Former FCC Commissioners and Lawmakers Defend USF in SCOTUS Briefs

Other recently filed briefs similarly defended the FCC and its oversight of the program, with no support so far for Consumers' Research’s position that the USF contribution factor is a violation of the Constitution.

“While Amici have differing views on many regulatory issues, they share the view that the decision … misunderstands the FCC’s role in discharging its statutory responsibilities to advance universal service,” the former commissioners' brief said. Contrary to the 5th Circuit’s characterization, "the FCC does not merely ‘rubber stamp’” Universal Service Administrative Co. decisions. “The FCC” not USAC, “sets the ‘contribution factor.’” Democratic and Republican appointees signed the brief: former Chairmen Richard Wiley, Reed Hundt, Julius Genachowski and Tom Wheeler, former acting Chairwoman Mignon Clyburn and former Commissioners Kathleen Abernathy, Jonathan Adelstein and Rachelle Chong.

The brief explains for SCOTUS how the contribution factor is developed. The FCC “creates the forms that the Administrator uses to collect its data” and “thereby sets the stage for the types of data the Administrator will receive and defines which categories of service provider must contribute to the Fund.” The FCC then “independently establishes the contribution factor after reviewing the Administrator’s demand and expense projections, as well as its calculations of total assessable revenues.”

The agency sometimes adjusts the numbers: The commission also “acts as an appellate administrative tribunal that reviews … and, in appropriate instances, reverses decisions by the Administrator.” The 5th Circuit “conflated the public-notice period, during which the Commission solicits public comments on the contribution factor that it proposes, with the process by which the Commission determines the contribution factor.”

Lawmakers said in their brief, “Congress established high-level universal service policy and provided guiding principles to direct the Commission’s implementation. These guardrails not only ensure that the Commission stays within its delegated mandate, but they also allow the Commission to address ongoing changes in telecommunications needs through mechanisms that are most likely to further universal service.”

The 5th Circuit “erred in concluding that [USF's] implementation is devoid of political accountability. Congress has exercised, and continues to exercise, significant oversight of the Commission’s implementation of this program through legislative amendments, reporting requirements, and recurring committee hearings,” Fischer, Lujan and the other lawmakers said. “To say [USF's] implementation lacks continued direction from Congress is simply untrue -- indeed, many of the amici themselves have played an active role overseeing and further directing this program’s implementation.” The lawmakers also believe the 5th Circuit’s “wholesale dismantling of [USF] would have disastrous consequences for millions of Americans that have come to rely on this assistance.”

History Lesson

Professors Julian Mortenson and Nicholas Bagley of the University of Michigan Law School offered the court a history lesson, explaining that the nation's founders accepted delegation of authority. “Prevailing legal and political tenets posed no barrier to delegation, and legislatures across the Anglo-American world had long delegated broad rulemaking power to the executive, ministers, and other agents,” they said.

The Constitution’s vesting of legislative authority in Congress “was not meant to prevent Congress from delegating,” the law professors said: “Nothing in the constitutional text or structure requires such a limit, so long as Congress retains ultimate control over the legislative process.” In “statute after statute, the First Congress enacted sweeping delegations of policymaking authority over the most crucial issues facing the young nation, among them trade restrictions, patent rights, property taxation, refinancing the national debt, regulating the federal territories, embargoes, quarantines, search-and-seizure authority, pensions, raising armies, and calling up the militia.”

The Software & Information Industry Association told SCOTUS the E-rate program is critical in closing the digital divide. The loss of it “won’t just create staggering sunk costs; it will also dramatically exacerbate the ‘digital divide’ that Congress sought to close in the Telecommunications Act,” SIIA said. As E-rate “has evolved and expanded, schools and other recipients have come to rely upon the certainty of the funding it provides,” SIIA said: The program has led companies “to make long-term investments in providing high-quality and effective educational and other software.”

The Local Government Legal Center, the National Association of Counties, the National League of Cities and other International Municipal Lawyers Association also filed in support of the FCC. “The USF programs at issue in this case are vital to local governments,” they said: “Those programs have improved the quality of local education, healthcare and economic opportunities for local residents and promoted the growth of local businesses and economies.”