Increasing Telephone Penetration Rates and Promoting Economic Development on Tribal Lands: A Proposal to Solve the Tribal and State Jurisdictional Problems

I. INTRODUCTION The Telecommunications Act of 1996(1) ("1996 Act") instructed the Federal Communications Commission ("FCC" or "Commission") to ensure that all Americans have access to affordable telecommunications services.(2) Consistent with that mandate, the Commission now seeks to secure affordable telecommunications services for those in rural, insular, and high-cost areas.(3) More importantly, the FCC held a series of public hearings to discuss with Tribes(4) the issues they face concerning low telephone penetration rates.(5) The FCC recommended investigation of universal service in unserved and underserved areas because telephone penetration rates among low-income consumers on tribal lands lagged behind rates in the rest of the country.(6) Approximately 94.2% of all U.S. households have telephone service,(7) while subscribership on tribal lands is 46.6%.(8) After meeting with Indian leaders and telecommunications service providers at two formal field hearings held in New Mexico and Arizona, the FCC tentatively implemented several policies to address low telephone penetration rates on tribal lands.(9) In response to the many requests made by tribal leaders for a statement of policy that recognizes tribal sovereignty and the government's fiduciary duty to Tribes, the FCC validated its commitment to promoting a government-to-government relationship between the FCC and all federally recognized Tribes. Specifically, the FCC reaffirmed its commitment to: (1) "work with Indian Tribes on a government-to-government basis consistent with the principles of Tribal self-governance;" (2) "consult with Tribal governments prior to implementing any regulatory action or policy that will significantly or uniquely affect Tribal governments, their land and resources;" and (3) "identify innovative mechanisms to facilitate Tribal consultation in agency regulatory processes that uniquely affect telecommunications compliance activities ... and other telecommunications service-related issues on Tribal lands."(10) Despite the FCC's positive policy statements, however, it also established that such statements do not "create any right enforceable in any cause of action" against the FCC, the United States, or any other party.(11) Furthermore, in its effort to understand the reasons for low penetration rates on tribal lands, the FCC requested comments concerning its proposed rules on tribal jurisdiction.(12) Specifically, the FCC sought comments regarding the extent of state and tribal regulation of tribally owned or nontribally owned telecommunications carriers providing service to tribal lands.(13) This includes jurisdiction questions with respect to: (1) tribally owned or operated carriers providing service within reservations to tribal members, nontribal members, and nontribal members living on nonnative fee lands (within the reservation);(14) (2) nontribally owned or operated carriers offering service both inside and outside of the reservation; and (3) tribally owned or operated carriers offering service outside the reservation.(15) The parameters of federal, state, and tribal authority are not always clear. As the United States Supreme Court acknowledged in dicta, "[g]eneralizations on this subject [of Federal Indian policy] have become particularly treacherous."(16) Despite the complexities of determining tribal and state jurisdiction, the FCC tentatively established a framework to answer the jurisdictional questions posed in previous proceedings.(17) First, under 47 U.S.C. [sections] 214(e)(6),(18) the Commission may designate tribally owned and nontribally owned carriers serving tribal lands as eligible carriers.(19) The threshold question in these situations is whether the state lacks jurisdiction to designate and regulate carriers wishing to serve tribal lands.(20) The FCC must consider "whether state regulation is preempted by federal regulation, whether state regulation is consistent with tribal sovereignty and self-determination, and whether the Tribe has consented to state jurisdiction. …