I smell a pro-rata

Now it's starting to get my goat.  In a recent appeal decision, the FCC denied appeals from 90% applicants who thought they should have gotten some Priority Two funding in FY 2013-2014.  The FCC denied the appeal.  I actually don't have a problem with that.  Here's what has me frowning: "In funding year 2013, there were insufficient funds available to fund any priority two requests."  Untrue.  There were insufficient funds to follow the established precedent of funding applicants at a particular discount level only if there is enough funding available to fully fund all applicants at that level.  But there was some funding available.  According to USAC's Q2 Fund Size Projections, there were at least $600 million ready for rollover on january 31, 2013.  Also, there was $250 million available in the FY 2013-2014 pot.  On January 24th, Chairman Wheeler blogged that "As part of our top to bottom review of E-Rate, the opportunity has opened to use existing funds to immediately begin to expand E-Rate funding targeted to high-speed connectivity to students in schools and libraries."  So on January, the FCC had $850 million available, plus whatever Chairman Wheeler wanted to leverage out of the fund.  The denial of P2 requests for 90% applicants wasn't approved by the FCC until February 24th, and the first denials weren't until March 5th.

Maybe the FCC couldn't have funded the entire $1.76 billion in Priority Two requests from 90% applicants.  But there is a procedure for that in 47 C.F.R. 54.507(g)(1)(iv): "If the remaining funds are not sufficient to support all of the funding requests within a particular discount level, Schools and Libraries Corporation shall divide the total amount of remaining support available by the amount of support requested within the particular discount level to produce a pro-rata factor. Schools and Libraries Corporation shall reduce the support level for each applicant within the particular discount level, by multiplying each applicant's requested amount of support by the pro-rata factor."

I have no objection to the FCC refusing to pro-rate.  I think pro-rating would be a disaster.  But it bothers me when they act like it was impossible for them to fund any applicants.  The FCC chose not to fund any P2 requests, and had to waive its own rules to do so.

At least I won't have to complain about this in the future: as I had suggested, in the 7R&O, the FCC abolished pro-rating (see 47 C.F.R. 54.507(f)(4) on page 134).