FCC Rule Slams Multifamily Commercial Partnerships

February 18, 2022 |

Updated April 19, 2022

2 minutes

The FCC voted to adopt new rules regulating certain commercial practices between property owners and broadband service providers. Here's what you need to know.

Less than one month after circulating a proposal focused on driving broadband competition in multiple tenant environments (MTEs), the Federal Communications Commission (FCC) has voted unanimously to adopt new rules regulating certain commercial practices between property owners and broadband service providers (broadband providers). Under the new rules, broadband providers are:

  • Blocked from entering into exclusive and graduated revenue sharing agreements;
  • Required to disclose the presence of an exclusive marketing arrangement in material distributed to residents or prospective residents; and
  • Reminded that sale-and-leaseback arrangements are prohibited under federal code.

In anticipation of the rules’ effective dates, the National Apartment Association (NAA) will publish forthcoming member guidance to help the rental housing industry understand its responsibilities.

An analysis of the new rules paints a disheartening picture. Notably, the FCC rejected critical data illustrating the abundance of broadband service options available to renters. Furthermore, the FCC failed to acknowledge that the newly targeted commercial activities in the ruling actually support and increase the deployment of high-speed, high-quality affordable broadband in apartment communities nationwide.

NAA supports efforts to accelerate broadband deployment and modernization in apartment communities and believes that this must be achieved in ways that underscore the success of current partnership-based models.

While the FCC’s actions are disappointing, NAA continues its advocacy efforts to educate policymakers on the operational consequences of this policy approach and support the industry with compliance resources.

For more information on broadband and telecommunications issues, please contact Sam Gilboard, NAA’s Senior Manager of Public Policy.