Created as a part of the Telecommunications Act of 1996, the E-rate program provides approximately $2.3 billion annually in discounts on certain products and services that are essential for classrooms and libraries to receive voice, video, and data communications--less than half of the total requested amount for 2012.
The entity that oversees E-rate--the Universal Service Administrative Company (USAC)--reports that program demand grew nearly 22% in FY12:
On April 20, 2012, USAC sent a letter to Sharon Gillett, Chief of the Wireline Competition Bureau, providing USAC's estimate of demand for Schools and Libraries Universal Service Support Mechanism discounts for FY12. USAC said the estimate is $5.237 billion, and is based on total funds requested in 46,838 FCC Form 471 applications received by March 20, 2012, the close of the FCC Form 471 filing window. USAC also provided a table showing demand by service type and discount band.
The requested amount marks the second in the 15-year history of the E-rate program that applicant demand has exceeded the $5 billion threshold.