California fighting “preposterous demand”
Reynolds’ letter acknowledged that the NTIA may not agree with the CPUC’s stance and said the state thus will not distribute any funding to ISPs until after the state and federal agency sort out any differences. If the NTIA refuses to change its position, California could sue the Trump administration on the grounds that the condition is unconstitutional.
The NTIA does not appear likely to bend. “As noted in the Department’s response to CPUC, the terms and conditions of the award constitute the entire agreement between NTIA and CPUC. No part of the letter outlining CPUC’s concerns is incorporated into or made part of the award,” an NTIA spokesperson told Ars today.
Consumer advocacy group Public Knowledge supported CPUC’s position. The Trump administration’s demand to preempt state laws is “brazen and meritless,” the group said.
“This administration’s preposterous demand that industry be given a blanket waiver from affordability requirements, net neutrality and privacy protections, and any other commitments to connect and serve Americans has no basis in the Infrastructure Investment and Jobs Act (IIJA), which established BEAD. And, as the commission points out, the NTIA has no authority to alter California state law or require California agencies to not enforce the law,” said Raza Panjwani, senior policy counsel at Public Knowledge.
The CPUC voted to ratify the funding plan in September. But Reynolds said in yesterday’s letter to the Trump administration that his agency’s acceptance of the funds is “based on the CPUC’s best understanding of the effect of Section 50” of the BEAD terms and conditions. Section 50 of the BEAD rules says each state:
shall commit that it will not enforce any law, regulation, order, contracting requirement, or other enforceable obligation that directly or indirectly regulates the rates, terms, and conditions of broadband Internet service… or imposes net neutrality rules, open access, or other utility-style rules on broadband Internet service, against a Subgrantee or its affiliates anywhere it provides service within the State (i.e., both BEAD and non-BEAD locations), while that Subgrantee has any subgrant that is still within its period of performance, extended period of performance, or federal interest period.
The BEAD rules specify that a net neutrality rule is one prohibiting ISPs from “blocking content, throttling speeds, imposing data caps, or engaging in paid prioritization.” ISPs obtaining BEAD funding could be exempt from such laws for up to 14 years.