E-Rate Overhaul Escapes GOP Lawmaker Attacks, But Only for Now

Wheeler’s initial E-rate proposal “really seems to have neutralized the logical opponents on Capitol Hill,” namely congressional Republicans, said Jim Smith, a former Comptel president and attorney with Davis Wright who has represented telecom and cable operator clients in E-rate healthcare and low-income universal service matters. The E-rate plan seems to focus more on Wi-Fi, ignoring “contentious” questions of E-rate fund size, Smith said. “It could be a hot political football from the Hill, especially if the House Republicans [fixate on the possible] E-rate expansion that raises the contribution level.” Smith suggested concerns would come from Democrats confused that Wheeler is not addressing all the goals of President Barack Obama’s ConnectED initiative. “It’s politically smart, it’s politically canny” now, but the full ConnectED proposal “certainly would cost more money,” which whenever that later FCC implementation occurs will provoke Republican rhetoric and hearings, he said.

The 2014 midterm elections likely heighten the politics, said American Association of School Administrators Associate Executive Director Noelle Ellerson. Expect more moderation following those, she said, saying E-rate partisanship “depends on if it’s an election year or not.” A different lobbyist following E-rate agreed that the November elections dictate the proposal’s limited contents -- it’s a political calculation, she said, calling a contribution rate hike and fund size the “sticky wicket” in all discussions. Privately, stakeholders debate whether to fight for everything in E-rate overhaul now or accept the step-by-step process that the FCC seems to be pursuing, which would involve taking up the other ConnectED E-rate overhaul elements after the elections, the lobbyist said.

Republicans Watching

Republican criticism has been limited. House Communications Subcommittee Chairman Greg Walden, R-Ore., in June emphasized the need for “tangible results for our students and efficient use of ratepayer resources” (http://1.usa.gov/1jZFIi1), saying Wheeler’s plan “appropriately reflects the advice of the committee to pursue improvements to the E-Rate program within its current funding.” House Commerce Committee Republicans are watching this week’s vote but maintain focus on USF overall, a committee aide told us. Members want to get the necessary technology into the hands of educators and students but also believe this can be done within the $9 billion annual USF budget, the aide said. He cited a letter House and Senate Republicans sent Wheeler urging fiscal responsibility and to refer any plan to the Federal-State Joint Board on Universal Service, a hope that endures now, the aide said. Joint Board referral “could be seen as a way to kill or delay E-rate reform,” Smith said, also saying the Republican statement makes sense: There’s “not much else to say” about Wheeler’s item, he said.

The American Library Association “hopes this will not become more politified than it should be,” said Director-Government Relations Lynne Bradley, calling it a typically bipartisan program. Many Hill offices are watching and not weighing in loudly yet, she said. Raising the contribution rate “will be very political” when and if it happens, and the need for raising it has been “thoroughly demonstrated,” she said. Of Wheeler’s current item, she said, “I call it ‘keeping the powder dry for now.'”

E-rate beneficiary stakeholders see Senate Commerce Committee Chairman Jay Rockefeller, D-W.Va., and Sen. Ed Markey, D-Mass., as key voices to watch, lobbyists told us, also flagging Sen. Chuck Schumer, D-N.Y., and House Communications Subcommittee ranking member Anna Eshoo, D-Calif., as engaged on E-rate. In Q1, the National Education Association spent $645,531 on lobbying, employing multiple lobbying firms. The American Federation of Teachers spent $267,338. The American Library Association spent $48,114, with $20,000 going to the Penn Hill Group firm, the American Association of School Administrators $100,000 and McGraw-Hill Global Education Holdings $115,000.

Rockefeller and Markey tore into the proposal on several fronts in a three-page joint letter to Wheeler sent Tuesday. “It would be ill-advised to guarantee a permanent set-aside for Wi-Fi, if that set-aside could end up cannibalizing funding for basic Internet connectivity,” they said. They're also “opposed to the use of such per student or square foot funding models for Wi-Fi,” they said. “The permanent funding cap for the E-rate program needs to be raised. Because of its success, the E-rate program has not been able to keep up with the overwhelming needs of schools and libraries.” The two lawmakers call it “unfortunate” that Wheeler’s proposal “does not appear to address permanent funding changes to put the E-rate program on a solid financial foundation for the future.” The FCC declined comment.

Markey also fired off a letter to Wheeler last week. He said “small, cramped, crowded buildings often require more spending for wireless connectivity per square foot than uncrowded buildings.” Rockefeller “is keenly aware of the valid concerns raised by the education community” and “expects the FCC to give full and fair consideration to the education community’s views since they are on the front lines of the program,” a committee aide said. Any changes to E-rate should not “undermine the successful structure of the program that has served our nation’s students and library patrons so well for nearly two decades,” the aide said, flagging Rockefeller’s history of agreeing with schools and libraries’ E-rate priorities.

'Deep Concerns’

Markey’s first letter echoes many education group sentiments, with a focus on equity and the historical success of E-rate in its stated purpose of expanding and the need to ensure access to connectivity, Ellerson told us. Markey “honed in” on a very specific issue to his constituents, she said. Any input from the Hill carries “a lot of voice, a lot of weight,” she remarked. Rockefeller always puts the needs of educators and beneficiaries first, said National Education Association Director-Government Relations Mary Kusler. She dismissed the idea that there’s much substantial communication on E-rate from the agency to Hill offices: “There’s absolutely none whatsoever.” NEA has been “watching and talking with our friends on Capitol Hill throughout the entire process,” said Kusler.

Ellerson and Kusler sent a note to all Hill offices last week sounding the alarm, according to Ellerson. “As the FCC moves toward its July 11 vote on proposed changes to the E-Rate program, we write to share a set of responses from more than 20 national education and rural education groups,” the email blast to congressional offices said. “These responses highlight the deep concerns of education groups -- representing the large majority of the program’s beneficiaries -- as it relates to the proposed changes. ... We share these resources in the hopes that your boss will see how the proposed changes don’t work for the nation’s schools and the students they serve.” The note was a “shade short” of outright opposition, Ellerson said.

Several dozen House lawmakers from both parties, including 38 members of the New Democrat Coalition, sent the FCC a letter (http://1.usa.gov/1mw8Y40) earlier this year urging a focus on “broadband services, Wi-Fi updates, and filling the infrastructure gap, with continued support for connectivity services.” It should emphasize transparency, accountability and funding stability, with a streamlined application process, the group said. The New Democrats are “monitoring the vote closely,” an ongoing “top priority,” an aide said this week. Republican FCC Commissioner Ajit Pai has also spent months laying out his E-rate vision in op-eds with various conservative lawmakers, such as Sens. Kelly Ayotte, R-N.H., (http://bit.ly/1tk9ZRV) and Jerry Moran, R-Kansas (http://bit.ly/TTGiH5).

Any Hill attention “is just upping the pressure right now,” Kusler said, calling the timing especially appropriate considering Rockefeller’s plans to retire at the end of this term. E-rate “is one of his crowning moments, this is one of his legacies,” she said.