Maine, West Virginia Get Windfall from Broadband Fund

Published May 31, 2016

The Federal Communications Commission recently increased the E-Rate fund by $22.5 million for 2011. The Schools and Libraries Program of the Universal Service Fund, commonly known as E-Rate,  provides discounts to assist most schools and libraries in the United States to obtain affordable telecommunications and Internet access. It’s administered by the Universal Service Administrative Company (USAC) under the direction of the FCC.

This new expansion of funds comes at a time when state local governments across the nation are suffering from severe budget deficits and Internet access is already widely available through numerous sources and access costs are falling rather than rising.

U.S. Senators Jay Rockefeller (D-WV) and Olympia Snowe (R-ME) wrote the provision establishing the E-Rate program as part of the 1996 Telecommunications Act, and their states are among the main recipients of the funds.

‘Program Needs Revisit’
West Virginia has received more than $130 million in E-Rate awards since Rockefeller and Snowe created the program through an amendment to the 1996 Telecommunications Act—and more than $18 million just this year. Maine has received more than $80 million since the program’s inception.

“Maine and West Virginia are rural states, and in situations like this, funds tend to get tipped to the states with the most powerful senators,” said Steve Titch, a telecom policy analyst for the Los Angeles-based Reason Foundation.

But although some of these funds may have made sense when the Telecommunications Act was authored more than 14 years ago, when broadband access was scarce, particularly in rural areas, such is no longer the case, Titch says.

“The program needs to be revisited,” he said. “Getting broadband to libraries and schools is not as expensive as it was when it was first being deployed. There’s a lot of competition. The price isn’t at the whim of a monopoly provider.”

‘Waste of Money’
Titch noted libraries do fine without federal funding for water, electricity, staff salaries, and other necessities of delivering their services. Internet access should be considered in the same way, he says: “You don’t need a federal program for this.”

“It’s an outrageous waste of money and more pork Snowe should not be getting,” said Andrew Ian Dodge, Maine coordinator for Tea Party Patriots. “Most areas of Maine have access to cheap broadband. Never mind that government shouldn’t be meddling in the first place.”

Titch noted content providers on the Internet provide downloads at low cost or for free, which could save libraries some money once they have access, with some electronic content replacing more expensive print content. That further undermines the case for the subsidies, he said.

Another strategy being used with success is the privatization of library services, Titch says. Such a change would enable the private library services providers to work out the best mix of Internet access and other services.

Phil Britt
([email protected]) writes from South Holland, Illinois.