Broadband Subsidies for Community Anchor Institutions


Studies show that CAIs often cannot afford to purchase the broadband capacity they need to serve their communities. Policymakers can address CAIs’ financial constraints with direct subsidies to CAIs, encouraging them to work together in planning joint procurement of broadband services, and expediting review of consortium applications for funding that can yield cost savings.

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Recommendations for Action

Below are some recommended actions that support the goal of affordable high-capacity broadband services for all anchor institutions:

  • Policymakers at all levels of government should strive to collect better data on broadband deployment to, and adoption by, anchor institutions. This data can help identify broadband needs more precisely and target funds more efficiently. In particular, efforts should be made both to measure existing broadband capacity and to estimate the future broadband needs of anchor institutions, including the cost of both deployment and ongoing service.
  • The FCC should lower the amount of funding required of applicants to the Healthcare Connect Fund from 35 percent down to 15 percent, the amount required for the Rural Health Care pilot program.
  • The FCC can take more assertive action to enforce the “lowest corresponding price” rule in the E-rate program to make sure that broadband providers are not inflating their prices because of the E-rate discount.
  • By the end of 2016, the FCC should develop national pricing benchmarks for broadband services to ensure that schools and libraries in high-cost areas are able to purchase broadband offerings at rates that are reasonably comparable to similar offerings to schools and libraries in urban areas.
  • If they have not done so already, states should establish their own programs to support anchor institutions’ broadband expenses either to supplement the federal programs or to support anchor institutions that do not receive federal subsidies. Those states that have already adopted such programs should modernize them to ensure they are designed to promote high-speed broadband connectivity that CAIs will need for the future.
  • States can reduce broadband expenditures by aggregating broadband traffic onto shared networks serving all government buildings and services, rather than encouraging separate and duplicative networks.
  • As in Utah, states can create or fund umbrella state entities to (1) procure, provision, and manage network facilities for anchor institutions, (2) offer technical assistance and other consulting services to anchor institutions to help them take advantage of the broadband services available to them, (3) help schools, libraries, and rural health care providers apply for federal universal service funding, and (4) obtain the best pricing via aggregated demand.
  • States should take advantage of the FCC’s offer to provide an additional 10 percent of E-rate funding by considering special construction projects to deploy high-speed fiber connections to schools and libraries.
  • Policymakers should encourage competition among broadband providers and should look favorably   on new entrants into the broadband marketplace. More competition should result in more widespread broadband availability and lower prices.

Examples/Case Studies

2016 California Teleconnect Fund (CTF) Website
2016 Wisconsin's Technology for Educational Achievement (TEACH) program Website
2016 Missouri's MoBroadbandNow Website
2016 nDanville Fiber Project in Virginia Website
2016 CENIC opens network to carry library traffic Website
2016 Oklahoma's Special Universal Service Fung Article

Additonal Research

FCC’s 2016 Broadband Progress Report
The FCC’s Congressionally-mandated report determining whether “advanced telecommunications capability” -- broadband -- is being deployed to all Americans in a “reasonable and timely fashion.” If the answer is negative, the Act requires the FCC to “take immediate action” to speed deployment. (January 29,  2016)

FCC’s E-rate First Modernization Order
The FCC took major steps to modernize and streamline the E-rate program and focused on expanding funding for Wi-Fi networks in elementary and secondary schools and libraries across America. (July 11, 2014)

FCC’s E-rate Second Modernization Order
The FCC aimed to ensure that all schools and libraries have access to high-speed connectivity by increasing the E-rate program spending cap to adequately support that connectivity. (December 11, 2014)

FCC’s Rural Health Care Order
The FCC reformed its universal service support programs for health care, transitioning the existing Internet Access and Rural Health Care Pilot Programs into a new, efficient Healthcare Connect Fund. (December 21, 2012)

Connecting America: The National Broadband Plan
Sets out a roadmap for initiatives to stimulate economic growth, spur job creation and boost America’s capabilities in education, health  care, homeland security and more. (March 17,  2010)

Additional Coordination and Performance Measurement Needed for High-Speed Internet Access Programs on Tribal Lands
Government Accountability Office review of the status of high-speed Internet on tribal lands. (January 2016)

2015 State of the States
Education Superhighway report on the state of broadband connectivity in America’s public schools. (November 2015)

Broadband Quality in Public Libraries
American Library Association report on public library technology infrastructure and how it is used to enable digital inclusion in communities nationwide.  (April  2015)

3d Annual E-rate and Infrastructure Survey
Consortium for School Networking asked K-12 school leaders and technology directors from around America about the state of connectivity in their districts and the impact they’ve felt from changes to the E-rate program. (2015)

Anchor Institutions:  An Interpretive Review Essay
Marga, Inc. seeks to evaluate the current state of knowledge on anchor institutions. (2013)

Progress on National Broadband Plan Goals
The Benton Foundation tracks implementation of the National Broadband Plan.

Impact Aid
Department of Education explainer on assistance to local school districts with concentrations of children residing on Indian lands.

About the Author

Gina Spade is the founder of Broadband Legal Strategies, a law firm specializing in universal service issues. During her 13 years at the Federal Communications Commission, Gina served as the policy manager for both the E-rate (six years) and Rural Healthcare (five years) programs. In addition, she oversaw audits, the Payment Quality Assurance Program, fraud detection, and financial issues for all universal service programs while in the Office of the Managing Director.

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Action Plan Authors

Amelia Bryne

Kelleigh Cole

Joanne Hovis

Tom Koutsky

Blair Levin

Christine Mullins

Angela Siefer

Gina Spade

John Windhausen


Steering Committee

Larra Clark, American Library Association

Adrianne Furniss, Benton Foundation

Kevin Taglang, Benton Foundation

Bob Collie, ENA

Lil Kellogg, ENA

Rex Miller, ENA

Susannah Spellman, Internet2/USUCAN