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Federal Communications Commission
1919 - M Street, N.W.
Washington, D.C. 20554
News media information 202 / 418-0500
Fax-On-Demand 202 / 418-2830
Internet: http://www.fcc.gov

FCC 98-1110
Released: June 11, 1998

CC Docket No. 96-45

On May 8, 1997, the Federal Communications Commission (Commission) released a Report and Order on Universal Service (Universal Service Order).(1) In the Universal Service Order, the Commission determined that all eligible schools and libraries should receive discounts on all telecommunications services, Internet access, and internal connections(2) provided by telecommunications carriers, as well as on Internet access and internal connections provided by non-telecommunications carriers.(3)

The Common Carrier Bureau (Bureau) reiterates that schools and libraries are not eligible to receive support for services or equipment that do not qualify as telecommunications services, Internet access, or internal connections. Personal computers, fax machines, and modems, for example, are not eligible for universal service support discounts.(4) The Bureau also emphasizes that no universal support will be provided for asbestos removal, teacher training, telephone handsets, the costs of tearing down walls to install wiring, repairing carpets, or repainting.

The Bureau also reiterates that schools and libraries are required to select the most cost effective bid when examining their bids for eligible services. This means that the price should be the primary factor in evaluating the bids. Other relevant factors may include: prior experience; personnel qualifications, including technical excellence; management capability, including schedule compliance; and environmental objectives.(5) The Bureau strongly emphasizes that the value or price competitiveness of services and products that are ineligible for universal service discounts may not be factored into the evaluation of the most cost-effective supplier of eligible services.(6)

For further information contact Matthew Vitale, Common Carrier Bureau at

(202) 418-0866.

-Common Carrier Bureau-

1. Federal-State Joint Board on Universal Service, Report and Order, CC Docket No. 96-45, FCC 97-157, 12 FCC Rcd 8776 (rel. May 8, 1998).

2. See Universal Service Order, 12 FCC Rcd at 9006-09, paras. 431-36. The Commission concluded that "a given service is eligible for support as a component of the institution's internal connections only if it is necessary to transport information all the way to individual classrooms." See Universal Service Order, 12 FCC Rcd at 9021, para. 459. Support for internal connections includes such items as routers, hubs, network file servers, and wireless LANS and their installation and basic maintenance because all are needed to switch and route messages within a school or library. Id. at para. 460.

3. Universal Service Order, 12 FCC Rcd at 9002, para. 424, and 9084-85, para. 589.

4. We note that personal computers programmed to operate solely as network switches or network file servers would be eligible for universal support.

5. Universal Service Order, 12 FCC Rcd at 9029-30, para. 481.

6. On March 27, 1998, the Schools and Libraries Corporation issued an advisory to that effect, which can be found on its website <www.slcfund.org/reference/471ORfreesvc.asp>.