Federal Communications Commission DA 20-263 DA 20-263 Released: March 12, 2020 WIRELINE COMPETITION BUREAU ANNOUNCES E-RATE AND RHC PROGRAMS’ INFLATION-BASED CAPS FOR FUNDING YEAR 2020 CC Docket No. 02-6 WC Docket No. 02-60 Pursuant to sections 54.507(a) and 54.619(a) of the Commission’s rules, 47 CFR §§ 54.507(a), 54.619(a). the Wireline Competition Bureau (Bureau) announces the E-Rate and Rural Health Care (RHC) programs’ funding caps for funding year 2020. The Commission’s rules require an adjustment of the E-Rate and RHC programs’ annual caps based on the gross domestic product chain-type price index (GDP-CPI) measure of inflation. See Schools and Libraries Universal Service Support Mechanism; A National Broadband Plan For Our Future, CC Docket No. 02-6, GN Docket No. 09-51, Order, 25 FCC Rcd 18762, 18782, para. 39 (2010) (E-Rate Sixth Report and Order); Promoting Telehealth In Rural America, WC Docket No. 17-310, Report and Order, 33 FCC Rcd 6574, 6580, para. 13 (2018) (RHC Program Funding Cap Order); Promoting Telehealth in Rural America, WC Docket No. 17-310, Report and Order, 34 FCC Rcd 7335, 7400-02, paras. 138-140 (2019) (Promoting Telehealth Report and Order); 47 CFR §§ 54.507(a)(1)-(2), 54.619(a)(1)-(2). The E-Rate program is more formally known as the Schools and Libraries universal service support program. The new caps represent a 1.8% inflation-adjusted increase in each program cap from funding year 2019. National Income and Product Accounts Table, Bureau of Economic Analysis, revised Feb. 27, 2020, Table 1.1.4, https://apps.bea.gov/iTable/iTable.cfm?reqid=19&step=2#reqid=19&step=3&isuri=1&1910=x&0=-99&1921=survey&1903=4&1904=2015&1905=2017&1906=a&1911=0 (GDP-CPI table; based on gross domestic product average across four quarters of 110.382 in 2018 and 112.347 in 2019, we calculate an increase of 1.8%). Note that the 2018 gross domestic product figure has been revised upward by the Bureau of Economic Analysis (BEA) since the Bureau announced the E-Rate and RHC program funding caps for funding year 2019. See Wireline Competition Bureau Announces E-rate and RHC Programs’ Inflation-Based Caps for Funding Year 2019, CC Docket No. 02-06, Public Notice, 34 FCC Rcd 1138, n.3 (WCB 2019) (2019 Inflation Funding Cap PN) (using a gross domestic product figure of 110.337 for 2018 to determine E-Rate and RHC programs’ funding caps for funding year 2019). E-Rate Program: The E-Rate program funding cap for funding year 2020 is $4,226,120,519. This represents a $74,725,117 increase for the E-Rate program funding cap as a whole, including a $55,564,831 increase for the category one services funding level and a $19,160,286 increase for the category two services funding level. See 47 CFR § 54.507(a)(3) (noting that the Bureau will release a public notice “announcing any increase of the annual funding cap including any increase to the $1 billion funding level available for category two services based on the rate of inflation”). The 2020 funding year runs from July 1, 2020 to June 30, 2021. The new cap represents a 1.8% inflation-adjusted increase in the $4,151,395,402 cap from funding year 2019. See supra note 3; 2019 Inflation Funding Cap PN. The Commission began indexing the funding cap to inflation in 2010 to ensure that E-Rate program funding keeps pace with the changing broadband and telecommunications needs of schools and libraries. E-Rate Sixth Report and Order, 25 FCC Rcd at 18781, para. 36. The Commission did not increase the funding cap in funding year 2015 pursuant to section 54.507(a)(1) of the Commission’s rules. 47 CFR § 54.507(a)(1). RHC Program: The RHC Program funding cap for funding year 2020 is $604,759,306. This represents a $10,693,190 increase for the RHC program funding cap. The 2020 funding year runs from July 1, 2020 to June 30, 2021. The cap for upfront payments and multi-year commitments under the Healthcare Connect Fund Program is $152,700,000. This represents a $2,700,000 increase for the $150 million cap on multi-year commitments and upfront payments under the Healthcare Connect Fund Program. These new caps represent a 1.8% inflation-adjusted increase in the $594,066,116 RHC Program funding cap and the cap on multi-year commitments and upfront payments from funding year 2019. See supra note 3; RHC Program Funding Cap Order, 33 FCC Rcd at 6584, para. 23; Promoting Telehealth Report and Order, 34 FCC Rcd at 7401, para. 139. The Commission began indexing the RHC Program funding cap to inflation in 2018 to ensure that RHC Program funding keeps pace with the changing broadband and telecommunications needs of rural healthcare providers. RHC Program Funding Cap Order, 33 FCC Rcd at 6583, para. 21. It began indexing the $150 million cap on multi-year commitments and upfront payments to inflation in 2020 to prevent inflation from eroding the purchasing power of health care providers requesting multi-year commitments and upfront payments under the Healthcare Connect Fund Program. Promoting Telehealth Report and Order, 34 FCC Rcd at 7401, para. 139; 47 CFR § 54.619(a)(1)-(2). For further information, please contact James Bachtell, Wireline Competition Bureau at (202) 418-7400, or (202) 418-0484 (TTY). - FCC - 2