The Hermon School Department’s 18-year participation in a Federal Communications Commission’s program is under investigation on allegations of improper reimbursement.
Hermon School Department is accused of using the federal government’s schools and libraries E-Rate funds to provide internet to the community and Hermon’s town office. The Universal Service Administrative Company, a department under the direction of the FCC, started an investigation in early 2023, according to a report from Superintendent Micah Grant shared with the Bangor Daily News.
The school department is reimbursed by the FCC for money it spent on internet connection through the USAC program designed for entities like schools and libraries. The FCC alleges the school was reimbursed for internet that was not used by students and staff, but instead used by Hermon community members.
The investigation is looking at how the school department used the E-Rate program from 2002 to 2006 and 2008 to 2022.
The investigation recently came to light amid discussions of a ransomware attack that took the Hermon School Department’s servers offline in early November. The scope of those problems are not yet known as an investigation continues, but the hackers likely accessed directory information, Grant said previously. An audit was completed in September, outlining multiple fixes and upgrades the school’s system needs.
It is unclear what penalties may be assessed if the FCC determines Hermon schools acted inappropriately.
The school department is cooperating with the investigation, which is ongoing, school attorney Melissa Hewey said.
“We have confidence they will come to the correct result at the end of the day,” Hewey said.
A request for comment to the FCC and USAC was not returned.
The audit into Hermon school’s E-Rate program participation could have happened at any point during the last 20 years, the report said. Instead, the FCC and USAC decided to do an audit at a time that is inconsistent with the purpose of the program.
Under FCC policy, an investigation is supposed to happen within five years of the final service in a funding year, per the report. The policy also requires only 10 years of records to be retained, so while the school department provided as many as possible it may not be all of the relevant material.
In 2002, the school built two internet circuits, one that connected the school buildings and another that connected to the Hermon town office, according to the report. Free dial-up internet was provided to community members until 2007, and the majority of use stopped in 2005.
The school built a wireless internet tower in 2007, and the town-contracted internet provider was allowed to put equipment on school property. Most, if not all, community members switched from the department internet at that time, the report said.
The internet circuit available to the town was in use until 2021, but there was a “negligible amount” of bandwidth usage and all of it was by the town hall staff, per the report.
Most of the school officials who were part of the project are no longer with the district, except for Technology Director Jeff Wheeler, according to the June report. Wheeler has since left the school and a new director was hired in December.
At the time, the superintendent and finance director created a formula to exclude internet usage from the town in the department’s requests for E-Rate reimbursement. The school excluded 20 percent of the usage a month, despite the town using far less than that, the report said.
“Based on the technology directors observations from the time, the department is confident that a very minimal amount of the department’s bandwidth was used by the community, and the town office,” the report said.
In 2018, the school requested a $760 reimbursement from the USAC, which did not include $218.40 for the town’s usage, the report said. From 2019 on, the school was requesting a $3,692 monthly reimbursement, which did not include $493.50 for the town.
The district has used more bandwidth over the years, but that’s consistent with schools using more online resources, according to the report.
“Any suggestion that the department sought increased bandwidth in order to provide internet access service to private subscribers is patently false,” the report said.
The school said it has not resold any bandwidth it bought for school buildings.
