§  54.511   Ordering services.

   (a) Selecting a provider of eligible services. In selecting a provider
   of eligible services, schools, libraries, library consortia, and
   consortia including any of those entities shall carefully consider all
   bids submitted and must select the most cost-effective service
   offering. In determining which service offering is the most
   cost-effective, entities may consider relevant factors other than the
   pre-discount prices submitted by providers but price should be the
   primary factor considered.

   (b) Lowest corresponding price. Providers of eligible services shall
   not charge schools, school districts, libraries, library consortia, or
   consortia including any of these entities a price above the lowest
   corresponding price for supported services, unless the Commission, with
   respect to interstate services or the state commission with respect to
   intrastate services, finds that the lowest corresponding price is not
   compensatory. Promotional rates offered by a service provider for a
   period of more than 90 days must be included among the comparable rates
   upon which the lowest corresponding price is determined.

   (c) Existing contracts. (1) A signed contract for services eligible for
   discounts pursuant to this subpart between an eligible school or
   library as defined under § 54.501 or consortium that includes an
   eligible school or library and a service provider shall be exempt from
   the requirements set forth in § 54.504(a), (b)(3), and (b)(4) as
   follows:

   (i) A contract signed on or before July 10, 1997 is exempt from the
   competitive bid requirements for the life of the contract; or

   (ii) A contract signed after July 10, 1997, but before the date on
   which the universal service competitive bid system described in
   § 54.504 is operational, is exempt from the competitive bid
   requirements only with respect to services that are provided under such
   contract between January 1, 1998 and December 31, 1998.

   (2) For a school, library, or consortium that includes an eligible
   school or library that takes service under or pursuant to a master
   contract, the date of execution of that master contract represents the
   applicable date for purposes of determining whether and to what extent
   the school, library, or consortium is exempt from the competitive bid
   requirements.

   (3) The competitive bid system will be deemed to be operational when
   the Administrator is ready to accept and post FCC Form 470 from schools
   and libraries on a website and that website is available for use by
   service providers.

   (d)(1) The exemption from the competitive bid requirements set forth in
   paragraph (c) of this section shall not apply to voluntary extensions
   or renewals of existing contracts, with the exception that an eligible
   school or library as defined under § 54.501 or consortium that includes
   an eligible school or library, that filed an application within the
   75-day initial filing window for 1998 (January 30, 1998-April 15,
   1998), may voluntarily extend or renew, to a date no later than June
   30, 1999, an existing contract that otherwise would terminate between
   April 15, 1998 and June 30, 1999.

   (2) For the 1998-1999 funding year, a contract exempt from the
   competitive bid requirement, as described in paragraph (c) of this
   section, may be voluntarily extended to September 30, 1999 only to the
   extent necessary to permit delivery of the nonrecurring services
   subject to that contract and for which discounts have been approved.

   [ 62 FR 32948 , June 17, 1997, as amended at  63 FR 2130 , Jan. 13, 1998;
    63 FR 33586 , June 19, 1998;  63 FR 43097 , Aug. 12, 1998;  63 FR 70572 ,
   Dec. 21, 1998;  64 FR 22810 , Apr. 28, 1999;  68 FR 36942 , June 20, 2003]