The Schools and Libraries program, also known as the E-rate program, makes telecommunications and information services more affordable for schools and libraries in America. Congress mandated in 1996 that the Federal Communications Commission use the federal Universal Service Fund (USF) to provide discounted eligible telecommunications, Internet access, and internal connections to eligible schools and libraries.
Innovative digital learning technologies and the growing importance of the Internet in connecting students, teachers, and consumers to jobs, life-long learning, and information, are creating increasing demand for bandwidth in schools and libraries. The FCC began updating E-rate in 2010, and is now initiating a full review to modernize the program. To learn more about efforts to modernize the E-rate program, go to www.fcc.gov/e-rate-update.
Here are some frequently asked questions about the E-rate program:
What Benefits Are Available Under the E-Rate Program?
- Eligible schools and libraries may receive discounts on eligible telecommunications, telecommunications services, Internet access and internal connections (for example, wiring and Wi-Fi routers to provide wireless connections in classrooms), and basic maintenance of internal connections.
- The discounts range from 20 to 90 percent, with higher discounts for higher poverty and more rural schools and libraries. Schools and libraries are always responsible for paying at least some part of the cost of service.
How Does the E-Rate Program Work?
- Schools and libraries engage in regular technology planning to determine their connectivity needs.
- A school or library that wishes to participate in the E-rate program then puts out a request for competitive bids for E-rate supported services. The bid request and competitive bidding process must comply with FCC rules and state and local procurement laws.
- Vendors bid to provide the requested services to the school or library. After the school or library selects a vendor, it files an application with the Universal Service Administrative Company (USAC) for approval of its request for eligible discounted services. The FCC administers the USF with the help of USAC.
- After USAC approves the school's and/or library's application, the vendor provides the eligible services to the school or library at discounted prices. Generally, the vendor, upon invoice submission, is then reimbursed the amount of the discount from the USF.
How Much Funding Is Available and How Are Requests Prioritized?
The E-rate program is capped at $2.25 billion, indexed to inflation since 2010. For the 2013 funding year, schools and libraries sought E-rate funding in excess of $4.9 billion, more than twice the 2013 cap of $2.4 billion. Demand for services has exceeded the E-rate cap every year since the program's inception.
Requests for all telecommunications, telecommunications services and Internet access services are funded as "priority one" services: they receive first priority for support. Remaining funds are allocated to requests for support for internal connections and basic maintenance of internal connections – called "priority two" services. Priority two requests are funded beginning with the highest poverty schools and libraries and continuing until funding runs out.
While the E-rate program has traditionally been able to fund all priority one requests, it has historically been able to fund priority two requests from only a fraction of schools and libraries.
Who Pays for the E-Rate Program?
All telecommunications service providers and certain other providers of telecommunications must contribute to the federal USF based on a percentage of their interstate and international end-user telecommunications revenues (generally a small fraction of the overall consumer bill). These companies include wireline phone companies, wireless phone companies, paging service companies, and certain Voice over Internet Protocol (VoIP) providers. These contributions fund all four of the FCC's Universal Service Programs: The High Cost Program, which helps extend phone and broadband service to rural areas, the Lifeline Program, which helps support basic phone service for low-income Americans, the E-rate program, and the Rural Health Care Program.
Some consumers may notice a "Universal Service" line item on their telephone bills. This line item appears when a company chooses to recover its USF contributions directly from its customers by billing them this charge. The FCC does not require this charge to be passed on to customers. Each company makes a business decision about whether and how to assess charges to recover its universal service costs. These charges usually appear as a percentage of the consumer's phone bill. Companies that choose to collect universal service fees from their customers cannot collect an amount that exceeds their contribution to the USF. They also cannot collect any fees from a Lifeline program participant.
Does the FCC's E-Rate Program Duplicate State and Local Efforts?
The FCC's plan complements the efforts of states and localities to bring advanced telecommunications to America's classrooms and libraries. When the E-rate program was established in 1996, only 14 percent of the nation's K-12 classrooms had access to the Internet. Today, because of the FCC's E-rate program, virtually all schools and libraries have Internet access.
How Can I Find Out How Schools and Libraries in My Area Are Benefiting from the E-Rate Program?
You can visit USAC's website to find Schools and Libraries funding specific to your state. Go to www.universalservice.org/sl/ and follow the prompts to "Funding Commitments."
For More Information
For information about this and other telecommunications issues, visit the FCC's Consumers website, or contact the FCC's Consumer Center by calling 1-888-CALL-FCC (1-888-225-5322) voice or 1-888-TELL-FCC (1-888-835-5322) TTY; faxing 1-866-418-0232; or writing to:
Federal Communications Commission
Consumer and Governmental Affairs Bureau
Consumer Inquiries and Complaints Division
445 12th Street, SW
Washington, DC 20554
You can also view guides on other Universal Service programs on the FCC website at: