The FCC has announced updated Category Two (C2) budget amounts for Funding Years 2026 through 2030. These changes represent a significant opportunity for service providers and manufacturers supporting schools and libraries as they plan for upcoming network upgrades and modernization efforts.
The new budget cycle reflects increased investment in internal connections and reinforces the importance of long-term infrastructure planning.
Several key updates will impact how applicants approach Category Two funding over the next five-year cycle.
The minimum C2 funding floor for small school districts has increased from $25,000 to $30,175 per site for districts with up to 10 sites. This adjustment provides additional flexibility for smaller applicants to pursue meaningful internal connections projects.
The per-student Category Two budget multiplier has increased from $167 to $201.57. This change expands funding capacity for schools seeking network upgrades, equipment refreshes, and expanded connectivity solutions.
For libraries, the per-square-foot budget multiplier has risen from $4.50 to $5.43, supporting continued investment in modern network infrastructure and technology enhancements.
These updated Category Two budgets create several strategic opportunities:
A new five-year C2 funding cycle begins in FY2026
Increased demand for networking equipment, internal connections, and related services
Greater opportunity for long-term partnerships and phased deployments
As applicants evaluate their expanded budgets, service providers and manufacturers are well positioned to support planning, procurement, and implementation efforts.
With higher budget thresholds and a new funding cycle underway, FY2026–2030 is shaping up to be a high-impact period for Category Two investments. Organizations that understand C2 eligibility rules and budget mechanics will be better positioned to support applicants as they take advantage of these new funding levels.
E-Rate continues to play a critical role in enabling modern, reliable connectivity for schools and libraries, and these updates reinforce its long-term importance.