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SLD Projects Year 5 Demand at $5.736 Billion

The Schools and Libraries Division reported to the Federal Communications Commission March 1 that schools and libraries had requested a projected $5.736 billion in E-rate discounts for Year 5 of the program.

The SLD noted that that figure could drop as it weeded out duplicate applications and ineligible services. It warned–as it did at this stage in Year 4–that it might be unable to fund all requests for internal connections from applicants at the 90 percent discount rate, much less any requests below that level.

The SLD has not yet finished making its commitments for Year 4, but as it turned out, it it has been able to fund internal connections requests from applicants with a discount rate of as low as 87 percent. That threshold could still drop lower.

The SLD said 36,403 applications were filed within the Year 5 application filing window and that 85.7 percent of them were done online. Over 77 percent of the requests were associated with schools and libraries that said they were eligible for discounts at the 80 and 90 percent level.

The estimated demand for Priority One services was $1.817 billion, with $2.619 billion requested for internal connections. By comparison, through March 1, the SLD has distributed $2.135 million in commitments for Year 4, with $789 million committed for telecommunications services and $251.8 million for Internet access, producing a Priority One total of $1.041 billion. Based on those nearly complete figures, its Year 4 projection for Priority One services could turn out to be as much 30 percent higher than what it ended up committing in that category. In Year 3, the projection for Priority One services was about 38 percent higher than commitments turned out to be when the bulk of them were done.

If the SLD's Year 5 projection turned out to be off by as much as 30 percent, it would leave just under a billion dollars available for internal connections from the usual E-rate funding pool of $2.25 billion. However, the FCC is permitting the SLD to commit slightly more than that amount for Year 4, based on the program's historical pattern of disbursements falling behind commitments. Further, it is possible that the FCC could decide to roll over undisbursed dollars from previous funding years to make more money available for commitments.

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