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Service Substitutions

1.

Criteria for Service Substitutions

2.

How to Apply for a Service Substitution

3.

Timeline for Requests / Corrections to Installed Components

4.

Service Substitutions Initiated by Service Providers Due to Discontinued Products

5.

Further Information about Service Substitutions

A Service Substitution is a change in the products and/or services specified in the Form 471 application. In certain limited circumstances, applicants or service providers may request and be approved for service substitutions.

Service substitutions encompass changes in the technical components (whether products or services or both) specified in the Item 21 Attachment for Form 471.  (Form 471 is the “Services Ordered and Certification” form submitted in the November-January filing window.)

Applicants who file Service Substitution requests must still comply with the deadlines for Form 486. For more information, please refer to Form 486 Deadlines posted in the Reference Area of this web site.

1. Criteria for service substitutions

Substitution of a service or product must meet the following conditions, which are specified in guidance from the FCC:

a.

The substituted services or products have the same functionality as the services or products contained in the original proposal.

b.

The substitution does not result in an increase in the requested pre-discount amount. (The substitution amount may be higher, but will only be funded at the amount originally approved.)

c.

The substitution does not violate any contract provisions or state or local procurement laws.

d.

The substitution does not result in an increase in the percentage of ineligible services or functions.

e.

The substitution is consistent with the establishing Form 470 posting and original RFP, if any.

(Order in CC Dockets 96-45 and 97-21, DA 01-387, released February 14, 2001, and Third Report and Order, in CC Docket 02-6, FCC 03-323, released December 23, 2003.)

As an example of a service substitution from the above Order, an applicant was granted a service substitution to use 87 six-port network modules instead of the original proposal of 58 eight-port network modules.  Similar changes are possible if they meet the above five criteria.

2. How to apply for a service substitution

Individual service substitution requests are considered minor modifications to funding requests on the original Form 471. They are submitted by letter from the applicant. As a part of the letter request, the service substitution should include the following information:

  1. Applicant name

  2. Billed Entity Number

  3. Form 471 application number

  4. Funding Request Number (FRN)

  5. Submitter of request

  6. Title of submitter

  7. Submitter phone number

  8. Submitter e-mail address

The body of the service substitution request should contain this information:

  1. From and To list

    • A listing of the products and services originally approved for which changes are requested, and a similar listing of the products and services now desired. This is sometimes described as a “from” and “to.”

      • For changes in physical equipment, the “from” and “to” should include manufacturer, model number, description/function, and cost for each line item.

      • For changes in recurring services, the “from” and “to” should include the description/function, and cost for each line item.

  2. Original commitment amount
    • Per FRN if submission is for more than one FRN. (Note: Service Substitutions are considered on the basis of individual FRNs.)
  1. Revised commitment amount (if changed)
  • If the requested substitution involves a decrease in cost, the request should not only indicate a change in monthly recurring cost, if any, but also must provide a total pre-discount amount and the effective date of change, so that the funding commitment can be accurately adjusted.
  • If the requested substitution involves an increase in pre-discount cost of an eligible item, the request will be funded at the amount originally approved.
  1. The following certifications: “I certify:

a.

that the substituted products or services have the same functionality as that contained in the original proposal,

b.

that the substitution does not result in an increase in the percentage of ineligible services or functions,

c.

that the substitution does not violate any contract provisions,

d.

that the requested change is consistent with the establishing Form 470 and any Request for Proposal for the original services,

e.

that the requested change is in compliance with all applicable state and local procurement laws, and

f.

that the applicant has secured access to all of the resources necessary to make effective use of the modified services as well as to pay the discounted charges for eligible services."

Since service substitutions are a minor modification to the original Form 471, the representations and certifications indicated in the original application continue to apply.

Any cost change submitted by an applicant in a service substitution request will be considered a request for modification of the funding commitment, just as though the applicant had submitted a Form 500 to reduce the funding commitment. Therefore, when a request that includes a cost decrease is approved, the SLD will adjust the commitment for the affected funding request.

SLD will respond in writing to the service substitution request, either approving the request or indicating the reasons why the request cannot be approved.

To view an example of a service substitution request, click here.

3.  Timeline for Requests / Corrections to Installed Components

Timing of requests.  Service substitution requests should be submitted no sooner than issuance of a Receipt Acknowledgment Letter.  Requests received prior to issuance of a Receipt Acknowledgment Letter will be returned.  If the SLD has not completed the services portion of its review of the funding request when the substitution request is logged, then the substitution request will be included in the funding request review.  The Funding Commitment Decision Letter will include a notation that the substitution request has been incorporated.  If the SLD has completed the services portion of its review of the funding request, the SLD will review and act on the substitution request separately.  As a general guideline, substitution requests received more than three weeks after a Receipt Acknowledgment Letter has been issued will likely be reviewed separately.

Deadline for submitting requests.  A service substitution request must be postmarked by the last day to receive service for that FRN.  In general, the last day to receive service is:

  • June 30 of the relevant funding year for recurring services, and
  • September 30 that follows the close of the funding year for non-recurring services.

However, the deadline for the receipt of non-recurring services may be extended beyond the September 30 that follows the close of the funding year.  Please see Service Delivery Deadlines and Extension Requests for more information.

Correcting service substitutions.  Applicants and service providers must follow the normal service substitution procedures and timelines in order to obtain pre-approval of changes.  If an unapproved change is found, the SLD may refuse to pay the invoice for products or services not originally requested.  Furthermore, if different products or services from those approved are seen during an audit, the SLD may make a commitment adjustment, and require that funds be returned.

If the applicant discovers that products or services delivered are different from those approved on the Form 471, the applicant should file a correcting service substitution.  Such a request will be considered for the case of an applicant providing correcting information.  To ensure processing of late-filed request, applicants should be sure to prominently indicate that the request is a “correcting service substitution.”  However, since SLD may only approve a substitution request if all FCC guidelines are met, applicants and service providers risk non-payment of invoices and adverse audit findings for non-approved product and service changes, and may be required to return funds previously disbursed.

4.  Service Substitutions Initiated by Service Providers Due to Discontinued Products

A service substitution can involve a product and/or service that is being discontinued, has a model number change, or is being replaced.  In this case, the manufacturer or service provider may submit notification to SLD that the product or service is being changed, along with a listing of one or more replacement products or services.

SLD will maintain the list of substitute products and/or services, so that invoices that specify the replacement product or service can be processed.  This approach can eliminate the need for many separate applicants to request service substitutions due to changed or discontinued products.  Such service substitutions will not result in a change to an applicant’s funding commitment.

The notification to the SLD must certify that the new products or services are functionally equivalent to the product or service being replaced, and have no increase in price or increase in percentage of ineligible features.  This method for service substitutions is only applicable when the product or service originally specified on the Form 471 is no longer available, or is no longer being provided by the service provider making the request.

The SLD encourages service providers to include a publicly-issued product announcement of the discontinuation or model number change in the letter request.  For an example of a service substitution requested by a service provider, click here.

No specific timeline exists for substitution filings by service providers.  However, service providers should submit model changes as early as possible to avoid delays in invoice processing.  The SLD will respond in writing to the service substitution request, either indicating acceptance of the information submitted or requesting additional information.

Applicants need not make any filing to the SLD for a service substitution request initiated by a manufacturer or service provider.  However, the change must be consistent with the establishing Form 470, the RFP (if any), and state and local procurement laws.  The SLD recommends that service providers supply each affected applicant a copy of the SLD’s acceptance letter, and that applicants keep this copy on file in the event of an audit.

5. Further Information about Service Substitutions

Requests for service substitution may be submitted by fax to (973) 599-6526.  The fax transmission should include a cover sheet listing contact name, phone number and, if available, an e-mail address.  Applications may also be submitted by e-mail (choose "Continue" and then under Topic Inquiry choose "Service Substitutions") or by regular mail to:

Service Substitutions
Schools and Libraries Division
Box 125 — Correspondence Unit
80 South Jefferson Road
Whippany, New Jersey 07981

False statements on a service substitution request carry the same penalties as those indicated in Block 6 of Form 471.

For further information, please refer to the Frequently Asked Questions for Service Substitutions.  In addition, applicants may contact the Client Service Bureau at 1-888-203-8100, and service providers may contact the Service Substitution Manager at (973) 581-5193.

Frequently Asked Questions about Service Substitutions

A Service Substitution is a change in the products and/or services specified in the Form 471 application.  Service substitutions encompass changes in the technical components specified in the Item 21 Attachment for Form 471.

To view the full service substitution procedures, click here.

Q1. What is meant by “consistent with the…original RFP, if any?” What is meant by “consistent with the establishing Form 470?”

“Consistent with the…original RFP” means that any new specification of products and services must be within the scope of what could have been considered in responses to the original RFP, if an RFP or similar procurement document was issued.

“Consistent with the establishing Form 470” means that the same functionality as indicated in the Form 470 must be maintained. See the next question for further information about “same functionality.”

Q2. Can I change the technology deployed, say from T-1 to DSL? From voice to video?

Changes must be within the same functionality. "Same functionality" means the same type of transmission — data, voice or video — and the same purpose, such as "telephone service," "local area network file server," "data distribution facilities," "lease of high speed data lines," and so on.

"Better" or "faster" within the same functionality is allowed, provided that the other requirements as given in Section 1 of this document are met. Thus a change from T-1 to DSL could be approved. However, a change to a new functionality, such as from voice to video, would not be authorized under FCC guidelines.

Q3. Can I change between funding categories, such as from Telecommunications Services to Internet Access?

No. The requirement for the same functionality means also that the same service category must be maintained.

Q4. Can the new product or service be more expensive, if discounts are not requested on that additional cost?

Yes. The FCC has clarified that "we will permit applicants to substitute an eligible service with a higher pre-discount price, but will provide support based on the lower, original price, rather than the higher price for the substituted service." (Third Report and Order, paragraph 43)

Q5. If the product or service substituted is less expensive, can SLD funds committed for the product or service represented in the original request be used for additional eligible products or services?

Additional products or services may be obtained within the same functionality provided that overall cost of the Funding Request does not increase and the applicant has the resources to make effective use of the new configuration. "Better" or "faster" products or services are allowed within the same functionality. Additional products or services that have a different functionality may not be obtained.

Q6. Can the service provider be changed when making service substitution requests?

Yes, this can be accomplished by using the procedure for changing service providers as described in the document SPIN Change Guidance posted in the Reference Area of this web site.

Applicants may make a simultaneous request for both service substitution and change in service provider by (1) following the steps for filing a service substitution as outlined in these procedures, and (2) including the letter described in the SPIN Change Guidance procedure as an additional attachment to the service substitution request.

In the event that a simultaneous service substitution and service provider change cannot be granted due to a problem with one request or the other, the SLD will contact the applicant to determine if the SLD should continue to process the remaining request.

Q7. How long will it take to receive a decision on a service substitution request?

If the submission is properly completed and requires no contact between the SLD and the applicant or service provider, the SLD attempts to reach a decision within 60 days. More time may be necessary if the request is complex, if additional information is required, or if high processing workloads exist.  To expedite processing, applicants are urged to make their service substitution requests as accurate and complete as possible.

Q8. How is “same functionality” evaluated?

 “Same functionality” is considered on the basis of individual Funding Request Numbers (FRNs).  If there is more than one function in the funding request (such as servers, routers, and cabling in the same FRN), then individual functions may increase or decrease, so long as there is no new functionality in the substitution request, and overall cost does not increase.

Technical equivalence is not mandatory for the requirement of “same functionality” to be met.  For example, network switches may be substituted for network hubs, since both provide the functionality of distributing data signals.

Q9. Can I substitute a router that has remote access capability for a router originally specified, which does not?

Yes, but approval of remote access routers requires a certification by the applicant that they will only be used for eligible purposes.  Therefore, an additional submission should be provided with the service substitution request.  The required applicant certification may be reviewed by clicking here.


Example of a service substitution request

[date]

Service Substitutions
Schools and Libraries Division
Box 125 — Correspondence Unit
80 South Jefferson Road
Whippany, New Jersey 07981

The Example School District (Billed Entity Number xxxxxx) is requesting a service substitution for application number xxxxxx and Funding Request Number xxxxxx. The specific change requested is as follows:

FROM

 

Description

Unit Cost

Extended Cost

1

Brand X Model 123 e-mail server

$3400

$3400

3

Brand Y Model 456 network switch

$1720

$5160

1

Brand Z equipment rack

$1040

$1040

40

Brand Z network cables

      $4

  $160

 

TOTAL:

 

$9760

 

TO

 

Description

Unit Cost

Extended Cost

1

Brand Y Model 789 e-mail server

$2550

$2550

4

Brand Y Model 456 network switch

$1720

$6880

0

Brand Z equipment rack

$1040

$0

20

Brand W network cables

      $5

  $100

 

TOTAL:

 

$9530

I certify:

  • that the substituted products or services have the same functionality as contained in the original proposal;
  • that the substitution does not result in an increase in the percentage of ineligible services or functions;
  • that the substitution does not violate any contract provisions;
  • that the requested change is consistent with the establishing Form 470 and any Request for Proposal for the original services;
  • that the requested change is in compliance with all applicable state and local procurement laws; and
  • that I  have secured access to all of the resources necessary to make effective use of the modified services as well as to pay the discounted charges for eligible services.

To the extent that the requested service substitution provides a decreased cost, I authorize the Schools and Libraries Division to reduce my funding commitment.

[Authorized Signature]
[Name and title of submitter]
[Applicant name and address]
[Submitter phone number]
[Submitter e-mail address]

[End of Example]



Example of a service substitution submitted by a service provider
for a discontinued product

[date]

Service Substitutions
Schools and Libraries Division
Box 125 — Correspondence Unit
80 South Jefferson Road
Whippany, New Jersey 07981

RE:  SERVICE PROVIDER SERVICE SUBSTITUTION 

Please be advised that Example Service Provider, Inc. is discontinuing the following product:

Example Model QXR-10 Tape Backup

Replacement products include:

Example Model QXR-15 Tape Backup
Example Model PAQ-10 Tape Backup

The replacement products maintain the same functionality as the discontinued product.  There is no increase in price or increase in the percentage of ineligible functions with the replacement product in comparison to the discontinued product.

Enclosed is an Example, Inc. product announcement that describes the discontinuation of the Model QXR-10 Tape Backup.

Please contact the undersigned if you would like further information about this  service substitution.

[Service Provider Signature]
[Service Provider name and address]

[End of example]



FCC Required Certification for Remote Access Components

The following statement should be signed and dated by the applicant.

“The remote access equipment for which I seek discounts either will not be used to provide remote access in the funding year or, if it is to be used remotely, I will take steps to ensure that only entities eligible for support under the Schools and Libraries Support Mechanism have the capability to access it.  In the latter case, for example, access will not be available from homes or other non-school or non-library sites.”

 Content Last Modified: May 3, 2004