Republican lawmakers question FCC budget after net neutrality vote

The FCC's vote last Thursday to impose new net neutrality rules on broadband providers will likely face a court challenge, Representative Bill Johnson, an Ohio Republican, said during a hearing before the communications subcommittee of House Energy and Commerce Committee.

Defending the net neutrality order "will not be costless," Johnson said. "Wouldn't the commission have saved a significant amount of money if it had let Congress legislate on net neutrality instead of moving forward an ill-fated ... order that it knows is going to be litigated for years"

Johnson asked Jon Wilkins, the FCC's managing director, for a one-word answer to his question.

"No," Wilkins answered.

After a short pause, Johnson asked Wilkins to give a longer answer. The FCC's current budget request assumes the agency's current staffing will be able to handle any court challenges, and there are no additional budget requests for potential net neutrality lawsuits, Wilkins said. "In any given year, we'll have major litigation, we'll have major issues," and the FCC's staff is built to respond to them, he said.

Johnson pressed the issue. FCC attorneys don't respond to lawsuits "for free," he said. "If they weren't doing that, they would be doing other things that are meaningful and useful to the taxpayer."

Most lawmakers at the hearing steered clear of the net neutrality debate and focused more generally on the FCC's fiscal year 2016 budget request. The agency is asking for US$530 million, $84 million more than in fiscal year 2015. A big chunk of the requested increase, $51 million, would be to move to new headquarters or to consolidate operations in a smaller space at its current building. Either of those options would yield a projected $119 million in savings over 15 years, Wilkins said.

Another $21 million would go toward IT projects, with $15 million for replacing the agency's aging IT infrastructure, including the online public comment system that collapsed in June during a period of heavy net neutrality comment traffic.

Over half of the FCC's IT systems run software that's at least 10 years old, Wilkins said. "The cost of maintaining things that are older and older grows every year," he said. "The cost to do a software update for something that was installed in 2004 is astronomical, because almost no one else does it."

The FCC's budget rose slowly, from $421 million in fiscal year 2010, to $446 million in 2015.

Although most lawmakers avoided commenting on the FCC's net neutrality decision, subcommittee Chairman Greg Walden, an Oregon Republican, criticized the FCC, saying the agency in recent years "has struggled to reflect the evolution of technology."

The FCC still looks to its original statute, the 1934 Communications Act, to regulate the communications industry in "silos," instead of recognizing the convergence of technologies, he added.

The FCC's net neutrality vote "repudiated years of light-touch regulation" of the Internet, Walden said. "Nowhere is the Communications Act's failure of imagination more evident than in the FCC's decision to reclassify broadband service under rules developed to regulate the telegraph's heyday," Walden said.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's email address is grant_gross@idg.com.