Schulte, from Fishers, Ind., was at 8-under 136 through 36 holes.
'Off the tee I struggled a little bit today,' he said. 'Yesterday's round felt easy ... Today was more work. I actually made quite a few (putts) that were of significant length, maybe 5-, 6-footers for par sometimes. I was just pleased to get them in.'
Defending champion Mike Small and two others were a shot off the lead.
Small stayed close with the help of back-to-back birdies on 17 and 18. Small made the 17th hole -- one of the longest par-4's on the Atunyote Golf Club course -- look easy with a tap-in putt for birdie. He finished with a 68.
'I hit a long drive, had only 130 yards to the hole and hit a perfect wedge,' Small said. 'It hit and spun to the left like I thought it would, just like I drew it up.'
Small, golf coach at the University of Illinois, didn't do as well on the front nine.
'I birdied the first hole, bogeyed the easiest hole No. 5 and then struggled the whole rest of the front nine.' Small said.
Don Berry, of Rogers, Minn., and Steve Schneiter, of Sandy, Utah, are tied with Small.
Schulte notched three birdies in his round while Schneiter finished with a 70 after birdies on Nos. 5 and 6 followed by a double-bogey on the seventh holes.
'I played solid all day except for on No. 7, where I unfortunately had a bad break,' Schneiter said. 'I pulled the ball to the left of the green and buried it in the lip of the bunker. It took me two strokes to get out of the bunker. I then missed my 10-foot bogey putt.'
Berry trailed the leaders by three shots after an opening round of 70 on the Atunyote course. He picked up five strokes with the days' best score of 67, which included seven birdies.
'I played really well the past two days and had been struggling recently until I got to this tournament,' Berry said.
John Troub, of Rochester Hills, Minn., made a hole-in-one on the 183 yard ninth hole on the Shenendoah course, hitting a 7-iron.
The field of 312 golfers was whittled down to the top 70 plus ties for the final two rounds that will be held on the Atunyote course Saturday and Sunday.
Former winners of the event including Bob Sowards (2004); Mike Burke Jr., (1998); J.R. Roth (1993); Bruce Zabriski (1997) and 2002 runner-up Mike Gilmore all missed the cut.