Q for the FAQ about consortia & discounts

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The Montgomery County Library & Information Network Consortium (MCLINC)
would like to submit a question about calculating discounts for a
consortium.  According to question/answer #15 on the FAQ list released
July 2, 1997 by the FCC
(www.fcc.gov/Bureaus/Common_Carrier/Public_Notices/1997/da971374.html) a
library system ordering services on behalf of its branches which are
located in different school districts must add the discount percentages
for each branch then divide by the number of branches.  Would a consortium
whose members are all public libraries (some with branches, others being
single sites) do the same?

Is the consortium expected to figure out the discount each member would
have received had it applied for its discount directly and pass that exact
discount back to the consortium member, or can the consortium use the
aggregate discount earned by all members as a group to lower the total
consortium operating costs before computing each member's fees for
consortium participation?

Our consortium computes annual membership fees using a formula based on
the number of members, the number of separate sites, and the number of
workstations operating on our wide area network instead of billing each
member for the actual services they use.

We are unclear about whether the consortium's quarterly billing of the
annual
operating costs (which include but are not limited to Internet service
and telecommunications links between the individual servers on the WAN)
might be interpreted as "reselling" or might require the consortium to
pass through to each member the exact dollar amount of the
telecommunication discount the consortium member earns individually.  The
language in the FCC rule seems to encourage the formation of consortia
to obtain volume discounts. On the other hand, the information about how
consortia will handle discounts so far seems confusing, complex, and may
even harbor a disincentive to go with a larger group to libraries that
might have qualified for a high discount on their own. - from Laurie
Tynan, Dir. Montgomery Co. Library & Board of Dir. of MCLINC.

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