FCC REVERSES COURSE ON SCHOOL BUS WIFI AND OFF-CAMPUS HOTSPOT ELIGIBILITY

On September 30, 2025, the Federal Communications Commission (FCC) issued two decisions that directly impact how schools and libraries plan for technology funding through the E-Rate program. In the first decision, a Declaratory Ruling, the FCC clarified that Wi-Fi and other access point technologies on school buses are no longer eligible for E-Rate support beginning in Funding Year (FY) 2025.

What Changed?

In 2023, the FCC had taken the position that providing Wi-Fi on school buses met the definition of an “educational location” under the E-Rate program. The reasoning was that connectivity during bus rides extended learning opportunities, especially for students in rural areas with long commutes. This perspective was also shaped by the COVID-19 pandemic, which exposed and magnified the digital divide. With remote learning becoming a necessity, many schools sought creative solutions—such as bus-mounted Wi-Fi—to ensure students without reliable home internet could stay connected and engaged in their education.

Now, the FCC has reversed that position. Citing section 254 of the Communications Act, the Commission determined that school bus Wi-Fi does not align with the statutory intent of E-Rate, which is to enhance connectivity in classrooms and on school/library premises—not in transit, or “off-campus”.

The ruling states that extending E-Rate to cover bus Wi-Fi was “not the best reading” of the statute. As a result, all FY 2025 E-Rate funding requests for school bus Wi-Fi will be denied by USAC (the Universal Service Administrative Company). However, the FCC will not apply its decision retroactively to previously requested and granted funding requests for FY 2024.

What About Hotspots?

The FCC also issued an Order on Reconsideration which declared that the provision of hotspots for off-campus use does not qualify as an E-Rate-eligible service. The FCC views both bus Wi-Fi and lending of hotspots for off-campus use as falling outside of the core purpose of the program, which is to fund on-site connectivity for classrooms and libraries.

What This Means for Schools & Libraries

• Budgeting Considerations – If your district or library had planned to include bus Wi-Fi or hotspots for off-campus use in future E-Rate applications, those costs will now need to be covered through other funding sources or local budgets.

• FY2025 Applications – Any funding requests for school bus Wi-Fi or hotspots for off-campus use for FY2025 will be denied.

• Strategic Focus – The FCC’s decision re-centers the E-Rate program strictly on supporting on-campus connectivity, making it essential for schools and libraries to refine their competitive bidding and application strategies with this narrower scope in mind.

  
  

CSM’s Take

While this ruling may feel like a setback—particularly for rural and high-need communities that saw bus Wi-Fi and lending of hotspots for off-campus use as a bridge to digital equity—it also clarifies the FCC’s interpretation of what counts as an “educational location” under E-Rate. For technology staff, the key is to plan ahead: ensure your FY2026 procurement and application strategies are aligned with the updated eligibility guidelines.

Currently, members of Congress are re-examining programs like E-Rate that are funded through the Universal Service Fund. Now is the time to educate your members of Congress of the importance of the E-Rate program and how it might be improved to meet the needs of schools and libraries in their mission to provide universal broadband access to students and patrons.

CSM Consulting will continue to monitor FCC and USAC updates closely and provide guidance to help your district or library make the most of the E-Rate program.