FCC v. Florida Power Corp.

480 U. S. 245

February 25, 1987

In the 1980s, cable television providers often ran their cables along telephone polls  with the consent of utility companies. Congress passed the Pole Attachment Act to allow the FCC to regulate the rates that utility companies could charge cable companies in the absence of any state regulation. When the FCC required Florida Power to lower the costs that it charged cable providers, Florida Power argued that the FCC’s regulations violated the Fifth Amendment’s takings clause.

Unanimously, the Court rejected this Fifth Amendment challenge. Marshall wrote that the Pole Attachment Act did not mandate that utility companies allow cable companies to occupy its property. Because utility companies retained the right to refuse arrangements with cable companies, the law and regulations did not amount to a takings clause violation. Marshall also upheld the rates imposed by the FCC in this particular case, since the rates it mandated were sufficient to cover the costs of carrying television cables. Powell, in a brief concurrence joined by O’Connor, grumbled that Marshall should have written more analysis about an agency’s power to set rates.

Based simply on the established precedents, the Court appears to have gotten it right. Nonetheless, I’m very uncomfortable about unelected agencies being able to set prices for economic transaction, especially with such minimal judicial control to insure fair pricing. I would be very interested in a broader challenge to the authority of the FCC and other agencies to regulate in such a fashion. Bottom line: I find the entire regulatory state Constitutionally dubious.

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