According to this morning’s Federal Register, Section 73.3612 – the rule requiring broadcasters to file annual employment reports on Form 395-B – is now in effect.  We’d like to be able to tell you what that means, but we don’t know.

Section 73.3612 was last amended back in 2004.  It requires each AM, FM, TV, Class A TV and International Broadcast station with five or more full-time employees to file Form 395-B by September 30 every year.  (Form 395-B calls for disclosure of the racial, ethnic and gender breakdown of the reporting station’s full-time and part-time staff, according to job category.)  Even though that rule has technically been on the books for nearly nine years already, apparently, it has not previously gone into effect.  According to an “effective date note” that has been appended to the rule since 2004, “[t]his section contains information collection and recordkeeping requirements and will not become effective until approval has been given by the Office of Management and Budget.”  OMB approval of Form 395-B was granted in due course back in 2004, and it has been renewed periodically since then, though a condition was later attached.  In any event, before the 2004 form’s due date, the FCC suspended the filing requirement until further notice.

That explains why you probably haven’t given much thought to annual employment reports lately.

Why has the rule been on ice for nearly nine years?  It’s complicated.

In 2003 the Commission tried again, more successfully.  Following along in 2004 rules was a reinstitution of Form 395-B, which contemplated further revisions to be based upon a revised form (Form EEO-1 Employer Information Report) which was anticipated from the Equal Employment Opportunity Commission.  But in 2002, Congress had passed the Confidential Information Protection and Statistical Efficiency Act of 2002 (CIPSEA), which imposes some confidentiality limits on an agency’s use of information collected for statistical purposes.  Concerns about confidentiality of Form 395-B data had been expressed, strongly, by broadcasters for several years before then.

Although seemingly disposed not to treat Form 395-B data as confidential, the FCC wasn’t clear on whether CIPSEA might apply to those data, so it put that question out for comment in 2004.  In the meantime, it held off on making any of the new rules effective until further notice.

Despite the fact that Form 395-B was not in use, the Commission revised it again in 2008, as it had been directed by OMB, to conform to changes in the corresponding EEO Form EEO-1.  At that point the FCC asked again for comments on the revised form.  In response, broadcasters again raised confidentiality concerns, but said little about the actual revisions to the form.  Since the form had to be approved by the Office of Management and Budget (thanks to the Paperwork Reduction Act), the matter was also thrashed out before OMB. 

OMB approved the form in 2008, with the following caveat:

OMB approves this collection but FCC should not initiate using or collecting information with Form 395-A or Form 395-B until FCC decides whether the data collected from each form will be held confidential or not on an individual basis. Following such a decision, the Commission should consult with OMB prior to initiating usage of these forms to determine whether the decision regarding confidentiality results in a substantive change to the collections warranting formal review by OMB of the proposed revisions. If the Commission does not consult with OMB prior to initiating usage of these forms, OMB may request under 5 CFR 1320.10(f) for the Commission to submit these collections for formal review prior to their expiration date.

When that 2008 OMB approval expired in 2011, OMB agreed to extend its approval for another three years, but subject to the same condition.

Since the FCC has not, since first posing the question in 2004, ever resolved the confidentiality question, Form 395-B has sat on the shelf, gathering dust.

Until now . . . maybe.  This morning’s Federal Register notice clearly announces the effectiveness of Section 73.3612, which in turn means that broadcasters will, at least theoretically, be required to file Form 395-B this coming September. 

But a couple of factors suggest that that might not really be the case.

First, today’s notice cites OMB approval issued in 2004.  While it’s true that OMB did approve the form in 2004, that approval expired years ago. 

Second and more importantly, the current OMB approval was issued in 2011, and is subject to the condition noted above.  But the FCC, also as noted above, has not to date resolved the pesky confidentiality question, so it’s far from clear that the Commission could claim that Form 395-B can properly be used just yet.

To try to get to the bottom of this conundrum, we called an FCC official who would ordinarily be expected to know about things like this.  He indicated that he had not heard anything about any impending effectiveness of Form 395-B or other related developments and seemed surprised when told about the Federal Register notice.  His surprise arose in particular from the fact that the issue of the confidentiality of the Form 395-B data has yet to be resolved and his acute awareness of the condition on use of the form.

So there you have it.  The Federal Register is telling us one thing while the totality of the public record seems to be telling us another.  Stay tuned for further developments.

Attention, all DTV broadcasters! Your Form 317 is due at the FCC by
December 3. You get an extra couple of days this year (since the normal December 1 due date falls on a Saturday), but those two days should give you plenty of time to complete and file the form. 

Having trouble recalling just what Form 317 is all about?  No problem.  Form 317 is the “Digital Ancillary/Supplementary Services” Report on which you have to report whether, between October 1, 2011 – September 30, 2012, your DTV station provided any ancillary or supplementary services for a fee and, if so, how much revenue the station received. If you did provide any such services, then you’ve got to fork over five percent of the gross revenues you got from them (the payment to be accompanied by a completed Form 159, thank you very much.)

“Ancillary or supplementary services” include any services that are provided using the portion of a facility’s spectrum that is not needed for its required one free broadcast signal.  Multiple video streams that are received free by the public are not considered to be ancillary or supplementary services.

The filing requirement applies to all digital broadcasters of television programming, including TV translators, LPTV and Class A television stations, whether operating pursuant to a license, program test authority, or Special Temporary Authority. And it applies whether or not the broadcaster in fact offered any ancillary/supplementary services for a fee. Obviously, if you offered no such services, the report will be short and you won’t have to do any calculations or pay any money to the Commission – but, if you have a facility that is operating digitally to broadcast television programming, the FCC wants a Form 317 report from you, and it wants that report by December 3.

In a public notice reminding one and all of the requirement, the Commission darkly observes that failure to file “may result in appropriate sanctions”. Consider yourself warned.

As with most forms these days, the Form 317 must be filed electronically through CDBS. Also, keep in mind for planning purposes that only one station goes on each report. Thus, if you are a licensee with a number of digital translators, you’ll probably need to allow more time for filing.

If you would like any help in navigating the electronic filing or have any questions about the form and what needs to be included, please let us know. While we won’t help with any payments that may be due, we can assist you in the filing process.

No problem, though. In a notice published in the Federal Register on November 28 – a comfortable three days before the December 1 filing deadline – the FCC has announced that OMB signed off on the revised language of Section 73.624(g) on November 17. And with the November 28 Register notice, the rule has become effective as of November 28, 2011.

Hey, all you DTV broadcasters! Before you start to carve the turkey and settle in for a long Thanksgiving weekend of football later this week, don’t forget to make a note in your calendar that Form 317 is due at the FCC by December 1. Form 317 is the “Digital Ancillary/Supplementary Services” Report on which you have to report whether, between October 1, 2101 – September 30, 2011, your DTV station provided any ancillary or supplementary services for a fee and, if so, how much revenue the station received. If you did provide any such services, then you’ve got to fork over five percent of the gross revenues you got from them (the payment to be accompanied by a completed Form 159, thank you very much.)

“Ancillary or supplementary services” include any services that are provided using the portion of a facility’s spectrum that is not needed for its required one free broadcast signal.  Multiple video streams that are received free by the public are not considered to be ancillary or supplementary services.

This year, we truly mean all digital broadcasters of television programming, including TV translators, LPTV and Class A television stations, whether operating pursuant to a license, program test authority, or Special Temporary Authority.

Not any more. The report is now required of all digital TV broadcasters.

Note that even digital TV stations that offered no such services must still file Form 317 report by December 1. Obviously, if you offered no such services, the report will be short and you won’t have to do any calculations or pay any money to the Commission – but, if you have a facility that is operating digitally to broadcast television programming, the FCC wants a Form 317 report from you.

As with most forms these days, the Form 317 must be filed electronically through CDBS. Also, keep in mind for planning purposes that only one station goes on each report. Thus, if you are a licensee with a number of digital translators, you’ll probably need to allow more time for filing.

If you would like any help in navigating the electronic filing or have any questions about the form and what needs to be included, please let us know. While we won’t help with any payments that may be due, we can assist you in the filing process.

In late October, amid much congratulatory buzz, the American Association of Advertising Agencies (which sometimes refers to itself as the 4A’s) adopted a new “best practices” policy recommending that ad agencies adopt “non-discrimination vendor policies and procedures”. In the eyes of some – Commissioners Copps and McDowell, for two prominent examples – this move was just what the Commission had in mind back in 2007-2008, when it first announced that broadcasters would have to certify (in their renewal applications) that they (that would be the broadcasters) don’t discriminate on the basis of race or ethnicity in their advertising contracts.  The Commission’s action was designed to put a stop to, or at least curb, so-called “No Urban/No Spanish” dictates in ad time buys.

The Commission’s policy is not without its conceptual shortcomings. Not the least of those shortcomings is the fact that, since it’s applicable only to broadcasters, the FCC’s policy leaves a gaping hole in protection against the supposed discriminatory practices to which it is directed. After all, broadcasters are in the business of selling time for others’ commercial messages; broadcasters are thus generally not the ones making the decisions as to which station’s time will be purchased. Moreover, stations are often at least one step removed from those decisions, since advertisers frequently rely on ad agencies in crafting their campaigns, including the stations on which the ads are to be placed.

The new 4A’s best practices statement would seem at first blush largely to fill that hole. As noted above, the announcement was met with laudatory statements from two Commissioners. Commissioner Copps effused that “[t]hese best practices from the advertising agencies will pave the way for more equal treatment,” and that they will have “a positive impact in communities across the country.” 

Hold on there. Let’s take a look at the actual language of the “Non-Discrimination Policy Related to Vendor Selection”.

NON-DISCRIMINATION POLICY RELATED TO VENDOR SELECTION

[Insert here name of agency: hereafter Agency] is dedicated to a policy of equal opportunity for all media vendors, suppliers and agents (“Vendors”). Subject to the protection of Agency’s and its clients’ confidential information, Agency will clearly communicate selection criteria to all appropriately qualified Vendors. Consistent with each Agency client's marketing communications strategies, effective media target audience planning, and efficient media buying practices, Agency policy is to grant equal opportunity to all such Vendors.

Complaint Review Process

A Vendor that feels it has been the victim of discriminatory buying practices by Agency shall be provided the opportunity to voice its dissatisfaction through Agency’s complaint review process. For purposes of this review process, discriminatory buying practices shall be defined as any buying policy that is in conflict with FCC media regulations, and thereby negates equal opportunity.

Agency will provide each of its Vendors with the opportunity to present in writing the basis of its dissatisfaction to Agency’s Discrimination Complaint Review Committee. Based on its findings, the committee may request a meeting with the Vendor to discuss all pertinent information related to the complaint.

Consider that language carefully: the equal opportunities to be accorded Vendors are to be “[c]onsistent with each Agency client’s marketing communications strategies, effective media target audience planning, and efficient media buying practices” (we added that emphasis.) What does that mean? Doesn’t it expressly acknowledge that “audience target[ing]”, “marketing strategies” and consideration of “efficien[cy]” are factors which are to be accommodated in the quest for “equal opportunity” for vendors? 

How would that work in practice? 

For example, what if a promoter hoping to sell season tickets to the opera believed, based on reliable and objective market research, that he could more efficiently reach his target audience by advertising on, say, a news/talk station rather than on one with an Urban format? This isn’t to say that no Urban listener would ever buy a ticket to the opera; but if you’re looking to reach a lot of opera buffs all at once, assume that the available research strongly indicates that by far your best bet is with news/talk audiences and not with Urban audiences. If the advertising agency representing that promoter acted accordingly and imposed a “No Urban” limitation on its ad buys, would that still be OK according to the 4A’s non-discrimination policy?  

What about an importer of a food product considered a delicacy among some South American cultures who wishes to advertise that product exclusively on Spanish-language stations – to the exclusion of other foreign-language or English language stations, including Urban music stations – would that be acceptable? 

Both approaches would seem to pass muster under the new 4A’s policy – since the buys in question would be (a) in line with the client’s marketing strategies and (b) designed efficiently to deliver the client’s message to the client’s chosen target audience. And neither approach appears to be motivated by any pernicious racism. But both approaches would, at least arguably, discriminate on the basis of race or ethnicity, and both would appear to involve the type of express “No Urban” order that the FCC seems intent on stamping out. Is that what the Commission had in mind?

And beyond that, when a Vendor that believes it has suffered from discriminatory buying practices, the 4A’s policy statement affords that Vendor an opportunity to express its concerns through a complaint review process. For purposes of this process, discriminatory buying practices are defined as “any buying policy that is in conflict with FCC media regulations, and thereby negates equal opportunity.” But there are no FCC rules (or “media regulations”) whatsoever on this subject. Nor are there likely to be. Sure, the FCC has raised its eyebrows at buying practices that exclude certain stations, and it has required broadcast stations to certify that they themselves maintain nondiscriminatory contracting practices, but the FCC has no jurisdiction over either the advertisers or the advertising agencies that make the actual buying decisions. So the 4A’s policy on its face does not impose any blanket prohibition against any particular type of advertising restriction.

This is not to say that we think for a minute that the 4A’s promotes improper discrimination or that its new policy is just a cleverly worded effort to sidestep the FCC’s wishes while seeming to embrace them.

Rather, the 4A’s policy appears to be a genuine, good faith effort to acknowledge and address the fact that the purchase of advertising, by its very nature, is a fundamentally discriminatory activity. Not “bad” discriminatory, but discriminatory in the sense that the advertiser has to decide where to spend his/her/its limited advertising dollars, and that decision-making process requires the drawing of lines. And when an advertiser draws lines, discrimination is occurring – discrimination based not on bias against race or ethnicity, but on the advertiser’s ability to achieve his/her/its particular commercial goals. 

With that in mind, perhaps it’s time to take another look at this whole issue, starting with the unarguable premise that all players in the advertising game are in it to make money. From the advertiser’s point of view, the goal is to sell as much of the advertiser’s product as possible. No non-discrimination policy will deter advertisers from attempting to meet that goal as efficiently as possible. Perhaps the 4A’s new policy, with its less-than-absolute language and its apparent acknowledgment of the priority of advertisers’ strategic interests, may be the best policy after all.

Now if only the FCC would recognize the practical reality that not all “discrimination” – including some discrimination which might arguably be based on race, ethnicity, gender or other factors – is necessarily unlawful, inappropriate or even undesirable.

A couple-three years ago, we warned readers that the staff of the FCC’s Media Bureau appeared to be browsing the websites of broadcast stations, checking for compliance with the EEO rules. Actually the FCC staffers were then apparently checking for compliance with an imaginary EEO requirement that didn’t – and still doesn’t – exist, but the important take-home message was the same regardless: FCC staffers were inspecting broadcasters’ websites.

It appears that that practice continues.

Recently, an FCC staff member emailed us, questioning whether one of our clients had posted its annual EEO report on its website. (As noted below, the rules do require such posting.) The staffer reported that she had been unable to find the report on the site. Happily, we were able to confirm (and demonstrate) that the report had in fact been posted – albeit not necessarily in the most obvious place on the station’s site – and the staffer apparently went away satisfied.

But that encounter prompts us to remind broadcasters that their websites are wide-open for inspection by anybody, including FCC staffers.  And nowadays those staffers are apparently motivated to engage in such inspection in connection with the license renewal process, which is swinging into high gear. (Two batches of renewals have been filed already, with more to come at two-month intervals for the next few years.)

The Commission’s rules currently specify only one type of “public file” document that must be included on a station’s website (assuming, of course, that the station has elected to have a website): the licensee’s most recent annual EEO report, the specs for which may be found in Section 73.2080(c)(6) of the rules. (Obscure regulatory factoid: The public file rule technically still requires that DTV transition education reports – Form 388 – be posted on websites. However, since the retention period for those reports is only one year, and since all but a dozen or so TV stations completed their move to digital more than a year ago and thus no longer have to file Form 388, the continuing impact of that particular requirement is minimal at this point.)

Of course, stations with fewer than five full-time employees are exempt from the annual EEO report requirement. But if you are not exempt, and if you do have a website, it would be a good idea to be sure that your most recent EEO report is posted there. While the rule does not specify how prominently the report is to be posted, it would probably be a good idea to make it pretty darned easy to get to the report from the station’s home page. That should assist FCC staffers in locating the report at your site – thus enabling them to move on to somebody else’s site that much quicker.

Our recent interaction with the staff did not indicate that the FCC is looking to dole out fines to stations that don’t happen to have posted their reports as required. But you never know.

From our Unintended Consequences File:  The recent Third Circuit decision on multiple ownership rules – which took the Commission to task for failing to do more to promote minority and female broadcast ownership – has led to the abrupt termination of a Commission policy intended to (wait for it) promote minority and female broadcast ownership. While there remains at least a chance that that termination may be forestalled, a recent public notice from the Commission has set the termination process in motion. 

Under the policy at issue, the Commission extended unbuilt broadcast construction permits by 18 months when they were assigned to “eligible entities”. An “eligible entity” was generally defined as an entity that qualified as a small business under the standards of the Small Business Administration for industry groupings based on revenue. The policy was first announced in the Commission’s Diversity Order released in 2008, as part of a wide-ranging agency effort to promote “diversity”.

As we reported earlier this month, the Third Circuit found that the FCC had not shown how its revenue-based definition of eligible entity would advance its goal of promoting minority and female ownership of broadcast stations. Accordingly, the Court tossed the policy, preventing the Commission from continuing to utilize it at all.

In response, the Commission has issued a public notice alerting potentially affected permit holders and prospective permit assignees of the effect of the Court’s decision.

To understand the way the shut-down will work, you have to understand the concepts of (a) “finality” of FCC actions and (b) issuance of the “mandate” relative to the court’s action.

The court’s decision becomes effective when the court issues its “mandate” to the Commission, telling the Commission that the agency's got to comply with the court's decision. Under the Federal Rules of Appellate Procedure (Rule 41, if you’re checking), an appellate mandate is supposed to issue seven days after the deadline for seeking rehearing has passed or, if rehearing is sought, then seven days after rehearing is denied. The deadline for seeking rehearing is 45 days after the court’s opinion is issued. Note, however, that parties can also ask the court to hold off on issuing its mandate. The Third Circuit decision was issued on July 7 – which means that the deadline for seeking rehearing would ordinarily be August 21 and, if rehearing isn’t sought and the issuance of the mandate isn’t delayed, we can expect to see the mandate pop out on August 29 (August 28, technically the seventh day after August 21, being a Sunday).

Applying those concepts to the problem at hand, the Commission has come up with the following.

CP-extending “eligible entity” application grants that become final prior to the issuance of the Third Circuit’s mandate are safe – they will not be affected by the Third Circuit’s decision. This means that any such application whose grant showed up on a public notice issued at least 41 days prior to August 29 should be OK. (We do the math so you don’t have to: 41 days prior to August 29 is July 19.)

But any such grant that has not become final as of the issuance of the mandate has big problems.  In such cases, the expiration date of the construction permit at issue will automatically revert back to its original, non-extended date. If that non-extended date has already passed and the permit has, thus, expired, the staff will rescind the grant of the assignment application and dismiss the application (since, technically, there’s nothing left to assign). If the non-extended date has not yet passed, the grant of the assignment will remain in effect – but the assignee will be subject to the permit’s original construction deadline, and the likelihood of getting that deadline extended is negligible.

For any CP-extending “eligible entity” assignment application that hasn’t yet been acted on, the news is equally grim. Any such application involving a permit that has already expired will be summarily dismissed. If the permit hasn’t expired, the Commission will process the assignment, but the buyer will be getting the permit as is, without any extended construction deadline. Again, the likelihood of any such extension is negligible.

Is there any ray of hope here? If the Third Circuit’s mandate is delayed, presumably the Commission’s ax won’t start to fall right away, which could afford some valuable time in some instances. What are the prospects for such a delay? Who knows? The Third Circuit’s decision was expansive and, at least to some, controversial. It’s possible that some private parties, or maybe even the Commission, might be inclined to seek rehearing. That could delay the issuance of the mandate by several months, possibly affording relief to some. So, too, could an effort to bring the case to the Supreme Court (although that alone would not necessarily stay issuance of the mandate – a request to hold off on that issuance might need to be filed).

The Commission’s public notice does not address that delay possibility, presumably because the one thing we know for sure at this point is that, absent rehearing efforts, the rules provide for issuance of the mandate on August 29. And while the possibility of delay may exist in theory, it’s a very thin reed on which to rest any hopes.

So a policy designed to increase diversity in broadcast ownership is being deep-sixed by a court decision which complained of the lack of diversity in broadcast ownership. And so it goes.

If you’re a TV licensee providing over-the-air feeds to one or more distant translator/LPTV/Class A stations, cable head-ends or satellite local receive sites, heads up. You need to act soon if you want reception of your signal at those sites to be protected from unlicensed devices operating in the TV band. April 5, 2011 is the deadline for TV stations with receive sites more than 80 kilometers beyond their protected contour to seek a waiver of the Commission’s geographic limitation to be able to register such receive locations. Note: this is a one-time-only opportunity.

Back in 2008, when the Commission adopted rules to govern the operation of unlicensed devices in the so-called “TV white spaces”, it sought to protect existing TV operations by establishing a database in which certain locations requiring protection could be registered. While receive locations that happen to be within a TV station’s protected service area were already routinely protected, that wasn’t the case for receive sites serving distant TV translator/LPTV/Class A TV stations, satellite or cable (MVPD) services, all of which deliver the signal to viewers outside the originating station’s protected contour. The Commission decided to protect, within reasonable bounds, the ability of such stations and services to receive programming over-the-air for retransmission.  “Within reasonable bounds” in this context meant within 80 kilometers of the originating TV station’s protected contour. Translator/LPTV/Class A stations and MVPD services with receive sites so located were thus allowed to register their sites in the TV bands device database.

The initial 90-day waiver request filing period will expire on April 5, 2011. (Facilities that meet the geographic standards but don’t get licensed until later will have 90 days, starting with commencement of operation, to file for a waiver.)

Waiver requests should demonstrate how the operation of an unlicensed device near the relevant receive site would act to disrupt current patterns of television viewing. After a waiver request is received, the FCC will put it out for public comment and then will make a determination as to whether it will be granted.

The Commission has not yet provided any special instructions for the filing of such a waiver request.  Check back here for updates on that score. But absent any such instructions, it would appear that filing through the Secretary’s office with a reference to ET Docket Nos. 02-380 and 04-186 should do the trick. Electronic filing in the dockets might also be a possibility – but, again, the FCC hasn’t given any guidance yet. We’ll post a follow-up on this as developments warrant.

As all full-power DTV licensees and permittees presumably know, the FCC requires that they file a “Digital Ancillary/Supplementary Services” report on Form 317 on or before December 1, a deadline which is fast approaching. But does that requirement apply as well to digital Class A television, LPTV, and TV translator licensees? 

The short answer is apparently not, thanks (it seems) to our old friend, the Paperwork Reduction Act (PRA).

Form 317 is used to report whether, during the 12-month period ending the preceding September 30,  a DTV station has provided any ancillary or supplementary services for a fee and, if so, how much revenue the station received. If there were any such services, the licensee/permittee must fork over five percent of the gross revenues it received. (Ancillary or supplementary services are defined to include any services that are provided using the portion of a facility’s spectrum that is not needed for its required one free broadcast signal. Multiple video streams that are received free by the public are not considered to be ancillary or supplementary services.) Originally the requirement applied only to full-power stations.

So far, so good.

But a job is never really done until the paperwork’s been completed, and it appears that the Commission came up a little shy in that department. 

First, the Commission didn’t bother actually to revise the form. As a result, even today the instructions still call for only digital television licensees and permittees to file, with no mention at all of Class A, LPTV or TV translators. Mind you, the instructions have been changed in the interim to specify permittees in addition to licensees as required filers. That change was made to conform with a 2008 expansion of the universe of filers (originally, only licensees, but not permittees, were required to file). But the low power services remained forgotten. 

Second, and perhaps as a result of the first issue, the Commission never bothered to ask the Office of Management and Budget (OMB) for its approval to impose the Form 317 reporting requirement on the low power universe – a step which is required by the PRA, as the FCC has acknowledged both generally (here) and with explicit respect to the inclusion of Class A’s, etc., in the Form 317 club.

Oops. 

(OMB records indicate that, between 2004 and today, the FCC twice sought OMB approval of Form 317 revisions, but in neither of those submissions did the FCC even allude to, much less specifically address, Class A, LPTV or TV translators.)

Whether the FCC’s past failure to follow up on this was a matter of design or inadvertence, the Commission appears finally ready to take the official plunge. In October, the Commission published a notice in the Federal Register (a) advising of its plan to revise Form 317 to require Class A TV, LPTV, and TV translator stations to file, and (b) requesting comments on that plan. After any responsive comments have been filed, the FCC will ship the revised form off to OMB for its review. But since the initial deadline for comments to the Commission isn’t until December 20, OMB isn’t likely to see the proposed revision until late December/early January, at which point OMB will invite another round of comments.

These circumstances appear to make it impossible for Class A TV, LPTV, and TV translator stations to be required to meet the December 1 Form 317 filing deadline. 

Even if Form 317 is not filed, a Class A or LPTV station has to pay 5% of ancillary services revenues to the government. Some have filed Form 317 to establish on the record that they do not in fact owe any fees. But for those who prefer to minimize paper work (even electronic paper), the FCC cannot take any enforcement action this year against those who do not file.

Be ready for next year, though!

Look for diversity to start raining down from the skies. The FCC has finally filled in the details for implementation of the Sirius/XM set-asides which were initially approved, in non-detailed terms, more than two years ago. Those new rules are set to be implemented by April 17, 2011.

But the diversity we’ll be seeing may be different from the diversity that some folks might have expected.

Back in 2008, the FCC decided to let XM and Sirius merge. In response to objections that maybe, just maybe, reducing the number of satellite radio services from two to one might reduce competition and diversity, XM and Sirius took a bold step: they made a number of “voluntary” commitments aimed at defusing those objections. (We put “voluntary” in quotes here because the Commission’s 2008 order granting the merger made clear that, without those commitments, the merger would not have been approved.) One of those commitments involved setting aside 4% of the capacity on each of the Sirius and XM platforms for long-term leases for noncommercial educational (NCE) programming and programming by one or more “Qualified Entities”.

The Commission approved the merger with those commitments attached; it also set a deadline for implementation of the commitments, but told the parties it would get back to them relative to just how that condition would be implemented. That was in July, 2008. Since then, the FCC has repeatedly, on its own motion, extended the implementation deadline while struggling to work out details – thereby illustrating the truth of the old saying that “the devil is in the details.”

One of the thornier details confronting the Commission: the definition of “Qualified Entities”. 

The definition which Sirius and XM came up with (noted above) was explicitly race-based. Not surprisingly, the constitutionality of such a provision was questioned by some and defended by others. The defenders argued that the racial/ethnic identity of programmers would promote diversity. Challengers, on the other hand, argued that such governmental race/ethnicity-based decisionmaking is very likely unconstitutional under the Fifth Amendment's equal protection clause.

The Commission decided that it would rather switch than fight. Preferring to avoid prolonged litigation on the constitutionality of the definition of “Qualified Entity”, the FCC has opted instead for race-neutral criteria. Gone are references to race or ethnicity. Now, a Qualified Entity is one that does not share ownership, officers, directors, or employees with Sirius/XM and which has not had a relationship for the delivery of programming to Sirius/XM within the past two years. While certain constituencies are sure to be unhappy about this decision, as a practical matter it has eliminated further years of potential litigation-induced delay. 

(An interesting aspect of the newly-announced definition: broadcast licensees are now eligible for some of the set-aside channel capacity.)

Having expanded the universe of potential channel lessees considerably, the Commission also decided to let Sirius/XM pick and choose from among the Qualified Entities to decide who the lucky ones will be. As long as Sirius/XM sticks to certain established guidelines, it gets to make the call. The Commission figures that Sirius/XM will be better able to determine whether any potential lessee might create technical issues and otherwise have the wherewithal, financial and otherwise, to follow through on its proposal. (By deferring to Sirius/XM, the FCC manages to dodge yet another potentially sticky Constitutional issue – this time involving the First Amendment.)

Among the criteria which the FCC expects to use Sirius/XM are whether:

• the lessee would provide a new source of programming or be a new entrant;
• the lessee’s programming would serve historically underserved groups;
• the lessee would provide a diverse viewpoint; and,
• the lessee would, in Sirius/XM’s reasonable judgment, be able to meet its obligations and delivery programming throughout the entire lease term. 

Leases available for the set-aside capacity will run for at least five years.  And get this - Sirius/XM can't charge lease payments for any of these set-aside channels (although it may impose "customary terms, fees and conditions", whatever those may be).

The Commission will monitor to ensure a fair and transparent decision-making process. Sirius/XM must set up a public website or similarly accessible source to inform interested entities about the application process (e.g., how to apply, eligibility requirements, selection criteria). No more than half of the available channels may be leased to broadcast licensees, and no more than four channels may be leased to any one entity. Sirius/XM may divide up channels into share-time arrangements or not, as it sees fit, and may offer different deals to different programmers.

Once Sirius/XM picks lessees for the set-aside channels, it’s going to have to submit its selections to the FCC’s Media Bureau before inking any leases. The Bureau’s role will be not to second-guess Sirius/XM’s choices, but to confirm that the correct selection process was followed. If the Bureau doesn’t disapprove within 45 days, then the selections will be deemed to be approved – at which point Sirius/XM may enter into the leases.

The set-aside channels, which will not be subject to editorial control by Sirius/XM, must be available to all subscribers. Sirius/XM must allow its lessees to advertise, but it may not require that them to accept advertising from Sirius/XM other than normal cross-promotion of other channels on the system. All of the leases must be in place by the April 17, 2011, implementation deadline, though the commencement date of service is still up in the air.

Anyone potentially interested in applying for some of the set-aside capacity (and, with no lease payments payable, who wouldn't be interested?) should keep an eye out for announcements from Sirius/XM. But be aware that anyone disappointed by the FCC’s order could seek reconsideration or review of it, which might gum up the works for a while longer. We’ll try to keep you posted as developments warrant.

Recently, the Minority Media & Telecom Council asked the FCC to suspend enforcement of the EEO rules for three months. (You can read MMTC’s request here; alternatively, you can read our monthly Memo to Clients summary of the request here.) At this point, it’s anybody’s guess as to whether the FCC will grant MMTC’s request – although, frankly, if even MMTC is asking that EEO enforcement be suspended, the Commission really should be wondering what’s wrong with this picture.

But regardless of what the Commission eventually does, it might want to take this opportunity to clean up at least one aspect of its EEO “Broadcast Mid-Term Report” (FCC Form 397) that seems oddly and unnecessarily confusing, if not flat-out inconsistent.

Form 397 is a cute little three-page form. The first page calls on the reporting licensee to provide its name and contact information and identify the stations covered by the report. No real surprises there.

But on page two, Section I consists of the following single yes/no question:

Does your station employment unit employ fewer than five full-time employees, if television, or fewer than eleven full-time employees, if radio?

Not an overly complicated question. Then the form reads:

If yes, you do not have to file this form with the FCC. However, you have the option to complete the certification below, return the form to the FCC, and place a copy in your station(s) public file.

This last instruction raises an obvious question – i.e., who in his right mind would “opt” to file a form that the FCC specifically says does not have to be filed? – but that’s not the problem. Rather, the problem arises from the fact that the “filing instructions” located immediately above Section I include the following:

If a television station employment unit employs fewer than five full-time employees, only the first two pages of this report need be filed.

So does that mean that TV stations with fewer than five have to file a report (even if the report is limited to only two pages), or does it not have to file anything at all (unless, of course, it opts to)?

Oh, and did we mention that the underlying rule (47 C.F.R. §73.2080(f)(2)) provides that

The Commission will conduct a mid-term review of the employment practices of each broadcast television station and each radio station that is part of an employment unit of more than ten full-time employees four years following the station's most recent license expiration date as specified in §73.1020.

Let’s get this straight. If you’re a TV licensee with fewer than five full-timers, according to Form 397 either “you do not have to file this form” or “only the first two pages of this report need be filed”. Huh? And Section 73.2080(f)(2) isn’t much help in sorting this out, since that section could be read to say that mid-term reports are expected from TV stations with more than ten FT employees – even though the 2002 Report and Order adopting the rules makes reasonably clear (check out Paragraph 153) that the Commission intended to limit mid-term EEO reviews to TV stations with five or more FT employees.

There is at least one possible way (see “Suggested Solution”, below) to twist this regulatory Rubik’s cube to make all the seemingly incongruous parts look consistent, but really, would it be that hard for the FCC to take the time to articulate its requirements clearly and consistently in the first place? Sure, we know that the number of TV stations with fewer than five full-time employees may be limited, but is that any excuse for at-best-ambiguous-at-worst-hopelessly-inconsistent forms?

Step 1: Understand that Section 73.2080(f)(2)’s clause reading “that is part of an employment unit of more than ten full-time employees” refers only to the term “each radio station”, and not to “each broadcast television station”.  That reading is not absolutely dictated by the grammatical structure of the particular sentence in question, but it’s also not clearly foreclosed by it.

Step 2: Since “television station” in Section 73.2080(f)(2) is not modified by the “more than ten” clause (see Step 1), refer back to the prefatory language of Section 73.2080(f). That language limits the reach of that section (including its subsections, such as 73.2080(f)(2)) to employment units with “five or more persons in full-time positions, except where noted”. Thus, the term “television station” as it appears in 73.2080(f)(2) can be read to be limited to TV stations with five or more full-timers. That assumes, of course, that the “except where noted” phrase in the preface is intended to refer to – and except out – the “more than ten” clause in (f)(2). Again, that assumption is not absolutely dictated by the rules’s language, but it’s also not clearly foreclosed by it. 

Step 3:   Assume that the FCC really means it when it says (in Section I of Form 397) that TV licensees with fewer than five FT employees “do not have to file this form with the FCC”.

Step 4: Assume that, when the form’s instructions say that “only the first two pages of this report need be filed” by TV licensees with fewer than five FT employees, it really means that those pages need be filed only if the licensee chooses to go ahead and file a report even though it doesn’t have to.

End result: TV employment units with fewer than five full-time employees need not file any mid-term EEO reports.]

What would you think about a tower safety device that reduces the number of aircraft collisions with towers, is environmentally friendly, and eliminates the need for towers to be continually lit? Too good to be true? Perhaps, but OCAS, Inc. (a company founded by two former military pilots) has petitioned the FCC for approval of just such a system.

Specifically, OCAS has asked the Commission to add a new Subpart T to Part 87 of its rules in order to allow its Obstacle Collision Avoidance System (OCAS ® – hence the company’s acronymic name) to be widely deployed. The technology at work here is similar to air-to-air collision avoidance systems in use for some time now. In fact, the OCAS system itself has been used in a number of locations worldwide, including at some U.S. government (shh!) installations. In light of its successful operations over a period of time – not to mention marketplace demand for an improved obstacle warning system – OCAS is asking the Commission to make the rule changes necessary for the system to be much more widely-used.

The OCAS system consists of three basic components: a low-powered continuous wave radar; an energy supply source to turn on and control the lighting on the structure; and a VHF radio which can transmit simultaneously on virtually all aviation-band frequencies.

This system – on paper, at least – screams “user-friendly”. From the operational standpoint, the software governing each individual OCAS® unit can be adjusted to account for unusual terrain at a particular site. Plus, because the tower lights are activated only when an aircraft flies uncomfortably near the tower, use of OCAS® would both save on power costs and extend the life of tower light bulbs. As an added bonus, OCAS could take charge of the required tower monitoring chore and send daily status reports to the tower owner. 

And Mother Nature should be pleased as well:  the fact that the towers no longer would be constantly illuminated should decrease the incidence of fatal bird/tower collisions, since such collisions have been blamed on the disorienting effects on birds of constantly-lit towers.

Overall, with the exploding demand for tall structures – e.g., communications towers, obviously, but also power-generating wind turbines – the OCAS system may be an idea whose time has come. Check back here for updates – we’ll let you know if and when the FCC requests comments on this petition.

From our “Hey, Whatever Happened To . . . ?” file, here’s an update on the new (well, at least it was new a year ago) complaint process relative to the closed captioning rules for video programming. That process was first announced in November, 2008, but has still not yet gone into effect.

As we reported back in November, 2008 (and again in January, 2009), the new complaint process – set out in a Declaratory Ruling, Order and Notice of Proposed Rulemaking released in November, 2008 – requires that the recipient of an incorrectly addressed closing captioning complaint forward that complaint on to the correct party. For example, the complainant might have written to her cable company – since that’s who she normally writes her monthly subscription checks to – not realizing that the party really responsible for the complained-of captioning issue was a program producer or distributor unrelated to the cable company. Under the new rules, the cable company would be obligated to forward the complaint on to the right folks.

As it turns out, that raises a problem.

So it’s back to the drawing boards – in a public notice the Commission has indicated that it will be releasing a Notice of Proposed Rule Making to seek comment on how to deal with this problem. In the meantime, the Commission is temporarily staying the effective date of this rule provision. The FCC further emphasized that other provision of the new rules would take effect as scheduled.

On another captioning complaints front, the Commission has announced in a separate public notice the implementation of a new electronic webform that will allow video programming distributors (VPD’s, a universe which includes cable and satellite operators, television stations and the like) to submit their contact information to the FCC more quickly, accurately, and efficiently. As part of the November, 2008, captioning complaint process, the Commission required VPD’s to submit their contact information by mail or by e-mail. While those options will remain, use of the new webform is strongly encouraged. Its use eliminates the risk of transcription errors by the Commission’s staff, lessens the staff time involved, electronically checks to make sure that all required data is provided, and makes the information available more quickly. In lauding the new system’s benefits, however, the Commission was a little less than clear on precisely how and where the electronic filing is to be done, but we are sure that all will become known.

The November, 2008, captioning complaints process – minus the complaint-forwarding aspect which, as noted above, is on indefinite hold – won’t take effect until the FCC has issued a public notice (in the Federal Register) advising that the Office of Management and Budget (OMB) has approved the process. According to OMB’s website, OMB approved the captioning complaints process last July. However, the Commission has not followed up with the required Federal Register notice of that approval, so the process is still technically not in place. When that will change, we do not know as yet. While we might expect the Public Notice announcing the effective date to be forthcoming shortly, you never know. One potential delaying factor that could crop up involves implementation of the electronic webform. Once the webform requirement kicks in, thousands of contact information filings will be expected within 30 days of the effective date. Obviously, the on-line form will need to work technically, so we may hope that any delays in implementation are the result of careful beta testing. In the interim, TV licensees and other VPD’s should be getting their contact information together.

As some may recall, the difficulties that have kept these MX groups of applications pending so long arose when auctions were adopted as the method of picking a winner from among mutually exclusive applicants. The statute authorizing auctions provides that all authorizations for commercial broadcast stations must be auctioned but that noncommercial stations can’t be auctioned. When the auction rules were adopted, however, the Commission already had pending groups of MX applications that included both commercial and noncommercial applicants. What to do?

In 2003, the Commission decided that it would simply dismiss all of the noncommercial applicants that are MX with commercial applicants for the same channel. Then, in its Memorandum Opinion and Third Order on Reconsideration in December, 2008, the Commission decided that it would be too harsh to dismiss the noncommercial applications because of processing changes that had taken place after the applications were filed. Accordingly, the Commission gave noncommercial applicants in that peculiar situation one last chance to amend their applications to specify commercial operation, which would then clear the way for an auction. (Applicants which chose not to so amend were told that their applications would be dismissed.) The Commission directed the Media Bureau to open a window for such amendments. When we blogged about that direction, we indicated that we expected that the Bureau would be moving forward “in the near future” – how were we supposed to know it would take ten months?

In any event, the Bureau has now issued its call for amendments. The only applicants eligible to amend their applications are the noncommercial applicants listed in the 19 remaining MX groups, and the only amendments that will be accepted are those for the sole purpose of specifying commercial operation. No other portion of the application may be amended. Any NCE application that has not been amended by October 30 will be dismissed. After those dismissals, presumably the Commission will move forward with an auction among the surviving applicants. Of course, it remains to be seen how many applicants still care, or even remember that they have an application pending, some 12 to 15 years later.

In the midst of wildfire season in California and hurricane season on the coasts, the Commission has issued a public notice reminding stations everywhere – not just in Cali or on the coasts – of their obligation to make emergency information accessible to those with either visual or hearing impairments. As stations in the danger zones have learned from past experience, there are no exceptions to this requirement, and no excuses will be accepted. The latest public notice makes clear that this policy applies in areas well away from the zones directly affected by the emergency conditions.

The obligations in question here arise from Section 79.2 of the rules, which requires that all video distributors make “emergency information” “accessible” to those with visual or hearing disabilities (the latter by closed captioning or other visual means). “Emergency information” is defined by the Commission to mean information “about a current emergency, that is intended to further the protection of life, health, safety, and property, i.e., critical details regarding the emergency and how to respond to the emergency”.

The bottom line is this: All emergency information aired by the station which includes information about what areas are affected, evacuation routes, methods of taking shelter in place, and the like, must be made available both visually and aurally, without exception. The substance of even an off-hand remark, if it contains any relevant information, must be conveyed in a way that makes it accessible to the visually and hearing disabled. 

The method of providing this information can be somewhat crude, such as holding up a handwritten board or reading information aloud, but regardless of how it is done, it must be done. Any crawls must be accompanied by an aural tone to alert visually impaired viewers to tune to another information source, such as the radio. Obviously, the Commission wants to be sure that everyone potentially in danger knows what to do to remain safe. While some might think that the Commission has sometimes gone a bit overboard in requiring even seemingly casual observations to be conveyed, at least most would agree that protection of life and property from imminent danger is an important goal.

The recent public notice also underscores the wide geographical range of the requirement. We are now reminded that the absolute accessibility requirement applies not only to areas in actual danger but also to those which might be logical evacuation areas. Along these lines, the concept of “emergency information” includes, for example, where evacuees from the danger zone may obtain relief assistance. (This interpretation could come as a surprise to stations located many miles away from a natural disaster, although the Commission did invoke this reading of the rule in 2005, in the case of Hurricane Katrina.)

The Commission also reminds us that some national events might be of local interest and subject to the requirements of Section 79.2, regardless of the lack of any actual local impact. It does not, however, provide any guidance to stations on figuring out when an event might fit into this category.

Network affiliates in the top 25 markets have a significantly greater burden in this area. Those stations are required, by hook or by crook, to arrange for closed captioning services. The Commission cuts such stations a little slack by allowing them time for the captioning personnel to travel to the station, but in the meantime any emergency information being broadcast must be made accessible to the disabled by some method. 

Additionally, depending on affiliation and market, some stations are allowed to use the electronic newsroom technique (ENT). Such stations must make sure that their ENT systems caption non-scripted materials; if the systems don’t caption such materials – whether automatically or as a matter of choice by the station – the station must still make sure that all emergency information is disabled-accessible in some manner.  

Perhaps most importantly, the Commission emphasizes that it is the responsibility of the local station to make sure that all emergency information is accessible, regardless of whether the station is viewed over the air or on cable or satellite.

While pre-October 1, 2008, termination of analog operation was clearly the exception rather than the rule, it appears that stations which did shut down their analogs before October 1 are getting a free reg fee ride this year. In looking through the Commission’s recent reg fee order, we noted the following statement relative to DTV operation: “[S]tations that were broadcasting in digital only on October 1, 2008 would not be assessed regulatory fees for their digital license for FY 2009.”  (Stations that were broadcasting in both analog and digital modes as of October 1, 2008, however, will be required to pay regulatory fees, but those fees relate only to the analog operation.)

This exemption is limited: it does not get eligible stations off the hook for other regulatory fees that may be due, such as those for studio-transmitter links, remote pick-ups, satellite earth stations, and the like. Rather, the exemption relates only to the reg fee for the main broadcast license. (Of course, the payment for that license normally represents the lion’s share of the amount due.)

The FCC’s largesse is consistent with its treatment of DTV for the past several years.

TV licensees which shut down their analog operations before October 1 should take a close look at the reg fee postcards they receive from the Commission to see whether that early termination was taken into account in determining the fees due. Our guess is that it will not have done so. 

If that’s the case, the next step is not entirely clear. Since the reg fee order clearly indicates that a fee exemption applies, such stations should theoretically be able simply not to pay the reg fee for their main license. However, it would probably be a good idea to round up evidence – and maybe even submit it before the deadline for reg fee payments – to demonstrate that the station was digital-only by October 1, 2008. Otherwise, it may be necessary to go through the dreaded process of demonstrating to the FCC after the fact that no fee or penalty was due. 

In any event, since the Commission could try to assess a 25% late fee if it thinks that the fee was due but not paid, it’s a good idea to take steps beforehand to avoid having to explain your position to the FCC after-the-fact. (Note that late payers may also be subject to other regulatory problems, including the very disadvantageous red-light status and increased upfront payment requirements in FCC auctions.)

The Commission also was quick to point out that regulatory fees for Fiscal Year 2010, which begins this coming October 1, will be imposed on digital licenses. After all, DTV licensees must pay “their share” of regulatory fees once the nationwide transition is complete. In the meantime, eligible stations can enjoy their one-year respite.

It’s déjà vu all over again. As expected, the Commission has acted, once again on a Friday (and yes, again on a Friday the 13th), to revise its required procedures with regard to termination of analog operations and consumer education announcements. The new order may be found here.

The changes represent something of a good news/bad news situation, but the bad news outweighs the good. While some unnecessary and/or confusing requirements have been eliminated, the consumer education announcements have been bulked up to include a lot of information not previously required. . . and various non-broadcast chores have been increased . . . and the Commission has made it difficult for major network affiliates to say so long to analog.   The clear intent of the new requirements, which are especially heavy for major network affiliates, is to discourage stations from making an early transition. 

And even if some stations undertake all the new burdens, the Commission makes it clear that the Commission reserves the right either to postpone or simply deny permission for some stations to terminate analog operations early.

(One exception: If a station changes its mind and decides to keep its analog operation going until June 12 after all, it may do so, but will be required to notify the Commission no less than five days before its originally-specified turn-off date, and it must air notices to viewers – at least four times daily, once in primetime – of the change in plans, over the five days prior to and including the originally-specified date.)

The earliest date that any commercial station, and most noncommercial stations, may pull the analog plug is April 16, 2009. Noncommercial educational stations that can certify that continuing operation would create a significant financial hardship, however, may be able to turn off as early as March 27. The FCC’s theory here is that noncommercial stations often face greater budget issues. 

Any station looking to terminate analog service prior to June 12 will have to air at least four viewer notifications a day (at least one in primetime) for at least 30 days prior to the termination. (NCE stations shutting down before April 16 will still have to run a total of 120 such announcements, distributed evenly through the period leading up to the termination.) These notices, which are in addition to the DTV education announcements which have been required for the past year or so already, must contain:

• the station’s call sign and community of license;
• the station’s plan to end analog service prior to June 12;
• the date of the planned termination;
• what viewers can do to continue to receive the station, i.e., how and when the station’s digital signal can be received;
• information about the availability of digital-to-analog converter boxes in the service area;
• the street address, email address (if available), and phone number of the station where viewers can register comments or request information. That number – which will also be used to receive calls forwarded from the FCC’s Call Center – is expected to be staffed by knowledgeable people who can help consumers with local reception issues and other engineering issues. The Commission has indicated that the people staffing the local telephone help line may be provided by the station, a group of stations, or a third party such as the state broadcasters’ association.;
• “service loss” information, if the station’s DTV signal will reach less than 98% of the population reached by its analog signal.

These notice requirements apply to all stations seeking to terminate analog operation prior to June 12. But there are additional gotchas for major network affiliates who fall in that category.

A major network affiliate must certify on its ASTN that either: (a) at least 90 percent of the people within its service area will continue to received full analog service from an affiliate of another major network through June 12; or (b) at least 90 percent of its viewers will receive “enhanced nightlight service,” or some combination of enhanced nightlight service and continued analog programming service, and that the station will comply with the other public interest requirements. The stations which will supply the on-going analog service must be specifically identified in the ASTN.

For enhanced nightlight service, stations must provide at a minimum DTV educational information and news and public affairs programming. For all stations, regardless of location or audience composition, the DTV transition information must be aired in both English and Spanish, and must have both captioning and an aural element so that both the vision and hearing-impaired may receive the information. In order to offset some of the cost, however, commercial announcements will be allowed.   The Commission indicated that a station may rely on another station in the market, but each individual broadcaster will nonetheless remain responsible for ensuring that the service is provided. The Commission has not indicated what would happen if the station upon which another station is relying suddenly has its transmitter break down.

So early termination now includes significantly increased notice requirements and substantial extra burdens for net affiliates. But wait, there’s more.

The Commission is requiring that early-terminating major network affiliates must also provide at least one “walk-in help center”. That center can be organized and operated jointly with other stations or local businesses or organizations, but each station will be independently responsible for making sure that the center meets the FCC’s specs. And those specs are detailed. Each walk-in center must include a range of very specific equipment and capabilities to assist the public in coping with the DTV transition. Oh yeah, the walk-in center must be open seven days a week, and there must be at least one broadcast station employee on-site at all times during operating hours. Each station must provide the Commission with the address, phone number and operating hours of its walk-in help center, along with the name and phone number of the station’s “point of contact” for DTV transition issues.

Stations not transitioning until June 12 are relieved of the additional requirements specified for early-exiting network affiliates. They still have additional burdens imposed, however, as the Commission has expanded the types of information now required to be conveyed in the DTV consumer education announcements and has added additional notices that must be aired. These new requirements will go into effect on April 1. They include the following:

• All stations must provide viewers with information about antennas and signal reception. If the station is changing from the VHF to the UHF signal band, or vice versa, it must provide information about the possible need for a change of antenna.
• All stations must remind viewers that they will periodically need to use the rescan function on their digital television sets and converter boxes to pick up stations in the area.
• All stations must announce the location and operating hours of walk-in DTV help centers in the market area, the FCC Call Center telephone number and TTY number, and the number the station has designated for receiving consumer calls.
• Stations that will experience a loss of two percent or greater of the population served within its Grade B service area, whether or not offset by population gains, must air service loss notices, which must describe the approximate geographic areas that will lose service. These notices are required in addition to the other consumer education notices.

Each of these new pieces of information must be included in a notice at least once a day, must air in primetime at least three times a week, and must be at least 15 seconds long.

The Commission also has changed the 100-Day Countdown Clock for those stations that chose Option 2. It will now be a 60-day clock, and it will be geared to each station’s own analog termination date. This requirement does not become effective until April 1. As of that date, all stations will be required to run a countdown to their own respective termination dates, starting on the latter of April 1 or the 60th day prior to termination.

Finally, in the area of additional notices, broadcasters that chose either Option 2 or Option 3 will need to air a new 30-minute informational video at least one day before they transition. This video must be up-to-date and also must reference local issues. This new mandate will impose significantly greater burdens, as it will not be possible for stations in various markets all to air the same program in its entirety.

One ray of sunshine, however, is that the Commission has eliminated the requirement that most stations that have already made the transition continue the consumer education announcements. Someone finally realized that the only people who could see these announcements were the ones who no longer needed help. The only exception is for stations that have not built out their full, authorized DTV facilities. These stations may not cease the announcements until their final facilities are built.

Lurking just below the surface of the Commission’s new and even more elaborate constraints on early transition is the fact that even the FCC acknowledges that some early terminations may be beyond the licensee’s, and the FCC’s, control. The Commission repeatedly alludes to the possibility that “equipment failure, natural disaster, or other unforeseeable emergency” may lead to pre-June 12 analog terminations notwithstanding any supposedly binding ASTNs or related obligations. That possibility introduces a range of unknowns and unknowables into the mix for the next several months.

Again, the Commission’s staff is to be applauded for their ability to deal with a truly daunting task expeditiously. This is not to say that the latest order is a model of persuasion. To the contrary, aspects of it – particularly its effort to justify new burdens over and above those imposed in the Third Period Review, in direct contravention of Congress’s explicit direction – are appallingly disingenuous. But, as previous posters have observed, the exigent circumstances here preclude dispassionate consideration of legalities. Whether or not the Commission has the authority to do what it’s doing, the time frames here are so short that, by the time anyone could get into court, June 12 will have come and gone.

Ideally, this most recent order will be the last of the zigs – or are they zags? – in the course of the DTV transition, as the regulatory bus lurches back and forth, pushing fitfully toward June 12. But you never know.

What a difference a couple of weeks make! Remember a week or two ago, when the FCC came out with new orders and proposals changing the DTV consumer education rules that had been in place for a year?  And remember how the new approach included the requirement that stations which had chosen DTV consumer education Option Two (the NAB plan) would have to re-start their 100-Day Countdown calendars as of March 4? The night before that requirement was to kick in, the Commission changed course again.

On March 3, the FCC waived the new-and-improved 100-Day Countdown requirement pending resolution of the February 20 Notice of Proposed Rulemaking (NPRM). So scratch that new 100-Day Countdown, at least for the time being.

The Commission is concerned – and properly so – about potential viewer confusion. The proposals currently under consideration contemplate a gradual DTV roll-out between April and June, meaning that some stations will be transitioning in advance of the new June 12 national transition date. That being the case, the FCC is trying to figure out what kind of count-down makes sense: one tied to the broadcasting station’s own particular transition schedule, one tied to the national deadline, or possibly some combination of the two, or maybe even some other alternative that includes the transition schedules of other stations as well.

That question, and others raised in the NPRM, are expected to be addressed no later than March 13. At that point the FCC will give us all instructions as to how to proceed. Until then, though, the 100-Day Countdown requirement has been waived.

In announcing the waiver, the FCC stressed that all other DTV consumer education requirements aside from the countdown remain in place in the meantime,.  Therefore, stations must continue to air their PSA’s and crawls; they just don’t have to add countdown announcements as yet. In fact, any station that has started such announcements should stop at once.

Back in November the Commission released a Declaratory Ruling, Order and Notice of Proposed Rulemaking (DRONPRM) in which it (a) imposed a number of new obligations on TV licensees and other video programming distributors and (b) sought comment on how the revenue-based per channel exemption from closed captioning requirements should be applied to stations with multicast programming streams. But as we reported back then, neither the effective date of the changes nor the deadlines for comments and reply comments would be set until the DRONPRM popped up in the Federal Register. 

Lo and behold, more than two months later, the DRONPRM was published in the Federal Register, in two separate items, on January 13, 2009. (The rule changes which were adopted appear in one document, while the proposed rule changes, on which comment is sought, appear in another.) As a result, a couple of clocks are now running.

Second, the “declaratory order” portion of the DRONPRM will be effective as of February 12. That portion was devoted to emphasizing that the shift from analog to digital would NOT alter the pre-existing captioning obligations. That is, there is no exemption for DTV programming just because it is digital. Likewise, the transition to all-digital broadcasting, whether on February 18 or some later date, does not relieve stations of the obligation to continue to caption programming in a manner that can be decoded by analog TV sets. Finally, the transition does not open up the opportunity for stations to claim the self-implementing exemption for channels with less than $3,000,000 in revenue or the new network exemption just because of a change from primarily analog to all-digital operation. In other words, captioning obligations are still in place, and don’t try to be too cute.

Third, the new contact information requirements and complaint process are still not yet in effect. Those items require review and approval by the Office of Management and Budget (OMB). The good news there is that, if you feel like filing comments with the FCC concerning the paperwork reduction aspects of the order – and particularly with regard to the contact information posting and notification requirements – you’ve got have until March 16, 2009, to do so. (The FCC will then presumably consider those comments in the preparation of the showing which it will have to make to OMB.)

In the meantime, the new FCC complaint process will NOT be in effect. That process calls for complaints to be filed with either the video programming distributor or the Commission, provides for a shorter turnaround time in responding to complaints, and requires stations and cable operators to provide assistance in forwarding misdirected complaints to the correct entity. Similarly, the new requirement that stations both provide and keep updated contact information for both complaints and inquiries of an urgent, primarily technical nature and those of a more general nature are also NOT yet in effect. 

If and when the OMB approves the new requirements, stations and cable operators will have 30 days in which to submit their contact information to the Commission. They will also have to post the information on their website (if they have one), obtain entries in local telephone directories, and, for cable operators, include the information in their bills.

With the release of six notices of apparent liability (NAL) at the very tail end of 2008, the FCC has given us a glimpse of what EEO enforcement is likely to look like for the foreseeable future. And the outlook is what you might expect: continued emphasis on detailed record-keeping despite the absence of any indication that any unlawful employment discrimination has occurred.

The six decisions appear to be directed to the broadest possible range of stations, with stations in the east and west, large and small licensees, minority and non-minority ownership. One common factor that all share is the age of the alleged violations: all of the alleged recordkeeping shortfalls took place at least two years ago, with most of the data going back to 2003 or 2004.   The penalty in all cases was a combination of a fine (with amounts varying from $7,000 to $20,000) and reporting conditions.

Each of the NALs arose from the Commission’s random audit program. Each year the FCC requires that randomly-selected stations submit detailed information concerning their EEO efforts. The FCC’s review process is apparently rigorous – how else to explain the multi-year timeframe from initial submission of the EEO information to the 2008 issuance of the NALs?

There are a number of lessons to be taken from the NALs.

Another word to the wise is that, if your review shows a lack of information concerning exactly where applicants came from or how they learned about the opening, change that pattern at once. Stations are required to list the total number of interviewees and the total number of interviewees referred by particular recruiting sources each year in their public file reports. In addition, should you find yourself the subject of one of the FCC’s periodic audits, it will be necessary to supply the recruitment source for each interviewee. Therefore, make sure that you keep this information as you go. The FCC acknowledges that you may not know a source for everyone who applies for a position. Nonetheless, it seems to think that if you are serious enough to interview a person, and if you actually talk to that person, you should be able to get a referral source from him or her. Accordingly, it would be prudent to ask, as an essential question to be posed to all interviewees, how they happened to hear of the job opening.

Additionally, if your stations are recruiting through only internet sources and in-house referrals, broaden your sources before you hire anyone else. The FCC has already stated that internet sources alone are not sufficient. Likewise, if recruitment efforts include only on-air announcements, you need to look elsewhere in addition. The Commission’s rationale on the latter is that only those persons who are tuned in to the station at the time that the announcement is made will know about the opening. The upshot is to not rely on only one source for recruitment, but rather to expand outreach efforts broadly. While the Commission has indicated that reliance on a single source may be enough if that source is broad enough, a better approach is to rely upon different types of recruiting.

And the final tip – which returns us to the overall theme of paperwork – is to document everything that you do in the way of general community outreach. FCC rules require that each station employment unit, depending on the size of both the station(s) involved and the size of the market, complete two to four general EEO outreach efforts in a two-year period. The stations also must keep documentary evidence of such participation, which is where some of the stations targeted in the NALs fell down on the job. Basically, even if you made the required efforts, if you can’t document them, they didn’t happen and you can’t take credit for them.

Perhaps the most intriguing common aspect of the decisions, however, is what the FCC did not allege. In none of these cases was there any allegation of actual discrimination. Rather, the licensees’ sins fell exclusively into the categories of recordkeeping and failure of adequate self-assessment. The implication seems to be that if the licensees had just kept better records of where their interviewees learned of the opening and the like, then the licensee’s employment profile (and, ultimately, the employment profile of the overall broadcasting industry) would somehow ineluctably mirror the ideal of diversity. 

There are, it seems to us, more than a few problems with the FCC’s approach here. The primary target of EEO rules should, it would seem, be actual unlawful discrimination. The failure to keep exhaustive records of interview minutiae – for example, how each interviewee claims to have learned of a job opening – does not relate to such discrimination at all. But historically, the FCC has seemed to view the goal of its EEO program to extend well beyond the enforcement of anti-discrimination laws. In defending an earlier version of that program in the U.S. Court of Appeals for the D.C. Circuit in 2001, the Commission argued that its goal was simply to assure that broadcasters engaged in “broad outreach” in their recruitment. But the Court concluded that the FCC really had a different agenda:

[If] the Commission's only goal [were to assure that broadcasters engage in “broad outreach”], then it would scrutinize the licensee’s outreach efforts, not the job applications those efforts generate.  Measuring outputs to determine whether readily measurable inputs were used is more than self-evidently illogical; it is evidence that the agency with life and death power over the licensee is interested in results, not process, and is determined to get them.

Those observations led the Court to conclude that that earlier version was unconstitutional. The current version, adopted in response to the Court’s ruling, was intended to avoid those constitutional pitfalls. But to the extent that the Commission continues to harp on results, the closer it treads to the same pitfalls.

Interestingly, Commissioners Copps and Adelstein issued a separate statement applauding the NALs and asserting that “employment in broadcasting does not reflect America” and that it is a “legal obligation” to have a “communications industry that reflects our nation’s diversity”. But that notion – that the FCC is both empowered and, indeed, obligated, to take steps to achieve some idealized industry employment profile – seems flatly inconsistent with the Court’s 2001 decision. It will be particularly interesting to see whether the Commission as it develops in the Obama administration will pursue that Copps/Adelstein line of thinking. If it does, the Commission may find itself back in court.

For the time being, though, we can expect the current EEO program, complete with annual random audits, to continue full speed ahead.