California Educational Data Processing Association
The DataBus - Vol. 37, No. 2
February-March, 1997

BIG Discounts For Telephone and Data Services For Schools

CPUC: New rules provide reduced rates for telecommunications services for schools.

Jeff Bowser, BAE-Network

On October 25, 1996, the California Public Utilities Commission (CPUC) set new rules that established the California Teleconnect Fund. These rules were created as a result of the Federal Telecommunication Act of 1996 (see Federal Discounts below for more detail). This annual $40 million fund will provide discounts for telephone and advanced telecommunication services (i.g. wide area networking) to school and libraries throughout California. The fund generate its revenue through a 0.41% monthly surcharge on ratepayer telephone bills beginning February 1, 1997.

"These are truly watershed events for educational technology and I hope you [district superintendents] will seize these opportunities as technology becomes part of the fabric of teaching and learning," Delaine Eastin, State Superintendent of Public Instruction.

How will this affect schools? While exact information on specific discounts is not available Pacific Bell has provided Alameda County Office of Education with the following preliminary information. The program at Pacific Bell is called Discounted Advanced Services (DAS). This program is mandated by the California Public Utilities Commission to reduce specific telecommunication services by 50% on or before February 1, 1997.

Who will qualify for the discounts? The CPUC has included in the rules that only qualifying schools and libraries may receive the discounts. While the mandate does specify "schools," Pacific Bell has broadened the definition to "public, private, non-profit K-12 educational entities, and libraries eligible for Title III of the Library and Construction Act." As you can see school district and county offices of education are clearly included in the Pacific Bell definition.

What is included? Telephone or voice services: Measured Rate Business voice lines (a.k.a. 1MB) or regular school telephone lines, PBX trunks, SDS IS Centrex; Data services: Centrex IS[DN], Primary Rate ISDN, Switched 56, T-1, DS-3 (45 Mbps). The author apologizes for the jargon used above however, the most salient discounted services to schools are regular, Centrex, and PBX trunk telephone lines; ISDN services and T-1 data services.

What is not included? At this time measured services such as long distance charges, data circuit miles, and ISDN usage are not included. Further, data services such as Frame Relay, ATM and SMDS are not included. However, it must be noted that Frame Relay services (as well as the others) have two charges: the local circuit charge (T-1 for example) and the port charge (Frame Relay port, in this example). The local circuit charge will be discounted 50% but not the port charge.

How much will I save? Below is a simple chart that compares existing tariff (full price), State of California contract pricing with the new discounted rates. Please note that these prices do not include taxes and surcharges and should only be used for comparative purposes.

Services Full
1MB-Voice $ 15.05 none $ 9.89
Centrex $ 15.65 $ 13.90 $ 9.31
Centrex IS $ 31.65 none $ 18.19
PBX Trunks $ 17.59 none $ 11.16
SDS IS $ 24.82 none $ 14.78
PRI-ISDN¹ $ 220.00 none $ 110.00
Switched 56 $ 49.73 none $ 27.23
T-1² (1.54 Mbps) $ 350.00 $180.00 $ 90.00
DS-3 (45 Mbps) $2700.00 $1750.00 $ 875.00

Federal Discounts On November 7, 1996 the Federal Communications Commission (FCC) received recommendations from the Federal-State Joint Board on Universal Services that were set forth in the Telecommunications Act of 1996. A summary of their findings are as follows: 1) The FCC should establish a pre-discount price for services in a given geographical area, 2) Establish discounts that include an adjustment for schools and libraries that are defined as economically disadvantaged or located in high cost areas.

All eligible schools and libraries may receive discounts of between 20 and 90 percent on all telecommunications services, Internet access, and internal connections, subject to a $2.25 billion annual cap.

Under the rules of priority, only those schools and libraries that are most economically disadvantaged and had not yet received discounts from the universal service mechanism in the previous year would be granted guaranteed funds, until the cap was reached. Other economically disadvantaged schools and libraries would have second priority for support if additional funds were available at the end of the year. Finally, all other eligible schools and libraries would be granted funding, contingent on availability, after economically disadvantaged schools and libraries had requested funding.

Schools and libraries should be allowed maximum flexibility to purchase whatever package of telecommunications services they believe will meet their telecommunications service needs most effectively and efficiently.

The FCC should adopt a rule to provide discounts for Internet access. Internet Service Providers (ISPs) and online service providers that also offer Internet access "rely to a large degree on existing telecommunications carriers for the underlying transport facilities that constitute the Internet's backbone, as well as for local loop connections to individual Internet servers and users." ISPs and online service providers are considered non-telecommunications carriers. The discount would apply to basic conduit, i.e., non-content, access from the school or library to the backbone Internet network. This access would include the communications link to the ISP, whether through dial-up access or via a leased line, and the subscription fee paid to the ISP, if applicable. The discount would also apply to electronic mail. [excerpts from the Joint Board Findings http://www.fcc.gov/ccb/universal_service/section10.html]

If approved by the FCC the recommendations will be implemented on May 8, 1997. California expects to receive approximately $225 million of the $2.25 billion fund.

If adopted, how will the FCC rules affect the CPUC's? It is unknown at this time how the adopted rules will change the existing CPUC rules. Clearly the CPUC wanted to get ahead of the game and define, early, how they intend to implement "advanced telecommunication services" of the Telecommunication Act. However, much of the language in the FCC recommendation parallels the CPUC ruling. The FCC recommendation does include a Internet Service Provider discount that is not included in the present CPUC ruling.

For more information browse the following sites: goldmine.cde.ca.gov/ftpbranch/retdiv/technology/K-12/telecom, http://www.fcc.gov/Bureaus/Common_Carrier/Reports/decision.html#toc, and www.cpuc.ca.gov or contact Jeff Bowser at 510-670-4294 or contact Jeff Bowser at 510-670-4294.

Jeffrey A. Bowser is the Director of Bay Area Educational Network (BAE-Network), an Internet Service Provider for schools and government throughout California. He is former teacher, school site administrator, and district technology coordinator. He may be reached at 510-670-4294 or [email protected].

This article originally appeared in the Alameda County Office of Education Technology Newsletter and is reprinted by permission.

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