FCC v. Consumers' Research

Procedural entryThis page is a short order in FCC v. Consumers' Research. Read the opinion of the Court — 606 U.S. 656
Supreme Court of the United States·Decided June 27, 2025·No. 24-354·Published

Opinion

(Slip Opinion) OCTOBER TERM, 2024 1

Syllabus

NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.

SUPREME COURT OF THE UNITED STATES

FEDERAL COMMUNICATIONS COMMISSION ET AL. v. CONSUMERS’ RESEARCH ET AL.

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

No. 24–354. Argued March 26, 2025—Decided June 27, 2025* The Communications Act of 1934 established the Federal Communica- tions Commission (FCC or Commission) and instructed it to make available to “all the people of the United States,” reliable communica- tions services “at reasonable charges.” 47 U. S. C. §151. That objective is today known as “universal service.” The universal-service project arose from the concern that pure market mechanisms would leave some population segments—such as the poor and those in rural ar- eas—without access to needed communications services. Under the 1934 Act, the FCC pursued universal service primarily through im- plicit subsidies, using its rate-regulation authority to lower costs for some consumers at the expense of others. In 1996, Congress amended the Act and created a new framework for achieving universal service. Section 254 of the amended statute requires every carrier providing interstate telecommunications ser- vices to “contribute” to a fund, known as the Universal Service Fund. See §254(d). The FCC must use the money in the Fund to pay for uni- versal-service subsidy programs. See §§254(a), (d), (e). The statute designates the beneficiaries of universal-service subsidies—low-in- come consumers, those in rural areas, schools and libraries, and rural hospitals. §§254(b)(3), (h)(1), (j). And it provides detailed guidance regarding the communications services to which those beneficiaries should have access. In deciding what services to subsidize, the FCC “shall consider the extent to which” a service is “essential to education, —————— *Together with No. 24–422, Schools, Health, & Libraries Broadband Coalition et al. v. Consumers’ Research et al., also on certiorari to the same court. 2 FCC v. CONSUMERS’ RESEARCH

public health, or public safety” and has “been subscribed to by a sub- stantial majority of residential customers.” §§254(c)(1)(A)–(B). So too, the Commission must evaluate whether a service can be made availa- ble at an “affordable rate[ ].” §254(b)(1). Section 254 also sets forth “principles” on which the FCC “shall base” its universal-service poli- cies. §254(b). Among other things, those principles direct that all con- sumers, “including low-income consumers” and those in “rural” areas, should have access to quality services at affordable prices. See ibid. The FCC also may add “other principles” found both “consistent with” the Act and “necessary and appropriate for the protection of the public interest, convenience, and necessity.” §254(b)(7). To calculate how much carriers must contribute to the Fund, the FCC has devised a formula, known as the “contribution factor.” 47 CFR §54.709(a). That factor is a fraction, expressed as a percentage, whose numerator is the Fund’s projected quarterly expenses (the sub- sidy payments it will make plus overhead) and whose denominator is contributing carriers’ total projected quarterly revenue. §54.709(a)(2). A carrier must pay into the Fund an amount equal to its own projected revenue multiplied by the contribution factor. §54.709(a)(3). The FCC has appointed the Universal Service Administrative Com- pany, a private, not-for-profit corporation, as the Fund’s “permanent Administrator.” §54.701(a). The Administrator manages the Fund’s day-to-day operations and also plays a role in producing the financial projections that end up determining the contribution factor. See §§54.702, 54.709(a)(2)–(3). Each quarter, the Administrator projects the Fund’s expenses, adds up revenue estimates it receives from carri- ers, and submits those figures to the Commission for approval and eventual use in calculating the contribution factor. See §§54.709(a)(2)–(3). In December 2021, the FCC set a 25.2% contribution factor for the first quarter of 2022. Consumers’ Research petitioned for review in the Fifth Circuit, contending that the universal-service contribution scheme violates the nondelegation doctrine. The en banc court granted the petition, replacing a panel decision to the contrary. See 109 F. 4th 743; 63 F. 4th 441. In the full Fifth Circuit’s view, the combination of Congress’s delegation to the FCC and the FCC’s “subdelegation” to the Administrator violated the Constitution, even if neither delegation did so independently. 109 F. 4th, at 778. Held: The universal-service contribution scheme does not violate the nondelegation doctrine. Pp. 10–37. (a) Article I of the Constitution provides that “[a]ll legislative Pow- ers herein granted shall be vested in a Congress of the United States.” §1. Accompanying that assignment of power to Congress is a bar on its further delegation. At the same time, this Court has recognized Cite as: 606 U. S. ____ (2025) 3

that Congress may “seek[ ] assistance” from its coordinate branches and “vest[ ] discretion” in executive agencies to implement the laws it has enacted. J. W. Hampton, Jr., & Co. v. United States, 276 U. S. 394, 406. To distinguish between the permissible and the impermissi- ble in this sphere, this Court asks whether Congress has set out an “intelligible principle” to guide what it has given the agency to do. Id., at 409. Under that test, Congress must make clear both “the general policy” the agency must pursue and “the boundaries of [its] delegated authority.” American Power & Light Co. v. SEC, 329 U. S. 90, 105. Pp. 10–11. (b) Although the intelligible-principle standard has long guided this Court’s nondelegation doctrine, Consumers’ Research insists that a different test applies here. According to Consumers’ Research, univer- sal-service contributions are taxes. And tax statutes, Consumers’ Re- search argues, must satisfy a special nondelegation rule. For those statutes, Congress must set a definite or objective limit on how much money an agency can collect—a numeric cap, a fixed tax rate, or the equivalent. Section 254 contains no such limit, so, in Consumers’ Re- search’s view, it is unconstitutional. The Court rejects that argument. To begin with, precedent fore- closes it: In both J. W. Hampton, 276 U. S., at 409, and Skinner v. Mid- America Pipeline Co., 490 U. S. 212, 220–221, the Court declined re- quests to create a special nondelegation rule for revenue-raising legis- lation. The test Consumers’ Research proposes also would throw a host of federal statutes into doubt, as Congress has often empowered agencies to raise revenue without specifying a numeric cap or tax rate. See, e.g., 12 U. S. C. §§16, 243, 1815(d)(1). Consumers’ Research re- sponds that those other statutes can be distinguished as imposing fees, rather than taxes, and thus be exempted from its numeric-limit re- quirement. But Skinner made clear that whether a charge is a tax or a fee is irrelevant to the nondelegation inquiry. See 490 U. S., at 223.

Free access — add to your briefcase to read the full text and ask questions with AI

FCC v. Consumers' Research, (U.S. 2025).

FCC v. Consumers' Research (FCC v. Consumers' Research) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

M'culloch v. State of Maryland
17 U.S. 316 (Supreme Court, 1819)
Wayman v. Southard
23 U.S. 1 (Supreme Court, 1825)
Veazie Bank v. Fenno
75 U.S. 533 (Supreme Court, 1869)
Pace v. Burgess
92 U.S. 372 (Supreme Court, 1876)
Field v. Clark
143 U.S. 649 (Supreme Court, 1892)
In Re Kollock
165 U.S. 526 (Supreme Court, 1897)
Nicol v. Ames
173 U.S. 509 (Supreme Court, 1899)
Shurtleff v. United States
189 U.S. 311 (Supreme Court, 1903)
United States v. Detroit Timber & Lumber Co.
200 U.S. 321 (Supreme Court, 1906)
Myers v. United States
272 U.S. 52 (Supreme Court, 1926)
J. W. Hampton, Jr., & Co. v. United States
276 U.S. 394 (Supreme Court, 1928)
Panama Refining Co. v. Ryan
293 U.S. 388 (Supreme Court, 1935)
A. L. A. Schechter Poultry Corp. v. United States
295 U.S. 495 (Supreme Court, 1935)
Ashwander v. Tennessee Valley Authority
297 U.S. 288 (Supreme Court, 1936)
Carter v. Carter Coal Co.
298 U.S. 238 (Supreme Court, 1936)
United States v. Curtiss-Wright Export Corp.
299 U.S. 304 (Supreme Court, 1936)
United States v. Rock Royal Co-Operative, Inc.
307 U.S. 533 (Supreme Court, 1939)
Sunshine Anthracite Coal Co. v. Adkins
310 U.S. 381 (Supreme Court, 1940)