Spurred by the FCC’s decision to preempt state laws limiting the deployment of municipal broadband networks in certain Tennessee and North Carolina localities, seven Republican lawmakers, led by Rep. Marsha Blackburn (R-TN) and Senator Thom Tillis (R-NC), introduced legislation late last week that would prevent the FCC from preempting state laws that restrict construction or operation of broadband networks by municipal entities.

By a 3-2 vote along party lines, the FCC adopted a Memorandum Opinion and Order (MO&O) last Thursday granting petitions filed last summer by the Electric Power Board of Chattanooga, Tennessee (EPBC) and the City of Wilson, North Carolina for pre-emption of state laws that limit the expansion of municipal broadband networks.   In addition to operating electric utilities, the ECPB and the City of Wilson both operate gigabit-speed broadband networks that provide data, video and voice services to customers.  Specifically, the MO&O preempts geographic restrictions in the State of Tennessee that prohibit the ECPB and other utilities from  offering broadband and video services beyond their electric service area boundaries.  With respect to the Wilson petition, the FCC said the MO&O preempts “numerous conditions” imposed by North Carolina law that “effectively precluded Wilson from expanding broadband into neighboring counties, even if requested.”  

While the MO&O applies only to state laws that affect municipal broadband networks in Chattanooga and Wilson, observers say that the FCC’s decision is likelyto serve as a blueprint for FCC action in the event similar petitionsare brought to the agency’s attention in the future. The FCC also premised its authority to preempt state law upon Section 706 of the 1996 Telecommunications Act, which requires the FCC to ensure that advanced telecommunications capability is being deployed to Americans in a reasonable and timely manner.  Charging, “some states have designed thickets of red tape designed to limit competition,” FCC Chairman Tom Wheeler told reporters, “we are cutting away that red tape consistent with Congress’s instructions to encourage the deployment of broadband.”  

The States’ Rights Municipal Broadband Act introduced by Blackburn and Tillis would, however, amend Section 706 to bar the FCC from preempting laws restricting municipal broadband networks in 21 states that have enacted such legislation and in any other state that adopts such laws in the future.  As Blackburn decreed that “states are sovereign entities that have constitutional rights which should be respected rather than trampled upon,” Tillis told reporters that he joined Blackburn in recognizing “the need for Congress to step in.” Senators Ron Wyden (D-OR), Ed Markey (D-MA), Corey Booker (D-NJ) and other Democratic lawmakers voiced support for the FCC ruling.  Recalling that, “as mayor of Newark, I saw how cities are often in the best position to innovate and find solutions to the specific challenges facing their residents,” Booker applauded the FCC vote as a “step in the right directions as Americans seek to leverage their strengths in the digital age.”