On August 12, 2020, the U.S. Court of Appeals for the 9th Circuit issued an opinion upholding the majority of three 2018 FCC orders aimed at accelerating the deployment of wireless and wireline broadband infrastructure: Small Cell Order, 33 FCC Rcd 9088 (2018); Moratoria Order, 33 FCC Rcd 7705, 7775-91 (2018) and One Touch Make-Ready Order, 33 FCC Rcd 7705, 7705-91 (2018). The Small Cell Order and Moratoria Order focused on the limits of local governments’ authority to regulate telecommunications providers, while the One Touch Make-Ready Order sought to prevent owners and operators of utility poles from discriminatorily denying or delaying 5G and broadband service providers access to the poles. Local governments, public and private power utilities and wireless service providers sought review of the orders. This decision is viewed as a victory for wireless carriers and the FCC, as these orders were the main planks in the FCC’s efforts to ease the infrastructure burdens associated with broadband deployment.
The panel held that, given the deference owed to the FCC, the Small Cell and Moratoria Orders were, with the exception of one provision discussed below, in accord with the congressional directive in the Telecommunications Act of 1996 (the “Act”), and not otherwise arbitrary, capricious, or contrary to law. The panel rejected constitutional challenges under the Fifth and Tenth Amendments to both orders. The panel also upheld the One Touch Make-Ready Order, concluding that the FCC reasonably interpreted Section 224 of the Act and rejecting challenges to other aspects of the Order including rules for overlashing, preexisting violations, self-help, and rate reform.
The exception in the Small Cell Order was the provision concerning local government authority over aesthetic regulations. The panel held that the FCC’s requirement that aesthetic regulations be “no more burdensome” than regulations applied to other infrastructure deployment was contrary to the congressional directive that allowed different regulatory treatment among types of providers, so long as such treatment did not “unreasonably discriminate among providers of functionally equivalent services.” 47 U.S.C. § 332(c)(7)(B)(i)(I). The panel also held that the FCC’s requirement that all aesthetic criteria must be “objective” lacked a reasoned explanation. The panel vacated those portions of the rule and remanded them to the FCC.
Judge Bress joined the majority decision but issued a partial dissent re: the court’s upholding the FCC’s decision to preempt any fees charged to wireless or telecommunications providers that exceed a locality’s costs for hosting communications equipment, stating that the FCC “had not adequately explained how all above-cost fees amount to an ‘effective prohibition’ on telecommunications or wireless service” under Sections 253 and 332 of the Act.
Chairman Pai and Commissioner Carr have each released statements applauding the decision.
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