U.S. elections, particularly in presidential election years, create the potential for significant shifts in federal policy, and the Federal Communications Commission is a good example.
These political shifts ripple through the FCC, where a newly-elected president from a different party gets to select a new FCC chair. If the Democrats win the presidency, or merely regain control of the Senate in 2020, it could have significant implications for the communications industry.
Net neutrality is one issue that will almost certainly be revisited if the Democrats regain the White House. In 2015, the FCC under Democratic Chairman Tom Wheeler enacted the open internet order, which classified the provision of internet service as telecommunications, giving the FCC broad authority to enforce on internet service providers (ISPs) net neutrality rules and other rules intended to protect consumers and promote social welfare and public safety goals.
ISPs challenged the order as overbroad and economically imprudent and secured the support of a majority of Republicans in Congress. After President Donald Trump appointed Ajit Pai as FCC Chairman in 2017, Pai made reversing the FCC’s position on net neutrality a top priority.
The FCC under Pai adopted the restoring internet freedom order in December 2017, which ordered the Wheeler-era rules removed within a year. Since taking control of the House of Representatives, Democrats have sounded the alarm against the Pai commission’s action, most recently passing the Save the Internet Act of 2019, which would undo the 2017 order.
Congressional Action Would Provide Stability
Were a Democrat to defeat Trump in November’s election, the replacement FCC chair would almost certainly look to reinstate the Wheeler commission’s net neutrality rules, swinging the pendulum back in the other direction. This amount of uncertainty is not good for consumers or their service providers. A better approach would be for Congress to craft a legislative net neutrality solution to provide more stability and predictability in the market.
Actions taken by the Republican Congress after the election of Trump in 2016 also raise the stakes associated with the looming election. After seizing control of both houses of Congress and the White House, Republicans took advantage of a seldom used mechanism of congressional oversight, the Congressional Review Act (CRA), to overturn 14 rules established during the waning days of the Obama administration.
The CRA provides Congress with a fast-track process to invalidate agency regulations and prevent enactment of a similar rule without an act of Congress. Under the CRA, Congress may disapprove of an agency rule by passing a joint resolution within 60 legislative days after the rule is submitted to Congress. The need for single party control of the executive and legislative branches limits the utility of the CRA, but when the conditions are right, as in 2017, it is a powerful tool.
The Wheeler FCC’s privacy rules for ISPs were among the regulations Republicans eliminated using the CRA. The FCC set privacy rules for ISPs pursuant to its authority over telecommunications common carriers under Section 222 of the Communications Act. Trump signed the CRA joint resolution eliminating those rules in April 2017.
A Democratic-controlled FCC might seek to re-establish a role for the FCC in ISP privacy regulation, especially if Congress does not enact a federal consumer privacy law covering ISPs, but this is another area where legislative action (and the stability it would afford consumers and ISPs) would provide a better path forward.
Negotiations over federal privacy legislation have advanced significantly in the past year as California’s privacy law moved closer to becoming effective, which it did on Jan. 1. Several bills recently introduced in the Senate and House offer a possible path to compromise, though private rights of action and preemption of state law remain sticking points.
If Americans elect a Democratic president, a comprehensive federal privacy law, rather than action by the FCC, offers the best chance to establish consistent privacy rules across industries.
Winning control of the White House and Congress would allow Democrats to use the CRA to eliminate election year FCC decisions with which they disagree, but because possible use of the CRA looms it is difficult to predict how aggressively the FCC will exercise its rulemaking authority in 2020 in the lead up to the election.
However, there are issues pending before the FCC that could be candidates for CRA review if the Democrats take control of the White House and Senate.
In May, the FCC adopted a notice of proposed rulemaking seeking comment on the establishment of a financial cap on the Universal Service Fund (USF). Proponents argue that it would help the FCC evaluate the four USF programs in a more holistic way, encourage meaningful financial controls, reduce the burden on ratepayers, and increase efficiency and transparency.
By contrast, Democrats argue that Americans who participate in USF programs need more (not less) support, a cap would pit deserving beneficiaries against each other, and the U.S. has not fulfilled its mandate to ensure that all Americans have access to internet services that are reasonably comparable in quality and cost.
If the FCC establishes a cap on USF funding as part of the current rulemaking, victorious Democrats might attempt to use the CRA to undo that cap.
Under Chairman Pai, the FCC adopted an order in September 2018 aimed at accelerating the deployment of wireless infrastructure for 5G. The order limits the fees that state and local governments can charge for processing cell site applications and managing deployments in local rights of way. The FCC recently opened a new proceeding to consider petitions aimed at clarifying the FCC’s 2018 order in a way that continues to limit the discretion of state and local governments.
Although the FCC’s actions in this area have been lauded by politicians on both sides of the aisle as necessary to spur 5G deployment, some Democrats have questioned the FCC’s efforts in this area, so this could be another issue on which some victorious Democrats might seek to revisit FCC rules via the CRA.
All is not fractious, however. Even in the shadow of a looming election, many issues addressed by the FCC are still bipartisan. Spectrum policy, for example, figures prominently on the FCC’s 2020 agenda. All five FCC commissioners enthusiastically support the FCC’s on-going work to repurpose significant amounts of spectrum for 5G and next generation wireless technology, though they may disagree on the details.
The FCC plans several actions in 2020 aimed at releasing more “mid-band” spectrum, including an auction of priority access licenses in the 3.5 GHz band, an auction of C Band spectrum repurposed from satellite use, efforts to make available spectrum in the 5.9 and 6 GHz bands for unlicensed use, and additional progress on the 2.5 GHz band. These initiatives will likely enjoy bi-partisan support.
Federal elections have consequences, especially at the FCC. If the Democrats win back the White House and Senate, the communications policy pendulum will likely swing back in favor of FCC ISP net neutrality and privacy rules unless Congress acts to remove market uncertainty by enacting legislation.
This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.
Ari Fitzgerald is a communications partner at Hogans Lovells based in Washington, D.C. He provides strategic, legal, and policy advice on a wide range of communications and spectrum policy issues to some of the world’s largest and most dynamic companies.