Texas K-8 Charter Network Triples Category 2 Budget

The Situation

A K-8 public charter network operating six campuses across two metropolitan areas in Texas had a chronic Category 2 problem: every year their five-year C2 budget came in well below what comparable district peers received per student. The network’s technology director knew something was wrong but could not pinpoint the cause — their per-student C2 enrollment numbers looked correct on the surface, and they had been working from the same EPC profiles since the network’s second campus opened.

By the third year of the C2 cycle, the network had only used $148K of available C2 funding across all six campuses combined. Comparable charter networks in the state were spending two and three times that. The network engaged erateapp to figure out what was breaking.

What erateapp Found

The problem was structural, not procedural:

• Three of the six campuses had been entered into EPC as annexes of the flagship campus rather than as standalone schools, which collapsed their student counts into a single shared budget.
• Two campuses had shared-use rooms (community-meeting spaces, evening adult-ed classrooms) that had been classified as non-instructional space, removing those square feet from the Category 2 cost calculation.
• The network’s pre-K classrooms (eligible for C2 budget when serving the same student population during instructional hours) had been excluded from enrollment counts entirely.

What erateapp Did

Step 1 — Entity restructure in EPC (Weeks 1-3)

We worked with the network’s authorizer documents and state charter records to establish that each campus operates under its own school identifier. We then submitted entity update requests in EPC to convert the three annex-classified campuses to standalone schools, attaching the supporting authorizer documentation USAC requires.

Step 2 — Reclassified shared-use space (Week 4)

For the two campuses with shared-use rooms, we documented the percentage of weekly use dedicated to instructional activities (averaging 78% across the rooms in question) and updated the C2 cost-allocation worksheets so that instructional-share square footage was correctly counted.

Step 3 — Updated enrollment records (Week 5)

Pre-K enrollment was added to the C2 student count for the three campuses where pre-K classrooms operate during the regular instructional day under the same program. We documented the schedule in a one-page memo USAC reviewers could verify against the campus master schedule.

Step 4 — Filed FY26 Form 471 against new budget (Weeks 6-10)

With restructured entity profiles in place, we filed FY26 Form 471 with C2 line items totaling $164K for the funding year — previously not possible against the old budget envelope.

The Numbers

Why It Worked

1. The students were always there. We did not invent enrollment — we corrected the EPC data so the program counted the students the network already serves.
2. Authorizer documents are dispositive. Charter networks live or die on their charter authorizer paperwork. USAC accepts authorizer documents as proof of separate-school status.
3. Cost-allocation works in the network’s favor when documented. Shared-use rooms are not disqualified — they are allocated. A one-page schedule memo is usually enough.

If This Sounds Like You

If your charter network is consistently underspending its Category 2 envelope, the issue is almost always in the entity profile or enrollment count. erateapp can run a free audit by BEN and tell you within 24 hours whether your C2 budget is correctly sized.

Related reading:

• Category 2 Wi-Fi Funding Guide
• E-Rate for Charter Schools
• E-Rate Eligible Services List 2026