The USAC E-rate News Brief released September 21, 2023 explained the following program updates for FY2024 for all applicants.
Cost Allocations The FCC provided guidance on a number of cost-allocation calculation issues that applicants find challenging such as allocations to exclude costs associated with minimal ineligible use or service components. For all schools and libraries:
- If at least 90% of an applicant’s requested Internet service is being used for eligible purposes, the remaining ineligible use (e.g., occasional office use) of the Internet service will be presumed to be ancillary and cost allocation is not required.
- Expenses associated with cabling (“drops” or “jacks”) that is primarily being used to provide broadband connectivity within schools and libraries does not require cost allocation, provided it is the most cost-effective means of receiving the eligible service. The eligibility determination should be based on the purposes of the network as a whole if the network is primarily serving an eligible purpose (i.e., distributing broadband throughout a school or library building).
- For non-instructional facilities (NIFs), including library administrative buildings, that share equipment (e.g., a district switch) with a school or library, the applicant does not need to cost allocate for the NIF’s use if it is choosing the most cost-effective offering for the shared equipment.
Urban/Rural Designation Update The Urban or Rural Status of an entity (school or library) in the E-Rate program is guided by the U.S. Census Bureau’s delineation. FCC rules require USAC to use the Census Bureau’s most recent rural-urban classification. For FY2023, this was based on 2010 Census data. USAC is in the process of updating the urban-rural classifications for FY2024 based on 2020 Census data. After USAC updates the rural-urban classifications using the 2020 Census data, a small percentage of applicants may notice that their urban/rural designation has changed. We will provide more information in the next issue of the News Brief