E-Rate Reform Order Approved with Additional Funding for Wi-Fi

This morning, the FCC voted on its long-awaited Order reforming the E-rate program.  While the text of the Order has not yet been released, descriptions of its contents shared during the meeting and in a press release provide the overarching themes and some details.

Under the Order, the E-rate program’s current structure, which is divided into Priority 1 (broadband and telecommunications services) and Priority 2 (internal connections and maintenance), will be overhauled, though not as dramatically as had been rumored.  Priority 1 will now become “Category 1” and will fund broadband connectivity.  Priority 2 will become “Category 2” and will fund internal connections, including Wi-Fi, using a $2 billion reserve for its first two years.

Some services now eligible for E-rate support will be eliminated: support for voice service will be phased out, while support for paging, e-mail, and web hosting will be eliminated immediately.  The administration of the E-rate program is also set to be streamlined through expedited processing of multi-year contracts and consortium applications.  However, the program’s document retention requirements will be increased from 5 to 10 years, and other transparency rules will be put in place to provide more comparative pricing information to E-rate applicants.

The Order is accompanied by a Further Notice of Proposed Rulemaking (FNPRM) that will examine the long-term needs of the program, including the potential for more funding. The Commissioners’ statements during the meeting highlighted the divisive nature of the proceeding, with Chairman Wheeler strongly supporting the Order, Democratic Commissioners Clyburn and Rosenworcel voting for the Order despite some reservations, and Republican Commissioners Pai and O’Rielly strongly dissenting.