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FCC Is Third Most Expensive Agency of Federal Government

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FCC Is Third Most Expensive Agency of Federal Government

High Cost of Spectrum Management, Broadband Regulation Biggest Problems

WASHINGTON, D.C., February 21, 2013 - Somewhat surprisingly, the Federal Communications Commission (FCC) is the third most expensive agency when it comes to the costs imposed on Americans by its regulations.

According to a report released today by the Competitive Enterprise Institute’s Center for Technology and Information, Americans spend $142 billion per year to comply with FCC regs.  That puts the FCC behind only the Department of Health and Human Services ($184.8 billion) and Environmental Protection Agency ($353 billion), in terms of costs of regulations.

The costs could be even higher, but it is hard to gather the data because of an alarming lack of transparency. Important information, such as the number of FCC regulations in the books, how many more are on the way and how much they cost, are scattered among obscure sources. This from an agency that enforced more than 25,000 specific regulatory restrictions in 2010 and added 108 more last year.

For one example, wireless spectrum regulations and broadband regulations are the two biggest drivers of FCC compliance costs, but the best estimates of those date to 2005 – hardly an accurate picture today. At that time, according to Jerry Ellig of the Mercatus Center, wireless spectrum regulations cost $77 billion in “higher prices and foregone wireless usage,” and broadband regs cost another $27 billion.

For another, FCC imposes regulation without representation. After Congress rejected net-neutrality regulations last year, the FCC issued its own rules, which would be effect and visiting billions more in compliance costs on Americans if not for numerous court challenges. For still another, the agency plans to auction wireless spectrum in the coming months, but Verizon and AT&T – two major players in the American telecom industry – fear they will be shut out for political reasons, which would harm their data-hungry customers and deprive the government of billions of dollars in potential revenue.

“Americans truly do not know – and, in large measure, cannot find out – what they are paying for this regulatory regime or what this agency is up to,” said Ryan Young, CEI’s Fellow in Regulatory Studies and author of the report card. “The basic principles of transparency and open government are ignored, and this undermines Americans’ trust in government.”

> View the report, Regulatory Report Card: FCC

> See also: Regulatory Report Card: Environmental Protection Agency