Supreme Court rules 6-3 in favor of Congress outsourcing power to agency-selected nonprofit

In a 6-3 ruling on Friday, the Supreme Court sided with the Federal Communications Commission (FCC) in a case filed against it over its administration of a program to deliver telecommunications services to underserved communities.

"The question in this case is whether the universal-service scheme—more particularly, its contribution mechanism— violates the Constitution’s nondelegation doctrine, either because Congress has given away its power to the FCC or because the FCC has given away its power to a private company. We hold that no impermissible transfer of authority has occurred," Justice Elena Kagan wrote for the court.

"Under our nondelegation precedents, Congress sufficiently guided and constrained the discretion that it lodged with the FCC to implement the universal-service contribution scheme. And the FCC, in its turn, has retained all decision-making authority within that sphere, relying on the Administrative Company only for non-binding advice. Nothing in those arrangements, either separately or together, violates the Constitution."

She wrote that when Congress amended the Communications Act in 1996, "it provided the Commission with clear guidance on how to promote universal service using carrier contributions. Congress laid out the 'general policy' to be achieved, the 'principle[s]' and standards the FCC must use in pursuing that policy, and the 'boundaries' the FCC may not cross."

"Our precedents do not require more. Nor do they prevent the Commission, in carrying out Congress’s policy, from obtaining the Administrator’s assistance in projecting revenues and expenses, so that carriers pay the needed amount. For nearly three decades, the work of Congress and the Commission in establishing universal-service programs has led to a more fully connected country. And it has done so while leaving fully intact the separation of powers integral to our Constitution."

In the dissent, Justice Neil Gorsuch wrote that Congress "alone as access to the pockets of the people," and that "The Constitution affords only our elected representatives the power to decide which taxes the government can collect and at what rates."

"Today, the Court departs from these time-honored rules. When it comes to 'universal service’ taxes, the Court concludes, an executive agency may decide for itself what rates to apply and how much to collect. In upholding that arrangement, the Court defies the Constitution’s command that Congress 'may not transfer to another branch ‘powers which are strictly and exclusively legislative.’"