A federal appeals court has temporarily paused the Federal Communications Commission’s “open internet” order set to take effect soon, staying rules that could pose new regulatory and compliance burdens for electric cooperatives providing broadband service.

The FCC order could deter cooperative broadband deployment and hamper efforts to close the digital divide, NRECA CEO Jim Matheson said. The association will continue to voice its concerns with the FCC, including encouraging permanent, targeted exemptions to certain reporting requirements for small providers, and will monitor ongoing legal challenges against the order.

“All consumers should have fast, open and fair access to internet services,” Matheson said.

“The burdensome new reporting requirements will force small providers to needlessly divert resources and investment away from the primary objective of delivering high-speed internet to rural families and businesses,” he said.

The rules were set to take effect July 22, but that deadline has now been pushed to early August after the U.S. Court of Appeals for the 6th Circuit temporarily paused the rules amid lawsuits from several internet providers.

NRECA recently released a fact sheet for NRECA Broadband participants on key takeaways in the FCC order.

The order reinstates “net neutrality” rules from 2015 that bar broadband service providers from blocking access to lawful internet traffic or slowing down the user’s connection to that content, a practice known as “throttling.”

It also expanded the FCC’s regulatory oversight of broadband services and adopted new rules and requirements for providers offering these services. The order reclassifies broadband from a lightly regulated information service under Title I of the Communications Act to a more stringently regulated telecommunications service under Title II of the law. As a result, co-ops may be burdened by additional privacy, cybersecurity and public safety regulations in the future.

The FCC rejected NRECA’s request to permanently exempt small entities with fewer than 100,000 subscribers from various reporting requirements under its order. The commission adopted NRECA’s proposed “small entity” threshold but only to temporarily provide exemptions in two specific instances related to performance disclosures.

NRECA will continue to advocate for those temporary exemptions to be made permanent. A lack of targeted exemptions for electric co-ops and other small entities "will complicate efforts to deploy and maintain broadband in rural communities," Matheson said shortly after the FCC voted to adopt its order in April.

A poll of NRECA members providing broadband service found that most don’t have even one full-time equivalent employee assigned to manage regulatory compliance issues. Adding new regulatory burdens to those co-ops could hamper their efforts to quickly restore service during outages as they work to extend service into unserved rural areas.

As not-for-profit entities owned by the members they serve, co-ops are already dedicated to providing utility services—including broadband internet—on a universal basis, NRECA said in comments on the proposed rules. NRECA member co-ops providing broadband have no need or incentive to engage in blocking, throttling or paid prioritization of that service, the comments stated.

“The FCC’s open internet order effectively places a regulatory umbrella of legacy regulation over broadband co-ops that can severely hamper their ability to deliver broadband to rural America,” NRECA Regulatory Affairs Director Greg Orlando said.

As lawsuits against the order proceed, NRECA is still seeking clarity on some aspects of the order.

The FCC declined to preempt state regulations of broadband but will address them on a case-by-case basis. NRECA had asked the FCC for more details, saying the provision could lead to additional regulation at the state level.