E-Rate 3.0 for a Remote Learning World

As policymakers address the immediate needs of students and teachers, they should also use this as an opportunity to take a fresh look at the E-rate program, both from how it has been operationalized to date as well as its goals for the future. AT&T believes the following principles should guide any expansion of the program:  

• Keep schools the focus of the program and provide them with greater flexibility in meeting core objectives:  As the connectivity needs of schools and students change, the program should adapt to support those needs.  There is precedent for this.  In 2014, the FCC updated the program to cover wireless technologies, including Wi-Fi.  Now, in 2021, when most students are at least partially learning remotely, schools should have greater flexibility to use E-rate funds as they deem necessary to ensure that every student is connected.
• Modernize the program’s rules to ease participation:  As the scope of the program is being debated, we believe the Federal Communications Commission, in consultation with the Department of Education (DoE), should evaluate whether the current E-rate structure is the right one for today’s world.  Given its role in quickly distributing billions of dollars to schools across the country in response to the COVID pandemic, DoE’s learnings may inform any E-rate reform efforts.  The use of technology in schools has transformed greatly in the 25 years since E-rate began and the once nascent ed-tech marketplace is now highly competitive.  Much of this change is due to the success of the program itself.  It is therefore appropriate to now ask whether the program rules that made sense in 1998 are still needed today.  
• Directly address how we pay for E-rate:  As long as E-rate relies on the Universal Service Fund, any long-term expansion of the program must consider the current fragile state of the USF contribution mechanism.  E-rate subsidy demands for the current school year are approximately $3 billion.  This demand contributes to the size of the USF program and impacts how much money the FCC must collect from contributors to the Fund.  With the contribution factor already at a staggering 32%, we have argued that the funding mechanism is fundamentally broken and unsustainable.