Feb. 1996 Telecommunications Act of 1996 is signed into law, extending universal service discounts to schools and libraries

May 7, 1997 After months of study, FCC releases eRate guidelines outlining how the program will be implemented

Nov. 1, 1997 FCC establishes the Schools and Libraries Corp. (SLC) to administer the eRate; Ira Fishman selected as chief executive officer

Dec. 4, 1997 Sen. John McCain, R-Ariz., sends a letter to FCC chair William Kennard expressing concern that residential rates will increase as a result of the eRate

Dec. 15, 1997 Under pressure from McCain and other conservative members of Congress, Kennard announces cutbacks in eRate funding—$625 million is to be collected through the first half of 1998

Jan. 1, 1998 FCC begins collecting eRate subsidies from telecommunications carriers on schedule, despite opposition from McCain and Rep. Thomas Bliley, R-Va.

Jan. 30, 1998 eRate application window opens; SLC receives 10,000 applications within the first week

Feb. 11, 1998 Prompted by Sen. Ted Stevens, R-Alaska, General Accounting Office (GAO) issues a report ruling that FCC exceeded its legal authority in establishing the SLC

Mar. 31, 1998 Senate passes appropriations bill requiring FCC to revamp its universal service programs

Apr. 15, 1998 75-day eRate application window closes; over 30,000 applications are received within the filing window

May 8, 1998 In response to Senate appropriations bill, FCC’s report to Congress proposes: (1) scaling back funding to a total of $1.67 billion this year; (2) folding SLC and Rural Health Care Corp. into Universal Service Administration Corp.

May 13, 1998 FCC issues public notice seeking comment on eRate funding

May 21, 1998 A coalition of consumer groups, led by the Consumers Union and Consumer Federation of America, urges the FCC to halt the program until long-distance rates are reduced

May 28, 1998 AT&T announces it will impose a 5 percent surcharge on its residential customers’ bills starting July 1; within days, MCI announces a 5.9 percent surcharge effective July 1 as well

June 4, 1998 Sen. Ernest Hollings, D-S.C., Rep. John Dingell, D-Mich., Sen. McCain, and Rep. Bliley send a letter to Kennard demanding that the FCC suspend further collection of eRate subsidies until Congress’s concerns about the program are addressed

June 10, 1998 Testifying before the Senate Communications subcommittee, Kennard vows to “proceed with prudence” on the eRate

June 12, 1998 FCC commissioners vote 3-2 in favor of scaling the program back even further, but continuing with it nonetheless; only $1.3 billion will be collected to fund the eRate in 1998