Chairman Wheeler Gives Glimpse of E-Rate 2.0

digital-learning-day-fcc-highlightTom Wheeler, the chairman of the Federal Communications Commission, gave an address on Digital Learning Day, February 5, 2014 that was related to the FCC’s ongoing process to modernize the E-Rate program. In the fall, the FCC requested suggestions and comments on how the program could be improved. They received over 1400 responses. It appears that the commissioners are poised to release their plan that hopefully will help meet President Obama’s goal of connecting 99 percent of all students to high-speed broadband capacity in five years.

Chairman Wheeler mentioned three principles that should guide the FCC’s efforts. The first is to focus their priorities on providing high-speed connectivity to every school and library. One way of doing this is to restructure the program so that the funding is primarily going to increase high capacity connections and reduce the funding for legacy services, such as voice. He stated that only half of the program’s funds are spent on broadband connectivity and that well less than half go to pay for the type of bandwidth that the president is desiring. When the rules are released, look for changes that focus funding on high-speed bandwidth.

The second guiding principle will be updating how they manage the E-Rate system to make it easier and more productive for schools and libraries. As anyone who has ever filed for E-Rate funding knows, it is a complicated and cumbersome process. Not just during the application for funds, but through the entire process. The chairman has indicated that they are evaluating their processes and will recommend changes and improvements. Look for the FCC to transition to an all online process in the near future.

Last, but certainly not least, he acknowledged that the FCC must ensure that there are sufficient resources to meet the modernization goals. E-Rate is 18 years old. In all those years, I can think of only one year when there was enough money to fund almost all of the Priority 2 (internal connections) requests. In fact, it is reported that there will be little to no funds available for Priority 2 requests in the funding year 2014. To help with this, they are changing the process to ensure the applications that affect the most students, will be reviewed first. This means larger districts and large consortium’s applications will be reviewed ahead of smaller districts. This is a clear sign they want to encourage districts to work with one another to hopefully get better prices because of bulk purchasing. It is reported that this change will affect the funding year 2014. However, the chairman made it clear that they intend to fund all Priority 1 services in 2014.

The FCC has also conducted a review of the funds that are available but not currently committed, and believe they have identified $2 billion that can be added to the funding year 2015. This would be a one-time infusion of funds. These are dollars that are traditionally reserved for appeals and for funding requests that haven’t been claimed by districts. In order to ensure that some of these funds are used for internal connections, there is belief that the FCC may set aside a specific amount for internal connection requests.

In addition to these suggested changes mentioned by Chairman Wheeler, there is “talk” that the FCC may include in their new rules a “1 in 5” rule instead of the existing “2 in 5” rule. This rule would result in a district only being able to receive funding for Priority 2 (internal connections) once every 5 years. A concern of the education community is that there is little evidence that the “2 of 5” rule has freed up money for internal connections for the districts that traditionally are below the 80% discount rate. Thus, there is concern that lowering it to once every five years will not have the impact that the chairman is purporting. In addition, there is still talk about changing the entire model to a per pupil funding model instead of the current model of providing discount percentages based on the poverty level of the district’s students and whether the districts are urban or rural.

What was missing in the Chairman’s comments was a commitment to raise the cap of the E-rate fund. He did imply that this was still under consideration, but first wants USAC to make some program changes to ensure it is being run as efficiently as possible before determining if it is necessary to increase funding. During the comment period in the fall, the education community spoke loud and clear that rule changes alone, without an increase in funding, would not result in achieving the president’s lofty goal of providing every student a fast connection to the Internet.

It has been rumored that the FCC will release a Public Notice next week seeking comment on a targeted set of issues. Once they release the proposed new rules, it will be necessary that the education community provide input to ensure that this very important resource is used efficiently and successfully. The president’s goal of ensuring that all schools have high-speed, affordable bandwidth is absolutely necessary in providing an engaging, relevant education for today’s students.

About Jennifer Bergland

Director of Government Relations at the Texas Computer Education Association
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