Can States Reimpose Net Neutrality?

With “net neutrality” rules dead at the Federal Communication Commission (FCC), several politicians are looking to bring them back on the state level.

The day before last week’s FCC vote to repeal the Obama-era internet regulations, Washington state Rep. Brian Hansen (D–Bainbridge Island) introduced a bill to reinstate many of the provisions the feds were about to undo. This effort was quickly endorsed by Democratic Gov. Jay Inslee, who on the same day published a hodgepodge of policy proposals all designed to keep net neutrality alive in the Evergreen State.

Meanwhile, California state Sen. Scott Wiener (D–San Francisco), published a post on Medium vowing to fight the regulatory rollback. “Now that the FCC has repealed net neutrality, let’s adopt it in California,” he wrote.

Is that legally possible? A plain reading of the FCC’s Restoring Internet Freedom order suggests that it is not. Says the commission: “we…preempt any state or local measures that would effectively impose rules or requirements that we have repealed or decided to refrain from imposing.”

Hansen rejects this preemption. The FCC is adopting a double standard, he tells Reason, by lessening federal authority over the internet but also increasing federal authority over state attempts to regulate the internet.

“The FCC is declaring that a certain set of federal statutory provisions do not give it the authority to regulate standards of conduct on the internet,” Hansen says. “Yet somehow, as if by magic, that same statute gives them the authority to preempt state attempts to regulate standards of conduct on the internet. I’m not sure how that can coexist.”

Last week’s FCC order addresses this by saying that federal communications law establishes “competitive, deregulatory goals,” that its repeal of net neutrality services these goals, and that preempting states from reestablishing net neutrality regulation is part of this approach. Thus, “an affirmative federal policy of deregulation is entitled to the same preemptive effect as a federal policy of regulation.”

Hansen maintains that the state-level net neutrality provisions contained in his bill are justified under a state’s “historic consumer protection authority.” Hansen’s bill prohibits any blocking or throttling of “lawful content” and bans paid prioritization—that is, charging consumers higher rates to prioritize faster service for, say, online gaming or video streaming.

Hansen’s bill is on shaky ground here too, says Tom Struble, an attorney and analyst at the R Street Institute.

States do have pretty wide latitude to pass their own consumer protection laws to guard against what they find to be “unfair or deceptive” practices, says Struble. What they can’t do is define “unfair or deceptive” to mirror the recently repealed net neutrality regulations.

“Any state laws that conflict with this deregulatory approach, this federal approach, are unlawful,” says Struble. That would include an explicit ban paid prioritization, a practice the FCC consciously deregulated in its order.

Gov. Inslee concedes this point, saying that “the FCC’s vote will preempt states from ensuring full net neutrality.”

What Inslee recommends instead is a series of workaround which will allow Washington to reimpose some form of the net neutrality regulations. This includes restricting access to the state’s utility poles to ISP’s that adopt net neutrality practices. Wiener makes a similar suggestion, saying that California should restrict access to utility poles and public rights of way to businesses that stick to those same net neutral practices.

This too would be run afoul of the FCC’s state preemption ruling, says Struble. He cites AT&T v. Portland, a 2000 case in which the Oregon city tried to force AT&T to allow competing ISPs to use its cable facilities as a condition for the city granting AT&T a cable franchise license. The 9th Circuit Court of Appeals held that federal regulators’ refusal to adopt similar requirements for cable providers meant that Portland could not unilaterally impose them.

There is one item on the Inslee/Wiener agenda that could pass legal muster. Both men proposed using their states’ buying power to require government-contracted ISPs to adopt net neutrality practices. Struble says the states would be well within their rights to do this.