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                                                           Before the
               Federal Communications Commission
                     Washington, DC  20554

In the Matter of                   )
                                   )
Request for Review of the          )
Decision of the                    )
Universal Service Administrator by )
                                   )
Delaplaine Public Schools          )    File No. SLD-82000
Delaplaine, Arkansas               )
                                   )
Federal-State Joint Board on       )    CC Docket No.  96-45
Universal Service                  )
                                   )
Changes to the Board of Directors of the     )    CC Docket No. 97-21
National Exchange Carrier Association, Inc.  )

                             order

Adopted:  December 13, 1999             Released: December 13, 1999

By the Common Carrier Bureau:

     1.   The Bureau has under consideration a Letter of Appeal filed by the Delaplaine School
District (Delaplaine) on September 14, 1999, seeking review of a decision issued by the Schools and
Libraries Division (SLD) of the Universal Service Administrative Company (Administrator). 
Delaplaine seeks review of the SLD's denial of its request to change a service provider for the 1998-
funding year.  This process is referred to as a Service Provider Identification Number (SPIN) change
request.  For the reasons set forth below, we deny the Letter of Appeal.

     2.   Under the schools and libraries universal service support mechanism, eligible
schools, libraries, and consortia that include eligible schools and libraries, may apply for discounts
for eligible telecommunications services, Internet access, and internal connections.
     
     3.   On February 18, 1999, Delaplaine received a Funding Commitment letter from
SLD notifying it that its request for discounts had been granted.  While the request for discounts
had been pending, however, officials at Delaplaine, unfamiliar with the E-rate grant process,
contracted with a vendor, different from its originally specified vendor, for services similar to
those included in its application for discounts.  Subsequently, on February 25, 1999, Delaplaine
wrote to SLD requesting permission to substitute vendors.  On September 7, 1999, SLD denied
the request.  The Administrator explained that it was SLD's policy to grant SPIN change requests
in only three circumstances:

       1. When the service provider refuses to participate in the E-rate program.
       2. When the service provider has gone out of business.
       3. When the service provider has breached its contract with the applicant.

Because Delaplaine's request did not satisfy any of these conditions, its request was denied.

4.        Upon review, we uphold the determination of the Administrator.  In the Universal
Service Order, the Commission determined that competitive bidding is the most efficient means
for ensuring both that eligible schools and libraries are informed about all the choices available to
them and that prices are not needlessly high.  Thus, the Commission required eligible schools and
libraries to seek competitive bids for all services eligible for discounts.  In order to maintain the
integrity of the competitive bidding system, SPIN substitutions or other changes are generally not
permitted.  Nevertheless, as noted in the Administrator's decision, SLD, with Commission
approval, determined that, in a limited number of circumstances, SPIN changes would be allowed
where the originally chosen provider was unwilling or unable to provide service.  In this case, the
need to seek a SPIN change was not necessitated by any default on the part of the original
vendor.  Rather, it resulted from the school's own voluntary action.  Thus, because Delaplaine's
SPIN change request did not fall within the enumerated exceptions, we find that the Administrator
correctly denied the request.
5.        ACCORDINGLY, IT IS ORDERED, pursuant to authority delegated under
sections 0.91, 0.291, and 54.722(a) of the Commission's rules, 47 C.F.R.  0.91, 0.291, and
54.722(a), that the appeal filed by Delaplaine Public Schools on September 14, 1999, IS DENIED.
                              

                              FEDERAL COMMUNICATIONS COMMISSION

          

                              Yog R. Varma                  
                                   Deputy Chief, Common Carrier Bureau