Revamping Predictive Judgments & Interim Rules

In addition to setting overall timelines for Commission review of agency rules, as I previously suggested, there are two agency practices that warrant re-evaluation: where the agency uses “predictive judgment” to establish a policy or rule; and where the agency adopts an “interim” rule. In both instances, the Commission supposedly relies on the best information to make a decision that is inherently time limited. Unfortunately, when used, there is often no follow-up with hard facts or final guidelines. That means those offering or getting communications services in the marketplace are forced to adhere to rules based on stale decisions or outdated information. We can and need to do better.

Predictive Judgments

During its proceedings, the FCC sometimes makes predictions about how marketplaces will evolve and about the effect of its rules or policies for the industry and stakeholders. This exercise is intended to be an educated and reasoned estimation, based on the circumstances before the Commission during the time, of the most logical and likely outcome in a particular situation. As an specialist agency, the FCC’s “predictive judgments” are often afforded deference by the courts, provided that they fall within the agency’s “field of discretion and expertise” and are the result of “reasoned decision-making”. Therefore , it is not uncommon for the FCC in order to invoke this terminology in its orders, particularly when it comes to controversial decisions that are likely to be challenged in court. Certainly, the term is used more than a dozen moments in the 2015 Net Neutrality Purchase and 8 times in the last year USF/ICC Transformation Order. It was lately used as a foundation for the Commission’s decision that designated entities getting taxpayer subsidies to participate in wireless auctions can lease all of their spectrum and do not have to be facilities based. Plus, predictive judgment even appeared as a justification for creating reserve licenses in the upcoming incentive auction.

When employed, courts have discussed that the agency has a duty in order to reevaluate its predictions should they fail to materialize. For example , in Aeronautical Radio v FCC , one court deferred to the Commission’s predictions on the effectiveness of global coordination “with the caveat , however , that, if the Commission’s predictions… prove erroneous, the Commission will need to reconsider its [decision] in accordance with its continuing obligation to practice reasoned decisionmaking. ” Nonetheless, the FCC’s predictions, as well as the rules and policies based upon all of them, can endure for years without being revisited. Indeed, they are typically reexamined only when the agency has a desire to reverse prior decisions.

It shouldn’t come as a surprise that predictions made years ago about how technology, especially the Internet, may develop are not always on target. In some regards, it is unfair to ask personnel to act as a prognosticator in one of the the majority of dynamic and changing fields. To place it in perspective, even with all the best information in the world available today, how many people could accurately select the Super Dish winner for 2016? 2020? 2025? Take for instance the Commission’s wireless E911 location accuracy proceeding where predictions regarding the future availability of technology are used as support for implementing specifications on industry in a particular timeframe. We will see how our predictions cost this time, but we certainly have not had a good track record of predicting the availability plus penetration of such technology during the past. The ultimate value of predictive judgments and thus their use by the Commission can be questionable but that will have to await another day.

In the meantime, we need to address the acceptable life associated with any predictive judgment. The haphazard approach of making predictions, failing in order to timely review and then rejecting all of them as it suits the agency’s passions is inconsistent with the FCC’s continuous duty to engage in reasoned decision-making. Instead, whenever the FCC basics a decision on a predictive judgment, it will include a timeframe for revisiting the prediction. The exact duration will depend on the circumstances. However , it is not unreasonable to expect that the predictive judgment not be allowed to last for more than three to five years with out affirmative review. Predictions of advancements outside that time frame are really no more than guesses, and would raise severe questions about whether agency intervention is premature.

Interim Rules

The FCC also receives significant deference from the courts when it adopts “interim” rules. This can occur once the FCC is attempting to preserve the status quo or avoid a market disruption pending the completion of a broader rulemaking proceeding. While adopting an “interim” regulation can be a legitimate exercise associated with agency authority, we have also observed examples where it has been invoked in order to lock in a policy preference for an extensive period of time, free from significant legal challenge.

Of course , the deference afforded to the agency is not unlimited, and courts do grow impatient when an interim measure remains in essence for years. For example , a court overturned an FCC “interim” rule concerning access charges that had been in place for an astonishing 13 years. But celebrations should not have to wait years for your FCC to adopt final rules, or bear the cost of pursuing legal motion to force the FCC to act sooner.

In most cases, the FCC ties the interim rule to the completion of a specific rulemaking going forward, which gives the appearance that interim guidelines will not have an unlimited duration. But with out setting a specific timeline as a backstop, the Commission is under simply no pressure to act quickly. We have numerous interim rules on the books that have been pending finalization for years.

Therefore , any interim rule needs to be accompanied by a timeframe for completing the ultimate rules. Here, the presumption needs to be that an interim rule not last for more than 18 months. Even complicated rulemakings have been completed within a calendar year, so allotting 18 months would be over generous in most instances. And nothing stops the Commission from extending that time frame as it approaches expiration or setting a slightly longer 1 for particularly difficult situations.

The Commission’s new Procedure Review Task Force should include these practices to its listing due for scrutiny.


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