Application_Scrabble_CDE_2016-04-28As schools and libraries plan their E-rate strategies under the new rules of E-rate 2.0, they can no longer take each year’s application request as a stand-alone, but must plan out their requests as part of a five-year, Category 2 strategy. And that strategy has to take into consideration five-year overall dollar caps on a mix of internal connections, managed internal broadband services and basic maintenance. They also must consider whether to use E-rate money to replace current voice services because discounts for voice services will continue to be reduced 20 percent per year until they are phased out in three years.

Let’s take a look at what the $150 per student, five-year budget means.

All schools, regardless of their discount levels, calculate their Category 2 budgets the same way. They must calculate their student populations based on the total number of students who may use the services at a given time. To do this, schools take their total number of full-time students and add the number of part-time students who attend the school regularly and concurrently. This answer determines the total number of students to use as the student multiplier, which is then multiplied by $150 to establish the total five-year, Category 2 budget for the school. The E-rate discount is calculated off of this budget number. Because no school district can qualify for more than an 85 percent discount in Category 2, the highest Category 2 E-rate discount to a school cannot exceed $127.50 per student over five years.

Since this is year two of E-rate 2.0, this is the first year Category 2 requests will look back at what was spent with Fiscal 2015 E-rate money. Schools and libraries must identify and consider how much money is still left in their five-year, Category 2 budget when they submit their Form 471 applications. An applicant can find the Category 2 Fiscal 2015 E-rate funding amount online at the Universal Service Administrative Company Category Two Budget Tool site. If the applicant is still waiting for Fiscal 2015 funding, the Schools and Libraries Program will consider the amount remaining after the adjudication of the Fiscal 2015 request.

This brings up a question: If the applicant requests more money than it has available in its-five year allotment, will the Form 471 request be denied? The answer is no, it will not. It merely would require the school or library to provide the difference with its own money.

Another consideration might be that a school or library has changed its mind about deploying some technology or services it was granted funding for in Fiscal 2015. Can the applicant request that those dollars be applied to new purchases in Fiscal 2016 instead? Yes, they can. The applicant would need to file a Form 500 stating the nature and reason for the change. Those dollars would then be freed up for future purchases.

Yet another consideration is that some school districts or consortia of schools or libraries may apply for Category 2 funding. At the same time, individual schools and libraries can apply for their own funding. Since all dollars are allocated by student or patron calculations, these parties must share the five-year Category 2 budget limits. If this is the case, it is important that all applicants are on the same page so budget dollars aren’t requested twice.