Local Governments Consider Response to FCC Title II Repeal

Local governments opposed to the FCC rescinding Title II protection are weighing legal and other options to protect neutrality and local authority, local representatives said. Some see municipal broadband as an answer, though few can buy such service today. Local government “has long supported enforceable net neutrality protections,” said Best Best attorney Gerard Lederer. State-level Democrats also seek to counter the FCC action through a planned multistate lawsuit by attorneys general, some governors mulling ways to use their state’s buying power to require net neutrality, and a flurry of state legislation predicted for 2018 (see 1712150042, 1712140044 and 1712210034).

Local governments might be a party or amicus in litigation to overturn the FCC order and could support congressional repeal efforts, Lederer said. The local government attorney cited a Boston-led opposition letter sent before the vote and signed by nearly 70 mayors and elected county officials (see 1712130053). “When the final order is issued, many of those same mayors, their city attorneys and [chief information officers] will review the order and look to coordinate a response that is the most efficient way to protect their citizens in the short and long terms,” Lederer said. Boston is reviewing options and monitoring outside efforts, including litigation and legislation, said Boston Department of Innovation and Technology Broadband and Cable Director Mike Lynch.

Cities want to know who will protect consumers if states and local governments can't and the FTC may respond only to harm, said Angelina Panettieri, National League of Cities principal associate-technology and communications. Democratic state AGs strongly staked out consumer protection in the past year and have deeper resources to take on the FCC in court than cities, but that’s not to say cities won’t sue or join another lawsuit, Panettieri said. “I don’t think we can rule anything out.”

Cities are highly concerned about broad pre-emption language in the FCC order, especially after Commissioner Mike O’Rielly’s remarks at the commission meeting (see 1712150042), said Panettieri. “That will be used as a weapon against states and localities in the next year.” The order lays groundwork for the FCC to pre-empt states on many broadband issues, including in the agency’s pending infrastructure rulemakings, she said. “If we spend too much time focused on net neutrality and Title II, we will miss a lot of what is going on around 5G [and] small-cell deployment.”

The FCC is pre-empting “state and local laws that interfere with the federal deregulatory policy restored in this order, [but] we do not disturb or displace the states’ traditional role in generally policing such matters as fraud, taxation, and general commercial dealings, so long as the administration of such general state laws does not interfere with federal regulatory objectives,” the draft order said. The FCC didn’t comment Tuesday.

Panettieri would be surprised if many cities make local rules that fly in the face of the FCC pre-emption threat because legal challenges are expensive, she said. “City governments don’t have enough resources to begin with.” In California, the state legislature pre-empted nearly all local telecom authority, so there’s not much leeway for local action, said Tellus Venture Associates President Steve Blum, a telecom consultant for local governments.

Some see municipal broadband as a panacea for the FCC’s deregulatory action. In New Jersey, Newark Mayor Ras Baraka last week pledged that his city’s municipal broadband network will remain net neutral. In Washington state, the Tacoma City Council passed a resolution at its Dec. 19 meeting asking the Public Utility Board to contractually require all ISPs using the municipal broadband network to follow net-neutrality rules. A Seattle councilmember and an Erie County legislator in New York are among those also calling for net-neutral municipal broadband networks. In Tennessee, Chattanooga’s Electric Power Board said it will uphold net neutrality on the city’s muni broadband network regardless of FCC rules.

Muni broadband networks are more likely to maintain net neutrality than national ISPs, said Chris Mitchell, director-community broadband networks at the Institute for Local Self-Reliance. “When AT&T raises its prices, imposes onerous data caps, or creates new tollbooths to charge extra for some content, most people have no recourse,” Mitchell said. “If a municipal network engaged in those practices, the mayor and city council would hear about it pronto and would likely change the practice before they got booted out of office.” Also, muni networks have too little influence to gain from violating net neutrality, Mitchell said. If Tullahoma, Tennessee, “which has a municipal fiber-to-the-home project, tries to extort money from Netflix, Netflix won't notice.”

But only about 1 percent of the U.S. population can choose municipal broadband, acknowledged Mitchell, citing ILSR’s Dec. 20 report on consumers’ limited options. And Panettieri warned that big private ISPs that oppose municipal broadband could use their market power to disadvantage muni networks or influence their policies: “The market norms could look very different in a few years.”

Muni broadband is a “wrong-headed response” to the FCC order, said Doug Brake, Information Technology and Innovation Foundation senior telecom policy analyst, who backed Title I reclassification. Brake doesn’t expect dramatic changes to major ISPs’ business models, “so the momentum to investigate uneconomical alternatives, ‘neutral’ or not, is unfounded,” he said. Muni networks, especially wireless mesh operators, may “strongly benefit from aggressive network management to limit video traffic,” he said. “We should be working on bipartisan compromise legislation rather than throwing good money at bad projects.”