Supreme Court may uphold programs aimed at bringing internet to rural, poor neighborhoods

(CNN) — The Supreme Court appeared sympathetic Wednesday to a series of programs geared toward expanding high-speed internet in rural and poor communities, despite a challenge from a conservative group claiming funding for that effort violates separation of powers principles.

After nearly three hours of argument, several of the court’s conservatives – along with all of its liberals – raised concerns about a ruling that could upend the way other federal agencies function, including the Federal Reserve and the Securities and Exchange Commission.

If the court upholds the structure of the Federal Communications Commission’s funding for the programs, it would represent a departure from its trend in recent years of significantly limiting the power of agencies to act without explicit approval from Congress.

“These are the services that all the rest of us take for granted that you can’t take for granted in rural North Dakota,” Justice Elena Kagan, a member of the court’s liberal wing, said in summarizing her reading of the law. “And what this program says is that rural North Dakota citizens should also get what all the rest of us have long had.”

Congress created the Universal Service Fund in 1996 to pay for efforts to expand broadband and phone service in rural and low-income urban parts of the country. Telecommunications companies contribute billions to that fund – a cost that is passed on to consumers – to pay for programs like E-Rate, which lowers the cost of high-speed internet for libraries and schools.

‘We have a tax that’s unlike any other tax this court has approved’

A conservative “consumer awareness group” challenged that fund as an unconstitutional “delegation” of the power of Congress to levy taxes. What’s worse, the group argues, a private entity calculates the amount of money that must be contributed. The Supreme Court has not invoked the nondelegation doctrine – or the idea that Congress cannot delegate its authority – since the 1930s. It has, for decades, permitted delegations under certain conditions.

Conservative groups have argued the federal agencies have perverted separation-of-powers principles, allowing government agencies to take the lead on difficult choices they say should be left to lawmakers. In this case, they said, it has also allowed Congress to escape paying a political price for taxes.

Several of the court’s conservatives, including Justices Clarence Thomas, Samuel Alito and Neil Gorsuch, pressed hard on the idea that there was little accountability for the way the government has structured the program.

“This just a straight up tax without any numerical limit, any cap,” Gorsuch said. “We have a tax that’s unlike any other tax this court has approved.”

But other conservatives, including Justices Brett Kavanaugh and Amy Coney Barrett – both key votes – seemed skeptical that putting a cap on how much the fund could raise would solve the problems critics have raised.

“Your position would say that a solution to the problem … could be a trillion-dollar cap,” Kavanaugh said.

That number, he said, “could be very high. And then the question is: What exactly are we accomplishing?”

The law allows the FCC to raise a “sufficient” amount of money to accomplish the broad goal of universal access to telecommunications.

“We would be saying, I think, if we agree with you, ‘sufficient’ is not good enough but a ‘trillion dollar’ is, and I think a lot of people would say, ‘that doesn’t make a lot of sense,’” Kavanaugh said.

The unusual politics of the case created a striking dynamic during the arguments Wednesday in which the court’s liberal wing appeared to be siding with the attorney representing the Trump administration, acting Solicitor General Sarah Harris.

“The easiest parts of an argument are where you just have to say ‘yes’ to everything,” Kagan quipped with Harris after she delivered a series of affirmative answers to Justice Sonia Sotomayor.

Harris faced much tougher questioning from the most stalwart conservative justices.

The Biden administration appealed a ruling from the 5th US Circuit Court of Appeals that struck down the funding mechanism. Under Trump, the Justice Department continued the case, warning the court in a brief that “Congress has relied on this court’s longstanding” approach to the issue to enact legislation authorizing agencies to police unfair competition, oversee the securities industry and ensure the safety of food and drugs.

The Supreme Court’s 6-3 conservative majority has in recent years hacked away at the power of federal agencies to act on their own, most recently in a 6-3 decision last year that overturned a 1984 precedent requiring courts to give deference to agency regulations in many circumstances. Federal agency power expanded dramatically after the New Deal, Chief Justice John Roberts wrote for the majority, and courts had veered too far from exercising independent judgment about whether an agency had violated the law.

That decision came on the heels of a blockbuster ruling in 2022 that embraced the so-called major questions doctrine, which bars an agency from issuing a rule with major economic or political impacts absent explicit approval from Congress.

A decision is expected in June.

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