The U.S. Supreme Court is stepping into a high-stakes legal showdown that could shake the foundations of how America keeps its rural and low-income communities connected.
At the center of the storm is the Federal Communications Commission’s Universal Service Fund — a $9 billion-a-year initiative that’s been powering broadband and phone access for underserved groups for nearly three decades. But now, the fund’s very existence is under constitutional fire.
The core argument? Critics say the FCC has been operating beyond its bounds, acting like a tax-collecting body without Congressional oversight. And the justices are about to decide whether that’s a bridge too far.
The case stems from a 2024 decision by the 5th U.S. Circuit Court of Appeals, where a sharply divided bench ruled the funding mechanism unconstitutional. The ruling didn’t pinpoint a single violation but instead condemned what it called a dangerous cocktail: an overly broad delegation of power by Congress to the FCC, followed by an improper handoff of authority to a private company.
That private entity — the Universal Service Administrative Company — collects payments from telecom giants and distributes the funds to schools, libraries, tribal lands, and low-income users. Opponents, including conservative watchdog Consumers’ Research and a small telecom carrier, claim the FCC gave USAC far too much power, letting it shape funding formulas and collection strategies with minimal oversight.
Their argument is rooted in the “non-delegation doctrine,” a dusty but potent constitutional principle that says Congress can’t just toss its lawmaking power to other entities — especially not to unelected regulators or private corporations.
The FCC, in turn, insists that it has stayed within the lines Congress drew back in 1996 when the Telecommunications Act was passed. According to the agency, it hasn’t handed over the reins of governmental power to USAC but simply relies on it for technical administration.
This is more than a bureaucratic battle. A ruling against the FCC could ripple across other federal agencies, especially in a legal climate where the Court has grown increasingly skeptical of regulatory overreach. With a 6-3 conservative tilt, the justices have already trimmed the wings of several federal bodies in recent years — though the non-delegation doctrine itself has yet to make a major comeback.
All eyes are now on the Court as it hears arguments this week. A decision is expected by the end of June — one that could either reaffirm the federal government’s role in bridging the digital divide or force a dramatic rethinking of how that mission is funded.
