E-Rate 101

A Primer for Administrators

Frequently Asked


E-rate is a government program that provides discounts to help most schools and libraries in the United States to obtain an affordable telecommunication and Internet access. The program includes three service categories:  Telecommunication services, Internet access, and Internal connections of equipment.

All public elementary, secondary schools and public libraries in the U.S. are eligible for e-rate discounts.  Private schools also qualify for discounts, if they operate as non-profit and do not have endowments exceeding $50 million.  Institutions of higher education are not eligible.

Costs associated with individual computers, content-related software, and teacher training are not eligible for E-rate discounts, unless used as file servers.

At the current time, the FCC plans on continuing E-Rate funding indefinitely.  But, telecommunication service providers are being charged a monthly surcharge that will fund the E-Rate Program.

Through the Federal Communication Commission's e-rate program, schools and libraries can receive discounts from vendors on the cost of eligible telecommunications services, Internet access, and internal connections (the equipment needed to deliver these services). The discounts range from 20 to 90 percent, with higher discounts given to applicants in low-income and rural areas. The Universal Service Administrative Company's (USAC's) Schools and Libraries Division (SLD) is responsible for carrying out the program's day-to-day operations. To obtain e-rate support, eligible schools and libraries must submit an application to SLD specifying the services they wish to purchase, how much discount funding they would need, and the vendors they have selected to provide the services.

Alphabet Soup of

E-Rate Acronyms

History of E-Rate

On February 8, 1996 President Clinton signed the Telecommunications Act of 1996. The universal service section of this law, Section 254, is intended to help schools and libraries obtain access to state of the art services and technologies at discounted rates. The law requires that the FCC and the states base the revision of the universal service system on seven principles, including the principle that elementary and secondary schools, libraries, and health care providers should have access to advanced telecommunications services.

The Snow-Rockefeller-Exon-Kerry Amendment specifies that, upon request, individual telecommunications carriers must provide service to schools and libraries at "affordable" rates. The amount of the associated discount is to be reimbursed by the newly established universal service system that is required by the 1996 Act.

The provisions of the Telecom Act were implemented May 6, 1997.  Schools are required to have Children’s Internet Protection compliance procedures in place in order to receive any reimbursement money.

Links to Important Resources


This is a basic introduction page to the program, created by the company that ensures schools receive their discount.


This site, created by the Federal Communications Commission, offers historical information on e-rate, as well as links to other sites of interest.


The E-Rate Central site focuses on providing “consulting, compliance, and forms processing services to E-rate applicants and service providers.”


This site, from the U.S. Department of Education, offers a variety of information about the E-Rate program.


This site offers assistance to anyone interested in applying for E-Rate. 


This site, from the North Carolina Department of Public Instruction, offers a variety of resources about E-Rate, especially as it applies to schools in North Carolina.


This site, created by the American Library Association, offers an explanation of E-Rate, as well as news updates from 2006.  


This is an E-rate FAQ, created by the Tandberg Corporation.


The Education and Library Networks Coalition created this list of frequently asked questions about E-Rate.

Planning for E-Rate Reimbursements

E-rate provides the necessary forms, instructions, checklists, and guidance to help schools and libraries become eligible for the reimbursement.  Schools and libraries that plan to participate must follow the following application process.

1.  Develop a Technology Plan.

2.  Submit FCC Form 470 (Description of Services and Certification Form)

3.  Provide for a 28-day competitive bidding period.

4.  Select a service provider/sign a contract.

5.  Submit FCC Form 471 (Services Ordered and Certification Form)

6.  Be prepared to answer questions on your application.

7.  Receive and review your Form 471 (Receipt Acknowledgment Letter)

8.  Receive your Funding Commitment Decision Letter.

9.  Assure technology plan approval; receive services; file Form 486 (Receipt of Service Confirmation Form)

10. Retain records.

11. Should you disagree with the SLD decision you may file an Appeal.

12. The provider will be notified by the SLD of your discount rate.  You should be billed only the remaining amount, so you must pay your share of the bill.  Prepare for the next funding year.

Schools and libraries should plan in advance so they can meet the required deadline dates.  The forms mentioned above can be found at


Eligible and Ineligible Services

Eligible Services
Ineligible Services

Basic phone service, which includes local and long distance (toll) service

Leased data circuits

T-1, 56K, ISDN linrd

Dial-up Internet connections



Online content

Professional Development training

Selected software

Demographic Criteria/Discount

INCOME Measured by % of students eligible for the National School Lunch Program URBAN LOCATION

E-Rate Discount

E-Rate Discount
If the percentage of students in the school qualifying for the National School Lunch Program is... ..and the school is in an URBAN area, the E-rate discount will be.. ..and the school is in a RURAL area, the E-rate discount will be...
Less than 1% 20% 25%
1% to 19% 40% 50%
20% to 34% 50% 60%
35% to 49% 60% 70%
50% to 74% 80% 80%
75% to 100% 90% 90%



Bailey, G. & Frazier, M. (2004). The technology coordinator’s handbook. International Society for Technology in Education  .

Gunter, G. & Gunter, R. (Mar-Apr 1998). Making the most of e-rate for your school,  Multi-Media Schools 5(2).42-45.

USAC Schools and Libraries E-rate Site (2006). Retrieved from http://www.sl.universalservice.org on June 7, 2006.

Tables provided by U.S. Department of Education, Office of Innovation and Improvement , Office of Non-Public Education (ONPE) (2006).

Contact Us

Ren Bryan

Sophronia Cherry

Jessica Mangum

Tammy Taylor

Unit V. Funding for Technology

Submitted to Instructor Mrs. E.E. Dodson

East Carolina University

in partial fulfillment of the requirements

for EDTC 6140

 Planning for Technology

June 13, 2006