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86–393 2014

IMPROVING FCC PROCESS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON COMMUNICATIONS AND 

TECHNOLOGY 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

JULY 11, 2013 

Serial No. 113–69 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

(II) 

COMMITTEE ON ENERGY AND COMMERCE 

FRED UPTON, Michigan 

Chairman 

RALPH M. HALL, Texas 

JOE BARTON, Texas 

Chairman Emeritus 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOSEPH R. PITTS, Pennsylvania 

GREG WALDEN, Oregon 

LEE TERRY, Nebraska 

MIKE ROGERS, Michigan 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

Vice Chairman 

PHIL GINGREY, Georgia 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BILL CASSIDY, Louisiana 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

CORY GARDNER, Colorado 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Missouri 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

HENRY A. WAXMAN, California 

Ranking Member 

JOHN D. DINGELL, Michigan 

Chairman Emeritus 

EDWARD J. MARKEY, Massachusetts 

FRANK PALLONE, JR., New Jersey 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

JIM MATHESON, Utah 

G.K. BUTTERFIELD, North Carolina 

JOHN BARROW, Georgia 

DORIS O. MATSUI, California 

DONNA M. CHRISTENSEN, Virgin Islands 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

BRUCE L. BRALEY, Iowa 

PETER WELCH, Vermont 

BEN RAY LUJAN, New Mexico 

PAUL TONKO, New York 

(III) 

SUBCOMMITTEE ON COMMUNICATIONS AND TECHNOLOGY

GREG WALDEN, Oregon 

Chairman 

ROBERT E. LATTA, Ohio 

Vice Chairman 

JOHN SHIMKUS, Illinois 

LEE TERRY, Nebraska 

MIKE ROGERS, Michigan 

MARSHA BLACKBURN, Tennessee 

STEVE SCALISE, Louisiana 

LEONARD LANCE, New Jersey 

BRETT GUTHRIE, Kentucky 

CORY GARDNER, Colorado 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

JOE BARTON, Texas 

FRED UPTON, Michigan, ex officio 

ANNA G. ESHOO, California 

Ranking Member 

EDWARD J. MARKEY, Massachusetts 

MICHAEL F. DOYLE, Pennsylvania 

DORIS O. MATSUI, California 

BRUCE L. BRALEY, Iowa 

PETER WELCH, Vermont 

BEN RAY LUJAN, New Mexico 

JOHN D. DINGELL, Michigan 

FRANK PALLONE, JR., NEW JERSEY

BOBBY L. RUSH, Illinois 

DIANA DEGETTE, Colorado 

JIM MATHESON, Utah 

G.K. BUTTERFIELD, North Carolina 

HENRY A. WAXMAN, California, ex officio 

(V) 

C O N T E N T S 

Page 

Hon. Greg Walden, a Representative in Congress from the State of Oregon, 

opening statement ................................................................................................ 1 

Prepared statement .......................................................................................... 3 

Hon. Anna G. Eshoo, a Representative in Congress from the State of California, opening statement .................................................................................... 4 

Hon. Robert E. Latta, a Representative in Congress from the State of Ohio, 

opening statement ................................................................................................ 6 

Hon. Henry A. Waxman, a Representative in Congress from the State of 

California, opening statement ............................................................................. 7 

WITNESSES

Larry Downes, Internet Industry Analyst and Author ........................................ 10 

Prepared statement .......................................................................................... 12 

Answers to submitted questions ...................................................................... 137 

Richard J. Pierce, Jr., Lyle T. Alverson Professor of Law, George Washington 

University Law School ......................................................................................... 37 

Prepared statement .......................................................................................... 39 

Answers to submitted questions ...................................................................... 141 

Randolph J. May, President, Free State Foundation ........................................... 49 

Prepared statement .......................................................................................... 51 

Answers to submitted questions ...................................................................... 143 

James Bradford Ramsay, General Counsel, National Association of Regulatory 

Utility Commissioners ......................................................................................... 67 

Prepared statement .......................................................................................... 69 

Answers to submitted questions ...................................................................... 146 

Stuart M. Benjamin, Douglas B. Maggs Chair in Law and Associate Dean 

for Research, Duke University School of Law ................................................... 87 

Prepared statement .......................................................................................... 89 

Answers to submitted questions ...................................................................... 149 

Robert M. McDowell, Former FCC Commissioner and Visiting Fellow, Hudson 

Institute ................................................................................................................ 96 

Prepared statement .......................................................................................... 99 

Answers to submitted questions ...................................................................... 152 

SUBMITTED MATERIAL

Congressional Budget Office cost estimate dated March 19, 2012, submitted 

by Mr. Walden ...................................................................................................... 122 

Letters of support, submitted by Mr. Walden ....................................................... 124 

(1) 

IMPROVING FCC PROCESS 

THURSDAY, JULY 11, 2013 

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON COMMUNICATIONS AND TECHNOLOGY, COMMITTEE ON ENERGY AND COMMERCE, Washington, DC. 

The subcommittee met, pursuant to call, at 10:35 a.m., in room 

2123 of the Rayburn House Office Building, Hon. Greg Walden 

(chairman of the subcommittee) presiding. 

Present: Representatives Walden, Latta, Blackburn, Scalise, 

Lance, Kinzinger, Long, Ellmers, Barton, Eshoo, Dingell and Waxman (ex officio). 

Staff present: Ray Baum, Senior Policy Advisor/Director of Coalitions; Sean Bonyun, Communications Director; Matt Bravo, Professional Staff Member; Andy Duberstein, Deputy Press Secretary; 

Neil Fried, Chief Counsel, Communications and Technology; Kelsey 

Guyselman, Counsel, Telecom; Gib Mullan, Chief Counsel, Commerce, Manufacturing and Trade; David Redl, Counsel, Telecom; 

Charlotte Savercool, Executive Assistant, Legislative Clerk; Phil 

Barnett, Democratic Staff Director; Roger Sherman, Democratic 

Chief Counsel; Shawn Chang, Democratic Senior Counsel; Margaret McCarthy, Democrat Staff; Kara van Stralen, Democratic 

Policy Analyst; and Patrick Donovan, FCC Detailee. 

OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OREGON 

Mr. WALDEN. I will call to order the subcommittee on Communications and Technology and open our hearing on ‘‘Improving FCC 

Process Reform.’’ 

The communications industry is one of the few sectors still firing on all cylinders in this economy, averaging $80 billion a year in investment since 1996. It cannot continue to do so, however, if faced 

with poor FCC process. As Blair Levin, a previous FCC chief of 

staff and architect of the National Broadband Plan, has lamented, 

and I quote, ‘‘The FCC is becoming more of a political institution 

and less an expert agency.’’ 

Former Chairman Genachowski did make progress in reforming 

the Commission but there is more to do. The agency has fallen 

short in the past under both Democratic and Republican administrations. Without codification of certain protections, it will undoubtedly do so again. Only statute can ensure good process from the 

commission to the next commission. That is why we are discussing 

two draft bills today designed to minimize the potential for proceVerDate Nov 24 2008 12:47 Mar 04, 2014 Jkt 037690 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 113\113-69 CHRIS
2 

dural failings, to curb abuse, and to improve agency decision making. 

The FCC Process Reform Act passed the House as H.R. 3309 in 

the last Congress on a 247–174 bipartisan vote. Contrary to the assertions of some, it does not change the public interest test nor 

strip the FCC’s authority to protect consumers and competition. It 

merely asks the agency to do what we ask of most grade-school students: show your work, to publish the specific language of proposed 

rules, to identify a market failure or actual consumer harm, and 

conduct a cost-benefit analysis before regulating; to give commissioners, parties, and the public an adequate opportunity to review 

proposed rules; to publish the text of decisions promptly and examine whether adopted rules are meeting their purpose; to set ‘‘shot 

clocks’’ to ‘‘give the parties and the public more confidence that the 

agency is acting with dispatch,’’ as Commissioner Pai put it in his 

recent statement on the Softbank-Sprint-Clearwire transaction. 

Many of these ideas can be found in President Obama’s 2011 Executive Order on Improving Regulation and Regulatory Review, 

which binds executive branch agencies but, unfortunately, not to 

the FCC. And remember that in my state, public utility commissions already operate under much of what is proposed in this legislation. This is not unusual in America but it is in Washington. The 

draft bill also requires any transaction conditions to be narrowly 

tailored to transaction specific harms and otherwise within the 

FCC’s jurisdiction. This was in the bill before Mr. Wheeler was 

nominated as FCC Chairman, but his blog about the AT&T and T– 

Mobile merger reinforces the need. In it he notes that the Communications Act does not currently prohibit the FCC from, and I 

quote, ‘‘imposing merger terms and spectrum auction rules that 

might seem to be regulation in another guise.’’ This is precisely 

what the transaction review process should not be used for: backdoor rulemaking. 

Despite what you may hear, the bill does not dictate the outcome 

of a transaction review or alter the public-interest standard. The 

FCC can still find a proposed merger to be inconsistent and against 

the public interest and it can deny that transaction or adopt tailored conditions to remedy the specific condition. 

Now, some opponents argue implementing this bill would be difficult and will lead to litigation. Well, that is not true either. Most 

of the provisions rely on established definitions and accepted concepts under the Communications Act, the APA, and other law. And 

rather than micromanage the agency, the bill largely establishes 

principles and gives the FCC flexibility on how to implement them. 

I would nonetheless be happy to work with anyone who has a goodfaith interest in improving the language as we did leading up to 

the final version of the bill that passed the House. 

Others say it would be unwise to apply these types of reforms except government wide in the context of the Administrative Procedure Act. Well, that would be fine with me, but this committee 

doesn’t have that jurisdiction over the whole APA, and we need to 

start somewhere in Washington to reform government. Since the 

FCC oversees a huge and growing part of the economy, it seems a 

worthy candidate to commence the discussion. 

3 

Now, the second draft bill, the FCC Consolidated Reporting Act, 

passed the House as H.R. 3310 last Congress by voice vote. The 

legislation looks to relieve burdens on the agency and make its reports more meaningful. It does so by consolidating eight statutorily 

mandated reports into one biennial review and eliminates 12 outdated studies, like one on the telegraph industry. The existing reports are cumbersome and often unnecessary. A recent Government 

Accountability Office study on the video competition report, for example, concluded that the reports may not be needed on an annual 

basis, ‘‘especially given demand on FCC staff’s time for other monitoring and regulatory duties.’’ The proposed consolidated report will 

help break down siloed thinking and present a more useful picture 

of the marketplace upon which to base policy judgments. 

Now, I know there are some that have said there is no reason 

for this committee to spend its time on these efforts, and why 

would we take up these issues again when the Senate probably 

won’t agree. We are here to reform government. We are here to 

make changes. We are not here to defend the status quo. And if 

the United States Senate wants to continue to have the Federal 

Communications Commission do its telegraph report, well, fine 

with them, but that is not what we are about. The last thing that 

we want to do is stifle an industry that is continually growing and 

innovating. Yet that is exactly what could happen if the FCC is not 

held to certain standards of decision-making. The industry deserves 

an efficient and effective regulator we can truly call expert, just as 

the public deserves a transparent and accountable federal government, and these reforms are a good place to start. 

[The prepared statement of Mr. Walden follows:] 

PREPARED STATEMENT OF HON. GREG WALDEN

The communications industry is one of the few sectors still firing on all cylinders 

in this economy—averaging $80 billion a year in investment since 1996. It cannot 

continue to do so, however, if faced with poor FCC process. As Blair Levin, a previous FCC chief of staff and architect of the National Broadband Plan, has lamented, ‘‘[t]he FCC is becoming more of a political institution and less an expert 

agency.’’ 

Former Chairman Genachowski did make progress in reforming the Commission 

but there is more to do. The agency has fallen short in the past under both Democrat and Republican administrations. Without codification of certain protections, it 

will undoubtedly do so again. Only statute can ensure good process from commission 

to commission. That is why we are discussing two draft bills today designed to minimize the potential for procedural failings, curb abuse, and improve agency decision 

making. 

The FCC Process Reform Act passed the House as H.R. 3309 last Congress on a 

247–174 bipartisan vote. Contrary to the assertions of some, it does not change the 

‘‘public interest test’’ or strip the FCC’s authority to protect consumers and competition. It merely asks the agency to do what we ask of most grade-school studentsto show its work. To publish the specific language of proposed rules, identify a market failure or actual consumer harm, and conduct a cost-benefit analysis before regulating. To give commissioners, parties, and the public an adequate opportunity to 

review proposed rules. To publish the text of decisions promptly and examine 

whether adopted rules are meeting their purpose. To set ‘‘shot clocks’’ to ‘‘give the 

parties and the public more confidence that the agency is acting with dispatch,’’ as 

Commissioner Pai put it in his recent statement on the Softbank-Sprint-Clearwire 

transaction. Many of these ideas can be found in President Obama’s 2011 Executive 

Order on ‘‘Improving Regulation and Regulatory Review,’’ which binds executive 

branch agencies but, unfortunately, not to the FCC. 

The draft bill also requires any transaction conditions to be narrowly tailored to 

transaction specific harms and otherwise within the FCC’s jurisdiction. This was in 

4 

the bill before Mr. Wheeler was nominated for FCC Chairman, but his blog about 

the AT&T–T-Mobile merger reinforces the need. In it he notes that the Communications Act does not currently prohibit the FCC from ‘‘imposing merger terms and 

spectrum auction rules that might seem to be regulation in another guise.’’ This is 

precisely what the transaction review process should not be used for-back-door rulemaking. Despite what you may hear, the bill does not dictate the outcome of a 

transaction review or alter the public-interest standard. The FCC can still find a 

proposed merger to be against the public interest and deny the transaction or adopt 

tailored conditions to remedy specific concerns. 

Some opponents argue implementing this bill would be difficult and will lead to 

litigation. But it’s also not true. Most of the provisions rely on established definitions and accepted concepts under the Communications Act, the APA, and other 

law. And rather than micromanage the agency the bill largely establishes principles 

and gives the FCC flexibility on how to implement them. I’d nonetheless be happy 

to work with anyone who has a ‘‘good faith’’ interest in improving language. 

Others say it would be unwise to apply these types of reforms except government 

wide in the context of the Administrative Procedure Act. That would be fine with 

me. But this committee does not have jurisdiction over the APA and we need to 

start somewhere. Since the FCC oversees a huge and growing part of the economy, 

it seems a worthy candidate to commence the discussion. 

The second draft bill, the FCC Consolidated Reporting Act, passed the House as 

H.R. 3310 last Congress by voice vote. The legislation looks to relieve burdens on 

the agency and make its reports more meaningful. It does so by consolidating eight 

statutorily mandate reports into one biennial report and eliminating 12 outdated 

studies, like one on the telegraph industry. The existing reports are cumbersome 

and often unnecessary. A recent GAO study on the video competition report, for example, concluded that the reports may not be needed on an annual basis, ‘‘especially 

given demand on FCC staff’s time for other monitoring and regulatory duties.’’ The 

proposed consolidated report will help break down siloed thinking and present a 

more useful picture of the marketplace upon which to base policy judgments. 

The last thing that we want to do is stifle an industry that is continually growing 

and innovating. Yet that is exactly what could happen if the FCC is not held to certain standards of decision-making. The industry deserves an efficient and effective 

regulator we can truly call ‘‘expert,’’ just as the public deserves a transparent and 

accountable federal government. These reforms are a good place to start. 

# # # 

Mr. WALDEN. With that, I would yield back the balance of my 

overused time and recognize my friend from California, Ms. Eshoo 

for an opening statement. 

OPENING STATEMENT OF HON. ANNA G. ESHOO, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Ms. ESHOO. Thank you, Mr. Chairman, and good morning to you, 

and welcome to all of the witnesses. Former Commissioner 

McDowell, it is always a pleasure to see you and have you with us. 

Just 2 weeks ago, Mr. Chairman, we had bipartisan consensus 

on the need to focus on how federal agencies use spectrum. Today, 

we are returning to legislation that this subcommittee has debated 

for 3 straight years. It hasn’t nor in my opinion will it go anywhere. Administrative law experts tell us it would tie the FCC up 

in years of litigation, and I think it really contains some policies 

that are not good policies. This proposed process reform, in my 

view, is a back-door way of gutting some of the FCC’s very important authorities. 

Congress created the FCC to safeguard the public interest. Big 

corporations, as we know, are well equipped to advance their private interests, and they have every right to do so, but consumers 

5 

need advocates and competitors and innovators need a referee to 

level the playing field. 

As we all know, the FCC faces an enormous set of challenges in 

the coming years including the upcoming voluntary spectrum auction, the transition to IP and the modernization of the e-rate program in our Nation’s schools and libraries. Our role as a subcommittee, I think, should be to ensure that the agency is equipped 

with the tools to meet these challenges while ensuring that the 

FCC can continue to protect the public interest and preserve competition. I am going to repeat that: preserve competition in the 

communications marketplace. If we really want to accomplish 

meaningful reform, I think we should start with a proposal that enjoys nearly universal support including that of the acting chairwoman of the FCC, Commissioners Pai and Rosenworcel, and 

former FCC Commissioners Abernathy, Copps, and McDowell. 

The FCC Collaboration Act of 2013, H.R. 539, is bipartisan, it is 

bicameral, and it will allow FCC commissioners to more easily collaborate with one another outside of public meetings. As the FCC 

increasingly responds to complex, highly technical issues, I think 

now is the time to get this legislation passed and signed into law. 

We just shouldn’t delay anymore. It is really a source of embarrassment. Everyone is for it. We can get it done. 

Secondly, I support allowing commissioners to appoint the electrical engineer or computer scientist to their staff that some of 

them have asked for. This is a bipartisan proposal offered in the 

last Congress by former Representative Stearns. 

Third, I support the creation of an online searchable database of 

consumer complaints, an idea advanced by the ranking member of 

the full committee, Mr. Waxman, in the previous Congress, and finally, I agree that there could be opportunities to streamline many 

of the reporting requirements that Congress has placed on the 

FCC. We are now in the seventh month of the 113th Congress, but 

only one bill has moved through our subcommittee. Instead of 

working on legislation that creates billable hours for Washington 

telecom lawyers, I think that we need to work together to craft 

policies that are actually going to move, that will create jobs for 

innovators, promote investment in infrastructure across our country, and technological advances that will help American families. 

So I thank each of our witnesses that are here today. I know that 

we tried to get some of the opposite sex to show up. I know that 

they are alive and well out there, but for one reason or another, 

they couldn’t, but I want, if the public is listening in, not to think 

that we have overlooked that, and again, I want to thank you for 

working with our subcommittee to help drive competition, promote 

innovation and protect consumers. 

And with that, I will yield back the balance of my time, Mr. 

Chairman. 

Mr. WALDEN. I thank the gentlelady, and I am going to ask for 

a moment of personal privilege now to acknowledge the service of 

our committee chief counsel, Neil Fried, who will be leaving the 

subcommittee soon to work for the Motion Picture Association of 

America. Neil has rendered outstanding service to this subcommittee for 10 years. He served as subcommittee counsel under 

full committee Chairmen Townsend, Barton and Upton, and subVerDate Nov 24 2008 12:47 Mar 04, 2014 Jkt 037690 PO 00000 Frm 00011 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 113\113-69 CHRIS
6 

committee Chairmen Upton, Stearns and myself. He has been part 

of rewriting the Satellite Home Viewer Act so many times that 

well, he is going to avoid it this time, I think. Three times he has 

been there to help rewrite the Home Viewer Act. As a legislative 

rock star for the committee, his knowledge and expertise will be 

missed, but I know he will become a legal movie star for the 

MPAA. Neil, thank you for your service to this committee and to 

this country. I would have hoped on his final day here we would 

have him actually at the witness stand so we could have him under 

oath. 

I thank the committee for that indulgence, and now I would recognize the vice chair of the committee, Mr. Latta, for 5 minutes. 

OPENING STATEMENT OF HON. ROBERT E. LATTA, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF OHIO 

Mr. LATTA. Well, thank you, Mr. Chairman, and I will not take 

my 5 minutes, but I want to thank you for holding this hearing on 

‘‘Improving the FCC Process’’, and I appreciate our witnesses for 

being here today. I really appreciate that. 

The cost of regulation to American businesses and hence our 

economy is too great to ignore. Regulatory burden is the number 

one issue I hear from everyone that I visit in my district, and it 

is amazing when you have all the different issues out there, the 

number one issue from everyone, and I have done 250 visits in my 

district of factories and businesses since the last August work period, it is regulations. 

Unfortunately, these job creators, many of them small businesses, are holding back from doing what they do best, and that 

is driving the economy and actually creating jobs, in part because 

of the burdensome regulations that are imposed. 

I have reintroduced my FCC ABCs Act from last Congress requiring the FCC to perform cost-benefit analysis on economically 

significant rules, and I appreciate the chairman including this idea 

in his discussion draft. Additionally, my bill would also reform the 

Commission’s forbearance authority and biennial review of regulations by adding an evidentiary presumption in order to empower 

the FCC to arrive at more deregulatory decisions. 

With the telecommunications industry driving a significant portion of the economic growth in our country, as Members of Congress, we should make sure that the FCC does not produce regulations that will hamper this sector of the economy, and again, Mr. 

Chairman, I thank you and I yield back the balance of my time. 

Mr. WALDEN. The gentleman, I think, wants to actually yield to 

the gentleman from Texas, Mr. Barton—— 

Mr. LATTA. I am sorry, and I yield to Mr. Barton. 

Mr. WALDEN [continuing]. For such time as he may consume. 

Mr. BARTON. I thank the gentleman from Ohio. 

I think it is about time that Neil got a real job. We wish him 

well. Honestly, he is a great guy. 

Mr. Chairman, I have introduced FCC reform legislation in the 

last three Congresses, two Congresses ago, as the ranking member 

in the minority and last Congress with a subcommittee Chairman 

Stearns, and of course, I am happy to be on these two bills today. 

7 

I seldom disagree very strongly with the ranking minority subcommittee leader, Ms. Eshoo, on too many issues, but I do disagree 

with her on this. I fail to see how more openness and transparency, 

which is primarily what these two bills do—I mean, there are other 

things in the bills—but it is basically an attempt to get more certainty in the rulemaking process and more openness and transparency so that the stakeholders can understand what the commissioner at the FCC are doing. I don’t see that as a negative. I see 

that as a positive. 

So as you pointed out in your opening statement, Mr. Chairman, 

one of these bills passed the House and maybe both of them in the 

last Congress, so maybe this is the year of the Congress that we 

actually get it through the Senate and the President signs it. If you 

look at what has happened at NSA and you look at what is happening with the IRS and you look at what has happened at the 

Justice Department, I would think those that are interacting with 

the FCC would want bills like these two because I think they are 

much better for the American people if we modernize and make 

more transparent their actions. 

With that, I will yield to somebody else or yield back my time. 

Mr. WALDEN. I think Ms. Blackburn had requested—— 

Mr. BARTON. I will yield to the gentlelady from Tennessee. 

Mrs. BLACKBURN. Thank you so much, and I want to welcome 

our panel because we are appreciative that you would take your 

time and be with us. 

And Mr. Chairman, I want to thank you for so diligently pursuing FCC reforms. It is needed. I will tell you, only in Washington, D.C., does it seem to be acceptable for federal agencies to 

be careless or reckless or unaccountable for taxpayer dollars or to 

oppose reforms or efficiencies or ways that are going to allow the 

customers, the end users to be better served. So I do look forward 

to this. 

We have all heard and have grown weary, it seems like there is 

a scandal and misuse of taxpayer funds every week, whether it is 

the IRS or Department of Labor or Department of Justice. The list 

goes on and on—EPA. So putting this issue forward is appropriate, 

it is timely, and we appreciate that you all would be here to give 

us your best thoughts and recommendations, and I yield back. 

Mr. WALDEN. The gentlelady yields back. All time is expired on 

our side. We will turn now to the gentleman from California, Mr. 

Waxman, for an opening statement. 

OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Mr. WAXMAN. Thank you, Mr. Chairman. I want to begin by also 

thanking Neil Fried for his service on this committee, and I wish 

him well in his new position. I hope at the MPAA he will have occasion to visit my district more often and understand the problems 

of real people. 

Mr. WALDEN. You two can travel together. 

Mr. WAXMAN. Today the subcommittee revisits a topic that deeply divided our committee last Congress: the so-called FCC process 

reform. Supporters of this legislation assert that this bill will make 

8 

the Federal Communications Commission more transparent and efficient. From our perspective, it is transparent that this legislation 

is an effort to undermine the agency’s ability to adopt new rules, 

protect consumers, and promote competition, and the only efficiency gained is the speed with which communications lawyers 

could find new ways to take the FCC to court. 

The bill circulated by Chairman Walden earlier this week includes the same defects as the legislation from last Congress. It 

still undermines the ability of the FCC to act quickly and efficiently by putting in statute a dozen new mandatory process requirements, with each one subjecting the FCC to new court challenges. And it still alters fundamentally the agency’s authority to 

impose conditions during its transaction review process, effectively 

eviscerating the public-interest standard that has guided the FCC 

for nearly 80 years. 

The red tape created by this legislation is astounding. The Congressional Budget Office estimated that implementing the legislation from last Congress would require 20 additional staff positions 

at the FCC and cost the agency millions of dollars every year. I 

don’t see that there is an abundance of extra funds to devote to this 

purpose. And the updated draft is even worse than last year’s bill. 

It contains new provisions that would further incapacitate the 

agency. 

Ranking Member Eshoo and I asked committee staff to consult 

with administrative and communications law experts to understand the impacts of the legislation. The overwhelming consensus 

from the independent experts we spoke with was that adoption of 

this legislation would be a serious mistake that would slow the 

FCC to a crawl. They told us that the FCC-specific mandates in 

this bill would remove the Commission from the well-established 

precedents of the Administrative Procedure Act, which could lead 

to decades of litigation and breed uncertainty and confusion. The 

agency would be tied up in knots and unable to do much of anything except report to Congress on its adherence to deadlines. 

I am pleased we will be able to hear from two of these experts 

today: Professor Richard Pierce of the G.W. Law School and Professor Stuart Benjamin from Duke Law School. Professor Pierce is 

one of the leading authorities on administrative law in the nation. 

He literally wrote the textbook on this topic. Professor Benjamin 

brings to us a unique perspective as an expert in both telecommunications law and administrative law who has spent time 

working at the FCC as a Distinguished Scholar. I also welcome 

back to the Committee Mr. McDowell, Mr. May, and Mr. Ramsay. 

Let me reiterate what I hope is obvious. Democrats are open to 

improving federal agency operations and efficiency, and the FCC is 

no exception. We proposed several reforms last Congress and will 

do so again this Congress. If there are sensible ways to make the 

agency more efficient and nimble, we should join together to do so. 

But we seriously disagree about the wisdom of the current effort, 

and I hope the majority will reconsider its plans to push this 

through the House. We do far too many message bills that go nowhere in the Senate. 

We have a real opportunity to enact meaningful bipartisan legislation that modernizes our communications and technology laws 

9 

but every day we spend arguing over this bill, which is going nowhere fast, is another missed opportunity. 

Thank you, Mr. Chairman. 

Mr. WALDEN. Will the gentleman yield for just a second on the 

APA issue? 

Mr. WAXMAN. Yes. 

Mr. WALDEN. Because if you look at the last section of the draft 

bill, we don’t change anything on APA except for the Sunshine Act, 

that you all support. Just as a matter of clarification, nowhere else 

in the Act do we change the APA directly. It is only the Sunshine 

Act. 

Mr. WAXMAN. Well, Mr. Chairman, I will be pleased to listen to 

what the witnesses, who are suggests in this area, have to think 

about what changes there are in the APA. This would be a serious 

matter, and I seem to sense that you think it is serious as well. 

Mr. WALDEN. I would just direct you to line 5, page 25, section 

6, effect on other laws: ‘‘Nothing in the Act or the amendment 

made by this Act shall relieve the FCC from any obligations under 

Title V, U.S.C. Code, except where otherwise expressly provided,’’ 

and that is the Sunshine Act. 

Mr. WAXMAN. Mr. Chairman, reclaiming my time, as I understand it, it removes the Administrative Procedure Act from the 

FCC and creates another set of laws under which it would operate 

that is similar to the Administrative Procedures Act but is different, and I want to get that point clarified in this hearing. I think 

this is why we have hearings. 

Mr. WALDEN. That is exactly why we have hearings, and even for 

bills that go forward. 

Let me suggest that we have 11 minutes left in the vote, so rather than start with one person’s testimony, I would recommend that 

we recess the committee now until after votes. So I know you are 

all poised and ready to go, and we appreciate it, but I think it is 

probably best for the flow of the testimony that we recess until we 

return from votes immediately. Thank you. 

[Recess.] 

Mr. WALDEN. If we could have everybody take their seats, we are 

going to restart the hearing and hear from our witnesses. I apologize for the delay, and they do expect votes again right around 

noon, so hopefully we can at least get through the statements of 

our distinguished panel members, and we will start off with Mr. 

Downes, who is an Internet industry analyst and author, and we 

welcome you to the Subcommittee on Communications and Technology, and go ahead and turn that mic on, pull it up close, and 

we look forward to your testimony on this matter. Thank you, sir. 

10 

STATEMENTS OF LARRY DOWNES, INTERNET INDUSTRY ANALYST AND AUTHOR; RICHARD J. PIERCE, JR., LYLE T. 

ALVERSON PROFESSOR OF LAW, GEORGE WASHINGTON UNIVERSITY LAW SCHOOL; RANDOLPH J. MAY, PRESIDENT, 

FREE STATE FOUNDATION; JAMES BRADFORD RAMSAY, 

GENERAL COUNSEL, NATIONAL ASSOCIATION OF REGULATORY UTILITY COMMISSIONERS; STUART M. BENJAMIN, 

DOUGLAS B. MAGGS CHAIR IN LAW AND ASSOCIATE DEAN 

FOR RESEARCH, DUKE UNIVERSITY SCHOOL OF LAW; AND 

ROBERT M. MCDOWELL, FORMER FCC COMMISSIONER AND 

VISITING FELLOW, HUDSON INSTITUTE 

STATEMENT OF LARRY DOWNES 

Mr. DOWNES. Well, thank you, Mr. Chairman and Ranking Member Eshoo and members of the subcommittee. I appreciate the opportunity to testify today on the importance of reforming processes 

at the FCC. My name is Larry Downes. I am based in Silicon Valley. I am an Internet industry analyst and the author of several 

books on the information economy, innovation and the impact of 

regulation. I have also written extensively on the impact of communication policy on the dynamic broadband ecosystem and in particular the role played by the FCC. 

As the nature technological innovation has both accelerated and 

mutated in the last decade in particular, the FCC’s inability to 

eliminate needless roadblocks for consumers, entrepreneurs and incumbents alike has reached a breaking point. The agency continues 

to tinker with a 21st century communications ecosystem using a 

19th century toolkit. Many of the FCC’s processes are badly in 

need of reform and structure. They lack economic rigor, transparency, expediency and consistency. 

As Nobel Prize-winning Ronald Coase famously wrote, ‘‘If you 

torture the data long enough, nature will always confess.’’ That, in 

a nutshell, has become the FCC’s unintended modus operandi. The 

agency collects the data it needs to make wise and efficient decisions, but in the absence of clear guidelines and the most basic economic tools, the Commission cannot resist the urge to abandon the 

logical conclusions compelled by their own data in the service of 

vague, idiosyncratic, transient and, often, unarticulated policy 

goals. 

These problems devalue much of the good work of the agency’s 

staff and subvert the often admirable goals of the FCC’s Chairmen 

and Commissioners. They have created an epidemic of side effects, 

including reports that fail to reach obvious conclusions supported 

by the thorough data collection the staff performs, limiting their 

usefulness as policy tools to advance the FCC’s longstanding charter to promote communications to all Americans; rulemakings that 

torture their analysis and data to justify what appear at least to 

be ex ante conclusions to regulate regardless of the need or cost; 

painfully slow reviews of license transfers aimed at avoiding an imminent spectrum crisis which when approved are rendered incoherent by laundry lists of unrelated conditions, many of which become 

counterproductive or mooted by technological advances years before 

they expire. In approving the Comcast-NBC University merger, for 

example, which took the FCC nearly a year, the agency imposed 30 

11 

pages of conditions including a requirement to run certain commercials on certain channels at certain times for a period of 5 years; 

and finally, past and now future spectrum auctions poisoned by 

similar interventions weighed down with so many strings attached, 

they either fail to achieve minimum bids or leave billions of dollars 

on the table. 

Given rapid changes in the broadband ecosystem, the FCC needs 

some measure of flexibility to complete its statutory mission. But 

applying that flexibility ungrounded by neutral principles, guidelines and analytic processes invariably does more harm than good. 

Worse, the lack of structure has left the FCC with the mistaken 

impression that the agency can predict an increasingly unpredictable future and design what it calls prophylactic remedies for consumer harms that have yet to occur. 

In effect, the Commission’s decision-making process is at war 

with the agency’s own data. Congress can easily ameliorate the 

worst symptoms of this breakdown. The two discussion draft bills 

before you provide many commonsense, modest, apolitical repairs 

imposing needed structure on the FCC’s processes. 

As those of us in the technology industry have learned the hard 

way, the pace of change has long since outrun our ability to predict 

the future even in the short term. The FCC must be cured of its 

addiction to micromanaging markets that are evolving even as the 

Commission’s deliberations meander along, and it must focus its remedial and regulatory efforts on relevant consumer harms that are 

tangible and solvable with both precision and measurable efficacy. 

That minimal level of regulatory process has been mandatory for 

executive agencies since President Clinton ordered it in 1993, an 

order amplified by President Obama in 2011. President Obama also 

made clear he expected though he could not require the same basic 

tools be applied as a matter of course by independent regulatory 

agencies including the FCC. Indeed, most independent regulatory 

agencies, according to a recent longitudinal survey by the Administrative Conference of the United States are already required by law 

to conduct some level of cost-benefit analysis. The FCC is one of 

the very few who do not have such mandates in their implementing 

statutes, and perhaps the only agency that doesn’t do it anyway. 

There is also nothing novel or difficult about the added requirement the FCC consider as an alternative to specific interventions 

the possibility that high-tech markets will cure their own ills more 

quickly and efficiently and with fewer unintended side effects. That 

was, for example, precisely the approach taken by the Department 

of Justice in its separate review of the Sirius-XM satellite radio 

merger. In a 4-page statement closing its review, the Antitrust Division sensibly found that new forms of competition driven by 

emerging Internet technologies would be more than adequate to 

discipline the combined entity, and they have been proven abundantly correct. By contrast, it took the FCC 17 months and a 100- 

plus-page order laden with conditions to reach the same conclusion. 

Thank you for the invitation to appear today. I look forward to 

your questions. 

[The prepared statement of Mr. Downes follows:] 

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Mr. WALDEN. Mr. Downes, we appreciate your testimony. 

We will go now to Mr. Richard J. Pierce, Jr., Lyle T. Alverson 

Professor of Law at the George Washington University Law School. 

Mr. Pierce, thank you for being here today, and we look forward 

to your testimony, sir. 

STATEMENT OF RICHARD J. PIERCE, JR. 

Mr. PIERCE. Thank you, Chairman Walden, Ranking Member 

Eshoo and members of the subcommittee. It is a privilege for me 

to be able to appear before you today to discuss the proposed Federal Communications Commission Reform Act of 2013. 

I have taught administrative law for 36 years. I have written 

over a dozen books and 120 scholarly articles on administrative 

law. My books and articles have been cited in hundreds of judicial 

opinions including over a dozen opinions of the United States Supreme Court. I am also a member of the Administrative Conference 

of the United States. 

I will discuss the provisions of the proposed Act that relate to the 

procedures the Federal Communications Commission is required to 

use to issue rules. I will not discuss the provisions that relate to 

the substantive principles the FCC is required to apply in its decision-making. I am not an expert on communications law, so I lack 

an adequate basis to discuss proposed changes in the substance of 

communications law. 

The proposed FCC Process Reform Act would add 12 judicially 

enforced mandatory steps to the notice and comment rulemaking 

procedure required by Section 553 of the Administrative Procedure 

Act. Those new mandatory, judicially enforced steps are: a minimum 30-day period for submitting comments; a minimum 30-day 

period for submitting reply comments; a mandatory notice of inquiry issued within 3 years of the issuance of the notice of proposed 

rulemaking; mandatory inclusion of the language of the proposed 

rule in the notice of proposed rulemaking; an identification of the 

specific market failure the proposed rule addresses; a determination that the benefits of the proposed rule exceed its costs; a determination that market forces or changes in technology are unlikely 

to address the specific market failure addressed by the rule; advanced provision of a list of the available alternative options to all 

Commissioners, provision of the language of the proposed rule to 

all Commissioners well in advance of any meeting scheduled to 

consider a proposed rule; publication of the text of the proposed 

rule in advance of the meeting; adoption of performance measures 

for any program activity created or amended by the rule, and a 

finding that such performance measures will be effective to evaluate the activity created or amended by the rule. 

None of these procedures are in the Administrative Procedure 

Act. Every one of them is an add-on to the procedures in the APA. 

In my opinion, the proposed Act would not improve the FCC decision-making procedure. As I explain in greater detail in my written 

testimony, the proposed Act would have two serious adverse effects. 

First, it would be a significant departure from the wise decision 

Congress made in 1946. After 15 years of debate and an unprecedented amount of empirical research, Congress unanimously enacted Section 553 of the Administrative Procedure Act. That statuVerDate Nov 24 2008 12:47 Mar 04, 2014 Jkt 037690 PO 00000 Frm 00043 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 113\113-69 CHRIS
38 

tory provision creates a uniform set of procedures that all agencies 

are required to use when they issue rules. 

The APA was one of the most thoroughly debated and carefully 

researched statutes ever enacted. It was premised on the belief 

that creation of a uniform set of procedures applicable to all agency 

rulemaking was critically important to the Nation. The Supreme 

Court has spent the last 67 years resisting the periodic attempts 

to return to the confusing, uncertain and ad hoc world that preceded the passage of the Administrative Procedure Act, yet that is 

exactly what this bill would do. It would move us back in that direction. 

Second, it is a bad idea to add 12 mandatory, judicially enforced 

procedures to a process that is already long and resource intensive. 

The proposed Act would add many additional procedures to the 

FCC rulemaking process, so many mandatory procedures that the 

agency would be able to issue, amend or rescind few, if any, rules. 

It would slow down the decision-making process dramatically. That 

is exactly the opposite of what you want to happen in a highly volatile market like telecommunications. As I discuss in detail in my 

written testimony, great jurists like Chief Justice Rehnquist and 

D.C. Circuit Judge Cavanaugh have urged rejection of similar efforts to impose such burdens on the rulemaking process. 

That concludes my testimony. I would be glad to answer any 

questions you might have. 

[The prepared statement of Mr. Pierce follows:] 

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Mr. WALDEN. I appreciate your testimony, Mr. Pierce, and we 

will now move to Randolph J. May, who is the President of the 

Free State Foundation. 

Mr. May, thanks for being here today. We look forward to your 

comments. 

STATEMENT OF RANDOLPH J. MAY 

Mr. MAY. Thank you, Mr. Chairman. I would like to borrow Professor Pierce’s booming voice for my testimony. 

Chairman Walden, Ranking Member Eshoo and members of the 

committee, again, thank you for inviting me to testify today. I am 

President of the Free State Foundation, a nonprofit research and 

educational foundation. FSF is a think tank that focuses its work 

primarily in the communications law and policy and administrative 

law areas. I have been involved for 35 years in communications 

policy in various capacities including having served as Associate 

General Counsel at the FCC. I am a past chair of the American 

Bar Association’s section of administrative law, and I am a public 

member of the Administrative Conference of the United States. So 

today’s hearing on FCC process reform is at the core of my longstanding experience and expertise in communications law and policy and administrative law. 

I appreciated the opportunity to testify before this committee a 

bit more than 2 years ago. Though H.R. 3309 and 3310 both passed 

the House, unfortunately they died in the Senate. Reform measures 

such as those embodied in the present discussion drafts are needed 

now more than ever. In my June 2011 testimony, I generally supposed the proposed reforms, and I do so again today because the 

FCC’s decision-making needs to change so that in today’s generally 

dynamic competitive telecommunications marketplace, the agency 

will be less prone to continue on its course of too often defaulting 

to regulatory solutions even when there is no convincing evidence 

of market failure or consumer harm. 

The FCC still operates today with a pro-regulatory proclivity 

pretty much as it did in 1999 when the Clinton Administration’s 

FCC Chairman Kennard called for the reorientation of the agency’s 

mission to account for the increasingly competitive environment 

evident even then. After having served at the FCC from 1978 

through 1981, when President Carter’s FCC chairman was initiating efforts to reduce regulation in light of the new forms of competition already emerging then, I believe that regulatory reform 

measures like those embodied in the discussion drafts and the few 

additional ones that I advocate in my testimony deserve bipartisan 

support. 

In the time that I have, without taking anything away from the 

significance of some of the other proposed reforms, I want to highlight the rulemaking requirements and transaction review proposals because they are especially important. It is true, of course, 

that as some of the bill’s opponents charge, new Section 13(a) 

would require the FCC to make additional findings and undertake 

additional analysis beyond that presently required before it imposes new rules. For example, the FCC would be required to analyze whether there is a market failure, and it would be required 

to perform a cost-benefit analysis, and the Commission would be 

50 

required to provide a reasoned explanation as to why market forces 

and technology changes will not within a reasonable time period resolve the agency’s concerns. Frankly, in today’s communications environment, you would hope the FCC would be doing these things 

anyway, but the reality is, that it often doesn’t. There is nothing 

inherent in sound principles of administrative law that suggests 

Congress should not impose particular sector-specific analytical decision-making requirements when circumstances warrant. While 

general theories of administrative law are nice and can be relevant, 

in general they are not necessarily applicable to a specific marketplace sector or regulator, and this is especially true in this particular marketplace sector, which due largely to rapid changes in 

technology is generally competitive. 

Indeed, I urge the committee to go a step further by specifying 

that the reasoned determination required concerning whether market forces or changes in technology are unlikely to resolve the Commission’s concern must be based on clear and convincing evidence. 

This change will not prevent the Commission from adopting new 

regulations, and it is not intended to do so. It simply requires the 

agency to meet an evidentiary burden before adopting or revising 

regulations. 

The transaction review provisions contained in Section 13(k), especially the addition that allows the Commission the conditional 

approval of a proposed transaction only if the condition addresses 

a likely harm uniquely presented by the specific transaction would 

go a long way towards combating the FCC’s abuse of the transaction review process. The agency often has abused the process by 

delaying approval of transactions until the applicants ‘‘voluntarily’’ 

agree, usually at the midnight hour, to conditions that are not narrowly tailored to remedy a harm arising from the transaction or 

unique to it. 

I also suggest the committee reform the forbearance and periodic 

regulatory review process by in effect requiring a higher evidentiary burden to maintain existing regulations on the books. Actually, I understand from what Representative Latta said that 

maybe he agrees with that. Absent clear and convincing evidence 

that the regulations at issue should be retained under the existing 

substantive statutory criteria, regulatory relief should be granted. 

Similarly, I propose adoption of a sunset requirement so that all 

rules will automatically expire after X years absent a showing 

based on clear and convincing evidence that it is necessary for such 

a rule to remain in effect to accomplish its original objective. 

Again, thank you for inviting me to testify today. I will be 

pleased to answer your questions. 

[The prepared statement of Mr. May follows:] 

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Mr. WALDEN. Thank you, Mr. May. We appreciate your participation in our hearing. 

We now turn to James Bradford Ramsay, who is General Counsel for the National Association of Regulatory Utility Commissioners. Mr. Ramsay, thank you for being here. We look forward to 

hearing from NARUC. 

STATEMENT OF JAMES BRADFORD RAMSAY 

Mr. RAMSAY. Thank you so much, Chairman Walden and Ranking Member Eshoo, for inviting me and giving me the privilege of 

testifying today. 

I am enthusiastic that there is again a focus on reform at the 

FCC. I guess I wanted to say since I am hearing the perspective, 

everybody is telling where they are coming from, I am coming from 

the perspective of a 23-year practitioner before the agency who actually has to deal with these procedures on a daily basis, and I am 

representing a group of people who are directly impacted by these 

procedures daily: the tate public utility commissions in all 50 

states, each one of your tates. 

In my 23 years at NARUC, I have had the privilege of working 

with nine—the privilege and sometimes the frustration of working 

with nine different FCC chairs. I started with Al Sikes was chair, 

and of course, I am here for Mignon Clyburn, my really good friend. 

And without exception, I think they have all been dedicated public 

servants, really trying to do what they thought was in the best interest of the country. Mignon, when she came up here, Chairman 

Clyburn when she came up here before her confirmation as FCC 

chair, I was talking to her at the NARUC offices, and she just 

looked up, and we were talking about the confirmation hearing 

process. She said no, I don’t really care about all this, Brad, I just 

want to do the right thing. And I think that is what all FCC Commissioners try to do. I think the staff over at the FCC is among 

the most professional and hardworking of all of the federal agencies that I deal with here in Washington, but that doesn’t mean 

that there aren’t process abuses at the FCC, and the process 

abuses, it also doesn’t mean that Congress shouldn’t be looking at 

some ways to correct the process abuses at the FCC. There have 

been process abuses at the FCC every year that I practiced before 

the agency before both Democratic and Republican Administrations. There have been problems, problems that unnecessarily increase cost to taxpayers—that is your constituents—problems that 

increase the regulatory risk unnecessarily for FCC policy pronouncements to be overturned on process issues that we shouldn’t 

even be talking about, problems that directly undermine rationale 

decision making. I mean, if you look at some of the provisions in 

this bill, they are designed to make sure that the other FCC Commissioners have adequate time to look at the record and consider 

things that are put in the record later in the process before they 

make their decision. Those provisions I think are useful. 

There are also problems I think that the discussion draft will actually go a long way towards correcting, or at least certain provisions in the discussion draft. Is that draft perfect? There is no such 

thing as a perfect piece of legislation coming out of Congress, but 

there are some pieces and, you know, NARUC endorses very speVerDate Nov 24 2008 12:47 Mar 04, 2014 Jkt 037690 PO 00000 Frm 00073 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 113\113-69 CHRIS
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cifically certain aspects of this legislation. It provides a good framework from NARUC’s perspective for bipartisan action going forward at FCC that are in there that are supported by both sides. 

I think it is worth pointing out here that like the committee and 

Congress, NARUC is bipartisan. The people that I represent, unlike the other witnesses on this panel, are in-state experts whose 

interests align precisely with each representative in this room. 

These are commissioners that reside and work in your state, and 

there is not another stakeholder in the telecommunications sector 

that cares more about what happens to the infrastructure in your 

state and to the services and your state and the impact that the 

FCC decisions have on that than the people that I represent, and 

there are also few people that have the same level of appreciation 

of what that impact means and the expertise to provide input. I 

think it is significant that those same commissioners from your 

states have for years, almost a decade now, supported many of the 

specific provisions that we endorse in this discussion draft, and 

when I look at process reform, there are so many reasons that you 

should be considering this carefully. One of them is that if you fix 

it so that the record is better, if you put in these provisions, my 

belief is, publishing the rule ahead of time, making sure there is 

an opportunity to reply to late ex parte filings and studies that 

have been in the record fairly close before the deadline for advocacy 

drops, if you give an opportunity for people to respond to these, if 

you give the Commissioners more time to consider things that they 

are given, then you will get a better decision and you will get a better decision because there is a better record. If you don’t put in 

some of these requirements, and I will mention just three of them, 

the rule to publish the text of the rule in advance, to require minimum comment cycles, which is crucial for state commissions because we have limited resources and we can’t act as fast as others 

can, and to effectively require time for reasonable consideration of 

the ex partes, if just those three requirements, you get a better 

record. If you don’t do those requirements, the people that get disadvantaged are the people that I represent and small businesses in 

your states and the consumer advocates in your states. We are the 

ones that don’t have the resources and can’t respond quickly. But 

no one benefits if we all end up in court arguing about process instead of policy. 

I can see my time is running down here, but I will just say, if 

you look in my testimony, I point out, I am litigating right now in 

the 10th Circuit over a decision that came from this Administration. There are examples from all the Administrations of process 

problems. There I think we have a reasonable chance of coming 

back, bringing the entire reformation of the federal university service regime accomplished by the agency in 2011 back to the agency 

just on process issues, and if those provisions that I mentioned had 

been enacted into law at the beginning of 2011, I wouldn’t be litigating those issues today. 

So I think the bill provides a useful vehicle, and I encourage you 

to seize the opportunity to move forward with reform. Thank you 

very much. 

[The prepared statement of Mr. Ramsay follows:] 

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Mr. WALDEN. Mr. Ramsay, thank you very much for your helpful 

comments. We appreciate that. 

We will turn now to Mr. Stuart M. Benjamin, Douglas B. Maggs, 

Chair in Law and Associate Dean for Research at Duke Law. Mr. 

Benjamin, thank you for being here. 

STATEMENT OF STUART BENJAMIN 

Mr. BENJAMIN. Thank you, Chairman Walden, Ranking Member 

Eshoo, members of the subcommittee. Thank you for the opportunity to testify today. 

My academic career has centered around the FCC. I teach telecommunications law, I coauthor a telecommunications law casebook, and I teach and write in administrative law and the First 

Amendment. From 2009 to 2011, I was the inaugural Distinguished 

Scholar at the FCC, and I thank co-panelist Rob McDowell for coming up with that job title for me. True story. 

So I should also say I have no clients, paid or unpaid, nor have 

I had any clients or consulting relationships since I became an academic in 1997. All right. 

I think I understand the concerns that motivate the FCC Process 

Reform Act, and I think there are quite legitimate questions about 

FCC processes and standards. I do have concerns about the bill as 

drafted, though, for several reasons. First, as has already been 

touched on, the bill contains many new requirements that are 

unique and would bring the FCC into uncharted territory. So there 

are neither agency nor judicial precedents that would provide guidance and clarity, and these new requirements could be the subject 

of litigation; that is to say, one could bring a lawsuit based on 

them. For instance, in addition now to being able to challenge a 

rule as arbitrary and capricious, which one is already able to do, 

one can challenge the adequacy of any or all of the new findings 

required. My concern is, this runs the risk of the bill being a jobs 

program for lawyers. If I were in private practice in D.C., that 

might be great. As a citizen, I am not sure that it is so great. 

And then this uncertainty created by new provisions is exacerbated by the fact that the provisions apply only to the FCC, and 

that brings me to the second concern which is, as Dick Pierce has 

pointed out, the great strength of the Administrative Procedure Act 

is that it applies the same rules to all agencies allowing for consistency and fairness, and this bill would undermine that consistency 

by creating a special set of rules for the FCC. My own view is, if 

the bill’s proposals are good ideas, I think they are worth applying 

across the board. If they are not worth applying across the board, 

I am not sure why they should apply only to the FCC. 

The third concern I want to raise involves merger review. As I 

detail in my written testimony, the requirement of narrow tailoring—narrow tailoring is not found in the U.S. Code, it is found 

only in strict judicial scrutiny—and the requirement of uniqueness 

of harms will, I think, make it difficult, if not impossible for the 

FCC to impose any meaningful merger conditions. If Congress’s 

goal is to eliminate the FCC’s merger review, my suggestion would 

be, you should simply repeal the FCC’s merger authority. That 

would save everyone—companies, citizens, FCC staff—a huge 

amount of time, energy, and money. If, on the other hand, Congress 

88 

wants the FCC to play a meaningful role in merger review, I think 

the legislation should use somewhat less forbidding language than 

this stark language of strict scrutiny. 

My fourth reservation arises out of provisions that would diminish the chairman’s authority. This is something I got great insight 

into when I was at the FCC. In my time there, I came to recognize 

the great value arising out of the clarity of lines of authority, of 

having a clear hierarchy, and reducing the chairman’s authority 

would undermine that clarity, potentially creating confusion and 

inefficiency within the FCC. I understand the arguments for allowing, for instance, a majority of the Commissioners to place an item 

on the agenda. One thing that particularly jumped out at me was 

a proposal to empower a minority of commissioners to block actions 

taken under dedicated authority. I think that is a different matter. 

The Commission makes thousands of decisions every year, and 

businesses and individuals rely on the predictability and speed of 

the FCC’s decision-making process in resolving those matters. So 

changing that process may unsettle a lot of reasonable expectations. 

Fifth and finally, the bill creates additional procedures that I 

fear will confer little, if any, benefit. Notices of inquiry, which of 

course don’t appear anywhere in the APA and only one provision 

of the United States Code, sometimes make sense, and the Commission sometimes uses them, but requiring notices of inquiry will 

further ossify the rulemaking process, and I think the same is true 

of the requirement that proposed rules be issued with a notice of 

proposed rulemaking. The Commission already sometimes or often 

puts out proposed rules with its notices of proposed rulemaking, 

but requiring them, I think, adds cost and very uncertain benefit. 

And it will push rulemaking even more into a rule-adopting process 

in which all the important decisions are made before the APA process even starts. That is to say, the danger is that the APA process 

becomes kabuki theater and public comments arrive after all the 

meaningful decisions have been made. So the concern is, in general 

these provisions will not make the FCC regulation better, just more 

laborious. 

I see that my time is up so I will stop there. 

[The prepared statement of Mr. Benjamin follows:] 

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Mr. WALDEN. All right. We will get to you on questions, I am 

sure, and you will have a chance to elaborate. Thank you for your 

testimony and your participation in the hearing, Mr. Benjamin. 

We will now go to the Honorable—I guess we still call you that 

even though you are out of office now—Robert M. McDowell, former 

Federal Communications Commission member, and Visiting Fellow 

at the Hudson Institute. Mr. McDowell, we really appreciate your 

coming in today to give us your unique perspective as a former 

commissioner and now outside of the portals can speak freely as 

you did when you were inside the portals. So we welcome your testimony, sir. 

STATEMENT OF ROBERT M. MCDOWELL 

Mr. MCDOWELL. Thank you, Mr. Chairman and Ranking Member 

Eshoo and all the members of the subcommittee. It is terrific to be 

back before you, my first time back since the leaving the Commission just about 7 weeks ago. And I did want to also make a special 

note to thank Neil Fried for his many, many years of public service. I have had the privilege and the honor of working very closely 

with Neil on I can’t even count the number of issues over the years, 

and he has been a terrific colleague and a friend, and we wish you 

well in the movie business, so we will see at the movie theater, I 

guess. 

So currently I do serve as a Visiting Fellow at the Hudson Institute’s Center for Economics of the Internet. Having said that, all 

of the views I express today are purely my own, and they may be 

very lonely ideas if no one else agrees with them, but I will say 

them nonetheless. 

FCC process reform is not necessarily the most glamorous of topics but it is an important one, and I commend the subcommittee 

for its ongoing work in this area. The FCC after all regulates about 

one-sixth of the American economy, and really indirectly affects the 

rest. Just as important, the Commission also serves as a regulatory 

template for countries across the globe. The ways in which the FCC 

considers proposed regulations and goes about shaping their substance has a direct effect on the U.S. economy and ultimately not 

just American consumers but consumers around the globe. In short, 

to paraphrase Chairman Emeritus Dingell, those who control the 

process also control the outcome. Accordingly, it is prudent for Congress to cast a bipartisan oversight eye on the processes of all administrative agencies. Chairman Walden and other members 

should be commended for sparking this conversation with the legislation from the last Congress as well as this year’s discussion 

drafts. 

But before going further, I would be remiss if I did not mention 

the need for a fundamental rewrite of our Nation’s laws regulating 

the information, communications and technology sector. Such a 

comprehensive rewrite has not occurred since 1996, and even that 

left in place legacy stovepipes that regulate technologies rather 

than just market conditions. Today, consumers don’t know or usually don’t really care if their data is transmitted over a coaxial 

cable, fiber optics, copper or wireless platforms. In fact, usually 

data is being transmitted over hybrid networks that we are not 

even aware of. It is seamless to the consumer. Instead of directly 

97 

focusing on whether the marketplace is experiencing a concentration of power, abuse of that power, and resulting consumer harm, 

today’s regulations draw their authority from the nearly 80-yearold Communications Act of 1934. The FCC will celebrate its 80th 

birthday next spring. And that Act is based on 19th-century-style 

monopoly regulation, which rests on an even older foundation. 

Therefore, having different regulations based on the type of technology used and their history rather than on current market conditions is likely distorting investment decisions. For the sake of improving America’s global competitiveness, I respectfully urge Congress to move ahead as soon as possible with a comprehensive rewrite of our communications laws with the aim of promoting investment and innovation while protecting consumers. 

Putting some of this into tangible terms, in 1961 when consumers had a choice of one phone company and three broadcast TV 

networks, the FCC’s portion of the Code of Federal Regulations 

filled just 463 pages. In 2010, the FCC’s rules filled 3,695 pages, 

despite the bipartisan deregulatory mandates of Congress as codified in the Telecommunications Act of 1996. Today, the Commission’s rules fill 3,868 pages despite President Obama’s call in 2011 

to pare back unnecessary rules. In short, in a marketplace that is 

undeniably more competitive than it was in 1961, the FCC’s regulations grew by more than 800 percent as just measured in the 

number of pages with a nearly 5 percent increase just since 2010. 

In contrast, the American economy has grown by a much smaller 

number since 1961 by about maybe 370 percent. 

Some of these rules are necessary but are all of them? Shouldn’t 

the Commission have the authority to weed out all outdated rules 

the way it can and must for rules affecting telecommunications 

services under Title II as mandated by Sections 10 and 11? Forbearance authority should apply to all platforms and industries, 

not just traditional telecom services. 

Along those lines, as my fellow witness Randy May has advocated for quite some time, requiring the Commission to justify new 

rules with bona fide cost-benefit and market analyses would help 

better inform policymakers and restrain them from issuing unnecessary rules. Exercising discretion and regulatory humility while 

being patient with markets can create a better experience for consumers. Similarly, new rules should sunset after a definitive period, and the renewal should be justified from scratch in new proceedings with public notice and comment. The continuation of old 

rules may be absolutely necessary, but let us test that premise 

every few years. 

I see I am running out of time. In fact, I am way out of time. 

But other ideas to explore should include, just for respectful mention here, limitations on unnecessary merger conditions that have 

nothing to do with the attendant transactions, shot clocks with exceptions, consolidation of industry reports, and regulatory fee reform, among many others. 

Lastly, I would like to end with a bipartisan applause line: Let 

us have Sunshine Act reform so more than two Commissioners can 

meet to discuss substance without having to call for a public meeting. Let the record reflect there was thunderous applause on both 

sides of the aisle after that. 

98 

Thank you for the opportunity to speak before you today, and I 

look forward to answering your questions. 

[The prepared statement of Mr. McDowell follows:] 

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Mr. WALDEN. Mr. McDowell, as always, thank you for your testimony, as entertaining as it always concludes. We appreciate all of 

the witnesses. I will start out with some comments and questions. 

First of all, picking up on your last comment, I know the desire 

of the agency to be able to have Commissioners, more than one, 

meet together without a public setting. The irony coming from the 

State of Oregon that pioneered meeting requirements both for its 

legislative assembly and its agencies is that that is the one piece 

of this bill that would actually allow activities to occur in private 

that are otherwise public today, and it is also the only provision, 

and correct me if I am wrong, that actually amends the APA itself. 

So the irony is, my friends who object to these other reforms and 

requirements, alleging that somehow this committee would only be 

affecting the APA for one agency, want to affect the APA for one 

agency to allow members of the Commission to meet in private 

without a public setting and do their business. Is that not correct, 

Mr. McDowell, with all due respect to the applause lines? 

Mr. MCDOWELL. Yes, Mr. Chairman, I agree with that. 

Mr. WALDEN. Thank you. 

Now, having put that on the record, let me go to the expenditure 

piece, and I would put in the record with unanimous consent the 

Congressional Budget Office cost estimate from March 19, 2012, 

which looked at the predecessor bill and I think was referenced by 

the distinguished gentleman from California. 

[The information appears at the conclusion of the hearing.] 

Mr. WALDEN. The CBO also went on to say that assuming appropriations and necessary amounts for personnel and information 

technology, under current law, the FCC is authorized to collect fees 

sufficient to offset the costs of its regulatory activities its year. 

Therefore, CBO estimates that the net cost to implement the provisions of H.R. 3309 would not be significant, assuming annual appropriation actions consistent with the agency’s authorities. Yes, it 

does require a few more people. Guess what? Open processes do. 

Mr. Ramsay, I would like to go to you as representing the public 

utility commissions around the country. As you know, my senior 

policy advisor, Ray Baum, behind me, chaired the Oregon Public 

Utility Commission. Much of what we are proposing here is actually already accomplished by many public utility commissions in 

their processes, is it not? Don’t they require rules to be published 

in advance? Don’t they almost prohibit ex parte contact? Don’t they 

require a much more transparent process, which is what we are 

getting at here? 

Mr. RAMSAY. Yes, sir. Generally speaking, my experience has 

been that the State regulatory process is more transparent and less 

subject to processes lapses than the FCC and other federal agencies. 

Mr. WALDEN. And do you think it is right that a federal agency 

can require as a condition of a merger quote, unquote, voluntary 

actions that they could not require under their statutory authority 

otherwise? 

Mr. RAMSAY. Well, NARUC hasn’t taken a position on the merger 

condition authority in the statute, so I—— 

Mr. WALDEN. All right. I will go to Mr. McDowell. Do you think 

it is right that a federal agency can require two parties, or three 

108 

or five or however many in a merger, to do certain things that it 

could not require them to do under their statutory authority? And 

in fact, there are people maybe headed to the FCC who believe that 

authority should be used that way to affect the marketplace, and 

wouldn’t that have an effect on other players in the market not 

subject to the merger, and would that be fair to them? 

Mr. MCDOWELL. That was a compound question so I want to 

make sure I hit all parts of it. So yes, I agree that it is problematic. 

I have been a long-time critic of imposing merger conditions that 

are not related to the actual transaction. It does start to enable the 

Commission to impose effectively a rulemaking or other policies not 

envisioned by Congress so in essence, the FCC is legislating 

through that type of process. 

Mr. WALDEN. And Mr. Benjamin, I want to pick up on one point 

on the notice of inquiry requirement that you objected to. We 

should also, for the record, point out that is only a requirement if 

in the prior 3 years the Commission has not done work in that 

area. So it is not required every single time, it is just to try and 

get some background information ahead of time if they are going 

to act or they haven’t acted before. Is that not accurate? 

Mr. BENJAMIN. Right. So I think the way it is written, you have 

to have either a notice of proposed rulemaking, which would have 

rules in it, or a notice of inquiry or a judicial order. So one way 

or another, before you start the new NPRM, you will have actually 

had a huge amount of process beforehand through a notice of inquiry or through a prior set of rules in an NPRM. 

Mr. WALDEN. So our goal here is—many of you have had very 

good recommendations about things you think could be done better 

or differently, but our goal here—and we will take those into account as we go into a markup at some point and try to get this 

right. We don’t want to hogtie the FCC. We don’t want to add to 

litigation. Believe me, I get a round of applause in any town when 

I confess I am not an attorney. And so I have no interest in adding 

to the legal establishment’s billing hours. I am actually trying to 

improve public process and open this up and do what other agencies already do and do what the President has suggested agencies 

not constituting the FCC do, and we will continue to work on this 

until we get it right but we will move forward. 

So with that, my time has expired, and we have—oh, yes, I have 

one other UC I need to do, which are statements of support from 

various entities, the United States Chamber of Commerce, the National Association of Regulatory Utility Commissioners, the National Association of Broadcasters, USTelecom, Americans for Tax 

Reform, Citizens Against Government Waste, National Cable and 

Telecommunications Association, Comcast, NTCA, and AT&T, 

statements in support of the legislation, unanimous consent to 

enter into the record. 

[The information appears at the conclusion of the hearing.] 

Mr. WALDEN. With that, my time is expired. 

Ms. ESHOO. Were they voluntary, Mr. Chairman? 

Mr. WALDEN. You know, I will let you read them for yourself, 

and yes, I think they are all voluntary. 

Ms. ESHOO. Is it my turn now? 

109 

Mr. WALDEN. It is your turn. And I will turn to my friend from 

California, who we have a little disagreement on parts of this bill, 

but I would tell you, we have 12 minutes left in the vote, so when 

she concludes, then we recess again and then come back. 

Ms. ESHOO. Thank you, Mr. Chairman. 

To all of the witnesses, I just want to share the following with 

you. In listening very carefully to each one of you, I leaned over 

and I said to Mr. Waxman, isn’t it so extraordinary that we have 

the level of expertise that is represented at this time in our country. It makes me feel very, very proud. Whether I agree with some 

of your views or not is not the point but it is really nothing short 

of remarkable, so thank you. I love hearings, and I always learn 

a lot, so thank you for being here and offering what you did in your 

testimony. 

I just want to get something straight off the table so it can be 

just yes or no. Do you all support a standalone action on the FCC 

Collaboration Act as a way of allowing FCC Commissioners to collaborate outside of official public meetings? Yes or no. We will start 

with Mr. Downes. 

Mr. DOWNES. I don’t have an opinion on that. 

Ms. ESHOO. OK. 

Mr. PIERCE. I think it is a good idea but I would like to see it 

as an amendment to the government in the Sunshine Act applies 

to all of the agencies that are run by collegial bodies. There is no 

reason—again, I see nothing unique about the FCC here. It is the 

same as the FERC or any other agency run by a collegial body. 

This would be a big improvement. 

Ms. ESHOO. I appreciate that. I think what needs to be stated for 

the record, and I think the chairman may have thought that it was 

the reverse of what takes place in his home State. There is a requirement in this legislation that is bipartisan and bicameral for 

transparency. So it is not that Commissioners can go off in secret, 

the public never knows what they have talked about and discussed 

and that it just remains there in a secret bubble. That is not the 

way the legislation is drafted. 

So Mr. May, yes or no? 

Mr. MAY. I can’t answer yes or no. 

Ms. ESHOO. OK. Mr. Ramsay? 

Mr. RAMSAY. Yes. 

Ms. ESHOO. Mr. Benjamin? 

Mr. BENJAMIN. I agree entirely with what Dick Pierce said. 

Ms. ESHOO. OK. 

Mr. MCDOWELL. I don’t have an opinion if it is separate or together, but it is a good idea nonetheless. 

Ms. ESHOO. Good. My sense of what really underlies more of this 

effort surrounds one issue, and that is the whole issue of the FCC’s 

authority to review acquisitions and mergers, and I think that that 

is where there is concern. I think that is where there is disagreement. I think that is where there is agitation. I think there is aggravation. And I think that is driving this more than anything else, 

because there are some smaller reforms that can be made that we 

can do on a bipartisan and I think bicameral basis, but I do think 

that this is the area that really causes the most heartburn, both 

pro and con. 

110 

Now, Mr. Pierce and Mr. Benjamin, I think that you made references to this in your written testimony, and I want to give you 

the opportunity to elaborate on it. I think that the draft legislation 

only allows the FCC to impose conditions that are ‘‘narrowly tailored to remedy a harm that arises as a direct result of the specific 

transaction,’’ but these transactions are huge in terms of their impact on the American people, on consumers, on media consolidation, which I think it really goes to the heart of democracy. So 

would either one of you care to comment on what I just said? 

Mr. BENJAMIN. Sure. What is remarkable to me about the language is that it is the language of strict judicial scrutiny, and narrow tailoring, when it is—if I were a judge, I would think Congress 

chose this language for a reason. They chose it because they were 

picking up on strict judicial scrutiny because it is a term of art. 

Ms. ESHOO. Well, it has been chosen for a reason. It didn’t create 

itself. 

Mr. BENJAMIN. I understand, but just to be clear, when courts 

apply strict scrutiny narrow tailoring, they require that the government use the least restrictive means in order to achieve a goal, and 

that is a very difficult standard to meet. As Justice Breyer noted 

in dissent in a couple of cases, any clever or creative lawyer or 

judge can come up with some other less restrictive means. So I 

think as crafted, I think it will be difficult for the FCC to have any 

meaningful merger conditions. And a separate question is whether 

the FCC should be in the business of reviewing mergers at all. My 

only recommendation would be then just do it and avoid a lot of 

confusion. 

Ms. ESHOO. Well, I think that there are some here that believe 

that they just shouldn’t. I don’t know how many but I think there 

are some that hold that view, and they are entitled to it. But I 

think it is very clear that there is a public-interest standard that 

the FCC is charged with, and this has a lot to do with the interest 

of the public and the country. This isn’t just about getting into 

some menacing details just to be complex and complicated. Would 

you like to comment, Mr. Pierce? 

Mr. PIERCE. I didn’t address this in my prepared testimony because it struck me as an issue of substantive communications law, 

and I am not an expert in that. I will change hats, though, and tell 

you I am an expert in antitrust law. That is another subject I have 

been teaching for the last 30-some years, and I agree completely 

with Mr. Benjamin that it would make a lot of sense to take the 

FCC completely out of this. The FCC doesn’t know much about 

antitrust law. The FTC and the Department of Justice know a lot 

about antitrust law. They have the power to impose conditions. 

They regularly impose conditions on mergers. Those conditions are 

specifically tailored to address the competitive issues that are 

raised by a proposed merger. That is something the FTC and the 

Department of Justice, Antitrust Division, know a lot about, and 

the FCC knows very little about. So I agree completely with Professor Benjamin that the far more sensible thing would be a statutory change that would probably require about 10 words that says 

the FCC has no power over mergers; that is exclusively the realm 

of the DOJ and the FTC. 

111 

Mr. WALDEN. Mr. McDowell, I will go to you, but I have to excuse 

our colleagues. We are down to 5 minutes. 

Ms. ESHOO. My time is expired anyway. 

Mr. WALDEN. Go ahead. 

Mr. MCDOWELL. On second thought, actually there is an emerging headline right here, which is, I would agree. 

Mr. WALDEN. You would agree? 

Mr. MCDOWELL. I would agree. 

Mr. WALDEN. With what? 

Mr. MCDOWELL. Antitrust review is a form of public-interest review. So DOJ or FTC under the antitrust review, they are looking 

at harms to consumers, and the public-interest standard of the 

FCC is really ill defined and that is why you get these merger conditions which sometimes have nothing to do with the emerging 

transaction resulting in any consumer harm. So we might be on to 

something here. 

Mr. MAY. I agree as well, Mr. Chairman. 

Mr. WALDEN. All right. I have to cut this off right now because 

we have got less than 4 minutes for the vote on the floor. They expect a few votes thereafter like 15 minutes, so I am going to suggest we will try and come back here about 1 o’clock, a little after 

1:30, if that works. If there are others who have questions—— 

Mr. WAXMAN. Mr. Chairman, I have an appointment at 1:30. 

Otherwise, I am here and I wanted to get my—— 

Mr. WALDEN. OK. We will come back. 

Mr. WAXMAN. At 1 o’clock? 

Mr. WALDEN. I am just speculating that because they said votes 

about 12:30, 12:45. By the time we get back, it will probably be a 

little after 1:00. If we are back sooner, we will start sooner, but to 

give them—you all plan 12:45. How is that? And if we can get back 

here at 12:45, we will, because I want to make sure other members 

have their chances to ask questions of our distinguished panel. 

With that, we will stand in recess. 

[Recess.] 

Mr. WALDEN. We will call back to order the Subcommittee on 

Communications and Technology on our ‘‘Improving FCC Process’’ 

hearing, and we appreciate your indulgence. I hope you all had a 

chance to get out and get a little lunch or something while we were 

voting. You didn’t? Uh-oh. Well, sequester strikes again. 

We are going to go now to the vice chair of the subcommittee, 

Mr. Latta, for 5 minutes for questions. 

Mr. LATTA. Well, thank you very much, Mr. Chairman. I appreciate that. And again, thanks for our witnesses. We have had a few 

votes this morning, and I appreciate your willingness to stick 

around. 

Mr. May, if I could ask a question in regards to forbearance reform at the FCC and get your thoughts on that? 

Mr. MAY. Thank you, Mr. Latta. In my view, it was pretty clear 

when Congress put the forbearance authority in the 1996 act that 

it intended it to be used when appropriate as a deregulatory measure when competition warranted, and I think the fact of the matter 

is—and that is also true of the regulatory review provision that follows it, the periodic regulatory review. The fact of the matter is 

that the forbearance authority has just been little used as a deVerDate Nov 24 2008 12:47 Mar 04, 2014 Jkt 037690 PO 00000 Frm 00117 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 113\113-69 CHRIS
112 

regulatory tool. So what I have recommended, and I think you have 

just introduced a bill which may be somewhat along these lines is 

that without changing the substantive criteria in the forbearance 

provision that is protecting consumers and protecting the public interest, that none of that would be changed, but that the Commission in order to maintain regulations when it has a petition to forbear, that is bear the evidentiary burden, in other words, there be 

a presumption that the statutory requirements aren’t met absent 

clear and convincing evidence or some type of burden. And I think 

by doing that, without changing, again, the substance of the criteria, just as a matter of process and procedure, it would leave the 

tool to be used more as I believe Congress intended when it included it in the Act back in 1996. 

Mr. LATTA. Thank you. 

Mr. McDowell, could I get your thoughts on forbearance reform? 

Mr. MCDOWELL. Yes, as I said in my written and oral testimony, 

Congressman, I think it would be a terrific idea to expand that to 

more than just telecommunications services, which is what Congress did in the 1996 Act. Now, having said, there is a little footnote, which is Section 336, for some reason referred to as Section 

202(h). So our quadrennial media ownership review is also supposed to be a review and to deregulate as more competition comes 

into the media space, but beyond that, for cable, for wireless and 

other areas, the Commission does not have forbearance authority. 

So I think it would be constructive to expand that authority to all 

aspects of what the Commission regulates. 

Mr. LATTA. Thank you. 

Mr. Ramsay, if I could turn to your testimony. You state something there that I mentioned in my opening remarks. You state 

that ‘‘Unquestionably, especially when there is certain lapses that 

occur, unfortunately, when that occurs, those with limited resources, small business, State commissions, consumers, consumer 

advocates, are disproportionately disadvantaged,’’ and that is what 

I hear a lot back home from all these smaller companies out there 

that, you know, they don’t have the resources. Can you just elaborate a little bit on that, how you see that for those that would be 

disadvantaged that have more limited resources? 

Mr. RAMSAY. Well, the problem is, if you have fewer resources 

and you get—and again, I can go back to the transformational 

order that revised the entire Universal Service program at the federal level. There were literally hundreds of items that went into 

the record shortly before the deadline for further advocacy dropped, 

and if you only have one or two lawyers, and in my case, it is one 

lawyer, there is no way that you can go through and look at all of 

those materials and respond really at all, whereas larger, better 

funded people frequently can. In fact, larger and better funded people are frequently the source of a lot of the last-minute filings. So 

in this particular case, there are two or three provisions that I cite 

in my testimony that would level the playing field a little more for 

the consumer advocates, the State public utility commissions and 

the small businesses and small entities. 

Mr. LATTA. Because that would also really impact those startups 

out there. 

113 

Mr. RAMSAY. Yes, I would think so, the people with limited resources. 

Mr. LATTA. And I have met with a lot of the smaller startups and 

they are always concerned because, you know, they are just getting 

started and all of a sudden they don’t have those dollars that they 

have to have to try to meet these regulations that are in place. 

And Mr. Chairman, I will yield back the balance of my time. 

Thank you very much. 

Mr. WALDEN. The gentleman yields back the balance of his time. 

The chair recognizes the gentleman from California, Mr. Waxman, 

for 5 minutes. 

Mr. WAXMAN. Thank you very much, Mr. Chairman. Before I get 

to my questions, I want to make a brief comment about the subject 

that was raised before we broke, and that was whether the FCC 

jurisdiction on the public interest is something in addition to the 

role of the Department of Justice and the Federal Trade Commission. Under the test, the FCC will approve a transaction if considering the potential consumer benefits and harms, it determines 

that the transaction is in the public interest. That is a little different than just the antitrust issues. For example, the FCC looks 

at the diversity of voices. They look to see whether certain populations are being served, low-income people, disabled people. They 

will look to see what the impact is on jobs. They will look at questions of access to telecommunications services. All of these are part 

of what the FCC deals with when we talk about public interest. 

The DOJ process is entirely confidential. The FCC process is generally open with public comment and advocacy subject to certain 

exceptions for proprietary information. So I don’t want to leave 

anyone with the impression that we all agree and maybe you really 

don’t all agree when you think about that the role is duplicative 

or less than critical for the FCC to maintain that power. 

When Chairman Walden circulated the discussion draft earlier 

this week that adds new provisions to the bill that was passed by 

the House last year, I believe these provisions further incapacitate 

the FCC, and I would like to ask our witnesses questions about two 

of these provisions. 

The draft legislation contains a new provision that requires the 

Commission when considering a rule with an economically significant impact—those are the words—to, among other things, ‘‘make 

a reasoned determination that market forces and changes in technology are unlikely to resolve within a reasonable period of time’’ 

the problems the Commission intends to address in the rule. In 

other words, the new language requires the FCC to determine 

whether technology and market changes will solve a problem and 

negate the need for regulation before issuing a rule. 

Mr. Ramsay, in your testimony, you suggest that this provision 

seems, at best, unnecessary because regulators should take a technology-neutral or functional approach to oversight of any market 

sector. Do you think basic principles like protecting consumers and 

promoting competition should be linked to changes in technology 

and are regulators in a good position to make predictive judgments 

about future changes in technology? 

Mr. RAMSAY. I think the part of my testimony that addresses 

that was focused on the fact that technology and technology 

114 

changes are only relevant to the extent that they actually impact 

market forces. The reasons for regulations—and NARUC has been 

on record for years. The reasons for regulation don’t change ever, 

and they don’t change based on the technology that is being used 

to provide a particular service. So in the case of—— 

Mr. WAXMAN. Excuse me. Do you think this language is important to have, or do you think—— 

Mr. RAMSAY. I think the reference to technology is not necessary. 

It is perhaps a little confusing in the context of that Section 3 and 

it doesn’t add anything to any type of determination of the level of 

competition that exists. 

Mr. WAXMAN. I thank you for that answer. I am going to move 

on to some other issues. 

The APA applies to all agencies, and this bill would accept that, 

which the chairman pointed out to me, that his bill specifically says 

that they are not excluding—‘‘nothing in this Act or the amendment made by this Act shall relieve the FCC from any obligations 

under Title V, United States Code, except where otherwise expressly provided.’’ 

Now, Mr. Pierce, you have indicated that this adds another layer 

of requirements on the FCC which could be litigated, and what was 

once litigated under the APA may not apply when there are new 

provisions. Is that a correct statement of your view? 

Mr. PIERCE. That is correct, and actually the provision you were 

just referring to is a good illustration of that. I mean, there is certainly nothing wrong with it. In fact, it would be laudable for the 

FCC to look at the relationship between market forces and technology and the need for regulation and look at the likelihood, but 

as soon as you put that in the statute, you have got more lawyers’ 

work, and when it is an agency-specific statute, the likelihood is 

that it will take 15, 20 years before we get a settled judicial interpretation of what that means, and I don’t have any idea what 

that—and I don’t know what the triggering language will be. 

Mr. WAXMAN. I thank you for that answer. 

This draft legislation also contains a new provision that would 

require advance notice to the Commissioners of any decision or action taken at the bureau level, known as delegated authority, and 

the provision empowers two or more Commissioners to block any 

use of such delegated authority, instead require that the issue be 

considered by the full Commission. So two members can, in effect, 

hold hostage things that are routinely done at the bureau level. 

Now, most of what the FCC does in 2012, there are 165 items released by the full Commission, in 2014, items released at the bureau level. That means 92 percent of all the actions the FCC took 

last year were pursuant to delegated authority at the bureau level. 

So my concern is that if two Commissioners could block the exercise of this authority and require what could have been a routine 

matter to be addressed by all five Commissioners, that is going to 

be an extra burden. It is sort of like the Senate that can stop 

things from happening but putting holds on nominees or requiring 

a threat of a filibuster. 

Professor Benjamin, would you be concerned this might allow a 

minority of Commissioners to frustrate the will of the majority or 

115 

the chairman’s agenda, potentially adding weeks or months of 

delay to routine actions supported by the majority? 

Mr. BENJAMIN. Yes. The serious question would be, why would 

you want to empower a minority that way? Because there really 

are thousands of decisions that we are talking about, and right now 

there are fairly clear lines of authority in the Commission which 

makes for greater efficiency. So if I were a business before the 

agency with a routine matter, I would be concerned. 

Mr. WAXMAN. Thank you. My time is up. But Mr. McDowell 

wanted to respond. 

Mr. WALDEN. We will do that on Mr. Scalise’s time, I think. Mr. 

Scalise? 

Mr. SCALISE. If the chairman is so inclined, could I yield to the 

chairman? 

Mr. WALDEN. I would appreciate that. Thank you. 

So I want to point out why we have added that provision, and 

Mr. McDowell, as a Commissioner, please feel free not only to 

weigh in on Mr. Scalise’s time subsequently yielded but also on 

what I am about to say. 

So it is routine, Mr. Benjamin, that they have these delegated 

authority and these things go through, but there has also been a 

custom, I believe, of 48-hour notice for the other Commissioners so 

they know what is going through on delegated authority. Recently, 

there was a case where an item was put on up on delegated authority on a Friday night triggering the 48-hour notice over the weekend. Now, I don’t think there was any mischief in that, but at some 

point here you could have a lot of mischief occur over a weekend. 

And so we are saying, you know, two Commissioners could say wait 

a minute, whoa, whoa, whoa, what are you doing on supposed delegated authority, because I don’t think that is always clearly spelled 

out. 

But Mr. McDowell, are we hitting on something here? 

Mr. MCDOWELL. A little bit of history here. First of all, it is rare 

for Commissioners to ask for anything that is being done under 

delegated authority to be elevated to an 8th-floor vote. It wouldn’t 

be, with all due respect, akin to a hold in the Senate. What it is, 

it is asking for an 8th-floor vote on these things rather than the 

bureau issuing the role. And, you know, before this hearing I polled 

some of my former staff to ask them how many times did we actually ever want something to be elevated to an 8th-floor vote, and 

we could count on less than one hand the number of times in my 

7 years there where that would actually happen. So it wouldn’t 

hold things up per se. What it actually might do is in a way speed 

things up because bureau decisions can be brought to the 8th floor 

through petitions for reconsideration and other administrative vehicles, and that takes time to get to the 8th floor, so you could actually be short-circuiting that sort of appeals process, and also keep 

in mind, it is very rare. And by the way, in the past when it happened, I mean, one of the instances had to do with a switch digital 

issue and set-top boxes during Chairman Martin’s tenure, and the 

other four Commissioners, two Republicans and two Democrats, we 

were very concerned about the direction that was heading in. It 

was an enforcement proceeding. So it was a bipartisan issue, the 

same with some other issues that I worked with Commissioners 

116 

Copps and Adelstein on during that era. So it is very rare and 

also—— 

Mr. WALDEN. Make it real quick because I am using up his time. 

So let us go to Mr. Scalise. Thanks for your indulgence. 

Mr. SCALISE. Thank you for yielding back. Those are the exact 

questions I was thinking of asking myself, Mr. Chairman. I appreciate you asking them in a much more eloquent way with that 

great radio voice that you have. 

I am glad that we are having a hearing on FCC process reform. 

I was little surprised at the beginning of the hearing that there 

were some that were expressing objection or concern about us taking up FCC process reform, and obviously, Mr. Chairman, you have 

got two bills on this agenda that we are talking about, and both 

of them deal with, I think, very important reforms. But when you 

look—the IRS serves as a poster child for what happens when a 

federal agency thinks that they are no longer accountable to the 

American taxpayer, and you just look at the abuses that are happening because they weren’t reform, because they didn’t think that 

they had to answer to anybody. And so when we talk about reforming processes at the FCC, it is critical that Congress play this role. 

And look, if the Senate doesn’t think it is important to have transparency and accountability and reform, let them go out and defend 

it, but shame on us if we don’t exercise our responsibility in making sure that these federal agencies that we oversee are accountable, because we have seen some troubling examples at the FCC, 

and I think, Mr. Chairman, you pointed out some real concerns, especially as we have seen with mergers in the past and then the 

comments by Mr. Wheeler where he in essence was tacitly 

condoning the practice of the FCC literally just trying to hold up 

a merger unless companies would accept regulations, de facto regulations that Congress didn’t even pass. So Congress said we don’t 

think that this should be a law, and somebody at the FCC who 

thinks they are unaccountable says I think it should be a regulation anyway and even though I can’t get it approved, I will just 

hold up a company’s merger unless they agree to something that 

Congress doesn’t even think should be passed, and I think that is 

a major concern of a lot of us. I think there is some real issues that 

need to be pursued on that. We need to get involved congressionally and stop them from doing this. 

Commissioner McDowell, in my last few seconds here, I want to 

ask you about it. First of all, I want to ask, does anybody on the 

panel think it is oK for the FCC to shake down a company, to hold 

up a merger over requiring them to accept a regulation that Congress didn’t even pass? Does anybody want to defend that practice? 

I am glad to see, it is sort of like the thunderous applause you had, 

Commissioner McDowell. Nobody wants to defend it. But did you 

see it when you were at the FCC? Did you see that kind of what 

I think is unethical activity? 

Mr. MCDOWELL. Sure. There are reasonable differences in interpretation of what the public interest is. I have had a lot of conversations with my colleagues over the years over this, and some 

think that anything that benefits the public is the cost of the transaction. I disagree with that. I think it has to do with, is there a 

merger-specific harm to consumers that needs to be cured. Others 

117 

think that it is a broader interpretation of a public-interest standard, but that is precisely what the bill, I think, tries to address is 

to put a fence around that, a definition around what the public-interest standard would be. 

Mr. SCALISE. I think that would be important to have, so I thank 

you, and I thank you, Mr. Chairman. I yield back. 

Mr. WALDEN. I now recognize the chairman emeritus of the committee, the gentleman from Michigan, Mr. Dingell. 

Mr. DINGELL. Mr. Chairman, I thank you for your courtesy. I 

commend you for this hearing. 

Like the chairman, I am very much concerned about the somewhat curious functioning of the Federal Communications Commission, so I performed a very thoughtful analysis of the Commission 

Reform Act to see how it works, and one of my first concerns it, 

it seems to affect in a curious way 67 years of administrative law 

and related jurisprudence. It subjects only one federal agency to 

unique administrative procedures that will be different than all of 

the others and will open the door to years of litigation and uncertainty, ultimately stymieing, I think, rather than streamlining the 

work of the Commission. 

My questions this morning are directed to Mr. Benjamin and 

they concern only the draft Federal Communications Commission 

Process Reform Act. I hope you will oblige me, sir, with yes or no 

answers. 

Mr. Benjamin, with respect to the Commission’s rulemaking authority, I note that Section 13(a)(2) of the draft bill mandates the 

Commission to fulfill a number of new requirements prior to 

amending or adopting a new rule. Is it your understanding that a 

party could challenge the Commission’s completion of such new requirements in court? Yes or no. 

Mr. BENJAMIN. Yes. 

Mr. DINGELL. Now, Mr. Benjamin, the practical effect of such judicial review would be to slow or to hinder the Commission’s ability 

to promulgate new rules, yes or no? 

Mr. BENJAMIN. Yes. 

Mr. DINGELL. And it would be a significant change in the Administrative Procedure Act, would it not? 

Mr. BENJAMIN. Yes, with respect to the FCC. 

Mr. DINGELL. Now, Mr. Benjamin, the new requirements in Section 13(a)(2) contain undefined terms such as ‘‘specific market failure’’, ‘‘actual consumer harm’’, ‘‘burden of existing regulation’’ and 

‘‘reasonable period of time.’’ Is it probable that interested stakeholders will challenge the Commission’s application of such terms 

in the event stakeholders disagree with the Commission’s ruling on 

a particular matter in court? Yes or no. 

Mr. BENJAMIN. Yes. 

Mr. DINGELL. Now, Mr. Benjamin, again, the practical effect of 

such challenges would be to hinder and to slow the Commission’s 

ability to agree on new rules or to amend or rescind existing rules. 

Yes or no? 

Mr. BENJAMIN. Yes. 

Mr. DINGELL. Now, so far it would seem then that one of the 

draft bill’s primary effects would be to sand the gears of the Commission when it comes to rulemaking. I would like to turn my atVerDate Nov 24 2008 12:47 Mar 04, 2014 Jkt 037690 PO 00000 Frm 00123 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 113\113-69 CHRIS
118 

tention to the draft bill’s effect on the Commission’s merger review 

authority. 

Now, Mr. Benjamin, Section 13(k)(1)(A) requires that the Commission impose conditions on transactions and transfers that are 

‘‘narrowly tailored to remedy a harm that would likely arise as a 

direct result’’ of such transactions and transfers. Is it your opinion 

that this requirement will invite strict scrutiny by the courts of 

merger conditions imposed by the Commission? Yes or no. 

Mr. BENJAMIN. Yes. 

Mr. DINGELL. And it would be a fine opportunity for repeal and 

judicial review, right? 

Mr. BENJAMIN. Sorry, repeal? 

Mr. DINGELL. The conditions and so forth would be a fine opportunity for judicial review? 

Mr. BENJAMIN. Yes. 

Mr. DINGELL. Now, Mr. Benjamin, is it your opinion that it will 

be extremely difficult to craft merger conditions that would satisfy 

Section 13(k)(1)(C) of the draft bill, which specifies that such conditions address a harm ‘‘uniquely presented by the specific transfer 

of lines, transfer of licenses or other transactions such that the 

harm is not presented by persons not involved in the transfer or 

other transaction.’’ Yes or no? 

Mr. BENJAMIN. I think I understand your question. Yes. 

Mr. DINGELL. That is a wonderfully complex sentence too, isn’t 

it? 

Now, Mr. Benjamin, additionally, I note that Section 13(k)(2) of 

the bill prohibits the Commission from adopting voluntary merger 

conditions that are not consistent with the conditions I mentioned 

in my previous questions. Is it your opinion that such prohibition 

would serve as additional roadblock to merger approvals and to potentially diminish, if not eliminate, the Commission’s role in merger reviews? Yes or no. 

Mr. BENJAMIN. Yes, in combination with the other provisions. 

Mr. DINGELL. I am running out of time and I apologize to you. 

Now, finally, is it correct that the draft bill provides no additional authorizations of appropriations or personnel for the Commission to comply with the new requirements of the legislation 

which would impose a demand for new personnel, money and so 

forth through the agency? Yes or no. 

Mr. BENJAMIN. Yes. 

Mr. DINGELL. So the long and short of this is that the draft bill 

then could conceivably hinder the Commission rulemakings but 

also severely restrict its ability to approve mergers. At this point 

I am rather distressed to note that the bill would impose a kind 

of curious Magnuson-Moss rulemaking requirement on the Commission which will not streamline its processes or provide it with 

resources with which to comply with the draft bill’s new and more 

onerous mandates. 

I say this to you, Mr. Chairman, with affection and respect, in 

the hope that the committee will continue to seek the views of 

stockholders and stakeholders about the draft bill that will enable 

it to work to expeditiously conduct the business of the Commission, 

and I would hope that the thoughtful work of the committee will 

enable us to solve some of the questions that appear here to stand 

119 

in the way of writing good legislation. I thank you for your courtesy 

to me. 

Mr. LATTA [presiding]. Thank you. The gentleman’s time has expired, and at this time the chair recognizes the gentleman from Illinois for 5 minutes. 

Mr. KINZINGER. Thank you, Mr. Chair, and thank you, gentlemen, and you made it to the bottom row so you are almost about 

to go home. Congrats. 

Thank you for being out here. The discussion we are having is 

important regarding the efficacy and efficiency of the regulatory environment. In looking through the written testimony, one statement that really caught my eye in Mr. Downes’ testimony was 

transfers delayed are consumers underserved. That sums up a lot 

of this debate quite nicely. 

We are all trying our best to complete work that will best serve 

our constituents, but the problem is that overly caustic and nonstandardized regulations keep delaying the possible benefits of the 

changes in the telecommunications industry for our constituents. 

With the continuing advances of technology occurring at such a 

rapid pace, I do believe that current FCC process needs to be reformed to deal with such a unique industry. 

That brings us to the topic of today’s hearing, the draft legislation for FCC process reform and the FCC Consolidated Reporting 

Act. We discussed similar legislation in the 112th Congress, which 

actually passed the House in a bipartisan manner, and I am happy 

to see that we are back today discussing what I believe are much 

improved versions of those pieces of legislation. 

The FCC process reform draft will make great strides in improving the predictability, efficiency, and most importantly, the transparency of the FCC in its operations. Government transparency is 

a major key to gaining the trust of the American public, and this 

draft legislation includes a number of provisions that will not only 

standardize many of the actions of the FCC but will also make it 

more transparent to the general public. 

I would also like to add that I do appreciate the efforts of former 

Chairman Genachowski and Acting Chairwoman Clyburn on many 

of these issues. As I have said before, though, statutory authority 

should be what drives the decision-making process at the FCC, not 

the discretion of whomever may be the chair during a specific period of time. 

In response to some of the questions, however, that we just 

heard, I would like to ask Commissioner McDowell, I am going to 

give you a number of questions and we will do the yes-no thing if 

that works for you. While most agencies are subject to the APA, 

they don’t all rely on procedures that differ to varying degrees such 

that no agency actually has the same processes. Is that correct? 

Mr. MCDOWELL. Exactly, yes. 

Mr. KINZINGER. Do the new requirements in the bill requiring 

the FCC to actually justify its actions prior to adopting a rule constitute good government practices that will result in better rules? 

Mr. MCDOWELL. Yes. 

Mr. KINZINGER. Do stakeholders currently challenge most of the 

Commission’s significant decisions in court even when the FCC is 

on relatively firm ground? 

120 

Mr. MCDOWELL. Pretty much everything the FCC does gets appealed, yes. 

Mr. KINZINGER. Understood. Has poor FCC process and weak 

analysis caused the litigation? 

Mr. MCDOWELL. It has, but again, everything gets appealed, 

even when it is strong. 

Mr. KINZINGER. All right. A lot of lawyers in this town. 

Mr. MCDOWELL. Yes. 

Mr. KINZINGER. So is it fair to say the bill won’t really increase 

the amount of litigation but actually might reduce it, do you think? 

Mr. MCDOWELL. I don’t know if it will reduce it but it could help 

make for better public policy. 

Mr. KINZINGER. OK. Does the FCC itself often adopt requirements that contain undefined terms? 

Mr. MCDOWELL. All the time. 

Mr. KINZINGER. Does leaving some terms in the bill undefined 

and allowing the FCC to define them provide flexibility to the 

agency? 

Mr. MCDOWELL. It provides more certainty, and therefore, for future Commissions would limit the sort of arbitrary nature of whoever is in those chairs interpreting more ambiguous terms. 

Mr. KINZINGER. Thank you. Doesn’t the bill leave the public-interest standard intact and still allow the FCC to deny transactions 

or impose tailored conditions such as divestitures of certain assets? 

Mr. MCDOWELL. Yes, and real briefly, I think it actually makes 

things more efficient in that regard. So if you are narrowing the 

scope of merger approval process and the substance of it, then you 

are actually, I think, speeding things up, that there are a lot of extraneous things that could not be examined because it is not specific to the merger. 

Mr. KINZINGER. And lastly, is it your belief that there are sufficient bodies at the FCC that some could be spared to help implement this new law and that the improvement in policy would be 

well worth the effort? 

Mr. MCDOWELL. I think the improvement would be well worth 

the effort. 

Mr. KINZINGER. Excellent. With that, I have got 50 seconds left, 

I don’t want to get into a new line of questioning, so Mr. Chairman, 

I will yield back. Do you want—— 

Mr. WALDEN. If you don’t mind yielding to the gentleman? 

Mr. KINZINGER. I will yield to the esteemed gentleman. 

Mr. LATTA. The gentleman yields. 

Mr. WALDEN. So Mr. McDowell, just in the final 40 or so seconds 

here, we didn’t get time to really get into chevron deference and 

what agencies can do, and the courts have a pattern of deferring 

to what agencies have done, if they have done their work, correct? 

Mr. MCDOWELL. If they have done what? I am sorry. 

Mr. WALDEN. Well, if they have followed their procedures and 

they have shown how they complied, haven’t courts also given 

chevron deference to the FCC in matters? 

Mr. MCDOWELL. On procedure but also on the substantive statutory language if they are following that and are faithful to 

Congress’s intent, yes. 

121 

Mr. WALDEN. Because again, back to the Oregon example with 

the public utility commission, if you do your job, the courts will 

generally—isn’t this true, Mr. Ramsay—defer to the expert agency? 

Mr. RAMSAY. Particularly on factual terms, yes, sir. 

Mr. WALDEN. My time, your time is expired. I will let the chairman wrap it up. 

Mr. LATTA. The gentleman’s time has expired, and at this time 

I defer to the chairman to see if there is any further business to 

come before the committee? 

Mr. WALDEN. I don’t believe so. We want to thank our witnesses, 

though, for your expert testimony. It is very helpful. We realize we 

have a work product in front of us. What you have suggested will 

help us refine that product and get it right, and we will continue 

our efforts to reform this agency in a way that makes it a leader 

for the other agencies, and since we don’t have full jurisdiction over 

the APA, we can only do what we can do, but we are going to do 

it. So thank you all. 

Mr. LATTA. Hearing no further business before the committee, 

the committee stands adjourned. 

[Whereupon, at 2:00 p.m., the subcommittee was adjourned.] 

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