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Correspondence The Committee on Energy and Commerce W.J. "Billy" Tauzin, Chairman Committee Expands Investigation Into Troubled E-Rate Program July 14, 2003 Mr. Paul Karas Dear Mr. Karas: As you may know, the Committee on Energy and Commerce, which has jurisdiction
over telecommunications issues and the Federal Communications Commission (FCC),
currently is investigating the potential for waste, fraud, and abuse in the
E-rate program - the mechanism of the Universal Services Fund (USF) that
subsidizes the deployment of telecommunications services to schools and public
libraries. In the course of our work, we have been examining documents produced by both
the FCC and the Universal Service Administrative Company (USAC), which
administers the E-rate program for the FCC. We also have received preliminary
information from certain vendors and applicants participating in the program,
and have conducted interviews with relevant individuals. Based on our review to
date, we have identified your company as having significant involvement in the
E-rate program, and thus are writing to you today to seek additional information
to assist our review. Accordingly, we request that, pursuant to Rules X and XI of the U.S. House of
Representatives, you provide the following information requested below on or
before Monday, July 28, 2003: Explain your company's organization and
operations that pertain to the E-rate program, including a description of
key company officers and employees, their principal duties and areas of
expertise, and the location of their offices. Please specify those offices
or individuals primarily responsible for business related to the E-rate
program. A list of all E-rate clients and, for each such
client, explain the types of services performed and the amount of money
received for such services during each year of the relevant time period.
Provide all contracts and agreements relating to such services. All records relating to any E-rate consulting
or other work conducted with, through, at the request of, or on behalf of
IBM, including but not limited to (i) records relating to communications
with any IBM or E-rate applicant employee, contractor, or consultant
(regardless of whether you or IBM secured a contract with such applicant);
and (ii) all contracts and statements of work agreed to between your company
and IBM. All records relating to free and reduced school
lunch eligibility in school districts to determine E-rate discount
percentages, whether relating to specific schools or districts or to your
general methodological or analytical approach. Include in your response all
records relating to ways to increase or improve the discount eligibility of
E-rate applicants' schools. All records relating to the marketing or
promotion of your E-rate services, including but not limited to (i) internal
records relating to plans, policies, or practices to increase or improve
your E-rate business; and (ii) records relating to communications with
clients or potential clients regarding increasing or maximizing E-rate
funding. All records relating to the potential
eligibility or non-eligibility of services or equipment under the E-rate
program. All records relating to the bidding process for
E-rate-funded services or equipment. All records relating to the provision of
assistance by your company to any E-rate applicant regarding development of
its Form 470 or Form 471 submission to USAC. Please note that, for the purpose of responding to these requests, the
applicable time period is January 1, 1998, to the present, unless noted
otherwise. The terms "records," "relating," and
"regarding" should be interpreted in accordance with the attachment to
this letter. Thank you for your prompt attention to this request. If you have any
questions, please contact Peter Spencer of the Majority professional staff at
(202) 225-2927. Sincerely, W.J. "Billy" Tauzin James C. Greenwood cc: Related Documents The
Committee on Energy and Commerce |