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A federal-state Magna Carta?

The FCC and the state public utility commissions recognized they needed one another to succeed. The FCC and other federal agencies worked with NARUC (the national organization of state utility commissioners) to strengthen cooperation.

In November 1997, incoming FCC Chairman Bill Kennard proposed a Federal-State Telecommunications Magna Charta. At the same time, state commissioners were developing specific cooperative federalist practices and proposals in a variety of areas.

The "Federal-State Magna Carta," adopted by state commissioners in early 1999, described complimentary federal and state strengths, listed areas for cooperation, outlined various approaches that could be applied in specific situations, and recognized cooperative federalist values including flexibility, diversity, and experimentation.

Federal State Joint Boards

Joint Boards of FCC and state public utility commissioners had existed under the pre-1996 law, but after 1996, their work intensified, especially for the Universal Service Joint Board, which develops detailed policy recommendations to the FCC concerning low income telephone assistance, new programs concerning Internet access for schools and libraries, rural telemedicine, and of particular concern to the rural West, support for high-cost rural telecom service.

The Joint Board has also become a vehicle for resolving differing perspectives among more urban and more rural states.

Federal-State Joint Conference

In August 1999, NARUC proposed and the FCC created a Federal-State Joint Conference on Access to Advanced Services. FCC and state commissioners held field hearings and site visits across the country, from Florida to New England, to Alaska.

Out West, a hearing in Bozeman included participants from around rural Montana using the VisionNet switched video network (part of a remarkable suite of facilities developed by consortia of Montana telecom cooperatives and small companies).

A rolling field trip from Denver to Cheyenne included stops to visit rural technology along the way, culminating in a Cheyenne hearing with Wyoming's telecom-savvy governor as the lead witness.

Other Joint Conference projects have included a survey of state approaches to broadband policy, a deployment survey tool for use by states, a study of demand-side strategies to promote access focusing on rural issues and local efforts, and two "Broadband Summits," with the second set for this April.

Consumer protection cooperation

Also in response to a state public utility commission proposal, the FCC has entered into agreements with states to coordinate anti-slamming and consumer protection enforcement, giving customers the better of either federal or state protections, with enforcement as close to the customer as possible.

And, together they created a "State National Action Plan" work group to further coordinate consumer protection and education efforts.

Meanwhile, way out West

The states served by Qwest have for roughly 15 years coordinated much of their telecommunications work and shared information through the Regional Oversight Committee (ROC), a unique effort at regional coordination in telecoms policy.

Thirteen ROC states jointly developed a detailed proposal to work with Qwest and its competitors to fulfill the local market-opening requirements of the Telecommunications Act.

The ROC Multi-State Collaborative (actually three closely related collaboratives) tackled and resolved complex technical, policy, legal and economic issues to open the Qwest local market to competition and then to keep it open.

As a result of this cooperation, Qwest was found by the FCC to be in compliance with the market opening requirements for nine states at the same time.

The Multi-State Collaborative is the largest and most successful example of regional regulation of which I am aware. It is a uniquely Western example of state-to-state, state-to-industry, industry-to-industry, and ultimately state-to-federal cooperation. It holds the potential to be a new model for collaborative, problem-solving regional approaches.

States reached general agreement on an approach among themselves. They obtained buy-in from Qwest and its competitors. Stakeholders then designed a detailed structure for testing, evaluating, resolving disputes and conducting many other discrete functions.

Reports and key documents were maintained on a Web site. Communications occurred via Web, listserv, conference call, and in-person meetings held around the West. The key federal agencies were informed and consulted at each step in the project's design, implementation and completion.

Now, the same group of states is coordinating on monitoring and enforcement of the results achieved. There is strong interest in multi-state coordination on other telecommunications policy projects.

Lessons learned

There are strong challenges to cooperative federalism. In telecoms, the growth of national wireless networks and data substitution for voice have combined to lead some to push to centralize more decision-making in Washington.

A more general pressure is the simple tendency to be results-oriented federalists: Seek the forum you think will be the friendliest. This push-and-pull debate is currently focusing on how preemptive or prescriptive the FCC should be in revising local telecommunications competition policy, with Bell companies now generally favoring federal mandates and competitive providers now advocating a much stronger state role. Six years ago, those positions were the opposite.

Cooperative federalist success depends not only on an appropriate legal structure, but the commitment and tools to make it work. In particular, parties must develop a high degree of respect for one another. They must reach a shared understanding of goals. Through experience, perseverance, and creativity, they must develop and use tools appropriate to achieve their goals, working together.

One of the West's most important federal-state regulatory disputes concerns the structure and rules for interstate wholesale electricity markets. We don't yet know whether cooperative federalism can ultimately succeed in that arena, but many are trying.

Success in regional work on telecommunications provides both hope and an example of how it might be accomplished.

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