When learning shifted online during the pandemic, Congress authorized more than $7 billion through the federal Emergency Connectivity Fund for the equipment and services needed to connect students to their lessons remotely. Although that program ended June 30, it proved to be a big success. Now, the FCC has adopted new rules for the E-rate — the federal program that provides discounts on internet access solutions for schools and libraries — to address the need for student connectivity outside of school on a permanent basis.
According to Funds for Learning research, nearly three-quarters of E-rate applicants say a lack of home broadband access is a significant barrier to learning in their community. Hoping to solve this challenge, a ruling adopted by FCC on July 18 makes Wi-Fi hotspots that schools and libraries purchase and loan to students for use at home eligible for E-rate discounts going forward.
Under the new rules, Wi-Fi hotspots intended to support learning outside of school — including both the device itself and the monthly service charge — are eligible for Category One E-rate discounts. Previously, only equipment used on school or library property was E-rate eligible. To take advantage of this ruling, however, schools and libraries must adhere to a number of requirements intended to curb waste, fraud and abuse.
It’s possible these rules might change. In late September, the FCC said it had received petitions from the Los Angeles Unified School District and other parties asking the agency to revisit its decision, citing concerns about how the rules would be enforced. But as of now, here’s what we know about how the program will work.
Eligible services and equipment
The new rules apply to Wi-Fi hotspots intended for just a single user. Other technologies for connecting students to the internet from home, such as private LTE, CBRS or similar services, aren’t eligible for E-rate discounts. Neither is wireless service to multifunctional devices such as smartphones, laptops or tablets.
To be eligible, a Wi-Fi hot spot must meet the FCC’s definition for such a device: It must be portable, limited to a single device (as opposed to a set of linked devices) and must not contain any Ethernet ports.
Budget and funding caps
E-rate applicants can’t apply for discounts on more than one hot spot per student or library patron. To make sure all applicants have an equal opportunity to receive E-rate funding for Wi-Fi hot spots, there is a cap on the amount of pre-discount funding allowed for these devices over a three-year period.
Each applicant will calculate its budget for Wi-Fi hotspots using a set formula. This formula considers the number of students (in the case of a school or district) or the square footage of the facility (in the case of a library), adjusted by the Category One discount rate.
The formula is modeled after the budget for Category Two E-rate services but with a different calculation. It establishes a presumption of up to 20 hot spots per 100 students or 5.5 hot spots per 1,000 square feet of library space, as well as a three-year cap of $630 on the pre-discount cost of these units.
Here’s an example. A school with 500 students and a 90% Category One discount rate would have a pre-discount funding cap of $56,700 for Wi-Fi hotspots over a three-year period:
500 students x (20 hotspots / 100 students, or 0.2) x $630 x 0.90 discount rate = $56,700
A library with 10,000 square feet and a 90% Category One discount would be eligible for up to $31,185 in E-rate discounts for Wi-Fi hotspots over a three-year period:
10,000 square feet x (5.5 hotspots/1,000 sq. ft.) x $630 x 0.90 discount rate = $31,185
In the formulas above, the calculations in parentheses are rounded to the nearest 10 when calculating funding caps.
In addition to this three-year funding cap, the rules establish a pre-discount limit of $90 per hot spot device purchased and $15 per month, per line, on recurring internet service.
Application process
Wi-Fi hot spots are subject to the same rules governing other E-rate eligible services.
For instance, schools have to comply with the Children’s Internet Protection Act to be eligible for funding, meaning they must have technology in place to safeguard students online. They must follow all E-rate competitive bidding requirements, including posting a Form 470, collecting bids and waiting at least 28 days before signing a contract and filing a Form 471. Plus, they must keep all documentation for at least 10 years from the last date of service received.
According to the FCC, schools receiving E-rate support for Wi-Fi hot spots are required to maintain the make, model and serial number of these devices; the full names of the students to whom the equipment was provided; the dates the equipment was loaned out and returned; and the line numbers or other unique identifiers that associate a device with a particular line of service. Libraries must maintain the same records, excluding the full names of the patrons borrowing the hot spots.
Evaluation and selection criteria
If the demand for E-rate funding exceeds the amount of money available, Wi-Fi hot spots and service loaned to students for off-campus use will be funded only after all requests for on-campus services have been funded.
To prevent schools and libraries from stockpiling Wi-Fi hotspots and to ensure the devices are being used properly, lines of service that aren’t used for three consecutive months must be terminated by the service provider. Service providers must notify applicants of lines that go unused for 60 consecutive days and then give applicants 30 days to use the hot spot before ending the service. Applicants are also prohibited from requesting funding for Wi-Fi hot spots they plan to use in the future or for emergency storage in the event of theft, loss or breakage.
Funds for Learning recently held a webinar to explain the new Wi-Fi hot spot rules and what they mean for schools. The company has helped schools navigate E-rate regulations since the program began in the late 1990s.
Opinions expressed by SmartBrief contributors are their own.
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