Reforming the FCC

The FCC’s lack of transparency operates on a number of levels. First, when the agency announces a rulemaking, it rarely suggests specific rules and sometimes does not even ask specific questions for parties to address. Second, the FCC’s notice-and-comment processes are often a meaningless precursor to the “real” discussion that occurs during the so-called ex parte process, where parties file short statements that, at least often in practice, do not set out the full extent of oral discussions. This unofficial opportunity for comment, which is not regulated by any legal framework and generally is available only to those well connected to the agency, was judged by FCC Chairman Powell in 2005 as “out of control.”^[82] Finally, when the FCC announces its adoption of an order, it often does so without releasing the actual text, raising questions as to what the agency actually voted on and what happens between the so-called vote and the final issuance of the order-which can take place many months later. I will discuss how and why the FCC needs to reform each of these shortcomings.

In terms of the use of rulemaking proceedings, the FCC has gotten into the habit of commencing wide-open rulemakings that do not propose specific rules and leave parties with the challenge of guessing what issues are really important-or reserving their energies and resources until the ex parte process when that might become clear. Technically speaking, this practice does not violate the Administrative Procedure Act, as that law only specifies that NPRMs must include “a description of the subjects or issues involved.”^[83] Practically speaking, however, this practice undermines the opportunity for meaningful participation and effective deliberation.

To appreciate the real world impact of the FCC’s practice, consider the case of a recent initiative to impose requirements on local radio stations to compile playlists and community outreach efforts.^[84] The basic idea behind the proceeding-to develop more information related to how radio stations operate-was a noble one (see Part III, below), but the way it was conducted deprived the public and affected parties of key information that could have informed their participation and feedback. In that case, radio lobbyists were left scrambling to find out relevant details about the specific proposal, such as who would have to submit such reports and how often.^[85] Unfortunately, the situation was hardly unique, with “[c]ommunications lawyers and lobbyists privately complain[ing] they have difficulty figuring out the status of their issues at the FCC.”^[86] This state of affairs raises the obvious question that, in an environment where even some well-connected lobbyists cannot discern such information, how can ordinary consumers hope to offer meaningful input?

To remedy the FCC’s use of vague and generalized NPRMs, the agency should commit to publishing model rules or at least specific suggestions on any topic it envisions addressing to set the stage for public comment. If the agency engages in the strategic planning effort suggested above, disclosing more relevant details at the outset of proceedings should flow naturally. Notably, releasing the proposed rules up front is the common practice for many other agencies;^[87] for the FCC, however, it constitutes the exception. This places the FCC far outside the norm of most agencies, which release notices that “routinely contain the full text of the rule as well as lengthy preambles, including the information, data, and analyses upon which the agency relied.”^[88]

If the FCC persists in opening proceedings with only a general description of the relevant issues, it has two options for providing sufficient notice and enabling effective deliberation. First, it could begin with a Notice of Inquiry, which is designed to elevate the agency’s understanding of an issue and not to generate binding rules. Alternatively, if it does use an NPRM with limited disclosure of the issues that ultimately emerge as important, it should issue a Further Notice of Proposed Rulemaking, as the agency recently did in the so-called D Block proceeding (which was designed to facilitate the emergence of a private-public partnership for public safety communications).^[89]

As for the ex parte process, the agency’s commitment to greater transparency as to what issues are up for discussion at the commencement of a rulemaking will limit the need and opportunity for a heavy reliance on ex parte communications. In any event, the agency needs to take seriously the commitment to a reasonable level of disclosure when ex parte meetings take place. Indeed, in some cases, the general disclosures in the filings that accompany such meetings verge on the comedic. Take, for example, a filing by Alltel that stated merely that company officials met with a few FCC staff persons “to share our thoughts” on a particular proceeding.^[90] This sort of filing has repercussions for the parties themselves insofar as their desire to keep their presentations secret is at odds with the legal requirement to make “a record” of their objection in order to pursue them on appeal. Thus, a system of ex parte filings devoid of content not only is detrimental to informed deliberation of the relevant issues, but also undermines the opportunity for meaningful judicial review.^[91] To be sure, the penalty placed on parties deprived of judicial review provides some incentive not to engage in the prevailing practice, but the culture of secrecy retains a powerful hold on those engaged in the ex parte process. Consequently, the appropriate remedy is a fundamental reform of how the agency operates, including not merely ending the use of vague NPRMs, but also requiring agency officials (as opposed to lobbyists) to be responsible for filing the document that captures the relevant discussions (as many other agencies require).^[92]

The abuse of the ex parte process is exacerbated by two features of FCC proceedings that are under the Commission’s control-(1) the length of the proceedings; and (2) the lack of a well-developed and evidence-based record. First, if the FCC could manage its proceedings with an eye to how issues are developed and commit, as a general strategy, to open a Further NPRM after a certain interval, it would elevate the importance of “official” filings-as opposed to placing the real weight on ex parte filings. One option, suggested by a few commentators, is to institute a “shot clock” that would require agency action within a prescribed period of time.^[93] Rather than impose a procedure that would artificially rush resolution of difficult issues, however, the agency should institute the norm that it will conduct proceedings in a timely manner and embarrass itself when it does not-prominently listing on its website the pending proceedings, how long they have remained unresolved, and the status of the record.^[94] Second, if the FCC would, as discussed below, use Administrative Law Judges (ALJs) to conduct proceedings and develop an evidentiary record through open testimony under oath, it could radically change the agency’s culture. In particular, once an ALJ published proposed findings of fact for evaluation by the Commission, the discussion would center on a relevant set of issues grounded in empirical data, ending the guesswork that drives much of the ex parte process for those who are not well-connected lobbyists.^[95] Third, as discussed below, the FCC could commission and publish independent research to inform its deliberations and highlight the relevant issues for discussion.

Finally, as to the FCC’s procedure for adopting rules, the agency needs to commit to issuing its written opinions on the day the decision is announced. At present, many high profile matters are decided when the actual written opinion has yet to be finalized. As for what the agency does during this time, one commentator suggested that the opinions do not reflect “well-reasoned statements of principle,” but rather are a “patchwork of pieces” that must be stitched together after the decision is announced, often requiring substantive redrafting.^[96]