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Summary:
Under language enacted in the Telecommunications Act of 1996 (P.L. 104-104),
a discount on telecommunications services was implemented for schools and libraries
as part of the universal service framework. Universal service seeks to ensure the
availability of telecommunications services for all consumers, including low-income
consumers as well as those in rural and high-cost areas.
The universal service discount for schools and libraries, known as the E-rate
program, is now in its sixth award cycle. The E-rate program has an annual budget
cap of $2.25 billion - although the FCC has recently ruled that unused funds can be
carried over for usage in subsequent years. Although the future of E-rate is not as
questionable as in its earlier years, some Members of Congress continue to question
the utility of the program, and instances of fraud and abuse in the program have been
reported.
This report provides background information on the E-rate program, focusing
specifically on its support of schools. It will be revised to reflect any substantive
changes in the program. For legislative activity see CRS Issue Brief IB98040,
Telecommunications Discounts for Schools and Libraries: The "E-Rate" Program
and Controversies.
