FCC Approves E-Rate Reform to Boost Funding for Broadband

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A house divided at the Federal Communications Commission (FCC) approved giving more money to schools and libraries for purchasing equipment and services for Wi-Fi and broadband access.

On July 11, the FCC voted to approve Chairman Tom Wheeler’s proposal to “revitalize” the E-Rate program (otherwise known as the “Schools and Libraries Program of the Universal Service Fund”). This marks the first major update to E-Rate in 17 years, since it was first implemented in 1997. The new E-rate rules are set to go in effect by the beginning of the 2015-2016 school year.

The spotlight is on a marked increase in the program’s budget, which will provide “an additional $5 billion for Wi-Fi over the next five years.” (PDF) Here’s how that number is broken down:

  • In addition to the E-rate’s annual $2.4 billion budget, there were be “an additional $2 billion to support Wi-Fi over the next two years through improved financial management practices that free up excess reserves.”
  • For each of the following three years, the program will allocate $1 billion to provide Wi-Fi services to schools and libraries “by phasing out support for non-broadband services, such as pagers and phones, and through increased efficiencies.”

The journey to approval was not easy--and neither is acceptance of the decision. The 3-2 vote was split along party lines. Joining Wheeler in supporting the proposal were Democratic commissioners Jessica Rosenworcel and Mignon Clyburn. Republicans Ajit Pai and Michael O’Rielly opposed it, questioning whether public taxpayers are ready to foot the bill. Said Pai: “In five months, maybe six, we'll be back at this table discussing how much to increase Americans' phone bills.” (Money for E-Rate comes from the Universal Service Fund, which is funded by surcharges on phone bills.)

According to the FCC fact sheet, a portion of the money will come from ending E-rate support for outdated telecommunication and “existing reserve accounts.”

Education organizations are showing their support. In a press release, State Educational Technology Directors Association (SETDA) executive director Douglas Levin said: "With today's vote, the FCC has taken a critical step to guaranteeing the 18-year-old E-rate program can continue to fulfill its critical role of ensuring equity of access to learning opportunities and supporting innovations in teaching and learning in a digital age.”

EducationSuperHighway CEO Evan Marwell sees this decision as a win for schools and libraries across the country, telling EdSurge: “Libraries actually came out in support of the chairman’s order, along with many state departments of education from Ohio, Mississippi, Arkansas, New Hampshire, and a number of other states, as well as district superintendents.”

He also sees this as a call to action for his nonprofit: “This now gives us marching orders for how we need to help schools going forward...We need to put together a buyer’s guide for schools to know what’s out there.”

Also supporting the decision is Dennis Van Roekel, president of the National Education Association, who earlier called Wheeler’s proposal a “bad public policy.” He and the 3 million members of the teachers’ union “will be watching very closely over the next two years to ensure the very schools and libraries that have been isolated the most are not unduly harmed.”

The FCC says the proposed changes will “potentially provide a 75 percent increase in Wi-Fi funding for rural schools over the next five years,” and also approved $100 million for rural broadband expansion experiments. It believes these program improvements will deliver Wi-Fi to “an additional 10 million students in 2015 alone.”

Tony Wan also contributed to this report.

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