Cash rolling in

Well, it's official: the FCC is rolling over $1 billion in unused funds. Interestingly, they're rolling $900 million into the current (2009-2010) funding year, and saving $100 million for the 2010-2011 funding year. I've speculated in the past that the unusually large rollover this year is a one-time bump caused by some accounting changes at USAC, and next year we'lll be back to the more typical level ($600 billion or so). Apparently, the FCC wants to spread the wealth a little bit.

So what will be the denial threshold for 2009-2010? I'm too swamped to really do any real analysis, but let's take a quick look:
With a $900 million carryover, the total funding available is $3.15 billion.
Priority One requests are about $2 billion.
Priority Two requests from 90% applicants are $800 million.
Priority Two requests from 80-89% applicants are $1 billion.
Let's assume USAC denies 15% of the funding requests received. (I think I read that E-Rate Central had figured out that the post-Bishop Perry rate was around there).

In that case, we'd need $2.4 billion to cover P1 and the 90-percenters. We'd need $3.2 billion to have an 80% denial threshold. If we assume that funding requests in the 80%-90% band are evenly distributed, the denial threshold will be 82%. Me, I think USAC is serious about helping more people get approved, so the actual denial threshold will be 84%. We'll know in a year or so.

Anyone care to start a pool?

Notice how my analysis doesn't mention the 2-in-5 rule? That's because the 2-in-5 rule doesn't work. (What, you thought I would mention the denial threshold without beating my favorite dead horse? How long have you been reading this blog?)