance for your most costly groceries, which of course had to be approved by a complete stranger.

Your coupon suddenly becomes not quite so appealing.  Yet giving up a 70% discount (or more) on items you use every day is very appealing, and for some, quite necessary! What do you do?

This is the “stranger than a reality show” world of e-Rate at a large majority of Charter Schools. Does this sound familiar? Here is the corollary:

• E-Rate is the coupon, USAC controls who gets them, and the relative prosperity of your student’s families is part of your eligibility
• CIPA (Child Internet Protection Act) compliance is your refrigerator, which you must have to even be considered for eligibility
• Your technology service provider is the grocery store who is prohibited from assisting you in obtaining your coupon
• The groceries for which you seek the coupon are your telephone, internet, email, website, and related technology equipment bills

So how do traditional school districts do this? It usually boils down to economy of scale (which most Charter Schools don’t have). Traditional districts are sufficiently large and the funds so significant, that they can afford to hire full-time e-Rate staffers.  Such is not the case with most freestanding Charter Schools.

Is it any wonder that the Charter School Community has difficulty obtaining their fair share of e-Rate funding? With few exceptions what I observe is a complete disaster; in one case the financial losses exceeded one hundred thousand dollars (yes that is six figures worth) in a single school year. And this even happened at a school where financial management was outsourced by supposed professionals, which is truly perplexing.

Here are the most common mistakes I observe regarding e-Rate:

• Attempting to do this without a significant investment in training and time. This is not a good second duty for a principal or math teacher.
• Assuming you are ineligible for reimbursement. Certain expenses are always eligible for reimbursement, regardless of your free and reduced lunch count.
• Failing to utilize a family survey to get a more accurate e-Rate discount. This is especially important where “free lunches” run counter to social norms..
• Structuring technology resources in manner that is ineligible for reimbursement or incorrectly classifying the expenses as priority two.
• Believing (erroneously) that the money is too insignificant to justify the effort 

For most charter schools, this is simply not a task that you should attempt on your own, unless you belong to a consortium of schools that can afford a full-time professional. If you doubt my advice, all that is needed to prove my point is a simple search at the official USAC website which maintains a complete database of e-Rate reimbursement. For example, in the State of Utah in FY 2010 fewer than a dozen charter schools received any e-Rate reimbursement that was not filed by an e-Rate professional.

In states that have a large population of freestanding Charter Schools, an e-Rate consortium is an excellent idea. It essentially brings the economies of scale to individual Charter Schools by filing e-Rate as a group. However, this requires a high degree of co-operation and may provide fewer benefits for some within the consortium than others. Getting independent and highly individualistic charter schools to co-operate seems to be a challenge.

For these reasons, we strongly encourage the use of e-Rate professionals, but it is important to do your homework when selecting an e-Rate professional. There are no formal credentials in the world of e-Rate consultants, although the e-Rate Management Professionals Association is attempting to change that. In our experience, fees range widely, as do the personal interaction with your staff. Some companies provide a mostly web-based do-it-yourself interface; others have a very personal and accountable approach. Our recommendation is Kellogg & Sovereign, LLC located in Ada, Oklahoma.

Now for the “not me” part of this article. By statute, technology service providers are restricted in many aspects of the e-Rate process, especially in the pre-bid time frame. This is to prevent undue influence and fraud associated with contracting procedures, and rightly so. E-Rate fraud has been problematic in the past, which is inexcusable, but understandable as the amount of money involved is significant.

So what’s the bottom line? Decide now to get some professional assistance for your e-Rate process. We are well into the FY 2012-13 e-Rate program year. In the worst case scenario you will be dollars ahead for telephone, fax, email, and web hosting costs each month; and in the best case scenario you will receive a huge discount on those expensive technology upgrades every few years.

In these resource constrained times, you simply cannot continue to ignore this important funding mechanism.