Category 2 Budgets for FY 2020

FY 2020 is a transitional funding year for Category Two products and services, which include internal connections, managed internal broadband services, and basic maintenance of internal connections.  Category 2 services had been provided on a five-year prediscount basis beginning in FY 2015.  For FY 2020, Category 2 budgets have been extended for a sixth based on the number of students in a school or the square footage area of a library.

Category 2 budgets are pre-discount. That is, the pre-discount cost of the products and/or services approved for E-rate discounts is charged against the Category 2 budget. For planning purposes, USAC also provides the "post-discount" budget amount – the cost to the applicant of the Category 2 products and services after the E-rate discount is applied.

E-Rate discount rates for Category 2 are calculated just as for Category 1 services with the exception of 90% eligible entities. The highest Category 2 discount rate is 85%.

The total prediscount Category 2 budget for the six-year period FY 2015-2020 is based on the following measures:

  • $195.63 per student for schools
  • $6.52 per square-foot for urban libraries (locale codes 11, 12, or 21)
  • $3.00 per square-foot for all other libraries
  • Minimum $11,998.43 per site for any school or library

The prediscount Category 2 budget for FY 2020 is equal to the total FY 2015-2020 budget minus any funds already committed during the preceding five years.  Applicants wishing to calculate their remaining Category 2 budget for FY 2020, on a prediscount basis, should use the new Category 2 Budget Tool provided by USAC (see FY2020 C2 Budget Tool – Instructions).

One problem with the new tool is that it displays budget data in the form of a large Excel spreadsheet with 14 columns, as shown below, many of which are unneeded and most of which are locked.

E-rate Category 2 Budget Excel spreadsheet

To simplify the use of USAC’s spreadsheet tool, E-Rate Central has created additional Category 2 Budget Templates.  By cutting and pasting data from the USAC tool into one of these templates, users can manipulate the data (e.g., by summing budget information for multiple entities) and can print a more readable spreadsheet showing only the important columns, e.g.:

USAC's E-rate Category 2 Budget Tool

To use E-Rate Central’s simplified Category 2 Budget Template, please do the following:

  • Add the “As of” date.
  • Cut and paste (using the Paste Value option) columns of data from the USAC tool into the template.
  • Note that the templates include hidden columns to match the USAC tool.  This means, for example, that you can copy the data from Col. M of the USAC tool into Col. M of the template.
  • Note also that the Entity Name column, which in the USAC spreadsheet merges two columns (Col. D-E), has to be cut and pasted separately.
  • Add column totals as necessary.


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