What is Category 2?
Published May 7, 2026
Category 2 (C2) covers the internal network equipment and internal-broadband services inside a school or library — switches, wireless access points, structured cabling, firewalls, and internal-broadband-services (IBS) contracts. Category 2 funding is capped per applicant on a five-year budget cycle.
What services are eligible under Category 2?
Category 2 covers Internal Connections (IC) — switches, routers, wireless access points, controllers, structured cabling, racks, UPS — plus Basic Maintenance of Internal Connections (BMIC) and Managed Internal Broadband Services (MIBS).
The Eligible Services List for each funding year defines exactly what is and isn't covered. Items like phones, end-user devices, and security cameras are not eligible.
How does the Category 2 budget work?
Each applicant has a Category 2 budget calculated from a per-student or per-square-foot multiplier set by the FCC. The budget runs on a five-year cycle. An applicant can use the full five-year budget in one year or spread it across multiple years.
Once the five-year budget is exhausted, the applicant cannot receive additional Category 2 commitments until the next budget cycle resets.
Common questions
- What's the Category 2 budget per student?
- The FCC sets the per-student multiplier and floor amount, which are inflation-adjusted periodically. Check USAC's current Category 2 budget tool for the up-to-date numbers for your funding year.
- Is structured cabling Category 1 or Category 2?
- Structured cabling installed inside a school or library is Category 2 (Internal Connections). Cabling that connects the school to the service provider's network is Category 1.
- Are firewalls eligible under Category 2?
- Yes — firewalls are eligible Internal Connections under Category 2 in current funding years, including basic firewall functionality. Advanced or non-eligible features must be cost-allocated.
Track this in real product data.
ERateSignal turns the public USAC datasets behind Category 2 into a working tool for E-Rate sellers — Form 470 alerts, SPIN market share, and territory analytics on the apex domain.
This entry summarizes publicly available FCC and USAC guidance for educational purposes and is not legal or procurement advice. Verify all information directly with USAC or qualified counsel before making business decisions. ERateSignal is not affiliated with, endorsed by, or sponsored by USAC, the FCC, or the U.S. Government.