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USAC Recommends Funding FY 2009 Priority Two Applications at 80%

The USAC Schools and Libraries Committee will request authorization to fund FY 2009 E-rate funding year priority two requests at 80%. This decision comes during their Quarterly Board Meeting which was held today. The request now moves to the FCC for final approval. If the measure is approved, E-rate applicants may start to receive notifications within a few weeks of FCC authorization.

This would be the first time since FY 2005 that USAC believes they can fund priority two applications down to 80%.  Here is a current breakdown since FY 2000 of the priority two funding threshold:

  • FY 2009 – 80%, pending FCC approval.
  • FY 2008, 88% and possibly could move down to 87%
  • FY 2007, 83%
  • FY 2006, 86%
  • FY 2005, 80%
  • FY 2004, 81%
  • FY 2003, 70%
  • FY 2002, 81%
  • FY 2001, 86%
  • FY 2000, 82%

About E-rate Funding Priorities

Each request for E-rate funding falls into one of four service categories Telecommunications Services, Internet Access Services, Internal Connections, or Basic Maintenance of Internal Connections. Requests in the Telecommunications and Internet Access service categories are given priority over other requests and are called Priority One  requests. Requests in the remaining categories are assigned a Priority Two designation.

The SLD must set aside money for all of the potentially fundable Priority One requests received within the application period for a given funding year. Any remaining available money for Priority Two requests is committed to those applicants with the highest discount rate. Priority Two requests are funding for each discount rate percentage until available funding is depleted for the year.

The amount of funding available for a funding year can increase from the allotted $2.25 Billion from the Universal Service Fund for the E-rate program. Unused funds from previous funding years are typically made available to supplement the amount of available funding each year. The SLD is also allowed to issue commitments in excess of actual available funding based on estimated under-utilization by applicants each year.

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