Supreme Court Decision on Universal Service Fund

On Friday, the Supreme Court delivered a 6-3 ruling in favor of a multi-billion-dollar grant program that finances phone and internet services for rural areas and schools. This decision dismissed claims from conservative groups arguing that Congress had excessively delegated authority in establishing the program.

The Universal Service Fund (USF), initiated in 1996, supports the Federal Communications Commission (FCC) in providing affordable “universal services” across the nation. It distributes approximately $8 billion annually to assist rural and low-income consumers, educational institutions, libraries, and healthcare facilities.

A study by conservative nonprofit groups highlighted concerns regarding how telecommunications companies were directed to contribute to the FCC, which relied on predictions from private companies about their revenues.

They contended that this dual-layered system breached constitutional principles by allowing Congress to delegate its legislative responsibilities to an administrative entity without clear guidelines.

Judge Elena Kagan, writing for the majority, asserted, “There is nothing in these arrangements that violate the Constitution separately or together.”

Justice Neil Gorsuch, along with Justices Clarence Thomas and Samuel Alito, expressed dissent.

Gorsuch noted, “As for other aspects of separation of power, we have found a manageable way of respecting the design of the Constitution, which does not require us.”

The ruling was seen as a setback for anti-regulation proponents who had hoped the case could pave the way for the Supreme Court to revisit legislative doctrines that hadn’t been examined in nearly a century.

Instead, the court sided with the federal government, upholding the USF program, which had backing from both the Biden administration and the Justice Department under Trump.

Support for the consumer research agenda came from various groups, including the Americans for Prosperity Foundation, associated with the Koch brothers, and conservative legal organizations advocating for freedom. Notably, the Cato Institute, a prominent libertarian think tank, was also involved.

In support of the USF, briefs were submitted by 22 bipartisan state attorneys general, public consumer advocacy groups, broadband organizations, and the American Library Association.