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Tuesday, August 3, 2010

The Federal Communications Commission: Current Structure and Its Role in the Changing Telecommunications Landscape

Patricia Moloney Figliola
Specialist in Internet and Telecommunications Policy

The Federal Communications Commission (FCC) is an independent Federal agency with its five members appointed by the President, subject to confirmation by the Senate. It was established by the Communications Act of 1934 (1934 Act) and is charged with regulating interstate and international communications by radio, television, wire, satellite, and cable. The mission of the FCC is to ensure that the American people have available—at reasonable cost and without discrimination—rapid, efficient, nation- and world-wide communication services; whether by radio, television, wire, satellite, or cable.

Although the FCC has restructured over the past few years to better reflect the industry, it is still required to adhere to the statutory requirements of its governing legislation, the Communications Act of 1934. The 1934 Act requires the FCC to regulate the various industry sectors differently. Some policymakers have been critical of the FCC and the manner in which it regulates various sectors of the telecommunications industry—telephone, cable television, radio and television broadcasting, and some aspects of the Internet. These policymakers, including some in Congress, have long called for varying degrees and types of reform to the FCC. Most proposals fall into two categories: (1) procedural changes made within the FCC or through Congressional action that would affect the agency's operations or (2) substantive policy changes requiring Congressional action that would affect how the agency regulates different services and industry sectors. One bill has been introduced during the 111th Congress that would change the operation of the FCC. Representative Bart Stupak has introduced H.R. 4167, which would amend the Sunshine Act to allow more than two FCC commissioners to meet privately to discuss agency business, so long as a commissioner of each political party is present and the content of the meeting is publicly disclosed.

Most of the FCC's budget is derived from regulatory fees collected by the agency rather than through a direct appropriation. The fees, often referred to as "Section (9) fees," are collected from license holders and certain other entities (e.g., cable television systems) and deposited into an FCC account. The law gives the FCC authority to review the regulatory fees and to adjust the fees to reflect changes in its appropriation from year to year. It may also add, delete, or reclassify services under certain circumstances.

For FY2011, the FCC has requested a budget of $352,500,000 to carry out the FCC's functions and meet the expectations of Congress. This budget includes a direct appropriation of $1 million with the remainder to be collected through regulatory fees. The requested budget includes funding to support the Commission's cyber-security role; implement the National Broadband Plan; overhaul the Commission's data systems and processes; and modernize and reform the FCC by ushering in 21st century communications tools and expertise.

Date of Report: July 20, 2010
Number of Pages: 15
Order Number: RL32589
Price: $29.95

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