FCC Readying Minority Media Ownership Rulemaking
The FCC is preparing to issue a media-ownership rulemaking notice on a broad array of questions, including whether companies can surpass radio and TV station limits when planning to sell assets to minorities (CD Jan 12 p1), agency sources said. They said Chairman Kevin Martin has circulated a further notice of proposed rulemaking among colleagues to deal with an 11-month old petition from Minority Media & Telecommunications Council (MMTC). The notice could be issued as soon as this week, said FCC and industry officials. But eighth-floor negotiations over the length of the public-comment period may stall the notice’s release.
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The rulemaking may ensure that 14 MMTC minority ownership proposals are included in the FCC’s broader media ownership review by specifically seeking public comments on the recommendations. Some MMTC recommendations, if adopted, could further deregulate the broadcast industry by letting regional clusters of radio and TV stations retain “grandfathered” status if they are sold to socially and economically disadvantaged businesses. Grandfathered status lets licensees escape ownership rules issued after they have bought stations later judged to be noncompliant. The commission should develop a definition of disadvantaged businesses “that would be appropriate for broadcasting and be constitutionally sound,” MMTC’s petition said. “An SDB definition is desirable because it would be less dilutive in its impact on minorities by omitting, for example, the children of millionaires who, as new entrants, can qualify as small businesses.” MMTC wants to ban race and sex discrimination in broadcast deals and it asked the FCC to exempt any company from regional ownership limits if it set up an “incubator program” to promote investments from disadvantaged firms. The incubator proposal first was made in 1992.
The Council called the commission’s July 2006 media ownership notice flawed because it failed to describe minority ownership proposals sent back to the agency in Prometheus Radio Project v. FCC by the 3rd U.S. Appeals Court, Philadelphia. Unless the commission seeks comment on specific minority ownership proposals, it risks a second remand, warned MMTC. Although the 2004 ruling asked the FCC to mention the MMTC’s plans, the group said the agency mentioned its proposals only in a footnote to the 2006 notice. “That is all there is,” MMTC said. “What is the commenting public to infer from this stunning lack of clarity?”
The FCC delayed issuing the MMTC notice while Martin sought support from commissioners for combining the media ownership review with one on cable ownership caps, said agency and industry officials. Martin had used the Council’s petition to propose combining the two ownership reviews by issuing a notice on MMTC and cable caps, said FCC officials. That gambit failed after commissioners privately told the chairman that cable caps should be dealt with separately from broadcast limits. The MMTC rulemaking is “clean” because it does not mention other issues, a regulatory lawyer said. MMTC Executive Director David Honig, who balked at combining cable and minority reviews, cheered the prospect of a separate notice. “This is a good sign,” he said. “We're hopeful the commission will make progress with this.”
Now commissioners are negotiating over how long a comment period to set on minority ownership plans, said agency officials. Martin had proposed a 30-day comment period, with replies due 15 days later, said an FCC official. Some commissioners thought that wasn’t enough time, especially during the summer when many people are on vacation. Those commissioners want Martin to agree to a longer comment period, an official said. Another said the notice very likely will be issued soon.