Pai Renomination Looms Over Wednesday Senate Commerce FCC Oversight Hearing

Wednesday’s Senate Commerce Committee hearing comes as a referendum on the new chairmanship of FCC Chairman Ajit Pai, who received his nomination from the White House Tuesday for another five-year term at the agency following his term’s July 1, 2016, expiration. Pai met with President Donald Trump Monday (see 1703060055), and all eyes are on the administration for any information about forthcoming FCC nominations for the two open commissioner spots, one typically for a Republican and one for a Democrat.

Pai is "deeply honored," he said in a statement. "If I am fortunate to be confirmed by the Senate, I will continue to work with my colleagues to connect all Americans with digital opportunity, foster innovation, protect consumers, promote public safety, and make the FCC more open and transparent to the American people."

Senate Democrats plan to raise the issue of nominations generally and will talk about Jessica Rosenworcel, the former Democratic commissioner forced to leave the commission in January. Democrats said they want Trump’s White House to renominate her. Senate Minority Leader Chuck Schumer, D-N.Y., has pressed for the administration to defer to Senate Democrats on the open Democratic commissioner spot (see 1703020067).

“I’m waiting for Commissioner Rosenworcel’s renomination and my disposition regarding all FCC commissioners will depend on what happens with Jessica,” said Senate Communications Subcommittee ranking member Brian Schatz, D-Hawaii, in an interview Tuesday. “I think she should be renominated, and until she’s renominated I think it’s going to be very difficult to get any bipartisan cooperation.” He cited an earlier agreement to confirm Rosenworcel in exchange for Senate approval of Commissioner Mike O’Rielly, a Republican. That leadership deal “still ought to stick,” Schatz said. “She is the right person on the Democratic side to serve on the commission. I think it’s critical that she gets renominated.”

Commerce Committee ranking member Bill Nelson, D-Fla., plans to address both Pai’s renomination and Rosenworcel at Wednesday’s hearing, a spokesman said.

Commerce Committee Chairman John Thune, R-S.D., is “not anticipating” any other FCC nominations from the White House before the hearing but didn’t know for sure, he told reporters. White House spokespeople declined to say whether more nominations were coming this week.

Pai, in his five-page written testimony, doesn’t use the words net neutrality, ISP privacy or Lifeline, all touchstones for Democratic criticism in the first months of his chairmanship. Instead he plans to talk about four broad topics: closing the digital divide; promoting innovation; protecting consumer and public safety; and reforming the FCC’s processes. This is Pai’s first hearing before Congress as chairman and he will testify alongside O’Rielly and Mignon Clyburn. He likely will face the same panel for a reconfirmation hearing and will require the committee and full Senate to clear him if he's to sit on the commission beyond 2017. Industry stakeholders including the American Cable Association, AT&T, CTIA, NCTA, NAB and USTelecom lauded the Pai renomination Tuesday.

“What we have accomplished so far is a tremendous credit to the nonpartisan, federal employees of the agency -- our hard-working professional staff, who are the agency’s strongest assets,” Pai plans to say Wednesday, stressing cooperation between Republicans and Democrats. “And it is a credit to you, our congressional overseers, as well as other elected officials like Senator Schumer, who have highlighted the many issues the FCC must tackle in a bipartisan manner. These past six weeks have only reaffirmed my view that no FCC office or floor holds a monopoly on wisdom.” He will discuss his actions on robocalls, broadband, contraband cellphones in prisons, 5 GHz and next-generation TV.

One controversial issue he will touch on is zero rating. The FCC “ended its investigation into the free-data offerings of wireless carriers,” Pai plans to say. “Innovative offerings like T-Mobile’s Binge On have been popular with consumers, particularly low-income Americans, and have enhanced competition in the marketplace. I firmly believe the Commission should favor permissionless innovation in this fiercely competitive market -- and rely on consumer choice to sort out what innovations best serve the public interest.”

Open internet and ISP privacy protections are expected to come up. Congressional Democrats slammed Pai for the 2-1 vote to stay some ISP privacy rules recently. Pai hasn't precisely laid out how he will address the FCC’s 2015 open internet order and its reclassification of broadband as a Communications Act Title II service.

“As I suspect everyone in this room knows, I feel pretty strongly that the best way to provide long-term protections for the internet is for Congress to pass bipartisan legislation,” Thune plans to say in his opening statement. “But since we don’t yet have agreement on that front, despite good will on both sides, there’s no reason for the FCC to hold off doing what is necessary to rebalance the FCC’s regulatory posture under current statutes. Something tells me much of today’s hearing will be dedicated to this topic.”

“We’re going to be talking about the underlying reality of net neutrality and the privacy rules and how that really inhibits innovation, which is what I think most Americans want,” Sen. Ron Johnson, R-Wis., said in an interview, citing a recent meeting with O’Rielly. “So I think it’ll be a good hearing to lay out those realities.” The six-page GOP memo for the hearing also mentions both net neutrality and ISP privacy as expected topics. Sen. Mike Lee, R-Utah, plans to probe commissioners on net neutrality, his spokesman said.

Clyburn continues to believe the FCC’s open internet order “provides the best legal framework to protect consumers, innovators and entrepreneurs,” she plans to testify, along with laying out concerns about the stay of privacy rules. “I was deeply disappointed by the Chairman’s decision to effectively gut one of those rules,” she will say. “The outcome of the decision is not relief from purported regulatory burdens. In fact, the providers who sought the stay of the privacy rules used the very text of the FCC’s rule as the basis for their voluntary code of conduct. The real effect here is a lack of recourse for consumers when their personal information is compromised.”

Consumers Union sent committee leaders a letter Tuesday urging attention to a consumer telecom agenda. "Unfortunately, one of Chairman Pai’s first anticipated actions at the FCC is to unravel" the ISP privacy rules, the group said. "There is no question that consumers favor the FCC’s current broadband privacy rules." Senators should ask Pai "where the facts he cited came from with regard to the historically low levels of broadband investment that he uses as a justification to scuttle the FCC’s net neutrality rules" and should "investigate his plans and thinking with regard to net neutrality," Consumers Union said.

“I’m going to encourage [Pai] to try to stay true to his word that he wants the commission to work in a bipartisan fashion,” Schatz told us. “It’s easy to say, but now he’s responsible for the commission as an institution. And so I want him to get to 5-0 as much as possible, but that means that the chairman is going to have to respect the views and the priorities of all commissioners.”

Sens. Ed Markey, D-Mass., and Richard Blumenthal, D-Conn., both members of Commerce, led a letter of their colleagues to Pai on E-rate. “Your actions threaten to roll back progress made in all of these states and disrupt schools and libraries’ carefully planned multi-year budgets,” they said in a letter dated Tuesday. “Accordingly, we call on you to guarantee that this treasured program will not be undermined in any way under your watch.” Sen. Cory Booker, D-N.J., another Commerce member, sent Pai a letter on his concerns with Pai's stance on inmate calling.