Section 202(h) of the Telecommunications Act of 1996: beware of intended consequences.

• Jurisdiction: United States
• Author: Schwartzman, Andrew Jay
• Date: 01 June 2006

1. INTRODUCTION II. JUDICIAL CONSTRUCTION OF SECTION 202(h) III. CONCLUSION I. INTRODUCTION

   This is a story about a reasonably obscure provision of the Telecommunications Act of 1996 ("I 996 Act"), and about the story behind the story. Sadly, it is a tale that demonstrates one of the pitfalls of undertaking comprehensive omnibus legislation.

   The notion of a comprehensive rewrite of the Communications Act of 1934 had--and still has--understandable appeal. Technology has advanced ever more quickly, and by the early 1990's it clearly had rendered many aspects of the Communications Act incomplete, archaic, and/or overbearing.

   However, it bears notice that the broad definitional scope of the Act--which created an independent Federal Communications Commission ("FCC") and empowered the FCC to regulate all interstate and foreign communication by wire or radio--worked very well and proved capable of adapting remarkably to changed circumstances. The FCC was able to deal with radar, lasers, microwave ovens, television, communications satellites, cable television, and countless other developments long before Congress adopted amendments specifically addressing them.

   However, there are costs as well as benefits from undertaking a top to bottom rewrite of the Communications Act. In particular such legislation inevitably becomes a vehicle for insertion of seemingly small, seemingly benign, provisions which can, in fact, effect significant changes in power relationships.

   The 1996 Act was generally regarded as a bill which created local telephone competition and which promoted competition between and among the cable and telephone industries. Contemporary press reports devoted scant attention to the broadcast ownership and digital television provisions in the statute. Few members of Congress other than members of the originating committees were likely aware of those aspects of the bill.

   When legislation is complicated and far reaching, it is inevitably the case that effective lobbyists can use it as a vehicle for amendments which are likely to go unnoticed and without discussion. Other affected parties, especially the general public, are usually left in the dark.

   Section 202(h) of the 1996 Act is one such amendment. (1) As originally enacted, it directed the FCC to subject its broadcast ownership rules to what amounted to non-stop scrutiny. (2) On its face, it simply calls on the FCC to conduct periodic reviews of its broadcast ownership rules. Section 202(h) reads as follows:

   Further Commission Review: The Commission shall review its rules adopted pursuant to this section and all of its ownership rules biennially as part of its regulatory reform review under section 11 of the Communications Act of 1934 and shall determine whether any of such rules are necessary in the public interest as the result of competition. The Commission shall repeal or modify any regulation it determines to be no longer in the public interest. (3) There is no legislative history explaining its origin or what Congress may have intended in adopting it. Nor could there have been any meaningful discussion of what its unidentified sponsors may have sought, or what the conference committee which adopted it might have thought, as Section 202(h) was not subject to any public discussion prior to its adoption. Indeed, for several years after enactment of the 1996 Act, no one would publicly claim credit for having anything to do with its drafting and enactment.

   Seven years after Section...