ASHINGTON, June 16 - When the El Paso school system wanted to upgrade its Internet connections three years ago, it tapped into a federal program that offers assistance for such projects. Posted on 06/16/2004 7:45:28 PM PDT by sarcasm
ASHINGTON, June 16 - When the El Paso school system wanted to upgrade its Internet connections three years ago, it tapped into a federal program that offers assistance for such projects.
The program paid the International Business Machines Corporation $35 million to build a network powerful enough to serve a small city. But the network would be so sophisticated that the 90-school district could not run it without help.
Foreseeing the problem, I.B.M. charged the district an additional $27 million, paid by the federal program, to build a lavish maintenance call-in center to keep the network running. The center operated for nine months. Then, with no more money to support it, I.B.M. dismantled it and left town.
The federal effort to help poor schools connect to the Internet, the E-rate program, which collects a fee from all American phone users to distribute $2.25 billion a year to such schools and libraries, wasted enormous sums as El Paso built its extravagant network in the 2001-2 school year, according to documents and federal lawmakers.
But the problems have not been there alone. In Brevard County, Fla., school officials used E-rate money to install a $1 million network server, a powerful device more suited to the needs of a multinational corporation, in a 650-pupil elementary school. And just three weeks ago in San Francisco, a subsidiary of the computer giant NEC agreed to plead guilty to two federal felony counts related to the program.
Across the nation in recent months - in El Paso and in New York and Pennsylvania, in Puerto Rico and Atlanta, in Milwaukee and Chicago - investigations or audits of the program have turned up not only waste but also bid-rigging and other fraud, according to lawmakers and investigators. A report issued last week by the Federal Communications Commission, which oversees the E-rate program, said 42 criminal investigations were under way.
On Thursday, Congress is to open hearings on all that has gone wrong. The hearings will be held by the House Energy and Commerce Subcommittee on Oversight and Investigations, whose chairman, Representative James C. Greenwood of Pennsylvania, says the F.C.C.'s supervision was weak.
Mr. Greenwood said that since schools often must pay only 10 percent of the cost of equipment and services while E-rate picks up the rest, "contractors have mastered the art of coming into these districts, recommending gold-plated architecture, and school officials, buying at 10 cents on the dollar, take everything they recommend.''
"You couldn't invent a way to throw money down the drain that would work any better than this," he added.
The Universal Service Administrative Company, a nonprofit government corporation overseen by the communications commission and known to school administrators as USAC (pronounced YOU- sack), is in charge of the E-rate program, which has many enthusiastic backers.
"Every mammoth government program has problems," said Gregg Downey, editor of eSchool News, a paper that covers educational technology. "The sloth, the waste and the cases of outright fraud shouldn't be a reason to get rid of a program that's doing a lot of good. This is a program that helps schools serve students better through technology."
Michael Balmoris, a spokesman for the communications commission, said that E-rate was not "waste- and fraud-free" but that abuses were not "endemic."
Narda M. Jones, an acting chief in the F.C.C. division that oversees the program, said it was designed to give schools "maximum flexibility" to build technology systems that suited their needs.
"But as the system has grown, we've seen that that design has given people an opportunity to push at the margins of the program," Ms. Jones said.
In the last year, she said, the commission has adopted rules that "significantly tighten" the wiggle room for abuse. One such rule bars people found guilty of crimes from participation, she said.
But Thomas D. Bennett, an assistant inspector general at the commission, remains concerned about oversight. He pointed to evaluations of 122 E-rate beneficiaries carried out or overseen by F.C.C. and USAC auditors in the last year or so. The auditors characterized 62 beneficiaries as "compliant" with E-rate rules, 21 as "generally compliant," and 39 - nearly a third of the total - as "not compliant," Mr. Bennett said.
"That doesn't give us much comfort that beneficiaries are complying with our rules," he said.
In the case of the $1 million server, installed for the Endeavour Elementary School in Cocoa, Fla., Mr. Bennett's auditors are midway through an examination of documents relating to the Brevard County school district's purchase of it. He declined to characterize the interim findings.
Lee A. Berry, the Brevard district's deputy superintendent, defended the purchase.
"We violated no rules," Mr. Berry said. "Was that server appropriate for that school? In our mind it was. It allowed each teacher and child to have a Web site."
In El Paso, school authorities applied for a total of $10.6 million in the first three years of the E-rate program, which got under way in 1998. They used the money they received to wire classrooms and offices.
Then El Paso formed a strategic alliance with I.B.M. and in December 2000 filed an application for $77 million, at least 20 times as much as in any previous year. Of that total, the E-rate agency ultimately disbursed about $62 million.
The I.B.M.-El Paso plan called for creation of a fiber-optic network with videoconferencing capabilities, managed by top-of-the-line switches, routers and other hardware. The project was so sophisticated, and so much money had to be spent so fast, that the district's in-house technology staff was quickly overwhelmed.
After financing was approved, I.B.M moved immediately to roll out the new network. But it took until April 18, 2002, to commence operations at the $27 million maintenance support center, Andrew Kendzie, an I.B.M. spokesman, said by e-mail in response to questions. Eleven weeks later, the budget year ended, and since I.B.M. was only renting the center to the district, its continued operation required new E-rate money.
Hoping that El Paso would gain approval of a $46 million request for the new budget year - approval that never came -I.B.M. operated the maintenance center at its own expense, of $3 million, through December 2002, Mr. Kendzie said.
"We informed the district that we could no longer continue to provide these services for free," he said, and in January of last year the company dismantled the maintenance center and left El Paso.
There had to have been some kickback arrangement for the dolts who approved this sophisticated network.
IBM's in it for the money, and milked all it could out of the district.
The question is: Who let them?
If I can get a $60 million network for $6 million, that's not something I'm going to turn down.
Does this mean that all those wires Sick Willie Clintoon and Algore were pulling in all those sad photo ops haven't solved the problems?
Fraud and waste. Fraud and waste.
Nothing to see here. Move on.
"We violated no rules," Mr. Berry said. "Was that server appropriate for that school? In our mind it was. It allowed each teacher and child to have a Web site."
Heck, on a machine like that, they could each have their own domain and instance of Apache.
Every third-grader could then learn how to be a Unix sysadmin. The O'Reilly books would really improve their reading skills, and they'd have an incentive to pay attention.
Aside from the cost of the hardware, I could have done it for only $250,000.
Thanks to the Gore tax!
Beseige my balls.
Education in the United States of America has been a money pit since I can remember looking through the eyes in my head.
Organized Crime, Unions, and Communists get paid handsomely to breed Liberals and Democrats.
I put up with the hypocracy and graduated just fine.
The only thing is that I decided to self educate myself at the tender age of seven. I'm not saying I wasn't steered wrong by a teacher or three along the way. I even took John Effing Kerry at his word, because I was up for the draft headed for Viet Nam.
If it was up to me, I'd have it so parents were especially taxed to pay for their children's schooling - maybe then they would pay more attention to what crap was being shovelled down their kid's throat.
Reminds me of the mid-1980's in the public schools in Madison Wisconsin. They were teaching kinds in grade school to program in BASIC. By the time they made it halfway through middle school that knowledge was obsolete.
I suppose in those days they might not have been faulted for knowing how short the shelf life of that knowledge was going to be - but the observation I made then ties to the technology acquisition problems reported elsewhere and evident by the ton here in Atlanta today. The AJC has just done a series showing a warehouse full of servers bought three years ago but not installed due to lack of funds for the tech support needed to install them. Huge boon to IBM and Sun and others who wanted to move some iron – but making no difference at all to a school system (APS) that is probably the worst in the country.
Well, they do have shareholders, don't they?
They do, which is why they are really faultless in this whole deal.
Some salesman got a nice commission off this deal.
$60 million for a mid-sized school district?
Poor children don't need the Internet. They need reading, writing, and arithmetic, on paper, with pencils.
At $500 for a decent PC, that's enough money to buy 120,000 computers
That's one for every person over 10 in El Paso.
We'll get a little over $60mil for it......and we'll make a handsom profit.
How IBM was able to run the bill to $60mil for El Paso's 90 schools is beyond me.
No oversight. There was no contractual ombudsman between the district and the Federal government, and IBM knew it.
The Feds appropriated the money, so they were anxious to get rid of it. The El Paso school district was glad to get it, so they said nothing.
And IBM built a Taj Mahal network and support center for the equivalent of a used car lot.
When it's "free" federal money, who cares?
< /sarcasm >
Bingo. The whores in Washington are probably upset they didn't waste even more of the money. Then they could go back to Congress and whine about how we need even more tax money appropriated "for the children."
Yes it should...
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