NCE On-Air Fund-Raising For Oklahoma Tornado Relief Efforts

FCC announces procedures for waiver requests by noncommercial broadcasters.

The time has come, yet again, for broadcasters to respond to a natural catastrophe with their characteristic humanity, offering help wherever and whenever possible. As the horrific stories and images from tornado-devastated Oklahoma – and particularly the community of Moore – make their way out of the storm’s heartless swath, broadcast stations may want to undertake fund-raising efforts to support relief efforts. The FCC clearly does not want to do anything to discourage such laudable humanitarian impulses. However, rules are rules – and the Commission’s rules (Sections 73.503(d) for radio and 73.621(e) for TV) generally prohibit noncommercial educational (NCE) broadcasters from engaging in on-air fund-raising activities on behalf of anybody but the station itself.

Not to worry. The Commission has historically waived that prohibition following “disasters of particular uniqueness or magnitude” – Hurricane Katrina, the 2010 Haiti earthquake, the 2011 Japanese tsunami and Superstorm Sandy come to mind as ready examples. And just to be sure that we all know that the FCC views the Oklahoma tornado to be in the same league, the Commission has issued a public notice laying out the procedures by which NCE licensees may request waivers so that they can engage in fund-raising for relief efforts.

Stations seeking such waivers should prepare an informal request providing the following basic details of their fund-raising activity:

  • the nature of the fund-raising activity;
  • the proposed duration of the activity;
  • the organization(s) to which fund will be donated; and
  • whether the fund-raising activity will be part of the station’s regularly-scheduled pledge drive or fund-raising efforts

The informal request should then be emailed to the FCC.  NCE television licensees should address their requests to Barbara Kreisman ( NCE radio licensees should address their requests to Peter Doyle ( and Michael Wagner ( Those points of contact are also available for any particular questions you might have about such things.

Enforcement Relief for "Student-run" NCE Stations

New Media Bureau policy opens door for reduced fines for first-time violators of some paperwork rules.

The FCC’s enforcement actions often leave us shaking our heads wondering if the bureaucracy recognizes the challenges faced in real life by those it regulates. But occasionally there are rays of hope.  Case in point: the Media Bureau has revised its policy for enforcing certain paperwork obligations against student-staffed noncommercial educational (NCE) radio broadcast stations. The revised policy provides an opportunity for such stations to avoid crushing forfeitures which could end up shutting the stations down.

Last July, we blogged about the stifling impact of the FCC’s forfeitures on student-operated stations. Because of frequent student staff turnover, such stations can be prone to rule violations, which in turn result in steep forfeitures often amounting to a substantial portion of -- indeed, sometimes even more than -- the station’s annual budget. That happens when the fine is based on the Commission’s schedule of “standard” forfeitures even without any upward adjustments.

While some stations hit with fines have argued to the Commission that their budgets can’t sustain the forfeiture amount, the FCC has historically ignored such claims. Instead, it has looked to the resources of the entire educational institution, rather than just the station itself, presumably (but unrealistically) assuming that the institution would pay up.  Unfortunately, as we reported in our earlier post here,even though many institutions do pay up, the threat of further severe regulatory enforcement has apparently led some institutions to sell their stations, thereby eliminating opportunities for entry and training of young people in the art of broadcasting.

But now the Bureau has a new policy.

Under that new policy, certain stations which violate certain rules will be invited to negotiate a consent decree providing for payment of a reduced “voluntary contribution” to the U.S. Treasury and commitment to a compliance plan designed to prevent future violations.

What stations are we talking about? NCE radio stations that are “student-run”. And what does that mean? According to the Bureau, for purposes of the new policy, a “student-run station” is

a radio station licensed as an NCE station to an educational institution or an entity under the control of an educational institution and which is staffed completely by student volunteers, rather than partially or predominantly by students.

That narrow definition excludes more than 85% of all NCE stations – and all commercial stations, even those licensed to educational institutions and staffed by students – but it should still be welcome by the fewer than 500 stations that are eligible to take advantage of the new policy. (Note: “student-run” stations may be supervised by a “faculty advisor”, and the term “student volunteers” includes students receiving either course credit or work/study stipends for the work at the station.) One more thing: the new policy is available only to first-time violators. If you’re a “subsequent or repeated” violator, the new policy is off the table.

What rules are we talking about? 

Rules involving “the submission of reports and other materials or public notice of information”. The Bureau cites as examples the requirement to the Ownership Reporting rule, the Issues/Programs list requirement, and the requirement to provide notice (on-air or in the local newspaper) about the filing of certain applications. 

The new policy will not be available with respect to non-paperwork violations. Thus, violations relating to improper or undisclosed underwriting announcements, misleading contests, engineering violations, or (as you might expect) obscene or indecent material will not be entitled to the new, arguably lenient approach.

And what happens when the new policy is invoked? The case which triggered the new policy provides an illustration. William Penn University is the licensee of NCE Station KIGC(FM) in Oskaloosa, Iowa, a “student-run” station with less than 250 watts of power. Its annual budget is currently $6,650. The Bureau determined from the station’s most recent license renewal application that the station hadn’t filed a number of Ownership Reports on time, hadn’t prepared a couple of Issues/Programs lists on time, and had failed entirely to prepare the remainder of its Issues/Programs lists at all. (It should go without saying that these are likely to be fairly common problems at stations with transient novice staffs.)

Normally, violations of this sort would result in a fine of $20,000 or more. But in this case, under the terms of the Consent Decree resolving the problem, the University will have to pay only $2,500 ("only" being a relative term, since in this case it represents more than one-third of the station's annual budget).. The FCC says that in the future, in determining the amount to be paid in such cases, it will take all financial circumstances into account. In other words, student-run stations caught in violations will be able to argue, for example, that their own budgets, rather than the licensee institutions overall resources, should determine the level of financial penalty imposed.

In addition to committing to making the $2,500 “voluntary contribution”, through February, 2021 (i.e., the end of the next license term), the University will have to implement a “Compliance Plan” imposing on-going obligations. In particular, the University will have to institute a number of internal logging, monitoring and training activities, over and above any required by the Commission’s rules, to reduce the risk of further violations. 

And for each of the next three years, the University will have to file a certification, signed by a University officer, affirming that the station is in compliance with the all FCC rules. That requirement could pose a challenge – after all, there are five volumes of FCC rules. Would any of our readers certify under penalty of perjury that they are in compliance with every single one of those rules – or even just all of the 419 pages of rules devoted primarily to broadcasting?

The purpose of a consent decree is to avoid litigation over a violation, so a station opting to take the consent decree option foregoes any chance to challenge the validity of the FCC’s action. It’s akin to copping a plea – although most consent decrees include a proviso that the incident cannot be used as a black mark against the station in the future. For that reason a consent decree can afford a pretty good escape from permanent harm (assuming, of course, that the licensee does indeed comply with the requirements of the decree).

In our post here last year we raised many of the reasons underlying the Bureau’s decision to change its policy.  If our discussion there helped bring about the policy change, we are pleased that we might have had some influence.

NCE On-Air Fund-Raising For Superstorm Sandy Relief Efforts

FCC announces procedures for waiver requests by noncommercial broadcasters

Broadcasters have historically responded to catastrophes with incredible humanity, offering help wherever and whenever possible.  And the devastation that Superstorm Sandy wreaked on the eastern seaboard – and particularly the Jersey Shore and NYC – has provided yet another unfortunate opportunity for that humanity to manifest itself again. As the horrific stories and images roll in, noncommercial educational (NCE) broadcast stations may want to undertake fund-raising efforts to support relief efforts. The FCC clearly does not want to do anything to discourage such laudable humanitarian impulses. 

However, rules are rules – and the Commission’s rules (Sections 73.503(d) for radio and 73.621(e) for TV) generally prohibit NCE broadcasters from engaging in on-air fund-raising activities on behalf of anybody but the station itself.

Not to worry. The Commission has historically waived that prohibition following “disasters of particular uniqueness or magnitude” – Hurricane Katrina, the 2004 Southeast Asia earthquake/tsunami, the 2010 Haiti earthquake and the 2011 Japanese earthquake/tsunami come to mind as ready examples. And just to be sure that we all know that the FCC views Sandy to be in the same league, the Commission has issued a public notice laying out the procedures by which NCE licensees may request waivers so that they can engage in fund-raising for relief efforts.

Stations seeking such waivers should prepare an informal request providing the following basic details of their fund-raising activity:

  • the nature of the fundraising effort;
  • the proposed duration of the fundraising effort;
  • the organization(s) to which funds will be donated; and
  • whether the fundraiser will be part of the licensee’s regularly scheduled pledge drive or fundraising effort.

Of course, the public notice does not guarantee that such requests will automatically be granted, but it’s a very good bet that the Media Bureau will be strongly inclined to bless Sandy-related fund-raising efforts.

These informal requests should be emailed to the FCC.  NCE television licensees should address their requests to Barbara Kreisman ( NCE radio licensees should address their requests to Peter Doyle ( and Michael Wagner ( Those points of contact are also available for any particular questions you might have about such things.

Student-Run College Radio: A Species Endangered by FCC Fines?

By beating up on college stations, the FCC creates a threat to the viability of college radio that could have unfortunate long-term effects.

The FCC has been slapping forfeitures left and right on college-owned, student-run radio stations. Three recent examples: $6,500 to a station operated by students at Bethany College in Bethany, West Virginia, $10,000 to a Rollins College station, and another $10K to a Toccoa Falls College station.

The misconduct underlying those fines was not especially earth-shattering: a late-filed renewal, some missing issues/programs lists, occasional failures to notify the FCC when the station is off the air for more than 10 days, that sort of thing. Nothing really to write home about.

We at can understand the FCC’s position. Rules are rules, and when rules get broken, there are (or should be) consequences. 

But there’s a bigger picture here that the FCC may be missing. By imposing such fines on student-run stations that are probably already money-losers for their parent educational institutions, the Commission may be hastening the demise of such stations.

And that would be a serious loss to the broadcast industry and the listening public.

Student radio, particularly at the college level, serves an important role as an incubator for future generations of broadcasters. Student radio can serve as a conduit into the industry for a broad and diverse universe of voices – precisely the type of diversity the Commission has long sought to promote through a wide range of policies. (For an interesting article about college radio, check out this recent piece published by Radio Survivor.)

Against these evident benefits, the oppressively negative impact of the FCC’s forfeiture policies can and should raise serious concern.

Our firm works with several student-operated stations. We know that college is a time for learning and experimentation. We also know that student-run stations are in many significant ways very different from normal commercial operations. The staff at a student station generally turns over at least 25% a year, as seniors leave and freshmen arrive. Institutional memory tends to be short, and basic lessons have to be re-taught and re-taught. Working with students is an endless instructional process. In that environment, mistakes will be, and often are, made. 

The college environment is supposed to encourage learning and experimentation. That environment normally tolerates mistakes that come with learning and experimentation unless the harm is severe. It is difficult to see any severe harm done in any of the recent cases involving forfeitures dealt out to student-run stations. 

But the FCC knows no tolerance – and as a result, even a harmless mistake borne of regulatory naiveté can destroy a station because, as the FCC’s historical fining practices demonstrate, the Commission cuts student-run stations no slack when it comes to compliance issues.

We spend a lot of time engaged in the challenging chore of introducing students to the importance of the FCC’s regulatory requirements. It’s easy to explain why a station shouldn’t operate at excessive power or off its proper frequency. We may even be able to keep a straight face when we spell out indecency restrictions (although some students snicker at regulations that suppress their music and forbid the use of words that are part of their daily vernacular).

EEO recruitment requirements are rather more difficult to sell because those requirements are out of date and don’t reflect the real world of 18-21 year olds. Yes, students themselves may not routinely be involved in recruiting employees, but EEO rules are a part of the Commission’s regimen, so students are schooled in even those esoterica. What’s a student in 2012 to make of a rule that doesn’t allow a station to rely exclusively on web-based recruitment? That notion is mind-blowing to students who search for everything on the web and nowhere else.

Even more difficult to grasp, on several levels, is the public file requirement. Students produce some very innovative programming, often spontaneously. Documenting that programming tends not to be a high priority for students, if they think of it at all. That’s especially true when any documentation that might be produced just goes into a file that no one has ever come to see during the memory of any current student. You can explain the theory behind the requirement until you’re blue in the face, but it won’t make a dent. 

So let’s all agree that, in the ecosystem of student-run stations, the likelihood of violations is high. Kids, like puppies, tend not to behave the way we might like, or the way that we can expect them to once they’ve matured a bit. But do we really want to penalize them in the same way we might penalize their more mature counterparts – especially when the brunt of any forfeiture will be borne not by the students, but by their educational institution?

Case in point: Bethany College has only 830 students. Where does the FCC think that the student radio station is going to come up with $6,500?

Oh sure, targeted schools can request that the fine be reduced. But in assessing such requests, the FCC relies on the income of the entire college, not just the radio station. Result: forfeitures for student stations are seldom reduced. The reaction among the Responsible Adults in a college’s administration is likely to be OMG, the kids got us in hot water with the feds. We have federal research grants and relationships with lots of federal agencies. We can’t afford to have a black mark on our record. Priority Action Items: (1) Pay fine; (2) Get rid of radio station.

And once that happens, diversity and learning suffer as young voices are silenced. 

There’s already plenty of pressure on cash-strapped universities and colleges to get themselves out of the radio business. The University of San Francisco, for example, has dumped KUSF(FM) (new call sign – KOSC). And Vanderbilt University has turned programming responsibilities for WFCL over to Nashville Public Radio through an LMA (that according to a petition to deny directed against the recent WFCL renewal). Nationwide concern about the fate of college radio generally has led to a number of activities to save that institution.

The FCC’s hefty fines don’t help make radio relevant to the younger generation or encourage learning and innovation. Every time the Commission whacks a college station with a budget-crushing forfeiture for violating rules that make no sense to students, the FCC ensures that another batch of students will enter the career world with some combination of fear and disdain for the agency rather than the respect they might have had – or, very possibly, the fine may lead those students to choose a career beyond the reach of the FCC. We find that disappointing and sad.

Wouldn’t it be more meaningful if, instead of a budget-crushing fine, the punishment for a student violation were more narrowly tailored to the circumstances? Perhaps the wrong-doer could be required to write a paper explaining the basis for the rule that was violated and outlining steps that might be taken to achieve compliance. Writing papers is something that students understand. It’s an exercise that they’re likely to remember. Of course, if the conclusions in the papers sometimes turn out to be critical of the rule, that’s something that the FCC should welcome in its ongoing quest for transparency and relevance.

FCC Eyes Easier NCE Fundraising for Third Parties

Interruption of regular programming might be permitted without prior waiver; reporting, certification requirements also in play

The Commission is asking whether noncommercial educational (NCE) radio and TV stations should be routinely permitted to interrupt their regular programming for fundraising activities for the benefit of any non-profit entity other than the station itself. The proposal is in response to a study published last June by the FCC’s Working Group on Information Needs of Communities.

Historically, because of their noncommercial nature, NCE stations have been prohibited from breaking into their regular programming for extended third-party fundraising even when the entity to be benefited was itself non-profit. (PSA’s and brief paid-for underwriting announcements are OK.) While sometimes an extraordinary need for such fundraising might arise – relief efforts in the wake of Hurricane Katrina, for example, or the Japanese earthquake/tsunami, or the Haitian earthquake – in such circumstances the Commission has been willing to waive the rule (which, technically, appears in Section 73.503(d) (for radio stations) and 73.621(e) (for TV stations). But such waivers have been limited to “a specific fundraising program or programs, or for sustained station appeals for periods which generally do not exceed several days.”  And waivers are not invariably granted.  (Case in point: Back in the 1970s a proposal to run an on-air auction to benefit a financially-distressed local symphony orchestra was nixed by the Commission.)

Lurking in the background of the latest proposal is the FCC’s apparent discomfort with the amount of air time already being devoted by NCE stations to begging for bucks. That factor is a primary reason for the existing limitation on third-party fundraising efforts. (One question the Commission poses in its Notice of Proposed Rulemaking (NPRM): Just how much airtime do NCE stations actually spend on fundraising?)

Any relaxation of constraints on third party fundraising would likely be limited.

The NPRM suggests that the FCC might allow only one percent of a station’s annual air time to be devoted to third-party fundraising – a cap that could be applied to all digital program streams for TV (although, oddly enough, the FCC seems to forget about multiple streams on digital FM stations). The length of each individual fundraising program might be limited. The Commission also asks whether such programs should be produced by the station itself (rather than the third party benefiting from the fundraising), and whether the beneficiaries should include only organizations local to the station’s service area and/or organizations with a Section 501(c)(3) exemption from the IRS.

The NPRM says that one of the motivations underlying possible relaxation of the fundraising restrictions is the “need to remove unnecessary burdens on broadcasters who aim to serve their communities”. Of course, imposition of a new requirement that such extended fundraising be station-produced or limited only to certain qualifying organizations hardly suggests “removal” of burdens, but maybe that’s just us. And then, there are the reports.

The NPRM suggests that NCE stations might be required to file reports, annually, to let the Commission know, for each fundraiser:

  • the date and time of the fundraiser;
  • the name of the non-profit entity benefited by the fundraiser and whether this entity is a local organization;
  • the specific cause, if any, supported by the fundraiser;
  • the type of fundraising activity;
  • the duration of the fundraiser; and
  • the total funds raised.

And as long as reports might be filed, why not also require that they be placed in the station’s local public inspection file, too? That would, the Commission supposes, “help to ensure that the public has access to information about how NCE broadcasters are serving the public interest and their local communities”. (Don’t worry – the Commission assures us that it doesn’t “believe that filing such reports would be unduly burdensome”.)

And over and above the reports, the Commission suggests that it might be inclined to include, on the license renewal application form, a new certification requirement relative to compliance with third-party fundraising limits.

So much for “removing unnecessary burdens”.

The FCC is itself limited in its ability to regulate in this particular area. The First Amendment of your friendly U.S. Constitution, for example, limits governmental restrictions on speech based on the content of programming and the identity of the speaker. And Section 399B of the Communications Act prohibits a noncommercial station from accepting funds to express the views of any person with respect to any matter of public importance or interest or to support or oppose any candidate for political office. That cuts out fundraising for issue-oriented or political organizations in most states.  (While the U.S. Court of Appeals for the 9th Circuit has struck down this part of the 399B restriction, the FCC says in the NPRM that it plans to honor that decision only in states located in the 9th Circuit, once the Court’s mandate becomes effective.)

On the other hand, Section 399B restricts only programming for which a station receives consideration; it does not stop a station from broadcasting political material as a free public service, as long as the station doesn’t editorialize in its own name. 

Then there’s the Corporation for Public Broadcasting (CPB), which requires CPB-funded stations to devote the substantial majority of their daily program hours to CPB-qualified programming. Such programming is defined as “general audience programming that serves demonstrated community needs of an educational, information, and cultural nature.” Fundraising for third parties will not likely be popular if it threatens a station’s CPB grant. 

So in the end, any relaxation of FCC-imposed limits on third-party fundraising may benefit only religious, student-operated stations, and the handful of community stations that do not receive CPB funding.

The proposed relaxation is not necessarily endorsed by all the stations it would affect. For sure, some NCE stations may be attracted by the public service opportunities the relaxation might provide. But other licensees prefer the present rule, which enables them to turn down requests for fundraising by blaming the FCC’s prohibition, which effectively ties their hands. If the rule is lifted, licensees can probably expect a barrage of such requests, followed by PR headaches (e.g., hard feelings and criticisms) when some (or all) of those requests are rejected. 

And here’s a tip to anybody who might view fundraising as a potentially lucrative revenue opportunity: beware the recent KUSF case, which indicates that NCE stations selling program time are not supposed to be paid more than their expenses.

The NPRM has been published in the Federal Register. If you have something to say in this proceeding, comments are due by July 23, 2012, with reply comments due by August 21.

NCE LMAs: Profit-generating Monetization Not Allowed

Bureau concludes that KUSF(FM) programming arrangement monetized too much; $50K “voluntary contribution” extracted from buyer and seller

Local marketing agreements – a/k/a LMAs or Time Brokerage Agreements or TBAs (among other catchy titles) – have been a common feature of the broadcast landscape for a couple of decades now. The regulatory boundaries relative to LMAs have become reasonably well established, at least as far as commercial stations are concerned.

For noncommercial (NCE) stations, not so much.

But NCE stations are now officially on notice that, when they broker airtime to a third-party programmer, the collection of any fees in excess of “reimbursement of operating expenses” is verboten.   That news comes to us through a Consent Decree (CD) between (a) the University of San Francisco and Classical Public Radio Network, LLC, on the one hand and (b) the Media Bureau, on the other. The CD provides that the Media Bureau will grant the license assignment of NCE Station KUSF(FM), San Francisco, from USF to CPRN – provided that USF and CPRN make a joint “voluntary contribution” to Uncle Sam to the tune of $50,000. 

Why the hefty price tag (which, by way of comparison, is exactly twice the fine issued to Google for thumbing its nose at the Commission)? Because, under the CPRN/USF deal as initially implemented, CPRN was making it worth USF’s while to hand programming time over to CPRN while the assignment application was pending. Oh yeah, and CPRN and USF guessed wrong about how the FCC would feel about that.

The deal presented to the Commission in January, 2011 specified that CPRN would buy KUSF, a mainstay of the NCE scene in San Fran for 35 years, for a cool $3.75M.  Among the various terms and conditions was an LMA of sorts, in this case titled a “Public Service Operating Agreement” (PSOA). The PSOA provided that, while waiting for the FCC’s blessing to become licensee of the station, CPRN would take over all of the airtime of the station.  In return, CPRN would pay to USF a flat monthly fee (initially $5,000, rising to $7,000 per month after a few months) in addition to reimbursement of all operation expenses.  (The expenses specifically covered were: the cost of broadband or other circuits used for delivery and reception of the programming, electrical power to the transmitter site, regulatory fees, insurance rider, and telephone expenses incurred at the transmitter site.)

These terms would be fairly conventional in a commercial transaction. But NCE stations are subject to different rules. Those would be Sections 73.503(c) (for radio) and 73.621(d), for TV, which specify that NCE licensees

may broadcast programs produced by, or at the expense of, or furnished by persons other than the licensee, if no other consideration than the furnishing of the program and the costs incidental to its production and broadcast are received by the licensee. The payment of line charges by another station network, or someone other than the licensee of a noncommercial educational FM broadcast station, or general contributions to the operating costs of a station, shall not be considered as being prohibited by this paragraph.

That language is not a model of clarity or specificity. In an effort to divine the precise metes and bounds of the rule, CPRN and USF apparently combed through the FCC’s records, checking other NCE transactions that (a) included provisions similar to the PSOA and (b) had received FCC approval. Based on that research, CPRN and USF felt that their deal conformed to the rules.

They guessed wrong.

Responding to complainants’ concerns about the deal, the Bureau sent CPRN and USF a letter of inquiry. From the CPRN/USF responses to that letter, the Commission found that the PSOA violated Section 73.503(c). But the CD does not indicate precisely what aspects of the KUSF deal accounted for that violation. Presumably the fees over and above operating expense reimbursements were a problem, but were the separate reimbursements all OK, or were they, too, excessive in some respect? The CD doesn’t say.

In an unusual statement issued in connection with the CD, Media Bureau Chief William Lake said that the rules forbid payments “unless they are limited to reimbursement of operating expenses”. That seems a bit different from the actual language of the applicable rules, so while Lake’s statement may have been intended to be helpful, it doesn’t seem to clarify things much – other, of course, than to make clear that any payments not tied to reimbursement of some sort are impermissible.

On top of that, CPRN and USF were also found to have violated Section 1.17, which prohibits false certifications. In their assignment application, both parties had certified – incorrectly, as it later turned out – that their deal was consistent with FCC rules. In the CD the Bureau did acknowledge that this particular violation was not as serious as it might have been, since the seller and buyer had not tried to hide the terms of the agreement. Indeed, they had filed the agreement with the Commission as part of their application.

What about all those earlier applications that the Commission granted with LMA provisions – you know, the ones that CPRN and USF relied on for their belief that the PSOA would pass muster?  Lake acknowledged that the PSOA was not necessarily dissimilar from a “practice” that “developed in past NCE radio transactions, in apparent violation of the rule, without [the Bureau’s] knowledge”. 

Of course, the Bureau could have known about the specific terms of other NCE transactions that the Bureau had approved, if the Bureau had examined the materials that the parties to those transactions had filed. But the Commission does not typically make it its business to learn the finer points of sale and brokerage contracts, so the fact that similar provisions might have been included in previous deals does not mean that the Commission had approved them, or was even aware of them. (In fact, the PSOA’s violation of this provision may well have gone unnoticed, had the sale of KUSF not been so controversial, attracting press scrutiny and resulting multiple informal objections and petitions to deny.)

The bottom line here was probably best expressed by Lake, who admonished that NCE licensees may not “monetize their licenses by selling program time for a profit.” How the Bureau will identify such improper “monetization” isn’t clear, a fact that Lake tacitly acknowledged by urging any NCE licensee or programmer who might not be certain about the prohibition to contact the Bureau’s staff to discuss the matter in advance.

9th Circuit Opens Noncoms to Political Spots

Court tosses long-time ban on political/issue-oriented spots in NCE band; Prohibition against standard “commercials” left in place.

Just as the political advertising season is about to shift into overdrive, the U.S. Court of Appeals for the Ninth Circuit has opened the competition for candidates’ cash to a universe of broadcasters previously excluded from that potential revenue stream. According to the court, the longstanding prohibition against the sale of paid political advertising by noncommercial educational broadcast stations – a/k/a “NCE” or “public” broadcasters – is unconstitutional.

Since the earliest days of broadcasting, the Communications Act has prohibited noncommercial stations from broadcasting “advertising”. The Act currently defines “advertising” in this context to include any broadcast content, aired in exchange for consideration of any kind, that either:

  1. promotes some for-profit activity; or
  2. expresses the views of any person with respect to any matter of public importance or interest; or
  3. supports or opposes any political candidate.

(Yes, yes, we know that most, if not all, NCE stations do broadcast items that look a lot like standard ads. Those are technically referred to as “enhanced underwriting announcements”. They are theoretically subject to considerably greater constraints that normal “ads” – and the FCC does occasionally fine stations for exceeding the permissible limits.)

The theory underlying the ban on ads is clear (if not entirely convincing to many): if public stations were allowed to accept advertising, so the thinking goes, they’d be inclined to replace niche educational programming with programming designed to attract a much broader audience, or maybe they’d feel pressure to alter the content of their programming to please their advertisers – the goal, in either event, being to attract more advertising dollars. (Note: whether or not that theory is valid is far from clear, but it’s the theory that Congress relied on.)

So how did much of the ban just get tossed?

The story starts a decade ago. In 2002, the FCC fined a San Francisco public station, KMTP-TV, $10,000 for broadcasting numerous prohibited advertisements. KMTP-TV paid the fine, but then sued in federal District Court in California for reimbursement. Its claim: all of the advertising prohibitions are unconstitutional restrictions on the station’s speech. The District Court upheld the prohibitions on advertising, and KMTP-TV appealed to the Ninth Circuit, which released its decision earlier this month.

The Circuit agreed with the FCC that Congress does have a substantial interest in supporting the types of “high quality educational” programming found on NCE stations. (The Court does not address the obvious question of how the term “high quality” programming is defined or who is defining it.) And the Court was also on board with the government’s claim that Congress had enough evidence supporting its general theory that the goals of noncommercial broadcasting would be undermined if advertising were permitted. (That’s the theory that NCE stations would (a) abandon niche educational programming in favor of more mass-market programming and (b) alter the content of their programming to attract advertisers.) To be sure, the evidence wasn’t particularly empirical and much of it dated back to 1981 and earlier – but the Court reasoned that Congress’s judgment is entitled to substantial deference.

Accordingly, the Court upheld the ban on regular advertising.

Political and issue advertising, however, were another story.

In the Court’s words,

neither logic nor evidence supports the notion that public issue and political advertisers are likely to encourage public broadcast stations to dilute the kind of noncommercial programming whose maintenance is the substantial interest that would support the advertising bans.

To illustrate this, the Court focused on two types of programming – public affairs and children’s/family programming – touted by the government as the types of NCE programming that Congress intended to protect. 

As to children’s programming, the Court concluded that allowing political/issue advertising would have minimal effect. That’s because most viewers of such programming (i.e., children) can’t vote, so (according to the Circuit) NCE stations would have no incentive to alter that programming to suit the preferences of a political candidate or “issue group” and thereby attract their advertising dollars.

As to public affairs programming, the Court acknowledged that stations might change the content of such programming to attract political and issue advertising on various sides of important issues. But the Court could find no evidence – either before Congress when it enacted the ban or before the District Court that initially upheld it – that suggested that Congress was, or should have been, worried about that speculative notion. To the contrary, Congress appeared to be concerned exclusively with “commercialism”. Campaign ads and issue ads don’t promote “commercialism” because, in the Court’s view, they “do not encourage viewers to buy commercial goods and services”.

Additionally, the Court was struck by the fact that the discriminatory effect of the advertising ban. The ban permits announcements that promote the goods and services of non-profit companies, but forbids political/issue announcements. Such governmental line-drawing based on the content of the communications at issue raises serious constitutional questions. The FCC was unable to justify to the Court’s satisfaction the content-based distinction drawn by the statutory prohibition.

So what does this all mean? For openers, it means that NCE stations – at least those in the states within the Ninth Circuit – can now sell advertising time to political candidates and groups seeking to address important public issues. That could alter some candidates’ strategies – since NCE stations may provide more direct access to certain audience demographics. It will certainly alter the operations of many NCE stations, which will now be able to market themselves to at least certain limited classes of advertisers.

By the way, (1) what states are in the Ninth Circuit, and (2) why does that matter? 

Answer to Question 1: Alaska, Arizona, California, Guam, Hawaii, Idaho, Montana, Nevada, Oregon, and Washington. 

Answer to Question 2: Because the Ninth Circuit has jurisdiction over only those cases arising in those states, and its decisions thus affect only those states. It is therefore at least conceivable – but not, in our view, likely – that the Commission could take the position that stations located outside of the Ninth Circuit are still subject to the advertising prohibitions. (We think it unlikely that the Commission will go that route because to do so would create, in effect, two separate sets of rules based purely on the accident of geography. It’s hard to imagine that the FCC would be eager to head down that road.)

Those public stations that elect to jump into the political advertising game will have to familiarize themselves with the complex of political ad rules that routinely beleaguer their commercial counterparts. Equal opportunities, lowest unit rates, political file obligations, etc., will presumably all have to be implemented in some fashion, even though the Court’s decision did not address any of those niceties. 

One thing that NCE stations won’t have to worry about: the “reasonable access” provision of the Communications Act. That provision mandates that candidates for federal office are entitled to “reasonable access” to advertising time. The precise extent of “access” that might be deemed “reasonable” has bedeviled the Commission and the courts for years. But the Act expressly exempts NCE stations from that obligation, and the Ninth Circuit’s decision does not alter that exemption.

Where do we go from here? The Commission could fold up its litigation tent and accept the Circuit’s decision, leaving it to Congress to amend the Communications Act to address the decision if Congress sees fit.

Alternatively, the Commission could ask the Ninth Circuit to reconsider its decision. The three-judge panel did include one dissenter, which might give the Commission some hope.  Or it could ask the full Circuit to rehear it en banc. Or it could go for broke and ask the Supremes to take a look. In the meantime, unless the FCC requests and is granted a stay of the effectiveness of the Circuit’s decision, the ban on political/issue ads on NCE stations (at least in the Ninth Circuit) is gone until further notice.

Check back here for updates on how the Commission chooses to proceed.

In closing, we note that KTMP is probably frustrated. In all likelihood, KTMP launched its appeal not with the goal of trashing the ban on political/issue ads, but rather to get rid of the more general ban on commercial advertising which had gotten it into hot water at the FCC. While it obviously came up short on that score, KTMP’s efforts have nonetheless established an important precedent for all NCE stations.

NCE On-Air Fund-Raising For Japan Relief Efforts

FCC announces procedures for waiver requests by noncommercial broadcasters

In our experience, broadcasters respond to catastrophes with incredible humanity, offering help wherever and whenever possible. As the horrific stories and images from earthquake- and tsunami-devastated Japan continue seemingly unabated, broadcast stations may want to undertake fund-raising efforts to support relief efforts. The FCC clearly does not want to do anything to discourage such laudable humanitarian impulses. However, rules are rules – and the Commission’s rules (Sections 73.503(d) for radio and 73.621(e) for TV) generally prohibit noncommercial educational (NCE) broadcasters from engaging in on-air fund-raising activities on behalf of anybody but the station itself.

Not to worry. The Commission has historically waived that prohibition following “disasters of particular uniqueness or magnitude” – Hurricane Katrina, the 2004 Southeast Asia earthquake/tsunami and the 2010 Haiti earthquake come to mind as ready examples. And just to be sure that we all know that the FCC views the Japan earthquake/tsunami to be in the same league, the Commission has issued a public notice laying out the procedures by which NCE licensees may request waivers so that they can engage in fund-raising for relief efforts.

Stations seeking such waivers should prepare an informal request providing the following basic details of their fund-raising activity:

  • the nature of the fund-raising activity;
  • the proposed duration of the activity;
  • the organization(s) to which fund will be donated; and
  • whether the fund-raising activity will be part of the station’s regularly-scheduled pledge drive or fund-raising efforts

The informal request should then be emailed to the FCC.  NCE television licensees should address their requests to Barbara Kreisman ( NCE radio licensees should address their requests to Peter Doyle ( and Michael Wagner ( Those points of contact are also available for any particular questions you might have about such things.

Turn-Of-The-Century NCE Translator Applications Dismissed

The Spring Cleaning bug has hit the folks in the Audio Division. They have unceremoniously dumped out at the curb nearly 300 applications for FM translators on reserved (noncommercial educational) channels that were filed ten or more years ago. The discarded applications – like disco suits or eight-track tapes you might find in some closet or file cabinet you haven’t looked in lately – have been overtaken by intervening trends, most importantly the current fascination for all things LPFM.

Of course, if you happen to be one of the applicants being shown the door, you might wonder how it is exactly that the Commission could invite you to file, then sit on your application for a decade, and then toss it out without so much as a “so sorry”. After all, it took time and money for the applicants – all noncommercial entities, most of them religious – to prepare the applications, and they all presumably had plans to use the proposed stations to bring new service to listeners. The summary dump of their applications seems more than a little harsh.

The applications in question – you can view a complete list here – were filed back in 2000 (a small handful go back a year or two further). They got iced in when the Commission imposed a freeze on NCE-band translator applications in April, 2000, in connection with the transition to the then-“new” NCE comparative process. Because of the freeze, the applications never got accepted or “cut-off”, leaving them pretty much nowhere for a decade.

In the meantime, LPFM managed to plant itself in the regulatory consciousness and gradually metastasize, eventually eclipsing any luster that translators (which operate on the same channels as LPFM) might once have had. And then there was the 2007 open window for full-service FM stations in the NCE band, which distracted the FCC’s staff and sucked up more spectrum that might otherwise have been available for translators. With all that going on, there was no incentive for anybody at the Commission to look in that back closet and think about doing anything with the vintage 2000 applications languishing there.

And now, ten years down the line, the Commission figures that it’s just too late to try to worry about them. So out they go.

Not to worry, though, if you happen to be one of the now-dismissed applicants. The Commission promises that the welcome mat will be out for you to refile the next time that there’s an NCE translator filing window open. When might that be? The staff reminds us that the Commission has said that “[t]he next filing window for a non-tabled aural broadcast service will be for new LPFM stations”. Also, let’s not forget the “numerous primary service licensing initiatives” which the Commission has already committed to complete. Bottom line: “the Bureau anticipates that it will not open a reserved band FM translator window for several years”.

So applicants who had been waiting for ten years will now have to wait at least “several” more, by which time who knows how much of the once-available NCE-FM spectrum will have been dealt off to LPFM applicants. While this may be the path of least resistance for the Commission, and a convenient way for it to balance the various conflicting demands on its time and resources, it’s still unsettling to realize that, while you were standing in line for ten years, nobody bothered to tell you that you were in the wrong queue.

NCE Fund-raising For Haiti Relief Efforts

FCC provides procedures for waiver requests by noncommercial broadcasters

As the horrific stories and images reach the mainland from earthquake-devastated Haiti, broadcast stations may want to undertake fund-raising efforts to support relief efforts. The FCC clearly does not want to do anything to discourage such laudable humanitarian impulses. However, rules are rules – and the Commission’s rules (Sections 73.503(d) for radio and 73.621(e) for TV) generally prohibit noncommercial educational (NCE) broadcasters from engaging in on-air fund-raising activities on behalf of anybody but the station itself.

Not to worry. The Commission has historically waived that prohibition following “disasters of particular uniqueness or magnitude” – things like Hurricanes Andrew and Katrina, the January, 2005 Southeast Asia tsunami and, of course, the September 11, 2001 attacks. And just to be sure that we all know that the FCC views the Haiti earthquake to be in the same league, the Commission has issued a public notice laying out the procedures by which NCE licensees may request waivers so that they can engage in fund-raising for relief efforts.

Stations seeking such waivers should prepare an informal request providing the following basic details of their fund-raising activity:

  • the nature of the fund-raising activity;
  • the proposed duration of the activity;
  • the organization(s) to which fund will be donated; and
  • whether the fund-raising activity will be part of the station’s regularly-scheduled pledge drive or fund-raising efforts

The informal request should then be emailed to the FCC.  NCE television licensees should address their requests to Barbara Kreisman ( and Clay Pendarvis ( NCE radio licensees should address their requests to Peter Doyle ( and Michael Wagner (

Vacant NCE-FM Reserved Channel Window Postponed Two Months

Freeze on proposed changes to reference points of channels up for grabs REMAINS IN EFFECT; Freeze on ALL minor FM mods now set to commence at 11:59 p.m. on February 5, 2010

That was quick. The Commission has announced that it is postponing the upcoming opportunity to file for certain vacant NCE-reserved channels. Just a week after that opportunity was first announced (and reported here), the Commission has pushed back the dates by two months. According to a public notice released on October 23, the filing window will now open up on February 19, 2010, and shut down on February 26, 2010.

When the filing opportunity was first announced, the Commission also simultaneously imposed a freeze on any applications proposing to modify the reference coordinates of any of the 67 allotments available for filing during the upcoming window. That freeze, which started on October 16, is still in place notwithstanding the postponement, and will remain in place until the day after the close of the extended filing window. You can read more about that freeze here.

A separate freeze – on any commercial or noncommercial FM minor mod applications – was also originally announced to go into effect on November 25 and extend until the close of the window. That separate freeze has also been postponed: now that freeze on all minor mod FM applications will commence at 11:59 p.m. on February 5, 2010. It will continue in effect until the close of the window.

The postponement was sought by a number of NCE broadcast groups and their supporters, who argued that the two-month ramp-up time provided in the first place would be inadequate for many prospective NCE applicants. Reflecting what appears to be an acute sensitivity to such arguments (or, possibly to such supplicants), the Media Bureau granted their request less than 24 hours after that request had been submitted.

We can only hope that this establishes a “same day service” standard which will be available to one and all who seek accommodations from the Commission.

Brrrrrrr - The Chill Is On

FCC announces immediate freeze on certain FM allotment proposals, eventual freeze on ALL FM applications in light of upcoming December filing window

With the announcement of an upcoming open window for certain FM allotments, the Commission has frozen, effective immediately (i.e., as of October 16, 2009), (a) applications proposing to modify the reference coordinates of any of the 67 allotments available for application in the upcoming window, or (b) petitions and counterproposals that propose a change in channel, class, community, or reference coordinates for any of those 67 allotments.  (Curious about precisely which allotments are in play here?  Click here for the list.) 

This freeze will remain in effect until the day after the close of the window. The window is currently set to close on December 18, which would mean that the freeze should be lifted on December 19, barring any unforeseen developments.

The Commission also froze the filing of any commercial or noncommercial minor mod applications after 11:59 p.m. on November 25, 2009 until the close of the window

These freezes are standard operating procedure when filing windows are about to be opened. The goal is to avoid the creation of any conflicts (unforeseeable or otherwise) that could muck up the filing process.

For more information on the upcoming window opportunity itself, see our relating post here, or the underlying FCC public notice here.

FCC Announces Window For Vacant NCE-Reserved Channels

Applications for NCE stations on 67 allotments in the commercial band can be filed between December 11-18

If you’re interested in filing for a new non-commercial FM construction permit specifying a channel that would otherwise be restricted for commercial use, here’s your chance. The Commission has announced that, between December 11-18, 2009, it will open a filing window opportunity for certain vacant FM allotments. The allotments being made available – 67 in all – are in the commercial band; however, at the request of some would-be applicants (who were able to satisfy relatively complex Commission policies governing such things), these channels were reserved for NCE use, so commercial applicants need not apply.

The FCC’s public notice provides general directions for those interested in applying. It solicitously cautions applicants about some of the vagaries and vexations of the CDBS filing system which must be used for the application process. (Sample advice: “[I]t is important that the applicant shares its CDBS account passwords with only those individuals who are authorized to view and/or modify proposals in progress.”) It warns that “redlight” considerations could prevent an applicant from getting in the door. It encourages all applicants to make sure that their applications really have been submitted (hint: CDBS provides a “confirmation” screen immediately after a successful submission.)  

The notice also anticipates that mutually exclusive applications will be filed. No big surprise there. It makes clear that, in the event that multiple applications are filed for a single channel, the standard NCE comparative analysis will be utilized.  (If you’re unfamiliar with that analysis, it’s set out in the FCC’s rules here.)

Apropos of comparative considerations, each applicant’s positive comparative attributes will be frozen as of the close of the window.  On the other hand, post-window changes that detract from an applicant’s comparative position will be considered, to the applicant’s detriment.  So an applicant’s comparative qualifications cannot be improved – but can be reduced – by changes after the window slams shut. To the extent that an applicant does claim comparative “points”, it will have to submit documentation to support such claims – and the Commission “recommends” that such documentation be included as exhibits to the application.

One narrow exception to the no-comparative-improvements rule: in some limited instances, an applicant which holds certain other interests – say, an LPFM or a fill-in translator or a same-area Class D station – may avoid the adverse comparative impact of those holdings by committing, in its application prior to the close of the window, to divest them. In other words, the divestiture does not have to occur prior to the close of the window, but the commitment to divest must be made by then. Check out the public notice for further details.

The Commission’s notice also underscores a technical peculiarity which must be addressed in each application. The channels up for grabs are in the portion of the FM band ordinarily used for commercial stations. They were reserved for non-commercial operation pursuant to a policy adopted six years ago, a policy designed to accommodate situations in which no NCE channels were available for use in a given geographical area. (You can read a bit about the background of that policy here.)  Under that policy, certain showings had to be made relative to the channel before the FCC would reserve it for NCE use. That being the case, the Commission wants to be sure that the conditions underlying the reservation remain applicable.

Three such conditions apply here. A commercial channel may be reserved for non-commercial use if it is shown that: (a) no NCE channel could be used without causing prohibited interference to TV Channel 6 stations; (b) no NCE channel could be used without causing prohibited interference to foreign broadcast stations; or (c) no NCE channel is available and the proposed reserved channel would “would provide a first and/or second NCE radio service to at least ten percent of the population within the 1 mV/m contour of its proposed station”. If a channel was reserved pursuant to (c), NCE applicants for that channel must demonstrate, in their applications, that their proposals will satisfy that condition – i.e., first/second NCE service to at least ten percent of the 1 mV/m population, AND that service area population must be at least 2,000 persons.

The Commission has helpfully identified the channels which were reserved on the basis of the “first/second NCE service” criterion. Those channels are marked with double-asterisks on the channel list issued with the public notice. Approximately 90% of the 67 listed channels are so marked.

The public notice also alerts prospective applicants that they are expected to have both (a) “reasonable assurance” of the availability of their proposed antenna sites and (b) sufficient financial wherewithal (liquid assets on hand or otherwise committed) to build and operate the station for three months. For tie-breaker purposes, they must also list all applications they are filing in the window (including the subject application itself) as well as any application filed prior to the window which has not been granted, dismissed or denied prior to the opening of the window. (Requests filed on Form 175 to participate in channel auctions need not be included.)

There is no cap on the number of applications which may be filed during the window but applicants should bear in mind that, if it comes down to a tie-breaker, the applicant with the fewest pending new/major change applications in the same service should prevail.

In view of the fact that the Commission’s staff has still not completed the processing of all the applications that were filed in the 2003 FM translator window or the 2007 NCE window (which was limited to channels in the NCE end of the band), it’s not likely that we’ll be seeing too many filing opportunities for new NCE stations in the foreseeable future. For that reason alone a considerable turn-out for the December window may be expected.

FCC Opens Amendment Window for a Handful of NCE Applications . . . At Last

In a proceeding that has moved at glacial speed, even by FCC standards, the Commission has opened a window to allow noncommercial applicants that are mutually exclusive with certain commercial applicants for FM, FM translator, TV and AM stations, to amend their applications to specify commercial operations by October 30, 2009. Failure to amend by that date will result in the dismissal of the NCE applications. With two exceptions, relating to stations formerly licensed to Michael Rice, the applications subject to amendment all pre-date the Commission’s first broadcast auction in 1999 – the most recently filed of those applications date back to 1997 (you remember – that was the year the Spice Girls rocked us all with Wannabe). The Commission has thoughtfully provided lists of the MX groups – including 13 FM stations, three FM translators, one TV and two AM’s – here and here.

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.

FCC to NCE's: Ixnay on the "Cold Refreshing Beer"

The Commission has added to the lexicon of things you can’t say on the radio, if you’re a noncommercial broadcaster and you’re referring to people or companies who have provided you with underwriting support. We last alerted our readers to the issue of prohibited “advertisements” in a blog posted in March. Readers may recall that one of the terms declared verboten by the Commission then was “world famous pepperoni rolls”. This time around, the target is nothing less than (cue ominous music) . . . “cold refreshing beer”.

In a decision directed against a community college station in Auburn, New York, the Enforcement Bureau has declared that the following announcements were Too Promotional:

  • A cable company blurb which referred to “targeted advertising through specialized channels such as ESPN”
  • An announcement for a local bank which stated: “Meets all your banking needs. Visit one of our four branches in the Finger Lakes. Banking the old fashioned way.”
  • Reference to the Bank of America, which was said to “[p]rovide[ ] flexible financing for policemen, firemen, nurses, and others in the community that serve it so well."
  • And last but not least, an announcement which described Miller Beer as “cold refreshing beer”.

According to the Bureau, the references to the cable company’s “targeted advertising” and “specialized channels” “distinguish [the cable company] from competitors and seek to promote its services”. Ditto for the bank’s claims of “meet[ing] all your banking needs” and “banking the old fashioned way” – in the Bureau’s eyes, those terms alone are “comparative and qualitative” (not to mention “visit one of our four branches”, which the Bureau concluded was an impermissible “call to action”). And double ditto for Bank of America’s reference to “flexible financing”, which “impermissibly seeks to induce patronage by encouraging listeners to explore the bank's financing options”, according to the Bureau.

And “cold refreshing beer”? Well, that “promote[s] that product through use of qualitative terms”, as the Bureau sees it.

Total cost of the resulting fine? A cold, refreshing $2,500, knocked back to $2,000 because the licensee has previously kept its nose clean, according to the Commission’s records.

As we observed last March, there is considerable latitude between the obviously promotional and the permissibly descriptive. While we object as much as the next guy to hearing (or seeing) “commercials” on noncommercial stations, the mere use of accurate, descriptive terminology – to our minds, at least – does not ordinarily offend our sensibilities. And it’s hard to imagine anything more accurate or neutrally descriptive than “cold refreshing beer”. After all, is it even beer if it’s not cold and refreshing? (When was the last time you were able to order up a warm, unsatisfying beer anywhere?)

And as soon as we get ourselves appointed to run the Enforcement Bureau, our views might count for something. Until then, though, they don’t – so we reiterate our suggestion from last March that all NCE licensees might want to take a closer look at their underwriting scripts and weed out any quasi-promotional language that may have snuck in over time. And given the most recent Bureau decisions in this area, it would be best to calibrate your commercial-o-meter to “hyper-sensitive”, just to be on the safe side.

Creativity Crushed

Media Bureau puts kibosh on NCE applications with Channel 6 contingencies

Sometimes it doesn’t pay to get creative, especially where the FCC’s rules are concerned.  This was apparent in an April 1 Public Notice which supposedly “provided guidance” to noncommercial educational (NCE) FM stations with regard to television Channel 6 protection requirements.  Significantly, the Notice was issued by the Media Bureau, not the Audio Division.

Because NCE FM channels are close neighbors to Channel 6 on the spectrum, NCE FM stations (and related applications) must protect nearby Channel 6 stations.  A couple of very narrow exceptions are available, one of which involves submission of an unconditional agreement between the NCE and the Channel 6 station in which the latter “concur[s] with the proposed NCE facilities.” 

The Channel 6 protection requirement cropped up big time in the run-up to the October, 2007, NCE FM filing window.  Channel 6 problems would ordinarily have prevented the filing of many applications.  But several NCE applicants came up with a work-around.  They noted first that, after the DTV transition (then scheduled for February 17, 2009), a lot of Channel 6 operations would simply disappear, as the stations in question abandon their analog Channel 6 facilities for digital facilities elsewhere on the TV band.  The would-be applicants then calculated, correctly, that the NCE FM permits they were filing for wouldn’t be granted for at least a year or two – which means that their three-year construction periods would run well past the DTV transition. 

So, they reasoned, if there would be no Channel 6 operation to worry about when construction time actually rolls around, shouldn’t they be able to ignore Channel 6 at the application stage?

Thinking along these lines, a number of applicants either sought waivers of the protection rules or entered into, and submitted, contingent agreements with the nearby Channel 6 station.  (The contingent agreements reflected the Channel 6 licensee’s consent to the filing of the NCE FM application, generally with the proviso that the FM wouldn’t crank up – and thereby cause interference – until the TV station had vacated the Channel 6 premises, thereby eliminating the possibility of interference entirely.)

As far as we can tell, neither the full Commission nor the Bureau nor the Audio Division had opined as to the acceptability of that approach prior to the October, 2007, window.  Since then the Division has indicated in one or two decisions that it was not inclined to accept such applications.  But the Bureau’s April 1, 2009 Notice – issued a mere 18 months after the applications were filed – conclusively slams the door by barring such creative solutions.  The Notice states unequivocally that the Bureau will dismiss any NCE application that conflicts with the interference rules and fails to include either: (a) a showing that no more than 3,000 people would be subject to the predicted interference; or (b) an “unconditional consent letter” from the Channel 6 licensee. To make itself perfectly clear, the Notice warns that that consent “cannot contain any contingencies, conditions, qualifications or restrictions.”  (We get it; we really do.) 

Applications filed in the October, 2007, window are subject to the terms of the Notice, which means that any such application that doesn’t satisfy the Notice is toast, since the Bureau emphasized that any attempt to revive the application through an amendment or a petition for reconsideration (even after the Channel 6 station goes away)  will be unceremoniously rejected.  Further, with regard to currently mutually-exclusive NCE applications for new stations, the Bureau notes it will dismiss the applications of NCE FM “tentative selectees” who have attempted the end run described above. 

The Notice does magnanimously indicate that, after the June 12 DTV transition, the Bureau will open a filing window for NCE stations to permit them to take advantage of the Channel 6 migration.  (The Notice refers only to "stations", which suggests that the window may be limited to licensees seeking to modify their facilities -- that is, the window would appear not to be available for new applications.  Time will tell.)  But applicants for minor changes who attempt to do so before the window opens will  in any event be shown the door.  And, oh by the way, the Commission will start a rulemaking to evaluate the “continued viability” of the Channel 6 protection requirements after completion of the digital TV changeover.

While we appreciate the efficient processing considerations that underlie the Bureau’s approach, that approach may elevate form over substance in view of the imminent departure of most full-power Channel 6 stations.

LPFM Stuck With $20K Fine for "Advertisements"

Time for NCE’s to review their underwriter announcements?

The Enforcement Bureau has come down hard – very hard – on a low power FM station for broadcasting thousands of prohibited advertisements over the course of some 14 months. Total fine specified in the Notice of Apparent Liability: a cool $20,000. Ouch! And this is an 11-watt (yes, when they say “low power”, they really mean it) station we’re talking about. Double Ouch!

The Bureau’s decision highlights the perennial problem presented by the limits on noncommercial educational (NCE) licensees. (By definition LPFM stations are NCE.) NCE licensees are prohibited from broadcasting any promotional announcements on behalf of for-profit entities at any time in exchange (in whole or in part) for any consideration of any kind. BUT they MAY broadcast announcements which identify and acknowledge non-profit and/or for-profit entities (referred to by the cognoscenti as "underwriters") who contribute to the station’s operations, monetarily or otherwise. 

The trick is telling the prohibited promo from the acceptable acknowledgement.

The Commission “affords latitude to the judgments of licensees” in this area: if the licensee exercises reasonable, good faith judgment in this area, the FCC says it won’t second-guess that judgment. Which is all well and good, but danger still lurks in these waters because the Commission has provided only very broad guidelines with which to navigate them.

The Commission has posted on its website a couple of general discussions of its policies in this area. These include a 1992 reprint of a 1986 policy statement and a set of comments presented by Kenneth Scheibel, the Commission’s resident guru on such things, back in 1999. The policies can be summarized like this: underwriter announcements may identify the for-profit contributor and the goods or services which it offers, but those announcements may not “promote” those goods or services.

A prohibited “promotion” usually involves one or more of the following elements:

  • Price information – Underwriter announcements may not contain any information about pricing. Particular prices of any goods or services, other indications of savings or monetary value associated with the goods or service, special discount offers that might be available – they’re all to be avoided.
  • “Calls to action” – Language which encourages the audience to patronize the underwriter is also verboten. “Stop by our showroom” or “Try our product the next time you’re in the market” or “Call us today for more information” – steer clear of them all.
  • Special inducements – This tends to bridge the first two elements, above. Think things like “We’re giving a special bonus to customers who sign up this week” or “Free samples to the first 50 callers” or “Pre-holiday discounts now in effect”.
  • Qualitative or promotional language – This is where things tend to get fuzzy. You’re supposed to avoid language which appears to promote the qualitative desirability of the underwriter’s goods or services – for instance, “comparative” references stating or implying that the underwriter’s goods/services are somehow preferable (“the best plumbers in town” or “cheaper than everybody else” or “largest service department”). The prohibition also extends to language which goes beyond the mere identification of the underwriter’s goods or services. For example, you could say that an underwriter “provides a full line of widget products”, but not that that underwriter “provides a full line of widget products in a rainbow of beautiful colors and wonderful textures guaranteed to delight the eye and stay within your budget”.

The trouble is that the there is a lot of room between the obviously promotional and the narrowly identifying. And let’s be frank here: underwriters usually want, and probably expect, more than a “name/rank/serial number” announcement in return for their contribution. So the NCE licensee ends up pulled between the need to comply with the FCC’s less than specific limitations and the underwriter’s preference for at least a little bang for its buck.

The recent LPFM decision suggests that the NCE licensee’s ability to cater to that preference may be shrinking. The Enforcement Bureau identified the following terms as prohibited:

  • With respect to restaurants: “a unique eatery” whose food is “made with only the freshest ingredients”; “their world-famous pepperoni rolls”.
  • With respect to a copy center: “your one-stop shop for black and white [and] color copies. You can stop by one of our two locations.”
  • An automotive service center: the owner “takes pride in their honest and reliable service”.

While we understand that these could all be read as “promotional” in some sense, each of these descriptives seems, well, descriptive. They certainly don’t go overboard and could reasonably have been deemed to be within the “latitude” that the FCC says it accords to NCE licensees.

Curiously, in singling out these particular portions of the various announcements, the Commission made no mention of several fairly clear price references elsewhere in the same announcements: “at affordable prices”, “she wasn’t charged an arm and a leg”, “park for free”, “free local shuttle service”. Since price information is forbidden, one might have thought that the Commission would be concerned about such references – but if it was, you can’t tell it from the decision. In other words, the Commission overlooked some seemingly blatant problematic language and instead whacked the licensee for language which appears – to us, at least – as much closer to, if not comfortably inside, the permissible range.

Meanwhile, the decision also includes the observation that “many” of the announcements in question “appear to exceed thirty seconds in length”. Of course – as the Bureau expressly acknowledges – there is no limit on the length of underwriting announcements. But that doesn’t stop the Bureau from raising its regulatory eyebrow for all to see: the Commission “has found that the longer the announcements, the more likely they are to contain material, as here, that is inconsistent with the ‘identification only’ purpose of such announcements.” So even though the Commission has not imposed any length limits on such announcements, it clearly has limits in mind – um, let’s say 30 seconds -- and it doesn’t seem shy about trying to get that message across.

This case may be an aberration, and may not signal a tightening of standards on underwriting announcements.  But at a minimum it should encourage all NCE licensees to take a closer look at their underwriting scripts and to weed out any quasi-promotional language that may have snuck in over time. This may require some uncomfortable conversations with underwriters unhappy that their announcements are being neutered, but that could be the cost of compliance.

Careful script review would be especially prudent in view of the current economic environment. Commercial broadcasters historically have often bridled at NCE underwriting announcements that tended to sound like real spots. After all, one station’s “underwriting contribution” is another station’s “advertising revenue”. Beyond a fair amount of grousing, though, the commercial folks have not seemed particularly enthusiastic about trying to call in the Federales to stop improper underwriting. But as the number of available advertising dollars shrinks, there may be more incentive for some commercial broadcasters to file complaints with the Commission in an effort to re-direct dollars from the NCE’s to their own bottom-lines. As Sergeant Esterhaus used to admonish the Hill Street Blues squad, “Let’s be careful out there.”

Public Radio Webcasters: Have We Got a Deal for You!

Attention all broadcasters: 

Are you a noncommercial broadcaster currently engaged in webcasting?

Are you one of the more than 450 public radio webcasters that is:

  • A CPB supported station;
  • An NPR member;
  • A National Federation of Community Broadcasters Member; or
  • Part of American Public Media, the Public Radio Exchange or Public Radio International? 

If the answer to both of these questions is "YES!", you'll want to read more about an exciting new offer available to you.

SoundExchange and the Corporation for Public Broadcasting have announced that a settlement has been reached that will alter the way in which these stations pay royalties and report webcasting performances through 2010. 

The current royalty rates have been the subject of significant discussion in the broadcasting community, including  several  informative  articles  in  this  very blog.  The sharp increase in rates for the period 2006-2010 was especially feared by noncommercial stations with a large web audience, as those noncommercial stations would pay at commercial rates anytime their internet listenership exceeded 159,140 "aggregate tuning hours" in a given month, as opposed to the flat fee these stations (and small webcasters) had paid prior to the institution of new rates.

Pursuant to the Webcaster Settlement Act of 2008, this settlement agreement can go into effect immediately, with the following applicable terms: 

  • Any eligible radio station which chooses to participate will not have to make any further royalty payments until December 31, 2010, as CPB will make a single, up front payment of $ 1.85 million to SoundExchange on behalf of public radio staitons. 
  • SoundExchange will also create a consolidated playlist reporting system for use by all stations which choose to become a part of this program; those stations will be responsible for providing playlist information to CPB.
  • Stations wishing to participate must register their intent with CPB on a designted website; CPB will provide details regarding that registration website in the near future.
  • This agreement does not affect the "sound performance complement" portion of the statutory license (the restrictions on the number of songs that can be played from a certain CD or by a certain artist within a given time frame, the length of time for which a program can be archived, etc), meaning even participating stations must follow those rules.
  • As a condition of the settlement, NPR will withdraw its appeal of the Copyright Royalty Board decision (we see this as an indication that more settlement discussions continue between SoundExchange and those segments of the webcasting community that are part of the pending court appeal).

No station is required to participate in this settlement. Thus, a station that is certain it will never exceed the aggregate tuning hour limitation in any given month may simply decide to ride out the next two years until the new rates are determined for 2011 and beyond in a proceeding that will commence in the near future (more on that soon).  Still, if you believe you may be eligible and wish to participate, keep an eye out for further communications from CPB or contact a Fletcher, Heald & Hildreth attorney.

FCC to Open Amendment Window for a Handful of NCE Applications

A lucky few, very patient, noncommercial educational (NCE) applicants got an early Christmas present this year: the Commission has reconsidered its Grinch-like 2003 decision to summarily dismiss their applications. But they’re not out of the woods yet.

Historically, NCE applicants could file applications for new stations on commercial (a/k/a “non-reserved”) channels.  If mutually exclusive (MX) commercial applicants also filed, the competing applicants would have to duke it out in a hearing.  But when the Commission moved to an auction process for doling out new CP’s, things got complicated.  Congress had said that NCE applicants would not be subject to auctions, which meant that “mixed” application groups – i.e., MX situations involving both commercial and NCE applicants – could not be resolved through auction.  That left a number of MX groups – including applications filed more than 10 years ago – in limbo, as the Commission had no alternate way of picking a winning applicant from a universe of both commercial and NCE applicants.  In 2003, the Commission decided that the way to move things along in those proceedings was simply to throw out the NCE applicants, thereby clearing the way for the remaining commercial contenders to slug it out in auctions.

Not surprisingly, a number of the tossed-out NCE folks asked the Commission to give this another think.  And after five (count ‘em, five) years of re-thinking, the Commission has now decided that the NCE applicants deserve a break.  Accordingly, the Media Bureau staff will be announcing, in the near future, a window period during which the NCE applicants in the 19 or so mixed groups will be given a one-time-only chance to amend their applications “for the sole purpose of applying for a commercial station.”  This means that NCE applicants in the affected groups who wish to proceed will have to move forward as if they were commercial applicants – which means that they will have to participate in an auction. 

In its decision the Commission did not identify the particular MX groups, although it did say that the 19 or so groups include 13 FM’s, four TV’s and two FM translators.  (In order to be included in those groups, the affected NCE applications must have been both filed, and MX with a commercial application, as of April 10, 2003.)   Keep an eye out for the Bureau’s public notice of the opening of the window if you think that you may be one of the lucky ones.

NCE-FM Fined $9K for Families and Ice Cream

The FCC is on the prowl again, this time striking at a station for going over the line with "underwriting" announcements before it gave up the noncommercial ship and switched to commercial status.  And the attack was on the sacred national treasure -- Tastee Freeze ice cream.

You will recall that noncommercial stations may acknowledge funding but may not use qualitative terms or suggest that listeners should make a purchase.

The announcements on this station (WCVZ, South Zanesville, Ohio) said that Tastee Freez products are "tastefully decorated" -- whoops, that says they are of good quality -- and they may be suitable for "a special occasion" -- whoops, that's telling you to buy some if you're having a party.

The friendly neighborhood realtor also caused heartburn with announcements that "we are about family," and "we love selling real estate" -- whoops, that says they are nice people, which is not allowed.

The FCC did back down in one situation, where a vendor's products were described as "creative learning materials."   The FCC left that one alone.

Don't count on any let-up in the FCC's enforcement efforts in the underwriting area.  The new decision included a bill to the station for $9,000 to help fund the FCC's budget.

Progress Seen On NCE Permit Front

The Commission has released a public notice identifying 263 groups each consisting of four or fewer mutually exclusive applications for noncommercial educational (NCE) FM permits filed during the 10-day window in October, 2007.

So the good news is that we are now - five months after the close of the window - finally starting to see some movement on those MX applications.

he bad news is that the FCC reports that it received approximately 3,600 applications in all during the window, and only a fraction of those are included in list released with the recent public notice.  That means that there are still a very considerable number of MX applications (in MX groups of five or more conflicting applications) still to be plowed through.  But at least the process has started.  The Commission indicated that the staff will be working its way through these remaining MX groups and will be periodically releasing identifying more of those groups.

If anyone thinks that any application has been mistakenly included in the list which has been released, or mistakenly excluded from that list, that should be brought to the FCC's attention no later than April 7 (i.e., within 30 days of the March 6 release of the public notice).

The Commission also indicated that it would start its comparative analysis of the listed applications 30 days after the public notice.  If any competing applicants are negotiating settlements, or if any are willing to share time on a facility, then they should so notify the Commission within the next 30 days.

Expedited Settlement Opportunity for NCE FM Applicants Available Until January 7, 2008

The FCC has announced that applicants who filed during the recent noncommercial educational (NCE) FM filing window may settle with mutually exclusive (MX) applicants and receive expedited processing of their proposals as long as the settlement agreements and any related technical amendments are filed by January 7, 2008. (Of course, as the Commission's public notice acknowledges, mutually exclusive applicants may settle at any time - not just within this prescribed window - but the FCC has indicated that settlements filed by January 7 will receive expedited processing.)

In order to take advantage of this window opportunity, applicants may resolve technical mutual exclusivity by one of two methods: (a) settlement or (b) technical amendment.

A settlement must propose the grant of at least one technically acceptable application with an MX group and must not create any new MX conflicts. All settlements are subject to reimbursement restrictions - that is, neither the applicant nor any of its principals may received (or be promised) consideration in excess of the legitimate and prudent expenses incurred in the preparation, filing, prosecution and settling of the application.

Technical amendments must resolve all conflicts between at least one applicant and all other applications filed in the window. Only "minor" engineering amendments will be accepted. Such amendments would include specification of an adjacent channel, a new transmitter site, lower power, and the like.

A copy of the Commission's announcement - which specifies a number of filing requirements associated with the submission of settlements - may be found here.

According to the public notice, all applications filed during the October, 2007 window are being made publicly available as of November 8. However, a public notice identifying the various MX groups of applications will not be released until after the close of the settlement window. In other words, it's up to the applicants to determine any and all pending MX proposals for settlement purposes.

FCC to NCE Applicants: Ten's the Limit

As we predicted here just a month ago, the FCC has adopted a limit on the number of applications which any party may file for new stations in the NCE FM window which is slated to open on October 12 and close on October 19. The limit is TEN - count 'em, TEN - applications for new stations. The FCC's public notice announcing this decision may be found here.

This means that any party, be that party an individual, corporation, partnership, or whatever, may hold an attributable interest in no more than a total of ten applications for new stations to be filed during the window.

If the FCC determines that a party happens to have such interests in more than ten, then only the first ten (based on file numbers, which reflect the order in which applications are filed) will be processed; the rest will be summarily dumped by the Commission.

Note that the limit applies only to applications for new stations filed during the October, 2007 window. Major mod applications (which may also be filed during the window) do NOT count toward the limit. Similarly, any already pending application which was not filed during the October, 2007 window does NOT count toward the limit.

As a general matter in the FCC's eyes, a party has an "attributable interest" in an application if the party is the applicant, or an officer, director or 5% or greater owner of the applicant. Narrow exceptions exist for certain "limited partners" or members of "limited liability companies" - but if an applicant hopes to take advantage of those exceptions, special care should be taken and the fine print of the FCC's rules should be consulted.

Complicating matters further, interests may be attributed indirectly. F'rinstance, let's say A owns 10% of company X, which owns 60% of company Y, which owns 25% of an applicant. In cases like that, the FCC applies a multiplier: thus, X's interest in the applicant would be a respectable - and attributable - 25% (i.e., the same as Y's interest because X's interest in Y exceeds 50%), while A's interest in the applicant would be a non-attributable 2.5% (i.e., 0.1 x 0.25).

FCC Proposes Caps for October NCE Filing Window

Bureau issues instructions, guidelines for window filers

In August 9, two items relating to the upcoming filing window for new and major change NCE authorizations were issued.  In a Notice of Proposed Rule Making, the Commission has proposed capping at 10 the number of applications any applicant will be able to file.  The comment and reply comment deadlines, will be established once the NPRM is published in the Federal Register, are short.   Meanwhile, the Bureau issued a public notice setting out the procedures that would apply to window filers, and also providing helpful information concerning the manner in which the Bureau expects to implement its noncommercial comparative analysis.

The NPRM can be found at, and the public notice can be found at

 The possible need for a cap on applications arises from a number of factors, including: (a) the lack of any filing fee for new NCE permits; (b) the lack of any ownership limits in the NCE band; (c) the fact that, because of a longstanding freeze, no one has been able to file for such permits for more than seven years; and (d) full-service NCE authorizations have considerable value in the marketplace.  Another significant factor is the Commission's experience in 2003, when it opened a window for new FM translator applications.  No cap was imposed during that window, and more than 13,000 applications rolled in the door - by some estimates more five or six times more than the FCC had originally anticipated.  To avoid a similar avalanche of applications - and the significant disruptions that it can cause - the Commission has proposed the following limit:

A party to an application filed in the NCE FM filing window may hold attributable interests in no more than a total of ten applications filed in the window. If it is determined that any party to an application has an attributable interest in more than ten applications, the Bureau will retain the ten applications that were filed first - based on application file number - and dismiss all other applications.  Major modification applications will not count toward the limit.  Pending new and major change applications filed under former licensing procedures also will not count toward the limit.

There is an extremely short opportunity to file comments and replies: 15 days and 25 days, respectively, from the date the NPRM is published in the Federal Register.  Check out the NPRM for the nitty-gritty details governing the filing of comments, or contact us.

The Bureau's public notice does not appear to contain any surprises, but it does put everyone on notice that a freeze on all minor change applications (and amendments thereto) in both the NCE band and Channels 221, 222 and 223 of the commercial band (because of their proximity to, and potential RF impact on, the upper NCE channels) will commence on September 8, 2007 and continue until the close of the window (which is currently set for October 19).