Net Neutrality Is Just the Tip of the Preemption Iceberg

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On Thursday, December 14, the Federal Communications Commission (FCC) voted 3-2 to overturn the current network neutrality framework in its Restoring Internet Freedom order. The final order, which returns internet service to a “Title I” service under the Telecommunications Act, will no longer require that internet service providers treat all web traffic equally and will allow ISPs to engage in blocking, throttling, and paid prioritization, provided they disclose those activities to consumers.

The final order also contained a provision to preempt “utility style” state and local regulation of internet service providers, along with language indicating the FCC’s intent to more broadly preempt state and local authority as necessary to uphold the order’s intent.

This move is the latest in a series by the FCC to limit the power of state and local governments to control broadband infrastructure and service within their jurisdictions. The majority of commissioners indicated during their remarks at the meeting that their long-term intent was to promote the US wireless industry through rollbacks in federal regulation, and preemption of state and local regulation.

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“Broadband service is not confined to state boundaries and should not be constrained by a patchwork of state and local regulations,” said Commissioner Michael O’Rielly during the meeting, “and this is particularly germane to wireless services where mobile devices and the transmissions they carry can easily cross state lines.”

“A hodgepodge of state rules could severely curtail not only the next generation of wireless systems that we have been working so hard to promote,” O’Rielly added, “but also the technologies that may rely on these networks in the future. Accordingly, any laws or regulations that conflict with or undermine federal broadband polices are preempted. Given my druthers, I would actually go even further on preemption, but I could only carry the debate so far today.”

Commissioner O’Rielly’s words and similar statements by his colleagues should give cities pause when considered in combination with other efforts this year by the FCC to curtail local authority or drive a narrative that local governments are the primary obstacle to ubiquitous broadband availability and adoption in the US. The preemption provision in this week’s net neutrality order is the tip of a much larger preemption iceberg looming in the future.

Preliminary rulemaking activities undertaken by the FCC’s Wireline Competition Bureau and Wireless Telecommunications Bureau this year indicated an interest by the agency in creating a competitive advantage for wireless providers. The preemptive ideas proposed by the FCC would limit local governments’ ability to ensure equitable broadband infrastructure deployment in their communities and hamper local digital equity efforts to prevent redlining of broadband infrastructure.

The proposals included possible reforms to utility pole attachment fees, tighter restrictions on the time city governments have to review wireless facilities siting requests, particularly for “small cell” infrastructure, limits on what things cities may consider when deciding whether to approve or deny a site application, restrictions on what cities may negotiate in their agreements with providers, and even what they may charge for access to public property like the rights of way.

FCC Chairman Ajit Pai this year also formed a new Broadband Deployment Advisory Committee. While the group was broadly described as working provide the FCC with guidance on how to expand broadband infrastructure deployment, it has focused solely on what it perceives as the main obstacle to broadband — state and local government action, and to a lesser extent, federal regulations — and not at all on what constructive federal policy or actions by industry could be taken to expand access and adoption across communities and income levels.

While NLC has fought hard for local governments to have a place on this advisory committee, local government officials are still outnumbered ten to one by industry and other interests.

Additionally, more than half of state legislatures or regulatory boards have taken action to preempt local control over “small cell” wireless facilities in the last few years, under the reasoning that compliance with local regulations and market-rate payment for use of public property is overly burdensome for wireless providers, and is quashing broadband development and investment.

These preemptions have harshly limited local review processes, set strict caps on rents for use of public property, and effectively forced municipalities to subsidize wireless development for the sake of “streamlining” permitting processes ahead of the deployment of 5G wireless technologies.

Nearly half of states have also placed roadblocks in front of the establishment of municipal broadband networks by cities or public utilities. Colorado, which requires local governments to hold ballot initiatives for residents’ approval before investing in building fully or partially public networks, has seen intense lobbying in local elections by ISPs to prevent these investments.

Most recently, Colorado ISPs spent nearly a million dollars on an unsuccessful campaign to prevent the City of Fort Collins from establishing a broadband utility. Combined with the overturn of net neutrality’s common carrier requirements, cities have ever-fewer options for ensuring that their residents have affordable access to reliable, unrestricted broadband.

NLC has pushed back on these preemption attempts, including the overturn of net neutrality, the Broadband Deployment Advisory Committee’s unfair premise, and regulatory proposals to change the way infrastructure is governed by localities. While the net neutrality order will be fought in the courts by state attorneys general and others, cities must focus on the larger preemption threat within the federal government.

Broadband infrastructure will be vital for the future of transportation, healthcare, education, and the American economy as a whole. Cities must fight to protect the ability to determine their own broadband destinies and those of their residents, rather than having them determined by the business decisions of an increasingly consolidated ISP market.

About the Author: Angelina Panettieri is the Principal Associate for Technology and Communication at the National League of Cities. Follower her on twitter at @AngelinainDC.