In South Central Illinois, nearly 1 in 5 families at Bunker Hill Community Unit School District 8 don’t have access to reliable broadband internet at home, said Todd Dugan, the district’s superintendent.
The rural 620-student district stretches across 70 square miles between its two schools — one for grades pre-K-8 and the other a high school. Students’ lack of internet access, Dugan said, isn’t solely because of the cost: The infrastructure is simply not there.
To address that need, Bunker Hill CUSD 8 distributed 100 internet hotspots that students could take home to complete their schoolwork, Dugan said. That was made possible through a partnership with wireless network carrier T-Mobile, which gave the hotspots to the district at no charge between December 2020 and December 2025.
Dugan originally planned to use federal E-rate funds to fill the gap when that deal expired. That plan came to a halt in September, however, when the Federal Communications Commission repealed a Biden-era expansion of the E-rate program that helped schools and libraries receive significant discounts for school bus Wi-Fi and internet hotspots.
The FCC’s expansion of E-rate to cover those additional services came in two votes — one in 2023 for school bus Wi-Fi and the other in 2024 for internet hotspots. The moves were geared toward helping address the “homework gap,” or the disparity between students who can and can’t complete off-campus school assignments as a result of their access or lack thereof to home internet.
Before the FCC reversed course, schools demonstrated a high demand to use the federal program for these additional services. For example, schools and districts requested $42.6 million in E-rate funds for hotspots and $15.3 million for school bus Wi-Fi during fiscal year 2025, according to federal data.
If Bunker Hill CUSD 8 was to pay for the 100 hotspots on its own for students now, Dugan said, it would cost the district about $14,000 a year.
For a small rural school district with a $6 million operating budget, Dugan said, “that’s a lot to swallow” — especially as school districts like Dugan’s are already taking hits to their budgets elsewhere while facing financial uncertainty from state and federal governments.
How districts are navigating costs
The sudden backpedal on E-rate support for school bus Wi-Fi and hotspots has had “significant” impacts on school districts, said Michael Flood, who consults on E-rate services and is founder and CEO of technology consulting firm Alpine Frog.
The FCC’s decision occurred in the middle of the funding cycle for E-rate, Flood said. That means districts that had already spent money on hotspots or school bus Wi-Fi and were expecting to receive federal reimbursements never got the money to cover those services, he said.
“So that led to some districts having to terminate those programs immediately to stop the bleeding of revenue,” Flood said. Meanwhile, other districts were “trying to find other funding sources to make up that difference to pay service providers what had already elapsed before the decision came out, or to continue their services through the end of this academic year.”
The other option that Dugan said he will likely pursue at Bunker Hill is to have his district offer fewer hotspots and restrict the devices to students who need them the most.
At the same time, low-income urban school districts are also feeling the brunt of the E-rate expansion reversal — from both an infrastructure and affordability perspective.
In 2024, about 24% of the nearly 70,400 students in California’s Fresno Unified School District had access to a strong, reliable internet connection, according to an analysis by Philip Neufeld, executive officer of strategic research at the district.
While Fresno USD was issuing hotspots to students before the COVID-19 pandemic, Neufeld told K-12 Dive that the districts’ funds for the devices have since dwindled. At peak levels during the pandemic, the district scaled up the number of issued hotspots to at least 10,000 devices, Neufeld said.
The district still continues to prioritize offering students Wi-Fi on 101 school buses, a service it’s had since 2017, Neufeld said, which he said costs the district about $50,000 annually.
Without federal support for programs like E-rate, particularly for hotspots and school bus Wi-Fi, it’s harder for district leadership to get onboard with fully covering the costs on their own, Neufeld said. Fresno USD is also going through “major budget cuts,” Neufeld said, but the student need for hotspots “didn’t go away.”
The student impacts
Before the FCC reversed its E-rate expansion, Sen. Ted Cruz, R-Texas, previously said in a statement that hotspots paid through the broadened federal program were “illegal” and a “blatant overreach by a partisan agency.” He added that hotspots could expose students to inappropriate content that parents can’t control.
However, school devices — including hotspots and school bus Wi-Fi — are required to have content filters to ensure appropriate student use. Neufeld said that Cruz doesn’t understand that school devices are secure with those content filters and don’t allow students to go on social networks.
The reversal of E-rate expansion ultimately took away a “lifeline” for students in rural and low-income urban areas, Neufeld said.
For Dugan, the E-rate cuts are a “step backwards” that will further exacerbate already existing digital inequities among students.
“You're going to have suburban and urban kids being able to access probably very powerful search engines — AI, research and things like that,” Dugan said. “And you have kids that, because they're born at the end of a road with only two other houses, they'll be lucky to ever watch or stream a video, or if nothing, at least maybe check email.”
