Carr Looking at Next Steps after DC Circuit Overturns Part of Small-Cell Order

“I’m actually pretty pleased with the reforms that were upheld by the D.C. Circuit” though “we would have been very happy to be affirmed across the board,” Carr said in an interview. “We’ll keep looking at our potential next steps,” he said: The court didn’t “foreclose the FCC from going back and revisiting the decision or foreclose the FCC from saying again that as a matter of environment and historic preservation law small cells aren’t federal undertakings or major federal actions.”

Other FCC officials said the court effectively threw out the most important part of the FCC’s order and the decision means small cells are now back under environmental and historic review and FCC review more generally.

“The court just vacated a large part of the @FCC's 5G deployment strategy,” tweeted Commissioner Jessica Rosenworcel: “For those paying attention, that means the agency tasked with the future of connectivity didn't get it right. It's time to go back to the drawing board and do better.” The FCC approved the order 3-2 over dissents by Rosenworcel and then-Commissioner Mignon Clyburn (see 1803220027).

“Today’s decision confirms that the FCC cannot just scream ‘5G’ to justify ignoring its duties to Tribal Nations and to the environment,” emailed Georgetown Law Institute for Public Representation Senior Counselor Andrew Schwartzman, a party in the case. “The decision does give the FCC more latitude than we would prefer on some of the mechanisms for tribal review, but we will deal with that on the remand.” The United Keetoowah Band, the Natural Resources Defense Council and other appellants didn’t comment.

Court's Decision

“The Commission failed to justify its determination that it is not in the public interest to require review of small cell deployments,” the court said in a decision by Judge Cornelia Pillard. “We therefore grant the petitions in part because the Order’s deregulation of small cells is arbitrary and capricious. The Commission did not adequately address the harms of deregulation or justify its portrayal of those harms as negligible. … The FCC’s characterization of the Order as consistent with its longstanding policy was not ‘logical and rational.’”

The FCC “inadequately justified its portrayal of deregulation’s harms as negligible,” Pillard wrote. “The FCC partly based its public-interest conclusion on a picture of small cells that the record does not support.” The decision also questioned the order's logic in other areas. It noted the FCC has taken other steps to cut red tape: “By ignoring the extent to which it had already streamlined review, the Commission … overstated the burdens of review.”

“The scale of the deployment the FCC seeks to facilitate, particularly given its exemption of small cells that require new construction, makes it impossible on this record to credit the claim that small cell deregulation will ‘leave little to no environmental footprint,’” Pillard wrote: The FCC “also failed to assess the harms that can attend deployments that do not require new construction, particularly the cumulative harms from densification.” The FCC “dismissed the benefits of historic-preservation and environmental review in a two-sentence paragraph, describing most of the comments that highlight those benefits as ‘generalized’ and the comments that point to specific benefits as ‘few,’” the court said: “Characterizing a concern as ‘generalized’ without addressing that concern does not meet the standard of ‘reasoned decisionmaking.’” The other panelists who heard the case were Judge David Tatel and Senior Judge Harry Edwards.

The decision's “front end” dealt with excluding small cells from environmental and historical reviews, Carr told us. “The second half dealt with really reforming and streamlining the rules that apply to cellsite builds that are subject to environmental and historic preservation” rules, he said. “Those reforms on the back end are really pretty significant.” The FCC “eliminated entirely” upfront fees for reviews of cellsites, Carr said: “The financial incentives for abuse of the system” for all cellsites “has been taken out of the system.” The record found “an increase in tribes requesting upfront fees, a significant increase in the amounts of fees being requested. That was a big roadblock to 5G build,” he said. Those changes stand, he said: “It’s a pretty big win.”

“We also accelerated the timeline for some of these tribal reviews,” Carr said: “That was also upheld. We also made clear that when you’re building cellsites you don’t have to necessarily use a member of the tribe for the historic preservation review.” At least three “significant reforms … were all affirmed,” he said.

The order was “a bold attempt to address one of the biggest obstacles to timely 5G deployment,” said Gus Hurwitz, associate professor at the University of Nebraska College of Law. “Part of it was too aggressive for the D.C. Circuit, but the rest was affirmed.” The court’s decision was very fact-driven, he said. “The judges were far more willing to delve into the record, and even to consider statements made at trial … than we have seen in judicial review of other recent high-profile FCC orders." That could suggest “the judges took strong issue with the order,” he said: “It also makes clear that the order was, if aggressive, not an unreasonable effort on the part of the commission.”

Mixed Bag

The decision “was a mixed bag” for the FCC, said R Street Tech Policy Manager Tom Struble. “On net, it's a win for the FCC, as the deployment process should be faster and cheaper now than it was before the order was passed.” Struble said next steps remain to be seen. “It's unclear whether or how the FCC will address historic and environmental review going forward,” he said: “Perhaps they'll be able to restart the process and re-enact those same or similar provisions in a future order, but I'm not sure. I'll have to review the opinion more closely to decide whether the better process … can save those historic and environmental reforms or whether that's simply beyond the FCC's scope and only Congress will be able to address it.” An appeal is unlikely since the decision was unanimous, he said, noting the stakes are even higher for the FCC in the pending 9th Circuit case.

“Over the past few years, the FCC has made considerable progress in removing barriers to 5G deployment, including eliminating unnecessary regulations and streamlining siting processes,” said Wireless Infrastructure Association President Jonathan Adelstein. “The D.C. Circuit upheld part of the FCC Infrastructure Order that will help speed deployment across the United States.”

CTIA also emphasized that parts of the order still stand. “The FCC has rightfully sought to modernize outdated siting rules to accelerate the deployment of 5G technologies, and it’s been working,” said CTIA General Counsel Tom Power: “We are pleased that the court affirmed some of these steps today, particularly with respect to fees and deadlines for siting reviews. The court’s decision also underscores the need for further legislative, judicial and regulatory action to remove barriers to deployment.”