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Discount Rate Factors

How to determine discounts rate factors?

Three factors determine the E-rate discount rates for schools:

  • Percentage of students in the school district who are eligible for free or reduced lunch via the National School Lunch Program
  • Rural or Urban status USAC Urban/Rural Report Tool
  • Whether the application is for Category 1 or Category 2 service.

The higher the Free or Reduced percentage, the greater the E-rate discount, which is further increased for rural districts. USAC’s E-Rate Discount Matrix shows the discount rates for each combination of Free or Reduced rate and Rural/Urban status.

E-rate discounts for libraries are determined by the discount rate of the school district they are located in.

How School Districts Determine Free/Reduced Percentages

School districts report the percentage of students who have applied for free or reduced lunch to DPI, and DPI then posts the information for every school in the State on this website, when it becomes available. This is the most common and straightforward way for districts to determine their E-rate discount rate.

Students who have not applied for free or reduced lunch are still eligible, so districts who have reason to believe that eligible families have not applied can survey their families to determine their income. Students are eligible for free or reduced lunch if their family income is not more than 185% of the federal poverty guideline.

There are additional ways that a district can determine its discount rate that is detailed on the USAC site, including

  • Collecting data by surveying
  • Collecting Income Data
  • Collecting Alternative Measures of Poverty
  • Using Data That Has Been Previously Collected
  • Combining Data
  • Community Eligibility Provision (CEP)