Final tally for Year Three eRate discounts, barring appeals: $2.085 billion.

Amount of time some schools had to wait for notification of their funding: nearly eight months.

On Dec. 1, the Schools and Libraries Division (SLD) of the Universal Service Administrative Co.—the group that administers the eRate—announced the 29th and final wave of funding commitment letters for the program’s third year, bringing to a close a notification process that began May 12.

The news came as schools across the country were preparing to submit their Year Four applications before the filing window closes Jan. 18. Though the SLD will accept applications after this date, it’s unlikely that late applications will be funded, as applications received after the filing window closes will be processed on a first-come, first-served basis.

The eRate provides discounts to schools and libraries on the cost of their telecommunications services, internet access, and internal connections (the wiring, routers, switches, and other equipment necessary to deliver internet access to classrooms). Year Three of the program pertains to services rendered from July 1, 2000, through June 30, 2001; Year Four applies to services delivered from July 1, 2001, through June 30, 2002.

For schools among the final group to be notified of their third-year funding, planning for Year Four has been an added challenge.

“I’d say that … late notification does put those schools at a disadvantage,” agreed SLD spokesman Mel Blackwell. “But, theoretically, the sooner we get [a school’s] application, the sooner it gets processed. Not knowing ahead of time [whether a school has received funding in Year Three] is difficult, but schools can still certainly apply for the next year while their current application is being considered.”

SLD officials attribute the lengthy notification process to the unprecedented volume of applications the agency received last year—some 36,000 total, up from about 32,000 the previous year.

“We always hope to get the commitment letters out as quickly as possible, but we get such a high volume of responses, and we have to take the time to make sure they all get processed correctly,” SLD spokesman Mel Blackwell said. “We’d certainly like to get things done more quickly. There’s no doubt that is our objective. But, unfortunately, somebody has to come in the last wave.”

The volume of applications for third-year eRate discounts meant that funding for internal connections did not even reach the 81-percent discount level, Blackwell said.

Under the program’s rules of priority, requests for telecommunications services and internet access (called Priority One services) are given top priority. If funds are still available after all Priority One requests have been granted, the SLD then funds requests for internal connections (Priority Two services), beginning with the most disadvantaged applicants and continuing down the discount scale until funding runs out.

The news isn’t all bad. The $2.085 billion committed in Year Three is almost $81 million more than was funded in Year Two, and it brings the total commitment for eRate funding to $5.845 billion in the program’s first three years combined.

The eRate has an annual cap of up to $2.25 billion. Discounts range from 20 to 90 percent, based on the number of students eligible for free or reduced-price lunches and an applicant’s rural or urban status.

In the program’s third year, nearly 71 percent of the funds ($1.474 billion) went to the neediest schools and libraries—those in which 50 percent or more of the children in the community qualify for free or reduced-price lunches.

Some of the $165 million difference between the program’s annual cap and the amount committed in Year Three was held to pay for successful appeals, Blackwell explained; the rest pays for the program’s administrative costs.

Year Four applications

The application process for Year Four of the eRate is going according to schedule, Blackwell said, though he added that it was too soon to tell if the response to Year Four will be as heavy as that of Year Three.

“Most of the applications come in [closer to the deadline],” he said. “Last year, 78 percent of our applications came in the last week.”

The biggest difference this year is that applications only have to be postmarked on or before January 18, the date the filing window closes. In the past, applications had to be in the hands of SLD representatives in Kansas by the appointed date, leaving little room for shipping problems and unforeseen mail issues.

“I think this decision [to accept January 18 postmarks] is the fair thing to do,” said Greg Weisiger, who helps schools fill out their eRate applications for the Virginia Department of Education.

Other changes include a slightly modified Form 471 and improvements designed to make filing online easier, Blackwell said. “Last year, 78 percent of applications were [filed] online,” he said. “We’re pushing for 90 percent this year.”

Blackwell said the SLD has taken additional steps to speed up the notification process for Year Four funding.

“For Year Four, we have made it so that we’re able to start processing applications as they come in the door, rather than waiting until we have a group of applications,” he said. “Our staffing will also be a little better—we’ve added a staff position at a critical data entry spot. We also have some systems improvements that will increase productivity … [and] the [Federal Communications Commission] has hired five more people to give us a quick decision turnaround.

“As we move forward, we hope to see a lot of things that will help us review applications at a quicker pace,” Blackwell said.

Schools and Libraries Division