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Tech Industry

FCC votes to revamp E-rate program

New rules aim to prevent fraud and abuse of an embattled federal fund for connecting schools and libraries to the Internet.

The U.S. Federal Communications Commission said Wednesday that it has set new rules for an embattled federal fund intended to bring Internet connections to the nation's schools and libraries.

The rules aim to shield the so-called E-rate fund from fraud and abuse, the FCC wrote in a release published on its Web site.

Among other things, new eligibility rules bar individuals, for three years or longer, from participating in the program if convicted of a criminal offense or found civilly liable for misconduct in relation to the program.

Also on Wednesday, the FCC revised the E-rate rules to include not only Internet connections, but also voicemail and wireless services--a step the agency said will ease administrative costs. In addition, the FCC said it will develop an online list of approved equipment to facilitate funding requests.

Educators credit E-rate with bringing Internet connections to some 99 percent of the public K-12 schools in the United States during the past few years. Still, the program has faced persistent criticisms, ranging from antitax objections to allegations of contractor fraud and faulty bookkeeping.

Last month, the House Committee on Energy and Commerce asked for detailed information about the management, funding and oversight of the program.

Created as part of the Telecommunications Act of 1996, the E-rate program relies on taxes levied on Americans' telephone bills. According to the FCC, E-rate has dispensed some $9.8 billion since the fund was created.