HR-2399-119
Received in the Senate. Read twice. Placed on Senate Legislative Calendar under General Orders. Calendar No. 61.
Sponsored by Erin Houchin (R-IN)
What it does
This bill would require the Federal Communications Commission (FCC) to create a formal vetting process for companies and organizations applying for federal funding to build broadband networks in high-cost and rural areas. Applicants would be required to document their technical, financial, and operational capabilities, along with a business plan. The FCC would evaluate applications against established standards and consider each applicant's track record with other government broadband programs. After the process is finalized, only applicants who meet those standards could receive funding, and financial penalties would apply to applicants who default during the evaluation process.
Who benefits
Rural residents and businesses who currently lack reliable broadband access and would benefit from more accountable deployment of funds. Taxpayers broadly, if stronger vetting reduces failed or incomplete broadband projects. Well-capitalized and experienced broadband providers with strong compliance histories, who would be more likely to pass vetting. State and local governments that have struggled with incomplete broadband buildouts funded by prior federal programs. The FCC, which would gain clearer statutory authority and a structured process for awarding high-cost funds.
Who is hurt
Smaller or newer internet service providers (ISPs) and rural electric cooperatives that may lack the documented track record or financial resources to satisfy rigorous vetting standards, even if they are capable of serving their communities. Applicants in early stages of organizational development who cannot demonstrate an established compliance history. Rural communities in areas where fewer qualified applicants exist, potentially reducing competition for funding and slowing deployment. Applicants who default during evaluation would face new financial penalties not currently in place.
Supporters argue
Supporters argue that federal broadband funding programs have a documented history of waste and failed deployments — the FCC's own Inspector General and the Government Accountability Office have flagged cases where funds went to providers who never completed buildouts or served ineligible areas. They contend that requiring applicants to demonstrate technical, financial, and operational readiness before receiving funds is a basic accountability measure that protects taxpayers and ensures rural communities actually receive the connectivity they were promised, rather than waiting years for projects that collapse mid-deployment.
Opponents argue
Opponents argue that adding a new FCC vetting layer could disadvantage the small ISPs and rural cooperatives that are often best positioned to serve remote communities, but that lack the administrative capacity to navigate complex federal documentation requirements. They contend that overly stringent or poorly calibrated standards could reduce the pool of eligible applicants in already underserved areas, slow the pace of broadband deployment, and entrench larger incumbent providers — ultimately leaving the rural residents the bill aims to help with fewer options and longer waits for service.
Constitutional context
Congress has broad authority to regulate interstate communications and direct agency rulemaking under the Commerce Clause (Art. I, §8, cl. 3), and the FCC operates under that authority. Following Loper Bright v. Raimondo (2024), courts will independently assess whether the FCC's specific vetting standards and penalty rules fall within the statutory authority granted by this bill, rather than deferring to the agency's own interpretation — meaning the precision of the bill's delegation language matters more than it would have previously.
Checks and balances
The FCC (executive branch agency) gains authority to set vetting standards and impose financial penalties; Congress retains oversight through appropriations and the rulemaking process is subject to judicial review under the Administrative Procedure Act and post-Loper Bright independent statutory interpretation by courts.
Historical precedent
The FCC's prior administration of the Connect America Fund and E-Rate programs involved similar eligibility and capability reviews, and the GAO and FCC Inspector General have repeatedly recommended stronger pre-award vetting following documented cases of funding misuse in those programs.