Pai’s E-Rate Revamp Would Focus on Next-Gen Internet Services, Eschew Broadband Speed Target

Pai criticized the ConnectED initiative of President Barack Obama, which proposed schools and libraries be connected through broadband of at least 100 Mbps, with a target of 1 Gbps (CD June 7 p7). Commissioner Jessica Rosenworcel has called for an “E-rate 2.0” with a goal of 100 Mbps per 1,000 students by 2015 and 1 Gbps per 1,000 students by the end of the decade (CD May 3 p8). But “different communities have different needs,” Pai said. “We shouldn’t force schools to skew their spending decisions in order to help meet an arbitrary national target. In FCC surveys, most respondents were satisfied with the speeds they had. “Faced with a choice between a one-dimensional national benchmark or local autonomy, I favor the latter."

Under Pai’s plan, the E-rate budget would be allocated across every school in America, with schools receiving money on a per-student basis. That means the funds would follow students when they change schools. Schools in rural or low-income areas, and smaller schools with higher costs, would get additional funds. The first step is clearing out the decade’s worth of backlogged appeals and eliminating “the red-tape funding gap,” Pai said. “In just its first year of implementation, my plan would provide over $1 billion in additional funding for next generation technology without any increase in the program’s budget."

Pai’s plan would eliminate the distinction between Priority One funding, which covers telecom services and Internet access to a building, and Priority Two funding, for internal connections. Those internal connections include wiring up individual classrooms for Internet access, but there’s usually not enough Priority Two funding to go around, he said. Pai wants to “redirect” spending “away from outdated services” like voice telephony, and toward “next generation technologies that directly benefit students,” he said. “That means funding classrooms and learning centers instead of non-instructional buildings like garages and athletic facilities."

Pai’s office circulated a list of “positive feedback” it had received on the plan. “The time to be funding stand-alone telephone service is past,” said former FCC Chief Economist Michelle Connolly, applauding the larger matching requirement proposed by Pai. “Pai’s recommendations address an amazing number of problems with the current E-rate program,” she said. Former FCC Commissioner Deborah Taylor Tate said she shares Pai’s belief that “we must resist the urge to impose a one-size fits all mandate from Washington.” Sen. Roy Blunt, R-Mo., commended Pai’s efforts to eliminate the E-rate program’s inefficiencies and return spending control to local schools. Rep. John Shimkus, R-Ill., called the plan “fiscally responsible."

It would be hard to offer significant feedback until Pai more fully develops the general guidelines he provided, said Michael Spead, senior technical specialist at consulting firm ICF International. Still, Spead said he has some initial concerns. “Low-income families and rural schools that need the most funding to provide quality education in the 21st century and bridge the digital divide, may suffer reductions in overall funding when compared to well-to-do or urban counterparts,” said Spead, former senior manager of the high-cost program at the Universal Service Administrative Co. “In terms of administration, funding based on students (and their movement) would be particularly challenging to capture and track over time, which may open this program to additional concerns about waste, fraud, and abuse, similar to those faced when tracking low income consumers for the Lifeline program."

The current E-rate program is complicated for schools to apply for, and has led to a cottage industry of consultants and people taking advantage of the system, he said. Those will be the skeptics of his proposals, Pai said: “Consultants may fear lost business if the paperwork and the labyrinth of rules disappear. Those who have figured out how to game the system may complain about their lost support."

Several school superintendents had a “great” 45-minute conversation with Pai last week, and many of those ideas came through in Pai’s comments, said Noelle Ellerson, assistant director-policy analysis and advocacy for AASA: The School Superintendents Association. But the group is concerned that, even if savings can be found in the short term from increased efficiencies, the “deeper connectivity” contemplated by the various E-rate proposals by Pai and others hints at a higher long term cost, Ellerson said. None of the commissioners’ proposals “will move alone in isolation,” she told us. “The thing that all of them have in common is a higher level of connectivity” either through individual schools or a sustained higher level of broadband. That has “long term implications” because maintaining that increased level is an annual cost, she said: “That is part of the strength and frustration of E-rate.”