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Calculating The Discount Rate
E-Rate Discounts

E-Rate discounts are based upon two factors:

  1. the poverty level of students as determined by eligibility to participate in the National School Lunch Program (NSLP)
  2. the urban or rural designation

Applicants compare these two data points to the Discount Matrix to determine their overall discount percentage.

  1. For Category One, discounts range from 20% to 90% of the costs of eligible services.
  2. For Category Two, discounts range from 20% to 85% of the costs of eligible services.

Factor 1: Poverty Level
Poverty Level Determination for Individual Stand-alone Schools

Stand-alone schools that are not part of a district use their own National School Lunch Program data as reported to the Maine Department of Education. The data that appears on the Free and Reduced Lunch Report   dated October of the school year previous to the application's funding year should be used.

Schools that do not have a school lunch program are still eligible if they meet other compliance rules. These schools will need to use an alternative discount mechanism to calculate student eligibility. Students from households whose income is at or below 185 percent of the federal poverty guideline are considered to meet the eligibility requirement to participate in NSLP.

  • Technical centers or alternative education centers whose students come from other schools can collect NSLP eligibility information from each student's sending school.
  • Independent schools such as private schools and charter schools must survey families to determine low-income status and/or participation in an acceptable program (e.g. Medicaid, SSI).

Independent charter schools, private schools, and other eligible educational facilities should calculate a single discount percentage rate based on the total number of students under the control of the central administrative agency.

Stand alone schools calculate their E-Rate discounts by:

  1. dividing the total number of students who are eligible for NSLP at their school by the total number of students attending the school and
  2. comparing that single figure against the discount matrix to determine the school's discount rate for E-Rate supported services
Poverty Level Determination for School Districts and Schools Belonging to a District

Discounts for school districts are calculated for the organization as a whole. Each school district is required to calculate and use a single district-wide discount rate, rather than calculating and using building-by-building discount rates.

The discount rate for the district does not change based on which member entities within the district are receiving the E-Rate eligible service.

Individual schools within a district never get their own discount rate, even if they are the only school receiving that service. When eligible, non-instructional facilities (NIFs) get the same school district discount.

School districts and schools belonging to a district will calculate their E-Rate discounts by:

  1. dividing the total number of students in the district who are eligible for NSLP by the total number of students enrolled in the district and
  2. comparing that single figure against the discount matrix to determine the discount rate for E-Rate supported services for the school district (and each school within the district)

School districts should use the National School Lunch Program data as reported to the Maine Department of Education. The data that appears on the Free and Reduced Lunch Report   dated October of the school year previous to the application's funding year should be used.

Poverty Level Determination for Libraries

Libraries use the National School Lunch Program data for the school district in which the library is physically located. The data that appears on the Free and Reduced Lunch Report   dated October of the school year previous to the application's funding year should be used.

Library systems that have branches or outlets in more than one public school district will use the address of the central outlet or main administrative office to determine which public school district the system is in.

Poverty Level Determination for Non-Instructional Facilities

A non-instructional facility (NIF) uses the discount percentage of the district to which it belongs.

Poverty Level Determination for Facilities Under Construction

For schools under construction, the applicant makes an educated guess of what the student population will be.

Factor 2: Urban or Rural Designation
Definition of Urban and Rural

The definition of "rural" and "urban" is based on US Census data. An individual school will be designated as "urban" if it is located in an "Urbanized Area" or an "Urban Cluster" with a population of 25,000 or more as determined by the U.S. Census Bureau.

The FCC has indicated the following designations:

  • Populations under 25,000 are considered to be rural
  • Populations of 25,000 or more are considered to be urban

Note that an "Urbanized Area" or an "Urban Cluster" is a geographic shape encompassing more than one physical city. In Maine, the following cities are part of an urban area or urban cluster meeting the definition of urban, and schools located in these cities would be considered urban. All other locales are rural.

Urbanized Area or Urban Cluster Cities Included
Bangor Urbanized AreaBangor, Brewer, Hampden, Milford, Old Town, Orono, Veazie
Brunswick Urban ClusterBath, Brunswick, Topsham
Lewiston Urbanized AreaAuburn (parts), Lewiston, Lisbon Falls, Sabattus
Portland Urbanized AreaBiddeford (parts), Cape Elizabeth, Cumberland, Cumberland Center, Falmouth (parts), Freeport, Gorham (parts), North Windham, Old Orchard Beach, Portland, Saco, Scarborough, South Freeport, South Portland, South Windham, Westbrook, Windham, Yarmouth
Waterville Urban ClusterBenton, Fairfield, Oakland (parts), Waterville, Winslow
Portsmouth, NH-ME Urbanized AreaBerwick, Eliot, Kittery, Kittery Point, Lebanon, South Berwick, York
School Building Urban or Rural Designation

Any school not designated as "urban" using the definitions above will be therefore be designated as "rural" and would be eligible to receive the rural discount.

USAC has an urban/rural lookup tool   on their website that can be used to look up individual BENs.

District Urban or Rural Designation

An urban or rural status is also determined at the district level. A district is only considered to be rural if more than 50% of the schools within the district are established as rural.

Therefore:

  • If exactly 50% of the schools within the district are rural, the district is considered to be urban.
  • Or if less than 50% of the schools within the district are rural, the district is considered to be urban.
  • But if more than 50% of the schools within the district are rural, the district is considered to be rural.

Non-instructional facilities do not get an urban/rural status and are not counted in the determination of whether more than 50% of the schools are rural.

Library Urban or Rural Designation

Libraries will take the urban or rural designation of whatever school district they are physically located in.

Library systems that have branches or outlets in more than one public school district will use the address of the central outlet or main administrative office to determine which public school district the system is in.

 
Discount Matrix

Use the discount matrix to determine a discount based on the percentage of
students qualifying for NSLP and the urban/rural location designation.

  Category One
Discount Level
Category Two
Discount Level
% of students eligible for the National School Lunch Program URBAN discount RURAL discount URBAN discount RURAL discount
Less than 1% 20% 25% 20% 25%
1% to 19% 40% 50% 40% 50%
20% to 34% 50% 60% 50% 60%
35% to 49% 60% 70% 60% 70%
50% to 74% 80% 80% 80% 80%
75% to 100% 90% 90% 85% 85%