Muni Broadband Preemption is Illegal, Counter-Productive

 

Overshadowed by the unveiling of net neutrality rules yesterday, the FCC also released its Order on municipal broadband petitions filed by utilities in Chattanooga, Tennessee and Wilson, North Carolina. The Commission had voted on February 26th to preempt state laws in TN and NC that restrict the expansion of government-run broadband networks.

“This is just another empty political stunt,” said Berin Szoka, President of TechFreedom. “For months, the FCC has claimed that states are prohibiting muni broadband. In fact, they’re merely imposing safeguards to protect taxpayers from having to subsidize networks outside their municipality, to ensure a level playing field between government-run and private providers, and so on. The FCC’s contorted jurisdictional theory won’t allow it to strike down absolute bans, only these generally sensible safeguards. So, perversely, the FCC may actually encourage states to ban muni broadband outright — which would be an ironically self-fulfilling prophecy.”

“This is a polarizing distraction from the real issue: clearing barriers to broadband deployment and building fiber-ready infrastructure, primarily at the local level,” continued Szoka. “If cities want faster broadband and more competition, they should start by cutting fees and red tape. Every time a street is dug up, a ‘Dig Once’ conduit should be installed underneath and leased to private providers. Such policies could greatly speed up broadband upgrades and entry by new providers like Google Fiber. Ultimately, these pro-deployment reforms must be implemented by Congress, state legislators and municipalities. Federal preemption legislation to set consistent standards may well be appropriate, just as it was when Congress clearly ordered the FCC to ensure that local zoning laws didn’t hamstring home installation of satellite TV dishes. But by starting yet another partisan fight about the FCC’s overreach, Tom Wheeler is poisoning the waters for real pro-deployment reforms.”

“The FCC is trying to sidestep its 2004 loss at the Supreme Court on this issue,” explained Szoka, citing Nixon v. Missouri Municipal League, in which the Court struck down the FCC’s preemption of an outright state ban on muni broadband because, while Section 253 of the Communications Act specifically authorized FCC preemption, it failed to make “unmistakably clear” whether that applied to state laws governing muni broadband.

“The FCC knows it’s on far weaker legal ground today,” concluded Szoka. “Section 706 doesn’t mention preemption at all; indeed, only by claiming that Section 706 is inherently ambiguous can the FCC argue with any plausibility that Section 706 confers any authority at all. Of course, Section 706 can’t be both ambiguous and unmistakably clear, so the FCC is trying to change the legal standard, claiming the Communications Act gives it sweeping preemption powers over any state laws governing telecom services short of outright bans. This flies in the face of other Supreme Court decisions recognizing states’ ‘absolute discretion’ to limit the powers of their municipal corporations. And even before a court reaches these federalism questions, it may reject the FCC’s absurd claim that Section 706 gives the agency carte blanche to do whatever it asserts will somehow promote broadband.”

Szoka can be reached for comment at media@techfreedom.org, and and see our other work on Section 706 and promoting broadband deployment, including:

  • “We Need More Google Fibers, Not Government-Run Internet,” a statement on President Obama’s white paper on “Community-Based Broadband Solutions”
  • “The FCC’s Section 706 Power Grab is Dangerous, and Ignores Marketplace Realities,” a summary of our comments on the FCC’s annual report on broadband deployment
  • “The Feds Lost on Net Neutrality, But Won Control of the Internet,” Berin Szoka and Geoffrey Manne in Wired.com
  • “Don’t Blame Big Cable. It’s Local Governments That Choke Broadband Competition,” Berin Szoka and Jon Henke in Wired.com
  • “Net Neutrality Regulation is Bad for Consumers and Probably Illegal,” a summary of TechFreedom’s legal comments to the FCC on Net Neutrality
  • A Third Way on Muni Broadband, TechFreedom & ICLE statement, summarizing comments opposing petitions asking the FCC to preempt state laws governing muni broadband

</>