Funds for Learning Proposes E-Rate 2.0

• By Dian Schaffhauser
• 07/03/13

E-rate consultancy Funds for Learning has begun a campaign to encourage the Federal Communications Commission (FCC) to update its program for placing Internet access into schools and libraries. Among the recommendations: that a per-student amount be set each year; that funding be increased to $4.5 billion "permanently" and adjusted for inflation; that the FCC eliminate E-rate's "priority system" funding cap; and that the FCC limit how much is available to any single applicant.

According to the company, while demand for Internet access has tripled in the past 15 years, annual funding has stayed flat at about $2.4 billion.

E-rate is a program to provide schools and libraries with discounts on services and products for receiving voice, video, and data communications. The amount of the discount — between 20 and 90 percent — is set based on the level of poverty and location of the recipient organization.

Encouraged by President Obama's June announcement of the ConnectED initiative, which proposes to connect 99 percent of American students to the Internet via high-speed wireless and broadband within five years, Funds for Learning cranked up attention for the modernization campaign — E-rate 2.0 — to address what it said it sees as "skyrocketing demand for Internet access and unlimited funding" by "a handful of applicants" that could "jeopardize" the program.

The Funds for Learning proposal leaves much intact: There'd be no impact on the forms being used, the discount rates, the current application system, the eligible services list, the review process, or the payment process. Discounts could be spent on any category of E-rate eligible goods and services, and district would still obtain competitive bids for its services and pay the non-discounted portion of the implementation.

Changes would be fourfold:

• Each applicant would have a maximum amount of discounts or "grand total" it could receive each year;
• Applicants could set their own priorities, using their discounts for any service category at any site;
• Budget levels would be set annually by the FCC based on the amount of overall E-rate funding available; and
• A per-student funding limit would be set, based on current funding levels and library demand.

The company offered the following example. If the funding limit was $70 per student, the student enrollment was 2,500, and the discount rate was 64 percent, the district would receive $112,000.

In the proposal, higher budget floors could be put in place for small schools and remote rural applicants.

Implementing such changes, according to Funds for Learning, would encourage efficient use of funds and reward applicants that sought cost-effective goods and services. It would also ensure that all eligible requests receive some level of support. And it would broaden use of E-rate funding for internal connections within schools, the area of greatest need currently in funding applications, the company said.

"We have been listening to the concerns of the education community. A majority of applicants describe their current Internet infrastructure as lagging and not equipped to meet future needs," said President Cathy Cruzan. "The E-rate is essential. We agree with President Obama that the FCC should modernize the E-rate system to help ensure our students and library patrons are connected."

The company has posted information about its proposal on its Web site.