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Rewrite of E-Rate Program Could Cover Technology Outside Schools

By guest blogger Ben Kamisar

With the final public comment period on proposed changes to the E-rate having come to a close, one of the most intruging questions to emerge is whether the federal program should cover the costs of paying for students' web access outside of school.

The E-rate program provides discounts for Internet services for schools and libraries, but currently only covers connections that go into those buildings.

In July, as the Federal Communications Commission embarked on an effort to overhaul a program that many call underfunded and misaligned with the latest trends in technology, the agency asked for input on the possibility of expanding the program's rules to cover broadband access in homes and other out-of-school environments through wireless hotspots and other tools. 

The FCC has received roughly 1,400 comments about its proposed rule changes to the approximately $2.4 billion program from advocacy groups, telecommunications companies, and other interested parties. While many commenters expressed a need to raise that funding cap to around $5 billion, opinions were divided on whether the E-rate should pay for wireless hotspots located away from school or library grounds.

A major publisher and Education company, McGraw-Hill Education, threw its support behind covering out-of-school broadband access. In the company's public comments, it noted that 2011 U.S. Census data shows that households with annual salaries over $100,000 are more than twice as likely to have home broadband access as households with earnings of $25,000 per year.

"Students who are without broadband access at home, disproportionately low-income students, are placed at a significant disadvantage relative to students with at-home broadband access," the company wrote. "The commission can take a major step to narrow the digital gap for low-income families and students by permitting schools to provide wireless hotspots to surrounding communities using E-rate-supported broadband."

Sprint Corporation, the third-largest wireless carrier in the U.S., also called for the FCC to include support for off-campus access. Both companies agreed that firewall restrictions should be kept in place for publically funded projects, limiting internet use to only authorized sites.

But to critics of the idea, including telecom company Verizon, expanding E-rate funding to include wireless community hotspots would be a mistake.

"The E-Rate fund is already stretched and network construction is expensive," Verizon said in its comments.  "Using E-rate to fund construction by schools or libraries—which are not best suited to building telecommunications networks in any event—will unnecessarily divert funds that other schools and libraries could use to obtain high-capacity connections. "

USTelecom, the Washington-based lobbying association for telecommunications companies, agreed with the substance of Verizon's concerns.

According to John Harrington, the CEO of Funds for Learning, an Edmond, Okla.-based organization that consults districts on the E-Rate, the debate ultimately comes back to the much larger issue of the size of the federal program. 

"There's no one I know that is against [increasing] students' access off campus, and generally speaking, most everyone understands that it's not acceptable that some kids have to go to McDonalds to get their Wi-Fi," Harrington said.

"The debate really centers around this idea that the E-rate program is currently oversubscribed, that demand is twice the available fund and that's growing. So under the current priority rule, how in the world can you expand the program when there's not enough money in the pool already?"

Funds for Learning's proposal would shift the way funds are allocated in the hopes of providing more flexibility for school districts and double the E-rate's available funding. The current E-rate model assigns requests for funding as Priority 1 and 2, but skyrocketing demand for the former currently uses up all of the E-rate's budget, leaving requests for the latter unfilled. Harrington's organization and others want to lift priority caps and instead cap funding per district based on their needs and give schools greater control over how to use the money, including for off-campus use. 

There are a handful of public and private programs that already work to provide low-income families with home broadband access. Those efforts fuel concerns by groups such as USTelecom about the need to use E-rate funding to address those needs.

The FCC's Connect America Fund works to provide broadband access to 18 million Americans in rural areas that lack the infrastructure to obtain services. The Connect-to-Compete partnership between the FCC and private companies provides home broadband for $9.95 a month for most households with one child eligible for the National School Lunch Program.

Comcast's Internet Essentials program, which predated Connect-to-Compete, has connected over 1,000,000 people to the internet with the same qualifications since the program began in 2011.

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