Quick answer
E-Rate does not pay for phone service. Support for voice services, including interconnected VoIP, was phased out and ended with funding year 2019. E-Rate can still support some of the network that carries voice traffic, such as Internet access and data circuits, and some internal network equipment. Check the current eligible services list before you count on any discount.
This is a plain-English summary, not legal or funding advice. Program rules change each funding year. Confirm eligibility with USAC and your E-Rate consultant.
1. What changed
In 2014 the Federal Communications Commission adopted the E-Rate Modernization Order, which phased down support for voice services. The discount rate for voice was reduced by 20 percentage points every funding year beginning in funding year 2015, and voice services have not been eligible since funding year 2019. The Order applied the phase-down to telephone services and to circuit capacity dedicated to voice, including local and long distance service, wireless (cellular) service and interconnected VoIP.
The same Order also ended support for several related items, including paging, voicemail, and telephone and voice-over-IP components in the internal connections category.
2. What is not covered
- Telephone service, including VoIP service
- Circuit capacity dedicated to voice, including SIP trunks that carry calls
- Telephone and VoIP components: phones, handsets and the phone system itself, whether hosted or on site
- Paging and voicemail
Because phone service is not eligible, a quote that combines phones and network services should show the eligible and ineligible parts on separate lines.
3. What may still be covered
The program describes two categories. Check the current list for your funding year.
- Category 1: connections. Internet access and data transmission to and between sites, such as wide-area network circuits. A circuit that carries VoIP traffic along with other data can be eligible as a data connection. Capacity dedicated to voice is not. Ask how a mixed circuit is allocated.
- Category 2: inside the building. Internal connections that distribute broadband, such as routers, switches, wireless access points, internal cabling, racks, wireless controllers, firewall services and uninterruptible power supply, plus basic maintenance and managed internal broadband, within each applicant's Category 2 budget. This is the list in the 2014 Order. Check the current list for your funding year.
4. Questions to ask before you budget
- Which parts of the quote are phone service, and which are network services?
- Does the provider itemize them so each can be treated correctly?
- Is the circuit that carries our calls already covered by an E-Rate application we file for data?
- Would the network upgrade a phone project needs (switches, power, wireless) fit in our Category 2 budget?
- What are the competitive bidding and filing deadlines for the funding year we are targeting?
5. How this affects a phone decision
Do not assume that a phone project can be funded through E-Rate. Model the phone system on its own cost, as in The Hidden Cost of K–12 Phone Systems, and treat any E-Rate support for the network as a separate, possible saving. Ask your counsel or consultant before you rely on it.