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Gap in E-rate Commitments and Disbursements Persists

The gap between E-rate commitments and disbursements continues to persist, the General Accounting Office reported to Congress on May 11.

Based on updated reports from the Universal Service Administrative Company, the GAO said that as of April 24, 2001, the amount of unused funds for the first two program years was $774 million. In August 2000, before all invoices for Year 2 were due, the GAO had reported that the figure was $1.3 billion. Of the $774 million, $314 million was used to reduce contributions from telecommunications carriers in the first funding year.

The report included an analysis of which kinds of funds were committed but not disbursed. In Year One, 25.3 percent of internal connections commitments went unspent, 29.8 percent of Internet access commitments were unspent and 13.5 percent of telecommunications commitments went unspent. Overall, 19.4 percent of Year One commitments were not spent.

In Year Two, the same pattern persisted. Just over 34 percent of internal connections commitments went unspent, compared with 39.9 percent of Internet access and 23.4 percent of telecommunications commitments. Overall, 28 percent of commitments were disbursed.

The numbers do not include the "out-of-window" commitments that the SLD issued in April 2001.

The GAO said that the Federal Communications Commission still needs to determine whether changes in program rules and procedures need to be made to address the difficulties that applicants may have in using their funds in a timely manner. The GAO made that recommendation last December.

Copies of the full report are available at

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