US Supreme Court to decide Federal Communications Commission fund's legality

By John Kruzel

WASHINGTON (Reuters) -The U.S. Supreme Court agreed on Friday to decide the legality of a congressionally authorized fund operated by the Federal Communications Commission to expand access to telecommunications services in a challenge accusing Congress of unlawfully delegating its authority to an independent federal agency.

The justices took up an appeal by the FCC and others of a lower court's decision assessing whether Congress violated the U.S. Constitution by empowering the FCC to manage the fund. The court is expected to hear arguments in the case and issue a ruling by the end of June.

Congress in a federal law called the Telecommunications Act of 1996 authorized the FCC to operate the Universal Service Fund to promote broad access to services such as phone and broadband internet.

All telecommunications carriers contribute to the fund, which draws around $9 billion annually. The fund helps to extend service to people in rural areas, provides subsidies for low-income Americans, expands service in Native American tribal lands and assists schools and libraries.

A group of challengers including the conservative group Consumers' Research filed lawsuits against the FCC and the U.S. government, arguing that Congress delegated its revenue-raising function the FCC in violation of the Constitution.

The case involves the non-delegation doctrine, a legal concept that embraces the view that Congress cannot delegate the legislative powers given to it under the Constitution to other entities.

The FCC was established as an independent federal agency by the Communications Act of 1934 and is overseen by Congress.

Federal appellate courts have reached different conclusion on the legal question at issue in the case.

The Supreme Court took up an appeal by the FCC and other litigants of a ruling by the New Orleans-based 5th U.S. Circuit Court of Appeals that found the funding arrangement unconstitutional.

The justices have not acted on separate appeals by Consumers' Research and other interested parties of lower court rulings that found the funding arrangement constitutional.

The Supreme Court, which has a 6-3 conservative majority, has reigned in the actions of federal regulatory agencies in a series of rulings in recent years, though those cases did not involve the non-delegation doctrine.

(Reporting by John Kruzel; Editing by Will Dunham)