Universal Service reform: What it means for schools


The FCC already has significantly increased e-Rate funding. Based on inflation, it has increased the e-Rate funding cap for Funding Year 2012 to a record $2.29 billion, an increase of $40 million. In addition, it has authorized the Universal Service Administrative Co. (USAC) to carry forward $850 million in unused e-Rate support to fund FY 2011 requests and to fund all eligible Priority Two funding requests at all discount levels for FY 2010.

More changes are on the way. The State e-Rate Coordinators Alliance (SECA) recently filed proposals to (1) improve invoice processing, (2) lower the maximum discount for Priority Two services, (3) reform and unify e-Rate filing processes in a paperless, electronic format, (4) create a comprehensive requirements manual that would incorporate all of the disparate sources of policy and procedural guidance that is now spread among reference materials, training presentations, SLD news briefs, FAQs, and other sources, and (5) further streamline and update the Form 470.

This filing builds on SECA’s earlier recommendations that the FCC accelerate USAC’s decision-making process and eliminate funding “black holes” by increasing the transparency of USAC’s operations, adopting an e-Rate “Bill of Rights” for applicants and service providers, and making other changes to increase the quality, speed, and finality of USAC decisions. The FCC might seek comment on one or both of these proposals soon.

In addition, on July 11, the FCC adopted new reporting requirements for the 20 recipients of its “Learning on the Go” wireless pilot program, also known as the “e-Rate Deployed Ubiquitously 2011 Pilot Program.” The FCC chose these recipients in March 2011 to deploy projects designed to investigate the merits and challenges of using e-Rate funding to support mobile learning devices, such as smart phones, netbooks, or laptop computers, with wireless internet connectivity outside of school premises.

Through a series of questions addressing project benefits, costs, and the efficacy of legal compliance measures, the FCC will gather data to inform its judgments as to the value of the program. Reports are due to the agency Feb. 24, 2012, and Oct. 31, 2012, perhaps opening the door to broader availability of support for these services as early as Funding Year 2013.

Rural Health Care Service

The FCC’s Rural Health Care Universal Service Support Mechanism has struggled, almost since its inception, to fulfill its promise. The FCC is now working to implement changes that would implement the recommendations in the National Broadband Plan to expand the use of broadband service to improve the quality and delivery of health care.

New programs might, in some ways, help rejuvenate and augment the FCC’s efforts. The Department of Health and Human Services has teamed up with USDA to offer Health Information Technology (HIT) loans, designed to help rural health care providers purchase software and hardware needed to implement health care IT. These loans will be available starting in 2012.

In addition, USDA recently has announced nearly $300 million in grants and loans to support rural broadband facilities and services, in each case citing potential benefits to health care providers, as well as schools, libraries, and other community anchor institutions. On Aug. 2, USDA announced $192 million in loans in eight states supported by the Telecommunications Infrastructure Loan Program (part of $690 million committed during Fiscal Year 2011). Shortly thereafter, on Aug. 22, USDA announced $103 million in grants to expand broadband access across rural areas in 16 states under the RUS Community Connect Program.

Nonduplication of Federal Funding: What You Need to Know

As the FCC works to transform its Universal Service Support Mechanisms for a broadband world, these new broadband programs are likely to create new risks of duplication or overlaps in federal funding. Schools, libraries, and service providers alike will need to understand the intersection of e-Rate rules with those governing other support mechanisms, and maintain detailed records to document compliance with these rules. Failure to do so will create unnecessary exposure during audits and other compliance reviews, potentially endangering funding.

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