Policy & Funding

FCC Under Fire for Considering Major Change to Federal Funding for School Technology

CoSN and SHLB Coalition are urging the FCC to not consolidate the cap for the Universal Service Fund into one program because it could hinder broadband connectivity funds available to schools.

• By Sara Friedman
• 06/03/19

For over 20 years, schools and libraries have been able to access funds for broadband connectivity from the Federal Communications Commission through the E-rate program. Now, the FCC is considering making a major change to the E-rate program that has the Consortium for School Networking and the Schools, Health & Libraries Broadband Coalition concerned. Under a May 31 notice for proposed rulemaking, the FCC outlines a plan to consolidate the four programs under the Universal Service Fund into a single spending cap.

These four programs — the Connect America Fund, the Lifeline program, E-rate and the Rural Healthcare program — all have a direct impact on rural communities, but the E-rate program is what schools and libraries depend on for last mile connectivity and broadband infrastructure within the school environment. For the 2018 funding year, the E-rate cap was at $4.06 billion, but schools and libraries only requested $2.77 billion from the program.

CoSN and the SHLB Coalition are trying to persuade the FCC to maintain the status quo because rolling up the USF program into one initiative could ultimately cost schools and libraries needed resources over the next few years.

“The Universal Service System works well and efficiently for teachers, students and families, while allowing telecommunications providers to use funds to expand their networks,” said CoSN CEO Keith Krueger. “Given America’s stark broadband gaps, now is not the time to pit the four USF programs against each other.”

John Windhausen, executive director of the SHLB Coalition, argues that the FCC’s plans to create a cap on the USF program run counter to the plans that Congress laid out when it established the E-rate program.

“Congress directed the FCC to make 'sufficient' funding available to meet our nation's universal service goals, not to prohibit spending that is necessary to reach those goals,” said Windhausen. “We urge the [FCC] to focus its energies on more pressing issues – such as solving the homework gap, awarding Educational Broadband Service licenses to tribes and educational entities, promoting 5G, making more unlicensed spectrum available, and fixing problems with the E-rate and Rural Health Care programs."

The FCC is asking for comments on the NPRM in terms of how to implement the cap on the USF program, and purposing changes to the budget structures of each of the four programs under USF.

FCC Commissioner Michael O’Reilly calls the NPRM necessary “to fairly and efficiently allocate scarce funds among the four programs.” O’Reilly has urged the FCC to institute a cap on the USF in the interest of sustainability of the program overall.

“This NPRM is about protecting ratepayers and demanding more thoughtfulness on the Commission’s part when it spends their money. Contrary to certain myths spread by knee-jerk opponents, this rulemaking is a first step in promoting better certainty and stability within the USF and will, in turn, help improve the viability of our broadband subsidies,” O’Reilly said in a statement.

In addition, efforts to open up the FCC’s Education Broadband Service up to industry have school advocate groups concerned. According to a study commissioned by the SHLB Coalition, leaving the EBS in the hands of educational entities and tribal nations could result in an 18.28 percent reduction in the digital divide compared to auctioning off the remaining 2.5 GHz to commercial providers which amounts 1.49 percent reduction in the digital divide.