Education official: E-rate must survive

It's not enough that Congress, presidential hopefuls, high-tech CEOs, and parents want schools and libraries plugged into the Net.

Aside from the logistics of ripping out walls, rewiring archaic campuses, and networking classroom computers, the push to raise tech-savvy children is complicated by other factors: namely, politics.

All sides agree that all citizens, including children, should be going online to

Linda Roberts

reap economic and social rewards that come from gaining access to information and to develop better technological skills. They also agree that there is no substitute for equal access to technology for all.

But they are far from coming to a consensus on how this should be done and who should pay for the costs associated with such an ambitious program.

The result has been political infighting among the basic factions that makes President Clinton's goal of getting all K-12 classrooms online by the year 2000 all the more challenging.

The White House solution to end the so-called digital divide between technology haves and have-nots is centered on the e-rate, a discount set up by the Federal Communications Commission. The e-rate aims to decrease Net access costs for schools and libraries, and subsidize up to 90 percent of the cost for the poorest facilities.

This fall the FCC has promised to dole out $1.275 billion in discounts, 43 percent less than what it originally slated for the program. The e-rate is funded by about 19 cents on every dollar for universal service, the nation's historic program to afford access to telecommunications--and now Net access--for everyone.

But the FCC's administration of the e-rate is under fire by some members of Congress and the long distance companies that contribute the most to universal service through fees paid to local phone companies (a cost that is ultimately passed down to telephone users). And foes have nicknamed the e-rate the "Gore Tax," after the vice president, a strong advocate of the program.

In light of this, the administration has kicked into high gear to keep the e-rate afloat and quell criticism of the program.

CNET News.com talked with the director of the Education Department's Office of Technology, Linda Roberts, this week about why children need to get online, the perils facing the e-rate program, and how this is one policy debate the White House can't afford to lose.

News.com: Why do schoolchildren need to use the Net?
Linda Roberts: The simple answer is, technology is a new basic for our kids. It is a tool for the 21st century. We can't contemplate preparing our kids for the world they are going to face without a focus on these new skills, along with, of course, a focus on the basics--reading, mathematics, and the sciences. We need to make sure that all of our students have access to them.

How does the e-rate help close the digital divide?
We just recently have new evidence [from the Commerce Department] that the digital divide is growing in this country--it's not lessening. Kids from rich families and well-educated families are ten times more likely to have access to computers and to networking resources at home than kids who are from poor homes with parents who have less education.

Education Department's Linda Roberts on closing the digital divide

Therefore, it becomes more compelling that we make sure that all schools and public libraries have access to these tools and have them available to students. That is whey the e-rate is so important. The e-rate specifically gets at the digital divide because the highest rates of discounts go to the poorest and most rural schools in the country.

The FCC was mandated by Congress under the Telecommunications Act of 1996 to increase school and library access to the Net. So why is its plan facing so much criticism?
The e-rate has been caught in the middle of a political battle over the administration of the program and collection of funds from long distance companies.

Much of the debate is being driven by politics, and I think that is really unfortunate. This is not the time to take the important needs that schools have and turn it into a political argument. There is no question in my mind that the e-rate has been caught in a much larger set of complicated issues around the changes in the Telecommunications Act. This argument is not between education and telecommunications. It is a set of issues between the long distance carriers and local carriers and changes in the whole telecommunications arena.

My sense is that the FCC has made important changes in the program to make sure the questions and problems around the cost of the administration, they've consolidated the program, and I think they have fixed the problems. Congress at this point needs to be supportive, not an obstacle to moving forward. The vast majority of members of the House and the Senate are fully behind the program as it now exists.

Speaker of the House Newt Gingrich wants the e-rate program changed to a block grant system, in which states get a chunk of money and then dole the funds out to schools. Sen. Conrad Burns (R-Montana) and Rep. Billy Tauzin (R-Louisiana) introduced legislation to fund school and library Net access using 1 percent of the current 3 percent excise tax on phone service that goes into the nation's general fund. The remaining 2 percent of the tax would be cut. What do you think about the competing proposals to change the way schools and libraries get funds for Net access and internal wiring?
First of all, what [they are] proposing is a tax on people's phone bills. It would pay for the program with a tax on everybody's phone bill, without eliminating the existing charges long distance carriers have added for universal service. Quite frankly, the beauty of the U.S. fund is that it has been more than offset by the $3 billion in access charge reductions that long distance companies pay to local [phone] companies. The universal service fund is not a tax because it is collected and dispersed within the same context of service. I don't think a new tax is workable.

Education Department's Linda Roberts on how block grants will not work

The second problem I have is the block grant. I really think the FCC joint board of state and federal regulators made an incredible decision that said, 'No matter where you live in this country, if you are poor, if you are a school district or library in a poor community, we are really going to try to level the playing field for you.' The problem with a block grant is that individual states may not make the same kinds of distribution decisions that the FCC made. And quite frankly, the block grant will severely penalize the small, rural states. If it is allocated the way most block grants are allocated, they will be allocated on the basis of population. This is where the rural states will get hurt tremendously.

I'm not sure that the block grants will go to the very specific focused subsidies that the universal service fund, the e-rate, provides. The e-rate really is about universal service. If you have block grants, the private schools would be left out of the mix completely.

The FCC just made clear in June that only the poorest schools and libraries will get funding for internal wiring, but thousands of others spent time and resources to apply for this type of funding and now may not get it. How does the e-rate application process need to change to avoid this confusing and painstaking process for schools?
It won't happen in the first year. The poor schools get the first internal wiring discounts. But we would hope in the second, third, fourth, and fifth years, that those internal wiring costs would be moved down, that the next level of schools that are eligible for discounts would be eligible for the inside wiring.

Once you do the inside wiring, you don't have to do it again. Another way to fix it would be to increase the size of the e-rate fund. The FCC put a cap of $2.25 billion on the fund. In the first year of operation, the actual operation amount is half of that. So you could seen an increase in the fund.

I would argue to the phone companies, who have been the most adamant about reducing the size of the fund, that they are cutting their own noses in the long run. As we wire the schools, the market for services will increase and grow, so the revenues of the telecommunications industry are likely to expand over time. Those increased revenues could more than again pay for increases in the e-rate fund.

How important is it politically to keep the e-rate alive in its current form?
The needs of our kids are being sacrificed to political considerations. Outside of Washington the people get it. We've got to get the e-rate into the schools come this September because the schools are ready. We've got to make this happen.

Education Department's Linda Roberts on putting the e-rate to work

This is one of the most important educational decisions that Congress made. The irony is that it occurred in the context of the passage of the Telecommunications Act, and it is an act that took 50 years to get. One of the major provisions in the 1930s act was the universal service provision. Now we have a change to bring universal service into the 21st century, and help to erase this growing disparity. If we don't do it now, we will never do it.