Requests snowball for E-Rate

USAC: Schools and Libraries program

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Schools and libraries that have applied for federal funds to help subsidize telecommunications services and Internet access soon will receive letters saying whether they've been approved.

However, most applicants seeking money won't get it because competition for limited E-Rate funds has risen sharply in the fourth year of the program.

E-Rate, created as part of the Telecommunications Act of 1996, provides schools and libraries with discounts of 20 percent to 90 percent for Internet access and telecommunications infrastructure and for internal connections. The program, which earmarks up to $2.25 billion annually — the maximum set by the Federal Communications Commission — is funded by the telecommunications industry through taxes on individual telephone bills.

The Universal Service Administrative Co. (www.sl.universalservice.org), a private, nonprofit organization established by the FCC to administer E-Rate, soon will release an initial wave of $395 million for the 2001-2002 program. As in the past, E-Rate funds will be released in several waves throughout the year.

More than 17,800 letters announcing funding commitments were to be mailed July 23, along with another 6,000 letters denying requests because of insufficient funds. This means that more than 70 percent of the applications have been processed in this wave.

More than 30,000 applications, requesting $5.19 billion, were submitted for this year's program. That request is larger than the first two program years combined and nearly $500 million more than requested in the third year of the program.

USAC spokesman Mel Blackwell said that as the E-Rate program has become better known and schools and libraries have seen the benefits from the program's first three years, institutions are asking for more money.

Of $5.19 billion requested, $1.7 billion was for telecommunications services and Internet access, while $3.49 billion was for internal connections. Blackwell said they'll consider only requests from the neediest schools for internal connections. "Neediest" is defined as schools where 50 percent or more of the students receive school lunch subsidies.

Blackwell said that it is up to the FCC to raise the cap on the $2.25 billion allocated each year to the program.

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