Senate GOP Report Slams FCC for Process Failings in Net Neutrality Rulemaking

Majority staff of the Senate Homeland Security Committee under the guidance of Chairman Ron Johnson, R-Wis., conducted the investigation starting in February last year, weeks before the FCC approved 3-2 the net neutrality order. Johnson told us last June of his conclusion that Wheeler exhibited “no independence” from the White House and complained of the FCC’s “bare minimum” responses, with requests begetting more requests (see 1506080038).

The report’s goal was “to really take a look at how the administration overrode an independent agency’s rulemaking process here,” Johnson told us Tuesday. “We’re just putting out the results of our investigation. Didn’t get a whole lot of cooperation, by the way. Across the board, any of investigations, this administration is not the transparent administration they promised the American people they’d be. It’s like pulling teeth. It’s unfortunate.”

Johnson is also a member of the Commerce Committee, where FCC Chairman Tom Wheeler and fellow commissioners will testify at 10 a.m. Wednesday in 253 Russell. Johnson confirmed he plans to directly confront Wheeler about the report at the Wednesday hearing. “There’s the next step right there,” he said in an interview.

“I do not agree with the notion that it’s somehow improper for the President or his administration to express an opinion on the promulgation of federal regulations at the FCC,” Homeland Security Committee ranking member Tom Carper, D-Del., told us in a statement. “In fact, it’s been the standard practice across Republican and Democratic administrations to do so.” Carper's staff weren't involved in drafting the report.

Wheeler strongly rejected the charge nearly a year ago when several Capitol Hill committees summoned him to testify about net neutrality. He was always considering the use of Title II in justifying the order, he said. Critics point to various reports suggesting Wheeler was planning a “hybrid” approach involving Title II and Telecom Act Section 706, different from what was ultimately used in in the reclassification order. House Oversight Committee Chairman Jason Chaffetz, R-Utah, kicked off an investigation around the same time as Johnson and summoned Wheeler for a contentious hearing on the topic last March.

“It’s no secret that four million Americans, including the President, urged the FCC to protect a free and open Internet,” an FCC spokeswoman emailed Tuesday about the report. “The FCC ran a transparent and robust rulemaking process, which resulted in strong rules to ensure the Internet remains a platform for innovation, expression and economic growth.”

Republican commissioners disagreed. The report “paints a devastating portrait” of what led to the order, said Commissioner Ajit Pai, who voted against the order at the agency’s Feb. 26, 2015, meeting and long slammed the order as the product of Obama. Pai said the report “confirms that the President’s November 10 announcement of his own plan to regulate the Internet threw off this carefully orchestrated timetable” and laid out the play-by-play shown in the documents. “The searing light shone by the Committee’s careful, meticulous report wipes away the flimsy defenses that net neutrality activists offered last year,” Pai said. “Whether you support or oppose Internet regulation, this has been a sad chapter in the history of the FCC.” The report “crystallizes what most people knew in their hearts: the facts and process were thrown overboard in order to capitulate to the improper influence of the Administration,” said Commissioner Mike O’Rielly, who also voted against the order and now called it “a discredit to the agency’s independence and the rule of law."

Document analysis "shows that the FCC bent to the political pressure of the White House, abandoning its work on a hybrid approach to ‘pause’ and then pivot to reclassify broadband as a telecommunications service, subjecting broadband providers to regulation under Title II,” the 30-page Johnson report said. “The FCC’s staff worried that the process to adopt President Obama’s preferred policy approach violated the Administrative Procedure Act. Most fundamentally, throughout this process -- as the FCC shifted to a Title II approach and then responded to congressional oversight -- it failed to live up to standards of transparency.” The report frequently distinguishes between what it calls nonpartisan and career FCC staffers who worked on the order and those working more directly for Wheeler. Majority staff said “career professional staff at the FCC worked diligently on the Commission’s OI [open Internet] Order, despite its significant and last-minute change in direction,” the report said. “It is also clear that career professional staff worked expeditiously and thoroughly on the Commission’s planned Public Notice, despite its ultimate abandonment by FCC leadership. Had the White House not inserted itself into the formal FCC rulemaking process, it is probable that the Open Meeting in December would have included the OI Order. At the very least, if the FCC had issued a Public Notice, the record would presumably have been much more informed.”

The committee directly exhibited many of the email messages showcasing the pause following Obama’s intervention, the internal FCC debate on whether to do a public notice and how to defend the order’s development to press and others. Committee staffers also chronicled Wheeler’s many meetings with the White House from before November 2014 and cited the lack of ex parte filings. Those documents are in appendices A, B and C.

Johnson staffers accused the FCC of withholding documents despite what they called repeated requests for them. “Several documents produced to the Committee reference the existence of drafts of the Open Internet proposal prior to the President’[s] statement in support of Title II,” the report said, referring to a Nov. 5 email to FCC General Counsel Jon Sallet. “Although this e-mail included an attachment with the draft proposal, the attachment was withheld from the Committee when the FCC produced documents.” The FCC provided the committee with parts of its public notice draft but not the draft in total, the report said.

"The report gives fuel to the arguments that the FCC abused its discretion when issuing the Open Internet Order​ in part by not giving proper notice of its ultimate Title II regime and providing an adequate opportunity for public comment,” said former Commissioner Robert McDowell, now with Wiley Rein and an opponent of the net neutrality order. “Based on the report's analysis, it appears that the majority chose not to issue a further notice, over career staff objections, but instead solicited new arguments from allied advocacy groups regarding at least the wireless and interconnection pieces without soliciting public comment. In cases like this, a court could take judicial notice of such a report and factor it into its deliberations over alleged defects in its adherence to the APA.”

“This report shows that the FCC clearly understood the ‘serious’ procedural infirmities in its open Internet proceeding, particularly with respect to mobile broadband,” said CTIA Vice President-Government Affairs Jot Carpenter, calling for a “long-term solution” from the Hill.