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

Supreme Court briefFeb 18, 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 Writs of Certiorari to the

United States Court of Appeals for the Fifth Circuit

__________

BRIEF OF THE CATO INSTITUTE AND

MANHATTAN INSTITUTE AS AMICI CURIAE

IN SUPPORT OF RESPONDENTS

__________

Ilya Shapiro

Tim Rosenberger

MANHATTAN INSTITUTE

52 Vanderbilt Ave.

New York, NY 10017

February 18, 2025

Thomas Berry

Counsel of Record

Brent Skorup

Charles M. Brandt

CATO INSTITUTE

1000 Mass. Ave., N.W.

Washington, DC 20001

(443) 254-6330

tberry@cato.org

QUESTIONS PRESENTED

1. Whether 47 U.S.C. § 254 violates the

nondelegation doctrine by imposing no limit on the

FCC’s power to raise revenue for the USF.

2. Whether the FCC violated the nondelegation

doctrine by transferring its revenue-raising powers to

a private company run by industry groups.

3. Whether the combination of Congress’s

delegation to the FCC and the FCC’s delegation to the

private Universal Service Administrative Company

violates the nondelegation doctrine.

TABLE OF CONTENTS

QUESTIONS PRESENTED ......................................... i

TABLE OF CONTENTS.............................................. ii

TABLE OF AUTHORITIES ....................................... iv

INTEREST OF AMICI CURIAE ................................. 1

INTRODUCTION

AND SUMMARY OF ARGUMENT ........................... 2

ARGUMENT ................................................................ 6

I. SECTION

254

VIOLATES

THE

NONDELEGATION DOCTRINE. .................. 6

A. CONGRESS CANNOT

DELEGATE ITS TAXING POWER. .......... 6

B. SECTION 254 IMPERMISSIBLY

DELEGATES CONGRESS’S

TAXING POWER TO THE FCC. ............... 8

II. THE COURT SHOULD CLARIFY OR

REPLACE

THE

INTELLIGIBLE

PRINCIPLE TEST TO PROTECT THE

SEPARATION OF POWERS......................... 12

III.THE COURT SHOULD CLARIFY THAT

THE MAJOR QUESTIONS DOCTRINE

IS NOT A SUBSTITUTE FOR THE

NONDELEGATION DOCTRINE. ................ 15

iii

IV. THE FCC VIOLATED THE PRIVATE

NONDELEGATION

DOCTRINE

TRANSFERRING

ITS

REVENUERAISING POWERS TO USAC. ..................... 16

A. CONGRESS HISTORICALLY

DELEGATED ONLY

MINISTERIAL TASKS TO

PRIVATE ACTORS. ................................. 19

B. USAC FALLS FAR OUTSIDE THE

HISTORICAL TRADITION OF

PRIVATE DELEGATIONS. ..................... 22

CONCLUSION .......................................................... 23

TABLE OF AUTHORITIES

Cases

ALA Schechter Poultry Corp. v. United States,

295 U.S. 495 (1935) ................................................ 10

Alenco Commc’ns, Inc. v. FCC, 201 F.3d 608

(5th Cir. 2000) .................................................. 10, 11

Bowsher v. Synar, 478 U.S. 714 (1986) ..................... 19

Carter v. Carter Coal Co., 298 U.S. 238 (1936)......... 17

Dorman v. Dell, 245 Ky. 34 (1934) ............................ 17

Doty v. Love, 295 U.S. 64 (1935) ................................ 17

Grant v. Raymond, 31 U.S. (6 Pet.) 218 (1832) ........ 22

Gundy v. United States, 588 U.S. 128 (2019) ....... 4, 14

Hoff v. First State Bank, 174 Minn. 36 (1928) .......... 17

Marbury v. Madison, 5 U.S. (1 Cranch) 137

(1803) ...................................................................... 19

McConville v. Ft. Pierce Bank & Trust Co.,

101 Fla. 727 (1931) ................................................. 17

McCulloch v. Maryland, 17 U.S. (4 Wheat.)

316 (1819) ................................................................. 7

Milner v. Gibson, 249 Ky. 594 (1933) ........................ 17

Mistretta v. United States, 488 U.S. 361

(1989) ............................................................ 5, 19, 23

Moore v. United States, 602 U.S. 572 (2024) .............. 7

Nagel v. Ghingher, 166 Md. 231 (1934) .................... 17

Nat’l Fed’n of Indep. Bus. v. OSHA, 595 U.S.

109 (2022) ............................................................... 16

Patents for Inventions, 1 Op. Att’y Gen. 170

(1812) ...................................................................... 22

Patents, Patent Office, and Clerks, 2 Op. Att’y

Gen. 454 (1831) ...................................................... 22

Red Lion Broad. Co. v. FCC, 395 U.S. 367

(1969) ........................................................................ 2

Skinner v. Mid-Am. Pipeline Co., 490 U.S. 212

(1989) ........................................................................ 6

Sunshine Anthracite Coal Co. v. Adkins, 310

U.S. 381 (1940) ................................................. 17, 18

Trump v. Anderson, 601 U.S. 100 (2024) .................. 19

United States v. AT&T, 552 F. Supp. 131

(D.D.C. 1982) ............................................................ 3

West Virginia v. EPA, 597 U.S. 697 (2022) ......... 15, 16

Whitman v. Am. Trucking Ass’ns, 531 U.S.

457 (2001) ......................................................... 13, 14

Statutes

47 U.S.C. § 154........................................................... 19

47 U.S.C. § 160............................................................. 2

47 U.S.C. § 254......................................... 2, 4, 9, 10, 12

Telecommunications Act of 1996, Pub. L. 104104, 110 Stat. 56 (Feb. 8, 1996) ............................... 4

Other Authorities

Barbara A. Cherry & Donald D. Nystrom,

Universal Service Contributions: An

Unconstitutional Delegation of Taxing

Power, 2000 MICH. ST. L. REV. 107 (2000) ... 9, 12, 14

Brent Skorup & Michael Kotrous, The FCC’s

High-Cost Programs, Rural Broadband

Penetration & Rural Broadband Service

Quality (Dec. 14, 2020)........................................... 11

Brief for the United States as Amicus Curiae

Supporting Respondent, Wisconsin Bell,

Inc. v. United States ex rel. Todd Heath

(No. 23-1127) (Oct. 2024) ....................................... 15

Considering the Role of Judges Under the

Constitution of the United States, U.S.

SENATE COMM. ON THE JUDICIARY (Oct. 5,

2011) ....................................................................... 12

David Post, Can a federal agency declare

“regulatory bankruptcy”?, WASH. POST:

VOLOKH CONSPIRACY (Oct. 2, 2014) ......................... 2

Federal Receipts as Percent of Gross Domestic

Product, FED. RESERVE ECON. DATA (Jan.

30, 2025) ................................................................... 9

Jennifer Mascott, Private Delegation Outside

of Executive Supervision, 45 HARV. L. REV.

837 (2022) ....................................... 18, 20, 21, 22, 23

Karen Barkey & George Gavrilis, The

Ottoman Millet System: Non-Territorial

Autonomy and its Contemporary Legacy,

15 ETHNOPOLITICS 24 (2016) .................................. 18

Mark Chenoweth & Richard Samp,

Reinvigorating Nondelegation with Core

Legislative Power, in THE ADMINISTRATIVE

STATE BEFORE THE SUPREME COURT:

PERSPECTIVES ON THE NONDELEGATION

DOCTRINE (Peter J. Wallison & John Yoo

eds., 2022) ....................................................... 7, 8, 14

vii

MILTON L. MUELLER, JR., UNIVERSAL SERVICE:

COMPETITION, INTERCONNECTION, AND

MONOPOLY IN THE MAKING OF THE

AMERICAN TELEPHONE SYSTEM (MIT Press

1997) ......................................................................... 3

Nathan S. Chapman & Michael W.

McConnell, Due Process as Separation of

Powers, 121 YALE L.J. 1672 (2012) ........................ 17

OFF. OF MGMT. & BUDGET, EXEC. OFF. OF THE

PRESIDENT, OPINION LETTER ON THE STATUS

OF THE UNIVERSAL SERVICE FUND (2000)............... 15

Paul C. Light, The true size of government is

nearing a record high, BROOKINGS INST.

(Oct. 7, 2020) .......................................................... 14

Paul J. Larkin, The Private Delegation

Doctrine, 73 FLA. L. REV. 31 (2021) ....................... 17

Ronald J. Krotoszynski, Jr., Reconsidering the

Nondelegation Doctrine: Universal Service,

the Power to Tax, and the Ratification

Doctrine, 80 IND. L.J. 239 (2005) ............................. 6

THE FEDERALIST NO. 48 (James Madison)

(Royal Classics ed. 2020) ......................................... 9

THE FEDERALIST NO. 51 (James Madison)

(Royal Classics ed. 2020) ......................................... 5

THE FEDERALIST NO. 56 (James Madison)

(Royal Classics ed. 2020) ......................................... 7

THE FEDERALIST NO. 57 (James Madison)

(Royal Classics ed. 2020) ......................................... 7

THE FEDERALIST NO. 78 (Alexander Hamilton)

(Royal Classics ed. 2020) ....................................... 13

viii

THOMAS PAINE, COMMON SENSE (Richard

Beerman ed.) (1776) ............................................. 5, 6

Todd Gaziano & Ethan Blevins, The

Nondelegation Test Hiding in Plain Sight:

The Void-for-Vagueness Standard Gets the

Job Done, in THE ADMINISTRATIVE STATE

BEFORE THE SUPREME COURT: PERSPECTIVES

ON THE NONDELEGATION DOCTRINE (Peter J.

Wallison & John Yoo eds., 2022) ..................... 14, 16

U.S. CONST., art I, § 9, cl. 4.......................................... 7

U.S. GOV’T ACCOUNTABILITY OFF., GAO-05151, GREATER INVOLVEMENT NEEDED BY

FCC IN THE MANAGEMENT AND OVERSIGHT

OF THE E-RATE PROGRAM (2005) ............................ 10

U.S. GOV’T ACCOUNTABILITY OFF., GAO-24106967, ADMINISTRATION OF UNIVERSAL

SERVICE PROGRAMS IS CONSISTENT WITH

SELECTED FCC REQUIREMENTS (2024)............. 3, 4, 9

Western Alliance, Comment, In re FederalState Joint Board on Universal Service,

12 FCC Rcd 8776 (1997) (Dec. 19, 1996) ............... 11

Regulations

47 C.F.R. § 54.709(a)(3) ............................................. 19

Constitutional Provisions

U.S. CONST., art I, § 1, cl. 1.......................................... 6

U.S. CONST., art I, § 7, cl. 1.......................................... 7

U.S. CONST., art I, § 8, cl. 1...................................... 5, 7

INTEREST OF AMICI CURIAE1

The Cato Institute is a nonpartisan public policy

research foundation founded in 1977 and dedicated to

advancing the principles of individual liberty, free

markets, and limited government. Cato’s Robert A.

Levy Center for Constitutional Studies was

established in 1989 to promote the principles of limited

constitutional government that are the foundation of

liberty. Toward those ends, Cato publishes books and

studies, conducts conferences, produces the annual

Cato Supreme Court Review, and files amicus briefs.

The Manhattan Institute for Policy Research (MI)

is a nonpartisan public policy research foundation

whose mission is to develop and disseminate ideas that

foster greater economic choice and individual

responsibility. To that end, MI’s constitutional studies

program aims to preserve the Constitution’s original

public meaning, including with regard to the

separation of powers.

This case interests amici because Congress has

delegated legislative power to the Federal

Communications Commission (FCC) and private

parties in violation of Article I.

1 Rule 37 statement: No part of this brief was authored by any

party’s counsel, and no person or entity other than amici funded

its preparation or submission.

INTRODUCTION AND SUMMARY OF

ARGUMENT

The FCC’s powers are the result of several strange,

Constitution-distorting, legislative experiments. The

FCC has a free hand, for instance, to punish media

companies when they refuse to distribute the content

the agency deems worthwhile.2 And Congress has

empowered the FCC to unilaterally render entire

statutes inoperative.3 But perhaps the most

objectionable experiment is the one at issue here—the

“universal service” subsidy program. See 47 U.S.C.

§ 254.

This uncapped congressional appropriation has

many of the hallmarks of a tax. The Government

collects a fixed percentage of telecommunications

companies’ long-distance service revenues, deposits

the money in the U.S. Treasury, and spends the funds

2 See, e.g., Red Lion Broad. Co. v. FCC, 395 U.S. 367 (1969). The

radio station in Red Lion aired a segment by a conservative pastor

criticizing a journalist and his anti–Barry Goldwater book. The

FCC required the station to provide the journalist free airtime to

respond to the criticisms. The Supreme Court rejected the station

operator’s free speech claims, holding that the power to mandate

radio messages was not “beyond the scope of the congressionally

conferred power to assure that stations are operated by those

whose possession of a license serves ‘the public interest.’” Id. at

386.

3 See 47 U.S.C. § 160. As Professor David Post wondered, “[I]s this

provision constitutional? It requires (‘the Commission shall . . .’)

the FCC to refrain from enforcing statutory provisions when it

determines that it is not consistent with the public interest to do

so. . . . Hard for me to believe that can pass constitutional muster;

it’s like a repeal process, but one not involving Congressional

action.” David Post, Can a federal agency declare “regulatory

bankruptcy”?, WASH. POST: VOLOKH CONSPIRACY (Oct. 2, 2014),

https://tinyurl.com/bdh7duvy.

on a public welfare program. Yet, because the FCC

outsources revenue collection and disbursement to a

nominally private company, the government

designates the tax, euphemistically, as a regulatory

“fee.” The government collects around $8 billion of

these “fees” annually,4 which are often buried as a line

item in Americans’ monthly wireless and home phone

bills. After 200 years, the government has purportedly

discovered a novel scheme—available all this time—to

raise and spend funds outside the strictures of

Article I.

This circuitous subsidy system was designed by

government and industry technocrats to run virtually

on autopilot since it was initiated in 1996. It is the

successor to an earlier system from a much different

era, when AT&T was the nation’s telephone

monopolist. Beginning in the 1950s, federal and state

regulators had compelled AT&T to use its longdistance service revenues to keep Americans’ phone

bills artificially low.5 But in the 1980s and 90s, the

U.S. Department of Justice imposed a network

breakup, ending this monopoly and making the

corporatist system of internal cross-subsidies

impossible. See United States v. AT&T, 552 F. Supp.

131, 226–28 (D.D.C. 1982).

See, e.g., U.S. GOV’T ACCOUNTABILITY OFF., GAO-24-106967,

ADMINISTRATION OF UNIVERSAL SERVICE PROGRAMS IS

CONSISTENT WITH SELECTED FCC REQUIREMENTS 2 (2024)

(hereinafter “2024 GAO REPORT”).

See MILTON L. MUELLER, JR., UNIVERSAL SERVICE:

COMPETITION, INTERCONNECTION, AND MONOPOLY IN THE MAKING

OF THE AMERICAN TELEPHONE SYSTEM 159–62 (MIT Press 1997).

Congress responded to this new reality in the 1996

Telecommunications Act.6 The Act required the FCC

to create a system of “universal service” subsidies to

compensate telecom and tech companies for serving

favored constituencies, including rural households,

schools, and libraries. See 47 U.S.C. § 254.

Both Congress’s creation and the FCC’s

implementation of the universal service fund (Fund)

have odd and novel characteristics. Congress’s

guidance to the FCC is skeletal and open-ended. For

example, the FCC must subsidize an “evolving” level

of technology services, and the FCC must consider six

vague “principles” (and add others it deems worthy)

when determining how much universal service

“support” to collect. See id.

The FCC further attenuated Americans’ control of

the scheme when it delegated Fund collection and

spending responsibilities solely to a private nonprofit

it created: the Universal Service Administration

Company (USAC). The USAC Board comprises 20

members who are, predominantly, current and retired

employees of telecommunications firms and Fund

recipients. See 2024 GAO REPORT, supra, at 6. Safely

shielded from accountability to the electorate, USAC

quietly exacts billions of dollars annually from

Americans’ phone bills to disburse among eligible

telecom firms.

One of the core aims of the Constitution is to make

government officials accountable. See Gundy v. United

States, 588 U.S. 128, 155 (2019) (Gorsuch, J.,

dissenting) (“[T]he Constitution sought to ensure that

6 Telecommunications Act of 1996, Pub. L. 104-104, 110 Stat. 56

(Feb. 8, 1996).

the lines of accountability would be clear: The

sovereign people would know, without ambiguity,

whom to hold accountable for the laws they would have

to follow.”). As Thomas Paine remarked, “the

constitution of England [was] so exceedingly complex,

that the nation may suffer for years together without

being able to discover in which part the fault lies.”

THOMAS PAINE, COMMON SENSE 12 (Richard Beerman

ed.) (1776). The Framers therefore designed three

branches of government, each with distinct powers,

responsibilities, and ambitions. See THE FEDERALIST

NO. 51, at 302 (James Madison) (Royal Classics ed.

2020). This separation of powers thus prevents both

overreach

and

abdication.

Congress

cannot

“unconstitutionally diminish [its own] authority” any

more than it can intrude upon the province of the

courts or the President. Mistretta v. United States, 488

U.S. 361, 395 (1989).

In the present case, Congress has attempted to

outsource some of its most important Article I powers:

the powers to tax and spend. U.S. CONST., art I, § 8,

cl. 1. Instead of taxing the revenues of carriers directly

and apportioning funds for universal-service

subsidies, Congress instead created an accountabilityshrouding system of taxes and subsidies operated by

the FCC, which in turn subdelegated that

responsibility to an unaccountable and selfperpetuating private entity, of which the statute

“makes no mention.” Pet. App. 59a.

Consumers’ Research contested a recent USAC

imposition (and the FCC’s nominal consideration) of

these monthly exactions. After the FCC persisted in

taxing phone lines, Consumers’ Research sued in the

Fifth Circuit Court of Appeals. On rehearing en banc,

the court held that this scheme violates Article I’s

Legislative Vesting Clause. U.S. CONST., art I, § 1,

cl. 1; Pet. App. 64a–81a. Because the scheme violates

both the nondelegation and private nondelegation

doctrines, this Court should affirm the decision below.

ARGUMENT

SECTION 254 VIOLATES THE NONDELEGATION

DOCTRINE.

The required financial “support” in Section 254 has

the hallmarks of a tax. The FCC demands a specific

percentage of phone companies’ revenue, which USAC

and the FCC remit to the Treasury. Such “support”

cannot be fairly characterized as a “fee” because a fee

is when a “charge” corresponds to “a benefit

voluntarily sought by the payer.” Pet. App. 21a

(quoting Ronald J. Krotoszynski, Jr., Reconsidering

the Nondelegation Doctrine: Universal Service, the

Power to Tax, and the Ratification Doctrine, 80 IND.

L.J. 239, 270 (2005)). This “support,” rather, is a tax

because it “inure[s] to the benefit of the public.”

Skinner v. Mid-Am. Pipeline Co., 490 U.S. 212, 223

(1989). Section 254, therefore, impermissibly delegates

Congress’s taxing power to the FCC.

A. CONGRESS CANNOT DELEGATE ITS

TAXING POWER.

With the oppressions of a distant and unfamiliar

legislature fresh in mind,7 the Framers recognized

taxation as a legislative object “of most importance,

and which seems most to require local knowledge.”

7 See PAINE, supra, at 43 (“[A] power, so distant from us, and so

very ignorant of us . . . cannot govern us[.]”).

THE FEDERALIST NO. 56, at 328 (James Madison)

(Royal Classics ed. 2020). Article I thus grants the

people’s elected representatives in Congress the

exclusive “power to lay and collect taxes.” U.S. CONST.,

art I, § 8, cl. 1.

The Framers also knew that “the power to tax

involves the power to destroy.” McCulloch v.

Maryland, 17 U.S. (4 Wheat.) 316, 431 (1819).

“Because of its breadth, the taxing power can be highly

dangerous if abused.” Mark Chenoweth & Richard

Samp, Reinvigorating Nondelegation with Core

Legislative Power, in THE ADMINISTRATIVE STATE

BEFORE THE SUPREME COURT: PERSPECTIVES ON THE

NONDELEGATION DOCTRINE 98 (Peter J. Wallison &

John Yoo eds., 2022). For this reason, the Framers

enshrined special safeguards against unaccountable—

and hence, excessive—taxation. First, they required

revenue bills to originate in the House of

Representatives. U.S. CONST., art I, § 7, cl. 1. The

House was chosen for this role because it was the

chamber of Congress “so constituted as to support in

[its] members an habitual recollection of their

dependence on the people.” THE FEDERALIST NO. 57, at

334 (James Madison) (Royal Classics ed. 2020).

Second, the Framers imposed a limit on direct taxes by

requiring that they be apportioned among the States

on the basis of population. See U.S. CONST., art I, § 9,

cl. 4; see also Moore v. United States, 602 U.S. 572, 582

(2024).

These special limits on federal taxation “would be

bypassed” if Congress could simply pass the taxingand-spending baton to administrative agencies or

private companies like USAC. Chenoweth & Samp,

supra, at 98–99. “The dangers thereby created are

such that careful judicial review . . . is warranted.” Id.

at 99.

The court below correctly ruled that Section 254

violates Article I. Holding otherwise would have

created a constitutional “cheat code”—Congress would

no longer need to impose unpopular taxes and could

instead simply command favored industries and their

captured regulators to fund welfare programs. For

example, Congress could pass the unenviable task of

raising revenues for Medicare and Medicaid to

hospital executives. Pet. App. 22a. It could empower a

consortium of grocers to set the Supplemental

Nutrition Assistance Program (“SNAP”) budget only

for shoppers to foot the bill at checkout. Id. It could

even empower Lockheed Martin to set the defense

budget at whatever it “wants it to be, unless Congress

intervenes to revise it.” Id. at 49a.

Each

these

hypotheticals

would

unconstitutional for the same reason as the scheme at

issue here. Congress must make difficult policy

decisions about taxation for itself and thereby incur

the people’s judgment. Accountability to voters for

imposing taxation may be unwelcome, but Article I

requires it.

B. SECTION 254 IMPERMISSIBLY DELEGATES

CONGRESS’S TAXING POWER TO THE FCC.

With Section 254, Congress has attempted to evade

the strictures of Article I by delegating its taxing and

spending powers to the FCC. The law “delegate[d] the

definition, execution, and financing of [a massive

entitlement program] to the FCC.” Barbara A. Cherry

Donald

Nystrom,

Universal

Service

Contributions: An Unconstitutional Delegation of

Taxing Power, 2000 MICH. ST. L. REV. 107, 110 (2000).

In the words of the Government Accountability Office,

“Congress authorized the [Fund] as a permanent,

indefinite appropriation.” 2024 GAO REPORT, supra, at

7 (citing 47 U.S.C. § 254). This “appropriation” is for

“an unspecified amount” and “remain[s] available

without further congressional action.” Id.

Ultimately, the FCC wields “unfettered power . . .

in defining the scope of universal service” with “no

limits” on how much of a financial “burden” it may

impose to fund it. Cherry & Nystrom, supra, at 110.

Congress thus replaced the accountable taxation

contemplated by the Framers with a series of

“complicated and indirect measures” that disguise its

“encroachments” on the people. THE FEDERALIST NO.

48, at 289 (James Madison) (Royal Classics ed. 2020).

Article I does not permit “[t]his congressional

obfuscation of the duty to lay taxes.” Cherry &

Nystrom, supra, at 110.

Section 254 contains no “formula, ceiling, or other

meaningful restrictions on how much money can be

raised” from American consumers. Resp. Br. 3. This

broad delegation from Congress, combined with the

FCC’s dubious delegation of operational control to

USAC, likely explains why the Fund exploded in cost

from $1.37 billion in 1995 to $9 billion in 2021. Pet.

App. 8a.8 While the people’s elected representatives

are reluctant to raise taxes, USAC—a private

This nearly seven-fold increase in the USF overwhelmingly

outpaced the growth of federal receipts as a share of gross

domestic product over the same period, which decreased by 0.6%.

See Federal Receipts as Percent of Gross Domestic Product, FED.

RESERVE

ECON.

DATA

(Jan.

30,

2025),

https://tinyurl.com/2tm2twbe.

nonprofit shielded from electoral accountability—has

fewer reservations.

The government responds that Congress has not

delegated its powers of the purse to the FCC (or USAC)

because the agency must “base policies for the

preservation and advancement of universal service” on

specific “principles.” 47 U.S.C. § 254(b)(1)–(6); Gov.

Pet. Br. at 30. That is wrong for two reasons.

First, those “principles” are aspirational and

standardless. The FCC is expressly empowered to

introduce “other principles” that are “necessary and

appropriate for the protection of the public interest,”

47 U.S.C. § 254(b)(7). As one government report put it,

the statute “neither specified how the FCC was to

administer universal service . . . nor prescribed the

structure and legal parameters of the universal service

mechanisms

created.”

U.S.

GOV’T

ACCOUNTABILITY

OFF.,

GAO-05-151,

GREATER

INVOLVEMENT NEEDED BY FCC IN THE MANAGEMENT

AND OVERSIGHT OF THE E-RATE PROGRAM 12 (2005).

The law empowers the agency to “roam at will” in

disregard of the statute’s stated principles. ALA

Schechter Poultry Corp. v. United States, 295 U.S. 495,

538 (1935); Pet. App. 28a–29a.

Second, the FCC is not meaningfully constrained

by the requirement that the “other principles” it

introduces must be “consistent with the Act.” 47 U.S.C.

§ 254(b)(7). As noted, the principles laid out in the Act

are “contentless” and “aspirational.” Pet. App. 29a.

One court has even suggested that the FCC may ignore

one principle to satisfy another. Alenco Commc’ns, Inc.

v. FCC, 201 F.3d 608, 621 (5th Cir. 2000). Given the

lack of guidance in the statute, the FCC may divine

similarly vague and aspirational principles that

expand the statute beyond the contemplation of its

drafters,9 only to ignore these new principles in the

“exercise [of its] reasoned discretion.” Alenco, 201 F.3d

at 621.

The permissiveness of Congress’s delegation is

further indicated by the fact that the Fund’s exactions

have risen considerably, contrary to the expectations

of the statute’s drafters and the accountants at the

Congressional Budget Office, who expected the Fund

to shrink in cost over time.10

“[T]he only real constraint on the FCC’s discretion

to levy excise taxes on telecommunications carriers

(and American consumers in turn) is that rates

‘should’ remain ‘affordable.’” Pet. App. 30a (quoting 47

9 And so it has. As the government points out, “the FCC has added

two principles” to the original six, one of which is “that universal

service funding should be ‘competitively neutral.’” Gov. Pet. Br.

32. When the agency proposed adding this “extra principle,” a

commenter argued, plausibly, that it was “wholly inconsistent

with the language of Section 254(b),” to incorporate “competitive

neutrality” because that term was omitted in subsection (b) yet

included in subsection (h). Western Alliance, Comment at 10–11,

In re Federal-State Joint Board on Universal Service, 12 FCC Rcd

8776 (1997) (Dec. 19, 1996), https://tinyurl.com/4yxpjm7y. While

“the statute demonstrates a conscious decision by Congress not to

include ‘competitive neutrality’ as a basic or rural universal

service principle,” id., the agency nonetheless added it under its

§ 254(b)(7) powers.

“Senator Ted Stevens, in fact, noted during debate on the

Telecommunications Act that CBO estimated that the cost of

providing universal service would decline by billions of dollars

after passage of the act. These anticipated subsidy reductions

never occurred.” Brent Skorup & Michael Kotrous, The FCC’s

High-Cost Programs, Rural Broadband Penetration & Rural

Broadband Service Quality, at 4 & nn.13–14 (Dec. 14, 2020)

(emphasis added), https://tinyurl.com/4xw3sn55.

U.S.C. § 254(b)(1)). But even determining what is

“affordable” is illusory. “There are no answers because

Congress never gave them.” Id. at 31a. Further, the

taxed services here are “uncommonly inelastic”—

consumer purchases change little in response to price

changes—because phone and broadband services are

“essential to participation in the modern world.” Id. at

30a, 31a. The FCC and USAC “could impose eyewatering USF Taxes” and still see relatively few

Americans give up their smartphones. Pet. App. 31a.

The “affordability constraint” thus “amounts to no

guidance whatsoever.” Id. at 30a (internal quotation

marks omitted).

Section 254 represents an entitlement funded by

taxes, set to autopilot. Congressmen can “hide behind

a thin veil of ignorance as they scratch their heads

wondering how universal service became such a costly

entitlement program.” Cherry & Nystrom, supra, at

108–09. This is not the accountable Congress

contemplated by the Framers and mandated by

Article I.

II. THE COURT SHOULD CLARIFY OR

REPLACE THE INTELLIGIBLE PRINCIPLE

TEST TO PROTECT THE SEPARATION OF

POWERS.

Justice Scalia once remarked that “[t]he real key

to the distinctiveness of America is the structure of our

government.” Considering the Role of Judges Under

the Constitution of the United States, U.S. SENATE

COMM. ON THE JUDICIARY, at 00:40:21 (Oct. 5, 2011).11

That distinct structure will be maintained only if this

Court is willing to police and demarcate the

11 Available at https://tinyurl.com/2k3u2m3v.

boundaries which

executive powers.

separate

the

legislative

and

The Framers envisioned the federal courts as “the

bulwarks of a limited Constitution against legislative

encroachments” and “an intermediate body between

the people and the legislature.” THE FEDERALIST NO.

78, at 451, 452 (Alexander Hamilton) (Royal Classics

ed. 2020). Consistent with that mission, this Court has

a proud tradition of judicial engagement. Historically,

when

government

conduct

has

implicated

fundamental constitutional rights, this Court has

vigorously scrutinized those impingements to ensure

that the political branches comport with constitutional

commands.12

When it comes to delegation, however, the Court

over the last 90 years has taken a too-lax approach. So

long as a statute contains a mere “intelligible

principle” to guide executive action, the Court has

refused to second-guess Congress “regarding the

permissible degree of policy judgment that can be left

to those executing or applying the law.” Whitman v.

Am. Trucking Ass’ns, 531 U.S. 457, 474–75 (2001)

(internal quotation marks omitted).

Unfortunately, courts’ deferential interpretations

of the intelligible principle test have permitted the

Executive Branch to aggrandize itself at Congress’s

expense, usurping Congress’s role as the predominant

policymaking branch. The result is a multi-millionman bureaucracy, an Executive Branch of record size.

See, e.g., Texas v. Johnson, 491 U.S. 397, 412 (1989) (First

Amendment); Musser v. Utah, 333 U.S. 95, 97 (1948) (Fifth

Amendment); District of Columbia v. Heller, 554 U.S. 570, 635

(2008) (Second Amendment).

See Paul C. Light, The true size of government is

nearing a record high, BROOKINGS INST. (Oct. 7,

2020).13 This case offers the Court a chance to begin

correcting that imbalance in the separation of powers.

To the extent that the intelligible principle test

applies here, the Court should apply a robust form of

the test that protects the separation of powers. See

Gundy v. United States, 588 U.S. 128, 164, 166 (2019)

(Gorsuch, J., dissenting) (proposing a three-pronged

inquiry based on “prior teachings”); see generally Todd

Gaziano & Ethan Blevins, The Nondelegation Test

Hiding in Plain Sight: The Void-for-Vagueness

Standard Gets the Job Done, in THE ADMINISTRATIVE

STATE BEFORE THE SUPREME COURT: PERSPECTIVES ON

THE NONDELEGATION DOCTRINE 45–70 (Peter J.

Wallison & John Yoo eds., 2022); Chenoweth & Samp,

supra. Certain decisions are “simply too great for

[them] to be called anything other than legislative.”

Whitman, 531 U.S. at 487 (Thomas, J., concurring)

(internal quotation marks omitted). This is one such

case.

Under any meaningful nondelegation test, the

statute at issue in this case should not pass muster. In

enacting Section 254, Congress did not “determine

what [was] to be funded and at what cost.” Cherry &

Nystrom, supra, at 123. Instead, Congress “require[d]

the FCC to define universal service,” “quantify the

respective net costs to be recovered,” and “determine

how” to recover them “from carriers’ customers.” Id. at

123–24. Plainly, Congress left the difficult work of

legislating to the FCC, which then subdelegated that

13 Available at https://tinyurl.com/2ub68684.

work to USAC—a private entity of which “Section 254

. . . makes no mention.” Pet. App. 59a.

While the statute provides a skeletal framework of

policy goals to guide the agency’s operations, these

goals do not meaningfully constrain its discretion to

extract revenue from American consumers in

whatever amounts it might desire. Id. at 69a–70a.

Indeed, the statute leaves so much undefined that

government agencies have not even held a consistent

view as to whether money in the Fund belongs to the

government.14 This is the case—and the statute—to

give the nondelegation doctrine teeth again.

III. THE COURT SHOULD CLARIFY THAT THE

MAJOR QUESTIONS DOCTRINE IS NOT A

SUBSTITUTE FOR THE NONDELEGATION

DOCTRINE.

If Congress wishes to vest in the Executive Branch

domestic policy “decisions of vast economic and

political significance,” it must “speak clearly.” West

Virginia v. EPA, 597 U.S. 697, 716 (2022) (internal

quotation marks omitted). Accordingly, “[s]ome have

described [this major questions] doctrine as a

Compare OFF. OF MGMT. & BUDGET, EXEC. OFF. OF THE

PRESIDENT, OPINION LETTER ON THE STATUS OF THE UNIVERSAL

SERVICE FUND 3 (2000), bit.ly/49udXwN (concluding that “the

Universal Service Fund does not constitute public money

pursuant to the Miscellaneous Receipts Statute . . ., and is

appropriately maintained outside the Treasury by a nongovernmental manager”), with Brief for the United States as

Amicus Curiae Supporting Respondent at 8, Wisconsin Bell, Inc.

v. United States ex rel. Todd Heath (No. 23-1127) (Oct. 2024)

(“[M]oney held in the Fund does belong to the government.

Congress has appropriated money from the Fund; the President

accounts for it in his annual budget; and the Commission

accounts for it in its financial statements.”) (emphasis added).

substitute for nondelegation policing.” Gaziano &

Blevins, supra, at 48 n.15.

While the rise of the major questions doctrine is a

welcome development, it cannot serve as a sufficient

substitute

for

the

nondelegation

doctrine.

Nondelegation and major questions are “closely

related” because each doctrine aims “to prevent

government by bureaucracy supplanting government

by the people.” Nat’l Fed’n of Indep. Bus. v. OSHA, 595

U.S. 109, 124, 125 (2022) (Gorsuch, J., concurring)

(internal quotation marks omitted). However, the

doctrines perform different jobs. See Gaziano &

Blevins, supra, at 48 n.15. As an interpretative

presumption, the major questions doctrine limits only

how Congress must make particularly large

delegations to the Executive; it leaves unrestrained

Congress’s power to offload vast amounts of legislative

authority in the first place. Cf. id.

As the Fifth Circuit correctly concluded, Section

254 “delegated to FCC the power to decide how much

revenue the Government will raise [from American

taxpayers] via USF taxes.” Pet. App. 69a. Congress

cannot do so regardless of how “clearly” it “speak[s].”

West Virginia, 597 U.S. at 716. This Court should

likewise make clear that the development of the major

questions doctrine has not obviated courts’ need to

apply the nondelegation doctrine.

IV. THE FCC VIOLATED THE PRIVATE

NONDELEGATION

DOCTRINE

TRANSFERRING ITS REVENUE-RAISING

POWERS TO USAC.

The private nondelegation doctrine prevents the

government from vesting sovereign power in those

who are not part of the government. One important

purpose served by the private nondelegation doctrine

is that it prevents the government from using private

parties to do what the government legally could not do.

As a component of both due process of law and

separation of powers, the doctrine confines private

actors to advisory or subordinate functions, under the

“pervasive oversight and authority” of government.

Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381,

388–89 (1940); see also Carter v. Carter Coal Co., 298

U.S. 238 (1936).15

If there were no private nondelegation doctrine,

Congress could empower private entities or

15 The Carter Coal decision “did not specify which provision—the

Legislative Vesting Clause or the Fifth Amendment Due Process

Clause—the statute offended. But because . . . Carter Coal cited

Schechter Poultry, a Vesting Clause case, alongside Due Process

cases, the Court presumably held the delegation was unlawful on

both grounds.” Pet. App. 45a. n.15; accord Paul J. Larkin, The

Private Delegation Doctrine, 73 FLA. L. REV. 31, 44 (2021) (“It

would . . . violate the Due Process Clause altogether to exempt

someone exercising delegated government power from

compliance with the law.”). A series of cases sustaining state laws

authorizing state officials to reopen banks with the consent of a

certain percentage of their creditors suggest that under state

constitutions, private nondelegation is a doctrine rooted in due

process of law, as opposed to separated powers more generally.

See Doty v. Love, 295 U.S. 64, 71–73 (1935); Dorman v. Dell, 245

Ky. 34, 38–40 (1934); Milner v. Gibson, 249 Ky. 594, 601 (1933);

Nagel v. Ghingher, 166 Md. 231, 241–42 (1934); McConville v. Ft.

Pierce Bank & Trust Co., 101 Fla. 727, 733 (1931); Smith v.

Texley, 55 S.D. 190, 194 (1929); Hoff v. First State Bank, 174

Minn. 36, 44–45 (1928). Still, separation of powers and due

process of law are not mutually exclusive. They are closely related

and mutually reinforcing. See, e.g., Nathan S. Chapman &

Michael W. McConnell, Due Process as Separation of Powers, 121

YALE L.J. 1672 (2012).

“individual[s to] exercise significant governmental

authority free from [constitutional] constraints, so

long as they served outside of an ongoing position.”

Jennifer Mascott, Private Delegation Outside of

Executive Supervision, 45 HARV. L. REV. 837, 848

(2022). That is, Congress could create headless fourth,

fifth, or sixth branches of “government” comprising

private officials—a modern and secular “millet

system”16—that would undermine the Framers’ design

and dilute democratic accountability.

In this case, the government has empowered a

private entity to tax American citizens without the

“pervasive oversight and authority” required by this

Court’s precedents. Adkins, 310 U.S at 388–89. USAC

sets the program’s budget each quarter, “includ[ing]

the cost of funding USAC itself.” Resp. Br. 3. The FCC

merely “converts that figure [from USAC] into a [tax

rate] that will apply to certain telecommunications

revenues.” Resp. Br. 3.

As the en banc court below explained, “USAC is

responsible for deciding the quarterly USF

contribution amount” as a “percentage of [each

carrier’s] end-user telecommunications revenue.” Pet.

App. 6a. “As a practical matter,” the court continued,

“USAC sets the tax,” and the FCC merely “rubber

stamp[s]” it. Id. at 7a. Indeed, the FCC’s rubberstamp

16 In the Ottoman millet system, the Sultan and his state officials

delegated autonomy and legal jurisdiction to leaders of nonMuslim Ottoman subjects. Heads of millets had near-absolute

secular and ecclesiastical power over their communities. See, e.g.,

Karen Barkey & George Gavrilis, The Ottoman Millet System:

Non-Territorial Autonomy and its Contemporary Legacy, 15

ETHNOPOLITICS 24 (2016). Whatever the merits of the millet

system, it is foreign to our Constitution.

is not even a prerequisite, as USAC’s proposals

automatically become law within 14 days absent

adverse agency action. 47 C.F.R. § 54.709(a)(3). To call

this uncapped revenue-generating system “on

autopilot” is being generous—it appears the passive

approvals of USAC tax rates would continue even if

the FCC lacked a quorum to commence normal agency

operations. See 47 U.S.C. § 154(h).

As Respondents emphasize, “[t]here is no evidence

the FCC itself actually reviews USAC’s work.” Resp.

Br. 3 (emphasis added). Indeed, given that the “entire

[approval] process happens only days before the new

quarter begins, . . . FCC [has] no real option but to

accept whatever numbers USAC demands.” Id. at 4

(emphasis added). Thus, USAC’s work “is far from a

ministerial undertaking.” Id.

A. CONGRESS HISTORICALLY DELEGATED

ONLY MINISTERIAL TASKS TO PRIVATE

ACTORS.

Congress’s delegations of power to USAC are

historically unprecedented.17 To be sure, there is

historical pedigree for certain types of private

17 While early congressional practice is not dispositive as to a

measure’s constitutionality, see, e.g., Marbury v. Madison, 5 U.S.

(1 Cranch) 137 (1803), and while “constitutional principles of

separated powers are not violated . . . by mere anomaly or

innovation,” Mistretta, 488 U.S. at 373 n.7, history and tradition

are at least “probative” of the Constitution’s original meaning.

Trump v. Anderson, 601 U.S. 100, 122 (2024) (Barrett, J.,

concurring in part and concurring in the judgment); see, e.g.,

Mistretta, 488 U.S. at 398–99 (considering how “early history”

shed light on whether Article III judges could simultaneously

serve in extrajudicial roles); Bowsher v. Synar, 478 U.S. 714, 723–

24 (1986) (weighing actions by members of the First Congress).

delegations. See generally Mascott, supra. These

arrangements offer “a glimpse” of how the founding

generation understood “the scope of tasks that

Congress may constitutionally delegate to private

actors.” Id. at 848.

Founding-era history suggests that Congress may

assign only “ministerial tasks” to private parties, and

even then, “the performance of those tasks [must] not

constitute a portion of the delegated sovereign

authority of the United States.” Id. at 866 (emphasis

added). Private parties exercise sovereign authority

when their actions bind the legal rights of other

citizens “absent subsequent sanction” by the

government. Id. at 914 n.296 (internal quotation

marks omitted).

Two examples from early American history

illustrate what the founding generation and early

American legislators considered permissible private

delegations: (1) private boatman employed to enforce

customs laws; and (2) private boards of experts

established to review patent denials by the

Commissioner of Patents. Neither example provides a

historical analog to USAC nor suggest that Congress’s

delegations here are consistent with the original

understanding of Article I.

Historically,

Congress

has

hired

“nongovernmental actors . . . for expert services in which

they complete[] measurements or other types of

empirical assessments.” Id. at 916. These delegations

look nothing like a substantive tax power, which is

inherently a sovereign power. Id. at 905.

Around the time of the founding, Congress

employed private “boatmen” as “inspectors, weighers,

measurers, and gaugers . . . to measure the quantity of

goods on which the customs duties were to be

assessed.” Id. at 861 (internal quotation marks

omitted) (quoting § 6, 1 Stat. 145, 154; § 53, 1 Stat. at

172). The Framers considered these quintessential

“ministerial tasks” because customs inspectors “had

very little discretion” given “the detailed nature of the

customs rates . . . that Congress had developed and

imposed.” Id. at 861–862, 866.

Critically, “the sovereign act . . . occurred at the

point that Congress authorized and assigned weight to

the expert assessment,” not during the “actual expert

assessment” itself. Id. at 897 (emphasis added). It was

for Congress, not the boatmen, to “bind the legal

rights” of citizens. Id. at 914 n.296

The other prominent example of Congress

delegating expert services to private parties occurred

in 1836, when Congress created “nongovernmental

boards of experts” to review the denial of patents by

the Commissioner of Patents. Id. at 879. If the

Commissioner determined that an applicant was not

entitled to a patent, the applicant could appeal to the

board, which consisted of “three disinterested persons”

selected by the Secretary of State “for that purpose.”

Id. at 891 (quoting § 7, 5 Stat. 117, 120). Board

members were “private experts” who served on a caseby-case basis, “not governmental officers of any kind.”

Id. at 858.

These boards were not as strictly ministerial as the

private boatmen used in customs. For example, they

could “effectuat[e] binding reversal of prior Patent

Commissioner assessments” and make “mixed factlaw determinations regarding threshold patentability

findings on obviousness and interference.” Id. at 856,

863, 882 (emphasis added). Although Congress did

grant some discretion to these private parties, the

Founding Generation viewed the Executive Branch’s

role in evaluating patents as “ministerial,”18 so this

delegation to private actors was constitutionally

unremarkable. Furthermore, the boards “did not have

binding sovereign authority to set the terms for future

proceedings.” Mascott, supra, at 899.

In any case, courts never evaluated the

constitutionality of these boards, and this governance

experiment was short-lived, lasting from 1836 to 1839,

when Congress “transferred the power of the 1836

boards to the [chief] district judge [of the District of

Columbia.]” Id. at 903.

B. USAC FALLS FAR OUTSIDE THE

HISTORICAL TRADITION OF PRIVATE

DELEGATIONS.

USAC falls far outside this historical tradition of

Congress employing private actors to administer

technical services under federal law. USAC—a private

entity comprising private actors—binds the legal

18 For instance, an 1812 letter from the U.S. Attorney General to

the Secretary of State “concluded that the Secretary . . . lacked

discretion to decline to issue a patent once the prospective

patentee had complied with the congressionally mandated

application process.” Mascott, supra, at 898 (citing Patents for

Inventions, 1 Op. Att’y Gen. 170, 171 (1812)). Similarly, in 1831,

the Attorney General confirmed that when granting patents, the

Executive “acts ministerially,” reasoning that satisfaction of

statutory criteria removes “an[y] examination of the question of

right.” Id. (internal quotation marks omitted) (quoting Patents,

Patent Office, and Clerks, 2 Op. Att’y Gen. 454, 454–55 (1831)).

See also Grant v. Raymond, 31 U.S. (6 Pet.) 218, 241 (1832)

(noting that the Secretary issued patents through a routine

process “as a ministerial officer”).

obligations of most Americans “absent subsequent

sanction” by the government. Id. at 914 n.296 (internal

quotation marks omitted). “And surely [much]

discretion inheres in decisions about how much money

to allocate to a massive federal welfare program.” Pet.

App. 54a.

In short, USAC does not resemble the private

boatmen Congress employed as measurers and

gaugers in 1789, nor the private boards created to

review patentability findings in 1836. Instead, USAC

is “a private company [that] is taxing Americans in

amounts that total billions of dollars every year, under

penalty of law, without true governmental

accountability.” Resp. Br. 4. It is a “junior varsity

Congress” working outside and in contravention of the

separation of powers. Mistretta, 488 U.S. at 427

(Scalia, J., dissenting). The constitutional problems

are immediate and far-reaching.

CONCLUSION

For the foregoing reasons, and those presented by

Respondents, the Court should affirm the decision

below.

Respectfully submitted,