FCC Ponders E-Rate Budget Increase

A budget expansion would require both increased fees and lower broadband prices.

by News Staff / November 18, 2014

The Federal Communications Commission is considering a proposal to expand E-rate funding, which helps subsidize school and library broadband.

A draft order created by FCC Chairman Tom Wheeler would increase the E-rate budget by $1.5 billion from its current cap of $2.4 billion. Wheeler sent the proposal to four commissioners on Monday, Nov. 17. 

The independent commission had already modernized E-rate this past summer in a move designed to shift money away from telecommunications to broadband and Wi-Fi. But Wheeler says the job isn't done.

He argues that schools and libraries don't have enough funding to either bring high-speed broadband to their campuses or to keep up with rapid demand once they have it. In particular, rural school districts don't meet recommended speed targets, and they generally pay steeper prices for that service because of their location. 

But this proposal relies on both increased Universal Service Fees on consumer phone bills and drastic price reductions from broadband service providers.

Consumers already pay $0.99 every month to the fee, and that would be increased by $0.16 to a total of $1.15. Over a year, that adds up to nearly $14 per person.

This staff report was originally published by the Center for Digital Education