Utilizing USAC to Determine FUSF Contributions Does Not Violate the Non-Delegation Doctrine
SUMMARY
On June 27, 2025, the Supreme Court of the United States (“SCOTUS”) released an Opinion in FCC et al. v. Consumers’ Research et al. upholding the constitutionality of the Federal Communications Commission’s (“FCC’s”) implementation of Section 254 pertaining to Universal Service and the utilization of an Administrator (currently the Universal Service Administrative Company (“USAC”)) to assist in the Universal Service Fund’s (“USF”) day-to-day operations and calculation of the contribution factor.
WHAT IMPACTS ARE ANTICIPATED
This is GOOD NEWS! The Supreme Court upheld the constitutionality of the current scheme of USF administration and contributions. Some key points of the decision important to share are:
- USF Funding Mechanism Upheld: SCOTUS ruled the FCC’s method of funding the USF is constitutional.
- Non-Delegation Doctrine: SCOTUS determined Congress had provided sufficient guidance to the FCC in the 1996 law establishing the USF. Based on this decision, it avoided an unconstitutional delegation of legislative power and provided “intelligible principles” of guidance (sufficiency, clear definitions, and fund criteria).
- Delegation to USAC: The FCC’s delegation of certain administrative duties related to USF to USAC was deemed permissible. This is due to the fact USAC’s role is ministerial and subservient to the FCC.
- Rejection of the Fifth Circuit’s Ruling: SCOTUS overturned the Fifth Circuit Court of Appeals’ earlier ruling, which had found the USF funding mechanism unconstitutional.
- Significance for Broadband Access: The decision ensures the continuation of the USF support. (USF provides billions of dollars in subsidies to support broadband access for underserved communities, schools, libraries, and rural healthcare providers.)
HOW VANTAGE POINT CAN HELP
Vantage Point Solutions (“VPS”) monitors major decisions impacting the USF and assists companies in USF compliance. This support includes services such as: initial eligibility assistance, cost accounting, annual reporting, and contributing to the USF.
