FCC Proposes Category 2 Changes & Seeks Comments

FCC Proposes Category 2 Changes & Seeks Comments

This week the FCC released the long-awaited Notice of Proposed Rule Making (NPRM) on the E-rate Category 2 program. The good news is that the FCC proposes to take the 5-year “C2 test” period and make it permanent (and not revert to the old 2/5 system), as well as extend the eligibility of MIBS, caching and basic maintenance services. Unfortunately, the NPRM does not provide an answer to the biggest question -- what funding will be available in FY 2020 for applicants that first used C2 funding in FY 2015. To develop those rules, the FCC is seeking comments on a long list of questions/issues, for which I have summarized the most significant ones below. After the comment period, the FCC will review the submissions and develop final rules for implementing C2 budgets in FY 2020, and any other changes they’d like to make to the program.  Hopefully, that Order will be released this fall.

I have included 2 links just below. These are a summary the actual NPRM from the FCC and a chart that correlates back to the NPRM by paragraph. The actual NPRM is only about 13 pages long and I encourage you to read it and consider submitting comments, even if only to provide input on a single question or issue. Let me know if you’d like to do this and I’ll help you navigate how to submit to the FCC’s ECFS comment system.

Comments will be due on August 16, 2019.
Reply posts are due by September 3, 2019.

Links: 

NPRM

Summary of NPRM

Summary of Major Questions in NPRM:

1. FCC proposes to keep the current $150/student (adjusted for inflation) budget multiplier. 
1. Should the minimum budgets for small schools and libraries be increased to $25,000? (¶ 20)
2. Should the rural library budget multiplier be increased (perhaps to match the urban library $5.00/sq. ft. multiplier)?  If so, submit specific data and examples to support the need.  (¶ 21) 

2. Should budgets be administered on a districtwide basis?  Would libraries benefit from a system-wide budget? (¶ 24)
1. If district-wide budgets are adopted should the equipment transfer rules within a district be eased? (¶ 27) 

3. Should the student count and square footage in the first year of a five-year cycle be used for all five years to ease administration of the budgets?  
1. Or are there significant advantages to having the budgets rise (or fall) depending on student population or square footage each year? (¶28)
2. Should a presumption be established that the student counts verified in one of the last four funding years are still accurate for the purposes of setting a category two budget, absent an effort by the applicant to increase the student count? (¶ 28)

4. Should 5-year budgets be allocated on a “rolling” basis or should there be fixed, 5-year periods for everyone (e.g., FY 2020-2024, FY 2025-2029, etc.)?  What are the costs and benefits of either proposal? (¶ 32)
5. Should all C2 budgets be reset as of FY 2020?  (¶ 35) 

6. What are best ways to transition from the existing C2 budget rules following the five-year test period, to the new rules?
1. Should the current rules be extended for one year, without modification, so that FY 2020 will be used as a bridge to transition to the final rules? (¶ 36)
2. What are the best ways to reduce applicant confusion and provide for simplified administration of the C2 budgets as we move beyond funding year 2019? 

7. Are there any additional services that should be eligible for category two funding or any other issues regarding category two eligible services that the FCC should consider? (¶18)

If you have any questions, please let me know.  

-- Todd Lawrence