Republican bill would overturn FCC municipal broadband decision

Seven Republican lawmakers introduced a bill on Thursday, just hours after the FCC vote, that would prohibit the agency from preempting state laws that limit municipal broadband networks. The main sponsors of the bill are Representative Marsha Blackburn, of Tennessee, and Senator Thom Tillis, of North Carolina.

Earlier Thursday, the Democratic majority at the FCC voted to largely overturn laws in the two lawmakers' home states that prevent city-funded broadband networks from expanding to new areas. The FCC order, coming in response to petitions from a city in each state, does not apply to laws that limit municipal broadband networks in about 20 other states, but the vote signals how the agency may act if it gets similar petitions from cities in other states, FCC officials said.

FCC Chairman Tom Wheeler defended the FCC vote. The decision preempts "two restrictive state laws hampering investment and deployment of broadband networks in areas where consumers would benefit from greater levels of broadband service," he said during Thursday's FCC meeting.

The new Republican legislation would bar the FCC from preempting state municipal broadband laws now on the books or adopted in the future. It's unclear if the legislation will pass Congress, but it would likely face a veto from President Barack Obama, who supports FCC preemption of state laws limiting municipal broadband projects.

Lawmakers in several states have also said they plan to file a lawsuit to challenge the FCC's authority to preempt state laws. The National Association of Regulatory Utility Commissioners on Thursday, as they have in the past, suggested a lawsuit is likely.

"By asserting jurisdiction where it clearly has none, the FCC is setting itself up for wasteful and unnecessary litigation," Chris Nelson, chairman of the NARUC Committee on Telecommunications, said in a statement.

While critics of the FCC action say it runs counter to states' rights, FCC officials say the U.S. Constitution gives the agency authority over interstate commerce, including broadband.

The Republican legislation will protect the rights of states to make their own laws, Tillis said in a statement.

"After witnessing how some local governments wasted taxpayer dollars and accumulated millions in debt through poor decision making, the legislatures of states like North Carolina and Tennessee passed commonsense, bipartisan laws that protect hardworking taxpayers and maintain the fairness of free-market competition," he added.

State groups and some congressional Republicans say municipal broadband services use taxpayer money to compete with private broadband providers. In a handful of cases, municipal broadband projects have run into financial problems after large initial investments, critics note.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's email address is grant_gross@idg.com.