The E-rate program’s current funding cap and 1998-era priority rules are producing an odd consequence: the current system prioritizes funding for applicants based on their technology choices, rather than their financial need or location.

Take rural schools for example. There are 11.77 million students listed on E-rate applications from rural schools. In FY2013, $524 million in Priority 1 service discounts was requested to support these students. Rural schools also requested $271 million in internal connections discounts to connect their students to their Priority 1 services. Yet, under the current E-rate funding cap and priority system, those internal connections funding requests are likely to be denied. Without adequate internal connections infrastructure, rural schools will struggle to provide their students with adequate Internet connectivity.

Does anyone else but me find it troubling that the E-rate program is denying funding for the infrastructure to connect those students to the Internet? How is this acceptable? Does it really make sense to fund services to the front door of the school building while denying funding for the Wi-Fi and other networking gear necessary to utilize those services?

Looking forward to FY2014 and beyond, the situation looks even worse. Without additional funding or changes to the E-rate priority rules, a significant number of rural schools will be denied ALL E-rate support.

  • In FY2013, all 8,169 rural school districts are likely to be denied Priority 2 support.
  • As early as FY2014, 2,056 rural school districts that have an E-rate discount rate below 60% may be denied both Priority 1 and Priority 2 funding.
  • As early as FY2015, 4,583 rural school districts that have an E-rate discount rate below 80% may be denied both Priority 1 and Priority 2 funding.

Funds For Learning estimates that 4,583 rural school districts, representing 7.7 million students, are at-risk of losing out on all E‑rate support by FY2015.

Should something be done to protect the funding for these rural schools? And shouldn’t rural schools be given the opportunity to install internal connections to connect their students?