Tag Archives: E-Rate

Killing Hot Spots for Students

Senate Majority Leader John Thune says he hopes to bring a resolution to the Senate to repeal the funding of Internet hot spots from the E-Rate Program, which is part of the FCC’s Universal Service Fund.

The original support for funding hot spots came from a July 2024 vote of the FCC under Jessica Rosenworcel to allow the E-Rate program to pay for hot spots. For those not familiar with E-Rate, the program is used to subsidize broadband connections in schools that qualify by having a high percentage of students participating in the federal school lunch program.

The FCC’s approved plan meant that poorer school districts could fund hot spots for students and get reimbursed through the E-Rate program. The bill also allowed for other uses of hot spots, such as installing them on rural school buses.

USAC opened an application window for the hot spot program and was inundated with applications. There has been 605 applications from school districts representing 15,624 schools, asking for 714,119 hot spots. Library systems submitted 330 applications to support 2,250 libraries, asking for 96,583 hot spots.

The Congressional Review Act resolution that asks to kill the hot spot plan was sponsored by Senator Ted Cruz and other Senators. The backers of the bill claim that E-Rate was intended to help schools with broadband and should not be extended outside the school. Senator Cruz also claimed that giving hot spots to school children opened them to risks of abuse by allowing unsupervised students to go to the open Internet. This bill seems to be part of a larger effort to ban children from social media, which likely will come for a vote sometime this year.

It’s been my experience that the chance of harm to children is unlikely. Numerous school districts already provide laptops or tablets to students, and many students take them home to do homework. Every school district I’ve ever talked to uses strict filtering to make sure that computers are not used for anything other than doing homework. The computers typically are configured to only connect to the school network and nowhere else. Most school systems have those networks locked down to block open access to the Internet, and students can only see the same materials at home they see when in school. Many schools already issue hot spots and are taking the same precautions.

This bill raises a lot of questions. Might this eventually lead to forbidding the deployment of hot spots from other federal funding sources? A huge number of libraries lend hot spots to the public, and it seems likely that some of those programs get some federal funding. Librarians in rural counties universally tell me that hot spot lending is one of their most demanded services. Might this prohibition be the first step in not allowing students to take home computers?

Like other bills and initiatives currently aimed at the Universal Service Fund, this effort might soon be moot since there is a pending case at the Supreme Court, with oral arguments scheduled on March 26, that asks if the USF is constitutional. The case asks if the FCC has the authority to establish the USF and if it can assign the administration of the fund to USAC. If the Court rules that the USF is unconstitutional, then the fund will likely go immediately dead unless Congress steps in to immediately save it.

Benefits of the Universal Service Fund

The FCC recently released a short document that highlights the benefits that come from the Universal Service Fund. I have to imagine they published this in response to the Universal Service Fund being under fire by the courts and other critics. The biggest current controversy is how the USF is funded, which is mostly on the backs of telephone and cellular customers.

The U.S. Court of Appeals for the Fifth Circuit in New Orleans recently ruled, in a 9-7 vote, that the FCC’s Universal Service Fund structure is unconstitutional. If that case holds up through an appeal to the Supreme Court, the entire fund could be ended. That would force action by Congress to redefine the USF rules to keep the fund operating.

The FCC touts the following benefits from the Universal Service Fund:

E-Rate Program

This program provides subsidized broadband connectivity to schools and libraries. From 2022 to 2024, 106,000 schools and 12,597 libraries received over $7 billion in benefits to reduce the cost of broadband connectivity and internal connections. This benefitted over 54 million students.

Rural Health Care Program

This program provides discounted connections for rural nonprofit healthcare providers. From 2021 to 2023, this fund provided over $1.6 billion to benefit 16,080 health care providers with connectivity costs.

The fund also provided over $98 million in the Connected Care Pilot Program to support 107 projects that are exploring creative ways to provide telehealth services.

Lifeline Program)

As of March 2024, over 7.5 million low-income households were receiving the $9.25 monthly discount for phone and/or broadband service.

High-Cost Program

In 2023, carriers nationwide received over $4.2 billion to build infrastructure to bring better broadband to rural communities.

There are critics of some of these programs. There have been claims over the years of fraud in the Lifeline program. That may still be true to some degree, but the FCC created a fairly effective portal used to qualify Lifeline recipients that should have greatly tamped down the opportunity for fraud.

There are many who think the high-cost programs pay out too much money to rural telcos. In the past, much of this money was a simple subsidy, but more recently these funds are aimed more directly at funding rural infrastructure.

I’ve heard industry folks complain that the E-Rate Program mechanism encourages ISPs to charge higher rates for school broadband since those rates are mostly paid by the USF.

The FCC and Urban Broadband

Chairman Ajit Pai recently said during an interview in Buffalo that he supported what he called Gigabit Opportunity Zones as a way to get fiber built to poor neighborhoods in downtown areas of cities like Buffalo.

The idea of Gigabit Opportunity Zones comes from a bill that was introduced in the last Congress in November of 2019 by Georgia Representative Doug Collins. The bill is H.R. 5082 – the Gigabit Opportunity Act.

The bill would mimic many of the provisions of the Opportunity Zones that were created in the Tax Cuts ad Jobs Act of 2017. That law intended to spur infrastructure investment in low-income Census blocks. The original tax change allowed investors to gain two major tax benefits from investing in qualified infrastructure. They could defer or erase existing capital gains by investing capital gain profits into qualified projects for at least ten years. Investors would also see no capital gains from profits made on an opportunity zone investment.

The proposed broadband bill has similar, but different benefits. First, governors would have to

nominate areas in their state that would be eligible for the gigabit tax breaks. Such areas would have to

  • Face obstacles to economic development due to a lack of geographic broadband coverage or speed;
  • Are the focus of mutually reinforcing state, local, or private economic development initiatives;
  • Are poised for economic growth that requires access to high speed broadband for commercial purposes; and
  • Represent the areas of a state where such service would result in the highest return on investment.

Just like with the existing opportunity zone rules, an investor could defer or eliminate existing capital gains by bringing capital gains proceeds to a new qualified project. Even better than the existing opportunity zones investing, the new project could expense the cost of building the fiber network in the first year, thus realizing a huge capital loss in the first year (which is a great way to wipe out capital gains).

It doesn’t look like the bill has moved forward since introduction beyond being referred to the Subcommittee on Communications and Technology. The purpose of the blog is not to say anything negative about the bill. It would be great if something like this would help spur building fiber to urban neighborhoods that might otherwise never see fiber. It does seem to me that the provisions that a qualified investment must result in the highest return on investment makes it likely that this would benefit the richest neighborhoods rather than the poorest. But those kinds of details get worked out during the legislative process.

What I found a bit disturbing is that this bill was brought up in response to the question of what the FCC could do for cities like Buffalo. The Chairman offered the following responses to the question:

  • He said the FCC had expanded the opportunity for people to qualify for the Lifeline program. From what I can see, this FCC has done the exact opposite and would like nothing better than to eliminate this part of the Universal Service Fund.
  • He mentioned E-Rate programs to bring better broadband to schools and libraries. The FCC did make it a bit easier for schools to turn that broadband outward to the parking lots during the pandemic, but otherwise this FCC hasn’t improved the E-Rate program.
  • Chairman Pai said he had asked Congress for the authority to provide hotspots to poor urban neighborhoods, but that Congress hasn’t given him that authority. This highlights that the FCC gave away their authority over broadband and now has no authority to do things like promote hotspots.
  • He mentioned the RDOF grant process as one that is bringing broadband to those that need it, without mentioning that the ‘R’ in RDOF stands for rural – none of that money is going to Buffalo.
  • He mentioned regulatory reform. By that, he is sticking with his story that deregulating the big ISPs will result in more investment in places like Buffalo. From what I can see, none of the big ISPs have responded to ‘light-touch’ regulation by building fiber to poor neighborhoods.
  • Finally, he cited the Gigabit Opportunity Zone legislation. That’s a stalled piece of legislation that might bring benefits, but which has nothing to do with the FCC.

The Chairman’s response should have been that the FCC is not seriously looking at solving the digital divides in cities. The FCC has done its best to write itself out of the broadband picture. The FCC still must administer the Universal Service Fund because it has no choice. The FCC Chairman is sticking to the pure fiction that the big ISPs will solve the broadband problems of the world in response to being deregulated. But in reality, the FCC is doing almost nothing for urban broadband and has no intentions of doing so.

GAO Supports Broadband to Students

In an interesting move, the General Accounting Office released a paper that suggests that the FCC should expand the use of E-Rate funding to allow wireless connections to student homes. The E-Rate program is one of the major components of the Universal Service Fund. Today the E-Rate program can be used to construct fiber assets to reach schools or to subsidize fast broadband connections to schools that demonstrate the financial need.

Specifically, the GAO “recommended that the FCC assess and report on the potential benefits, costs, and challenges of making wireless access off school grounds eligible for E-rate.” The GAO recommendation went on to discuss the impact of the homework gap that puts students without home broadband at risk for falling behind their peers.

I’m sure that every rural broadband advocate understands this issue and applauds the GAO for making this suggestion. However, this seems extraordinary coming from the GAO and seems outside of their stated scope and function. The GAO is the internal auditor of the US government and is often called the congressional watchdog agency that examines how taxpayer dollars are spent. The GAO routinely provides reports to Congress with ideas on how the government can save money and work more efficiently.

I may have missed it, but I can’t remember the agency ever making policy suggestions of this magnitude to the FCC in the past. This seems like a particularly puzzling recommendation because it’s a suggestion on how to spend existing E-Rate money in a different way rather than suggesting ways for the FCC to save money.

The GAO report does a great job of describing the homework gap. The report discusses challenges that school-age children face in doing homework without a computer. The GAO found that many homes without home broadband rely on cellular connectivity, which is largely inadequate for doing homework. The report points out the shortcoming and challenges on the following chart for the alternatives to home broadband such as libraries, community centers, coffee shops, and outdoor WiFi around schools.

The GAO looked into six pilot projects at schools that tried to alleviate the homework gap using wireless technology to connect to students. The GAO pointed out that in 2016 that two schools asked for FCC waivers in the E-Rate program to provide wireless connectivity to students, but the FCC never reacted to the waiver requests.

The GAO concludes the report by recommending that the FCC take steps to assess and publish the potential benefits, costs, and challenges of making off-premises wireless access eligible for E-rate support. The has already FCC agreed with GAO’s recommendation, so I’m sure there will be an assessment coming in the near-future.

Regulatory Shorts for September 2016

Wi-FiToday’s blog contains a few items that are cautionary tales of things not to do.

FCC Funding for Broadband. The FCC recently rejected three petitions for reconsideration filed by companies that had been awarded the experimental broadband grants last year, but then failed to meet the grant criteria. Two of the companies were start-ups and did not have audited financial statements. Another had an audit but filed it after the grant-specified deadline. The FCC refused to give the three companies the grants since they didn’t meet all of the requirements.

The cautionary tale here is that anybody filing for a grant should make certain ahead of time that they meet all of the requirements. There were a lot of applicants who received broadband grants out of the stimulus funding a few years ago that did not qualify, but for whom the government accepted waivers. However, that was an extraordinary circumstance due to the huge size of the grants and the desire of the government to use the funding. In more normal circumstances it’s exceedingly hard to get a waiver for a company that doesn’t meet all of the qualifications.

Fines for Unauthorized Wireless Connections. The FCC recently fined AT&T $450,000 for using licensed wireless connections that were made without FCC authorization or that had not been properly licensed. These were mostly fixed microwave connections, something that is relatively easy to get licensed.

The cautionary tale is to be sure to take care of the paperwork when deploying wireless systems. It’s becoming fairly routine for companies to deploy microwaves to provide wireless backhaul for point-to-multipoint wireless networks or for serving cellular sites. There are also now licensing requirements for anybody deploying subscriber radios that use the 3.65 GHz spectrum. Failure to obtain the microwave licenses could end up with fines like AT&T just paid. But since there are places in the country where it’s not legal to deploy the 3.65 GHz radios, failure to clear it first with the FCC could even end up in having your systems shut down.

Blocking WiFi. FCC Commissioner Jessica Rosenworcel has asked the agency to investigate a seeming restriction of WiFi for those attending the first presidential debate. Apparently, Hofstra University had blocked people from establishing WiFi hotspots from their cellphones and instead wanted journalists to buy a $200 connection for the evening. The FCC in the past has come down hard on this kind of blocking against Marriott hotels and others. The FCC has levied large fines in almost every such case brought to their attention.

The cautionary tale here is not to block WiFi. Companies and cities are often tempted to do this as a security measure and the technology to block WiFi is readily available. But WiFi is a public spectrum and it’s always against the law to block somebody from establishing their own hotspot.

Using E-Rate Broadband Off-Campus. Two school districts have petitioned the FCC to allow them to extend broadband that is subsidized by the E-Rate program to students and others living close to the campus. Under current rules, if an E-Rate network is used for applications other than the school, then the cost of the system has to be allocated between the school and other uses. These petitions ask that the FCC allow them to use the school broadband to serve students and other parties that can benefit from the broadband, without having to allocate the costs.

There is both a caution here as well as an opportunity. The caution is to beware if an E-Rate broadband connection is used by more than the school. For example, it’s not unusual (particularly with private schools) to have other organizations or entities collocated with the school. In such a case the E-Rate applicant needs to make sure to allocate the costs between the school and the other entities. Failure to do so could end up with a loss of the E-Rate subsidy. But the opportunity also exists with wireless networks to provide home broadband to students who live close to the school. If these petitions are successful it could open up many possibilities for schools to benefit nearby residents.

Libraries in the Digital Age

LibraryToday’s blog was inspired by reading Libraries: Broadband Leaders of the 21st Century by Craig Settles, a well-known broadband advocate. As someone who hasn’t been to a library for many years his paper surprised me with the number of different ways that libraries are engaged in broadband today.

Probably the best known role of libraries is as a source of broadband for those who don’t have access anywhere else. Libraries today offer broadband at computers as well as WiFi for patrons to use on their own devices. A recent FCC report noted that in most cities anywhere from 15% to 25% of citizens don’t have broadband at home, and for many of them the library is a place they can get access to the web.  This access lets kids do homework, provides job training for those looking to change careers and gives access to government web sites that are increasingly moving input to social systems on-line.

But many libraries go a lot farther. For instance, there are libraries today that are lending mobile hot spots to enable people to have internet access outside the library for a few hours at a time. Many libraries are at the center of efforts to improve digital literacy and they have programs to train people in computer skills and to help them accomplish needed tasks on the web. Many library systems also have training programs in advanced computer skills like coding.

Libraries everywhere want larger faster broadband connections. In many communities the libraries get the same speeds of broadband that are available at homes. And while having a 100 Mbps connection sounds fast, when that much bandwidth is divvied up among a hundred patrons it slows to a crawl. And sadly, there are still a lot of libraries across the country that are served by only T1s or slow DSL connections.

The White House announced a goal in 2013 in the ConnectED initiative to get at least 100 Mbps connection to schools and libraries within five years, with the ultimate goal being gigabit bandwidth. And there has been a lot of progress, but the most recent FCC Broadband Progress Report says that 41% of schools and libraries still don’t have 100 Mbps connections.

Libraries can get assistance to build broadband facilities using the Schools and Libraries portion of the Universal Service Fund, and which is generally referred to as the E-rate program. This fund can be used to subsidize the monthly broadband bills, but can also be used for physical parts of the network like fiber to connect library branches or WiFi systems within a library.

Some communities have been able to really leverage E-rate funding by tying their schools and libraries together into an integrated network and by using libraries to meet educational goals of the schools. It’s generally easier to get funding for schools compared to libraries, but by networking them together you can bring some of that funding in to help improve the libraries and to make them an integral part of the education complex. This leverage can be expanded to be even stronger by linking networks to hospitals and leveraging funding available to improve broadband for healthcare.

Settles makes a case for allowing libraries to participate in the upcoming Lifeline program that will provide $10 monthly subsidies for broadband for qualifying low-income homes. Since libraries are the source of broadband for many low-income people an argument can be made that spending that subsidy at a library can benefit more people than spending it at one home. It’s an interesting concept and would take action by the FCC or USAC, the entity that administers the Universal Service Fund.

Since most cities are still far away from a time when there will be affordable broadband available to everybody, the libraries are likely to continue to be an important part of the broadband solution for most communities. It’s important for library administrators to understand the options available to them to maximize the funding they can get to provide public broadband. Papers like the one written by Settles are an important step in that process.

Changes to the E-rate Program

Indianola_High_SchoolThe FCC recently revised the rules for the E-Rate program which provides subsidies for communications needs at schools and libraries. They made a lot of changes to the program and the rules for filing this year are significantly different than what you might have done in the past. I’ve made a list below of the changes that will most affect carriers and you should become familiar with the revised rules if you participate in the program. Here are some of the key changes to the program from a carrier perspective:

  • Extra Funding. There is an additional $1 billion per year set aside for the next two years for what the FCC has called Internal Connections. This means money to bring high-speed Internet from the wiring closet to the rest of the school. This might be new wiring, WiFi or other technologies that distribute high-speed Internet within a school.
  • Last Mile Connections. It’s also possible to get funding for what they call WAN / Last-Mile connectivity. This would be fiber built to connect a school to a larger network such as one for a whole school district.
  • Stressing High-Speed Connections. The target set by the FCC is that a school should have at least 100 Mbps per 1,000 students and staff in the short run and 1 Gbps access in the long run. It is going to be harder to fund older slower connections even for very few poor schools. As a carrier you need to be planning on how to get connections that meet these requirements to schools if you want to maintain E-rate funding.
  • Things No Longer Funded. One of the ways the FCC will fund the expanded emphasis on higher bandwidth is by not funding other items. The fund is going to focus entirely for the next few years on funding things that promote high-speed connections, so they will no longer fund “Circuit Cards/Components; Interfaces, Gateways, Antennas; Servers; Software; Storage Devices; Telephone Components, Video Components, as well as voice over IP or video over IP components, and the components, such as virtual private networks, that are listed under Data Protection other than firewalls and uninterruptible power supply/battery backup. The FCC will also eliminate E-rate support for e-mail, web hosting, and voicemail beginning in funding year 2015”.
  • Combining Schools and Libraries. For the first time it will be possible to combine the funding for a school and library that are served by the same connection / network.
  • Eliminating Competitive Bidding for Low-Price Bandwidth. A school does not need to go to competitive bid if they can find a connection of at least 100 Mbps that costs $3,600 per year (or $300 per month) or less.
  • Eliminating a Technology Plan. There is no Technology Plan now required for applying for Internal Connections (in-school wiring) or for providing WAN connections.
  • Simplifying Multi-Year Contracts. Subsequent years after the first year of a multi-year contract will require less paperwork and have a streamlined filing process.
  • Simplifying the Discount Calculation. The discount can now be calculated on a per school-district basis and not per school within the district. The FCC adopts the definition from the Census that defines urban areas to be the densely settled core of census tracts or blocks that met minimum population density requirements (50,000 people or more), along with adjacent territories of at least 2,5000 people that link to the densely settled core. “Rural” encompasses all population, housing, and territory not included within an urban area. Any school district or library system that has a majority of schools or libraries in a rural area that meets the statutory definition of eligibility for E-rate support will qualify for the additional rural discount.
  • Requiring Electronic Filings. All filings will need to be electronic, phased in by 2017.

These are a lot of changes to a fairly complex filing process. CCG can help you navigate through these changes. If you have questions or need assistance please contact Terri Firestein of CCG at tfireccg@myactv.net.

Funding Broadband to Schools

Indianola_High_SchoolFCC Chairman Tom Wheeler recently announced that he was going to try to funnel $5 billion over the next five years to upgrade the bandwidth inside schools. He is proposing to do this as part of the E-Rate program by changing the things that fund will pay for. I think this begs the question of how and why the FCC has the funds available to pay for this sort of expenditure. So following is a bit of a primer on the E-Rate program.

The E-Rate program is part of the federal Universal Service Fund (USF). Since the 1960’s there was a universal service fund that was administered by AT&T that provided funds to support the expansion of telephony into rural places. This was funded by a small surcharge on interstate long distance calls.

But when AT&T was broken up the funding for USF got murky and so Congress changed the administrator of this funding as part of the Telecommunications Act of 1996. In the Act the Congress directed the Congress to create the Universal Service Administrative Company (USAC) who collects and disburses funding for universal service. USAC is still funded based upon interstate telecommunications. Most telcos pass these fees along to customers on their bills, although this is not mandatory and companies could fund this out of their fees.

The Universal Service Fund has four major components. The High Cost Fund pays to support providing telephony in rural places where the costs are much higher per customer than average. The Low Income Fund pays for some of the installation fees and also some of the monthly fees for telephone lines for low income subscribers. The Rural Health Care Fund provides subsidies for rural tele-health and tele-medicine. And the Schools and Library Funds provides subsidies for Internet access and telecommunications services and infrastructure for schools and libraries.

The USF is undergoing major change due changes ordered by the FCC in Docket 11-171 in 2011. The fund is being transitioned to be called the Connect America Fund and will divert the High Cost Fund to be used to support rural broadband instead of rural telephony.

The Schools and Libraries Fund is commonly referred to as the E-Rate program. This program was started in 1997 where the FCC determined that, “telecommunications services, Internet access, and internal connections, including installation and maintenance,” for schools and libraries were eligible for discounted rates. The E-Rate program will pay from 20% to 90% of the cost of eligible services based upon the poverty and the urban/rural nature of the population supported by a given school. The Fund pays the neediest schools and works its way through the list of applicants each year until it runs out of funding.

What the FCC is doing as part of Chairman Wheeler’s announcement is to look at the definition of what is eligible for reimbursement from the E-Rate program. These definitions haven’t been upgraded for a long time and the fund pays for things like pagers and telephone lines (although one has to imagine the payments for pagers must be very tiny).

The FCC now wants to divert some of the fund to help pay for the basic infrastructure at schools to deliver broadband to the classrooms. President Obama has announced a policy goal, referred to as ConnectED, of bringing faster broadband to all of the schools in the country. His goal set a near-term goal of bringing 100 Mbps connections with a near-future goal of bringing gigabit speeds to schools

The FCC is responding to those policy goals with this change in the E-Rate funding. In Docket WC 13-184 the FCC had looked at some of these issues and had noted that there was a challenge in getting bandwidth from the wiring closet of schools into the classrooms. The FCC now wants some of the E-Rate funds to be used to rewire schools or to deploy other technologies that can bring bandwidth to where students can use it. It certainly is important for this fund to keep up with the times. It makes a lot more sense to use these funds to improve bandwidth at schools rather than to continue to pay for telephone service and for T1 lines. .

Faster Internet for Schools and Libraries

On July 23 the FCC released a Notice of Proposed Rulemaking in WC Docket No 13-184 that asks questions about modernizing the E-rate program for schools and libraries. The E-rate program has been around for a few decades and has been used to bring broadband to schools and libraries.

But last month President Obama announced a ConnectED initiative that has the stated goal of bringing a minimum of 100 Mbps and a goal of 1 Gbps to 99% of students within five years. This NPRM is in response to that initiative.

A 2010 FCC survey showed that only 10% of schools had speeds of 100 Mbps or greater. 48% of schools had speeds less 10 Mbps. 39% of schools reported cost as the barrier to better speeds while 27% cited the cost of installation as a barrier. And the situation is worse in our libraries. In a 2011 survey by the American Library Association only 9% of libraries have speeds of 100 Mbps or faster while 25% still have speeds of 1.5 Mbps or less.

There is clearly a need for revised E-rate funding. In the most recent year there were requests for funding from schools of over $4.9 B from a fund that is at an annual cap of $2.25 B. The E-rate program is funded today as part of the Universal Service Fund that gets fund by a surcharge put on a wide variety of telecommunications end-user bills.

The FCC has laid forth new goals for the E-rate program and also suggested a number of specific changes. The new goals include 1) That schools and libraries have affordable access to broadband in order to meet the goals of ConnectED; 2) that the effectiveness of the E-rate funding is maximized, and 3) that the administration of the program is streamlined.

The FCC seeks comments on the specific speed requirements needed for schools and libraries. They offer the target established by the State Education Technology Directors Association (SETDA) which suggests that K-12 schools should have at least 100 Mbps per 1,000 students by 2015 and 1 Gbps for every 1,000 students by 2018. For libraries they offer the State Library of Kansas recommendation that all libraries should have 1 Gbps connectivity by 2020.

One of the issues that the NPRM looks at is how to get the bandwidth around the school once it’s delivered to the side of a school. This is a significant issue because today’s wiring technologies and wireless technologies have a steep drop-off in data speeds over even short distances. So the NPRM looks for comments on how to best get the bandwidth to classrooms.  The State E-Rate Coordinators Association (SECA) has suggested that this issue is of high enough importance that it ought to be at the top of the priority list for E-rate funding.

The NPRM asks questions about increasing the efficiencies of buying broadband. This includes consortium purchasing and other bulk buying opportunities. The larger school districts are able to negotiate better rates today than small school districts due to the fact that they serve a significant number of schools. There must be ways for neighboring districts to band together for efficiency (although local politics is often a barrier to this process).

The NPRM also asks what the funding should be used for. It suggests that funding be transitioned to support only broadband. The funding is currently used for a number of other purposes which were allowable under the old rules.  For example, in the most recent funding year there were requests for $260 M to subsidize telephone lines.

Finally, the NPRM looks at who is eligible for the E-rate program. Today the program pays for some portion of eligible costs based upon the percentage of student enrollment that is eligible for a free or reduced price lunch in a given school. The school gets a discount based upon that factor and must then match between 10% and 80% of the cost. The NPRM looks at alternate eligibility requirements including (1) revising the discount matrix to increase certain applicants’ matching requirements; (2) providing support on a district-wide basis; (3) revising the approach to supporting rural schools and libraries; (4) incorporating a per-student or per-building cap on funding into the discount matrix; (5) providing more equitable access to priority two funding; and (6) allocating funds to all eligible schools and libraries up front.

Comments in the NPRM are due to the FCC by September 16, 2013. CCG Consulting will probably be making some comments in the Docket, so if you have anything you want to say let me know and it can be included in our filing.

Broadband and Schools

Satellite Internet dish attached to a...

English: Satellite Internet dish attached to a building in rural America (Photo credit: Wikipedia)

Earlier this month President Obama announced an initiative to get 1 Gbps or at least 100 Mbps broadband to 99% of schools within five years. The new plan is being referred to as ConnectEd and the citation takes you to a posting on the White House web site that outlines the program.

The program will have several components. The one that will be most familiar to the readers of this blog is that the program will provide improved connectivity through the E-Rate program that is part of the current Universal Service Fund. The E-Rate program for years has been providing subsidies to bring broadband to schools and libraries in the poorest communities. One has to imagine that the FCC is going to expand that program to include money to build fiber in rural communities. It’s not clear yet how it will work, but the administration has said that the NTIA (National Telecommunications and Information Administration) will take a lead in moving the program forward.

The second component of the plan will provide more training for teachers to be proficient in the technology that broadband will bring to the schools. This will be done with funding through Title II and Title VI programs through the Department of Education.

I don’t think there is anybody who can fault the goal of this plan which is to make sure that kids have access to broadband at school. Certainly students at schools that do not have broadband access will fall behind everyone else.

But for rural areas this is not enough. Over the last few years there has been a number of ‘middle-mile’ fiber networks built as part of the BTOP program using money from the 2009 Stimulus program that built rural fiber. The middle-mile projects built fiber through rural areas and also connect to ‘anchor institutions’ in those areas, meaning schools, universities, libraries and government buildings.

But in far too many cases those are the only places that got broadband out of the billions of dollars that were spent to build fiber. This is not a blanket indictment of the BTOP program because in some cases that fiber has been an incentive for carriers to build last mile fiber or wireless networks to serve rural customers. But I am also aware of many examples of BTOP fiber networks that bring fiber through a rural town, connect a school and a City Hall and nobody else.

And in many of those communities the existing broadband is poor or non-existent. It is very typical to have some sort of broadband in the towns in rural counties – generally DSL supplied by the phone company or cable modems supplied by a cable company. But in most cases the broadband in these towns is far slower than what is routinely available in big cities. But one generally only has to go a mile or two outside of these rural towns and the broadband stops. There are hundreds of counties that have this situation.

And in a lot of these areas without landline broadband there is also inadequate wireless broadband. Fiber is needed to provide broadband to cell towers if we want to use them to provide 3G or 4G data. Most rural cell towers were built along highways to serve cars and are not built where people live. And so in many rural areas there is no effective broadband.

And so it leads me to ask if there is not some way to help the communities around the schools while we bring broadband to the schools. 100 Mbps or 1 Gbps to a school is a great thing and I applaud this effort. But are we really helping rural students if once they leave school they don’t have enough broadband to do homework?

The original BTOP program that built fiber through rural communities did not go far enough. We need some way in this country to now build the rest of the fiber network and connect everybody. I would be a lot more excited about this announcement if it said that we were going to bring fiber to 99% of rural homes in five years.

I work with a lot of rural communities trying to get funding to build fiber and it is tough. These projects suffer from having a large infrastructure cost per household due to the sparse population in rural areas. These projects have a hard time getting funded through traditional funding sources like municipal bonds. If the federal government really wants to help rural areas get fiber they should be looking at ways that would help get rural fiber projects funded.

I don’t think it’s necessary for the federal government to step in and hand out the money to build rural fiber. That would probably just give us more BTOP programs and networks. But there are concrete steps the federal government could take that would make it easier to get this done. Rural communities are willing to pay for fiber themselves, but that desire is meaningless if nobody will lend them the money. So the best way to help rural America get broadband is to make it easier for rural communities to do it themselves. That is going to mean something like loan guarantees or lower interest rates for these projects.

The federal government already operates a ‘bank’ to provide rural broadband at the Rural Utility Service (RUS) that is part of the Department of Agriculture. But that money is so hard to obtain by rural governments that it might as well not exist. It would be easy to make the RUS into a functional program – it just takes the will to make it work.

In the last year we have had two big announcements at the federal level about broadband. One was to promote gigabit cities and now we will have broadband to 99% of schools. I am still waiting for the announcement that matters – to bring broadband to people.