Correspondence to the FCC re: preemption of local government as a source of regulation

For those interested, first in my morning's inbox is a letter from Oregon State Senator Bruce Starr (R-15, Hillsboro), and Nevada State Senator Debbie Smith (D-13), President and President-elect, respectively, of the National Conference of State Legislatures to FCC Chairman Thomas Wheeler, expressing their firm conviction as of Tuesday of this week that states have the constitutional authority to preempt municipalities in the domain of communications infrastructure.

The letter is not a legal memo, so it expresses little of any use. Anyone wanting a copy can probably find it on either the FCC or the NCSL websites.

Next is "by hand" of today from Jim Baller, retained by the Electrical Power Board of the City of Chatanooga, to the FCC. It is a 64pp legal memo constituting a "Petition for Removal of Barriers to Broadband Investment and Competition", that is, an argument that Section 706 of the Telecommunication Act of 1996 takes precedence over Tenn. Code Ann. � 7-52-601 ("Section 601").

Here is the link:

I expect the second correspondence will make more interesting reading.


For the record, Eric, I'm certain that states can preempt municipalities. The question is can FCC preempt States?
- jra

For the record, Eric, I'm certain that states can preempt municipalities.


Actually, it usually stands on its head: states determine the scope of
what local governments are -permitted- and required to do rather than
what they're forbidden.

Traditionally, sanctioning the local cable TV company has been one of
the activities the states assign to individual localities while
sanctioning the local telephone company has been kept up at the state
corporation commission or public utilities commission.

With the convergence of cable TV and telephone into Internet, it's
anybody's guess which regulation goes where. Everybody wants the
power. Nobody wants the responsibility.

The question is can FCC preempt States?

Generally yes, as long as there is some aspect of the activity that
moves it into the realm of interstate commerce. The FCC would have
trouble preempting the states on a pure layer-1 fiber build but it is
within the federal government's authority to preempt state regulation
on general Internet access and any infrastructure not meticulously
separated from the same.

For example, the FCC preempts all state and local regulation of
sub-meter satellite dishes on the grounds that satellite
communications is fundamentally interstate in nature. They even
preempt homeowners' association rules.

There's also the question of whether the FCC already has the authority
or if they'd need an act of congress to get it. On that question, I
have no idea.

Bill Herrin

Well that's where it gets tricky.

Section 253 of the Telecom Act says that nobody can write laws or regulations that preempt "any entity" from entering the telecom business. The Act gives the FCC the power to preempt such laws and regulations.

But, the Supreme Court has ruled that municipalities are subdivisions of the states - and the states can do whatever they want in regulating their piece parts. So the FCC can't pre-empt the States in a lot of these cases. A good summary, with citations, is at

But......... the Supreme Court decision waffled on municipal utilities that are organized as independent authorities (i.e., separate legal entities). I don't believe that's been tested up the chain to the Supreme Court - and I'll note that most of the successful municipal telecom. projects have been by electric power boards. (But that success probably has more to do with those entities already being operating entities, with people, customers, billing, rights-of-way, and a need to string fiber for their own purposes.)

I'm also not clear on where the Supreme Court leaves "home rule" states, where municipalities are more at arms length from. Any lawyers here who can comment?

Some more discussion at -- from Jim Baller, who is a very sharp attorney who does a lot of work for municipalities, on telecom.

Miles Fidelman

Jay Ashworth wrote:

The question posed is whether or not a state can control where a local governmental agencies can provide service. In the document below, the Electric Power Board of Chattanooga (EPB) wants to expand its internet into a location that outside it's authorized area.

Hi Roy,

If the answer is anything other than, "of course they can," then I
really want to read the judge's opinion. There are no shortage of
examples of one locality providing services to another (it happens all
the time with water systems) but I've not heard of such happening
contrary to the wishes of the respective state government.

Bill Herrin

I agree 100%. If a municipality wants to provide service to its citizens and contracts it out, nothing prevents that.