If you’ve read any E-rate news lately, it probably felt like a lot: a big FCC proposal touching the Children’s Internet Protection Act (CIPA), screen time, consultant fees, and competitive bidding, plus a new bidding portal, adjusted Category Two funding floors, and a fresh five-year budget cycle. Here’s the part that matters most: almost none of it changes what you do this year.
Most of what you’re reading about is still a proposal. The FCC circulated a draft set of rule changes on June 4, 2026, and formally adopted it as a Notice of Proposed Rulemaking at its June 25 meeting. That step opens the door for public comments, it doesn’t put any new rule in place. So before we get to what might change, here’s what hasn’t, because that’s most of the program, and it’s still solid ground to stand on.
The basic structure is the same
Category One and Category Two work just like they always have. Category One covers your connection to the building. Category Two covers what’s inside it. Category One still has no set budget cap. Category Two still runs on the same five-year budget model. That cycle simply reset for FY2026 through FY2030, and the funding floors went up a bit for inflation. The structure stayed the same. Only the numbers changed.
The discount matrix also hasn’t changed. That’s the formula that sets your discount rate based on your poverty level and whether you’re urban or rural. No proposal touches that formula right now.
The filing process follows the same steps
You still start with Form 470, wait the required 28 days, and then file Form 471. That order hasn’t changed. Competitive bidding still means posting your Form 470 in public, giving vendors a real chance to respond, and waiting out the clock before signing anything.
There is one bidding change worth flagging, but it’s separate from the proposal above, and it’s already final, not a draft. Back in April, the FCC adopted a rule creating a new USAC-managed bidding portal. Starting in FY2028, service providers will submit their bids through that portal instead of sending them to you directly, and you’ll upload your bid evaluation and contract documents there too. Nothing changes for FY2027 bidding and the portal isn’t planned to go live until around July 1, 2027, alongside the FY2028 Form 470. That’s the horizon to watch, not this year or next.
After you get a funding commitment, the next steps are also familiar. You file Form 486 to confirm service has started and that you meet CIPA rules. Then you invoice through BEAR or SPI, using Forms 472 and 474. If you’ve been through this before, it will all feel familiar this year too.
USAC still runs the program the same way
The Universal Service Administrative Company still handles the day-to-day work. They review applications, manage appeals, run audits, and staff the Customer Service Center. None of the current proposals change who runs the program or how your application moves through the system.
CIPA rules haven’t changed for this year
Yes, the FCC’s draft raises a lot of questions about CIPA. It asks about screen time, personal devices, social media, and what counts as “monitoring.” That’s worth keeping an eye on, and we’ll keep you posted. But right now, your rules are the same ones you already know: you need content filtering, an internet safety policy, and a public notice and hearing before you adopt it. If you’re already meeting those three requirements, you’re in good shape. Nothing new is in effect yet.
What this means for you right now
You don’t need to change how you do things this year. File your forms the way you always have. Keep your CIPA paperwork up to date, since that matters every year no matter what else is happening.
The proposal is worth watching, and we’re reading it closely. When there’s something you actually need to act on, we’ll tell you plainly and in time. Until then, keep doing what works.
News like this raises a lot of “but what about my situation?” questions. Our next My E-rate Guides (MEG) webinar on August 6 is your chance to ask your Guides directly and get plain answers. Register today.
About the Author: Patrick Burke is an E-rate Guide at Funds For Learning. Based in Edmond, Oklahoma, he has guided close to 100 school districts and libraries through the E-rate program over his five years with Funds For Learning.
