Amicus Curiae Brief — Federal Communications Commission, et al., Petitioners v. Consumers' Research, et al.

Supreme Court briefJan 16, 2025

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NOS. 24-354 and 24-422

In the

Supreme Court of the United States

________________________________

FEDERAL COMMUNICATIONS COMMISSION, ET AL.,

Petitioners,

CONSUMERS’ RESEARCH, ET AL.,

________________

Respondents.

SCHOOLS, HEALTH & LIBRARIES BROADBAND COALITION,

ET AL.,

Petitioners,

CONSUMERS’ RESEARCH, ET AL.,

________________

Respondents.

On Writ of Certiorari to the

U.S. Court of Appeals for the Fifth Circuit

________________

BRIEF OF COLORADO AND 21 STATES AND

THE MAINE OFFICE OF THE PUBLIC

ADVOCATE AS AMICI CURIAE

IN SUPPORT OF PETITIONERS

________________

PHILIP J. WEISER

Attorney General

SHANNON STEVENSON

Solicitor General

Counsel of Record

RUSSELL D. JOHNSON

JUDSON CARY

MICHEL SINGER NELSON

DAYNA ZOLLE HAUSER

LANE TOWERY

SEAN ONWUALU

Office of the Colorado

Attorney General

1300 Broadway, 10th Floor

Denver, Colorado 80203

Shannon.Stevenson@coag.gov

(720) 508-6000

Counsel for the State of Colorado

TABLE OF CONTENTS

TABLE OF CONTENTS ............................................. i

TABLE OF AUTHORITIES ...................................... iii

INTERESTS OF THE AMICI .................................... 1

SUMMARY OF THE ARGUMENT ........................... 3

ARGUMENT ............................................................... 5

The USF Has Provided the Precise Benefits

Congress Intended. .............................................. 5

A. Congress Has Clearly Legislated the

Importance of Universal Service. ................ 5

B. For Decades, the USF Has Functioned to

Provide the Benefits Congress Intended

and Whose Loss Would be Highly

Disruptive. .................................................. 14

1. The High Cost Program Has

Benefitted

Rural

Users

and

Providers. ............................................. 14

2. The Fund Has Benefitted Rural

Healthcare. .......................................... 16

3. The E-Rate Program Has Benefitted

Schools and Libraries. ......................... 18

4. The Lifeline Program Has Benefitted

Tribes and Low-Income Users. ........... 22

5. The Loss of These Programs Will

Harm the Many Constituencies That

Rely on Them in Expected and

Unexpected Ways. ............................... 23

II. This Case Is a Poor Vehicle to Revisit the

Nondelegation Doctrine..................................... 26

A. Congress’ Universal Service Program Is

Guided by an Intelligible Principle that

Has Allowed the FCC to Permissibly

Implement Congress’ Policy Decisions. ..... 26

B. The Assistance USAC Provides to the

FCC in Achieving Congress’ Universal

Service Directives Does Not Violate the

Private Nondelegation Doctrine. ............... 29

C. Continuation of the USF Promotes

Cooperative Federalism. ............................ 31

D. Implementation

the

USF

Transparent and Does Not Implicate the

Nondelegation Doctrine’s Concerns. .......... 34

1. Governmental Oversight. ..................... 34

2. Congressional Oversight. ..................... 36

3. Checks on and Challenges to USAC

and FCC Determinations. ................... 38

CONCLUSION ......................................................... 40

iii

TABLE OF AUTHORITIES

Cases

Am. Power & Light Co. v. SEC,

329 U.S. 90 (1946) .................................................. 27

Carter v. Carter Coal Co.,

298 U.S. 238 (1936) ................................................ 29

Consumers’ Research v. FCC,

67 F.4th 773 (6th Cir. 2023) ............................ 27, 31

Consumers’ Research v. FCC,

88 F.4th 917 (11th Cir. 2023) .......................... 31, 39

Currin v. Wallace,

306 U.S. 1 (1939) .................................................... 29

Gundy v. United States,

588 U.S. 128 (2019) .......................................... 27, 28

J.W. Hampton, Jr. & Co. v. United States,

276 U.S. 394 (1928) ................................................ 26

Sandwich Isles Commc’ns, Inc. v. United

States,

992 F.3d 1355 (Fed. Cir. 2021) .............................. 39

Sunshine Anthracite Coal Co. v. Adkins,

310 U.S. 381 (1940) .................................... 29, 30, 39

Whitman v. Am. Trucking Ass’n,

531 U.S. 457 (2001) ................................................ 26

Yakus v. United States,

321 U.S. 414 (1944) ................................................ 28

Statutes & Session Laws

28 U.S.C. § 2342 (2024) ............................................ 39

47 U.S.C. § 251(f) (2024)........................................... 33

47 U.S.C. § 254(a)(1) (2024) ............................... 32, 33

47 U.S.C. § 254(b) (2024) .......................................... 33

47 U.S.C. § 254(b)(2) (2024) ................................. 9, 26

47 U.S.C. § 254(b)(3) (2024) ....................................... 9

47 U.S.C. § 254(b)(6) (2024) ....................................... 9

47 U.S.C. § 254(c)(1) (2024) .................................. 9, 28

47 U.S.C. § 254(c)(1)(A) (2024) ................................. 10

47 U.S.C. § 254(c)(1)(B) (2024) ................................. 10

47 U.S.C. § 254(c)(1)(C) (2024) ................................. 10

47 U.S.C. § 254(c)(1)(D) (2024)................................. 10

47 U.S.C. § 254(c)(2) (2024) ...................................... 13

47 U.S.C. § 254(d) (2024) .......................................... 26

47 U.S.C. § 254(f) (2024)........................................... 33

47 U.S.C. § 254(h)(1)(A) (2024) ................................ 17

47 U.S.C. § 254(h)(1)(B) (2024) ................................ 18

47 U.S.C. § 254(h)(2) (2024) ....................................... 9

47 U.S.C. § 254(i) (2024)........................................... 33

47 U.S.C. § 254(j) (2024) ........................................... 22

47 U.S.C. § 402 (2024) .............................................. 39

American Recovery & Reinvestment Act of

2009, Pub. L. No. 111-5, 123 Stat. 115 ................. 12

American Rescue Plan Act of 2021, Pub. L.

No. 117-2, 135 Stat. 4 ............................................ 37

Communications Act of 1934, Pub. L. No. 73652, 48 Stat. 1064 .................................................... 5

Consolidated Appropriations Act, 2018, Pub.

L. No. 115-141, 132 Stat. 348 ................................ 37

Consolidated Appropriations—FY 2001, Pub.

L. No. 106-554, 114 Stat. 2763 (2000) ................... 37

Dep’ts of Commerce, Justice, and State, the

Judiciary, and Related Agencies

Appropriations Act, 1998, Pub. L. No. 105119, 111 Stat. 2440, (1997) .................................... 36

Frank R. Lautenberg Chemical Safety for the

21st Century Act, Pub. L. No. 114-182, 130

Stat. 448 (2016) ...................................................... 37

Infrastructure Investment and Jobs Act,

Pub. L. No. 117-58, 135 Stat. 429 (2021) .............. 36

Telecommunications Act of 1996, Pub. L. No.

104–104, 110 Stat. 56 ...................................... 6, 7, 8

Regulations

47 C.F.R. § 54.702(b) (2024) ................................. 9, 31

47 C.F.R. § 54.702(c) (2024) ........................... 9, 31, 39

47 C.F.R. § 54.702(f) (2024) ...................................... 31

47 C.F.R. § 54.702(g) (2024) ..................................... 31

47 C.F.R. § 54.702(h) (2024) ..................................... 31

47 C.F.R. § 54.709(a)(3) (2024)................................. 31

47 C.F.R. § 54.712 (2024) ........................................... 8

47 C.F.R. § 54.717 (2024) ................................... 31, 36

47 C.F.R. § 54.719(b) (2024) ..................................... 39

47 C.F.R. § 54.802(c) (2024) ..................................... 25

47 C.F.R. §§ 54.500–.523 (2024) ............................... 18

47 C.F.R. §§ 54.701–.717 (2024)............................... 30

47 C.F.R. §§ 54.801–.806 (2024)............................... 13

Administrative Materials

Addressing the Homework Gap Through the

E-Rate Program, 89 Fed. Reg. 67303

(August 20, 2024) ................................................... 21

American Broadband & Telecommunications

Company, 33 FCC Rcd. 10308 (2018) ................... 37

Connect America Fund, 26 FCC Rcd. 17663

(2011) ...................................................................... 13

FCC OFFICE OF THE INSPECTOR GEN., INITIAL

STATISTICAL ANALYSIS OF DATA FROM THE

2006/2007 COMPLIANCE AUDITS (Oct. 3,

2007)

https://docs.fcc.gov/public/attachments/DO

C-277103A3.pdf ..................................................... 35

FCC OFFICE OF THE INSPECTOR GEN., REPORT

NO. 23-AUD-02-01, PERFORMANCE AUDIT OF

THE UNIVERSAL SERVICE FUND, RURAL

HEALTHCARE, TELECOMMUNICATIONS

PROGRAM AT NEW RIVER VALLEY

COMMUNITY SERVICE FOR FY 2019 AND FY

2020 (Feb. 28, 2024)

https://www.fcc.gov/sites/default/files/23aud-02-01_pa_usf_rhc_nrvcs_02282024.pdf ......... 35

FCC OFFICE OF THE INSPECTOR GEN., REPORT

NO. 24-AUD-01-01, AUDIT OF THE FEDERAL

COMMUNICATIONS COMMISSION’S FY 2023

COMPLIANCE WITH PAYMENT INTEGRITY

INFORMATION ACT OF 2019 REQUIREMENTS

(May 29, 2024)

vii

https://www.fcc.gov/sites/default/files/24aud-01-01_fy23_piia_05292024.pdf....................... 35

FCC OFFICE OF THE INSPECTOR GENERAL,

SEMIANNUAL REPORT TO CONGRESS, APRIL 1,

2007-SEPTEMBER 30, 2007 (Oct. 31, 2007)

https://docs.fcc.gov/public/attachments/DO

C-278589A1.pdf ..................................................... 35

FED. COMMC’NS COMM’N, CONNECTING

AMERICA: THE NATIONAL BROADBAND PLAN

(2010) https://www.fcc.gov/general/nationalbroadband-plan ................................................ 12, 13

FED. COMMC’NS COMM’N, E-RATE: UNIVERSAL

SERVICE PROGRAM FOR SCHOOLS AND

LIBRARIES (Dec. 31, 2019)

https://www.fcc.gov/sites/default/files/erate_universal_service_program_for_school

s_and_libraries.pdf ................................................ 19

FED. COMMC’NS COMM’N, RHC PROGRAM

COMMITMENTS (Aug. 8, 2024)

https://docs.fcc.gov/public/attachments/DO

C-404602A6.pdf ..................................................... 17

Federal-State Joint Board on Universal

Service, 12 FCC Rcd. 8776 (1997) ........................... 8

First Quarter 1998 Universal Service

Contribution Factors Revised and

Approved, 12 FCC Rcd. 21881 (Dec. 16,

1997) ....................................................................... 39

Implementation of the Local Competition

Provisions in the Telecommunications Act

of 1996, 11 FCC Rcd. 15499 (1996) ..................... 6, 7

viii

Nat’l Ass’n of Regul. Util. Comm’ns, Reply

Comments on Report on the Future of the

Universal Service Fund (Mar. 17, 2021)

https://www.fcc.gov/ecfs/document/1031821

7503884/1 ............................................................... 34

Presentation, UNIVERSAL SERV. ADMIN. CO.,

Welcome to Rural Health Care

https://www.usac.org/wpcontent/uploads/about/documents/tribalnations/Tribal-Documents/WebinarSlides/RHC-101-Introduction-to-RHCPrograms-2023-1.pdf ............................................. 18

Press Release, Fed. Commc’ns Comm’n, FCC

Commits over $1.2 Billion in First Funding

Wave of Emergency Connectivity Fund

Program to Connect over 3.6 Million

Students (Sept. 24, 2021)

https://docs.fcc.gov/public/attachments/DO

C-376028A1.pdf ..................................................... 21

Press Release, Fed. Commc’ns Comm’n, FCC

Establishes 5G Fund for Rural America

(Oct. 27, 2020)

https://docs.fcc.gov/public/attachments/DO

C-367778A1.pdf ..................................................... 15

Promoting Telehealth in Rural Am., 34 FCC

Rcd. 7335 (2019)..................................................... 17

Proposed Fourth Quarter 2023 Universal

Service Contribution Factor, 38 FCC Rcd.

8362 (Sept. 13, 2023) ............................................. 38

Proposed Third Quarter 2023 Universal

Service Contribution Factor, 38 FCC Rcd.

5670 (June 14, 2023) .............................................. 38

Public Notice, Fed. Commc’ns Comm’n,

Public Notice (Auction 903) Closes Winning

Bidders Announced (Aug. 28, 2018)

https://docs.fcc.gov/public/attachments/DA18-887A1.pdf .......................................................... 14

Revised Second Quarter 2003 Universal

Service Contribution Factor, 18 FCC Rcd.

5097 (Mar. 21, 2003) .............................................. 38

Rural Digital Opportunity Fund Connect

America Fund, 35 FCC Rcd. 686 (2020) ......... 13, 14

UNIVERSAL SERV. ADMIN. CO., 2023 ANNUAL

REPORT (2024) https://www.usac.org/wpcontent/uploads/about/documents/annualreports/2023/2023_USAC_Annual_Report.p

df ....................................................................... 15, 17

UNIVERSAL SERV. ADMIN. CO., E-RATE

SEARCH COMMITMENTS TOOL

https://opendata.usac.org/stories/s/jj4vcm5x (last visited Jan. 14, 2025) ..................... 19, 20

UNIVERSAL SERV. ADMIN. CO., LIFELINE

PARTICIPATION RATE

https://www.usac.org/wpcontent/uploads/lifeline/documents/Data/Lif

eline-Participation-Rate.xlsx................................. 22

Universal Service, 62 Fed. Reg. 32862-01

(June 17, 1997)....................................................... 28

Other Authorities

140 CONG. REC. 14816 (1994) ................................... 32

About NARUC, Federal Government

Collaboratives, NAT’L ASS’N OF REGUL. UTIL.

COMM’NShttps://www.naruc.org/aboutnaruc/our-programs/federal-governmentcollaboratives/ (last visited Jan. 14, 2025)............ 32

About NARUC, History & Background, NAT’L

ASS’N OF REGUL. UTIL. COMM’NS (last

visited Jan. 14, 2025) ............................................. 33

ARRUPE JESUIT HIGH SCHOOL, SCHOOL

PROFILE (last visited Jan. 10, 2025) ..................... 19

CONG. RSCH. SERV., RL33979, UNIVERSAL

SERVICE FUND: BACKGROUND AND OPTIONS

FOR REFORM 15 (Oct. 25, 2011) ........................ 35, 36

Dana Goldstein, A School With 7 Students:

Inside the ‘Microschools’ Movement, N.Y.

TIMES (June 17, 2024)

https://www.nytimes.com/2024/06/17/us/pu

blic-schools-education-vouchermicroschools.html .................................................. 21

Edwin A. Rosenberg & John D. Wilhelm,

State Universal Service Funding and

Policy: An Overview and Survey 2 (Sept.

1998)

https://pubs.naruc.org/pub/E38AEE1F155D-0A36-3130-404476AEA395.......................... 32

E-RATE CENTRAL, FUNDING COMMITMENT

OVERVIEW: COLORADO ............................................ 19

Letter from Mark Stephens, Managing Dir.,

FCC, to Radha Sekar, CEO, Universal

Serv. Admin. Co. (Jan. 14, 2021)

https://www.fcc.gov/sites/default/files/fccletter-to-usac-01142021.pdf ................................... 36

Mayo Clinic, Telestroke (stroke telemedicine),

(Jan. 18, 2023)........................................................ 17

Moab City, Utah, U.S. CENSUS BUREAU ................... 17

News & Views, Rural Expansion Brings

Broadband to Pleasant Hill, Charter

Commc’ns (Sept. 13, 2023)

https://corporate.charter.com/newsroom/spe

ctrum-rural-expansion-brings-broadbandto-pleasant-hill ....................................................... 16

Philip J. Weiser, Federal Common Law,

Cooperative Federalism, and the

Enforcement of the Telecom Act, 76 N.Y.U.

L. REV. 1692 (2001) ................................................ 32

Press Release, NTCA-The Rural Broadband

Ass’n, NTCA Survey Highlights Significant

Risks of Skyrocketing Consumer Bills,

Plummeting Broadband Investment &

Loans in Peril if USF Support were

Eliminated (Sept. 4, 2024) https://

www.ntca.org/ruraliscool/newsroom/pressreleases/2024/4/ntca-survey-highlightssignificant-risks-skyrocketing ......................... 23, 25

Tejas N. Narechania & Erik Stallman,

Internet Federalism, 34 HARV. J.L. & TECH.

547 (2021) ............................................................... 32

xii

Telestroke Partnership Between U of U

Health and Moab Regional Hospital Saves

Patient’s Life, UNIV. OF UTAH (Feb. 2, 2021)

https://healthcare.

utah.edu/patient-stories/telestrokepartnership-between-u-of-u-health-andmoab-regional-hospital-saves ................................ 18

INTERESTS OF THE AMICI

For almost a century, Congress has embraced legislation that advances the extremely popular goal of

affordable universal access to communications services. For many decades, “universal service,” as this

policy is called, involved “implicit” subsidies that were

built into the overall regulated rate structure of a monopolistic local telephone system. This meant, for example, that urban customers paid above cost rates to

subsidize rural customers who paid below cost rates.

When Congress passed the Telecommunications Act of

1996 (1996 Act), however, it replaced the monopolybased implicit subsidy regime with explicitly funded

universal service. There, Congress expressly directed

the Federal Communications Commission (FCC) to

ensure universal service consistent with six specific

principles, and to fund this service through fees paid

by service providers.

Implementing Congress’ principles and instructions, the FCC has done just that through the Universal Service Fund (USF or Fund) and the Fund’s

related programs. As a result, advanced telecommunications and information services are now available in

rural and remote areas, in healthcare facilities, in

schools and libraries, and to low-income users. The decision below, which concluded that the detailed statutory provisions governing universal service violated

the nondelegation doctrine, would eradicate these essential programs and jeopardize the commitment to

universal service that Congress has clearly endorsed.

Amici here are the States of Colorado, Arizona,

Connecticut, Delaware, the District of Columbia, Ha-

wai‘i, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York,

North Carolina, Pennsylvania, Rhode Island, South

Dakota, Vermont, Wisconsin, and Wyoming, and the

Maine Office of the Public Advocate, and their interests in this issue are myriad and substantial. Universal service is essential to allow Amici’s citizens to

participate in virtually every aspect of modern life—

the economy, government, politics, healthcare, education, and cultural life. This access is critical, not just

to the users of the services provided through the Fund,

but to everyone who wishes to communicate with

them. Its eradication could seriously disrupt—at a

minimum—the overall development of the states’

economies, the provision of healthcare, and the education system.

Amici are further interested in this case because

the Fund operates under the supervision of a FederalState Joint Board that allows Amici to participate in

the development of these programs and to develop

complementary state programs to further bolster universal service. Some of the Amici have developed their

own state programs in reliance on the operation of the

Fund and its programs. Declaring the Fund unconstitutional would result in a major disruption of Amici’s

complementary efforts to provide universal service.

Finally, much of the funding provided by the USF

is distributed over long time periods, with telecommunications providers making investments in significant

infrastructure projects based on long-term payouts, or

schools entering long-term service contracts based on

the promise of subsidized rates. If the funding programs were eradicated, these entities would be subject

to financial chaos and potential bankruptcies, with

ripple effects extending to many other entities, like

public and private lenders, and resulting in the potential need for Amici to step in to prevent catastrophic

outcomes.

SUMMARY OF THE ARGUMENT

Since 1934, Congress has sought to ensure that

advanced communications technology is accessible

throughout the country. In the era of regulated telecommunications monopolies, this was accomplished

by a system of cross-subsidies where urban and rural

consumers paid the same rates even though the cost of

providing services to urban customers was less than

providing service to rural customers. But when Congress allowed competition to enter the communications market, it recognized that the cross-subsidy

system could no longer achieve universal service and

put a new structure in place: the USF.

Implemented by the FCC and administered by the

Universal Service Administrative Company (USAC)

with the FCC’s oversight, the USF has worked hard to

achieve Congress’ vision—following the statutory

principles and other detailed limits that Congress laid

out. Because of the USF, entire swaths of the country

have broadband access, allowing them to participate

in civic and community life to the same extent as their

urban counterparts. Rural hospitals are better able to

provide life-saving care in areas of the country that

have few local specialized providers. Schools and libraries with fewer resources can provide many of the

same opportunities to their students and patrons as

those in better-funded communities. And people of

limited means are able to afford phone service.

Invalidating the USF, as respondents seek here,

would result not only in the loss of these benefits to

the detriment of the many constituencies that Congress intended to help, but it would also have substantial negative consequences for other stakeholders.

Many service providers, schools, and others have

made long-term investments and agreements in reliance on the availability of USF funds. Its sudden loss

would mean cuts in other services, diminished access

to the technology Congress wanted to be made universally available, and in some instances, bankruptcies

and job losses.

There is no reason for any of these devastating

consequences to come to pass. The USF does not violate the nondelegation doctrine because Congress provided intelligible principles to guide the FCC’s

exercise of authority. And in enacting the USF, Congress made the difficult policy decisions about whether

to provide universal service and how it should be

funded, leaving it to the FCC to fill in the details consistent with the principles and limits Congress set

forth in the 1996 Act. Furthermore, the FCC’s creation

of USAC to provide administrative services for the

USF does not violate the private nondelegation doctrine because USAC operates entirely under the FCC’s

authority and supervision. Finally, given the role the

Federal-State Joint Board plays and the history of

state involvement in universal service efforts, nothing

about the USF undermines federalism; to the contrary, the USF is a model of cooperative federalism.

The USF is also subject to several different oversight mechanisms that can address any issues that

arise with the program. The FCC’s Office of the Inspector General routinely audits the USF; Congress

holds regular hearings regarding the USF; USAC’s

recommendations can be challenged before the FCC;

and the FCC’s decisions can be challenged in court.

Many different avenues exist to ensure the program

functions as Congress intended.

Nearly thirty years ago, Congress enacted the current universal service regime to the benefit of the entire country. Losing this vital program would be

devastating and is not constitutionally required. This

Court should reverse the decision below.

ARGUMENT

The USF Has Provided the Precise Benefits

Congress Intended.

A. Congress Has Clearly Legislated the Importance of Universal Service.

For almost a century, universal service has been

a guiding principle of Congress’ telecommunications

policy. In the 1934 Communications Act, Congress assigned the FCC the task of “regulating interstate and

foreign commerce in communication by wire and radio

so as to make available, so far as possible, to all the

people of the United States a rapid, efficient, Nationwide, and world-wide wire and radio communications

service with adequate facilities at reasonable

charges.” Communications Act of 1934, Pub. L. No. 73652, § 1, 48 Stat. 1064 (codified as amended at 47

U.S.C. § 151).

For most of the 20th century, telecommunications

regulation was premised “on the belief that service

could be provided at the lowest cost to the maximum

number of consumers through a regulated monopoly

network.” Implementation of the Local Competition

Provisions in the Telecommunications Act of 1996,

11 FCC Rcd. 15499, 15505 (1996) (Local Competition

Order). In this environment, “universal service” was

achieved primarily through implicit or cross-subsidies. Like the commitment of the Post Office to provide

mail service to rural and urban communities at the

same prices, monopoly providers priced telephone service at uniform levels for rural and urban communities. This meant that urban communities paid abovecost rates so that rural communities could be served

below cost. And because business customers were provided service at higher rates than residential customers, that cross-subsidy constituted a second form of

implicit subsidies that were built into the rate structure. Finally, long-distance rates were also priced well

above costs as a means of subsidizing local rates.

The 1996 Act fundamentally changed the telecommunications marketplace. For the first time, it required local telephone companies to open their

networks to competition. E.g., Telecommunications

Act of 1996, Pub. L. No. 104–104, §§ 251–261, 110

Stat. 56, 61–79 (codified as amended at 47 U.S.C.

§§ 251–261). At the same time, the 1996 Act also reconceived of how to advance the policy of universal service. Id. § 254(b), 110 Stat. at 71–72 (codified at 47

U.S.C. § 254(b)). Rather than furthering universal service through implicit subsidies, the Act created an express funding mechanism: charges paid by carriers.

Id., § 254(d), 110 Stat. at 73. In its Local Competition

Order, the FCC observed that the implicit subsidy system needed to be reworked to enable competition to be

the “driving force” to guarantee affordable service to

all Americans. Local Competition Order, 11 FCC Rcd.

at 15507. The Commission recognized that the old system distorted, rather than enhanced, competition and

that “universal service reform was vitally connected”

to the new focus on local competition. Id. (cleaned up).

The Act formalized Congress’ commitment to a

new model of universal service by creating a FederalState Joint Board, comprised of FCC Commissioners,

state utility commissioners, and a state consumer advocate, to make recommendations to the FCC about

how to modernize universal service systems. 1996 Act,

§ 254(a), 110 Stat. at 71. The Act also set forth detailed

guidelines that the FCC and the Joint Board must consider in order to preserve and advance universal service. Id. § 254(b), 110 Stat. at 71–72. Specifically,

Congress instructed the FCC and the Joint Board to

base their policies on six principles:

1. quality services should be available at just,

reasonable, and affordable rates;

2. access to advanced telecommunications and

information services should be provided in

all regions of the Nation;

3. access by low-income and those in rural, insular and high-cost areas to telecommunications and information services should be

comparable to those provided in urban areas

at rates reasonably comparable to those

charged for similar services in urban areas;

4. all telecommunications service providers

must contribute;

5. support mechanisms should be specific, predictable, and sufficient to preserve and advance universal service; and

6. schools, health care, and libraries should

have access to advanced telecommunications services.

Id. § 254(b)(1)–(6), 110 Stat. at 71–72.

In addition to these specific principles, Congress

authorized the FCC and the Joint Board to adopt

“such other principles … [that] are necessary and appropriate for the protection of the public interest, convenience, and necessity.” Id. § 254(b)(7), 110 Stat. at

72.

The FCC implemented Congress’ directions by establishing four programs: the High Cost Program, to

support network deployment and maintenance cost in

rural areas, Federal-State Joint Board on Universal

Service, 12 FCC Rcd. 8776, 8995–9001 (1997) (Universal Service Order); the low-income programs (Lifeline

and Link Up), to make service affordable for low-income households and low-income residents of Tribal

lands, id. at 8952–93; the E-Rate Program (also known

as the Schools and Libraries program), to help offset

communications service costs to schools and libraries,

id. at 9002–92; and the Rural Health Care Program,

to support communications service to rural health care

providers, id. at 9093–9156. These programs are supported by contributions from telecommunications service providers, including wireline, wireless, and

interconnected Voice over Internet Protocol (VoIP)

providers, based on an assessment on their interstate

and international end-user revenues. 47 C.F.R.

§ 54.712.

To implement universal service reform, the FCC

created and designated USAC as the program administrator to annually bill contributors, collect contributions, and disburse funds. 47 C.F.R. § 54.702(b). The

FCC prohibited USAC from making policy, interpreting unclear provisions of the statute or rules, or interpreting Congressional intent. If the Act or rules are

unclear, USAC must seek guidance from the FCC. 47

C.F.R. § 54.702(c).

Central to these efforts was Congress’ direction

that “[a]ccess to advanced telecommunications and information services should be provided in all regions of

the Nation.” 47 U.S.C. § 254(b)(2); see also id.

§ 254(b)(3) & (6), (h)(2) (affirming the need for access

to advanced telecommunications and information services for rural and high-cost areas, as well as schools,

healthcare providers, and libraries). But Congress

knew that what was considered “advanced telecommunications and information services” would change

over time. Indeed, between 1934 and 1996, the country

had witnessed the invention of fax machines, car

phones, handheld cellular phones, and dial-up internet service.

And so, Congress expressly recognized that “[u]niversal service is an evolving level of telecommunications services” that would need to be evaluated from

time to time to account for “advances in telecommunications and information technologies and services.”

47 U.S.C. § 254(c)(1). To conduct that evaluation, Congress set standards and then delegated authority to

the Commission to apply those standards when determining the types of services necessary to achieve Congress’ goal of ensuring that no part of the nation was

left behind in the ever-evolving technological landscape.

Specifically, Congress statutorily directed the

Commission to consider the extent to which such telecommunications services:

(A) are essential to education, public

health, or public safety;

(B) have, through the operation of market

choices by customers, been subscribed

to by a substantial majority of residential customers;

(D) are consistent with the public interest, convenience, and necessity.

Id. § 254(c)(1)(A)–(D).

As time passed and technology advanced, Congress enacted another key statute to further improve

access to broadband services throughout the United

States. In 2009, Congress instructed the FCC and the

Assistant Secretary of Commerce for Communications

and Information to establish the Broadband Technology Opportunities Program (BTOP) to:

1. provide access to broadband service

to consumers residing in unserved areas of the United States;

2. provide improved access to broadband service to consumers residing in

underserved areas of the United

States;

3. provide broadband education, awareness, training, access, equipment,

and support to-a. schools, libraries, medical and

healthcare providers, community colleges and other institutions of higher education, and

other community support organizations and entities to facilitate

greater use of broadband service

by or though these organizations;

b. organizations and agencies that

provide outreach, access, equipment, and support services to facilitate greater use of broadband

service by low-income, unemployed, aged, and otherwise vulnerable populations; and

c. job-creating strategic facilities

located within a State-designated economic zone, Economic

Development District designated by the Department of

Commerce, Renewal Community or Empowerment Zone designated by the Department of

Housing and Urban Development, or Enterprise Community

designated by the Department of

Agriculture;

4. improve access to, and use of, broadband service by public safety agencies; and

5. stimulate the demand for broadband,

economic growth, and job creation.

American Recovery & Reinvestment Act of 2009, Pub.

L. No. 111-5, § 6001, 123 Stat. 115, 512–13 (codified at

47 U.S.C. §1305(a) and (b)).

As part of the same legislation, Congress directed

the FCC to develop a National Broadband Plan to “ensure that all people of the United States have access

to broadband capability.” Id. § 6001, 123 Stat. at 515–

16 (codified at 47 U.S.C. § 1305(k)(2)) (cleaned up).

Congress also required the plan to include a detailed

strategy for achieving affordability and maximizing

use of broadband to advance “consumer welfare, civic

participation, public safety and homeland security,

community development, health care delivery, energy

independence and efficiency, education, worker training, private sector investment, entrepreneurial activity, job creation and economic growth, and other

national purposes.” Id. § 6001, 123 Stat. at 516.

After receiving significant public comment, holding several workshops, and collaborating with other

government agencies and Congress, in early 2010, the

FCC submitted the National Broadband Plan (Plan) to

Congress, which included detailed recommendations

on each of the topics it was directed to address. FED.

COMMC’NS COMM’N, CONNECTING AMERICA: THE

NATIONAL BROADBAND PLAN (2010), https://www.fcc

.gov/general/national-broadband-plan.

One key recommendation set forth in the Plan

was to establish the Connect America Fund (CAF) to

ensure universal access to affordable broadband and

voice services. Id. at 145–46. In 2011, the FCC issued

its lengthy Report and Order to create the CAF and

shift USF from a voice-centric High Cost program and

prioritize broadband service. Connect America Fund,

26 FCC Rcd. 17663 (2011) (Connect America Fund Order), aff’d sub nom. In re FCC 11-161, 753 F.3d 1015

(10th Cir. 2014). In the Connect America Fund Order,

the FCC established goals to guide the transition to

support broadband services:

1. preserve and advance voice service;

2. ensure universal access to voice and broadband to homes, businesses and anchor institutions;

3. ensure mobile voice and broadband availability where Americans live, work or travel;

4. ensure reasonably comparable rates for

broadband and voice services; and

5. minimize universal contribution burden on

consumers and businesses.

Id. at 17680–83. More recently, the FCC also adopted

a universal service program to support wireless broadband service in underserved areas. Rural Digital Opportunity Fund Connect America Fund, 35 FCC Rcd.

686 (2020) (RDOF Order); see also 47 C.F.R.

§§ 54.801–.806.

To further ensure that the concept of universal

service did not lag behind the times—leaving millions

of Americans without the benefits Congress intended

to provide—Congress authorized the occasional reconsideration of the types of services that qualified for

universal service support. 47 U.S.C. § 254(c)(2). The

evolving nature of “universal service,” guided by the

1996 Act’s standards is an important feature of the

system Congress created.

B. For Decades, the USF Has Functioned to

Provide the Benefits Congress Intended

and Whose Loss Would be Highly Disruptive.

The High Cost Program Has Benefitted Rural Users and Providers.

The High Cost program (later enacted as the CAF

and Rural Digital Opportunity Fund (RDOF)) provides support to eligible telecommunications carriers

to deliver affordable voice and broadband service in

rural areas that would otherwise be unserved or underserved. See generally RDOF Order, 35 FCC Rcd.

686 (2020). The FCC designates unserved or underserved rural communities where the market alone

cannot support the costs to deploy network infrastructure. Id. at 690–94. In 2018, the Commission conducted an auction to deliver High Cost funds to eligible

areas across the United States through which $1.49

billion was allocated over ten years to provide fixed

broadband and voice services to over 700,000 locations

in 45 states. Public Notice, Fed. Commc’ns Comm’n,

Connect America Fund Phase II Auction (Auction 903)

Closes Winning Bidders Announced (Aug. 28, 2018),

https://docs.fcc.gov/public/attachments/DA-18-887A1

.pdf. Less than two years later, in October 2020, the

Commission established the 5G Fund to distribute another $9 billion in universal service support to bring

5G mobile broadband service to rural America, including $680 million to serve Tribal lands. Press Release,

Fed. Commc’ns Comm’n, FCC Establishes 5G Fund for

Rural America (Oct. 27, 2020), https://docs.fcc.gov

/public/attachments/DOC-367778A1.pdf.

According to the 2023 USAC Annual Report, in

2023 alone, the High Cost program “distributed $4.3

billion to telephone companies, cable and satellite providers, electric co-ops, and other carriers to build out

advanced network infrastructure and deliver affordable, reliable voice and broadband connections in communities that might otherwise be left unserved.”

UNIVERSAL SERV. ADMIN. CO., 2023 ANN. REP. 9 (2024)

(2023 USAC ANNUAL REPORT) https://www.usac

.org/wp-content/uploads/about/documents/annual-reports/2023/2023_USAC_Annual_Report.pdf.

In the country’s most rural states, the impacts of

these programs are profound. In South Dakota, for example, nearly the entire geographic area of the state

is served by local providers who depend on USF

Funds, as the map below shows:

The solid-colored areas on the map are supported

by the High-Cost program. The cross-hatched areas

reflect where providers were able to expand to provide

high-speed broadband to areas that otherwise would

not be served. In short, without the USF, the overwhelming majority of South Dakota would not have

broadband access.

A more granular example shows the value that

the Fund provides to rural communities. In 2021, a

tornado struck the small farm community of Pleasant

Hill, Tennessee, carving a nearly 6-mile path of destruction. To help rebuild the town, Charter Communications—with support from the RDOF—strung high

speed fiber, enabling emergency weather infrastructure that will protect against similar weather disasters in the future. The RDOF project also fostered new

economic opportunities for local businesses, such as

Linda’s Coffee Shop and Sunrise Dairy. With the benefits of high-speed broadband services, the town’s

mayor “looks at the emerging growth of family-run

Sunrise Dairy as just the beginning for the small rural

community.” News & Views, Rural Expansion Brings

Broadband to Pleasant Hill, Charter Commc’ns (Sept.

13,

2023),

https://corporate.charter.com/newsroom/spectrum-rural-expansion-brings-broadband-topleasant-hill.

The Fund Has Benefitted Rural

Healthcare.

Rural healthcare has also been significantly improved through the USF, as Congress intended. See

47 U.S.C. § 254(h)(1)(A). The Commission promotes

telehealth in rural areas through the Rural Health

Care Program (RHC Program), which provides financial support to help rural health care providers obtain

broadband and other communications services at discounted rates. These services are then used by

healthcare providers to offer telehealth to patients living in and around the communities they serve. Promoting Telehealth in Rural Am., 34 FCC Rcd. 7335,

7336 (2019). In 2023, the RHC program disbursed

more than $468 million to nearly 11,000 health care

providers. 2023 USAC ANNUAL REPORT 3, 13; FED.

COMMC’NS COMM’N, RHC PROGRAM COMMITMENTS 3–4

(Aug. 8, 2024), https://docs.fcc.gov/public/attachments/DOC-404602A6.pdf.

A clear example of the RHC Program’s success involves Moab, Utah. Outside of Moab (a town of approximately 5,300 people), 1 an individual who had a stroke

was taken to the local hospital where a CT scan was

performed. A communications technician at the hospital set up Telestroke, 2 which connected them to a University of Utah Medical Center neurologist. This

communications link allowed the neurologist to make

a time-sensitive diagnosis and to direct administration of a drug that resulted in almost immediate improvement of the patient’s condition. Presentation,

UNIVERSAL SERV. ADMIN. CO., Welcome to Rural

Health Care 16, https://www.usac.org/wp-content/upMoab City, Utah, U.S. CENSUS BUREAU, https://data.census.gov/profile/Moab_city,_Utah?g=160XX00US4950700

(last

visited Jan. 14, 2025).

Telestroke is a telemedicine approach for connecting

healthcare providers in smaller communities with neurological

experts who are more commonly located in urban centers. Mayo

Clinic, Telestroke (stroke telemedicine), (Jan. 18, 2023),

https://www.mayoclinic.org/tests-procedures/stroke-and-telemedicine/about/pac-20395081.

loads/about/documents/tribal-nations/Tribal-Documents/Webinar-Slides/RHC-101-Introduction-toRHC-Programs-2023-1.pdf (last visited Jan. 14, 2025);

see also Telestroke Partnership Between U of U Health

and Moab Regional Hospital Saves Patient’s Life,

UNIV. OF UTAH (Feb. 2, 2021), https://healthcare.

utah.edu/patient-stories/telestroke-partnership-between-u-of-u-health-and-moab-regional-hospitalsaves (relating how a Texas man traveling in Utah

was helped after he had a stroke). Having broadband

access throughout the country is necessary to be able

to provide this kind of care, which can save lives and

avoid debilitating, lifelong symptoms, no matter

where someone lives or may be visiting.

The E-Rate Program Has Benefitted

Schools and Libraries.

Congress dictated as a principle of universal service that “[e]lementary and secondary schools and

classrooms . . . and libraries should have access to advanced telecommunications services.” 47 U.S.C.

§ 254(b)(6). To that end, it mandated that all “telecommunications carriers serving a geographic area” must

“provide such services to elementary schools, secondary schools, and libraries” at “rates less than the

amounts charged for similar services to other parties.”

47 U.S.C. § 254(h)(1)(B). And through the E-Rate program, the Fund offsets the cost to carriers of that otherwise-unfunded mandate. See 47 C.F.R. §§ 54.500–

.523 (rules for E-Rate program).

The E-Rate program’s results are impressive. In

Colorado, for example, every single school district participates—with discounts ranging from 20% for the

wealthiest districts to 90% for the neediest schools, allowing far more internet access than these districts

could otherwise afford to give students. See FED.

COMMC’NS COMM’N, E-RATE: UNIVERSAL SERVICE

PROGRAM FOR SCHOOLS AND LIBRARIES (Dec. 31, 2019),

https://www.fcc.gov/sites/default/files/e-rate_universal_service_program_for_schools_and_libraries.pdf.

Colorado’s E-Rate subsidies now average more than

$26.5 million annually (statewide) and have totaled

nearly $670 million since 1998. E-RATE CENTRAL,

FUNDING COMMITMENT OVERVIEW: COLORADO,

https://tools.e-ratecentral.com/us/stateInformation.asp?state=CO (last visited Jan. 14, 2025).

That average annual subsidy accounts for well

over half the cost of schools’ internet services. Schools

like Arrupe Jesuit High School, a Catholic school in

one of West Denver’s historic Chicano neighborhoods, 3

gets a 90% discount on its internet service—thus

providing students 10 times more service than it could

otherwise get for the same dollars. UNIVERSAL SERV.

ADMIN. CO., E-RATE SEARCH COMMITMENTS TOOL,

https://opendata.usac.org/stories/s/jj4v-cm5x. 4 Atlas

Preparatory School and Salida del Sol—charter

schools bringing rigorous, college-prep curricula to

high-poverty neighborhoods in Colorado Springs and

Greeley, respectively—likewise bring connectivity to

ARRUPE JESUIT HIGH SCHOOL, SCHOOL PROFILE, https://arrupejesuit.com/who-we-are/school-profile.html (last visited Jan.

14, 2025).

4 To identify the entry for Arrupe Jesuit High School, filter the

detailed funding report data by funding year “2023” and billed

entity state by “CO”; download the resulting Detailed Funding

Report; search for “Arrupe Jesuit High School” in the report data.

their students for ten cents on the dollar. Id. 5 And the

same 90% discount applies district-wide to Mountain

Valley School District and Sierra Grande School District in the San Luis Valley; the tiny Huerfano School

District and Aguilar School District on the drive south

of Pueblo, Colorado; remote Granada School District

and Vilas School District, on the eastern plains; and

Sheridan School District and Adams 14 School District, in inner-ring Denver suburbs where more than

85% of students qualify for free or reduced price

lunches. Id. 6

These funds are essential to schools and libraries,

and there would be hard budgetary choices to be

made—requiring large cuts to life-altering programs—if these dollars go away. And beyond budgets,

the E-Rate program has created new opportunities for

innovation. Most notably, as many schools shifted to

remote learning during the COVID-19 pandemic, Congress authorized funding through the FCC to assist

schools in providing internet access to support remote

learning. E.g., Press Release, Fed. Commc’ns Comm’n,

FCC Commits over $1.2 Billion in First Funding Wave

5 To locate the information for Atlas Preparatory School and

Salida del Sol, search the previously downloaded Detailed Funding Report for those schools by name and identify the entries

where the “Service Type” listed in Column J is “Data Transmission and/or Internet Service.”

6 To locate E-Rate information for these school districts, search

the previously downloaded Detailed Funding Report for these

districts by name and identify the entries where the “Service

Type” listed in Column J is “Data Transmission and/or Internet

Service.” For demographic and geographic information, visit the

Colorado Department of Education’s “SchoolView” website at

https://www.cde.state.co.us/schoolview/explore/welcome/.

of Emergency Connectivity Fund Program to Connect

over 3.6 Million Students (Sept. 24, 2021),

https://docs.fcc.gov/public/attachments/DOC-376028A

1.pdf. Such connectivity had long been lacking in precisely the high-poverty communities most exposed to

the pandemic. This experience allowed the FCC to adjust the E-Rate program to provide schools more flexibility for mobile wi-fi and similar remote-learning

aids. E.g., Addressing the Homework Gap Through the

E-Rate Program, 89 Fed. Reg. 67303 (August 20,

2024). These investments have in turn fueled an explosion in educational innovation, as more and more

families explore online education, microschools, and

other nontraditional formats. E.g., Dana Goldstein, A

School With 7 Students: Inside the ‘Microschools’

Movement, N.Y.

TIMES

(June

17,

2024), https://www.nytimes.com/2024/06/17/us/public

-schools-education-voucher-microschools.html. Educational demands change just as fast as telecommunications technology does—and through the Fund’s

paired mandates and subsidies, the FCC has honored

Congress’ goal that the nature of covered service must

evolve over time.

As Congress intended, the E-Rate program has

provided universal connectedness for schools and libraries, kept up to date with the latest technology and

most pressing national needs, allowing Amici to prepare a new generation of technologically proficient

students to enter the workforce.

The Lifeline Program Has Benefitted Tribes and Low-Income Users.

Since even before the 1996 Act, the Commission’s

Lifeline program helped low-income consumers purchase phone lines. Congress made clear that it wanted

that program to continue when it passed the 1996 Act,

stating that nothing in the act affected “the collection,

distribution, or administration of [that program].” 47

U.S.C. § 254(j). And the program—funded by the

USF—has continued to operate, making modern telecommunications available to individuals throughout

the nation regardless of their financial status.

As of March 2024, the Commission’s data demonstrates that nearly 7.6 million subscribers have benefited from the Lifeline Program. UNIVERSAL SERV.

ADMIN. CO.,

LIFELINE PARTICIPATION RATE,

https://www.usac.org/wp-content/uploads/lifeline/documents/Data/Lifeline-Participation-Rate.xlsx.

But

just as with the programs above, the numbers do not

tell the whole story. The benefits provided through the

Lifeline Program make it possible for people to have a

phone they can answer when their work schedule

changes unexpectedly. They allow everyone in the

country to access information so they can participate

in the political process. These benefits are foundational to the ability to participate in modern society,

consistent with Congress’ goals.

The Loss of These Programs Will

Harm the Many Constituencies That

Rely on Them in Expected and Unexpected Ways.

Each of the programs and the benefits they provide rely on the framework Congress created in directing the FCC to establish universal service. Their loss

would be nothing short of catastrophic. Broadband

networks and whatever advanced technology follows it

would not reach rural America. 7 Cash-strapped

schools would lose the chance to provide their students

with the basic resources they need to thrive in the

modern world. Healthcare would be harder to access,

and outcomes will be poorer. People with fewer economic resources would be that much less connected to

their family, their friends, their work, and the nation.

Large swaths of America—contrary to Congress’ intent—would be left behind.

7 A recent survey by NTCA—The Rural Broadband Associa-

tion—found that 68% of respondent broadband service providers

(mostly small or rural broadband providers) said that, if the Fund

were abolished, they would need to cancel deployment projects

equaling over $1 billion, which represents nearly 79% of the providers’ planned broadband investments for 2025. Similarly, 71%

of respondents indicated they would need to cancel 2026 deployment projects, equaling nearly $900 million and representing

nearly 83% of planned investments for 2026. Press Release,

NTCA-The Rural Broadband Ass’n, NTCA Survey Highlights

Significant Risks of Skyrocketing Consumer Bills, Plummeting

Broadband Investment & Loans in Peril if USF Support were

Eliminated

(Sept.

2024),

https://www.ntca.org/ruraliscool/newsroom/press-releases/2024/4/ntca-survey-highlights-significant-risks-skyrocketing (NTCA Survey). The loss of

investment is not hypothetical, it will be overwhelming.

Each of these consequences is obvious. But they

do not tell the full story. The RDOF component of the

High Cost Program provides a stark example of the

less obvious, indirect impacts that would flow from upending the USF. Through RDOF, broadband providers

build networks at significant upfront expense using

their own capital and debt and then recoup costs

through annual RDOF reimbursements over 10 years.

For example, a $10 million RDOF award is paid out at

a rate of $1 million per year for 10 years. RDOF requires the broadband provider to meet certain build

out requirements:

40% complete by end of year 3.

60% complete by end of year 4.

80% complete by end of year 5.

100% complete by end of year 6.

47 C.F.R. § 54.802(c).

To continue with the example, then, by year 3, the

provider has already spent at least $1 million more

than they have received and by year 6, $4 million

more. This structure creates a built-in mismatch between the up-front expense of building the network

and when USF money is dispersed.

If the RDOF payments were terminated before

the full subsidy is received because the program ends,

providers would not be fully compensated for their

large up-front broadband construction expenses. So,

beyond the lack of broadband expansion into rural

America that would likely occur, RDOF-awarded

broadband providers who were “enticed” to build

through the RDOF program would be left only partly

compensated.

That gap in funding would then have follow-on effects. The debt the broadband providers accepted in

reliance on the RDOF funding must still be paid or the

provider could be forced into bankruptcy. Indeed,

when NTCA—The Rural Broadband Association conducted a survey of the potential impacts of the loss of

USF funding on its members, 61% of respondents indicated they would likely default on loans within the

next three years. NTCA Survey. And because 70% percent of service-provider respondents with outstanding

debt indicated their loans were with the U.S. Department of Agriculture, id., taxpayers may ultimately

foot the bill for broadband service provider bankruptcies.

This pattern of disrupted expectations would occur throughout the USF’s programs. Schools, hospitals, and libraries that signed long-term broadband

agreements in reliance on the E-Rate program would

be left with large, unfunded contractual obligations.

That money will need to come from somewhere else

whether it be teacher salaries, programming, supplies, or other improvements that would have to be forgone.

Similarly, the loss of the Lifeline Program means

that broadband service providers, local phone companies, small rural electric cooperatives, and other providers would not only lose the supplement the Lifeline

Program provides, they may also lose subscribers who

can no longer afford the services without the discount.

Those losses doubly harm the companies which rely on

not just the Lifeline Program, but also on the subscribers’ payment to stay afloat.

The end of the USF would have many negative

consequences, particularly for the direct beneficiaries

of the universal service Congress sought to create. But

it would also result in the many participants who help

the Nation stay connected and provide vital services

across the country—who relied on a long-standing,

successful program that Congress created in compliance with this Court’s precedent—being left to face the

consequences of its disappearance on their own.

II. This Case Is a Poor Vehicle to Revisit the

Nondelegation Doctrine.

A. Congress’ Universal Service Program Is

Guided by an Intelligible Principle that

Has Allowed the FCC to Permissibly Implement Congress’ Policy Decisions.

The programs described above implement the policy decisions Congress made when it passed the 1996

Act. It was Congress—not the FCC or USAC—that determined that everyone in the country should have access

the

same

types

“advanced

telecommunications and information services” regardless of their location or income. 47 U.S.C. § 254(b)(2).

And it was Congress that determined that the costs of

providing these services should be borne by telecommunication carriers at levels “sufficient” to achieve

Congress’ vision. 47 U.S.C. § 254(d).

To avoid an impermissible delegation of legislative power to an agency, Congress need only provide

an “intelligible principle” that guides an agency’s actions. Whitman v. Am. Trucking Ass’n, 531 U.S. 457,

472 (2001); J.W. Hampton, Jr. & Co. v. United States,

276 U.S. 394, 409 (1928). In other words, Congress

must make “clear to the delegee ‘the general policy’ he

must pursue and the ‘boundaries of [his] authority.’”

Gundy v. United States, 588 U.S. 128, 146 (2019) (plurality) (quoting Am. Power & Light Co. v. SEC, 329

U.S. 90, 105 (1946)).

The 1996 Act more than satisfies this standard.

The Sixth Circuit Court of Appeals, in considering this

same issue, described in detail how Congress had

made the important policy choices and limited the

Commission’s authority. Consumers’ Research v. FCC,

67 F.4th 773, 788–95 (6th Cir. 2023), cert. denied 144

S. Ct. 2628 (Mem.) (2024). As that court found, Congress set out in statute:

•

what Congress intended for the Commission

to pursue;

•

how the Commission must fund its efforts,

including who must pay and how to calculate the payment amounts;

•

the methods the Commission must use to

promote universal service;

•

who Congress intended to benefit from universal service; and

•

the kinds of services Congress intended to be

supported.

Id. (discussing the standards from 47 U.S.C. § 254).

These directives offer far more than a mere intelligible principle; they set out a comprehensive structure for how to achieve Congress’ goal of providing

universal service and give authority to the Commission to “fill up the details.” Gundy, 588 U.S. at 157

(Gorsuch, J., dissenting).

Take, for example, the determination of which

services are part of universal service. Congress laid

out specific factors the Commission would need to consider before setting the terms of “universal service”:

•

is the service “essential to education, public

health, or public safety”;

•

has the service “through the operation of

market choices by customers, been subscribed to by a substantial majority of residential customers”’;

•

is the service “being deployed in public telecommunications networks by telecommunications carriers”; and

•

is providing the service “consistent with the

public interest, convenience, and necessity.”

47 U.S.C. § 254(c)(1).

And just over a year after the passage of the 1996

Act, the Commission—with the assistance of the Joint

Board—applied Congress’ factors when considering at

least ten different types of services to determine

whether they should be part of the initial universal

service Congress intended to create. Universal Service, 62 Fed. Reg. 32862-01, 32863–66 (June 17, 1997).

Thus, “‘Congress, the courts, and the public’” can look

to the Commission’s actions, compare them against

the criteria Congress set forth, and determine

“whether Congress’s guidance has been followed.”

Gundy, 588 U.S. at 158, 166 (Gorsuch, J., dissenting)

(quoting Yakus v. United States, 321 U.S. 414, 426

(1944)). Here, Congress’ guidance has been followed.

As described above, the USF—funded by carrier con-

tributions—has increased access to advanced telecommunications and information services to communities

throughout the nation, all as Congress intended.

In creating the USF, Congress went beyond the

types of very broad principles this Court has previously approved as setting forth an intelligible principle; moreover, it reached the consensus necessary to

make the difficult policy choices embodied in the USF

program and told the Commission how to permissibly

implement those policies. Nothing in the USF’s structure violates this Court’s nondelegation jurisprudence.

B. The Assistance USAC Provides to the

FCC in Achieving Congress’ Universal

Service Directives Does Not Violate the

Private Nondelegation Doctrine.

This Court has long held that private parties cannot exercise legislative power. See, e.g., Currin v. Wallace, 306 U.S. 1, 15–16 (1939) (collecting cases). For

example, empowering a majority of coal producers and

miners in a given area to set maximum working hours

and minimum wages for all producers and miners was

an unconstitutional delegation of legislative power.

See Carter v. Carter Coal Co., 298 U.S. 238, 310–12

(1936).

By contrast, the private nondelegation doctrine is

not offended when private actors operate under the

“authority and surveillance” of a government agency

but lack their own “law-making” authority. Sunshine

Anthracite Coal Co. v. Adkins, 310 U.S. 381, 387–88,

399 (1940). In Sunshine Anthracite, coal producers

could become members of the Bituminous Coal Code,

and Code members would be broken into twenty district boards. While those boards could make various

types of proposals to the National Bituminous Coal

Commission within the Department of the Interior, including proposals regarding minimum pricing, the

Commission was the final authority that decided

whether those proposals became law. Id. at 388. Accordingly, there was no delegation of authority to the

private actors because the private actors lacked independent authority. The program was “unquestionably

valid.” Id. at 399.

USAC, too, lacks independent authority and is unquestionably valid. USAC’s operations are dictated by

and subject to the FCC. See generally 47 C.F.R.

§§ 54.701–.717. And the FCC’s rules make clear that

USAC operates under the FCC’s authority and surveillance and has no law-making power. Indeed, by

law, USAC cannot even “interpret unclear provisions

of the statute or rules, or interpret the intent of Congress.” 47 C.F.R. § 54.702(c). USAC is required to

bring those types of questions to the FCC. Id.

Instead, USAC engages in administrative functions like billing carriers, creating websites, and filing

reports with Congress and the Commission. See, e.g.,

47 C.F.R. § 54.702(b), (f)-(h). And it performs all of its

functions subject to the FCC’s oversight, including an

annual audit that must be approved by the FCC’s administrative staff and filed with the FCC for its review. 47 C.F.R. § 54.717.

To be sure, part of USAC’s administrative function includes proposing calculations that will set how

much carriers pay to support the universal service

programs. But even there, USAC has no authority to

set the contributions. Whether to accept USAC’s proposed calculations is entirely within the FCC’s discretion. 47 C.F.R. § 54.709(a)(3). At no point can USAC

exercise law-making authority.

Nothing about how USAC is structured and how

it supports the universal service programs under the

FCC’s “authority and surveillance” offends the private

nondelegation doctrine, as both the Sixth and Eleventh Circuits found. Consumers’ Research v. FCC, 88

F.4th 917, 925–28 (11th Cir. 2023); Consumers’ Rsch.

v. FCC, 67 F.4th 773, 795–97 (6th Cir. 2023). 8 Just as

Congress appropriately authorized the FCC to fill in

the gaps when executing Congress’ vision for universal service, the FCC properly created USAC to help

administer the universal service programs under the

FCC’s authority and supervision.

C. Continuation of the USF Promotes Cooperative Federalism.

Other state amici have urged this Court to deem

the USF unconstitutional as a means of promoting federalism, but that argument gets it backwards. See Br.

of Amici Curiae State of West Virginia, 14 Other

States, and the Arizona Legislature in Support of

Granting the Petition (States’ Cert. Amicus) at 3, 13–

17. Contrary to their generalized assertions that “federal agencies are a particular threat to States’ interests,” id. at 15, in the 1996 Act, Congress established

8 The opinion below expressed concern over how the FCC has

exercised its authority over USAC. See App. pp. 5a–7a. But that

is a practical concern that can be dealt with through multiple

proper channels, see infra § II.D, and does not provide a legal basis for invalidating the program.

what has long been considered “perhaps the most ambitious cooperative federalism regulatory program to

date.” Philip J. Weiser, Federal Common Law, Cooperative Federalism, and the Enforcement of the Telecom Act, 76 N.Y.U. L. REV. 1692, 1694 (2001); see also

Tejas N. Narechania & Erik Stallman, Internet Federalism, 34 HARV. J.L. & TECH. 547, 610–14 (2021). Indeed, Section 254’s first provision requires the

creation of a “Federal-State Joint Board” that must

work with the FCC to “recommend changes” to any

FCC regulations, including establishing “the definition of the services that are supported by Federal universal service support mechanisms and a specific

timetable for completion of such recommendations.”

47 U.S.C. § 254(a)(1). Moreover, when Congress was

considering the 1996 Act, states pressed for explicit

universal service supports—and Congress listened by

enacting Section 254. 140 CONG. REC. 14816–17 (1994)

(reprinting a letter from the National Association of

Attorneys General urging Congress to, among other

things, “preserve and promote universal telephone

service at fair, reasonable and affordable rates and

also provide a clear, broad definition of universal service”); see Edwin A. Rosenberg & John D. Wilhelm,

State Universal Service Funding and Policy: An Overview and Survey 2 (Sept. 1998), https://pubs.naruc

.org/pub/E38AEE1F-155D-0A36-3130-404476AEA

395.

Thus, the plain text of the 1996 Act requires collaboration between the FCC and the states to implement the USF. See About NARUC, Federal

Government Collaboratives, NAT’L ASS’N OF REGUL.

UTIL. COMM’NS, https://www.naruc.org/about-naruc/

our-programs/federal-government-collaboratives/

(last visited Jan. 14, 2025) (“The Joint Board, made up

of Federal Communications Commission members,

State utility regulators, and consumer advocates,

oversees and makes recommendations on the universal provisions of the 1996 Telecommunications Act.”).

The 1996 Act charges both the “Joint Board and the

Commission” with the “preservation and advancement

of universal service” based on six clear “principles.” 47

U.S.C. § 254(b); see also 47 U.S.C. § 254(i) (charging

the “Commission and the States” with ensuring that

“universal service is available at rates that are just,

reasonable, and affordable.”); 47 U.S.C. § 254(f) (authorizing states to adopt regulations to preserve and

advance universal service); 47 U.S.C. § 251(f) (allowing states to exempt rural carriers from certain requirements). There is, therefore, no reason for this

Court to find an unconstitutional delegation here to

purportedly “restore the States’ rightful role in the

lawmaking process.” States’ Cert. Amicus at 17-18.

The states already play an indispensable role in that

process under the current Federal-State Joint Board

model.

In fact, the National Association of Regulatory

Utility Commissioners (NARUC), the organization of

utility regulators from all 50 states, the District of Columbia, Puerto Rico, and the Virgin Islands, 9 has long

lauded the USF’s federal-state partnership. See About

NARUC, History & Background, NAT’L ASS’N OF

REGUL. UTIL. COMM’NS, https://www.naruc.org/aboutnaruc/our-mission/history-background/ (last visited

Jan. 14, 2025). As NARUC has explained, “in 1996,

9 Under the 1996 Act, a representative from NARUC maintains

a seat on the Federal-State Joint Board. 47 U.S.C. § 254(a)(1).

Congress recognized the crucial partnership between

the FCC and States on universal service issues—creating a structure that requires the FCC to work handin-glove with State commissions on Lifeline, High

Cost, and other universal service programs.” Nat’l

Ass’n of Regul. Util. Comm’ns, Reply Comments on

Report on the Future of the Universal Service Fund 4

(Mar. 17, 2021), https://www.fcc.gov/ecfs/document/10318217503884/1. NARUC has acknowledged

that “[l]audibly, the FCC and its staff have a long history of collaboration with States on USF issues,” and

NARUC has urged that “[t]he success of these programs requires collaboration to continue.” Id.; see also

id. at 22 (“NARUC looks forward to continued cooperation and coordination with the Commission on USF

issues.”). Striking down Section 254 would therefore

destroy, rather than promote, the USF’s robust system

of cooperative federalism.

D. Implementation of the USF is Transparent and Does Not Implicate the Nondelegation Doctrine’s Concerns.

The FCC has implemented the USF in compliance

with Congress’ statutory principles and consistent

with the principles of cooperative federalism that are

embedded in the 1996 Act. To the extent there are concerns regarding the USF’s operations, there are multiple channels through which those concerns can be

identified and addressed to prevent the program from

exceeding its statutory remit.

Governmental Oversight.

The FCC’s Office of the Inspector General (OIG)

actively oversees the USF to ensure compliance with

the 1996 Act. See, e.g., CONG. RSCH. SERV., RL33979,

UNIVERSAL SERVICE FUND: BACKGROUND AND OPTIONS

FOR REFORM 15 (Oct. 25, 2011) (CRS REPORT). As part

of that oversight, the OIG regularly conducts or arranges for the completion of audits of all four USF programs and of USF contributors. Id. Beginning in 2006,

this “large-scale beneficiary audit program” consisted

of 459 audits of USF program participants. See FCC

OFFICE OF THE INSPECTOR GENERAL, SEMIANNUAL

REPORT TO CONGRESS, APRIL 1, 2007-SEPTEMBER 30,

2007 17 (Oct. 31, 2007), https://docs.fcc.gov/public/attachments/DOC-278589A1.pdf; see, e.g., FCC OFFICE

OF THE INSPECTOR GEN., INITIAL STATISTICAL ANALYSIS

OF DATA FROM THE 2006/2007 COMPLIANCE AUDITS

(Oct. 3, 2007), https://docs.fcc.gov/public/attachments

/DOC-277103A3.pdf.

These audits have continued to this day, using

“generally accepted government auditing standards.”

FCC OFFICE OF THE INSPECTOR GEN., REPORT NO. 23AUD-02-01, PERFORMANCE AUDIT OF THE UNIVERSAL

SERVICE

FUND,

RURAL

HEALTHCARE,

TELECOMMUNICATIONS PROGRAM AT NEW RIVER

VALLEY COMMUNITY SERVICE FOR FY 2019 AND FY

2020 5–6 (Feb. 28, 2024), https://www.fcc.gov/sites/default/files/23-aud-02-01_pa_usf_rhc_nrvcs_02282024

.pdf (finding compliance with Rural Health Care Program laws, rules, and regulations); FCC OFFICE OF

THE INSPECTOR GEN., REPORT NO. 24-AUD-01-01,

AUDIT

THE

FEDERAL

COMMUNICATIONS

COMMISSION’S FY 2023 COMPLIANCE WITH PAYMENT

INTEGRITY INFORMATION ACT OF 2019 REQUIREMENTS 1

(May

29,

2024),

https://www.fcc.gov/sites/default/files/24-aud-01-01_fy23_piia_05292024.pdf.

Likewise, FCC rules require USAC to undergo annual audits to prevent waste, fraud, and abuse. 47

C.F.R. § 54.717. The FCC also regularly directs USAC

to take corrective action to recover any improper payments. See, e.g., Letter from Mark Stephens, Managing Dir., FCC, to Radha Sekar, CEO, Universal Serv.

Admin. Co. (Jan. 14, 2021), https://www.fcc.gov

/sites/default/files/fcc-letter-to-usac-01142021.pdf.

Congressional Oversight.

Congress itself also maintains substantial control

and oversight over the USF. For one thing, Congress

regularly holds oversight hearings regarding the FCC

and the USF. See, e.g., CRS REPORT 25–27 (detailing

oversight in the 111th and 112th Congresses). Congress has also repeatedly required the FCC to provide

information to enable Congress to review its activities.

For example, in the Infrastructure Investment and

Jobs Act of 2021, Congress directed the FCC to prepare a report on the future of universal service. Infrastructure Investment and Jobs Act, Pub. L. No. 11758, § 60104, 135 Stat. 429, 1205–06 (2021); see also,

e.g., Dep’ts of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act, 1998,

Pub. L. No. 105-119, § 623, 111 Stat. 2440, 2521–22

(1997) (requiring similar reporting to Congress).

Based on the information Congress collects at these

oversight hearings and through these other directives,

Congress can amend Section 254 as needed to ensure

compliance with its intent.

And Congress has repeatedly amended Section

254 since it was enacted, demonstrating that it can

step in when it wants. In 2016, for example, Congress

added skilled nursing facilities to the categories of

health care providers eligible to receive USF funds under the Rural Health Care program. See Frank R.

Lautenberg Chemical Safety for the 21st Century Act,

Pub. L. No. 114-182, § 202, 130 Stat. 448, 512 (2016)

(codified as amended at 47 U.S.C. § 254(h)(7)(B)).

More recently, Congress directed the FCC to promulgate regulations for E-Rate to cover equipment for remote learning during the COVID-19 pandemic.

American Rescue Plan Act of 2021, Pub. L. No. 117-2,

§ 7402, 135 Stat. 4, 109–10. Congress has also directed

the FCC to make uniform the methodology for collecting coverage data. Consolidated Appropriations Act,

2018, Pub. L. No. 115-141, § 505, 132 Stat. 348, 1094–

95. And Congress has directed the FCC to require internet safety policies by schools and libraries receiving

E-Rate support. Consolidated Appropriations—FY

2001, Pub. L. No. 106-554, § 1721, 114 Stat. 2763,

2763A-343–50 (2000) (codified as amended at 47

U.S.C. 254(h)).

The court below noted that some of these oversight mechanisms have uncovered overpayments or

the misuse of funds under the USF. See App. at 8a-9a.

For instance, in 2018, the FCC proposed a $63.5 million fine against American Broadband and Telecommunications Company, which at the time was the

largest ever proposed for violations of the Lifeline

rules, for repeated, systematic, and large-scale violations of the Lifeline rules, including seeking Lifeline

support for more than 12,000 deceased individuals.

American Broadband & Telecommunications Company, 33 FCC Rcd. 10308 (2018).

But to the extent the OIG or Congress identifies a

need for improvement in the implementation of the

1996 Act, the responsibility falls on Congress to address those issues. Even Respondents’ amici agree

that “Congress needs to be the one to act here.” States’

Cert. Amicus 2; see also id. at 4 (arguing that separation of powers requires that Congress “can[not] delegate to the Courts, or to any other tribunals … powers

which are strictly and exclusively legislative.” (quoting Wayman v. Southard, 23 U.S. 1, 42 (1825)). Thus,

to the extent there are any concerns about USAC or

the FCC’s implementation of the 1996 Act, separation

of powers principles dictate that Congress—not the

courts—should resolve those issues, as it has done

many times before.

Checks on and Challenges to USAC

and FCC Determinations.

Lastly, several mechanisms ensure that the USF

remains accountable to Congress and that USAC remains accountable to the FCC by allowing for challenges to both entities’ actions.

The FCC conducts meaningful review of USAC’s

actions. In 2023 alone, the FCC twice elected not to

adopt USAC’s projections when setting the quarterly

contribution factor. See, e.g., Proposed Fourth Quarter

2023 Universal Service Contribution Factor, 38 FCC

Rcd. 8362, 8362 (Sept. 13, 2023); Proposed Third

Quarter 2023 Universal Service Contribution Factor,

38 FCC Rcd. 5670, 5670 (June 14, 2023); Revised Second Quarter 2003 Universal Service Contribution Factor, 18 FCC Rcd. 5097, 5097 (Mar. 21, 2003). The FCC

has exercised this check before as well. See, e.g., First

Quarter 1998 Universal Service Contribution Factors

Revised and Approved, 12 FCC Rcd. 21881, 21886

(Dec. 16, 1997).

Specific rules and regulations also ensure that

USAC remains subordinate to the FCC and subject to

the FCC’s “authority and surveillance.” Sunshine Anthracite, 310 U.S. at 399. For instance, the FCC has

directed that if the 1996 Act or its implementing regulations “are unclear, or do not address a particular

situation, the Administrator [USAC] shall seek guidance from the Commission.” 47 C.F.R. § 54.702(c).

Further, any carrier that is allegedly aggrieved by

USAC’s actions may challenge those actions by seeking de novo review before the FCC. 47 C.F.R.

§ 54.719(b). And any decision that the FCC renders

from such a challenge is binding on USAC going forward. Consumers’ Research v. FCC, 88 F.4th 917, 928

(11th Cir. 2023).

Beyond that, as was done here, decisions issued

by the FCC may be scrutinized by the courts. 47 U.S.C.

§ 402 (appeals may be taken from decisions and orders

of the Commission). And through the Hobbs Act—Section 2342 of Title 28 of the U.S. Code—Congress

granted the courts of appeals exclusive jurisdiction “to

enjoin, set aside, suspend (in whole or in part), or to

determine the validity of all final orders of the [FCC]

made reviewable” by 47 U.S.C. § 402; see Sandwich

Isles Commc’ns, Inc. v. United States, 992 F.3d 1355,

1362 (Fed. Cir. 2021).

In short, there are multiple checks on the FCC

and USAC in their execution of Congress’ mandate to

provide universal service. The USF is a highly successful, state-and-federal partnership that the FCC has

operated pursuant to Congress’ direction and under

the supervision of Congress and the courts. It should

easily pass constitutional muster.

CONCLUSION

Amici respectfully request that the Court reverse

the lower court’s decision.

Respectfully submitted,

PHILIP J. WEISER

Attorney General

RUSSELL D. JOHNSON

Deputy Solicitor General

SHANNON STEVENSON

Solicitor General

Counsel of Record

JUDSON CARY

MICHEL SINGER NELSON

Senior Assistant

Attorneys General

Office of the Colorado

Attorney General

1300 Broadway

10th Floor

Denver, Colorado 80203

Shannon.Stevenson@coag.gov

(720) 508-6000

(counsel continues on next page)

DAYNA ZOLLE HAUSER

Assistant Solicitor

General

LANE TOWERY

SEAN ONWUALU

Assistant Attorney

General Fellows

KRIS MAYES

Attorney General

State of Arizona

2005 N. Central Ave.

Phoenix, AZ 85004

WILLIAM TONG

Attorney General

State of Connecticut

165 Capitol Ave.

Hartford, CT 06106

KATHLEEN JENNINGS

Attorney General

State of Delaware

820 N. French St.

Wilmington, DE 19801

BRIAN L. SCHWALB

Attorney General

District of Columbia

400 6th St., NW., Ste. 8100

Washington, D.C. 20001

ANNE E. LOPEZ

Attorney General

State of Hawai‘i

425 Queen St.

Honolulu, HI 96813

KWAME RAOUL

Attorney General

State of Illinois

500 S. 2nd St.

Springfield, IL 62701

AARON M. FREY

Attorney General

State of Maine

6 State House Station

Augusta, ME 04333

WILLIAM S. HARWOOD

Public Advocate

State of Maine

103 Water St., 3 Fl.

Hallowell, ME 04347

ANTHONY G. BROWN

Attorney General

State of Maryland

200 Saint Paul Place

Baltimore, MD 21202

ANDREA JOY CAMPBELL

Attorney General

Commonwealth of

Massachusetts

One Ashburton Place

Boston, MA 02108

DANA NESSEL

Attorney General

State of Michigan

P.O. Box 30212

Lansing, MI 48909

KEITH ELLISON

Attorney General

State of Minnesota

102 State Capitol

75 Rev. Dr. Martin Luther

King Jr. Blvd.

St. Paul, MN 55155

AARON D. FORD

Attorney General

State of Nevada

100 N. Carson St.

Carson City, NV 89701

MATTHEW J. PLATKIN

Attorney General

State of New Jersey

25 Market St., 8th Fl.

Trenton, NJ 08625

LETITIA A. JAMES

Attorney General

State of New York

28 Liberty St.

New York, NY 10005

JEFF JACKSON

Attorney General

State of North Carolina

114 W. Edenton St.

Raleigh, NC 27603

MICHELLE A. HENRY

Attorney General

Commonwealth of Pennsylvania

Strawberry Sq., 16 Fl.

Harrisburg, PA 17120

PETER F. NERONHA

Attorney General

State of Rhode Island

150 S. Main St.

Providence, RI 02903

MARTY JACKLEY

Attorney General

State of South Dakota

1302 E. Hwy. 14, Ste. 1

Pierre, SD 57501

CHARITY R. CLARK

Attorney General

State of Vermont

109 State St.

Montpelier, VT 05609

JOSH KAUL

Attorney General

State of Wisconsin

P.O. Box 7857

Madison, WI 53707

January 16, 2025

BRIDGET HILL

Attorney General

State of Wyoming

200 W. 24th St.

Cheyenne, WY 82002

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.