Thinking Ahead to E-Rate 2016

The E-Rate program just got interesting for schools and libraries. It’s going to take a bit to explain. Fasten your seat belts and keep your arms and legs inside the ride at all times.

The FCC began poking at the E-Rate program in July 2014. In short, they dropped support for telephones and added support for wireless connectivity in schools and libraries. “Nice start, E-Rate.”

In late December the FCC announced that it would increase the funds available for schools and libraries from $2.4 billion to $3.9 billion. “Thanks E-Rate Santa!”

We came back after the holidays and started digging into the details. There are three other - very big, very interesting - gifts that E-Rate Santa left behind.

E-Rate Lifts Barriers Preventing Schools and Libraries from Building/Owning Fiber Networks

Beginning in E-Rate 2016 (not this funding year - next) schools and libraries will be allowed to use E-Rate funds to build and own their own fiber infrastructure. They will also be able to spread the non-discounted costs over several years instead of paying it all up front.

Your $100,000 project just turned into a $30,000 project that can be spread over 3 years. 10x the capacity at 1/10 the current state contract rates. You can know own the infrastructure instead of leasing it. It’s paid for after 3 years and yours to use as you see fit (10 Gbps, 1000 Gpbs) years 4 - 20.

E-Rate Adds Money to the Fund

I mentioned earlier that E-Rate Santa raised the funding from $2.4 billion to $3.9 billion per year. Turns out, there’s an extra $1.5 billion laying around from previous years that will get plowed into E-Rate 2015 and 2016. E-Rate 2017, 2018, and 2019 earmarks $1 billion of the overall fund specifically to internal connections.

For the first time in forever, there’s more money available in the E-Rate program.

E-Rate Adds Support for Rural Areas

When the FCC first proposed changes in July 2014, a number of schools and libraries that were previously designated “rural” were reclassified as “urban”. Many communities as small as 2500 found themselves on the wrong side of that line. Changes in December 2014 now consider communities of less than 25,000 to be rural.

Two other details regarding rural schools and libraries. The FCC intends to establish pricing benchmarks in order to keep providers honest with pricing in rural vs. urban areas. The FCC will also require providers respond to RFP’s from schools and libraries if that provider serves that area. Both changes will push providers towards lower, more reasonable pricing.

Interestingly, many of Wisconsin’s best connected schools are already in rural areas. The FCC is doing their best to create more opportunities for rural Wisconsin.

This, friends, is all really big news for schools and libraries looking to support the needs of their communities. Back in 2009 we used the National Broadband Plan and federal broadband stimulus program to ignite interest in making things happen. These strategies proved incredibly successful for communities ranging from Waukesha to Fall Creek. While a few benefited from federal and state funding programs, many communities simply found the value in working together - schools, libraries, hospitals, city, county, higher ed - to address their own needs directly.

We have another interesting opportunity ahead with these changes to the E-Rate program for schools and libraries. Again, most of the pieces above won’t be in place until the 2016 E-Rate cycle (not this one, the next). We’re planting the seeds for you to begin thinking ahead.