What is Special Construction?
In December 2014, the FCC (Federal Communications Commission) approved the Second E-Rate Modernization Order, also known as E-Rate 2.0. The FCC implemented this modernization to help streamline the E-Rate program, but it also introduced Special Construction!
So what is special construction? USAC, the Universal Service Administrative Co. defines special construction as the upfront non-recurring cost of deploying or upgrading network facilities to E-Rate eligible entities. E-Rate special construction covers the construction of network facilities, design and engineering, and project management. Note: Special construction does not cover network equipment.
Has your district ever considered utilizing the special construction offering?
It's easy, here's how: When releasing an RFP for your district's network needs, you must request special construction pricing options. That's All! This will allow applicable vendors to include special construction pricing options in their bids. This is important as your district could obtain a brand new network at a hugely discounted price.
Special construction is dependent on your district's E-Rate discount. Here is an example of a district with a 90% E-Rate discount.
The district's special construction charge would be $1,000,000 Pre E-Rate. But since they are a 90% district, the cost they are responsible for is $100,000.
Still, following along? Okay, good!
Can special construction be paired with additional funding opportunities, such as a state match?
The answer is yes! Absolutely!
What is a state match?
State Match: Some states have funds that when a state contributes to a District's special construction project, the E-Rate program will match the state's contribution up to 10%.
Here is an example of How State Match funds work in conjunction with special construction!
Districts can utilize this fund in conjunction with special construction. Using the example from up above, if the district's cost to build a new network is $1,000,000, but they are a 90% district, meaning that they are only responsible for $100,000 of the $1,000,000 the district could then use state match funds, to assist in covering 5% and then E-Rate will then match another 5% totaling the remaining 10%. In this example, this construction project is completely paid for!
How can I tell if my state has state-match funds available?
Give us a call!
1.855.482. RACK (7225)
More Resources on Special Construction:
Read more on the FFC's Second E-Rate Modernization Order here.
Read more on Special Construction here.
