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States Vary Widely in their Success with the E-rate Program

An analysis of data compiled on funding commitments made in the first two years of the E-rate program indicates that states varied widely in their ability to capitalize on the discounts made available to schools and libraries under the

An analysis of data compiled on funding commitments made in the first two years of the E-rate program indicates that states varied widely in their ability to capitalize on the discounts made available to schools and libraries under the program.

Participation rates among school districts ranged from 100 percent in some states to as low as 40 percent in others during the second year of the program. Further, on a per-capita basis, states qualified for widely varying amounts of money and for different kinds of services.

Under the E-rate program, schools and libraries can qualify for discounts ranging from 20 to 90 percent on the purchase of telecommunications services, Internet access and internal connections, that is, various kinds of networking equipment. Unlike many education appropriations or grant programs, which are allocated on the basis of population and sometimes by the states, funds are committed directly to schools, both private and public, libraries, school districts and consortia, based on the level of purchases they are willing or able to make. The neediest applicants receive top priority when it comes to funding internal connections.

In September, the U.S. Department of Education issued a report, 'E-rate and the Digital Divide: A Preliminary Analysis from the Integrated Studies of Educational Technology," which provided detailed charts designed to analyze where the money was committed through Jan. 4, 2000 for the first two years of the program. In the first year, applicants with discount rates of 70 percent or higher were able to qualify for internal connections; in Year Two, all eligible applicants qualified.

Funds For Learning has previously published its own analysis of the pattern of funding commitments, based on the number of school-age children in each state.

In terms of participation rates, 13 states achieved participation rates of at least 90 percent of their public schools in Year One and nine achieved that mark in Year Two. In the first year, Hawaii (which has a single school district), Arkansas, Rhode Island, Tennessee, Georgia, Virginia, West Virginia, South Carolina, Indiana, Louisiana, Utah, Delaware and Iowa achieved that mark; in Year Two, Hawaii, Arkansas, Rhode Island, Tennessee, Georgia, Delaware, South Carolina, Virginia and New York achieved that level of participation rate.

Schools were counted as applying if they applied directly, or indirectly, as part of a school district or consortium.

At the other end of the scale, five states posted participation rates of less than 50 percent in Year One (New Hampshire, North Dakota, Maine, Montana and Wyoming) and in Year Two, Arizona, New Hampshire, and Montana were below 50 percent. In Puerto Rico, participation grew from 18 percent in Year One to 45 percent in Year Two.

In another comparison, in both years, 19 states achieved a success rate of 100 percent among those public schools that applied. (That does not mean, however, that every school received funding for everything it sought.)

Other states' schools did not fare quite as well. Eight percent of the schools that applied in New Jersey and New Hampshire did not qualify. In the second year of the program, 14 percent of the schools that applied in New Hampshire and Washington failed to qualify and 10 percent of the schools in Minnesota.

The report also provides interesting data on the extent to which schools in different states sought support for particular kinds of services. For instance, when the application rates for the two years are averaged, in only four states—Hawaii, West Virginia, Missouri and Mississippi, and in Puerto Rico—did as many as 90 percent of school districts in the state apply for internal connections support. In Massachusetts, Illinois, Vermont, Montana, Maine, Nebraska, New Hampshire, Delaware and Utah, fewer than 36 percent of the school districts applied for internal connections support. A school district was counted if at least one school in the district applied.

When the funding commitments are analyzed on a state-by-state basis for both schools and libraries over the two years, and on how much the state received per thousand residents, Alaska was the big winner with $41,514 per thousand residents in total support and $27,634 per thousand residents in support for telecommunications services, reflecting that state's high telecommunications costs. New Mexico topped the internal connections category with $20,103 per thousand residents and Tennessee, a state where the E-rate helped build a statewide network, topped the Internet Access category with $8,042 per thousand residents.

New Hampshire came in last overall ($2,422 per thousand residents) and last in the telecommunications category ($1,729 per thousand residents), while Delaware came in last in internal connections ($338 per thousand residents) and Nevada came in last for Internet Access (at $77 per thousand residents).

The Education Department report noted: 'States vary greatly in their use of the E-rate. State differences in application rates and funding levels reflect a variety of factors including poverty, rural location and prior investments in technology infrastructure. School participation rates may also reflect state and local priorities and leadership."

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