A Simple Introduction to the USAC E-rate Program

Kids in the libraryIn 1996, the US Congress passed the Telecommunications Act.  In it, Congress directed the Federal Communications Commission to establish a method for supporting the delivery of telecommunications and technology to elementary and secondary schools and libraries.  The FCC in turn established the Universal Service Administrative Company to oversee the program and the disbursement of funding. E-rate is the commonly used name for the Schools and Libraries Program of the Universal Service Fund, which is administered by the Universal Service Administrative Company (USAC) under the direction of the Federal Communications Commission (FCC). The program provides discounts to assist schools and libraries in the United States to obtain affordable telecommunications and Internet access. It is one of four support programs funded through a Universal Service fee charged to companies that provide interstate and/or international telecommunications services.

The Schools and Libraries Program supports connectivity – the conduit or pipeline for communications using telecommunications services and/or the Internet. Funding is requested under four categories of service: telecommunications services, Internet access, internal connections, and basic maintenance of internal connections. Discounts for support depend on the level of poverty and the urban/rural status of the population served and range from 20% to 90% of the costs of eligible services.

“The Schools and Libraries (E-rate) Program connects our country’s schools and libraries to broadband and provides a discount on high-speed Internet access, telecommunications services, and equipment” – FCC/USAC


What is USAC?

Each year, the E-rate Program provides $3.9B in funding to schools and libraries for broadband and telecommunications access. USAC is the organization designated by the FCC who manages the E-rate Program much like the IRS manages the funding collection and audit for all business and personal taxes in the U.S.

With the Telecommunications Act of 1996 Congress directed the FCC to “establish competitively neutral rules…’ to enhance, to the extent technically feasible and economically reasonable, access to advance telecommunications and information services for all public and non-profit elementary and secondary school classrooms…and libraries.’ ” USAC was developed to act as the neutral subsidiary by Congress, ensuring the FCC’s rules and regulations were being administered and managed properly. 

As stated above, this program allows schools and libraries funding to support networking infrastructure platforms. Discounts range from 20% to 90% for Category One and 20% to 85% for Category Two solutions.  Budgets are based on the number of students for schools or the square footage for libraries.


Applicant Eligibility

Below are the eligible categories.

The discount rate for the level of funding eligible depends on three things: 

  • Poverty level of your school/school district; measured by the “free school and lunch program” eligibility
  • Urban or rural status
  • What category of service you’re requesting (see below for categories description)

When moving in the direction in which you as an applicant are ready to participate in the program, you will need to know the deadlines and all the eligible services for these categories.

Category One services are data transmission services, internet access, and voice services (Funding provided for each year)

Category Two services are internal connections, managed internal broadband services, and basic maintenance of internal connections (Funding provided for a five-year period & budget limit on funding amount)

Eligible Services:

Many commercially available Internet access and data transmission services are eligible for discounts, as is some equipment that allows access to these services. The Eligible Services Overview will give you a general understanding of eligible products and services. You should also review the Eligible Services List (ESL) for the appropriate funding year because the entries in this list, and their eligibility, can change from year to year. Some products and services can be partially or conditionally eligible for discounts.


Process Overview

Here is a process overview for service providers. These steps will take you through the applicant Schools and Libraries Program process and provide you with everything you need to know along the way.

Filing and Getting Started Begins with EPC

To apply for E-rate Program funding you will need access to your organization’s account in the E-rate Productivity Center (EPC), the online portal for creating and managing your application, and communicating with USAC.

If your school/library has applied for E-rate Program funding before, it probably has an EPC account already, including an “account administrator” who can add you as a user (more on this below).

Find the “Account Administrator” and Activate the Account

The assigned “account administrator” in EPC is most likely the person who certified last year’s FCC Form 471 (usually a superintendent, CFO, etc. of your organization). If you are not the account admin, they’ll need to log in to EPC to add you as a user.

Account administrators can activate their account by visiting the EPC login page and selecting “reset your password” (their email address is the user name). Once they’re logged in, they can add new users, or assign a new person to be the account administrator.


The Applicant Steps & Additional Resources from USAC

Before You Begin
Step 1 Competitive Bidding
Step 2 Selecting Service Providers
Step 3 Applying for Discounts
Step 4 Application Review
Step 5 Starting Services
Step 6 Invoicing 


Knowledgeable E-rate Service Provider

This program can be complicated, that is why it most important as an applicant to work with an organization who understands the rules of engagement for 100% compliance with the program’s regulations.

2NDGEAR has been an E-rate Service Provider (SPIN 143044100) since 2015.  We have a dedicated staff that supports our clients (applicants) throughout all steps of the E-rate Program season. If you have any questions or are in the need of an experienced E-rate Service Provider, reach out to govcontracts@2NDGEAR.com.


Excellent Resources:




Leave a reply