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How to Use E-RATE Funds to Purchase IT Equipment for K-12 Schools

Written by Robert Baker

 

Using E-RATE funds to purchase IT equipment for K-12 schools is done primarily through Category Two (C2) funding and requires a multi-step application and procurement process managed by the Universal Service Administrative Company (USAC).

The core process involves competitive bidding, selecting a vendor, and submitting two main forms:
Form 470 and Form 471.

 

Eligible IT Equipment (Category Two)

 

E-RATE C2 funding covers the internal network equipment needed to distribute broadband access throughout the school. This is considered internal connections and related services.

Eligible IT Equipment Ineligible IT Equipment (Must be purchased with other funds)
Routers, Switches, and Hubs Student Laptops, Chromebooks, and Tablets
Wireless Access Points (WAPs) and Controllers Desktop Computers (unless solely for network management)
Network Security (e.g., Firewalls) Software and applications (unless related to Basic Maintenance)
Structured Network Cabling Non-Instructional Facility (NIF) equipment (unless essential to connecting the instructional buildings)
Basic Maintenance for the eligible equipment (e.g., repair, upkeep, software patches) Cell phones and other mobile end-user devices
Managed Internal Broadband Services (MIBS)

 

E-RATE Application Steps for IT Equipment

 

The E-RATE process must be followed sequentially and in a specific timeline known as the Funding Year.

 

Step 1: Planning and Budget Check (August – November) 

 

  • Determine Your Need: Assess your school's or district's need for new or upgraded network equipment (Category Two).

  • Check Your C2 Budget: E-RATE funding for Category Two is subject to a pre-discount five-year budget limit per school. You must confirm the remaining balance for each school entity.

    • The budget is typically calculated based on a per-student amount for the current five-year cycle.

  • Establish Compliance: Ensure your school or district is compliant with the Children's Internet Protection Act (CIPA), which is a prerequisite for receiving C2 funding.

     

Step 2: Competitive Bidding (Form 470) 

 

  • File FCC Form 470: This form formally notifies all potential vendors that you are seeking bids for eligible equipment and services. It must be filed in the E-Rate Productivity Center (EPC) online portal.

     

    • Post an RFP: If your state or local rules require a Request for Proposal (RFP), you must upload it alongside the Form 470.

  • Mandatory 28-Day Waiting Period: E-RATE rules require the Form 470 to be posted for at least 28 days before you can select a vendor or sign a contract. This ensures a fair and open competitive bidding process.

 

Step 3: Vendor Selection and Contract (After 28 Days) 

 

  • Evaluate Bids: You must conduct a fair and thorough evaluation of all bids received. Price of the eligible equipment and services must be the primary factor in your selection process.

     

  • Select Vendor & Sign Contract: After the 28-day waiting period, select the winning vendor and sign a contract (if required for the service type).

Step 4: Requesting Funds (Form 471)

 

  • File FCC Form 471: This form is your official application to USAC for the E-RATE discount. It details the specific equipment, services, costs, vendor, and the calculated discount amount for each school entity.

    • This form must be certified after the 28-day waiting period and during the annual Form 471 filing window (typically January to March).

 

Step 5: Funding Commitment and Service Start (Form 486) 

 

  • Receive FCDL: USAC will review your Form 471 and issue a Funding Commitment Decision Letter (FCDL), which officially commits the discount funds.

     

  • File FCC Form 486: After receiving the FCDL and when services have started or equipment has been installed, you must file this form to notify USAC and certify CIPA compliance, which allows the disbursement of funds to begin.

     

Step 6: Invoicing and Reimbursement (Form 472 or SPI) 

 

  • Pay Your Non-Discounted Share: The school or district must pay the vendor for its portion of the cost.

  • Invoicing USAC: Your vendor has two options to get paid for the discounted portion:

    • SPI Method (Service Provider Invoice): The vendor bills USAC directly for the discount amount. The school pays only its non-discounted share to the vendor.

    • BEAR Method (Billed Entity Applicant Reimbursement): The school pays the vendor the full (pre-discount) amount and then files Form 472 (BEAR) to be reimbursed by USAC for the discount amount.



Tech to School's E-RATE SPIN number is: 143052843

 

You can learn more about the E-Rate program here:

 

 

 

 

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