Raise the E-rate cap



Recommendation #128

FCC Chapter: 11.18

Status: Completed

The Federal Communications Commission should initiate a rulemaking to raise the cap on funding for E-rate each year to account for inflation.

The current program's annual spending has fallen by about $650 million in inflation-adjusted dollars since the program began. It also is significantly oversubscribed, leaving most internal wiring requests unmet each year. Annual funding applications consistently have exceeded the cap by nearly a two-to-one margin. Some applicants do not apply for internal wiring (Priority 2) funding because they know from experience the cap is reached before many Priority 2 requests are funded.

The E-rate program should be indexed to the inflation rate to prevent continued depreciation.