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Year 3 Funding Waves to Start as FCC Sets Cap at $2.25 Billion

The Federal Communications Commission announced April 13 that funding commitment letters for Year 3 of the E-rate program will start going out this week as the commission decided to set the cap for the program at the maximum level of $2.25 billion.

The FCC said that $186 million would be committed in the first wave of funding letters. Funding letters will continue to be issued in weekly waves, as they were last year.

This year marks the earliest date by which the Schools and Libraries Division will be able to begin issuing funding commitment letters for a funding year-approximately 2 ½ months before the start of the funding year on July 1, 2000. That timetable also means the letters will start going out less than three months after the close of a filing window, beating by a week or two the pace the SLD was able to achieve in the second funding year. The SLD had to wait until the FCC set the funding cap for the coming year before it could begin issuing letters.

Last winter, SLD officials had said their goal was to get all of the funding commitments issued by sometime in May, to give service providers time to implement discounted billing before the start of the filing year. In recent weeks, various stakeholders have asked the FCC to continue to permit schools and libraries to use the reimbursement process that was put in place during the program's first two years.

The SLD has indicated that it will be able to fund all eligible requests for telecommunications services and Internet access in the third funding year. However, because the demand for support was so high, it will be able to provide funding for internal connections only to the neediest applicants.

In the first wave, applicants with discount rates of 90 percent will be notified that their internal connections requests have been approved, but those with discount rates of 80 percent or below will be denied. Those with discount rates of between 80 and 90 percent will have to wait to find out if their internal connections requests will be funded.

In a press release, the SLD said that 38 percent of the applications processed during the funding window would be processed in the first wave: 7,400 will be funded and 6,195 will be rejected because of insufficient funding. The division said that 95 percent of the applicants notified in the first wave had filed their applications electronically.

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