A US appeals court Friday upheld a US$2 billion annual federal program to subsidize Internet connections for schools and libraries.
The Court of Appeals for the Fifth Circuit backed the Federal Communications Commission's decision to allow the subsidies to be used to pay directly for Internet access as well as needed internal wiring at schools and libraries. Major telephone carriers like GTE Corp. had argued the money could only be spent on telecommunications services.
Thousands of schools and libraries around the country connected to the Internet thanks in part to the program created in the 1996 Telecommunications Act and known as the education rate or e-rate.
Republicans in Congress and some local telephone companies complained that the program, paid for mostly by levies on consumer long-distance bills, was never intended to pay for non-telecommunications services or internal wiring.
In Friday's decision, a three-judge panel of the court rejected those arguments, finding that the FCC had acted properly and within the 1996 law's sometimes ambiguous constraints.
"Although we agree with GTE that the statute and its legislative history do not support the FCC's interpretation, the language of the statute is ambiguous enough to require deference," the court wrote in a lengthy opinion released late on Friday.
