TR Daily FCC Makes Category Two Budget Approach Permanent
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Tuesday, December 3, 2019

FCC Makes Category Two Budget Approach Permanent

The FCC today made permanent the E-rate category two budget approach it adopted on a test basis in 2014, under which category two funding, which supports internal connections at schools and libraries, can be provided in any year within a five-year budget limit, rather than limiting funding to two years out of five, as it was prior to 2015.

In addition, the FCC said it would “reset” the five-year budgets of all applicants as of 2021, begin fixed five-year budget cycles, and increase the category two funding floor to $25,000. The budgets for schools are based on the number of students and the budgets for libraries are based on square footage.

“Based on the overwhelming record support for the category two budget approach from the E-Rate community, coupled with our own experience during the five-year test period, we conclude that the category two budget approach has provided broader, more equitable, and more predictable funding for schools and libraries than under the prior rules. The budget amount provided to schools and libraries during the test period proved to be successful, and, moving forward, we intend to generally remain within those parameters of support,” the FCC said in an order adopted Nov. 20 and released today in WC docket 13-184.

“Building on the success of the category two budget approach, we take important steps to (1) streamline processes to ensure more equitable, consistent distribution of support for small, rural schools and libraries within the existing E-Rate program budget for category two services, (2) simplify the category two budgets, and (3) decrease the administrative burden of applying for category two services. As a result of the measures we take today, the category two budget approach will become more streamlined, furthering the program’s overall effectiveness and the deployment of Wi-Fi in schools and libraries across the country,” it added.

Democratic Commissioners Jessica Rosenworcel and Geoffrey Starks concurred in the decision.

Commissioner Rosenworcel said, “Though we get the broad outlines of these changes right, I think the agency misses the mark on some key details. To this end, I am concerned that the record before us supports a greater per pupil allowance than what is adopted in this decision. While I appreciate the effort to maintain the status quo, the evidence suggests that some schools hold back because it is impractical to seek Wi-Fi support at current levels. In addition, I am concerned that the decision to adjust this program for inflation only once every five years is akin to a stealth cut. It should be done annually. I also believe that while some libraries may find additional funding opportunities for Wi-Fi are available due to adjustments to their per square footage funding, urban libraries will see their funding levels cut. This is not right and could limit access to the internet in libraries in some of our most populated communities nationwide. Because I think in these respects today’s decision misses the mark, I choose to concur.”

She added, “Finally, it is important to note that we need to keep a close watch on emerging cyber vulnerabilities affecting schools and libraries. The sad truth is that civic institutions nationwide have become targets for attack. Over the last four years, there have been over 700 reported K-12 cyber incidents. These include an attack earlier this year in Louisiana on multiple school districts, forcing the governor to issue a declaration of emergency. In Houston County, Alabama, a cyberattack was purportedly the reason for a delay in the start of the school year. As these problems grow more common, it is appropriate to consider what practices can help prevent school and library networks avoid the inconvenience and harm that follows in the wake of these attacks. So I am pleased that my colleagues agree that the agency should be open to learning more about these challenges. I hope this will help inform policies that across the board will ensure that school and library networks remain strong and secure in the future.”

Commissioner Starks said, “While today’s Order takes meaningful steps towards ensuring the efficient distribution of E-Rate support, we still have work to do. Five years ago, the Commission established a goal of 1 Mbps internet access per student. Unfortunately, 62 percent of school districts still do not meet that standard. I look forward to working with my colleagues to achieve that goal.”

In his separate statement, Commissioner Mike O’Rielly said, “While I would have been open to a much more fundamental review of our E-Rate budgetary framework and disfavor the decision to casually endorse expenditure formulae that were fundamentally flawed when created, I will nonetheless support this item’s efforts to provide applicants with stability and predictability in seeking funds for internal connections. At the same time, I would reiterate the need to weigh ratepayers’ interests just as carefully whenever we increase or make changes to our USF spending. Unlike the E-Rate community, consumers don’t have powerful lobbyists advocating on their behalf before the Commission to control costs, even though they’re ultimately the ones who foot the bill for our subsidy programs. Those who constantly seek to increase spending, including certain individuals in regard to this item, seem to forget that funding isn’t unlimited and comes out of the pockets of hardworking consumers.”

He added, “Further, I acknowledge that some commenters in this proceeding supported the inclusion of network security features and products within the Eligible Services List. While that request won’t be fulfilled in the current item, I am open to discussing the possibility of including such services in the future. My willingness to consider such inclusion, however, does not mean I favor vast new laundry lists of permissible expenditures. Instead, it reflects the simple recognition that without proper diligence, these systems could be extremely vulnerable to mischief, causing extensive harm to users and others while wasting our investments in the process.” —Lynn Stanton, [email protected].com

MainStory: FederalNews FCC UniversalServiceLifeline

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