Federal Communications Commission: Live by 3-2 Vote . . .
There are familiar maxims in many sports, such as “Live by the 3-point shot, die by the 3-point shot” in basketball. The message being that high-risk tactics that bring temporary success often reverse and lead to ultimate defeat.
In recent years under Chairman Tom Wheeler, the FCC has decided many major decisions along bitterly divided 3-2 party line votes among the five Commissioners. The two Republican Commissioners have often accused the three Democratic Commissioners of ignoring the record before the FCC, ignoring past FCC precedent or the Communications Act, and refusing to consider other points of view or to reaching compromises across party lines. As a general rule, the Republican Commissioners preferred approaches and policies grounded in technology or competition, rather than additional regulation.
This recent history is very unusual for the FCC. In prior administrations, most telecommunications policy-making at the FCC has been largely non-partisan. Policy differences between Democratic and Republican Commissioners were usually more differences of emphasis or priorities rather than on fundamentals, with both parties generally supporting a significant amount of deregulation and changes to introduce and support new technologies and services.
Historically, there has been a high degree of comity among the FCC Commissioners across party lines most of the time. Typically, negotiations between and among Commissioners’ offices tried to eliminate or reduce as much as possible strong disagreements on decisions. There were exceptions of course, but they were exceptions not the normal course of business month in and month out.
The current FCC has operated very differently. At most of its monthly public meetings, major FCC decisions have been adopted by party-line 3-2 votes. The divisions have been marked by strong dissents that attack both the substance and process of the FCC decision-making. Moreover, there has been the same kind of unyielding disagreement between the majority Democratic Commissioners and the Republican Chairs of Congressional Committees and Subcommittees responsible for telecommunications in the House and Senate.
During calendar year 2015, these FCC decisions at public meetings are examples of the divided process:
January: 2015 Broadband Progress Report in which the FCC adopted 25 Mbps downstream and 3 Mbps upstream as the new benchmark for fixed broadband service.
February: Open Internet Order in which the FCC adopted a new regulatory framework for broadband and reclassified fixed and mobile broadband Internet Access Service as a telecommunications service, subject to Title II of the Communications Act. Though affirmed by the D.C. Circuit, a petition for rehearing en banc remains pending.
February: Declaratory Order pre-empting North Carolina and Tennessee laws limiting the service areas of municipal broadband providers to their municipal boundaries. The FCC decision was reversed on appeal.
June: Changes to the Lifeline Program.
July: Designated Entity Rules for Spectrum Auctions.
August: IP Technology Transition and Copper Loop Retirements.
August: Incentive Auction Bidding Procedures.
October: Inmate Calling Rates. The FCC was reversed on appeal but the matter is still pending.
This trend continued into 2016 as the FCC adopted its Broadband Consumer Privacy Rules. However, it appears that the current FCC leadership is now heeding the request of House and Senate Republicans to defer action on potentially controversial items, including several that had been placed on the agenda for the Commission’s November Open Meeting, one of which was special access service rate reform.
Because of the magnitude of the policy disagreements at the FCC between Democratic and Republican Commissioners, many FCC observers believe that a number of these recent decisions will be scaled-back or reversed once Republican Commissioners acquire a majority or as the Republican majorities in the House and Senate focus on telecommunications policy including a possible re-write of the Communications Act of 1934, as amended.
Soon after President-Elect Trump is sworn in, one of the two current Republican Commissioners will be named the Acting FCC Chairman. While this will not immediately change the majority-minority status of Democrats and Republicans at the FCC, it would be no surprise if then ex-Chairman Wheeler resigns rather than continue on as a Commissioner. Democratic Commissioner Rosenworcel’s term expires as the current Congress ends, unless the Senate confirms her reappointment to another term. These potential transitions in FCC leadership raise the possibility of a 2-1 Republican majority at the FCC until vacancies are filled.
Moreover, even if there is still a Democratic majority on the FCC, the Acting FCC Chairman will have authority to direct the agenda and the staff of the FCC. Some policies may change immediately under a Republican Acting Chairman, such as the very large forfeitures that have been imposed by the Enforcement Bureau during the past two years. The Republican Commissioners argued that many of these forfeiture decisions lacked a sound basis or objective, but were, in fact, unauthorized policy-setting by the staff.
The most important question is whether there is reasonable hope that a less partisan decision-making process will return after what may well be a second exceptional period of divided decision-making under a new Republican majority at the FCC. The obvious value of a consensus-driven approach is that the telecommunications industry and public could rely on FCC decisions having long-term viability and not being subject to reversal whenever a new President takes up residency at the White House.
The serious risk is that after potentially two significant periods of highly politicized decision-making at the FCC, highly partisan decision-making becomes the new normal. In that case, the telecommunications industry will find itself on a policy roller coaster ride for many years to come and that is unlikely to sustainably advance the interests of either the industry or the public.