FCC Eliminates E-Rate Support for Off-Premises and School Bus Wi-Fi

The FCC has rescinded its prior authorization of E-Rate support for off-premises uses of Wi-Fi hotspots and associated wireless Internet services. In an Order on Reconsideration, the FCC found that its previous decision in the July 2024 Hotspots Order to authorize such support exceeded its statutory authority under Section 254 of the Communications Act. The FCC agreed with several petitioners’ arguments that the prior rules were not consistent with the statute and denied further requests to expand E-Rate support for off-premises services.

The FCC also issued a Declaratory Ruling clarifying that the provision of Wi-Fi or other similar access point technologies, including equipment needed to provide such service on school buses, is ineligible for E-Rate funding beginning in FY 2025. This ruling reverses the FCC’s October 2023 Declaratory Ruling, which had found that providing Wi-Fi on school buses served an educational purpose and was therefore eligible for E-Rate support.

As a result, E-Rate funding is now limited to services provided on school and library premises. Off-premises services are no longer eligible. The FCC directed the Wireline Competition Bureau to amend the FY 2025 Eligible Service List, and with the assistance of the Universal Service Administrative Company (USAC), to revise all forms, procedures, and outreach materials. USAC was also instructed to deny all pending funding requests for the off-premises use of Wi-Fi hotspots and wireless services.

What This Means for E-Rate Applicants/Providers

1. Beginning with FY 2025, USAC will deny all funding requests for school bus Wi-Fi and off premises use of Wi-Fi hotspots and associated services. Eligible funding is now limited to on-premises connectivity only.
2. For school bus Wi-Fi, which was eligible for funding beginning in FY2024, the FCC will not apply the new ruling retroactively to funding requested and granted for FY 2024. The FCC noted that multi-year agreements entered into in FY2024 will not be funded beyond FY2024, as funding is committed year-by-year and is not guaranteed for multiple years.
3. Service providers should coordinate with applicants to review, amend, or terminate existing bus and off-premises Wi-Fi contracts as needed to address funding changes.
4. Schools, libraries, and service providers should review pending applications, limit future requests to on-premises connectivity, and monitor FCC/USAC guidance to ensure compliance with revised E-Rate rules.

If you have questions about the FCC’s decisions or the E-Rate rules in general, contact Rebecca Goldman, Mark Palchick or Sherry Ross in our Broadband, Spectrum, and Communications Infrastructure Practice Group.