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E-Rate Narrowing Digital Divide

Share School Issues CenterA report by the Urban Institute, a non-partisan research group, has shown that the federal government's program to subsidize Internet equipment and access for schools and libraries is paying big dividends. Included: Seven key findings from the report.

Federal funds subsidizing Internet installation and operating costs for rural and urban schools and libraries are largely hitting their mark. But some of the smallest and poorest school systems still are not involved with the Universal Service Fund for Schools and Libraries, or the "e-rate program," according to a recent report by the Urban Institute.

The report, E-Rate and the Digital Divide: A Preliminary Analysis from the Integrated Studies of Educational Technology, prepared by the Urban Institute, notes significant gains in narrowing the digital divide -- the gap between those institutions that have Internet access and those that do not -- since the funding program began four years ago.

"Clearly, [funding] is largely going to schools and districts in the most need of assistance," said Michael J. Puma, principle research associate with the Urban Institute and one of the authors of the report. "But some of the most disadvantaged schools still have a way to go."


Highlights of Urban Institute E-Rate Study

The Urban Institute included seven key findings from its study:

* Public schools have made the most use of the e-rate program. In the first two years, 84 percent of funds went to public schools.

* The program targeted poor communities.

* Fewer of the poorest school districts applied for funds than other school districts in the first year. But the number of applications rose for all institutions in the second year, and even more so for high-poverty districts than others.

* Large schools and libraries are more likely to apply for funds.

* Both urban and rural school districts benefited from the program.

* Most e-rate funds are used for internal connections: About 58 percent of the money was used to buy equipment and services for internal building connections, 34 percent for telecommunications services, and 8 percent for Internet access.

* State application rates vary according to several factors, including poverty, rural location, and prior investments in technology.

The e-rate program was included in a federal law called the Telecommunications Act of 1996. Schools and libraries can apply for discounts of between 20 and 90 percent on local and long distance phone and Internet access services. The program also provides money for the purchase and acquisition of equipment for network wiring.

The Urban Institute study is the first comprehensive analysis of the first two years of the program.

"I think it is a very important analysis, and one that gives us a sense that the program is working the way it should be working," said Linda Roberts, director of the Office of Educational Technology for the U.S. Department of Education and senior adviser to the Secretary of Education William Riley. "The money is going to the schools and libraries with the greatest need."

The report indicates that the most impoverished school districts have received almost ten times as much money per student as the least impoverished systems. Applications from high-poverty districts were lower than others in the first year of the program but increased in the second year.

Larger districts, schools, and libraries also are more likely to apply for e-rate funds, according to the study. But no significant difference was found in the level of per-student funding in urban and rural districts that had high poverty levels.

The highest amount of per-capita funding went to states and territories such as Alaska, Kentucky, Puerto Rico, Mississippi, New Mexico, and the District of Columbia, due to the e-rate funding formula, which provides more funds for high-poverty and rural schools and libraries, the report notes.

The number of applications also has grown each year, according to Melvin Blackwell, vice president for external communications for the Schools and Libraries Division of the Universal Service Administrative Corporation. The Schools and Libraries Division administers the e-rate program under the direction of the Federal Communications Commission. For 2000-2001, 36,000 applications were received, up from 30,000 for 1999-2000, and grants totaling $2.085 billion were awarded this year, compared with $1.9 billion the prior year, Blackwell told Education World.


That does not mean there still is not work to be done, Roberts said. Among the issues under review are how to provide more money to schools for internal wiring and ways to reach out to states with lower participation rates.

"There still are a few critical challenges," Roberts told Education World. "There still are a lot of schools whose requests for inside wiring could not be met."

One of the report findings is that some of the poorest school districts are not participating to the extent that administrators expected, Puma said. But that often is due to lack of funds and personnel in the districts to file the applications, he explained.

The FCC also may have to review and revise its funding cap, according to Roberts. The FCC set a spending limit of $2.25 billion a year, and in 1999-2000, requests for funding exceeded $4.6 billion.

"The cap was based on an initial analysis of potential costs," said Roberts. "We didn't anticipate how rapidly the demand for increased capacity would proceed in schools."

Though it is true that some of the poorest schools still do not have the resources to apply to the program, indications are that the e-rate funds for the most part are reaching their intended audience, Blackwell added.

Ellen R. Delisio
Education World®
Copyright © 2000 Education World

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