How applicants would change the eRate, if they could

Many of the comments expressed a deep gratitude for the eRate, and overall, they indicated a desire for a simplified, more predictable program that can help them provide better internet connectivity.

In what could be described as a testament to the success of the eRate program, applicants requested the largest amount in the past decade for Funding Year 2012: more than $5.1 billion. While demand for eligible services is at a 10-year high, it is nearly double the available funding ($2.3 billion).

Sensing that demand for eRate funding would continue to outpace available funding nearly 2 to 1, last spring Funds For Learning set out to gather the perceptions, predictions, and opinions of eRate applicants through a nationwide survey. Over the course of two months, Funds For Learning received hundreds of responses from applicants, gathering insight on how applicants are using the program.

In total, 636 applicants responded to the survey, which represents about 3 percent of total applicants in the country. Of these respondents, 434 identified the school or district they represented, allowing for additional statistical comparisons of their response with eRate funding request data.

The online survey consisted of 10 questions designed to address the following themes: the importance of the eRate program; how funding predictability, speed, amount, and flexibility should be ranked; a summary of applicants’ current technology use and plans for the future; ideas for how the eRate should be changed in future funding years; and, in the face of rising demand, which currently funded services are considered most important. Here are excerpts from the full survey analysis.

Significance of the eRate

One survey question asked applicants to respond to a series of eight “agree or disagree” statements regarding the eRate’s importance, historical success, and future growth.

Fast facts

• Approximately 90 percent of respondents said the eRate is critical to their success.

• Only about 40 percent of applicants believe their current level of internet access is adequate for their needs.

• Only one-third of respondents believe the eRate is adequately funded.

There seems to be consensus that schools depend on eRate funding for telecommunications service and internet access in their classrooms, and that more eRate funding is needed. There is almost complete agreement that the eRate is critical to schools, and nearly all respondents believe that eTextbooks and “bring your own device” technology will increase future demand for eRate-eligible services.

Responses to this question generally were consistent, regardless of school size or eRate discount level. However, two of the eight statements did elicit significantly different responses: (1) Sixty-six percent of applicants receiving only Priority 1 (P1) funding agreed with the statement, “Our buildings are wired. Eliminate P2 and focus on P1.” However, only 33 percent of applicants who receive Priority 2 (P2) funding agreed. (2) By a similar but opposite margin, 59 percent of applicants receiving P2 funding indicated that they rely on basic maintenance support; whereas only 32 percent of P1-only applicants indicated a reliance on basic maintenance.

The results are clear: Applicants who currently receive P2 funding rely on it and would not choose to eliminate it. More surprising, perhaps, is that one-third of respondents who do not currently receive P2 funding still support it.

What matters most: the predictability, speed, amount, or flexibility of funding?

This question asked applicants to rank four aspects of eRate funding—predictability, speed, amount, and flexibility—from least to most important to their schools.

Fast facts

• The largest majority of respondents indicated that predictability of funds was most important, followed closely by the amount of funding.

• Flexibility in the use of funding was ranked least important by a significant margin.

Being able to rely on eRate funding is consistent with the need to plan projects, budget funds, and so on. School administrators are required to plan many aspects of their organization’s operation far in advance. Shrinking budgets mean that schools need as much funding from outside sources as possible, and the stability and predictability of those funding sources is critical to ensuring that schools can carry out their plans effectively.

Current and future technology use

This series of questions asked applicants to rank the readiness of their existing infrastructure, the importance of certain types of technology initiatives for the future, and what changes they anticipate for their budgets for P1 services five years from now.

Fast facts

• Fifty-eight percent of respondents said they felt their telecommunications and internet budgets will be up slightly or significantly in five years.

• One-third of respondents believe their current infrastructure is lagging, with only 10 percent indicating that their telephony, data, and WAN infrastructure is “ready for tomorrow.”

eRate funding requests for P1 services (telecommunications and internet access) have risen steadily over the past five years, from $1.8 billion in Funding Year 2008 to $2.4 billion in Funding Year 2012. Responses to the survey would suggest that applicants believe this trend will continue, with only 16 percent of respondents estimating that their budgets for P1 services will be lower than their current level five years from now.

Wireless LAN connectivity scored highly among choices for technology initiatives over the next three years, with 42 percent of respondents placing a high emphasis on wireless projects. And while a small percentage of applicants said their infrastructures are ready for the future, respondents were clear that continued support of telephony, data, and WAN infrastructure projects is critical for applicants’ future success.

How can the eRate improve?

Another series of questions asked applicants to share their opinions about potential changes to the eRate’s rules, regulations, and processes.

Fast facts

• Fifty-eight percent of respondents said increasing the amount of eRate funding is of critical importance.

• In lieu of an increase in funds, over half of respondents favored either establishing a P1 discount threshold or lowering discount rates if P1 demand exceeds available funding.

Nearly 60 percent of respondents said the FCC should focus on increasing the amount of funding available from the eRate. When asked about potential solutions for a scenario where P1 demand exceeds available funding, majority opinion was split between establishing a P1 threshold (similar to the P2 threshold system currently in place) or adjusting the discount matrix to lower the available discount on eligible services. Responses indicate that removing eligible services or placing limitations on the amount of funding for certain types of projects are believed to be of negligible impact.

Respondents also said simplifying the eRate forms is one of the most effective ways to improve the program. Thirty-seven percent favored the creation of a simpler “Form 471 EZ” application, and 28 percent liked the idea of a Form 471 application that was good for three years. Twenty-three percent ranked a fixed filing window dead- line as the most important goal.

The responses to these questions show that applicants overwhelmingly favor a stable, streamlined, and predictable funding source and application process.

For which services is it most important to receive eRate funding?

Two survey questions asked applicants how they would prioritize the use of funding for certain types of services, as well as which eRate funding categories are most important to their organization.

Fast facts

• Thirty-nine percent of respondents indicated that they would prioritize internet access and cloud services over P2 purchases or cellular services.

• If forced to choose only one funding category, 42 percent said they would choose internet access.

It is clear from the survey results that applicants place a high value on funding availability for internet access services, with about 40 percent of respondents indicating that they would prioritize internet access over other types of services. The responses to these questions were very similar between applicants who have received P2 funding within the past few years and those who have not.

While internet access services are clearly a priority for all applicants, there was one significant variation. The variation arose between applicants who have only one site and those who have multiple school locations. Single-site applicants ranked funding for local telephone service as significantly more important than multi-site applicants. Similarly, single-site applicants ranked Internal Connections projects as less important than multi-site applicants. This disparity likely reflects the different circumstances present in a school district versus a single school. It would seem to suggest that single-site schools are worried about more basic connectivity requirements proportionately less than their multi-site school colleagues.

Survey respondents also were encouraged to provide comments as a part of their response. Many of the comments expressed a deep gratitude for the eRate, and overall, they indicated a desire for a simplified, more predictable program that can assist them in providing increasing levels of student internet connectivity. In the face of increasing demand, changes to the program’s structure and operation seem inevitable to many eRate experts. The responses to the survey reveal important themes in schools’ needs and plans for the next generation, which will be critical for ensuring success for future generations of eRate applicants.

Brian Stephens is a senior technology and regulatory analyst for the eRate consulting firm Funds For Learning.

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