Two developments last week signal the likely demise of hotspot E-Rate eligibility for FY 2025 and beyond.
Most immediately was an announcement by Sen. Cruz (R-TX), the new Chairman of the Senate Commerce Committee, that he will introduce Congressional Review Act (“CRA”) resolutions this week to overturn a number of Democratic-sponsored resolutions with the FCC’s hotspot order being prominently mentioned.
By way of background, the CRA is a tool that Congress can use to overturn recently finalized rules and regulations. The CRA requires that agencies submit “covered” rules to Congress and the Government Accountability Office (GAO) before they may take effect. Congress then has a limited period of time in which to use special fast-track parliamentary procedures to consider legislation overturning those rules. While often thought of as a tool that an incoming Administration can use to reverse “last-minute” actions of the outgoing Administration, this year’s CRA affects rules enacted back to early August, about a week before the publication of the hotspot order. Use of the CRA to kill hotspots requires a simple majority vote in both houses of Congress; is not subject to filibuster; and, once reversed, rules cannot be reintroduced. We should know the Congressional fate of hotspot eligibility shortly.
The other challenge to hotspots comes from the FCC itself. Initially, post-inauguration, the Commission will be comprised of four Commissioners, two Republicans (including the new Chairman Brendan Carr) and two Democrats. As we have discussed in the past, the hotspot order was approved along party lines in a contentious 3:2 vote under Democratic Chairwoman Jessica Rosenworcel, who has just resigned. The party alignment is now 2:2. Until there is a fifth Commissioner, whose vote would break a tie, an FCC decision to eliminate hotspot eligibility is unlikely.
But that time is not far off. Last week, Trump named Olivia Trusty, a top GOP aide on the U.S. Senate Commerce Committee, as his pick for the next, and third, Republican Commissioner seat. Confirmation by the Senate should ensure a 3:2 Republican majority soon. Thus, unless Congress moves first on hotspots, the FCC may soon vote to eliminate hotspot eligibility.
Also on the horizon, under a 3:2 Republican FCC majority, is the possible reconsideration of two other FCC programs that the two existing Republican Commissioners had originally voted against, school bus Wi-Fi eligibility and the Cybersecurity Pilot Program. Our view on these two issues under the new Administration is briefly as follows:
- The eligibility of school bus Wi-Fi is likely to be reconsidered. One possibility, short of eliminating the provision altogether, would be require bus internet services to be filtered so as to provide internet access only through the schools’ own systems. This would make it easier to argue that school bus access is just an extension of in-school study halls, fully covered under the schools’ existing internet safety policies — in a sense, no different from library bookmobiles being extensions of libraries. This would also counter the concerns of some in Congress, including Ted Cruz, and the Fifth Circuit court, that bus Wi-Fi was just going to be used for social media access.
- Both current Republican Commissioners had previously expressed support for cybersecurity measures, but had voted against the final Cybersecurity Pilot order. We find it hard to believe that anyone could turn a blind eye to the risks of cybersecurity, nor that the FCC would kill the Pilot now underway (see below), but some changes may be forthcoming.