FCC Muni Broadband Preemption Cases Get More Filings
If the 6th U.S. Circuit Court of Appeals rules for the FCC in municipal broadband pre-emption cases Tennessee v. FCC and North Carolina v. FCC (Nos. 15-3291/15-3555), it will send a signal to other federal agencies that the courts will support them if they choose to pre-empt state law, said officials in interviews Wednesday after filing in support of the states. By rewriting North Carolina and Tennessee laws to expand municipal powers, the FCC infringes upon an inviolable aspect of state sovereignty, exceeds the agency’s statutory authority and contradicts controlling Supreme Court precedent, said Tennessee Friday. The issue at hand isn’t municipal broadband networks in general, it’s more broadly about a federal agency overstepping its authority and preempting the state, said supporting organizations.
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While the order applied only to Chattanooga, and to Wilson, North Carolina (see 1505150043), there are about 20 other states that have enacted similar restrictions on municipally owned broadband networks, and if the FCC decision to preempt North Carolina and Tennessee stands, those states’ restrictions would come under fire as well, said National Governors Association General Counsel David Parkhurst. NGA, along with the National Conference of State Legislatures (NCSL) and the Council of State Governments, filed an amicus brief in support of Tennessee Friday. Removing states from the decisionmaking process over municipal broadband networks could lead to failure of a start-up commercial muni broadband business and it has potential to fiscally damage an entire corporate government that provides an array of services, Parkhurst said.
NCSL is concerned that the federal government should be permitted to erase the rights for a state to be able to promulgate laws, said Jon Adame, NCSL director-communications, Financial Services and Interstate Commerce Committee. If the commission order is upheld, it's likely that states will no longer allow municipal broadband networks at all because it has been made clear that the FCC cannot pre-empt the states on that issue, Adame said. “We're afraid that states would no longer have any kind of municipal broadband networks, and that would just be a travesty."
The FCC order is unlawful, Tennessee said. It asked whether the federal government has the power to rewrite a state’s laws to redefine the geographical area within which its units of local government can provide services. Tennessee said redrawing territorial boundaries for local governments violates the state’s sovereignty and implies that Congress can authorize a unit of local government created by the state to exercise powers not vested in that unit by the state: “The order overlooks the foundational principles of our federalist system and undermines this aspect of state sovereignty.” The FCC is scheduled to file its response to Tennessee by Nov. 5. The agency declined to comment on Wednesday.
The FCC mischaracterized the North Carolina and Tennessee laws as being about communications policy rather than a “core state function in controlling political subdivisions,” Tennessee said. The order offers no support for this, other than the observation that the state laws don't limit the expenditures of a city, it said. Like other geographic limitations of state law, the restriction delineates the powers of a municipal subdivision within the context of state governance objectives, the filing said. In fact, in rewriting the law, “the order does much more than impose federal communications policy,” it said. “It abandons past precedent and ‘redefines the relationship between state and municipal governments’ by expanding ‘territorial jurisdiction of a local governmental unit.’”
The law in Tennessee says a municipal electric plant is authorized to provide Internet services, but only within its electric service area, said the state’s filing. It also said North Carolina allows municipalities to provide broadband services, subject to several conditions. The filing argued that the elected representatives in Tennessee authorized the creation of muni electric systems and empowered the municipal entities to provide broadband Internet services within the boundaries of their service areas. It said when the FCC pre-empted this system, it also infringed on state sovereignty. “The order is an affront to state sovereignty and it cannot stand,” the filing said. “A state’s ability to establish subordinate subdivisions and prescribe their authority is a hallmark of state sovereignty. Neither Congress nor the FCC can direct a state as to the structure or authority of the organs of the state government.”