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 STATEMENT  OF  CHAIRMAN  MICHAEL  K.  POWELL 
 Re:  Schools  and  Libraries  Universal  Service  Support  Mechanism,  CC  Docket  No.  02-  6,  Fifth  Report  and  Order  and  Order 


 Today,  we  adopt  measures  to  protect  against  waste,  fraud,  and  abuse  in  the  administration  of  the  E-  rate  program.  In  particular,  we  resolve  a  number  of  issues  that 
 have  arisen  from  audit  activities  conducted  as  part  of  our  expanded  oversight  over  the  administration  of  the  universal  service  fund,  and  we  address  programmatic  concerns 
 raised  by  our  Office  of  Inspector  General. 
 To  deter  bad  actors,  E-  rate  applicants  will  be  held  accountable  for  the  contents  of  their  applications  and  other  filings.  Continuing  strong  review  and  auditing  programs 
 serve  as  a  long-  term  deterrent  to  waste,  fraud,  and  abuse.  I  am  particularly  pleased  that  my  colleagues  have  accepted  a  delegation  of  authority  to  the  Bureau  Chief  of  the 
 Wireline  Competition  Bureau  to  quickly  resolve  audits  that  uncover  instances  of  waste  fraud  and  abuse.  The  measures  we  adopt  herein  are  not  the  final  steps  we  plan  to  take  for 
 strengthening  oversight  of  the  universal  service  program  and  combating  waste,  fraud,  and  abuse.  My  fellow  Commissioners  and  I  remain  committed  to  deterring  inappropriate  uses 
 of  universal  service  monies  and  to  rapidly  detecting  and  addressing  potential  misconduct  (including  waste,  fraud,  and  abuse),  and  we  recognize  that  achieving  these  goals  is  a 
 continual  process.  While  we  recognize  that  this  item  does  not  address  the  discount  matrix  issue,  we  are  continuing  to  work  on  various  proposals  for  improving  our  oversight 
 of  the  universal  service  program,  and  we  expect  to  issue  an  order  adopting  additional  measures  in  the  near  future. 


 We  at  the  FCC  are  proud  of  the  schools  and  libraries  support  program,  but  we  will  never  be  satisfied  with  the  status  quo.  We  will  continue  to  use  all  tools  at  our  disposal  to 
 help  us  identify  areas  of  E-  rate  program  administration  that  are  vulnerable  to  fraud,  waste,  or  abuse,  and  E-  rate  applicants  will  be  subject  to  a  zero-  tolerance  policy.  At  the 
 same  time,  we  will  continue  to  encourage  participation  in  the  program  so  that  those  that  the  program’s  true  beneficiaries  –  the  nation’s  students,  library  patrons,  and  all 
 Americans  –  receive  the  support  they  need. 
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