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May 27, 1999

Statement of
Chairman William E. Kennard

Funding for the Second Year of the Schools
and Libraries and Rural Health Care
Universal Support Mechanisms

As members of the FCC, sometimes we have the occasion to witness events and even make decisions that will shape the communications revolution for years to come, decisions that will impact how technology can and does affect people's homes, businesses, families, and lives.

Today is one such occasion. I will be voting to fund the e-rate – a program to wire schools and libraries to the Internet – to its cap of $2.25 billion for its second year.

Before the e-rate, only 39 percent of classrooms in poor school districts in rural and urban America had any Internet connections compared to 62 percent of classrooms in wealthier districts. The on-ramps to the Information Superhighway were bypassing the communities that needed access to opportunity the most.

After one year, though, we find that the digital divide is narrowing. Over 80,000 schools and libraries – and more than 38 million kids – have been helped by the e-rate program. Because of the e-rate, more than half of the unconnected classrooms will now be linked to the Internet, the bulk of which are found in schools where over half of the students live in poverty.

And according to Forrester Research, Internet access among African-Americans is expected to increase 42 percent, and among Hispanics 20 percent – two phenomena that Forrester chalks up to the e-rate program and its ability to bring this technology into every community.

By funding to the cap, we'll be able to wire 528,000 public school classrooms to the Internet. If we meet this high demand, we will be able to help schools that teach 40 million American children. We'll allow libraries and schools that never would have been able to pay for these services the chance to connect to the Internet. We'll be able to connect communities throughout rural America.

The funding that we authorize today will be sufficient to ensure fully-funded discounts for all telecommunications services and Internet access and to fully fund discounts for the neediest schools and libraries for internal connections to the same level of discount as was funded in the first program year. Unfortunately, some applicants' needs will not be met in full, but we have acted to ensure that support will be directed to rural areas and the most economically disadvantaged schools and libraries. Based on the record, we believe that the funding rates we have established today reasonably balance the need to provide support with the costs associated with a larger support program.

Moreover, funding at this level is the only way in which we can reach those schools and libraries in rural America. In fact, by funding the e-rate to its cap, we'll be able to connect one-third of public schools throughout rural America.

If you have ever traveled through our nation's countryside and spoken to the people who live in its small towns and on its farms, you will hear firsthand how important these connections are to them. With links to the on-line world, students won't have to travel far distances to take courses not offered in their schools. More time can be spent in the community giving a child the nurturing and support that they need. And with the "death of distance," educational and economic opportunities will become available locally and families will be able to comfortably stay on the land on which they've lived for generations.

To further help families in our nation's small towns and farms, we are also directing the Universal Services Administrative Company to collect the funds required to meet projected demand up to $12 million over the next year for the rural health care support mechanism.

Over 200 years ago, Benjamin Franklin – who incidentally helped found a great university, the University of Pennsylvania, and a great library, the Philadelphia Free Library – once remarked that "If a man empties his purse into his head, no one can take it away from him. An investment in knowledge always pays the best interest."

The e-rate is one such investment. It's a down payment on the future of our kids and of our economy. By exposing more and more of our children to the Internet and information technology, they will learn the skills needed to gain the high-paying jobs of our Information-Age economy. They will be linked into our national community. They will be given the digital tools needed to fulfill the promise of American life in the Information Age.