Federal Shutdown Has Likely Affected Many Telecoms, Carr's Agenda

Congress was moving toward an eventual end to the shutdown Monday after the Senate voted 60-40 Sunday night to invoke cloture on a motion to proceed on Republicans’ House-passed continuing resolution to restore federal funding through Nov. 21 (HR-5371), which will now serve as a vehicle for advancing a compromise package to reopen the government. Senate Majority Leader John Thune, R-S.D., secured support from eight Democrats on Sunday night by promising a separate vote by mid-December on extending Affordable Care Act subsidies. The revised HR-5371 would extend most appropriations through Jan. 30, reverse the Trump administration's layoffs of some federal workers during the shutdown and include FY 2026 funding for the Agriculture Department. The measure allocates $108.5 million for USDA rural broadband programs, including more than $50.7 million for the ReConnect program (see 2511100037).

The timing of Senate and House votes on an amended HR-5371 remained unclear Monday afternoon. Thune told reporters it “would be ideal … for [the Senate] to be able to finish it today and send it to the House” but later indicated that the upper chamber was “in a holding pattern.” House Speaker Mike Johnson, R-La., told reporters he intends to call the chamber back into session once the Senate passes the amended HR-5371. But Senate Homeland Security Committee Chairman Rand Paul, R-Ky., was opposing a unanimous consent to speed the process of clearing HR-5371 unless the chamber’s leaders agreed to hold a vote on an amendment that would remove language that bans intoxicating hemp products.

The shutdown has been “problematic for everyone,” said New Street’s Blair Levin, a former FCC chief of staff. Doing business with a partially closed FCC is comparable to driving a 30-year-old car “with lots of issues cross-country rather than a new one.” With the government closed, everything takes longer and “is less comfortable, and one never knows when there will be a delay,” Levin told us. But in the long run, there probably won’t be a material impact on any company's financials, he added. “None of the auction activity is delayed, as the auction team is funded differently and therefore is not subject to the shutdown.”

Many FCC systems have been down, “which freezes … a lot of economic activity,” emailed Cooley’s Robert McDowell. Some requests, including urgent license grants like those for special temporary authority for space station launches, “can get through, but only in extraordinary circumstances.” FCC Chairman Brendan Carr “and his skeleton team” have been “as responsive as possible, but it’s clear that this situation is hard on them as well,” McDowell said. While the shutdown delayed implementation of Carr’s agenda, it also stopped “cold in its tracks any routine business.”

FCC Filings 'Avalanche'

Fletcher Heald’s Francisco Montero said he expects “an avalanche” of Licensing and Management System (LMS) filings once the government reopens, possibly enough to crash the FCC system. Lawyers at the firm will be watching what the commission will do on deadlines that fell during the shutdown, he said.

“Will they want these filings within days or weeks after the government reopens?” Montero asked. “In the interim, we've been sending emails to the staff, in lieu of LMS uploads, even though they may not be read. … This way we have a written record of having attempted to notify the client at a deadline.” He added that lawyers have also been “debating ambiguities” like whether a grant can become final during the shutdown, if no petitions for reconsideration are filed, and whether a broadcaster can go back on the air with a special temporary authority if it's still pending.

“The biggest issue” has been “the inability to get transactions reviewed and closed,” said a lawyer with telecom industry clients. Not only is the universal licensing system down, preventing the filing of transfer applications, there’s likely no staff to process them, the lawyer said.

The closure “negatively impacted a wider swath of businesses than many may realize,” said a lawyer with mostly wireless clients. “Companies that are not traditionally thought of as being regulated by the FCC, such as medical device companies and others, cannot get their equipment certified and move forward with the importation and marketing of these new products.”

Another regulatory lawyer said he has been increasingly hearing concern from clients about their inability “to do otherwise routine things that are nevertheless material to their businesses.” That includes equipment authorization for new devices “that take weeks to ship into the country” and new or modified licenses for additional or upgraded facilities, he said. “Some of that would happen regardless, given the length of the shutdown and impact on staffing, but turning off the databases was a choice that makes some of this even more difficult for clients from an operational perspective.”

In a government relations update for members Friday, NATE said the shutdown has slowed work at the FCC, the National Institute of Standards and Technology and other agencies. That has caused “delays in device certifications, spectrum licensing, AI standards development and even the processing of comments,” it said. “While major government contracts for telecom vendors remain largely intact, a prolonged shutdown could create bigger ripple effects in cybersecurity, standards and infrastructure build-outs.”

Working with the FCC has been more difficult in general, emailed Andrew Schwartzman, senior counselor at the Benton Institute for Broadband & Society. “The inability to have the opportunity to interact with staff and the seeming lack of transparency makes it hard to participate in proceedings. The restriction on staff for Commissioners [Olivia] Trusty and [Anna] Gomez” was “especially challenging.”

Broadcaster Concerns

Other broadcast industry attorneys also told us they're concerned about the FCC’s filing databases handling the first business day after the shutdown ends, when all the filings with delayed deadlines will be due. During the shutdown, TV and radio stations all over the U.S. have been unable to access the LMS and use the online public files in which they're required to display numerous FCC and political ad documents.

“The concern is that you've got a million public file documents, especially from stations and states that have had elections” during the shutdown, said Wilkinson Barker broadcast attorney David Oxenford. Stations in California, New York, Virginia and New Jersey will need to upload their political ad sales, and nearly every broadcaster in the U.S. will need to upload their FCC-required quarterly issues/programs lists. Responses to equal employment opportunity audits are also due from 300 stations, as well as EEO reports from stations in several states.

That’s all on top of other applications that have likely stacked up in the industry while the system has been down, Oxenford said. “I know that there are technical changes and assignments and transfers that have been done but not yet filed because you can't get into the system.”

The LMS system has experienced slowdowns and crashes in the past on big filing days, and the backlog caused by the longest shutdown in U.S. history is expected to be worse, attorneys told us. “Everybody that I've talked to that knows the system expresses concern that it's gonna be slow, very slow,” said Oxenford. In a blog post in October, he suggested that the agency could eventually change the plan to have everything come due on the same day after the shutdown. “Many questions are being raised as to whether the filing deadline on the day after the day the FCC reopens for all documents due during the shutdown is realistic,” he wrote. The FCC didn’t respond to questions about post-shutdown preparations or deadlines.