undoubtedly heard, four million americans wrote the fcc to make known their ideas thoughts and deeply held opinions about internet openness, they lit up our phone lines, clogged our e-mail inboxes and jammed our online comments system. that might be messy, but whatever our disagreements are on network neutrality, i hope we can agree that's democracy in action, and something we can all support. now, with an eye to the future, i want to talk about two other things today the need for more wifi, and the need to bridge the homework gap. first, wifi. few of us go anywhere today without mobil devices in our palms, pockets or purses. every day in countless ways our lives are dependent on wireless connectivity. the demand for our airwaves grows, the bulling of our policy

policy -- this is good but we also need to give unlicensed services and wifi its proper due. after all, wifi is how we get on line in public and at home. wifi is also how our wireless carriers managed their networks, in fact today nearly one half of all wireless data connections are at some point offloaded on to unlicensed spectrum. wifi is how we foster innovation, because the low barriers to entry for unlicensed airwaves make them perfect sandboxes for experimentation. and wifi is a boone to the economy. the economic impact of unlicensed activity has been estimated at more than $140 billion annually. by any measure, that's big. so we need to make unlicensed services like wifi a priority in

our spectrum policy, at the fcc, we are doing just that with our upcoming work. it's going to take more than this to keep up with demand. that's why i think the time is right to explore greater unlicensed use in the upper portion of the five gigahertz band. i think going-forward we're going to be on guard to find more places for wifi to flourish. second, i want to talk about another issue for what matters, that's the homework gap. today, roughly 7 in 10 teachers assign homework that requires broadband broadband. one in three households lack access to broadband at any speed. think about those numbers. where they overlap is what i call the homework gap. and if you are a student in a

household without broadband just getting homework done is hard. applying for a scholarship is challenging, and while some students may have access to a smart phone, let me submit to you that a phone is it not how you want to research and type a paper, apply for jobs or further your education. this is a loss to our human capital, because it involves a shared economic future that we need to address. the homework gap is the cruelest part of our new digital divide. it's within our power to bridge it. more wifi can help, as will our recent efforts toup grade wifi connectivity. more work remains. i think the fcc needs to take a harder look at modernizing our low income households and especially those with school aged children. and i think the sooner we act,

the sooner we bridge this gap and give more students a fair shot at 21st century success. thank you. >> thank you. >> commissioner, we appreciate your testimony. those bells went off, or buzzers as we so lovingly say. we have two votes we should have time to get through the commissioner's testimony we'll come back immediately after votes to resume questioning, welcome, thank you for being here, please go ahead with your testimony. >> chairman wald nen thank you for giving me the opportunity to testify here today. it's been an honor to work on a broad range of issues. i last testified in front of the subcommittee more than a year ago. since that hearing, things have changed dramatically at the fcc. i wish i could say these changes

on balance have been for the better, and unfortunately has not been the case. the foremost example is the fcc's decision last month to apply title 2 to the internet. the internet is not broken, the fcc didn't need to fix it. our party line vote overturned a 20 year bipartisan consensus in favor of a free and open internet. with the title two decision, the fcc voted to give itself the power to micro manage virtually every aspect of how the internetworks. the fcc's decision will hurt consumers by increasing their broadband bills and reducing competition competition. the title two order was not the result of a trans parent process. the fcc has already lost in court and its latest order are guaranteed to meyer the litigation for a long time. turning to the designated entity program. the fcc must take immediate

action to end its abuse. what was once a well intentioned program designed to help small businesses has become a play pen for corporate giants. the recent us-3 auction is a shocking case in point. dish, which has annual revenues of $14 billion and a market cap of over $34 billion, holds an 85% equity stake in two company s s. that makes a mochrie of the small business braham.program. the $3.3 billion at stake is real money. it could be used to underwright pell grants, fund school lunches. incentivize the hiring of 138,000 veterans for a decade. the abuse had an enormous impact on small businesses from nebraska to vermont. it denied them licenses they

would have used to provide consumers a competitive alternative. the fcc should quickly adopt these changes. the fcc is at its best when it acts in a bipartisan manner. during my service under chairman janikowski 80% of the issues were unanimous. since november of 2013 only 50% of votes at fcc meetings have been unanimous. this level of discord is unprecedented. indeed there have been 40% more party line votes at the fcc in the last 17 months than there were under the entire chairmanships of janikowski and clyburn combined. i'm concerned that the commission's longstanding

procedures and norms are being abused in order to freeze out commissioners. it's been customary at the fcc for bureaus to issue significant orders to provide those items to commissioners 48 hours prior to their scheduled release. back then if a commissioner asked for the order to be brought up for a commission level vote that request from a single commissioner would be honored. recently however, the leadership has refused to let the commission vote on items where two commissioners have made such a request. given this trend as well as others. i commend the subcommittee for focusing on the issue of fcc process reform. finally, i would like to conclude by discussing an issue where it should be easy to reach consensus consensus. when you dial 911, you should be able to reach emergency personnel, wherever you are. but unfortunately, many properties that use multiline telephone systems require

callers to press nine or some other access code before dialing 911, this problem has led to tragedy. unfortunately, the phone systems are not con figured to allow direct 911 dialing. recognizing this problem, congress directed the general service administration to issue a report on capabilities of telephone systems of all federal buildings -- i recently wrote to gsa to inquire about the status of that report. i was disturbed to learn by a press report a couple days ago the gsa never completed it. the fcc's headquarters is one such federal building where direct 911 dialing does not work. but as the ranking member recently observed. when it comes to emergency calling, the fcc would be the example not only for the rest of the federal government but for the entire country. i commend her and the

congressman for the leadership on this issue. thank you once again for inviting me to testify, i look forward to your questions and looking forward to you and your staffs in the days to come. >> thank you we now turn to the fourth commissioner. >> thank you, mr. chairman i've held the energy and commerce committee in the highest regard overseeing hearings and responsibilities that you have to face every day. i applaud the subcommittee for focusing on this issue of reauthorizing the fcc. i recommit myself to being available with any resource i can in the future. in my time at the commission i've enjoyed the many intellectual and policy challenges presented by the innovative and challenging communications center. it's my goal to maintain friendships, even when we

disagree. and seek out opportunities when we can work together. i voted with the chairman on approximately 90% of all times. this percentage drops significantly, to approximately 62% for the higher profile open meeting items. one of the policies i have not been able to support is the insertion of the commission into every aspect of the internet. the commission pursued an ends justified the means without a shred of evidence that is even necessary, solely to check the boxes on a partisan agenda. even worse, the order reviews current and future internet practices under vague standards, such as reasonable interference and reasonable network management. this is a recipe for uncertainty for our nation's broadband procedures. nonetheless, i continue to suggest creative ideas to modernize the regulatory

environment. i've written extensively on the need to inform numerous outdated commissioners. i've advocated any document to be considered an open meeting should be made publicly available on the commission's website at the same time it's circulated to the commissioners typically three weeks in advance. this is not tied to the item, it provides a great example why change is needed. under the current process i meet with numerous parties. i'm precluded from telling them, having read the document that their concerns are misguided or already addressed. this could be a huge waste of time for everyone involved and allow some favored parties in the unfair advantage. the stated objections to the approach presented under the cloak of procedural law are really grounded in resistance to change and concerns about resource management, in addition, the commission has a questionable post adoption process that serves significant

intention. i generally refrain from commenting on legislation. i appreciate the ideas approved by this subcommittee and ultimately the full house last congress to keep the public out of the critical end stages of the deliberative process. i believe these proposed changes as well as others, would improve the functionality of the commission, and improve consumer access to information. i would turn the subcommittee's attention to a host of other practices that i believe deserve attention. the 40 hour notification my friend mentioned, testimony provided by outside witnesses and the commission open meetings delegating vast authority to staff to make critical decisions or set policy, the regulatory flexibility act and paperwork reduction act compliance. and accounting for the assessed penalties, separately, i've been outspoken on many issues such as the need to free up spectrum resources for wireless broadband both licensed and unlicensed.

i look forward to working with my colleagues on is this issue in the months ago. >> thank you, we appreciate your input. we will recess now so that members can go to the house floor and vote. please return as promptly as possible, as we will begin our questioning thereafter. we stand in recess, we have two quick votes. we're now into the questioning phase from the members of the committee we want to thank all of you for your testimony today. the work you do with all of us every day. we appreciate that throughout the debate on the internet proceeding, i was amused there

were some comparisons to what former chairman martin did or didn't do. he wrote a late in the day op ed put out a public notice, testified before congress, he didn't do a further notice of proposed rule making that seems to be request why the third circuit threw his ownership rule out. i guess appellate judges don't think much of op eds or congressional testimony. they think the agency should go through the procedural steps to make sure that all interested parties, even those outside dc policy circles get an opportunity to understand significant shift in direction and have a reasonable amount of time to comment. i have a couple questions and perhaps i'll direct them to commissioner pike. how many conclusions found in the mprm were reversed in the

final order? >> virtually all of them? >> how many of the commissions -- what number paragraph says the commission planned to assert its authority over ip addressing, was that in the mprm? >> it was not. >> what number paragraph put the public on notice that the commission intended to redefine the term switch network. >> there is no such paragraph. >> there are a number of issues that are pending at the commission, and i know the chairman's had a lot on his plate, you all have. it's a rapidly changing environment, you have limited resources and all. some of you heard me talk about our applications when i was in the radio business, 10 years waiting, 30 days to celebrate the requirements. we get a lot of input here.

just because of limited time has the commission acted on the am modernization order yet? >> it has not yet it was adopted about a year and a half ago. the record is complete. >> there's another issue that came up, i was speaking at a group, and it involves this issue to allow small cable operators to operate as a buying group for the purchase of content, has that been acted on yet? that's been pending for some time i'm told? >> it has not. it was voted on three years ago. >> i recall it was the summer of 2012. i'm not sure what the status is, i stand ready to vote. >> my understanding is the commission has not yet issued its review of media ownership rules for 2010, i believe that's about five years ago, is that correct? >> five years ago, but december of 2007 was the last time the actual rules were adopted.

>> has that been eight years since -- >> season the that a statutory evaluation. >> what about the work on the connect america fund. has the commission finished the work on how they will work in the mobil support mobil? >> my understanding is not yet, but the work is underway. >> these are some of the things that trouble us to say the least we also had an issue come to our attention involving the western amateur radio friendship association interference case. maybe i can direct this to you i understand it's been going on for quite a while and is quite disturbing. i've been told about some of the audio recordings, allegedly there's this jamming that's included. really awful repulsive racial epithets. and threats against a female member. it's come to our attention this

has been sitting there for a while where these operators are jamming and using really awful language. do you know the status of that? can you give us some update on that? >> i can't give you an update on that. >> i think it's called the western amateur radio friendship association interference case. i guess there are a couple of these that -- involving pirate radio operators. which leads into a discussion, and i'm going to run out of time here, about the closing of the regional offices, when we had the cfo, i guess, the close managing director here we weren't really brought up to speed or advanced noticed at least that you're going to close these regional offices isn't that where this enforcement activity takes place? >> mr. chairman? >> that's fine. >> yes, indeed, i think the field office is the enforcement

bureau performed one of the core functions which is to protect the inteer ference among other things. obviously i'm still studying the issue congresswoman clark expressed concern. we want to make sure however it's reorganized we protect the public interest. >> we clearly don't have -- it would leave only two offices, only one in l.a. and one in san francisco. i was pleased -- >> can i get -- there's multiple things going on. first of all we need to make sure that in flat budgets or reduced budgets that we're spending our money efficiently. when you have more trucks than you have agents which is the reality that exists today -- >> i'd sell trucks. >> you have to ask yourself a question, are you distributing resources as they ought to be

distributed? when you've got one manager for every four people. you say to yourself is this the right kind of structure? >> i fully agree? >> how do you fix that? >> i -- what we'd like to have is the backup for this -- i think we have a request pending for that. >> i think you -- if my understanding is correct, you asked for the consultant's report, the final consultant's report is not -- and you will have it. >> when i have it. >> i've seen a draft of the structures. we've also sent it back for more detailed -- >> i appreciate the inactual against -- i recognize the gentle lady from california. >> thank you mr. chairman. welcome again to the entire

commission. it's obvious that we have different takes on the issues but i -- i sincerely thank you for your public service. and to commissioner o'reilly. this is a graduate of this committee. you were here under chairman blyly, who i had the pleasure of working with, and getting a lot of things done together, so welcome back. thank you for your advocacy on the 911 issues, you know that the mother and father, the mommy and daddy of this are right here at the committee. congressman and myself founded that caucus, and then helped -- >> well, we did -- what's so funny about that -- i think it's terrific. when no one was paying attention to those issues, it was before

our country was attacked. commissioner rosen, thank you for your clarity and your passion when you speak. and commissioner clyburn go get 'em. to the distinguished chairman. i don't know how many people realize this about the chairman he is a man of history, i want to pick on the vein of history, i think it's very important for us. around here, life is incremental, it's incremental anyway, god gives us life a day at a time. those are increments. i think what i'd like to do is have you and i want to say a few things about it first, to widen the lens of what is before us today in terms of history.

now, the majority has defined or tries to define net neutrality with some very scary things. they call it railroad regulation, billions of dollars in taxes, new taxes are going to be levied no investment is going to be made, the market is going to be chilled. in terms of history we've been through the stone age you can the bronze age, the iron age, the age of invention the industrial revolution the technology age and now the information age. and i think why this is difficult for some to actually see, and when you see something you either get it or you miss it. we are at a moment in our

nation's history where we're moving to a new age. i would say that those that are on the other side of this erissue are back in an older age where you have huge corporations gatekeepers duopolies. that is not what the internet is all about. i would like you, as a historian, to address what this moment is and place it on the stage of history. >> we don't have very much time. i have a minute and 40 seconds left. >> i think that we're living through the fourth great network revolution in network history. if you look at those what

you'll find is that every single time. it was the end of western civilization as we know it that was being -- people who didn't want to embrace the change would say, this is awful. i have hanging in my office a poster from 1839 that was put out by people who are against the interconnection of railroads, and it was all patterned around women and children are going to be hurt by this it was paid for by all the people whose businesses would be affected because the ofs would interconnect. yet that interconnection drove the 19th and 20th century. we always hear these imaginary horrible s horribles. and we also always end up saying as a society we need rules. we need to have a known set of

rules. we need to have a referee on the field who can throw the flag, and that is the process that we have gone through since the beginning of time. we have the privilege of living through that and trying to deal with those realities today. >> "think that's magnificent in the short period of time. i wish i could question. i have questions for all of you i'm going to submit them to you, and with that, mr. chairman, i would like to ask unanimous con ten sent that the congressman's questions be submitted for the record, he's a guest of our subcommittee today. >> without objection. >> and demonstrates his great interest in the issues at hand, and another from many, many -- i don't know, maybe 50 racial justice and civil rights organizations who have addressed a letter to the chairman and

myself in support of net neutrality. >> without objection. >> thank you mr. chairman. >> the lady yields back. the next questioner will be the gentle lady from tennessee. >> thank you mr. chairman. i appreciate that. chairman wheeler, i will just add my viewpoint of when you look at our economic revolutions in society whether it was agricultural or industrial. the technology, the information, successful revolutions are about freeing up not restricting. and what we're looking at right now, is at the vantage point that you all are coming from is taking away and restricting not freeing up. mr. o'reilly commissioner o'reilly, let me come to you for a moment and talk taxes. you and i pinned an op ed back in july calling for the need for a cost benefit analysis.

and really looking at what had been said by ppi free press. what they thought would happen with taxes, new york times agreed with that. i want to hear from you a little bit, 30 seconds worth about why we should have had a cost benefit analysis, and what you think the outlook is. >> i believe we should do better, and this is a perfect case. >> none was done? >> this is a woeful job that was done in this instance. we're talking about hypothetical harms and real world impacts. in terms of your questions on taxes. i would switch more to taxes and fees. the question has been on universal fees and service going-forward. the item in and of itself before us does not impose universal service. that is something we're going to punt for a month or two, and we're waiting for the joint board. we're going to see those fees in

the months ago. >> okay. you gave an interview this week and stated there's going to be a tax on broadband, and the commission is waiting for a joint board to decide april 7th how large that tax is going to be. you want to expand on that? >> the order suggests the joint board is going to make a recommendation on april 7th a short deadline might be appropriate. so at some point very soon the joint board is going to recommend whether and how to increase these fees that are going to be assessed on broadband for the first time. it's state and local fees, for example, state and property taxes. localities also impose taxes. an 11% tax on gross receipts these are all fees that are going to have to be paid by someone. >> chairman wheeler i read something from professor lyons he said title ii is a regime for

regulation. and then we're looking at another thing what you said about a person which might include a large company, can file a complaint with the fcc under section 208 if they don't think their charges are just and reasonable. you have denied that the fcc is going to get into regulation through this net neutrality order. but i understand that the order does not explicitly state that the fcc will be regulating rates on the date the rules are effective. but what about the first time that a complaint is filed with the fcc, under section 2008 because the party feels their rates are not just and reasonable. what's the remedy going to be? and isn't it true that the fcc will be engaged, there by in de facto rate regulation. >> thank you congresswoman.

i hope somebody files that kind of a complaint. as you know there hasn't been a complaint filed for 22 years in the wireless voice space, despite the fact that the same kind of authority exists. if somebody files that kind of complaint, i don't want to prejudice a decision, i will assure you that there will be a pro process that will look at that and that will develop a record that would make it very clear that the fcc is not in the consumer rate regulation business. >> mr. chairman, don't you think what you just said about there hasn't been a complaint filed in the space for 22 years proves the point that the internet is not broken. the space is not broken, and it does not need your oversight and guidance? >> i was referring to wireless voice, not to broadband. >> you cited your -- >> let me cut you off.

i have one question for commissioner clyburn i want to go to the lifeline with you, you've advocated restructuring and rebooting that program and you've had several supply side reforms, aimed at incentives for waste, fraud and abuse, the fcc's inspector general has performed a review of the verification process on this. and recommended that the fcc may improve the effectiveness of the warnings that it gives subscribers and reduce the level of fraud in that program, we've had hearings on this, and i want to work with you on it. is it true that under the current system, the penalty for a subscriber defrauding the program by having multiple funds is to lose the subsidy for that -- those phones, all but one, they get to keep one, and then the carrier is prosecuted.

i tell you why your answer is important. you are talking about getting the end of broadband. and then in addition to the phones, and you got to reform all of this before you talk about expanding. >> i totally agree. >> one of the reasons i said -- we need to eliminate all incentives and all existing waste, fraud and those abuses. we need to do that, and the key way to do that is to get those procedures out of the certification business. they will no longer green light customers. >> we need to prosecute the user. >> and -- >> not the -- >> and we have under -- with guidance from my colleagues and while i was acting chair -- >> i yield back my time has expired. >> the chair now recognizes the gentleman from new jersey, the ranking member for five minutes.

>> thank you mr. chairman, i just want the commissioners to know many district by ravished by hurricane sandy in 2012 one of the most concerning impacts of the storm was the loss of communications services, a lot of people couldn't call their friends or family. and 40% of our cell towers were knocked out in the state. a lot of people basically learned the hard way, when the power lines go down, communications services go down. go down along with electricity. i wanted to ask the commissioner, i know you toured new jersey after sandy i asked what lessons did you learn about how to prevent these kinds of communication failures during future emergencies. >> thank you for the question. i did tour the new jersey shore with public safety officials following hurricane sandy, i won't long forget what i saw. a lot of broken homes and businesses, and cars and boulders strewn this way and that, and piles of sand many

blocks from where the ocean is because wind and water had delivered it there. i also saw a lot of people were committed to rebuilding, and i learned a lot about how communications succeeded and failed during that storm. what stuck with me was that many of the wireless towers in the affected areas went out. throughout the ten states that were impacted by the storm about a quarter of the wireless cell towers went out of service in new jersey as you mentioned it was about 40%. i would bet the number was significantly higher on the new jersey shore. and in the aftermath of learning those things we were able at the agency to start rule making, to ask, how can we fix this going-forward? we know that 40% of all households in this country are wireless only. in the middle of a storm, at the very least, they should be able to connect and get the help they need. we issued a rule making in 2013

and among the issues discussed in that was the question of how much backup power is necessary and how much of a reporting duty our wireless carriers should have when these sites go out of service. i hope we can turn around and deliver a decision on that in short order, we don't know when the next storm is going to hit, but i'm pretty sure people are going to try to use communications when it does. >> thank you. i understand the fcc was mentioned, considering updates to the rule ss. can you commit to updating those rules this year? >> the issue that commissioner rosen raised is a paramount issue. there's broader issues and that is the whole issue of copper retirement which got forced by sandy. how do we make sure that when the power goes down, and you're relying on fiber, which zntz

carry its own power, you have the ability to make a 911 call we have a rule making going that literally just closed last week. all of the issues interrelate but first and foremost in our responsibility which is why i focused on the 911 location issue in my statement. first and foremost in our responsibility is public safety. >> i wanted to ask you about the designated entity rules obviously small businesses are so important in my state and elsewhere. i don't think small businesses can survive in intensive industry haves without some smart public policy. i'm concerned that the current rules for small businesses still contain bush era loopholes that allow large corporations to gain the system. i introduced today to update the rules at accessing the nation's

airwaves. i'll start there's not much time left, we'll start with chairman wheeler, if the others want to chime in, would you commit to working to maintain a robust entity program focused on genuine small businesses. >> you wrote us and asked us that and i replied yes we will and yes we are. we have had a rule making going on, and we will issue shortly a public notice making sure it is broadened out, the discussion is broadened out, the record is built on the question of the recent a to b west three auction and some of the very legitimate concerns that have been raised about that. the thing that is frustrating to me, congressman, you say yes these were bush era rules, they haven't been reviewed since then, and it is time to review them. what is really upsetting is the way in which slick lawyers come in, and take advantage of rules

that this committee, i was in the room, this room, when this committee created designated entities and as you say, the world changes dramatically in how a designated entity can be structured, in now what is a big market. before it was a much smaller market. our rules have not kept up the slick lawyers have figured out how to do it, we want to make sure whether it's this or slick lawyers playing around with broadcast licenses, that there is no way we keep our rules current. and we are going to do that on this issue and we are going to make sure the commitment that i will iron clad give you, is that we want to make sure we have a new set of dea rules in place before the spectrum auction that takes place early next year. >> thank you. time is expired, we yield back. the chair recognizes himself for five minutes. again, thanks very much to the commissioner for being here

today. in january, the fcc voted to update the broadband network speeds to three mega bits per uploads. the speeds had consented at four mega bits per secretary. i understand the need to update the broadband speeds i'm curious as to the process the commission chose the speeds of 25 mega bits and the three mega bits. it seems to an outside observer that an arbitrary number was picked, especially considering that recently the commission voted to spend $10.8 billion through six years. according to the commission's new benchmark 10 mega bits per second would no longer be considered broadband. also you follow up and how does it still plan to spend over $10 billion on those 10 mega bits per second in light of that new

definition. >> thank you for the question. i think the problem is, the agency has viewed each of these issues in a vacuum. when we were talking about broadband deployment, we established what we considered to be broadband at the time which is 10 mega bits per second. fast forward one month, broadband is 25 mega bits per second, under which standards there's no such thing as broadband. flash forward one month more we learn there is such a thing as mobile broadband it's going to be classified as a title 2 service. the schizophrenia we've seen as to what is broadband illustrates the point we need intellectual consistency that is grounded in the facts. the facts stem from the question, what do people use if you look at my statement with respect to the january order, i was trying to look at patterns of usage,

obviously there are going to be some folks who use the internet for very high bandwidth applications, others who use it for less. the goal of the fcc shouldn't be to artificially pick a number so it can declare the broadband marketplace is competitive, they should try to taylor with some forward thinking what broadband means in the occurrence era, and that's why i think the standard would be jettisent is based on more press release grasping for press outlines as opposed to what is in the record. >> let me follow up i'm also concerned that this new threshold -- if you look at my district and you've seen it, it could ultimately deter the competitive entry into the broadband market. >> that's a great question

congressman, coming from a rural area myself that's something i take personally. the fcc heard from a great number of small providers in rural areas, who told us that title ii ironically would take us in the opposite direction of getting more competition. a lot of folks in rural areas if they have an option it's going to be from one of these smaller procedures. we heard from 43 municipal broadband providers, raise our costs and hinder our ability to further deploy broadband. we heard from 24 small broadband providers who said that title ii will badly strain our limited resources, we have no inhouse attorneys and no line items for council. those isp's serve four customers in cannon falls, with the noegsz that main straight broadband exerts some kind of monopoly is

absurd, i think that's part of the reason why the obama administration's small business administration was on point when it urged the fcc to take a careful look at how these rules would affect small businesses, ultimately that is where the divide is going to open up it's for the rural americans who have a tough time getting a broadband option as it is. >> i would like to ask a question now. the chairman mentioned in his opening statement about starting the task force i'm curious commissioner, where did you find out about the task force? >> when did i find out about the actual task force? >> to the best of my knowledge last quarter of last year, issued a report in february there was an interactive process, they asked each office to weigh-in, and that is when -- subject to check my memory's -- sometimes a challenge, but last quarter of last year with the

february -- >> thank you. commissioner? >> i believe they issued a report sometime last year but i would have to go back and check. >> if you're referring to the task force the chairman announced this morning, is that the one? >> he explained about it in his opening testimony. >> then i learned about it this morning when he announced it. >> commissioner riley? >> i just learned about it this more than. >> my time has expired, and the chair now recognize ss mr. doyle. >> i want to recognize my league and the historic step forward the commission has taken. millions of americans called on

the commission to take action. innovators shouldn't need to ask permission and the fcc's actions will ensure this remains true. i want to point out one more thing. my colleagues have been talking about title two, like it's the end of the world. up until 2002, the internet was treated as a title ii service. it was the commission that accounted to reclassify the -- i see this rule as the fcc finally setting things straight. chairman wheeler last september, you testified before the house small business committee, you were asked about net neutrality proceedings, and you stated title 2 is on the table. now, my republican colleagues are making the allegation that you only started looking at title ii as a result of white house interference in november of 2014. was the 23 cc considering using

its title 2 authority before president obama joined millions of americans in calling on the fcc to take that course of action? >> yes, sir. and the small business committee that you site there was one member who was saying to me don't you dare do title ii and i was saying we're seriously considering title ii, there was one member who was saying we want you to do title ii yes, we're considering doing title ii. >> thank you. let me ask you another question. the open internet order makes great strides. by including interconnection and protections through consumer privacy. i want to get your commitment that the commission will move quickly to complete the rule making on section 222 and ensure the commission has rules in place to protect consumer privacy online, i'd also like your commitment that the commission will take seriously

this responsibility on interconnection. with all the recent announcements releasing new streaming video services, i think it's more important than ever that gatekeepers do not restrict these new services accesses to consumers also mr. chairman. i would be remiss if i didn't take the opportunity to ask for special access. i would encourage you to move as quickly as possible. and to take action to address any harm's taking place. fixing this situation is a great opportunity to improve competition and economic growth across this country. >> let me see if i can go through 1, 2, 3. >> one on privacy. absolutely sir it starts next month, when we're holding the workshop that gets the parties together and says, okay let's talk specifically about how section 222 exists in this new reality next month. and then we move after that. secondly with regard to

interconnection i could not agree more with your point about how over the top services are revolutionizing and are going to be the services are revolutionizeing and will be the consumers savior. it is a bipartisan belief that something has to be done about cable prices and that starts with alternatives and those alternatives are delivered over the top, and those alternatives are delivered via the internet. so that is why the internet has to be open. my hair was not gray when i first started asking for special access. we are in the process, we have just gotten permission and begun the data collection on special

access. it is incredibly important that is particularly essential to those bringing competition to communication. and my goal is that we're going to have this whole special ac the table and dealt with before the end >> thank you, one last thing. this question is on the aws auction. it raised 45 billion in revenue meeting all of the funding targets including fully funding next gen 911. haven't the fcc been fully liberated and the incentive option. >> that is one of the issues that we will be addressing again as we put together the final rules for the option. i understand your point that we have now lived up to our committed obligation and this is

an issue that we will be dealing with in the coming months. >> one of the things that i joke about, a positive joke is that all predictions were wrong. that two-and-a-half to three times the amount of money was raised, and we will include to continue the incentive option to deliver to the american people. >> i agree with the chairman. we will be looking at this in the next few months. it is important that we follow the statute and it is important that everybody has opportunities to bid in this auction and that no singer player walks away with the spectrum. >> >>. >> without on section. >> the gentleman yields back.

the chairman now recognizes the gentleman from illinois. >> welcome it is great to have you here. i want to be careful because history does tell us a lot of things. i was fortunate enough to be on the committee and chairman upton took us to ground zero because we had a verizon switching station across the street. what i learned walking through that process, it was really only a big company that could get wall street back online after that catastrophic attack and it is true. i still have pictures. the basement was flooded. wires going up to the third floor, you had individuals hand tieing the copper lines. so as we talk about our competition and large entities sometimes they're very important in the security of this country.

and i want to, also, thank you for the kind words on 911, it was a team effort. it is a process you have to stay vigilant on as you mentioned. first we dealt with 911 over cell, and then went to location. and then we went to voice over internet, now we're back in the location. because i'm being told by some that there are really too many right now and they should maybe centralize those. any comments briefly if you can. >> one of the interesting things that was in your bill was you asked states to voluntarily have state-level coordination of their pcaps. and by and large that has been

observed. it hasn't existed. there is no state level coordination in georgia as i spoke about. introducing mobile means the people on the right side and the people on the left side of the map need to be able to talk to each other and have similar standards. you tipped off some of the issues, the other is text to 911 which we have required carriers to do. and of the 6500 in the country 200 have implemented it. that means america's deaf and hard of hearing community, which thanks to the unanimous action of this commission has text to 911 capabilities provided by carriers, they can text away. >> i guess the other thing that we did not talk about was the testing that you did on the elevation.

i would say the elevation -- >> yes. >> and i'm very excited about that opportunity. i don't have much high-rises in my district but i know it's probably difficult in large metropolitan areas. give me some comfort my concern with the rural being presented on litigation to -- i have this concern about how coyou intentativeize build out on the -- you have to have a fee. that's where the fee debate comes from. how do you get a fee to help build out and maybe i have a simplistic view but the other question i have is to really, about the debate 10:25 how do

you encourage in this new venue and then i will end and if you could also answer, how does the individual consumer decide what speed they want versus being forced to buy a speed they will never use. like my mother-in-law. >> it is interesting, everybody cites their mother or mother-in-law in that example. there is nothing in here that regulates or establishes tariffs for consumer services. there is nothing in here that says that a company can't from multiple levels of services. so your mother-in-law gets e-mail only -- >> and will pay for that simple service versus whatever -- >> just so i can have a contrary debate can i have commissioner

riley address those before i run out of time. >> the order explicitly opens to post rate regulation. anyone can file a complaint with the commission or any federal court and that commission will have to adjudicate whether or not the rate is reasonable, and the fact that while on the surface you might allow for prices based on different services, it is also up to any court to citizen after the fact that whether or not the rate is reasonable. additionally you pointed out the effect this would have on deployment. we heard from companies that were responsible for the largest capital exspendtures, and companies that represent small market areas and they told us that the impact of this rate regulation and other title two regulations will impede them from deliver some of those advanced services. >> thank you very much.

>> thank you, gentleman yields back. we now recognize mr. lobesack. i getsdsuess i will start by saying i don't want to be to presumptuous about this but a lot of us have concerned about rural broadband. i have 24 counties, and although the chairman reminded me that his district is a lot charger than mine, i have 24 counties and a lot of rural broadband carriers, and a lot of small isps. but a lot of folks who need rural broadup and down for

education and health opportunities. for formers to access gps to plant and do it efficiently and make a living. this is a question for you mr. pie. >> we received a letter from 24 small broadband providers that each serves less than 1,000 kmerns customers. >> thank you, how many small providers are there in the country. we have a lot in iowa alone. >> i'm not sure what the number is -- >> about 800.

>> thank you. chairman wheeler, as i'm sure you're aware of the fcc authorization draft we had before, would make universal funds subject to the appropriations process. i have been here nine years, and things are pretty disysfunctional as we all know. in this current environment where congress seems incapable of passing a bill, tieing u.s. funding, that is so important for rural areas, for the appropriations process i think does risk a lot of instability down the road. do you support attaching usf funding to the appropriations process. >> let me see if i can answer that by talking about what we hear from the kind of carriers you were talking about. the small, rural carriers.

they say you're asking us to deploy capital. and we need to know that the capital from you is going to come behind it. and we need to know five or seven years of certainty that this money is going to be there. and that is the way that the universal service program has been run to provide that kind of certainty. learnly a serious concern if all of a sudden that certainty is impacted because the appropriations move like this or don't move. you know, and the crs or whatever it may be. for them to make the investments influence to provide service in high cost areas will be impaired. >> not to mention putting a cap

on it as well. i think this is just a really huge consider fortune so many of us. and i have had concerns in the past about how the usf is administered as well. >> i want to make sure that usf fund goes where it is supposed to go as well, and that those folks that can access that and provide that can have access to those funds. we we also know a lot of those folks are the ones paying into it in the first place and i heard that sometimes the funding doesn't come back them and they're being disproportionately put upon to contribute and they're not getting anything back. any of you care to respond to that. >> if i can pick up on that congressman, particularly for the smaller rate of return carriers we're putting into

effect this year a revision of the universal service program for them. we're going to deal with the hated -- the qrs the hated qrs. we're going to come up with a model that says here is what you can base your business decisions on. and we do need if i could pause for a commercial for a second, we do need those carriers to help us come together. the reason i knew there was 800 is because we hear multiple voices talking about what they need. and we have to come together, and if the industry could come together and say here is a common approach, that would be very helpful. i also need to correct the record on something that mr. pie said when he was make-- mr. pai staid

about small carriers. the representation for the small carriers said so the track records makes clear title two can provide a useful frame work and does not need to be an impediment to investment and ongoing operations. and the small rural wireless carriers in a statement also said a similar thing that they will not tap into this. we have to be careful that we don't haul out a handful of people and make great generalizations. >> thank you for indulging me. >> the chairman now reck nices for five minutes the chairman from new jersey. >> thank you very much commissioner pai, would you like to respond to that? >> thank you for the opportunity, i would.

i think it is significant to remember that the comments on title two, between the isp and the customer they had no idea because they never published the proposal. >> that's not correct. >> mr. chairman if i could respond. >> congressman. >> among the providers, these are folks that represent the public interest in their communities. one of the broadband providers was visited by the president himself. they themselves said please don't fall prey to what they call the facile argument. title 2 will not have an effect. and i think it is important to remember that with respect to what title two will have an effect, at the very --

regulation does have an effect. we heard from members of the american cable corporation. what is indisputable is they have thrived with light touch regulation. just yesterday we heard from a major broadband provider that we have benefitted from government stays out of internet. that was google's executive chairman, eric schmidt. >> thank you, commissioner pai in your statement you say i see no legal bath for the fcc for the two-sided market, and no objection to many of the chairman's proposal. we acknowledge that it could not be used for such a ban. while they resist saying it outright, neither could sitele

two they only deliver unjust or unreasonable consideration. and the courts have consistently charged different prices for different services. >> thank you for the question, congressman. it has been textbook law since title two was adopted and this goes back to the 1880s when they were regulating railroads. extending that toward the telecommunication age, it has been pointed out that you cannot ban pay to play regulation. >> given that how long do you think this is likely to be litigated in the courts. and i ask that because businesses need certainty for what the rules of the road will be long term. >> everyone can agree this will

be litigated for a long term. >> this goes first to the district court here first. >> depending on where it is filed, if there is multiple appeals it will be chosen be a lottery. >> do you think it will be presented to the u.s. supreme court? >> i think so. >> commissioner riley, your views? >> i agree whole heartedly on this three-plus year debate. commissioner rosenworcel? >> i agree. >> thank you, i'm 99.99% sure that there will be a legal -- >> so this is purer than ivory soap? >>ly go better than my

colleague. the big dogs have promised their going to -- i take them at their word. >> i do think that we need certainty going forward, and i'm deeply concerned regarding that. dr. clyburn, would you have supported reclassification under title 2 without forebearanence? >> i think one thing we did right was recognize the dynamics of the day. this is not your father or mother's forebearance. i'm very comfortable in seeing this is looking as a current

construct. >> i think you should have compared it to bogart and mccall, myself. thank you, the chairman yields back and the chair recognizes the gentleman from california. thank you, commissionerings, for your hard work on this. regarding the litigation issue, is there any decision you could make on net neutrality that would not involve significant litigation. >> i any you have hit the nail on the head, sir. >> okay, most of all, most or all stakeholders believe it is important to meet the big three in net neutrality no throttling, no paid for priority priortization.

>> there is only three in here. you have to tell the consumers what you're doing. the other thing that is establish general conduct that says you will not harm consumers, you will not harm innovators, you will not harm the functioning of the internet and the public interest. it is very interesting because people come in and say -- i don't know what that means. that is exactly the way the ftc operates and the way that the carriers have been saying let's take things away from the fcc and give it to the ftc because we like the case by case analysis better. so we're not adding rule making that says we know best, this is the way you're supposed to operate. what we are saying is there needs to be a judgement capability that says is that there harm?

and there needs to be the ability to do something about it. and you need to be able to weigh all of the interests. >> does the fcc have the power to regulate broadbadnd providers consumer advocacy regulators related to phone services? >> no. unrelated to their telecommunications, no. >> is that something that would be of value? >> obviously privacy is an important issue to all americans, and privacy in the digital age is an evolving thing. our statute that dates back to 1996 involves proprietary

physician and that's where the bulk of it comes from. >> is there enough engineers to help you do your job? >> i think we have terrific engineers, but it needs to be clear that our command is exploding. and if we had more engineers i believe we would be in a position to help facilitate more innovation getting to the market faster. >> do engineers tend to stay out of the politics of the commission or are they like other human beings and want to get into it once in awhile. >> that is a metaphysical question, i'm not sure i want to answer that one. >> you mentioned there should be

greater use of the five gigahertz band? >> yes, we benefit immensely from wifi. about 60% of us,000% of us you wifi at home. most of it is on the 2.4 gigahertz band. we have a spectrum at 5 gigahertz ban, only a portion of it is dedicated to unlicenses services. we have other uses in there and i think we should see if question free up more spectrum in there. >> what are the limitations of five gigahertz band. >> the higher you go you get

more capacity, but it doesn't travel as far. so five gigahertz is good in buildings and in households. having that functionality is very important. >> thank you mr. chairman? thank you, the gentleman yields back. the chair now recognizes the gentleman from texas for five minutes. >> i thank the chair, welcome to all of the commissioners. commissioner pai and commissioner riley were at the rollout of the new rules. they have some questions that you would have answered if you were at that rollout. they know they do not violate the fifth amendment by taking broadband providers property.

the commission stays it does not break the fifth amendment because they, quote, enhance the value of broadband networks by protecting innovation." if these rules enhance the value of these networks as the fcc's majority claims, why do broadband providers oppose the rules? >> thank you, i think part of the reason they oppose these rules is they have invested literally hundreds of billions or trillions of dollars since the inception of the internet on the reliance, starting in the clinton administration, that it would remain unfettered. that same congress agreed that access to the internet information service in section 238 of the act. they went to the capital markets, spent a lot of money

and took a lot of risk to build the best internet environment of the world. our internet is the envy of the world. and they have concern because under the leading case, pension benefit corporation versus connolly, there is a request of whether expectations have been disturbed by the title two regulations. >> so mr. riley your thoughts? >> i expect there will be an argument made and challenged, and the assumptions are lakely to put it to test. >> yes, sir, a question for mr. pai. i have a few questions my people want answered. it is about transparency. you wrote that your edits in the proceedings were rejected.

and yet another commissioner came back introduced those same edits, is that true or false, can you elaborate on what happened? >> thank you for the question. i put my own proposeal on the table a year ago. i don't need to go with my proposal working within your frame work here is what would get my vote. i was told no. i wanted to allow schools and libraries to use e-rate funds for cache servers. that was rejected as a red line. miraculously when the bill was adopted and the other side suggested it it was agreed to. one of the ones that was a red line was extending the line

because we put very complex proposals on the table and i wanted to know what public thought about it. i was told no, red line. low and behold, they have extended the comment deadlines twice. >> is that standard practice? >> it has not been historically. i can tell you based on my first year and a half at the commission while my office agreed or disagreed with parts of an order there was a spirit. and our products are can withstand the test of time. >> one follow up question about -- there is some parts out there that said it has been essential because it is so essential to our american life and the current situation is outdated and it must be changed. this is a change. should that change be y'all or

elected officials, for the american people, our voices, five elected commissioners i go home and take some heat good or bad and you go home to your familiars. any thoughts? >> that is precisely why when they wrote a decision last year, without knowing how this will turn out we should go to congress for guidance. you are the elected officials that should decide how the internet economy should proceed. on a matter this important, on the laws that constrain our authorities, we should turn to the congress. thank you, the gentleman yields back. i recognize the gentlelady from california. >> i would like to yield and switch our time. >> she yields to the gentle lady

from new york. >> thank you, and i would like to yield a few seconds to my ranking member on this issue. >> to commissioner pai, as you went through the litany of your ideas and you didn't get your way, welcome to the minority. >> thank you, let me just ask a few questions of our distinguishes commissioners. the first question is to commissioner -- chairman wheeler. chairman wheeler i'm concerned about multilegal broadcasting alerts and the fcc's urgency around this issue. in addition to 911 upgrades what is being done to be sure it reflects the growing ethnic and language diversity of our

nation. >> literally yesterday i was meeting with our, what is called our public safety and security body that is an advisory group and talking with them about the importance of updates eas and the recommendations they have put out in so far as making sure those updates are recommended to all of the parties. we have a system that has not been updated since the cold war. we have to fix it. >> i hope that we make that a priority. with the challenges that we're facing, 21st century challenges of climate change, of flooding, of unfortunately terrorist attacks, it is becoming more and more of a pressing need a current need. the next question has to do with

section 257 report. congress requires more market entry barriers every three years but your latest report to congress was due december 31st and it is still forth coming. how can it include more diversity in the media and telecom industries. >> thank you this has been an item of contention. my colleague commissioner clyburn when she was aking chair was moving this process forward. i think it is fair to say we ran into difficulties inside the commission, amongst the commissioners. she did an admirable and

excellent job that i am attempting to pick up and move forward on. these kind of issues are important to not only the future of how we build up telecommunications, but the future economic opportunities and structure in our country. >> very well, i appreciate that. two years ago i sent a letter to julius jankowski asking that the activation of chips in cell phones be reviewed. what progress has been made to ensure that my constituents have every piece of information at their disposal -- >> fm chips are a great idea and they're in an increasing number

of forms. it is a tiny device that becomes an issue. they also can drain battery power. but they're increasably showing up an consumers have the ability to purchase them and some specifically focus on them i think the broader question is whether or not the commission should be forcing wireless carriers to activate these chips, or weather they ought to be leaving that to consumer choice, i know that traffickers are running commercial saying write the fcc, write your congressperson, and make them do it. i think it is being resolved in the marketplace and we ought to monitor that and watch what happens. >> i appreciate that, i thank

you, and i thank you commissioners for your hard work and diligence. >> thank you your time has expired. the gentleman from illinois is now recognized for five minutes. >> thank you for being here and serving your country and spending our afternoon with us. commissioner, i have to tell you i asked about your suggestions to the commission that were ignored, and other folks made the suggestion and they were taken in. the joke was made earlier, and i chuckled too about welcome to the minority but i hope the commission does not become like congress. the goal was to not be overtly like that. i hope the commission doesn't follow us on that. you spent some time talking

about procedures surrounding the notice of proposed rule making. you stated that the standard and whether all interested parties should have anticipated the final role not that they could have anticipated the final rule. can you tell me what it was compared to what was eventually adopted. >> thank you for the kind words about the bipartisan efforts i have made. i think the problem is substantial. i think the fcc teed up in may of 2014 and it was very different from the one it ultimately adopted. it never mentioned such things like the extent of forebearnece. i think once the fcc teed up

this plan and voted on it on february 26th a lot of the things in there unfortunately, there is no record sufficient to support them. there is no record, especially on a agree graphic basis, to grant forebearance. and i think there will be substantial legal problems with this. >> thank you, chairman wheeler you said if asked to regulate rates that the commission would make it clear that the commission will not regulation retail rates on broadband. would you agree that regulating it is consistent -- >> i said repeatedly that we're not trying to regulate rates.

and if congress wants to do something in that regard -- >> you're not interested but what about the next fcc commissioner. do you believe that under title two they have the authority to regulate rates now? i respect that you don't want to but you will create something that will be passed down. sn. >> as i said in my earliest response, i hope without prejudging the issue that we can build a record that will make it difficult for that to happen. congress clear lay has the authority -- >> you can understand our concern, with respect when you say i have no inattention of doing it you can understand the concern of congress where you implement a rule and say i don't have any inattention of regulating rates, but i'm not going to prevent -- >> one of the things we did was pattern this after section 332

in the regulation of mobile voice. and for 22 years, this exact same authority has rested at the commission for mobile voice service and never been used. >> so if legislation that said not with standing any provision of law, they may not regulate the rates charged for internet broadband access service, that would be consistent with that view? >> chairman we heard that it will have no impact on investment because mobile voice services is linked to title two. >> i do not agree. it is important to remember that the reason it didn't occur is because the fcc from inception termed the shois marketplace to

there was no reason for rate regulation. now they say the broadband market is not competitive. so it opens a door not regular laced for mobile vice. with respect to mobile investment, one of the reasons we have seen such huge investments was the inception of the smart phone and the huge increase in mobile data traffic as a result. carriers have to spend to keep up for infrastructure and spectrum. mobile data traffic has never been classified as a title 2 service. >> thank you all for your service. i yield back. >> thank you, we now turn to the gentle lady from california. >> thank you mr. chairman. thank the commissioners for being here. a question for commissioner rosenworcel.

i believe we need a national spectrum plan that considers licenses and unlicensed spectrum. you have done a lot in this space, i know, but can you share with us briefly some of your idea to -- >> let's see the fuel for our wireless lev lugs is spectrum. if we want a modern spem trum economy, we need a more consistent pipeline. we need more air ways for commercial mobile use we knock on the door and we beg and overtime we get some scraps and congress will direct those federal authorities to clear out of that spectrum, relocate, and

then the fcc auctions off those rail ways. it is slow, clunky, not reliable, and not a pipeline that our modern wireless economy needs. that's why it is very important for federal spem trum authorities so that when we try to secure more air waves they see benefits and not just loss. that could include changes in their budgets benefits through the appropriations process, to the ability to secure what sequestration may have taken away. chairman wieber, i have a question for you, i remain concerned about the sting ray

surveillance devices newsed by a number of local law enforcement agencies. there doesn't seem to be any federal oversight. and the public should have more access to the information about the device, the surveillance capabilities and who has ak esz-- access to the data. and how does it not collect data on innocent americans. you have created a task force. i would like to know the stattest of the task force, what has come out of it, and what you're doing to help the lack of oversight. >> the task force did look into

the situation. what we found was as follows. that our jurisdiction and our authority is to certify the electronics and the rf components of such devices for interference questions. in that if the application was being made in conjunction with law enforcement, then we would agree. this is for the technology, this is not for who buys it. that we would approve it. and that from that point on, it's usage was a matter of law enforcement, not a matter of the whether or not a piece of hardware interfered with other rf devices.

>> so you're saying this is not not -- i'm concerned about the device being sold on the internet to non-law enforcement. so this is something that would fall in with federal law enforcement? >> on the broad issues it will follow up. i think that we would have enforcement services if in fact it were being told -- >> okay, thank you. >> i just want to bring up another issue here. more consumers particularly more than millennials are clearly seeing the market react. hbo and apple streaming agreement, cbs is offering monthly online subscriptions, on

and on. i think this is the future, and no doubt it is a complex issue. however soon the consumer will basically paying for bandwithand we should empower consumers to pay for programs they want to watch. i think this is something that we should explore moving forward. >> we recognize the gentleman from florida. >> thank you, i want to thank the commission for their patience today. mr. chairman, there was an enforcement action in the tampa bay area it seems like he had a powerful jammer in his suv. powerful enough to jam local law enforcement radios and calls to

911. he had been doing this for the last -- for over two years. when a local cell phone company reported interference, the field agents in the tampa office quickly tracked him down and ended the significant threat to the safety of the folks in the tampa bay area. it's my understanding your plan to close the office in my area as a former chairman of homeland security, i have a few questions. how many offices do you plan to close? >> the jobs lost, saved from the tampa bay area, moved to the washington dc area, yes or no? >> no. >> okay, are you closing the field offices and laying off staff to support the enforcement bureaus you work under the net neutrality order?

>> no we're doing it to increase productivity. we're finding it costs too many people doing too few things in a specific area not that there are issues there, but that there is greater productivity if we follow the kind of model that the faa is doing when you have strike forces. we would leave in place, in tampa, for instance, necessary equipment, and would bring people in out of the miami office to deal with the kind of situations that we're talking about and that that is a more cost efficient way of accomplishing that. >> according to the budget requests on page 50, they will preserve the integrity by taking

action on 99% of complaints of interference to public safety communications within one day. will you commit to ensuring this metric has been met historically, for instance, the performance report that the commission has issued over the years, years. will you provide the committee orderly reports detailing the enforcement bureau success in meeting that metric. >> i know you talk about it, you can elaborate a little more what would you like to tell the deputies that may be in danger because of this very important issue, of public safety,

inevitable of losing a field office. florida is a big state and i know other members probably have questions with regard to the offices being closed nationwide. >> i think the reality that we face is that we have a flat or diminishing budget. we have unfunded mandates proposed by the congress and weapon have to say how can we increase efficiency. do i want to close these offices? i don't want to -- i don't want other folks who are representing areas that will lose offices and hear their complaints. i have a fixed amount of dollars to work with. and so the question becomes how do you become efficient and that's what we're trying to do.

>> thank you, commissioner riley, how does the united states have any credibility telling countries like china or iran not to control network practices within their borders if we're taking large steps in that direction. >> we are setting our stage by passage on this item. it matches up with my conversations. i went to spant recently and i was in south korea for the itu. they're interested in engaging on issues of broadband. they would like to get as much involvement as they can. those regimes you speak of have greater government control on the practices of internet in their nations so it is a by fur fur -- bifurcated message.

now we're saying we're willing to do some things to regulate broad band, but you should not do it over there. i think it is a terrible message that we're sending. >> i agree. i brould associate myself with the state department's views five years ago when we said "we are concerned that in some countries, for purposesover bringing unearthquake social, political, or cultural information. i think this is a bipartisan in which the u.s. has stuck together, and i hope that will continue into the future. >>. >> thank you can we submit for the record full quote that was -- >> it is really taken out of context. >> it is not.

>> we now recognize the gentleman from ohio. >> from the great state of ohio. >> oh stop it. >> chairman wheeler, i want to tell you how honored i am that you have chosen to join with our chairman in paying tribute to ohio state today. commissioner rosenworcel. i want to associate myself with something you said. you said we rarely go anywhere without our mobile devices on us. i could not agree with you more. i was in information technology for 30 years long before there was anything that we know of as internet. and that is because we had

regulationed internet and information services that have allowed the innovators to allow. i agree with you. chairman wheeler, we have requested this committee's a number of document that's have been denied under the claim of process -- part of the dlib rative process and makes rengs recommendations or expresses opinions on internet matters, and the filings are required to disclose clungss between the fcc and the executive branch if those discussions are of substantial significance and

clearly intended to affect the ultimate decision. i'm trying to figure out how these two dimpltfferent concepts apply here and withholding certain communications between the white house and the fcc, you have asserted the dlib rative process prif -- deliberative process. something questions emerge. are the concerns, or the contents of those meetings im immoralized in any documents at the commission. how could it have been a direct part of the process, but not be of substantial significance in that proceedings. those are questions rolling around in my mind. i'll get to a question for you. i know you have indicatesd you

received no secret instructions from the white house. but of course secret instructions is not the standard for determining when ex partes were available. in the time you had in advance, is it your opinion that only that that was the only meeting that addressed the merits of the commission for an open internet proceeding that occurred last november? >> yes, sir -- >> did you say yes? >> yes. and the ten meetings just to be clear, were not meetings that were necessarily on open internet. we had trade national security cyber -- >> but in the meetings that came on the fcc's action on the open

internet, you said it was not clearly intended to affect the ultimate decision which would require the disclosure of that information. >> there is two parts there. >> no, you correctly identified -- >> is it yes or no. >> i did not get instructions in those meetings. >> i'm not talking about that, i said do they qualify under ex parte, or do they qualify for both. >> and they're -- >> mr. wheeler, this is my time, how do they qualify under both? if they are discussions with the white house, my goodness, that is the highest office in our land. i see that the american taxpayer doesn't see that as significant

and substantial. how can they not be significant and substantial and you deny them under a deliberate process -- >> there are multiple were not instructions given to me. i've been on the record on that and been clear. second is -- >> that's not the basic -- that's not the determination. >> i'm about to -- the determination also is that specifically interactions with congress and the white house are excluded from ex parte and have been since 1991. but i'm going beyond that and saying that is a non-ex parted conversation. >> under what basis? >> i got no instructions -- >> under what basis? you can't just make that up. the law says what is required to be revealed and what is not to be revealed. and a deliberative process

privilege applies when you can show a direct part of the deliberative process or that it makes recommendations or expresses opinion in legal or policy matters rather than substantial significance and clearly intended to affect the ultimate decision. >> i'm quoting the law. >> well i'm disagreeing with you, mr. chairman. and i think it's irresponsible that you're withholding information that rightfully should be openly disclosed to this committee and to the american people. i've exhausted my time. >> the chair will recognize the gentleman from new york mr. collins. >> thank you, mr. chairman. before i get to my questions for commissioners o'rielly and pai one follow-up to mr. johnson's questions, chairman wheeler there were ten meetings and we do understand there was on the ex parte side disclosure on one of those ten meetings. it's my understanding that on the other nine meetings there was nothing of significance discussed relative to the fcc where under the rules of ex

parte you should have or would be required to otherwise disclose those. is it true there was nothing disclosed on nine of the ten meetings? >> no there's -- the test is -- >> was there anything -- sir, i'm asking the questions. was there anything disclosed on the other nine meet sngz that's a yes or a no. >> i had no instructions -- >> yes or no. >> no. i had no instructions. >> well, i guess i am befuddled that in nine of the ten meetings in the white house there was nothing of any consequence discussed with the fcc. i'll take you at your word. one thing we were clear about is the importance of certainty. and mr. cheeler, chairman wheeler more than anybody stressed the importance to the providers in the internet space of certainty, certainty, certainty. and i can't agree more.

with my life in the private sector. certainty drives investment and returns. and with certainty you invest in innovation. and i would say it's pretty obvious today. the way things have worked is a pretty light touch. the investments have been billions. as commissioner pai said, maybe trillions of dollars. we lead the world today. here's my concern. we've also heard unanimous agreement by the commissioners. litigation is coming and likely to take three years. chairman wheeler said guaranteed litigation coming for three years. if that's not the definition of uncertainty, i don't know what is. for the next three years the folks looking to invest and innovate in this world have to live under the ultimate uncertainty of which court is going to rule how and when does it move and what do you do? so to me there's a real issue here, a very genuine issue of inconsistency with the chairman

stressing the importance of certainty and then saying one thing is certain, we're going to court, which guarantees uncertainty. i guess commissioner pai i'd like to say again, to me lack of certainty is a wet blanket on investment investment. lack of certainty is a wet blanket on innovation. and my worry is with less innovation and less investment we will someday wake up and not be the leaders in the world relative to what we think and know is probably one of the most important aspects of where we're headed. could you briefly comment on that and perhaps take a minute and i'd like mr. o'rielly to fill in the rest of the time. >> i couldn't agree with you more thaun certainty is the bane not only of the private sector but the public sector who won't get the benefit of the private sector risk. i'll give you two orders of uncertainty this order generates. with respect to the internet conduct standard which lays out seven vaguely worded non-exhaustive factors under which the fcc is going to determine what is allowed and

what isn't allowed. the fcc after the vote conceded with the we oent go where thikz go next." the fcc will sit there as the referee and be able to throw the flag. the electronic frontier foundation targeted this particular rule and said the problem with a rule this vague is that neither isps nor internet users can know in advance what kind of practices will run afoul of the rule. second example, the enforcement bureau vezry opinion process. nobody knows exactly how it's going to work. commissioners won't have the ability to have input into that. and when you pair the enforcement bureau and advisory opinion process with this internet conduct standard essentially the entrepreneurial spirit of america is going to be funneled through this regulatory bottleneck and nobody's going to know in advance until they get permission from washington what is allowed and what isn't. >> i couldn't agree more that the only thing certain is uncertainty for the next three years. commissioner o'reilly in. >> i couldn't agree with my colleague any more. i think he's hit it right on the head. i would say i was in st. louis a couple weeks ago month ago, and

talked to isps, talked about what could happen under this item, what would be for their business. and these are the small guys. we talk about 800 other providers. these r8 00 wireless isps trying to serve in the most rural parts of america and they're stringing together networks under unlicensed bans and they're asking for more spectrum. and i'm like what does this mean for me? more paperwork, more compliance. means you don't know what you can do for your business for a number of years. they were frustrated beyond belief. >> i share your concerns and i think america will too. and we'll have to see where that heads. mr. chairman, my time's up, and i yield back. >> thanks gentleman from new york. and our witnesses. and i've heard some of the same things from small internet providers in my district. they're feeling like they're going to be overwhelmed by this. so i'm meeting with some of them as well. i know mr. scalise is on his way here, the whip of the house. so we will try to accommodate his questioning. >> mr. chairman, i'm going to have to leave. i have to catch a flight. and i don't know if that has an

effect on -- if i leave can you keep the hearing open? >> we can seek counsel on that. but obviously we should try to accommodate the third ranking member of the -- >> i know. but we started at 11:00. so i mean, he could -- he's had some time to get here. i'm a patient person. but i don't want to miss my flight. >> what time's your flight? >> i have to go out to dulles. >> what -- >> it doesn't leave from the rayburn horseshoe, unfortunately. >> so while he comes in the door here, we are now going to let him get settled. but as he is getting settled, first of all, if i could ask all of the witnesses to -- there will be some follow-up questions. some of them you've all taken down down. because of the nature of our work, we'd like to have prompt

responses to the questions. i know you've probably had questions from other committees as well. get that. but the extent to which you can respond promptly that would be helpful. thank you, anna. and we would like your feedback on the draft legislation that we put out there. all of your feedback would be most helpful. it's not a rush job. we're trying to get this right. and we think it's very important. so with that i would now recognize the gentleman from louisiana. the whip of the united states house of representatives. allowing him to catch his breath fully. mr. scalise. >> thank you, mr. chairman. and i tested my 40 speed getting here. but i appreciate the commissioners being here. coming to testify about their commission and also about this net neutrality proposal that i know i have strong concerns about and a lot of my other colleagues have expressed real strong concerns about as well. i guess when you get back to the

basic question of what's worked so well with the internet and the technology community as a whole, somebody who graduated in computer science who's worked in the technology industry, i've always felt that the reason that the industry's been so successful is because the federal government hadn't figured out a way to regulate it to slow it down and yet here you come with an answer to a problem that doesn't exist. a heavy-handed role of government. and the fcc's traditional role has not been to have a heavy hand. in this when you look at the proposal that's come out my goodness, over 300 pages of regulations. this is just the first round before the proposal's even been put into effect. i guess, you know, if anybody's looking for a free and open internet i'm sure they'd look to over 300 pages of regulations from the federal government to start their process. it's not broken. why is the federal government here to fix something that's been working incredibly well? especially when you look at the role of federal regulations over the years and just what they've

done to harm our economy? i do want to ask you, commissioner pai because you've made some comments earlier about the potential taxes and fees that can come with this title 2 classification. and when you look at section 202 of the law it clearly gives that ability to get involved, for the fcc to get involved in regulating costs for the internet. so if you could share with me just what kind of impact this can have on both fees being implemented, higher prices that consumers will ultimately pay from this new classification. >> thank you for the question, congressman. i think a multitude of fees and taxes are going to be levied on broadband in a way that is ultimately going to redound to the consumers' detriment. just to give one example now that broadband has been reclassified as a telecommunications service that order explicitly opens the doors to billions of taxes and fees being assessed through the universal service fund. so now in addition to the line item you s