[Federal Register Volume 89, Number 161 (Tuesday, August 20, 2024)]
[Proposed Rules]
[Pages 67394-67400]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-18123]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 54

[WC Docket No. 21-31; FCC 24-76; FR ID 237188]


Addressing the Homework Gap Through the E-Rate Program

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document, the Federal Communications Commission 
(Commission or FCC) seeks further comment on how to ensure the success 
of schools and libraries' hotspot lending programs, including through 
continued collaboration by multiple stakeholders.

DATES: Comments are due on or before October 4, 2024, and reply 
comments are due on or before November 4, 2024. If you anticipate that 
you will be submitting comments but find it difficult to do so within 
the period of time allowed by this document, you should advise the 
contact person listed as soon as possible.

ADDRESSES: Pursuant to Sec. Sec.  1.415 and 1.419 of the Commission's 
rules, 47 CFR 1.415, 1.419, interested parties may file comments and 
reply comments. You may submit comments identified by WC Docket No. 21-
31 by any of the following methods:
     Electronic Filers: Comments may be filed electronically 
using the internet by accessing the Commission's Electronic Comment 
Filing System (ECFS): https://www.fcc.gov/ecfs/.
     Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing.
     Filings can be sent by hand or messenger delivery, by 
commercial courier, or by the U.S. Postal Service.

[[Page 67395]]

All filings must be addressed to the Secretary, Federal Communications 
Commission.
     Hand-delivered or messenger-delivered paper filings for 
the Commission's Secretary are accepted between 8:00 a.m. and 4:00 p.m. 
by the FCC's mailing contractor at 9050 Junction Drive, Annapolis 
Junction, MD 20701. All hand deliveries must be held together with 
rubber bands or fasteners. Any envelopes and boxes must be disposed of 
before entering the building.
     Commercial courier deliveries (any deliveries not by the 
U.S. Postal Service) must be sent to 9050 Junction Drive, Annapolis 
Junction, MD 20701.
     Filings sent by U.S. Postal Service First-Class Mail, 
Priority Mail, and Priority Mail Express must be sent to 45 L Street 
NE, Washington, DC 20554.
     People with Disabilities: To request materials in 
accessible formats for people with disabilities (braille, large print, 
electronic files, audio format), send an email to [email protected] or 
call the Consumer & Governmental Affairs Bureau at 202-418-0530 
(voice), 202-418-0432 (TTY).

FOR FURTHER INFORMATION CONTACT: For further information, please 
contact, Molly O'Conor, Telecommunications Access Policy Division, 
Wireline Competition Bureau, at [email protected] or (202) 418-7400. 
Requests for accommodations should be made as soon as possible in order 
to allow the agency to satisfy such requests whenever possible. Send an 
email to [email protected] or call the Consumer and government Affairs 
Bureau at (202) 418-0530.

SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission's 
Report and Order (Order) and Further Notice of Proposed Rulemaking 
(FNPRM) in WC Docket No. 21-31; FCC 24-76, adopted July 18, 2024 and 
released July 29, 2024. The full text of this document is available for 
public inspection during regular business hours at Commission's 
headquarters 45 L Street NE, Washington, DC 20554 or at the following 
internet address: https://docs.fcc.gov/public/attachments/FCC-24-76A1.pdf.
    Availability of Documents. Comments, reply comments, and ex parte 
submissions will be publicly available online via ECFS.
    Ex Parte Presentations-Permit-But-Disclose. The proceeding this 
document initiates shall be treated as a ``permit-but-disclose'' 
proceeding in accordance with the Commission's ex parte rules. Persons 
making ex parte presentations must file a copy of any written 
presentation or a memorandum summarizing any oral presentation within 
two business days after the presentation (unless a different deadline 
applicable to the Sunshine period applies). Persons making oral ex 
parte presentations are reminded that memoranda summarizing the 
presentation must (1) list all persons attending or otherwise 
participating in the meeting at which the ex parte presentation was 
made, and (2) summarize all data presented and arguments made during 
the presentation. If the presentation consisted in whole or in part of 
the presentation of data or arguments already reflected in the 
presenter's written comments, memoranda or other filings in the 
proceeding, the presenter may provide citations to such data or 
arguments in his or her prior comments, memoranda, or other filings 
(specifying the relevant page and/or paragraph numbers where such data 
or arguments can be found) in lieu of summarizing them in the 
memorandum. Documents shown or given to Commission staff during ex 
parte meetings are deemed to be written ex parte presentations and must 
be filed consistent with rule 1.1206(b). In proceedings governed by 
rule 1.49(f) or for which the Commission has made available a method of 
electronic filing, written ex parte presentations and memoranda 
summarizing oral ex parte presentations, and all attachments thereto, 
must be filed through the electronic comment filing system available 
for that proceeding, and must be filed in their native format (e.g., 
.doc, .xml, .ppt, searchable .pdf). Participants in this proceeding 
should familiarize themselves with the Commission's ex parte rules.
    Providing Accountability Through Transparency Act. Consistent with 
the Providing Accountability Through Transparency Act, Public Law 118-
9, a summary of this document will be available on https://www.fcc.gov/proposed-rulemakings.

Synopsis

Introduction

    Technology has become an integral part of the modern classroom and 
receiving an education, especially in the recent past, and the barrier 
to accessing such technology puts individuals at a significant 
disadvantage to their peers and often prevents educators from being 
able to teach. In the Order, the Commission takes steps to modernize 
the E-Rate program to meet the evolving needs of schools and libraries 
around the country by allowing for the distribution of Wi-Fi hotspots 
and services to students, school staff, and library patrons for off-
premises use.
    Since its inception more than 25 years ago, the Commission's E-Rate 
program has supported high-speed, affordable internet services to and 
within school and library buildings, and has been instrumental in 
providing students, school staff, and library patrons with access to 
the essential broadband services that are required for next-generation 
learning. Recognizing the Commission's responsibility to ensure the E-
Rate program evolves with the educational needs of students and library 
patrons, the Commission has frequently modernized the program to 
reflect the changes in education and technology, including by providing 
more equitable access to funding for Wi-Fi networks in schools and 
libraries. Recently the Commission has seen significant advances in 
technology that have changed not only the way schools and libraries 
provide educational resources, but also the way students, school staff, 
and library patrons access such resources. In particular, an internet 
connection has become an essential requirement for learners to access 
tasks that are vital to obtaining an education, including homework 
assignments, online classes, library materials, continuing education, 
and career and government applications.
    The need for internet connectivity beyond the campus boundaries was 
further underscored by nationwide school and library closures beginning 
in 2020 as a result of the COVID-19 pandemic, when most educational 
activities were unexpectedly forced to shift online overnight. During 
this time, thanks to the creativity and resourcefulness of schools and 
libraries around the country, many students, school staff, and library 
patrons that would have been caught on the wrong side of the digital 
divide or the ``Homework Gap''--i.e., students unable to fully 
participate in educational opportunities because they lack broadband 
connectivity in their homes--were able to obtain a broadband connection 
provided by their local school or library. Many schools and libraries 
used funding provided through the congressionally-appropriated 
Emergency Connectivity Fund (ECF) program to purchase connected 
devices, Wi-Fi hotspot devices, broadband connections, and other 
eligible equipment and services for students, school staff, and library 
patrons in need, to use at a variety of locations, including locations 
other than schools and libraries, during the pandemic. Notably, schools 
and libraries found success in establishing ECF-funded Wi-Fi hotspot

[[Page 67396]]

lending programs to provide the hotspot equipment and monthly mobile 
wireless broadband services needed to connect individuals who otherwise 
lacked the internet access needed to fully participate in remote 
learning.
    Even with schools and libraries reopening and returning to in-
person instruction, the need for internet connections outside of the 
school or library buildings to fully engage in education remains, and 
schools and libraries are seeking to continue funding these valuable 
lending programs to keep their students, school staff, and library 
patrons connected. That is why the Commission adapts the E-Rate program 
to recognize these needs. Building on its experiences in the ECF 
program and the comments the Commission received in response to the 
Notice of Proposed Rulemaking (NPRM), 88 FR 85157, December 7, 2023, 
the Commission adopts a budget mechanism to allow for the equitable 
distribution of Wi-Fi hotspots and services to students, school staff, 
and library patrons. These rules are intended to be another step in 
updating the E-Rate program to reflect the realities of many schools 
and libraries by lending Wi-Fi hotspots and services through community 
and school libraries across the country so that students, school staff, 
and library patrons with the greatest need can be connected and learn 
without limits. The Commission also adopts the FNPRM to seek comment on 
additional ways to ensure the continued success of such Wi-Fi hotspot 
lending programs funded through the E-Rate program.

Further Notice of Proposed Rulemaking

    In this document, the Commission seeks further comment on how to 
ensure the success of schools and libraries' hotspot lending programs, 
including through continued collaboration by multiple stakeholders. In 
particular, the Commission seeks comment on the most effective means to 
ensure that limited E-Rate program funds are being used effectively and 
efficiently, and that Wi-Fi hotspots and services are being used for 
educational purposes and are not going unused. In the Order, the 
Commission focuses on ensuring distribution of the Wi-Fi hotspots and 
setting a maximum period of non-usage that will result in a line being 
terminated. The Commission also relies on program integrity and post-
commitment reviews to check compliance with its rules. Now, the 
Commission seeks to further refine its rules to determine a fair and 
administratively feasible mechanism to set clear limits on E-Rate 
support for hotspot devices that have been distributed, but that may 
have limited periods of non-use, without unfairly burdening both 
applicants and service providers. The applicant community seeks 
assurance that schools and libraries do not become the financial 
guarantors of all service charges for which there was non-usage, while 
service providers assert that they have no way to control or enforce 
the use of a hotspot provided by an applicant to a student, staff 
member, or library patron. For this reason, the Commission has adopted 
what it finds to be a sensible approach for addressing non-usage by 
focusing on distribution, prohibiting warehousing, terminating service 
to lines that go unused for approximately 90 days, and relying on 
program integrity reviews to check compliance as the commission begin 
implementing Wi-Fi hotspot and service support. The Commission now 
seeks further comment on administratively feasible methods to encourage 
maximal usage of these services and devices.
    For instance, the Commission seeks comment on ways applicants could 
take active steps to ensure that E-Rate-supported Wi-Fi hotspots are 
being used by the students, school staff, and library patrons to whom 
they are distributed. The Commission recognizes that even under the 
best circumstances, there may be students or library patrons who simply 
do not turn on a device once they have checked it out. In these 
instances, are there steps the applicant should be required to take in 
order to decrease the chances that the distributed hotspots go unused 
by the users? Should schools and libraries be required to have 
technical support available to teach users how to use the Wi-Fi 
hotspots or troubleshoot issues that may arise? Should schools and 
libraries be required to limit the lending period to a short period 
(e.g., 21 days or less) in order to redistribute hotspots to other 
students or library patrons that may have both the need and ability to 
use the hotspot? For longer lending periods, should the Commission 
imposes a specific period of non-usage (e.g., 30 days) after which 
schools and libraries must seek the return of the hotspot so the device 
can be loaned out again to another user who will use the device? The 
Commission understands that schools and libraries often already do 
this, but seek comment on whether such policies and processes should be 
required before reimbursement is permitted and, if so, what the best 
approaches are for enforcing this requirement. What other steps can 
schools and libraries take to ensure the E-Rate-funded hotspots and 
services are being used by students, school staff members, and library 
patrons? Are there better ways to implement certifications to reduce 
the chances that the E-Rate program is supporting Wi-Fi hotspots and 
services during periods of non-use? To the extent the Commission 
continues to require applicants to have activated and made the Wi-Fi 
hotspots available, as well as publicized their availability, is 
certifying to having taken these steps on the FCC Form 486 prior to 
submitting their or their service provider's request(s) for 
reimbursement sufficient? Would requiring applicants to certify to 
having taken these measures on the request for reimbursement form or 
some other form provide better certainty that these actions have been 
taken? How else might the Commission ensure that applicants have taken 
sufficient measures to make effective use of these E-Rate funded 
hotspots and services? Please include examples from current hotspot 
lending programs on how non-usage is currently being addressed.
    The Commission next seeks comment on ways service providers could 
take additional actions to reduce the amount of E-Rate funds being 
spent on Wi-Fi hotspots and services that are not being actively used 
by the intended users. Should the Commission shorten the period of non-
usage from approximately 90 days and require service providers to 
terminate service when there are 30 days of unused services associated 
with a particular Wi-Fi hotspot line of service? If not at 60 days, 
when should notice to the applicant be made and how? Should the 
Commission require additional steps or documentation before allowing an 
applicant to restart service on a terminated line? Is there an 
appropriate amount of time the applicant should be required to wait to 
restart the service? Consistent with the category two budgets, 
applicants may file a request to reduce or cancel a funding commitment 
in order to use that funding in a future funding year of the budget 
cycle. However, if the applicant has service terminated due to non-
usage, should the Commission consider prohibiting them from later 
reducing their funding commitment to restore the undisbursed funding to 
their hotspot budget? The Commission also seek comment on other billing 
paradigms that could make the program more responsive to usage. Should 
the Commission consider requiring alternative billing methods, such as 
usage-based pricing models, for Wi-Fi hotspot service supported by the 
E-Rate program? In effect, this would allow reimbursement from the E-
Rate program

[[Page 67397]]

only for the service that was used, but such an approach would present 
new difficulties in determining the amount being requested during the 
FCC Form 471 application. If the Commission uses this approach, should 
the Commission remove the funding cap for recurring service adopted in 
the Order? Why or why not?
    While the Commission is requiring that service providers provide 
usage reports to applicants at least once per billing cycle, the 
Commission also seeks comment on whether it should require submission 
of data usage reports during the invoicing process. For example, should 
service providers provide the Universal Service Administrative Company 
(USAC) with reports when an applicant is using fewer than 25% (or some 
other threshold) of the service lines? Recognizing that the format for 
these data submissions may also be important to preventing waste and 
improving program integrity, what structure should data usage reports 
have and what format should they be provided in? Are there ways to make 
such data usage reports easier for applicants, and in particular small 
applicants without dedicated staff for a hotspot lending program, to 
quickly identify the hotspot devices and services that are going 
unused? Would it make sense to have the reports identify the number of 
lines that went unused during a particular billing cycle and reduce the 
reimbursement for each unused line to a nominal amount, such as $3, 
that would pay for the continued access to the network that went 
unused? Similarly, would additional structure be needed for the 
applicant asset inventories to better match the data usage reports and 
would that have value? What steps should the Commission take to make 
sure the information provided does not include personally identifiable 
information or other sensitive information? Should there be a data 
usage threshold higher than zero to consider a line used, and if so, 
what would that threshold be? Should service providers be required to 
offer a simple way to remotely discontinue and reestablish lines when 
requested by the applicant? Some libraries reported already having such 
a mechanism to stop service to a specific device if it is not being 
used; does the size of the school or library impact the feasibility of 
implementing such a mechanism for all of the E-Rate funded Wi-Fi 
hotspots and services in circulation? Why or why not? The Commission 
also seeks comment on the experiences of schools and libraries being 
able to discontinue and reestablish lines of services when they request 
to do so from their service provider. Are different levels of service 
needed depending on the school or library size? Are there provisions 
regarding non-usage that could be included in a contract between a 
service provider and an applicant to help address these concerns in a 
manner that balances the responsibility between the service provider 
and applicant? Are there times that an early termination fee for lost 
or broken hotspot devices should be permitted to ensure that service 
providers are not left responsible for the cost of a broken hotspot?
    The Commission seeks comment on these approaches and whether they 
would benefit the E-Rate program and reduce the amount of funding spent 
on Wi-Fi hotspots and services during periods of non-use. To the extent 
applicants and service providers believe burdens would increase under 
any of these scenarios, the Commission seeks detailed information on 
the potential costs and benefits. What other steps could be taken to 
reduce that amount of E-Rate funding disbursed for Wi-Fi hotspots and 
services during periods of non-use? Are there other practices the 
Commission should adopt to achieve these goals? For instance, should 
the E-Rate program reduce and limit the number of service lines or the 
quantity of hotspot devices that can be requested in future funding 
years based on the applicant's prior funding year data on non-usage? 
Would this incentivize applicants to better right-size their E-Rate 
supported hotspot lending program? Why or why not?
    Relatedly, the Commission seeks further comment on whether to adopt 
user access restrictions, such as asking for student credentials, like 
a school-issued email and password, or more technical limitations on 
who or which devices may connect to the E-Rate-funded Wi-Fi hotspots. 
To the extent entities already employ user access restrictions, the 
Commission encourages commenters to provide specific information about 
the programs they use, the costs they are paying, and the technical 
functionalities and/or limitations of such restrictions. In the absence 
of adopting restrictions, the Commission also seeks comment on best 
practices for user access restrictions. Have library hotspot lending 
programs also implemented user access restrictions? If so, do they 
differ from school credentialing options? For example, is user access 
for Wi-Fi hotspots based on the patron's library card or other library 
loaning access mechanism?
    Cybersecurity Risk Management. The Commission seeks comment on ways 
to encourage cybersecurity best practices and risk management for 
schools, libraries, and service providers offering Wi-Fi hotspots 
through E-Rate. The Commission adopted the Schools and Libraries 
Cybersecurity Pilot Program (Pilot Program) in June 2024 to explore 
whether and how to utilize USF support to improve cybersecurity 
practices for K-12 schools and libraries. Recognizing the critical 
needs of schools and libraries to protect their broadband networks and 
sensitive student, school staff, and library patron data, the 
Commission seeks comment on how to ensure that using E-Rate support for 
Wi-Fi hotspots does not introduce additional vulnerabilities or risks 
to cyberattacks. Specifically, the Commission seeks comment on whether 
service providers providing Wi-Fi hotspots and service to schools and 
libraries in the E-Rate program should be required to implement 
cybersecurity and supply chain risk management plans. Service providers 
receiving support through the High Cost Enhanced Alternative Connect 
America Cost Model (Enhanced A-CAM) program are required to develop and 
submit cybersecurity and supply chain risk management plans to USAC and 
certify compliance with these requirements. These plans must reflect 
the latest version of the NIST Framework for Improving Critical 
Infrastructure Cybersecurity and cybersecurity best practices. Should 
service providers receiving support for Wi-Fi hotspots be required to 
meet the same or similar standards? Are these service providers already 
in the practice of maintaining these or similar plans? Why or why not? 
Would a certification on the FCC Form 473 (Service Provider Annual 
Certification) be sufficient to allay concerns over cybersecurity 
vulnerabilities faced by schools and libraries? What are the risks of 
allowing third-party Wi-Fi hotspots access to a network? What burdens 
would resellers or smaller service providers face in complying with 
such requirements?
    OPEN Government Data Act. The Commission also seeks comment about 
whether information reported to the FCC or to the Administrator 
pursuant to the requirements adopted in the Order relating to data 
usage reports and asset and service inventories are ``data assets'' 
potentially subject to the requirements of the OPEN Government Data 
Act. The OPEN Government Data Act, requires agencies to make ``public 
data assets'' available under an open license and as ``open Government 
data assets,'' i.e., in

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machine-readable, open format, unencumbered by use restrictions other 
than intellectual property rights, and based on an open standard that 
is maintained by a standards organization. This requirement is to be 
implemented ``in accordance with guidance by the Director'' of the 
Office of Management and Budget.
    The Commission tentatively concludes that data usage reports and/or 
asset and service inventories provided to it or the Administrator do 
not constitute a ``data asset'' as defined in 44 U.S.C. 352(17). A 
``data asset'' is defined as ``a collection of data elements or data 
sets that may be grouped together,'' and ``data'' as ``recorded 
information, regardless of form or the media on which the data is 
recorded.'' Each usage report and asset and service inventory is 
separate and distinct from one another, and the Commission does not 
expect that the information contained in the reports and inventories 
could readily be grouped together in any meaningful way. The Commission 
tentatively concludes therefore that, in the absence of a standardized 
collection form, the proposed collection of data usage reports and 
asset and service inventories would not constitute a ``data asset'' 
subject to the requirements of the OPEN Government Data Act. The 
Commission seeks comment on this tentative conclusion.
    If, however, the Commission proposed collection of data usage 
reports and asset and service inventories can be viewed as a ``data 
asset,'' it seeks comment on the extent to which such information would 
constitute a ``public data asset'' under the OPEN Government Data Act. 
A ``public data asset'' is ``a data asset, or part thereof, maintained 
by the Federal Government that has been, or may be, released to the 
public, including any data asset, or part thereof, subject to 
disclosure under [the Freedom of Information Act (FOIA)].'' Thus, the 
Commission seeks comment on the extent to which the information 
contained in these reports and inventories would be protected from 
disclosure under the FOIA or as personally identifiable information. If 
the information is subject to disclosure under the FOIA, and therefore 
something the FCC would be required to publish in a machine-readable 
format, the Commission seeks comment on whether it should also require 
the information to meet certain requirements to enable that 
publication. Should the Commission require that the information be 
submitted in machine-readable and structured format to facilitate data 
analysis regardless of the extent to which the data may be subject to 
the OPEN Government Data Act public availability requirement?
    Promoting Digital Equity and Inclusion. The Commission, as part of 
its continuing effort to advance digital equity for all, including 
people of color, persons with disabilities, persons who live in rural 
or Tribal areas, and others who are or have been historically 
underserved, marginalized, or adversely affected by persistent poverty 
or inequality, invites comment on any equity-related considerations and 
benefits (if any) that may be associated with the proposals and issues 
discussed herein. Specifically, the Commission seeks comment on how its 
proposals may promote or inhibit advances in diversity, equity, 
inclusion, and accessibility, as well as the scope of the Commission's 
relevant legal authority.

Procedural Matters

    Paperwork Reduction Act. This document seeks comment on possible 
modified information collection requirements. The Commission, as part 
of its continuing effort to reduce paperwork burdens, invites the 
general public and the Office of Management and Budget (OMB) to comment 
on the information collection requirements contained in this document, 
as required by the Paperwork Reduction Act of 1995, Public Law 104-13. 
In addition, pursuant to the Small Business Paperwork Relief Act of 
2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), the Commission 
seeks specific comment on how it might further reduce the information 
collection burden for small business concerns with fewer than 25 
employees.
    Regulatory Flexibility Act. As required by the Regulatory 
Flexibility Act of 1980, as amended (RFA), the Commission has prepared 
this Initial Regulatory Flexibility Analysis (IRFA) of the possible 
significant economic impact on a substantial number of small entities 
by the policies and rules proposed in the FNPRM. Written public 
comments are requested on this IRFA. Comments must be identified as 
responses to the IRFA and must be filed by the deadlines for comments 
in the FNPRM. The Commission will send a copy of the FNPRM, including 
this IRFA, to the Chief Counsel for Advocacy of the Small Business 
Administration (SBA).
    The E-Rate program will help fund the off-premises use of Wi-Fi 
hotspots and services for students, school staff, and library patrons 
by funding Wi-Fi hotspots and services for schools and libraries to 
establish lending programs. The primary objective of the FNPRM is to 
seek comments that will help maintain the success of the Wi-Fi hotspots 
lending programs by ensuring there is usage for educational purposes. 
In the FNPRM, the Commission seeks comments from stakeholders including 
schools, libraries, and service providers, to come up with an 
administratively feasible method to encourage maximal usage of the Wi-
Fi hotspots and services. The FNPRM requests examples on how non-usage 
is being addressed in current hotspot lending programs. The FNPRM 
invites comments on how to avoid unfairly burdening either applicants 
or service providers, and asks what steps both can take to reduce non-
usage.
    For example, in the FNPRM the Commission asks how to safeguard Wi-
Fi hotspots' usage by asking if schools and libraries should have 
technical support for users and if they should have a limit on the 
lending period before redistributing the hotspots. The FNPRM further 
requests comments on usage reports and how schools, libraries, and 
providers can use the reports to assist in preventing non-usage. The 
FNPRM also asks about certifications to reduce the possibility that E-
Rate funds are going to unuse devices and services. Further, the FNPRM 
requests comments on what further actions, providers and schools should 
take after the discovery of non-usage. Additionally, the FNPRM seeks 
comment on how to ensure that using E-Rate support for Wi-Fi hotspots 
does not introduce additional vulnerabilities or risks to cyberattacks. 
The information and comments requested in the FNPRM will help 
strengthen the integrity of the E-Rate program by ensuring usage of Wi-
Fi hotspots and services.
    The proposed actions are authorized pursuant to sections 1 through 
4, 201 through 202, 254, 303(r), and 403 of the Communications Act of 
1934, as amended.
    The RFA directs agencies to provide a description of and, where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules, if adopted. The RFA generally defines 
the term ``small entity'' as having the same meaning as the terms 
``small business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small business concern'' under the Small Business 
Act. A small business concern is one that: (1) is independently owned 
and operated; (2) is not dominant in its field of operation; and (3) 
satisfies any additional criteria established by the Small Business 
Administration (SBA).

[[Page 67399]]

    Small Businesses, Small Organizations, Small Governmental 
Jurisdictions. The Commission's actions, over time, may affect small 
entities that are not easily categorized at present. The Commission 
therefore describes, at the outset, three broad groups of small 
entities that could be directly affected herein. First, while there are 
industry specific size standards for small businesses that are used in 
the regulatory flexibility analysis, according to data from the Small 
Business Administration's (SBA) Office of Advocacy, in general a small 
business is an independent business having fewer than 500 employees. 
These types of small businesses represent 99.9% of all businesses in 
the United States, which translates to 33.2 million businesses.
    Next, the type of small entity described as a ``small 
organization'' is generally ``any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field.'' 
The Internal Revenue Service (IRS) uses a revenue benchmark of $50,000 
or less to delineate its annual electronic filing requirements for 
small exempt organizations. Nationwide, for tax year 2022, there were 
approximately 530,109 small exempt organizations in the U.S. reporting 
revenues of $50,000 or less according to the registration and tax data 
for exempt organizations available from the IRS.
    Finally, the small entity described as a ``small governmental 
jurisdiction'' is defined generally as ``governments of cities, 
counties, towns, townships, villages, school districts, or special 
districts, with a population of less than fifty thousand.'' U.S. Census 
Bureau data from the 2022 Census of Governments indicate there were 
90,837 local governmental jurisdictions consisting of general purpose 
governments and special purpose governments in the United States. Of 
this number, there were 36,845 general purpose governments (county, 
municipal, and town or township) with populations of less than 50,000 
and 11,879 special purpose governments (independent school districts) 
with enrollment populations of less than 50,000. Accordingly, based on 
the 2022 U.S. Census of Governments data, the Commission estimates that 
at least 48,724 entities fall into the category of ``small governmental 
jurisdictions.''
    Small entities potentially affected by the rules herein are 
Schools, Libraries, Wired Telecommunications Carriers, All Other 
Telecommunications, Wireless Telecommunications Carriers (except 
Satellite), Wireless Telephony, Wireless Carriers and Service 
Providers, Telecommunications Resellers, Local Resellers, Wired 
Broadband internet Access Service Providers (Wired ISPs), Wireless 
Broadband internet Access Service Providers (Wireless ISPs or WISPs), 
internet Service Providers (Non-Broadband), Wireless Telephony, Vendors 
of Infrastructure Development or Network Buildout, Telephone Apparatus 
Manufacturing, Radio and Television Broadcasting and Wireless 
Communications Equipment Manufacturing.
    The potential rule changes proceeding out of the FNPRM, could 
impose some new or modified reporting, recordkeeping, or other 
compliance requirements on schools, libraries, service providers, 
including small entities. The FNPRM requests comments on how to prevent 
non-usage of Wi-Fi hotspots and services funded by the E-Rate program 
and the comments receive will help determine what reporting, 
recordkeeping, or other compliance requirements the Commission should 
adopt to prevent or reduce non-usage. The FNPRM specifically seeks 
comments on data usage reports, and it is possible that schools, 
libraries, and service providers, including small entities, could have 
additional requirements related to retaining and producing usage 
reports and certifications. The FNPRM also seeks comments on 
certifications as a measure to help ensure usage prior to 
reimbursement. It is also possible that schools, libraries, and service 
providers, including small entities, could have new requirements 
related to certifications.
    Additionally, the FNPRM seeks comments on whether applicants should 
be required to limit the lending period to a shorter period and this 
may create more recordkeeping, since an increase in the frequency of 
redistribution is likely to increase the frequency of recording the 
inventory and asset requirements that are mandatory for a loaned 
hotspot and service. The FNPRM also seeks comment on whether schools 
and libraries must have technical support available to teach users how 
to use the Wi-Fi hotspots, and troubleshoot issues as they arise. For 
service providers, in addition to possible new requirements with usage 
reports, including making the reports transparent and easier for 
applicants and the Commission to identify when hotspots are unused, 
they may also be required to offer a simple way to remotely discontinue 
and reestablish lines when requested by applicants, which may create 
more reporting and recordkeeping requirements. Further, applicants and 
providers may be required to include provisions regarding non-usage in 
their contracts to help address these concerns in a manner that 
balances the burden between the provider and applicant. The FNPRM also 
seeks comment on whether service providers providing Wi-Fi hotspots and 
service to schools and libraries in the E-Rate program should be 
required to implement cybersecurity and supply chain risk management 
plans.
    In assessing the cost of compliance for small entities, at this 
time the Commission cannot quantify the cost of compliance with any of 
the potential rule changes that may be adopted. Further, the Commission 
is not in a position to determine whether, if adopted, the matters upon 
which the FNPRM seeks comment will require small entities to hire 
professionals to comply. The information the Commission receives in 
comments, including, where requested, cost information, will help it 
identify and evaluate relevant compliance matters for small entities, 
including compliance costs and other burdens that may result from 
potential changes discussed in the FNPRM. The Commission will ensure 
that any reporting, recordkeeping, or other compliance burdens are 
outweigh by the benefits of protecting the integrity of the E-Rate 
program, and by having a successful Wi-Fi hotspot lending program to 
meet the educational needs of students, school staff, and library 
patrons.
    The RFA requires an agency to describe any significant alternatives 
that could minimize impacts to small entities that it has considered in 
reaching its proposed approach, which may include the following four 
alternatives (among others): ``(1) the establishment of differing 
compliance or reporting requirements or timetables that take into 
account the resources available to small entities; (2) the 
clarification, consolidation, or simplification of compliance and 
reporting requirements under the rule for such small entities; (3) the 
use of performance rather than design standards; and (4) an exemption 
from coverage of the rule, or any part thereof, for such small 
entities.''
    In the FNPRM, the Commission seeks comment on how to ensure that 
there is educational usage of the E-Rate supported Wi-Fi hotspots and 
services. The Commission also requests comments that considers the 
impact on small entities. For example, the Commission seeks comments on 
how service providers participating in the E-Rate program for hotspot 
lending should be required to provide transparent reporting to 
applicants on data usage

[[Page 67400]]

that makes it easy for schools and libraries, and in particular small 
applicants without dedicated staff for a hotspot lending program, to 
identify the devices that are going unused. In the FNPRM, the 
Commission considers alternatives by asking if for the E-Rate program, 
it should consider the requirement of alternative billing methods, such 
as usage-based pricing models. The FNPRM also requests comments on 
whether service providers should be required to offer a simple way to 
remotely discontinue and reestablish lines when requested by applicants 
and if there are different levels of service needed depending on the 
school or library size.
    Further, the FNPRM seeks comments on potential costs and benefits 
of the proposed rule changes. The Commission expects the information 
received in the comments in response to the FNPRM will allow it to more 
fully consider ways to minimize the economic impact on small entities 
and explore additional alternatives to improve and simplify 
opportunities for small entities to participate in the E-Rate program, 
while also ensuring usage in the E-Rate funded school and library 
hotspot lending programs.
    Federal Rules that May Duplicate, Overlap, or Conflict with the 
Proposed Rules. None.

Ordering Clauses

    Accordingly, it is ordered, that pursuant to the authority 
contained in sections 1 through 4, 201-202, 254, 303(r), and 403 of the 
Communications Act of 1934, as amended, 47 U.S.C. 151-154, 201-202, 
254, 303(r), and 403, Further Notice of Proposed Rulemaking is adopted 
effective September 19, 2024.
    It is further ordered that the Office of the Secretary shall send a 
copy of the Further Notice of Proposed Rulemaking, including the 
Initial Regulatory Flexibility Act Analysis, to the Chief Counsel for 
Advocacy of the Small Business Administration.

Federal Communications Commission
Marlene Dortch,
Secretary, Office of the Secretary.
[FR Doc. 2024-18123 Filed 8-19-24; 8:45 am]
BILLING CODE 6712-01-P