FCC Reform

The House Appropriations Committee June 28 released a draft measure that would cut the Federal Communications Commission’s budget to the level sought by the White House. The committee proposed in its draft fiscal 2018 Financial Services and General Government Appropriations bill to make $322 million available to the FCC for fiscal 2018. That’s the funding level President Donald Trump requested in May, down 5.2 percent from fiscal 2017. Under the stripped-down budget, the FCC envisions cutting over 100 agency jobs.

FCC Chairman Ajit Pai said in a June 20 Senate Appropriations subcommittee hearing that the cuts will drive greater efficiency and reduce regulatory costs for the industries the agency oversees. The FCC raises the money for its congressionally set budget by collecting fees. Democratic Commissioner Mignon Clyburn said in the hearing that the staffing and resource cuts could compromise the FCC’s “core mission of protecting consumers, advancing competition, and ensuring the reliability and resiliency of public safety communications.”

Federal Communications Chairman Ajit Pai told members of the Senate that the Commission is moving ahead with cost-cutting initiatives that are already on track to save $1.1 million annually. But while Chairman Pai touted efforts to slash costs, Commissioner Mignon Clyburn said the FCC is operating with a skeleton crew of employees, noting staffing levels are at their lowest point in 30 years.

While efficiencies have been created in some departments, the reduced staffing has forced other employees to double their workloads, often with little or no change in compensation, she said. Commissioner Clyburn noted a recent Federal Employee Viewpoint Survey showed nearly 40 percent of FCC employees feel they don’t have enough resources to get their jobs done. Further budget cuts will exacerbate this crunch, she said, which will be a big problem in terms of allowing the FCC to carry out its function.

[Commentary] In order for us to expand prosperity and extend economic opportunity to more Americans, we must remain on the cutting edge. This means that government at all levels must focus on removing barriers to innovation and ensuring that technological advances aren’t strangled by bureaucratic red tape.

For starters, we’re taking aggressive action to speed the roll-out of next-generation wireless networks. But to get to the 5G future that will make the Internet of Things fully possible, we’ll need much more infrastructure than what today’s networks demand. If America is to lead the world in 5G, we need to modernize our regulations so that infrastructure can be deployed promptly and at scale. Another Federal Communications Commission priority has been making the agency more agile and responsive.

Federal Communications Commission Chairman Ajit Pai said the commission can do more with less—102 fewer full-time employees, for example—and his budget reflected that philosophy while still being able to serve the FCC's core mission of protecting the public interest and closing the digital divide. Chairman Pai, joined by Commissioners Mignon Clyburn and Michael O'Rielly, testified on the FCC's budget before the Senate Appropriations Committee's Subcommittee on Financial Services and General Government.

The FCC has asked for about $322 million, 5.2% less than the previous year, even though the FCC's budget has been flat since 2009. Chairman Pai conceded it was a challenge to do more with less but that the FCC had rolled up its sleeves. And while he said past chairmen had pointed out that the FCC is fully funded by fees charged to licensees, he also remembered—and more than one legislator reminded him—that someone was paying that fee, including businesses big and small and the consumers to whom those fees were passed along. Chairman Pai said that even with fewer people, the FCC had more than doubled the number of items it was dealing with at its public meetings—saying the average was not 5.83 items vs. 2.58 under his predecessor. He cited a number of cost savings as well, from closing an off-site warehouse to cutting down on the number of printers and copying machines.

[Commentary] After decades of failed efforts to enact “regulatory reform” bills, Congress appears to be within a few votes of approving reform legislation that would strip Americans of important legal protections, induce regulatory sclerosis and subject agencies that enforce the nation’s laws and regulations to potentially endless litigation. This is not reform.

These bills would sabotage agency regulation with legislative monkey wrenches. Key compromises about agency power and procedures, worked out under the 1946 Administrative Procedure Act, would be discarded by these overwhelmingly anti-regulatory bills. And because they would be statutory changes, not mere presidential edicts, these changes would likely long outlive the Trump administration. Independent agencies like the Federal Communications Commission, the Securities and Exchange Commission and the Consumer Product Safety Commission, long protected from direct presidential control, would now be subject to this bill’s requirements and oversight by the information and regulatory affairs office.

[Buzbee is a professor at Georgetown University Law Center and a founding member-scholar of the Center for Progressive Reform]

Federal Communications Commission Chairman Ajit Pai announced that the following items are tentatively on the agenda for the June Open Commission Meeting scheduled for Thursday, June 22, 2017:

New Emergency Alert System Event Code For Blue Alerts – The Commission will consider a Notice of Proposed Rulemaking that would amend the Commission’s Emergency Alert System (EAS) rules to add a dedicated event code, “BLU,” for Blue Alerts, so that EAS alerts can deliver actionable information to the public when a law enforcement officer is killed, seriously injured, missing in connection with his or her official duties, or if there is an imminent and credible threat to a law enforcement officer. (PS Docket No. 15-94)

First Responder Network Authority – The Commission will consider a Report and Order that establishes the procedures and standards the Commission will use to review alternative plans submitted by states seeking to "opt-out" of the FirstNet network and to build their own Radio
Access Networks that are interoperable with FirstNet. (PS Docket No. 16-269)

Exemption to Calling Number Identification Service – The Commission will consider a Notice of Proposed Rulemaking that would amend the Caller ID rules to allow disclosure of blocked Caller ID information to aid law enforcement in investigating threatening calls and continue the
waiver of those rules that is currently in effect for Jewish Community Centers. (CG Docket No. 91-281)

OneWeb Market Access Request – The Commission will consider an Order and Declaratory Ruling that recommends granting OneWeb’s request to be permitted to access the U.S. market using its proposed global non-geostationary satellite constellation for the provision of broadband communications services in the United States. (IBFS SAT-LOI-20160428-0041)

Improving Competitive Broadband Access to Multiple Tenant Environments – The Commission will consider a Notice of Inquiry that seeks comment on ways to facilitate greater consumer choice and enhance broadband deployment in multiple tenant environments such as
apartment buildings, condominium buildings, shopping malls, or cooperatives. The Notice of Inquiry further seeks comment on the current state of broadband competition in such locations and whether additional Commission action in this area is warranted to eliminate or reduce barriers faced by broadband providers that seek to serve the occupants of multiple tenant environments. (GN Docket No. 17-142)

Electronic Annual Notice Declaratory Ruling – The Commission will consider a Declaratory Ruling which would clarify that the “written information” that cable operators must provide to their subscribers via annual notices pursuant to Section 76.1602(b) of the Commission’s rules may be provided via e-mail. (MB Docket No. 16-126)

Modernization of Payphone Compensation Rules – The Commission will consider a Notice of Proposed Rulemaking and Order that (1) proposes to eliminate the requirement that carriers that complete payphone calls conduct an annual audit of their payphone call tracking systems and file an associated annual audit report with the Commission, and (2) waives the annual audit and associated reporting requirement for 2017. (WC Docket Nos. 17- 141 and 16-132; CC Docket No. 96-128).

Enforcement Bureau Action - The Commission will consider an enforcement action.

[Commentary] One less-publicized initiative of new Federal Communications Commission Chairman Ajit Pai may have profound impact on the agency’s policymaking agenda. Chairman Pai announced that he would be creating an Office of Economics and Data (OED) at the FCC. This office will combine economists and other commission staff to provide better input on rulemaking proceedings and transaction reviews, along with enhanced support for data management and research activities.

If implementation matches aspiration, OED may fill in a critical role for economic analysis that has been minimized in recent years. The FCC employs a general counsel and a large legal staff, but its chief economist is appointed from the ranks of academia to a one- or two-year term on a rotating basis. These individuals have served in this capacity with distinction, so the problem is not one of analytic talent. Rather, the chief economist’s short stint, combined with not reporting directly to the chairman, has minimized the impact of economic analysis in the decisionmaking process.