Universal Service and Funding: SCOTUS Takes on Nondelegation, Major Questions, and DOGE

Escaping modern communication technology seems almost impossible in modern times[1]. However, some groups of people, such as the Luddite Club, have worked to make phones and smart technology less prevalent in our lives. Yet, the lack of humanity's ability to escape smart technically was intentional in many ways. With the Telecommunications Act of 1996, the internet grew both more widespread but also more regulated. The Telecommunications Act of 1996 built upon the original Communications Act of 1934, which initially addressed radio and telephone communications but later expanded to television broadcasting. However, the introduction of the internet led to a group of logistic problems. Many provisions were established to allow the act to follow its promises, with SCOTUS currently ruling upon Consumers’ Research v. Federal Communications Commission. This represents a long-standing precedent being placed into question. 

In the past, while the internet was not universal, it was also not considered fringe technology. What the internet required was a conceited and active effort to bring it into American homes. To share the wealth, the 1996 act included the Universal Service Fund. The fund is gathered as a tax upon telecommunications companies and is “money collected from telecommunications companies that is dedicated to fulfilling the goals of universal service” [2]. Especially as the internet has grown more prominent, the effects of the USF’s early work has become important in establishing the goals of the FCC. The USF’s goal now is to connect more broadband internet throughout more rural areas of the United States, but these efforts may be under attack by the Trump Administration. 

The program itself has been going off without much interference from its original goal since its creation in 1996, but a recent Fifth Circuit decision has changed this. The decision questioned where the funding for the Universal Service Fund came from. Seeing the Fifth Circuit ruling conservatively is not inherently shocking, as the Circuit consisting of the more right-leaning red states of Texas, Louisiana, and Mississippi. The Fifth Circuit ruled on the Consumers’ Research v. Federal Communications Commission case. Importantly, this case deals with the separation of powers between the FCC and their limits. The case alleges that because the USF does not have a cap on how much it can raise, the vague language implies more power onto the USF/FCC than safe for the balance of power. The Fifth Circuit's ruling dealt with two major questions. The two major questions are “Whether 47 U.S.C. § 254 [The Telecommunications Acts] violates the nondelegation doctrine by imposing no limit on the Federal Communications Commission’s power to raise revenue for the Universal Service Fund and (2) whether the FCC violated the private nondelegation doctrine by transferring its revenue-raising power to a private company run by industry interest groups” [3]. 

Written by Andy Oldman, the article reveals the contours of a conservative shift towards an interpretation of Article I: the nondelegation doctrine. According to the Legal Information Institute, the nondelegation doctrine states “that Congress cannot delegate its legislative powers or law making ability to other entities” [4]. As part of Article I, Section I, all legislative powers are granted into the legislative branch. However, the legislative branch often do not have the ability to regulate everything. Although they cannot delegate their powers of crafting legislation, it allows the allocation of power towards independent and administrative agencies to enforce the laws. Akin to common law, these end up setting forth precedent. In the petition for review, Congress’ failure to be specific with the amount raised puts the second question posed into frame. Congress never explicitly said how much money could be raised, as Oldman writes “Is a 25% excise tax excessively burdensome under §254(b)(1)? 250%? 2500%? There are no answers because Congress never gave them” [5]. Due to all of this, the ways in which the USF has been funded is now declared unconstitutional. 

This vagueness in the language and subsequent rulings encourage reading into the letter of the law and not into the spirit of it, but perhaps more importantly, requires originalism in the text. SCOTUS has only evoked the nondelegation doctrine twice, with both happening in 1935 [6]. Since then, SCOTUS has essentially declared that Congress holds significant power to delegate their powers in contention with the nondelegation doctrine. The main case cited for this is Mistretta v. United States, where Justice Harry Blackmun wrote, “in our increasingly complex society, replete with ever changing and more technical problems, Congress simply cannot do its job absent an ability to delegate power under broad general directives” [7]. Mistretta ruled that Congress could not delegate legislative powers but could obtain assistance from coordinate branches. However, this leads to questions about if the branches are co-ordinate. Consumer’s Research gives the judiciary power to shift what was originally given to Congress onto itself. Although SCOTUS has not always taken cases from the Fifth Circuit, the rulings here would negate the power of Congress in regulating telephone and internet rates. 

As the case has come up to SCOTUS, new questions are being asked for the highest court to decide on. The main question revolves around understanding the effect on constitutional law and “whether the combination of Congress’s conferral of authority on the FCC and the FCC’s delegation of administrative responsibilities to the administrator violates the nondelegation doctrine” [8]. Going back to the separation of powers doctrine, this argument relates back to the idea of being equal between the branches. The administrative power of the law is being placed directly against the constitutional principles which allowed the USF under Article I. These relate to the “major questions doctrine” in which the “Court may veto any action by a federal agency which five justices believe to be too politically or economically significant” [9]. If the Supreme Court sides with Consumers’ Research, executive agencies involved with regulating governmental funds would be placed into a much more advantageous point, with the constitutionality of their actions being affirmed by SCOTUS. Because Congress agencies would need to prove that their actions are in line with the nondelegation doctrine, they may be limited in the scope in which they can act as they skirt by clear boundaries; the consequence for not following this would be dismantling under the major questions doctrine. 

In the current political landscape, this manifests largely in Elon Musk’s Department of Government Efficiency. Musk’s partnership with Trump has been deeply discussed and heavily debated as legal scholars have attempted to grasp what this means for the coming years in American jurisprudence. As part of it, Musk and Trump’s goal has been routinely struck down by federal judges. SCOTUS's ruling, alongside the Fifth Circuit, would pave the way for the pair to enact their goals more aggressively. As Vox Senior Correspondent Ian Millhiser argues, earlier rulings have allowed SCOTUS to strike down individual agencies, but the Justices “could use Consumers’ Research to carpet bomb agencies’ authority, stripping them of any power to act in the future” [10]. 

Despite the Republican supermajority on the bench, there are some debates about how the Justices may rule. For starters, Oldman’s work has been seen as “sloppy”, primarily because of the letter of the law. Oftentimes, more conservative judges have taken issue with the broadness of the goals of laws. The USF/FCC clearly outlines their goals and jurisdiction in six points. The nondelegation doctrine applies to the funding, not to the actual actions. Due to this, the legal standing for the establish precedent is less firm. The second of these is that the USF is too detailed, as SCOTUS would need more than just broad purview to overturn it. Depending on their ruling, SCOTUS may pave the way for the Fifth Circuit to hold more influence over further decisions. What is certain is that the balance between administrative and constitutional law is once again, front and center. Arguments were on March 26th, 2025.

Sources:

1. Alex Vadukul, Luddite Teens Still Don’t Want Your Likes, (1/30/2025), https://www.nytimes.com/2025/01/30/style/luddite-teens-reunion.html.
2. Universal Service Administrative Company, Universal Service, https://www.usac.org/about/universal-service/#:~:text=The Universal Service Fund (USF,the Telecommunications Act of 1996. 
3. SCOTUSBlog, Federal Communications Commission v. Consumers' Research - SCOTUSblog, 2024, https://www.scotusblog.com/case-files/cases/federal-communications-commission-v-consumers-research/
4. Legal Information Institute, Nondelegation Doctrine, https://www.law.cornell.edu/wex/nondelegation_doctrine
5. Consumers' Research v. FCC, No. 22-60008 (5th Cir. 2023)
6. Ian Millhiser, How the Supreme Court put itself in charge of the executive branch (7/13/2023), https://www.vox.com/scotus/23791610/supreme-court-major-questions-doctrine-nebraska-biden-student-loans-gorsuch-barrett
7. Mistretta v. United States, 488 U.S. 361 (1989)
8. Supra [3]. 
9. Ian Millhiser, A new Supreme Court case seeks to revive one of the most dangerous ideas from the Great Depression (3/19/2025), https://www.vox.com/scotus/403650/supreme-court-fcc-consumers-research-nondelegation-andrew-oldham
10. Id.