Reflections on the 25th Anniversary of the Telecommunications Act of 1996
Part II: The E-Rate Provision
A growing concern as we considered telecommunications reform efforts in the early 1990s was the creation or emergence of a “digital divide.” It is an issue that remains with us today. The COVID-19 quarantine and remote learning over the last year has highlighted the consequences of not fully connecting everyone in the nation, especially all of our youth.
In the early 90s, there was a desire to harness the awesome power of advanced, digital communications services to enhance education. My boss, Chairman Markey (D-MA), was concerned, however, that wealthy households would obtain computers and access to the information riches of the emerging “information superhighway” in ways that would naturally advantage their children educationally, while less wealthy households would fall behind. There was a risk that de facto electronic redlining in deploying new infrastructure and services would unfold, disadvantaging minority households. So we started to raise alarm bells about this. For example, on October 18, 1993, Chairman Markey gave remarks at the Computerland Summit, in which he highlighted the risk of a looming informational divide:
“We have a tremendous opportunity to seize new markets, create jobs, and, at the same time, develop a rich new realm of creative venues for entertainment and learning. But with this opportunity comes the potential for great danger. In our headlong pursuit of profit and growth, we could create an ‘information apartheid’ — a nation of information haves and have-nots….Already today, we see the broad outlines of the new trend toward information inequality. Some families are wired for cable; others are not. Some get Sports Channel or HBO; many do not. More importantly, some kids today can use online services at home to do research for a school project. Most kids, however, are lucky if they have access to a computer at school. Wealthy school districts connect to the Internet; most schools in America don’t even have phone jacks in the classroom.” (video at 31:52)
We also found a powerful ally. In August of 1993, one of the most memorable moments for me as a telecommunications policy staffer for Chairman Markey, including as his eventual lead staffer on TA96, was when he and I had lunch at the Willard Hotel in Washington with filmmaker/producer George Lucas of Star Wars fame. Mr. Lucas had founded The George Lucas Educational Foundation and was quite interested in educational technology issues. Over lunch, Mr. Lucas and Chairman Markey talked about their shared goal of ensuring that the upcoming effort to overhaul the nation’s telecommunications laws would include provisions to enhance education and equality of opportunity. They quickly agreed that every classroom and public library should be connected, and also discussed the benefits of including other community anchor institutions as well.
Foreshadowing an issue for the E-Rate that we are contending with today, Mr. Lucas also proposed that not only every K-12 school have access to the “information superhighway,” but that every student get it for free for educational purposes at home, too, perhaps by connecting kids at home through the school. Chairman Markey asked Mr. Lucas to testify, which he eventually did. (Mr. Lucas would later return to appear before the House committee again in June, 2008, as a follow-up a decade after implementation of the E-rate).
At the forefront of policy today for the E-rate is to find a solution to the so-called “homework gap.” What do we do for the millions of kids who lack Internet access at home when COVID-19 shutters schools and public libraries? In 1993, after the lunch Chairman Markey and I had with George Lucas, we started to explore the cost to do this. At the time I was advised that the cost was either unknowable or astronomical, but clearly it would be in the tens of billions of dollars range. The free-Internet-for-kids “at-home” provision was dropped due to cost concerns, but our proposal for connecting all K-12 schools and public libraries in the nation moved forward. Today we can query whether the cost of not providing the Internet at home is too high, as millions of schoolchildren suffer during COVID-19.
To probe the intentions of the industry and build support for a national plan, Chairman Markey tasked me in December of 1993 with drafting an oversight letter to the CEOs of the top 10 telephone companies and the top 10 cable companies in the nation, asking whether they would connect local K-12 schools to the “information superhighway” for free. Since we were actively working on draft legislation, it would be important to know what their corporate intentions and thoughts were about connecting such educational institutions at an affordable rate. The educational implications of the rise of digital technologies and the communications competition we intended to unleash were too great not to have a plan. When responses to this oversight inquiry returned in January 1994, only three of the 20 companies indicated they were willing to provide high speed telecommunications connections to K-12 schools, although how such connections would be paid for was left ambiguous. Clearly we needed a plan if we were going to address the looming digital divide in educational access in schools. So lead Rep. Markey counsel Gerry Waldron and I got to work drafting a plan. In addition to our goal of connecting schools and public libraries, we also sought to include a “telemedicine” element to the policy as well.
We developed a plan in time for marking up the legislation that Chairman Markey had negotiated with his good friend and Ranking Republican on the Subcommittee, Rep. Jack Fields (R-TX): the Markey-Fields bill (HR 3636) which now included requiring a Federal Communications Commission (FCC) proceeding to establish preferential rates for advanced telecommunications services to educational institutions, health care entities, and public libraries. The name “E-rate” (for “education rate”) was eventually coined by Rep. Markey to describe this regulated, preferential rate to K-12 schools and libraries. During House Telecommunications Subcommittee and Full Committee consideration of the bill, the E-rate provision was briefly expanded to include preferential rate access to community colleges and museums in addition to K-12 schools and public libraries. We had the support of the American Library Association, the National Educational Association, and many public interest groups. Consumer groups, however, were a bit wary about the potential impact on consumer residential phone bills, but basically understood why we wanted to move forward with this proposal as a matter of national priority. Eventually, the expansion in eligibility for community colleges & museums was pulled back by the time we got to the House floor, again due to cost concerns, and the final language therefore focused once again on providing access and support to K-12 schools and classrooms, public libraries, and health care institutions. This itself was quite ambitious at a time when most Americans had not even been on the Internet.
When we brought H.R. 3636 to the House floor for a vote on June 28, 1994, Chairman Markey noted the various provisions of the bill dealing with the telecommunications companies. He then raised the E-Rate provision and said, “I believe that there is perhaps no more important societal benefit to upgrading our Nation’s information infrastructure than uplifting the hopes, dreams, and aspirations of millions of schoolchildren through increased access to information in America’s elementary and secondary schools.” The bill passed. Members on both sides of the aisle hailed the collaborative, bipartisan result we had achieved on this significant piece of legislation, which had many moving parts and affected many industries. Chairman Markey also noted the strong endorsement for the legislation from Vice President Gore and members of the Clinton Administration, which we knew was due in no small part to growing interest in seeing our E-Rate provision become law.
Though the House bill died in the Senate in the fall of 1994, we had helped to put the principle of connecting K-12 school classrooms and public libraries on the national agenda. In short, we had made it politically integral to the ultimate passage of TA96.
By 1995, with the GOP now in control of Congress and held the proverbial gavel at all the congressional committees. In this new Congress, as opposed to what happened in 1993–94, the Senate side of the Hill would move telecommunications legislation forward first. Once again, as I explain in Part I, most of the key telecommunications issues had been debated ad nauseam over the prior few years and staff were well-acquainted with each other and the substance and were ready to go. Most of the policy questions did not break along partisan, party lines but instead along regional or philosophical lines. Media ownership and cable rate deregulation were on the table in the Senate in the same way they were in the House and this provided fodder for new controversy.
A group of staff for key Senators had been meeting over a number of weeks, focused on the needs of rural America as part of the telecommunications law overhaul. This group of staffers would name themselves informally the “farm team.” As they focused on the general availability and affordability of phone service and cable service in rural America, they began to zero in on the question of connecting schools and libraries to new enhanced telecommunications services, as the Markey-Fields bill had done in the previous session of Congress. The farm team was quite focused on these universal service questions. Senate staffers Greg Rohde (Sen. Byron Dorgan (D-ND)), Carol Ann Bischoff (Sen. Bob Kerrey (D-NE)), Chris McLean (Sen. Jim Exon (D-NE)), Cheryl Bruner (Sen. Jay Rockefeller (D-WV)), and a few others led the Senate discussions on rural issues on the Democratic side on the telecommunications bill.
Sen. Hollings, the lead Democrat on the Senate Commerce Committee, also had a keen interest in ensuring that rural America was protected and would benefit from the Telecommunications Act legislation, given the largely rural nature of his state. One of his counsels, Kevin Joseph, had learned that over on the Republican side of the aisle, Senator Olympia Snowe (R-ME) had a strong interest in connecting schools and libraries. However, the Republicans were not including Sen. Snowe’s staff in their internal deliberations prior to the Senate Commerce Committee markup. Meanwhile, on the Democratic side, Senator Rockefeller was drafting his own rural telemedicine amendment. The night before the Senate markup, Joseph suggested to Sen. Rockefeller’s staff, Cheryl Bruner, and Senator Snowe’s staff, Angela Goodhart, that they combine their two amendments to see if they could come together on a joint, bipartisan proposal for connecting schools, libraries, and health care institutions. Adding other “farm team” staffers, they developed language to bring forward as an amendment at the Senate Commerce Committee markup.
Senator Snowe offered the amendment in the Committee markup. Surprisingly, in contrast to the experience we had just had a few months earlier in the House when passing the E-Rate provision in the House as part of the Markey-Fields bill, the idea of creating a new program to connect schools and libraries engendered Republican opposition on the Senate Commerce Committee. Sen. John McCain (R-AZ) was opposed to the proposal, as were other GOP members, including Chairman Pressler (R-SD), Senator Trent Lott (R-MS), and Senator Bob Dole (R-KS). In general, they were a bit wary of the cost of the program and some felt raising the funds through an extra fee on consumer telephone bills was effectively a new tax, and they wanted to scale it back.
The Senate Commerce Committee at the time, due to the fact that the margin between Republicans and Democrats in the full Senate was so close, was almost evenly split by party, with 10 Republicans and nine Democrats on the panel. By combining the separate Snowe and Rockefeller amendments together, Senator Snowe, with support from all the Democrats, could prevail by a single vote. At the mark-up, Republicans beseeched Senator Snowe to withdraw her amendment, stipulating that if she did so they would work with her to come up with a different proposal that could win over more Republicans on the Senate floor. Her staff came over to Kevin Joseph at the markup, asking for advice and input as to what Sen. Snowe should do. He replied that if Sen. Snowe withdrew the amendment in the mark-up they’d never see it again in its present form and that this was their moment of greatest strength. Sen. Snowe stuck to her guns and insisted on a vote and it passed 10–9. This was the only amendment adopted on a 10–9 vote with one Republican Senator joining all nine Democrats.
Meanwhile, Larry Irving, a former Markey mass media counsel who was now head of the National Telecommunications and Information Administration (NTIA) at the Commerce Department was developing the trailblazing “Falling through the Net” reports, the first of which appeared in July 1995. These reports highlighted the growing chasm in our society on access to the Internet and underscored strongly the need for policies to mitigate this deficiency. Larry’s efforts at NTIA helped create greater public awareness on the issue and bolstered our hand on Capitol Hill as Rep. Markey and others pushed for Congress to act and to ensure that, amidst the clash of tech industry titans in the deliberations on the telecommunications bill, we derived the public interest benefit of connecting schools and libraries as one tool in addressing inequality.
In the House-Senate conference, Senators Snowe, Dorgan, and Kerrey weren’t conferees, but other “farm team” members were, and there was growing sense that the E-Rate needed to be in the final bill to gain Administration support. Since a Presidential veto had been threatened earlier in the process, largely because of the media ownership and cable price deregulation provisions, the situation was quite fluid and every compromise was fragile until we could file the conference report and put it to bed. In addition to dealing with the controversial provisions around media ownership and cable rate deregulation, there was a sense that including several provisions — the E-Rate, the V-Chip/TV ratings, and some others — would help merit a presidential signature. In general, the new Republican majority was carefully navigating a route toward passage and trying to figure out how many “sweeteners” to put in for the Democrats, in order to maintain bipartisan buy-in for the overall bill. Indeed, on the Republican side, House Commerce Committee Chairman Tom Bliley was instrumental in helping to keep the provision in the bill and told Rep. Markey at one point during the conference, only half-jokingly, “Ed, your school program is going to be around a long time after you and I are both gone, since we’re not too good about getting rid of programs.”
We also knew that once we had succeeded in getting this behemoth law over the goal line, the FCC would be tasked with significant work to implement its many provisions through rule-makings, including the E-Rate. The Chairman of the FCC, Reed Hundt, was a champion for the E-Rate. He had vocalized his strong support for connecting schools over the years and for our legislative efforts as we developed our E-Rate proposal and fought to get it enacted on Capitol Hill.
Today, the E-Rate is the largest education technology program of the Federal government and it isn’t even in the Department of Education, but rather over at the FCC. Over the past 25 years, the E-Rate program has provided over $50 billion in subsidized service to schools and libraries across the country. On its 25th anniversary, millions of schoolkids and citizens can be grateful for the E-Rate’s existence even as we look to ways to build upon it and improve it.
Part III will look more closely at the legislative history of Section 230.
