Tag: "e-rate"

Posted November 17, 2016 by lgonzalez

The Missoula County Public Schools (MCPS) plans to save $150,000 per year by investing in its own fiber infrastructure. Over a 20-year period school officials expect to save approximately $3 million.

Fiber For Education And Savings

MCPS will be the first in the state to self-provision its wide area network (WAN), the connections between district facilities. Right now, the school pays approximately $287,000 per year to lease its WAN connections and for Internet access; about $200,000 of that figure is dedicated to leasing the WAN.

School officials were already leasing lit fiber service when they began investigating options to compare cost and service. They also looked at leasing dark fiber, which would mean they would need to maintain the equipment to light the fiber themselves, and investing in an Indefeasible Right of Use (IRU). The IRU would give the school district the ability to use a designated number of fiber strands to use as they wished for a fixed period of time. 

As other school districts around the country are discovering, the best choice for them was to own the infrastructure and control it themselves:

"We're saving the district $3 million over the next 20 years in the general fund that will be able to be allocated to other things," Littman said of self-provisioned fiber. "It's more than $3 million, actually. The reason we say we'll only end up saving the general fund $3 million in the end is because we do have some annual maintenance costs to incur to protect the fiber."

Leasing lit fiber for the speeds MCPS needs would have cost $1.5 million to $3.1 million for only a five-year contract. A dark fiber 10-year contract would have cost about $3 million.

Right now, the school pays approximately $287,000 per year to lease its WAN connections and for Internet access; about $200,000 of that figure is dedicated to leasing the WAN. The school will still need to contract for Internet access from an Internet Service Provider (ISP).

Lake Oswego School District in Oregon recently discovered the cost benefits from ownership, when they discovered they would pay 89 percent less by self-provisioning than by leasing from Comcast. School districts sometimes partner with municipalities and integrate school fiber assets for larger municipal fiber projects, as... Read more

Posted August 31, 2016 by lgonzalez

In late July, the FCC released a Notice of Apparent Liability (NAL) in which it found the telecommunications giant AT&T Southeast liable for a $106,425 forfeiture. The agency also ordered the company to return $63,760 of E-rate funds it described as “improperly disbursed.” AT&T overcharged two school districts in Florida and, in a response released last week, are trying to justify their pilfer by blaming the E-rate rules and the schools themselves, much as a criminal blames victims for being such easy targets.

Funded By Phone Users

E-rate funds are collected as a surcharge on telephone bills; the funds go to schools to help pay for telecommunications costs at schools, including telephone, Internet access, and infrastructure costs like fiber network construction. The amount a school district receives depends on the number of students in the district that qualify for free and reduced lunches; schools with higher numbers of low-income students are reimbursed at a higher rate. Given that many of our schools are funded through property tax rolls, this means that schools in poorer neighborhoods that are more likely to need help with their budgets receive the higher reimbursement rates.

According to the program rules, phone companies and Internet Service Providers (ISPs) that participate are required to offer the “lowest corresponding price” to schools. Providers aren’t permitted to charge rates that exceed the “lowest corresponding price” or bid higher than that price on contracts to serve similarly situated entities if those entities are eligible to receive E-rate funds. School districts do not carry the burden of getting the lowest corresponding price - telephone and Internet access providers are responsible to ensure that they offer the lowest price in exchange for the opportunity to participate in the program. Between July 2012 and June 2015 alone, AT&T received $1.23 billion in E-rate funding nationwide.

Filching In Florida

In Orange County and Dixie County, AT&T charged the districts prices that were 400 percent higher than other phone rates in Florida, claims the FCC. Their investigation focused only on two types of telephone services. The FCC noted that when Florida deregulated phone services in 2011, AT&T “dramatically increase[d] its pricing.” According to the the NAL,... Read more

Posted August 16, 2016 by lgonzalez

Lake Oswego School District (LOSD) in Oregon is set to make an investment that will save up to $301,000 per year in telecommunications costs - its own dark fiber network.

To Lease Or To Own? There Is No Question!

LOSD is the latest in a string of local schools that have chosen to invest in fiber infrastructure for long-term savings. Caswell County, North Carolina, is also investing in dark fiber with an eye on the future. Because the school district will own the network, they will no longer be surprised by unexpected rate hikes, making budgeting easier. The money they save can be directed toward other programs and, because it is dark fiber, they are only restricted by the equipment they install and the bandwidth agreements they enter into with Internet Service Providers (ISPs). Some schools choose to become ISPs themselves or join collaborations in which they can purchase bandwidth collectively to save even more. 

According to Joe Forelock, the district’s assistant superintendent for academic and student services, “This is a long-term investment for the health of the district over the next many, many years.” Once the network is in place, it will cost approximately $36,720 annually to maintain it, which is 89 percent less than what Comcast plans to charge LOSD for the 2016 - 2017 school year. 

We want to note that Comcast tripled their rates from the 2015 - 16 school year, in part because the 2016 - 17 contract was only for a year while the dark fiber network is being constructed. With no competition in the region, Comcast has broad practical authority to decide what LOSD will pay. “Right now, Comcast is essentially the only game in town in many communities," Morelock says, "including LO."

Clackamus County will install the $1.54 million network; 40 percent of the total cost will be reimbursed through E-rate, the federal program for schools that pays for Internet access and certain infrastructure expenses.

“After six years, if costs remain the same and do not increase, or decrease for that matter, the district will save $181,000 per year in connectivity costs with the E-rate discount, or $301,000 per year if E-rate were to disappear,” Morelock says.

Connecting In Clackamus

... Read more

Posted July 14, 2016 by alexander

Greenfield city officials and school administrators recently agreed to cooperatively build a fiber-optic institutional network (I-Net). The Milwaukee suburb of about 37,000 expects to trim thousands of dollars from its annual network bill and bring its students, teachers, and local government up to speed.

Dig Now, Save Now

Just like many communities across the U.S., Greenfield realized that it was paying too much to connect its community anchor institutions (CAIs) to the Internet. In April 2015, Greenfield school district approved a bandwidth upgrade with a private provider that would cost the schools $45,588 annually. Within half a year, they had already hit their new bandwidth limit. In November 2015, they needed to upgrade again to the tune of $119,141 per year. 

With classrooms and public institutions demanding increasingly higher bandwidth, local officials decided to ditch the incumbent providers to build a fast, affordable, reliable network in the coming semester. Their investment will allow them to make long-term budgeting decisions, direct more money toward classroom expenses, and use technology to offer rich educational experiences. 

Construction started in June on the fiber-optic network that will connect Greenfield school district, neighboring Whitnall school district, Alverno College, and Greenfield public safety buildings. With installation slated to finish by summer’s end, local institutions expect immediate savings. 

Financial Terms

The City of Greenfield, Greenfield School District, and Whitnall School District all applied for state trust fund loans through the Board of Commissioners of Public Lands of Wisconsin (BCPL). 

Michael Neitzke, Greenfield’s mayor, expects the town to repay it share - a $700,000 loan from BCPL - within 10 years thanks to annual telecommunications savings. The school districts anticipate even shorter repayment periods. Officials at Greenfield School District expect to pay off their loan within 4 years, according to Superintendent Lisa Elliot... Read more

Posted January 18, 2016 by htrostle

A recent series of in-depth articles from Education Week brings to light a persistent aspect of the digital divide: the lack of fast, affordable, reliable connectivity in rural schools. Throughout the country, schools struggle to pay exorbitant fees for aging copper networks. Teachers and students are cut off from digital learning opportunities as whole regions fall farther behind. Education Week brings these issues to the forefront - and community-owned institutional networks could be the answer.

The Education Week articles describes the harsh impact of these grim statistics. The nonprofit EducationSuperHighway found that for rural schools, the median price for connectivity is more than double that of urban or even suburban schools. Although the number of students without access to sufficient bandwidth has been cut in half since 2013, at least 21 million students do not have access to adequate connections. 

In extremely rural communities, large service providers do not have an incentive to build high-speed networks, and small private providers often cannot take on those high upfront costs. This leaves communities with no choice, but to pay skyrocketing rates for slow, unreliable Internet access over aging infrastructure.

East and West: Students Face Similar Challenges

The articles present two compelling case studies of Calhoun County, Mississippi, and Catron County, New Mexico, to tell the story of how high-speed connectivity is so often out-of-reach for rural schools.

Two schools in sparsely-populated western New Mexico split 22 Megabits per second (Mbps) of bandwidth for $3,700 per month. An increase to 50 Mbps wouldn’t require  new fiber, but the upgrade would cost an extra $1,003.47 each month. The local provider has a de facto monopoly in the region so the schools have no choice but to pay the going rate; with no competition they have no leverage for negotiating. According to the New Mexico Public School Facilities Authority, monthly rates range from $1.35 to $3,780 for each Mbps of speed across the state.

In Calhoun County, the... Read more

Posted March 17, 2014 by lgonzalez

On February 27, the New America Foundation presented the live webcast, "Connected Communities in an Age of Digital Learning: A Vision for a 21st Century E-rate Program."

The webcast addressing the modernization of the E-rate program is now archived and available to view.

As technology advances, schools must find ways to keep up. At the root of their success is connectivity in the communities. From the announcement:

Yet many communities lack robust Internet connectivity, which is a key prerequisite to using these tools. Libraries and schools across the country report that they do not have the necessary speeds and equipment to support the digital learning environments of today, let alone tomorrow. Sustaining and upgrading the Internet infrastructure that supports these community anchor institutions is critical. And in addition to physical infrastructure, these communities need investments in social infrastructure: support systems in and around community institutions that help facilitate digital literacy, support broadband access, and encourage meaningful broadband adoption. 

The panel included experts in education, library science, and technology. Featured speakers were:

Posted July 18, 2013 by lgonzalez

In the 1990s, the community of Shafter, California, began developing its strategic plan; the move would eventually lead them to build a municipal broadband network. The town of 17,000 still depended primarily on agriculture but manufacturers were relocating to the community, drawn by its proximity to the railroad and its open space. Potential employers increasingly focused on broadband access as a priority and Shafter realized broadband would be critical to continued growth.

Shafter’s Assistant City Manager Scott Hurlbert recently explained to us how the community built its own fiber network to serve commercial clients, local government, and schools. This incremental approach is not unique but Shafter has no municipal electric nor gas utility, which does puts it in the company of Santa Monica, Mount Vernon, and a few other communities that have built networks without having a municipal power company.

Shafter’s City Council examined its strengths and its weaknesses and found a way to build a network with no borrowing or bonding. The community continues to expand its fiber network, attracting businesses and improving quality of life in this central California town.

In the 1990s AT&T was the main business services provider and it would only improve business telecommunications on an order-by-order basis. Companies that wanted to build beyond the developed town had to pay for the installation themselves, often waiting months to get connected. Prices were "obscene" and the delays almost killed several commercial deals. Even today AT&T takes the same approach in Shafter.

When he joined the City in 2005 as the IT Director, Hurlbert and his staff researched wireless technologies but determined that fiber-optic deployment would be the best option. At that time, the bandwidth demand was already intense and a wireless network would need fiber for backhaul. Hurlbert and staff also investigated other communities, including Chelan, Washington, to look for workable models.

In 2006, three master planned residential subdivisions were approved for expansion of the City of Shafter. The city saw this as an opportunity to... Read more

Posted May 17, 2013 by lgonzalez

Joanne Hovis, President of CTC Technology and Energy, recently published a must-read article in Broadband Properties Magazine. Whether you are a community leader investigating the possibility of a publicly owned network or an engaged citizen looking for pros and cons, this piece explains practical benefits succinctly. In her article, The Business Case For Government Fiber Networks [PDF], Hovis looks at life beyond stimulus funding. She points out how we should evaluate municipal networks in an environment where shareholder profit is not the first consideration.

Hovis gives a brief history of how local communities reached this point of need. As many of our readers know, local communities used to be able to negotiate with cable providers for franchise opportunities and rights-of-way. Often cable providers would construct broadband infrastructure in exchange for a franchise to operate in a given community, creating I-Nets for local government, schools and libraries. Once states inserted themselves into the process with state-wide franchising, local negotiating power evaporated. Many of those franchise agreements are ending and local leaders are considering municipal fiber optic networks.

Hovis stresses that municipalities do not function in the same environment as the private sector. While they still have a fiscal responsibility to their shareholders (the taxpayers) the main function is providing public safety, encouraging economic development, offering education, and using tax dollars to better the quality of life. Hovis describes how redefining return on investment (ROI) needs to go beyond the balance sheet bottom line. 

These benefits have nothing to do 
with traditional financial measures. Rather, they represent the return 
to the community in terms of such largely intangible societal benefits 
as enhancing health care quality, narrowing the digital divide, providing enhanced educational opportunities to school children, delivering job search and placement opportunities at public computer centers and helping isolated senior citizens make virtual social connections.

joanne-hovis.jpg

Even without the intangible benefits, Hovis argues the financial... Read more

Posted January 10, 2011 by christopher

The Federal Communications Commission released the results of a survey of libraries and schools, the 2010 E-Rate Program and Broadband Usage Survey - announcement here [pdf] and full report here [pdf].

As critical as we are of the FCC, I would like to note that the FCC is doing a better job of collecting data than it did in the past.

I want to highlight a few interesting pieces from the report. Of the respondents, only 21% of schools and 13% of libraries have connections riding on fiber-optics. Half of schools and libraries are stuck on T1 lines.

Schools and libraries reported 63% and 65%, respectively, connections that were under 10Mbps. Considering these connections are likely serving many concurrent connections, they should have faster connections.

The vast majority want to have faster connections:

FCC Chart of those desiring faster connections

The question is why they want faster connections. Only 20% say their current connection completely meets their need to conduct online testing and assessment applications - with another 44% saying it "mostly" meets those needs.

Chart

These gaps represent a tremendous opportunity for growth - communities should be building their own fiber-optic connections to connect these key institutions and ensure they will have affordable, fast, and reliable connections well into the future. By owning the network, these institutions will have greater control over future costs and their capacity to take advantage of even newer applications.

The FCC should favor locally owned networks to encourage self-reliance instead of never-ending subsidies to private carriers who have little incentive to lower prices and increase investment.

Posted December 9, 2009 by christopher

Following up on my previous post "Institutional Networks and Cherry Picking," I want to briefly note that the U.S. should reform how it funds Internet connections at schools and libraries.

Let me start with an assumption: we do not want to use federal taxes to support these local institutions except where most necessary. It strikes me that wherever possible, communities should take responsibility for their own community institutions.

With that in mind, the eRate program concerns me. Basically, eRate is a means for the federal government to aid local schools and libraries in affording broadband. I'm afraid that it indirectly encourages monopolistic service providers (mainly telephone incumbents) to overcharge for T-1 lines while removing any incentive for the school or library to invest in a better connection.

If a school or library is only paying 20% of the cost of a slow and overpriced line, it has considerably less motivation to seek a better connection -- especially as the only alternative to an existing connection may be building new fiber paths - as noted in "Libraries dying for bandwidth."

But another problem is simple availability. As the ALA's report (PDF) points out, "moving from a 56Kbps circuit to 1.5Mbps is one thing. Moving from 1.5Mbps to 20Mbps or to 100Mbps or even to a gigabit—depending on the size and need of the library—is another." Even when they can pay for it, many libraries are finding that higher speeds simply aren't available.

This program has been around since 1998 and has paid out $25 billion. Imagine if the program had encouraged the schools and libraries to build their own networks from the start - a truly sustainable approach rather than an approach that brought slow broadband to these anchor institutions while rewarding telephone companies significantly overcharging for slow services.

Consider Joanne Hovis of Columbia Telecommunications Company -

In Montgomery County schools connected to a community-owned fiber network are getting access to 100Mbps speeds and paying $71 per Mbps per month, whereas neighboring schools not on the network are paying $2,000 a... Read more

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