Honorable Earl Blumenauer
House of Representatives
Washington, DC 20515

Dear Mr. Blumenauer:

Thank you for your letter to President Bush expressing support for the E-rate program. Your letter has been referred to the Department of Education for response.

The Administration has proposed a consolidation of our nine education technology programs into a new Education Technology State Grants program but has not included the E-rate program in this proposal. The proposed consolidation of our programs into a single, performance-based grant program would provide states and districts with increased flexibility while reducing paperwork burden. This new program, for which the Administration has requested $817 million, would get more funding directly to schools to provide for activities such as, but not limited to, teacher training in technology, software and hardware purchasing, and other locally determined activities.

The President's 2002 budget proposes administrative changes to the E-rate program in keeping with the President's education reform principles of increasing state and local flexibility while demanding results. A provision within the 2002 budget (section 623 of the proposed Commerce/Justice/State General Provisions) directs the Federal Communications Commission to complete a rulemaking to revise certain elements of the program. The proposed changes include: (1) allocating E-rate discounts by a need-based formula; (2) including teacher training and software as eligible services; and (3) measuring the effectiveness of the E-rate program in improving student performance. The Administration believes that making the E-rate a more flexible program will enable local administrators to better utilize E-rate discounts to meet their unique, local needs and more effectively support student achievement.

Thank you for your interest in our education technology programs.