The FCC has denied a petition by the state of Iowa asking that the Iowa Communications Network (ICN), which offers subsidized telecommunications services to the state's schools and libraries, be eligible for direct universal service support under the eRate program. The ruling, which was issued Feb. 18, reaffirms the agency's position that federal eRate funds cannot be used to support state education networks.

As a state-subsidized network, ICN provides schools and other beneficiaries with telecommunications services at steep discounts. For example, ICN charges schools and libraries $5 per hour for video rates that normally cost...

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