In the Third Report and Order, the FCC stated "recipients of support are expected to use all equipment purchased with universal service discounts at the particular location, for the specified purpose for a reasonable period of time." If equipment is not serving the entities specified on the FCC Form 471 Funding Request Number (FRN) approved by USAC, applicants need to ensure that they have not transferred the equipment in a manner inconsistent with FCC rules.
Eligible products and services purchased with Schools and Libraries Program discounts cannot be sold, resold, or transferred for money or any other thing of value, with the following exceptions:
If equipment provides service to entities that were not included on the original approved FRN, a transfer has occurred. A transfer does not automatically occur because equipment is moved or relocated. The question to ask is what entities are being served by the equipment.
In the following examples, assume that School A, School B, and School C in the same school district are sharing a router installed at School A one year ago.
Example 1: The same three schools share the router, but the router has been moved from School A to School B. No transfer has occurred because the entities sharing the service have not changed from the original approved FRN.
Example 2: School A moves the router to the District Office (Non-Instructional Facility Z). The router continues to serve Schools A, B, and C. No transfer has occurred because the same entities on the original approved FRN continue to receive service.
Example 3: School D in the same school district wants to share the router with the other three schools. Yes, a transfer has occurred because service is being provided to an entity not included in the original approved FRN.
Example 4: School B is no longer sharing the router because it has closed. No transfer has occurred, because Schools A and C were included on the original approved FRN.
See Disposal or Trade-in of Equipment for more information.
Equipment can be transferred to another eligible entity, regardless of discount level, three years or more after purchase. Transfers that occur less than five years after installation cannot be for money or anything else of value. Entities must maintain records documenting the transfer and the reason for the transfer for five years from the date of the transfer. Entities are not required to notify USAC of the transfer.
Equipment can be transferred to other eligible entities within three years of the date of purchase, even if those entities are at a lower discount level, if the particular location where the service was originally received is temporarily or permanently closed. This includes equipment serving part of a facility, such as equipment serving individual classrooms, if that portion of the facility is temporarily or permanently closed. The transferring entity must notify USAC of the transfer, and both the transferring and receiving entities must maintain detailed records of the transfer and the reason for the transfer for five years from the date of the transfer. These records must be sufficient to verify the actual location of the transferred equipment.
To notify USAC about a transfer of equipment that occurs less than three years after purchase, file an FCC Form 500 as soon as possible after the transfer has occurred.