Press Release of Sen. Conrad Burns (R-MT).
Re: Introduction of e-rate bill.
Date: May 11, 1999.
Source: Office of Sen. Burns. This document was created by Tech Law Journal by scanning a paper copy, and converting into HTML.

Burns Introduces E-Rate Stability Bill
Bill Ensures Funding of Universal Service, Schools and Libraries Programs

WASHINGTON, D.C. -- Montana Senator Conrad Burns today introduced a bill to improve the Schools and Libraries, or E-rate, program, which is intended to help connect schools and libraries to the Internet.

Burns' bill would separate the Schools and Libraries Program from the Universal Service Fund, which was originally intended to ensure affordable telephone services for people in rural and under-served areas. Attaching the Schools and Libraries Program to the Universal Service Fund has led to higher telephone bills for consumers.

Instead of funding the program through the Universal Service Fund, the bill would cut the 3 percent federal excise tax on telephone calls to 1 percent. The funds generated from the remaining tax would be redirected to the Schools and Libraries Program through grants to the states. Such a program would have generated roughly $1.9 billion for schools in 1998, compared to the $1.66 billion the FCC distributed that year.

All of the FCC commissioners expressed initial support for such a funding mechanism at a Senate Commerce Committee hearing in 1998.

Under Burns' bill, the program would be administered by the National Telecommunications and Information Administration (NTIA), which administers a number of technology grant programs for the federal government.

"The Schools and Libraries program is extremely important for schools that cannot afford the initial costs of connecting to the Internet, which has become an invaluable educational tool," Burns said. "I want to see this program reach its full potential for success, and the best way to do that is provide a stable structure that is not the subject to the FCC's whims.

"This bill ensures the continued viability of the Schools and Libraries program by tying it to a specific, predictable funding mechanism. The bill also makes sure that universal service is saved for its original objective - providing affordable telephone service for folks in rural areas.

"Aside from stabilizing the E-rate and universal service programs, this bill gives Americans a significant tax cut. It's a win-win situation for our children and our wallets."

Some have argued that projected savings by telephone companies due to reduced access charges will provide additional funding for the E-rate program. Burns said he did not think the government should force companies to use potential consumer savings for an open-ended entitlement.

Burns is chairman of the Senate Communications Subcommittee, which oversees many Internet issues.

Rep. Billy Tauzin (R-La.) introduced companion legislation today in the House of Representatives.