FCC adopts process to assure that Native American tribes get first dibs on commercial FM channels allotted pursuant to Tribal Priorities
For nearly three years the Commission has been working to develop mechanisms to promote new radio stations serving Native Americans. The process has been gradual, to say the least. Starting in 2009 with a proposal to create a Section 307(b) priority for Native Americans, the Commission has taken a series of steps looking to facilitate the entry of “Tribes” (a collective term used by the FCC to refer to federally-recognized Native American Tribes and Alaska Native Villages) into the ranks of broadcast owners.
In the closing days of 2011 the Commission took one more step in that process by creating a short-cut available to Tribes seeking new commercial FM stations primarily serving Tribal Lands. The new approach – which might also create opportunities for non-Tribal entrepreneurs willing to work with Tribal applicants in certain capacities – is designed to assure Tribal applicants the first opportunity to apply for such stations, free from competition from non-Tribal applicants. But the path blazed by the Commission imposes its own considerable set of hurdles.
The short-cut was necessitated by the fact that the allotment process for commercial FM channels is different from the process for allotting AM or noncommercial FM channels. For AMs and noncom FMs, a party who identifies the availability of a channel can get a lock on the channel simply by filing an application for it. In the case of commercial FM channels, on the other hand, the first step in the process merely allots the channel; after that, the channel is made available to the highest bidder at an auction, regardless of whether that highest bidder is a Tribe.
And there’s the problem.
If the goal is to assure that Tribes get first dibs on channels serving Tribal members, the Commission had to figure out how to keep that particular class of FM channel off the auction block long enough to give Tribes first crack. (To be clear, that “particular class” of channels includes channels allotted according to the “Tribal Priority” adopted in 2010. Fuzzy on the details of the “Tribal Priority”? Check out our 2010 post for background.)
Here’s what the Commission has come up with:
After a Tribal Allotment – i.e., a channel allotted pursuant to a Tribal Priority – is made, the FCC will open a Threshold Qualifications (TQ) Window. During the TQ Window, any Tribe or Tribally-controlled entity can apply for the allotment. The applicant would have to satisfy the Tribal Priority factors underlying that particular Tribal Allotment. The relevant factors are numerous (stick with me, this gets a little complicated):
- The applicant is either a federally recognized Tribe or Tribal consortium, or an entity owned or controlled 51% or more by a Tribe or Tribes.
- At least a portion of Tribal lands within the proposed city-grade (70 dBu) contour must be those of the Tribe or Tribes holding at least 51% ownership or control of the applicant.
- At least 50% of the area within the proposed city-grade contour is Tribal Land of the applicant Tribe or, alternatively, the city-grade contour (a) covers 50% or more the applicant’s Tribal Lands, (b) serves at least 2,000 people living on Tribal Lands, and (c) the population on Tribal Lands within the proposed 60 dBu (yes, the 60 dBu) contour constitutes at least 50% of the total population covered.
- The proposed station’s city-grade contour does not cover 50% or more of the Tribal Lands of a Tribe that is not a party to the application.
- The proposed community of license is located on Tribal Lands.
- The proposed station constitutes a first or second reception service or a first local Tribe-owned commercial station at the proposed community of license.
Careful readers will have noted that those criteria would exclude any Tribe that lacks Tribal Lands – and there are a significant number of Tribes in that position. No problem: the Commission will entertain waivers of the Tribal Lands coverage requirements if a particular geographical portion of the station’s proposed coverage area is identified with a Tribe that is a party to the application.
If only one acceptable application is filed during the TQ Window, that applicant will get the station. If two or more acceptable applications are filed, the Commission will establish a period during which the applicants may negotiate a settlement or a merger. (Caution: Engineering settlements that would result in more than one application being granted won’t be allowed.)
If no settlement or merger is reached, the allotment will be auctioned, but only those applicants accepted during the TQ Window and the original proponent of the Tribal Allotment will be allowed to bid. The winner will need to file a Form 301 or, in the case of the original proponent, go forward with the Form 301 it filed with its allotment proposal.
In the event no qualifying party files during the TQ Window and the Tribal Allotment proponent asks that its pending Form 301 not be immediately processed, the Tribal Allotment will be set for auction. But the first time that allotment is offered at auction, only applicants meeting the Tribal Priority criteria for the allotment will be allowed to bid.
If no qualifying party bids on the Tribal Allotment in that first auction, at the next auction in which that allotment is offered, any applicant – whether or not a Tribe or Tribal entity – may bid.
Any license issued for a Tribal Allotment – whether through grant of a singleton application or following an auction – will be subject to a holding period. For four years after the station goes on the air, it may not be assigned or transferred unless the party that would get the station also could have qualified for the Tribal Priority under which this particular Tribal Allotment was awarded.
Interestingly, the newly adopted process will allow non-Tribal parties to partner with qualifying Tribes to go after new FM allotments – provided that the qualifying Tribe or Tribal consortium retains 51% ownership or control of the applicant entity. It remains to be seen whether non-Tribal entrepreneurs will find such partnering opportunities attractive. And in view of the major league restrictions that characterize the entire Tribal Allotment process, it also remains to be seen whether very many of these allotments will come into being in the first place.
But one thing is clear: the Commission has committed itself to promoting broadcast ownership by, and broadcast service for, Native Americans. And more importantly, the Commission has acted – slowly, perhaps, but still aggressively – to make good on that commitment.
[While the FCC has formally adopted the new process for dealing with commercial FM Tribal Allotments, that process is not yet in effect: thanks to our old friend, the Paperwork Reduction Act, the process needs to be blessed by OMB before it can kick in. We’ll let you know when that happens.]