Federal Communications Commission	DA 26-370


Before the
Federal Communications Commission
Washington, D.C. 20554


In the Matter of 
Request for Review and/or Waiver of Decision of  the Universal Service Administrator by
Magen Israel-Gan Israel Center, 
Great Neck, NY

Establishing Emergency Connectivity Fund to Close the Homework Gap
)
)
)
)
)
)
)
)
)
)



Application No. ECF202104588




WC Docket No. 21-93

ORDER

Adopted:  April 16, 2026	Released:  April 16, 2026

By the Chief, Wireline Competition Bureau:

I. INTRODUCTION
1. In this Order, we deny a request for review filed by Magen Israel-Gan Israel Center (Magen Israel) regarding an Emergency Connectivity Fund (ECF) program decision. Request for Review of Magen Israel Schools, WC Docket No. 21-93 (filed Dec. 18, 2023), https://www.fcc.gov/ecfs/search/search-filings/filing/121755876905 (Request for Review) (marked as confidential for privacy reasons).
  Specifically, the Universal Service Administrative Company (USAC) sought recovery of funding for connected devices provided in excess of the student enrollment reported to the New York State Education Department (NYSED) and the ineligibility of school staff for ECF-funded devices.  USAC denied a subsequent appeal.  Magen Israel seeks review of this recovery.  We now deny that request, and upon review of recently available information, remand the funding request to USAC to recalculate recovery and determination of the responsible party.
II. BACKGROUND
2. As part of the American Rescue Plan Act of 2021 (Act), Congress appropriated $7.171 billion and directed the Commission to promulgate rules for distributing funding from the ECF to eligible schools and libraries for the purchase of eligible equipment and/or advanced telecommunications and information services, including Wi-Fi hotspots, for use by students, school staff, and library patrons for remote learning at locations that include locations other than a school or library. American Rescue Plan Act, 2021, H.R. 1319, Pub. L. No. 117-2, 117th Cong., tit. VII, § 7402(a)(1)-(2) (2021) (enacted), available at https://www.congress.gov/bill/117th-congress/house-bill/1319/text (American Rescue Plan Act) (enrolled bill).  
  On May 10, 2021, the Commission adopted the Emergency Connectivity Fund Report and Order establishing rules for the ECF program to distribute the funding to eligible schools and libraries. See generally Establishing the Emergency Connectivity Fund to Close the Homework Gap, WC Docket No. 21-93, Report and Order, 36 FCC Rcd 8696 (2021) (Emergency Connectivity Fund Report and Order).

3. The Commission and USAC opened three application filing windows, during which applicants could request funding for eligible equipment and services received or delivered during the applicable funding periods. See 47 CFR § 54.1710; Emergency Connectivity Fund Report and Order, 36 FCC Rcd at 8734, 8737, paras. 78, 83.
  Pursuant to the Emergency Connectivity Fund Report and Order, ECF program funding was limited to requests for eligible equipment and services to meet the unmet needs of students, school staff, and library patrons that otherwise lacked access to equipment and/or Internet access services sufficient to engage in remote learning during the COVID-19 emergency period. See Emergency Connectivity Fund Report and Order, 36 FCC Rcd at 8736-37, para. 81.
  The Commission adopted a maximum support amount of $400 per connected device, but explained that reimbursement would be based on the actual costs of the equipment. 47 CFR § 54.1707(a); see also Emergency Connectivity Fund Report and Order, 36 FCC Rcd at 8731, para. 69; see also Emergency Connectivity Fund FAQs, Question 5.10, https://www.fcc.gov/emergency-connectivity-fund-faqs (last visited Apr. 8, 2026) (explaining that the reimbursement amount is based on the actual or market-based cost of the requested equipment and not the $400 or $250 reasonable support amount and that the request for reimbursement may be reduced or denied if it is determined to be unreasonable).
  Eligible school staff was limited to staff who were “providing . . . educational services during the relevant time periods [who] would otherwise lack access to . . . broadband connections sufficient to facilitate remote learning during the pandemic.” See Emergency Connectivity Fund Report and Order, 36 FCC Rcd at 8729, para. 63.
  Finally, applicants and service providers submitting requests for reimbursement were required to certify to compliance with program rules, including the accuracy of its invoices and that no kickbacks were paid or received in connection with the Emergency Connectivity Fund. 47 CFR § 54.1711(a)(2)(i) and (ix).
  
4. Magen Israel requested 40 laptops for staff and 130 Chromebooks for students in the first ECF window, each at a cost of $400 per device, far in excess of the 67 eligible students enrolled at Magen Israel according to the New York State Education Department. ECF Application No. ECF202104588, Magen Israel-Gan Israel Center, (July 26, 2021).  However, for FY 2021-2022, Magen Israel reported 67 students for pre-kindergarten through fifth grade to New York State Education Department (NYSED).  See New York State Education Department, Information and Reporting Services, Nonpublic Enrollment, 2021-22 Non-Public Enrollment by Grade, https://www.p12.nysed.gov/irs/statistics/nonpublic/enrollment-by-grade-nonpublic-2021-22.xlsx  (last visited Apr. 8, 2026).
  USAC issued a funding commitment decision letter approving the funding on September 24, 2021; See Letter from USAC, to Magen Israel-Gan Israel Center, concerned ECF Application No. ECF202104588 (Sept. 24, 2021) (Funding Commitment Decision Letter).
 and the service provider, Quality Education & Development, LLC (QED), Quality Education & Development, LLC (QED), SPIN No. 143024579.
 filed a request for reimbursement, and a $68,000 disbursement was made on January 27, 2022. See Reimbursement Decision Batch Number ECF-IN-FY2021.12 (Jan. 27, 2022) (approving funding to the service provider for SPI202100812).
  In 2023, USAC sent a number of post-commitment requests for information to Magen Israel regarding the reasonableness of the costs of the devices and the number of devices requested. See Request for Information from USAC (sent June 7, 2023).
  In response, Magen Israel explained that its consultant did everything for the application and Magen Israel could not answer the questions. See, e.g., Response to USAC from Yitzchak Chayem (sent June 13, 2023) (explaining in response to questions about cost and the selection of equipment that “we were advised by E-Rate Consulting LLC that there is a program that supplies the school with tablets or laptops that when the school is shutdown the students could use for virtual instructions, in response to how they determined unmet need that “the school didn’t prepare the application. The application was prepared by E-Rate Consulting LLC Please contact them” and in response to how they found the service provider, stating that “[t]his was a suggestions from [E-Rate Consulting LLC] … that [sic] why we chose them.  We have no clue to who or to whom to go.”).  
  Magen Israel indicated its consultant was E-Rate Consulting, LLC, and provided an engagement letter with E-Rate Management Solutions, Inc. See Engagement Letter from Magen Israel-Gan Israel Center (dated Dec. 28, 2021) (engaging E-Rate Management Solutions, Inc., where Richard Bernstein was the president, as a consultant).  Richard Bernstein is also founder and Chief Executive Officer of E-Rate Consulting, LLC.  We note that the consultant was not identified on the ECF application, as required on the ECF FCC Form 471 application form.
  On questions regarding why Magen Israel sought devices for a much higher enrollment number than it reported to the NYSED, Magen Israel stated that the number they reported to NYSED did not include all students. Response to USAC from Yitzchak Chayem (sent June 13, 2023) (stating “we have over 80 students in nursery and prenursery classes which is not recorded in NYSED”).  We note that these students are not eligible for E-Rate or ECF funding.  Eligibility of pre-kindergarten students and whether pre-kindergarten is included in the definition of elementary education is based on state law, which in this case is New York state law.  Under New York state law, eligible pre-kindergarten students are defined as “resident children who are four years of age or before December first of the year in which they are enrolled or who will otherwise be first eligible to enter public school kindergarten commencing the following year.”  N.Y. Educ. Law § 3602-e (Consol. 2024).  Children under the age of four are not eligible as pre-kindergarten students under New York state law and thus are not eligible for E-Rate or ECF funding.  
  Regarding the eligibility of their staff for 40 laptops, Magen Israel provided a list of staff positions. Response to USAC from Yitzchak Chayem (sent June 13, 2023) (stating “we have over 25 teachers & assistant teachers”).
  
5. Based on Magen Israel’s responses, on September 21, 2023, USAC sent a letter seeking to recover $30,000 in improperly disbursed funds because the school could not provide third-party documentation supporting its full-time teacher staff nor student enrollment. See Letter from USAC, to Magen Israel-Gan Israel Center (Sept. 21, 2023) (Recovery of Improperly Disbursed Funds) (reducing the commitment to remove the quantity of devices for staff and the quantity of students exceeding the number reported to the State).
  In the letter, USAC listed both Magen Israel and QED as the responsible party for recovery. Id.
  On October 19, 2023, Magen Israel appealed the recovery to USAC, See Email from Magen Israel-Gan Israel Center to USAC (sent Oct. 19, 2023).
 which USAC denied on November 14, 2023. See Letter from USAC, to Magen Israel-Gan Israel Center (Nov. 14, 2023) (USAC Appeal  Decision Letter) (denying the appeal and seeking recovery of $30,000 in improperly disbursed funds).
  QED filed a timely appeal of the decision to the Commission on December 14, 2023, requesting review of the determination that QED was a responsible party for the rule violation. Request for Review and/or Waiver of Quality Education & Development, LLC, WC Docket No. 21-93 (filed Dec. 14, 2023), https://www.fcc.gov/ecfs/search/search-filings/filing/1214045458543. 
  On December 18, 2023, Magen Israel filed an untimely request for review, challenging the conclusion that the school staff were ineligible and arguing that it had an additional 61 pre-kindergarten students that were not reported to the NYSED. Request for Review at 1.  But see supra note 16 (explaining that children under the age of four are not eligible for E-Rate or ECF support because eligible pre-kindergarten students must be four years old under New York state law). 
  On March 1, 2024, based on the program violations determined by USAC in the USAC Appeal Decision Letter, the Wireline Competition Bureau (Bureau) granted QED’s request and directed USAC to seek recovery only from Magen Israel as the party that committed the violation in question, which at that time, was related to enrollment issues. See Streamlined Resolution of Requests Related to Actions by the Universal Service Administrative Company, CC Docket No. 02-6, WC Docket Nos. 21-93, 06-122, 02-60, Public Notice, 39 FCC Rcd 2024, 2031, nn.28-29 (WCB 2024) (granting the service provider’s appeal, but explaining that the applicant’s substantive issue of recovery remained pending).
  Magen Israel’s request for review, at issue in this Order, remained pending. Request for Review.

6. In January 2026, Richard Bernstein, president of E-Rate Management Solutions, Inc., and founder and Chief Executive Officer of E-Rate Consulting, LLC, pleaded guilty to conspiracy to defraud the United States by steering ECF funds to school vendors in exchange for a share of the profits. See DOJ Press Release, School Consultant Pleads Guilty to Kickback Conspiracy Connected to Covid-Era Programs Designed to Help Schoolchildren Access the Internet (Jan. 22, 2026), https://www.justice.gov/usao-edny/pr/school-consultant-pleads-guilty-kickback-conspiracy-connected-covid-era-programs. 
  In one example of the criminal conduct, DOJ described how “Vendor #1,” which the Bureau has identified as QED, provided kickbacks after receiving ECF payments for the Magen Israel connected devices. We note that all the details included in the DOJ press release match funding request, ECF2190004982, including the number of devices, date of disbursement, and disbursement amount.
  The complaint provides details about Richard Bernstein receiving a kickback of $11,500, representing 50% of the service provider’s profits from a school’s ECF sales, in February 2022. Id.; Complaint at paras. 14-19, United States of America v. Richard Bernstein, Case 1:25-mj-00266-SDE (EDNY Sept. 10, 2025) (Complaint).  

III. DISCUSSION
7. We review Magen Israel’s appeal de novo. 47 CFR § 54.1718(e)(1) (“The Wireline Competition Bureau shall conduct de novo review of request for review of decisions issued by the Administrator.”)
  As an initial matter, we deny Magen Israel’s request for review as untimely. 47 CFR § 54.1718(b)(2) (requiring appeals to be filed withing 30 days of an affected party’s Administrator decision). 
  Even if the appeal were timely, we find that the criminal information associated with the Richard Bernstein plea deal demonstrates that QED paid kickbacks to Magen Israel’s consultant in exchange for steering schools to order devices from them. Complaint at paras. 14-19, United States of America v. Richard Bernstein, Case 1:25-mj-00266-SDE (EDNY Sept. 10, 2025) (Complaint).
  QED certified under penalty of perjury that “[n]o kickbacks, as defined in 41 U.S.C. § 8701 and/or 42 U.S.C. § 1320a-7b, were paid or received by the applicant to anyone in connection with the Emergency Connectivity Fund.” 47 CFR § 54.1711(a)(2)(ix).
  This conduct is a flagrant violation of program rules and conflicts with the statements to which the service provider certified on the service provider invoice form. 47 CFR § 54.1711(a)(2)(i) and (ix).
  Therefore, recovery of funding is required.  We remand the funding requests to USAC to seek full recovery of the Magen Israel funding commitment and redirect recovery to QED as the responsible party for this rule violation. See Federal-State Joint Board on Universal Service et al., CC Docket No. 96-45 et al., Order on Reconsideration and Fourth Report and Order, 19 FCC Rcd 15252, 15257, para. 15 (2004) (providing that the recovery action is to be directed to the party or parties that committed the rule or statutory violation in question). Consistent with the Commission’s decision to adopt the similar appeal and waiver rules that govern all of the Universal Service Fund programs, including the E-Rate program, and to leverage existing E-Rate processes and forms in the Emergency Connectivity Fund program, we rely on E-Rate program precedent. See also 47 CFR § 54.1710 (a)(1)(xiii) (stating that failure to comply with ECF program rules may result in recovery of funding).
  Here, QED was in a better position to prevent these rule violations because it was the party providing kickbacks to the consultant in exchange for finding applicants and obtaining ECF funding. See Federal-State Joint Board on Universal Service; Changes to the Board of Directors for the National Exchange Carrier Association, Inc.; Schools and Libraries Universal Service Support Mechanism, CC Docket Nos. 96-45, 97-21 and 02-6, Order on Reconsideration and Fourth Report and Order, 19 FCC Rcd 15252, 15257, paras. 15 (2004) (Schools and Libraries Fourth Report and Order) (directing USAC to consider which party was in a better position to prevent the statutory or rule violation, and which party committed the act or omission that formed the basis for the statutory or rule violation); see also Requests for Review of Decisions of the Universal Service Administrator by Achieve Telecom Network of MA, Schools and Libraries Universal Service Support Mechanism, Order, 30 FCC Rcd 3653, 3671-72, paras. 29-30 (WCB 2015) (Achieve Order) (concluding, despite violations by both parties, that the responsible party was the party in a better position to prevent rule violations).
  
8. We also find additional program compliance issues with this application.  First, we agree with USAC that Magen Israel was not eligible for 130 student Chromebooks when, at the time that it filed its ECF application, it had reported fewer students to the NYSED. New York State Education Department, Information and Reporting Services, Nonpublic School Enrollment, https://www.p12.nysed.gov/irs/statistics/nonpublic/home.html (last visited Apr. 8, 2026) (reporting 67 students in 2021-22 and 95 students in 2022-23 from pre-kindergarten to sixth grade).
  ECF applicants were required to certify, as part of their funding application, that they were only seeking support for eligible equipment provided to students and school staff who would otherwise lack access to connected devices sufficient to engage in remote learning. See Emergency Connectivity Fund Report and Order, 36 FCC Rcd at 8736-37, para. 81.
  Magen Israel’s argument that the reported enrollment did not include preschool students is contradicted by the publicly available data, which includes pre-kindergarten, and the school did not provide any third-party documentation to contradict it. See supra note 35. 
  We also do not see evidence in the inquiries and responses from the school that the connected devices were for students or eligible staff who otherwise would not have a device sufficient to fully engage in remote learning, nor that the devices were not for a one-to-one device initiative.  Second, the kickback arrangement associated with Bernstein’s guilty plea also shows a violation of the cost reasonableness requirement.  According to the criminal complaint, QED requested reimbursement from USAC for $68,000, but then provided a payment of $11,500 to Richard Bernstein’s consulting firm, along with an email stating that “it cost us $45,000 for . . . equipment.” Complaint at para. 17.
  By requesting reimbursement for $68,000 when the actual cost was just $45,000, the service provider violated the ECF program rules that reimbursement be based on the actual costs of the equipment and that the invoices be accurate and complete. See supra note 7; 47 CFR §§ 54.1707, 54.1711(a)(2)(i).

9. Finally, although we find that QED is the responsible party because it was paying kickbacks to the consultant, we remind applicants that they are responsible for understanding and complying with program rules and reliance on a consultant or other party does not excuse or demonstrate special circumstances that justify a waiver of the Commission’s rules. See, e.g., Request of Waiver or Review of a Decision of the Universal Service Administrator by Exigent Technologies, Schools and Libraries Universal Service Support Mechanism, CC Docket No. 02-6, Order, 24 FCC Rcd 12720, 12723-24, paras. 6-8 (WCB 2009) (Exigent Order) (finding reliance of a consultant, even when the service provider reported the program violation, does not excuse the service provider’s ignorance of program rules).
  Throughout the record, Magen Israel indicated that it relied completely on its consultant to select the vendor and file the ECF application on its behalf. See supra note 14.  
  Applicants may not avoid learning and complying with program rules and then deny responsibility for their consultants’ actions. See, e.g., Exigent Order, 24 FCC Rcd at 12724, para. 8.
  We encourage applicants to be vigilant, extricate themselves immediately, and inform USAC when rule violations could result in the improper disbursement of funds.
IV. ORDERING CLAUSES
10. ACCORDINGLY, IT IS ORDERED, pursuant to the authority contained in sections 1-4 and 254 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 151-154 and 254, and sections 0.91, 0.291, 54.1711(a)(2)(ix), 54.1718(b)(2) of the Commission’s rules, 47 CFR §§ 0.91, 0.291, 54.1711(a)(2)(ix), 54.1718(b)(2), that the Request for Review filed by Magen Israel-Gan Israel Center, filed December 18, 2023, IS DENIED and REMANDED to USAC in accordance with this Order for recalculation of recovery amounts for funding disbursed to Quality Education & Development, LLC and for the determination of the responsible party for recovery.


FEDERAL COMMUNICATIONS COMMISSION


Joseph S. Calascione
Chief
Wireline Competition Bureau


2