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Fact Sheet: E-Rate

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Federal Communications Commission
445 12th Street, S.W.
Washington, D.C. 20554
News media information 202 / 418-0500
Fax-On-Demand 202 / 418-2830
TTY: 202/418-2555

This is an unofficial announcement of Commission action. Release of the full text of a Commission order constitutes official action. See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).

September 11, 2000

News Media Contact:
Michael Balmoris at (202) 418-0253


Washington, D.C. - It is an honor and a great pleasure to stand before you today at the release of the first major, comprehensive evaluation of the E-Rate program. More than just confirming the accomplishments of the E-Rate program, the Urban Institute's report verifies its spectacular success in connecting all of our children - rich and poor - to the Internet. I want to commend the Urban Institute and the Department of Education - particularly Secretary Riley and Linda Roberts, his chief advisor on education technology - for putting together this informative and compelling report.

For me, the most gratifying aspect of this report is that it provides proof positive that the E-Rate is delivering technology resources to the schools and communities most in need, shrinking the digital divide.

By the end of 1999, 95% of our schools were connected to the Internet. More importantly, historical disparities between poor and rich schools, suburban schools and those serving rural and inner city neighborhoods, have virtually disappeared with respect to having at least one connection to the Internet. Our next challenge is to extend this achievement to each classroom, so all children can have the opportunities presented by the information age at their fingertips.

This report confirms the success of the E-rate. When the FCC rolled-out the E-Rate program over three years ago, we set out to target the program to the schools and libraries with the least connections - those schools and libraries that serve poor and rural neighborhoods. The Urban Institute report shows that this focus is paying-off. According to this report, our highest poverty public school districts - which serve 26% of public school students - received about 60% of all E-Rate dollars committed. That translates into over $1.3 Billion in discounts for public school districts with 50% or more of their students eligible for the federal school lunch program. In short, the E-Rate is proving to be a veritable Technology Marshall Plan for America's schools.

But the E-Rate is not just for low-income public schools. Millions of other school children and library patrons are also reaping the benefits of the E-Rate. In the program's first two years, over 75% of all public schools and districts applied for funding, more than 50% of all public libraries participated, and over 5000 private schools sought funding. Everybody wins through the E-Rate.

This report also tells me that our work is not yet finished. The poorest of our nation's schools and the most rural of our libraries are still having a tough time getting connected. We know that more individual classrooms are connected and at higher speeds in wealthier schools than in poor schools, and in suburban schools than in inner-city schools. The Urban Institute Report indicates that participation rates for the poorest schools continue to lag behind the participation rates of their wealthier peers. Moreover, applications from small public libraries trail applications from large libraries 50 percentage points.

And herein lies the true value of this document. Beyond showing the extraordinary successes of the E-Rate, it provides us with a road map of what still needs to be done.

I am elated by the Urban Institute's findings and applaud the hard work that went into producing this report. I promise that this report will not gather any dust on my shelf. I will use it to reach our goal of connecting all classrooms and libraries to the Internet.

- FCC -



Who is funded?

95% of public schools were connected to the Internet by year end 1999, up from 65% in 1996.1

Historical disparities between poor and rich, rural, urban and suburban schools have disappeared. All schools regardless of grade level, wealth and location are equally likely to have access to the Internet. 2

82% of public schools (over 78,000 schools) receive Erate funding. 3

Over 83,000 schools (public and private) received Erate funding. 4

Public Schools receive about 84% of the E-rate dollars. 5

60% of E-rate funds go to districts with more than 50% of the students eligible for free or reduced price lunch. These schools have 25% of the public school students. 6

Who applies?

Application rates are lower in the poorest schools. Over 80% of schools with 75% poor children applied for the E-rate, but application rates decline by 10 percentage points for those schools with even higher poverty rates. 7

However, application rates among the poorest schools increased from 71% to 79% from Year 1 to Year 2. 8


63% of public school instructional classrooms had internet connections by year end 1999, up from 14% in 1996. 9

Disparities between rural, urban and suburban, and between rich and poor schools still exist with respect to connections for instructional classrooms. 10


51% of public libraries have received Erate funding. 11

Libraries receive 4% of the E-rate dollars. 12

40% of the E-rate library dollars go to libraries in the poorest neighborhoods, serving 23% of the served population. 13

The poorest libraries received twice as much funding per person as the least poor libraries. 14


58% of the E-rate funds in years 1 and 2 were used for internal connections. 15

34% of the E-rate funds in year 1 and 2 were used for telecommunication services. 16

8% of the E-rate funds in Years 1 and 2 were used for Internet access. 17

63% of public schools use dedicated line connections (which includes some 56K speed lines). 18


1. NCES 2000-086
2. NCES 2000-086
3. Year 2 USAC number. Urban Institute treats districts, schools and consortia separately. This is an estimate of public schools regardless of how they applied. Page 131 says 75% apply.
4. Year 2 USAC number.
5. Urban Institute, page 131.
6. Urban Institute, page 134.
7. Urban Institute page 134.
8. Urban Institute, page 134.
9. NCES 2000-086.
10. NCES 2000-086.
11. Year 2 USAC estimate.
12. Urban Institute, page 131
13. Urban Institute page 134
14. Urban Institute page 134.
15. Urban Institute page 132.
16. Urban Institute page 132.
17. Urban Institute page 132.
18. NCES 2000-086.