Reexamination of the Comparative Standards for Noncommercial Educational Applicants, 12274-12279 [E9-6432]
Download as PDF
12274
Federal Register / Vol. 74, No. 55 / Tuesday, March 24, 2009 / Rules and Regulations
(g) Disputes between the Executive
agency and GSA arising out of the
ancillary repair and alteration work
will, to the maximum extent practicable,
be resolved informally at the working
level. In the event a dispute cannot be
resolved informally, the matter shall be
referred to GSA’s Public Buildings
Service. The Executive agency agrees
that, in the event GSA’s Public
Buildings Service and the Executive
agency fail to resolve the dispute, they
shall refer it for resolution to the
Administrator of General Services,
whose decision shall be binding.
[FR Doc. E9–6427 Filed 3–23–09; 8:45 am]
BILLING CODE 6820–14–P
FEDERAL COMMUNICATIONS
COMMISSION
47 CFR Part 73
[MM Docket No. 95–31; FCC 08–219]
Reexamination of the Comparative
Standards for Noncommercial
Educational Applicants
mstockstill on PROD1PC66 with RULES
AGENCY: Federal Communications
Commission.
ACTION: Final rule.
SUMMARY: In this document, the
Commission addresses eight petitions
for reconsideration of the Second Report
& Order, in the closed ‘‘mixed groups’’
proceeding. The ‘‘mixed groups’’
proceeding sought to establish rules for
resolving the situation when an
application for an NCE broadcast station
is mutually exclusive with an
application for a commercial broadcast
station. The Second Report & Order
decided to accept applications for NCE
stations on non-reserved channels in
‘‘closed, mixed groups,’’ but to dismiss
those applications if they are mutually
exclusive with applications for
commercial stations. This document
now affords a discrete group of pending
applicants for NCE stations on nonreserved channels in closed, mixed
groups that have been pending since the
date of the Second Report & Order, a
one-time opportunity to amend their
applications to apply for a commercial
broadcast station in order to avoid
dismissal of their applications. This
document reaffirms the other decisions
in the Second Report & Order.
DATES: Effective April 23, 2009.
ADDRESSES: Federal Communications
Commission, 445 12th Street, SW.,
Room TW–A325, Washington, DC
20554. For additional information, see
the SUPPLEMENTARY INFORMATION section
of this document.
VerDate Nov<24>2008
01:02 Mar 24, 2009
Jkt 217001
FOR FURTHER INFORMATION CONTACT: For
additional information on this
proceeding, contact Evan Baranoff, of
the Media Bureau, Policy Division at
Evan.Baranoff@fcc.gov, 418–7142.
SUPPLEMENTARY INFORMATION: This is a
summary of the Commission’s
Memorandum Opinion and Third Order
on Reconsideration, MM Docket No. 95–
31, FCC 08–219, adopted on September
24, 2008 and released on December 2,
2008. The full text of this document is
available on the Internet at the
Commission’s Web site: https://
hraunfoss.fcc.gov/edocs_public/
attachmatch/FCC-08-219A1.doc . It is
also available for inspection and
copying during regular business hours
in the FCC Reference Information
Center, Portals II, 445 12th Street, SW.,
Room CY–A257, Washington, DC 20554.
The complete text may be purchased
from the Commission’s copy and
duplicating contractor, Best Copy &
Printing, Inc. (BCPI), 445 12th Street,
SW., Room CY–B402, Washington, DC
20554. BCPI can be contacted at 202–
488–5300 (phone), 202–488–5563
(facsimile), or https://
www.BCPIWEB.com. Please be prepared
to provide the appropriate FCC
document number (FCC 08–219). To
request this document in accessible
formats (computer diskettes, large print,
audio recording, and Braille), send an email to fcc504@fcc.gov or call the
Commission’s Consumer and
Governmental Affairs Bureau at (202)
418–0530 (voice), (202) 418–0432
(TTY).
Summary of the Memorandum Opinion
& Third Order on Reconsideration
I. Introduction
1. In this Memorandum Opinion &
Third Order on Reconsideration, we
resolve eight petitions for
reconsideration of the Second Report &
Order, 68 FR 26220, May 15, 2003. The
Second Report & Order, among other
things, established ‘‘new policies for
licensing spectrum that the Commission
has not reserved for the exclusive use of
broadcast stations that provide or intend
to provide noncommercial educational
(NCE) service.’’ These new policies
included the decision to permit
applicants for NCE stations to apply for
non-reserved channels, but to dismiss
such applications should they conflict
with applications for commercial
stations. One petitioner seeks
reconsideration of this decision, which
was codified in § 73.5002(b) of the
Commission’s rules. For the reasons
discussed below, we decline to
reconsider establishment of this rule
and affirm our decision to dismiss
PO 00000
Frm 00050
Fmt 4700
Sfmt 4700
applicants for NCE stations for nonreserved channels that conflict with
applications for commercial stations.
Several other petitioners seek
reconsideration of our decision not to
accept any amendments to a discrete
group of long-pending NCE
applications, including amendments to
change an applicant’s status from NCE
to commercial, and request that we not
dismiss this specific group of
applicants. For the reasons discussed
below, we will reconsider the
immediate dismissal of this discrete
group of applicants for NCE stations,
and will afford them a one-time
opportunity to amend their longpending applications to apply for
commercial stations to avoid dismissal.
Accordingly, we grant reconsideration
of our decision not to accept any
amendments to the discrete group of
long-pending applications for NCE
stations, but otherwise deny the
petitions and reaffirm our earlier
conclusions.
II. Background
2. The Second Report & Order
established standards to resolve the
situation when an application for an
NCE broadcast station is mutually
exclusive with an application for a
commercial broadcast station (i.e. ,
‘‘mixed groups’’). NCE stations can
operate both on (1) channels reserved by
the Commission specifically for NCE
service and (2) non-reserved channels,
which are also available to applicants
for commercial stations. The
Commission has long used different
standards to resolve application
conflicts for reserved channels, on the
one hand, and non-reserved channels,
on the other.
3. The Commission initiated this
proceeding in 1995 to revise the criteria
it used to select among competing
applicants for new NCE stations.
Subsequently, the Balanced Budget Act
of 1997, Public Law 105–33, 111 Stat.
251 (1997) amended section 309(j) of the
Communications Act of 1934 (the Act),
to require the Commission to use
competitive bidding to resolve
application conflicts, but exempted NCE
stations from this process, see 47 U.S.C.
309(j) (exempting stations described in
Section 397(6) of the Act). As a result,
the Commission in the Report & Order,
65 FR 36375, June 8, 2000, decided to
use a non-auction, point system to
resolve application conflicts for
reserved channels, and use competitive
bidding to resolve conflicts for nonreserved channels. In National Public
Radio, Inc. v. FCC, 254 F.3d 226, 229
(D.C. Cir. 2001), parties challenged the
procedures for non-reserved channels,
E:\FR\FM\24MRR1.SGM
24MRR1
Federal Register / Vol. 74, No. 55 / Tuesday, March 24, 2009 / Rules and Regulations
and the court concluded that the Act
did not authorize the Commission to
require applicants for NCE stations to
compete at auction for non-reserved
channels.
4. After notice and comment on the
impact of the court decision, the
Commission announced, in the Second
Report & Order, new procedures for
resolving conflicts between NCE and
commercial applications for nonreserved channels and frequencies. In
that order, the Commission held that
although it will accept applications for
NCE stations on non-reserved channels
and frequencies, those that are mutually
exclusive with applications for
commercial stations will be dismissed.
Applicants for AM and secondary
service construction permits, however,
will have a prior opportunity for
settlement.
5. The Commission also reaffirmed
that it will reserve a channel in the
Table of Allotments (used for full-power
FM and TV broadcast stations) for the
exclusive use of NCE stations if a
proponent for reservation demonstrates
that an NCE station is technically
precluded from using already-reserved
channels, and that it will provide
needed NCE service in a given area,
according to certain defined standards.
The Commission indicated that it would
entertain requests for reservation using
these criteria not only in future
allocation proceedings, but also for
allotments for which the Commission
had adopted a Notice of Proposed
Rulemaking before August 7, 2000, and
for which it had not yet opened a filing
window prior to the release of the
Second Report & Order. As to channels
or frequencies for which the
Commission had already accepted longform applications for construction
permits, the Commission concluded that
it would best promote the public
interest to dismiss the long-pending
competing applications for NCE stations
so that the applications for commercial
stations could proceed to auction. The
Commission held that applicants for
NCE stations in these pending, closed
mixed groups would not have further
opportunity to reserve the channels they
had applied for, nor to amend their
previously filed applications to propose
commercial service in order to avoid
dismissal.
mstockstill on PROD1PC66 with RULES
III. Discussion
A. Licensing of Non-Reserved Spectrum
6. Under procedures adopted in the
Second Report & Order, applicants for
NCE stations may submit applications
for non-reserved spectrum in auction
filing windows. These applications are
VerDate Nov<24>2008
01:02 Mar 24, 2009
Jkt 217001
subject to dismissal if there is any
mutually exclusive application for a
commercial station. These procedures
are codified in § 73.5002(b) of the
Commission’s rules. University of
Missouri asks us to reconsider this
decision, contending that it is
tantamount to a ban on NCE stations’
use of the non-reserved spectrum.
University of Missouri argues that
applications for NCE stations are highly
likely to be mutually exclusive with
those for commercial stations, and so
will almost always be dismissed. In
addition, University of Missouri states
that the opportunities we afford NCE
stations to reserve FM and TV channels
and to settle application conflicts in the
AM and translator services are unlikely
to be helpful.
7. In the Second Report & Order, the
Commission fully considered and
rejected University of Missouri’s claim
that this decision is tantamount to a ban
on NCE stations’ use of the non-reserved
spectrum. University of Missouri offers
no new evidence or changed
circumstances in its petition to cause us
to reconsider our decision. Moreover,
University of Missouri suggests no
lawfully permissible alternative to our
decision. We thus reaffirm our decision,
and reject University of Missouri’s
petition for reconsideration.
8. As explained at the outset of the
Second Report & Order, ‘‘we are
constrained by a number of court
decisions, regulations, and statutory
provisions that, taken together, limit our
options.’’ Again, the entirety of section
309(j)(1), 47 U.S.C. 309(j)(1), states: ‘‘If,
consistent with the obligations
described in paragraph (6)(E), mutually
exclusive applications are accepted for
any initial license or construction
permit, then, except as provided in
paragraph (2), the Commission shall
grant the license or permit to a qualified
applicant through a system of
competitive bidding * * * ’’ Paragraph
2 sets forth the relevant exemptions:
‘‘The competitive bidding authority
granted by this subsection shall not
apply to licenses or construction
permits issued by the Commission
* * * for stations described in section
397(6) of this Act,’’ i.e., NCE stations.
9. Taken together, the statutory
provisions sharply limit the
Commission’s authority in this area. In
the past, the Commission allowed
applicants for NCE stations to compete
for non-reserved spectrum under the
standards that applied to applicants for
commercial stations. The Commission
attempted to continue that longstanding
policy after the 1997 Balanced Budget
Act by allowing NCE stations to
compete at auction for non-reserved
PO 00000
Frm 00051
Fmt 4700
Sfmt 4700
12275
channels and frequencies. As
recognized by the NPR case, the statute
mandates that we resolve mutually
exclusive applications for commercial
stations by competitive bidding,
prohibits us from using that same
system to resolve applications for NCE
stations, but does not require us to
follow any particular alternative
procedure for applications for NCE
stations. Accordingly, in the Second
Further Notice, 67 FR 9945, March 5,
2002, the Commission outlined two
possible courses of action: (1) Prohibit
applications for NCE stations on nonreserved channels or frequencies, just as
the Commission prohibits applications
for commercial stations on reserved
channels or frequencies, or (2) continue
to allow the filing of applications for
NCE station, which would be subject to
dismissal if any conflict with
applications for commercial stations
could not be resolved. In the Second
Report & Order, the Commission opted
for the latter course of action. No
commenting party suggested a workable
alternative. The Commission believed
that these two options were the most
straightforward solutions to the problem
and chose the one that was least harsh
to applicants for NCE stations.
10. The reservation and settlement
opportunities are not as limited as
University of Missouri suggests, and
thus our rule is not tantamount to a ban
on NCE stations’ use of non-reserved
spectrum. As the Commission noted in
the Second Report & Order, ‘‘several
parties have asked the Commission to
allocate particular FM channels as
reserved pursuant to the relaxed
reservation standards [adopted in the
Report & Order in the proceeding], and
we have done so.’’ Since the
Commission released the Second Report
& Order, the Media Bureau opened a
window accepting reservation showings
for nearly 500 additional FM channels.
In response, 129 petitioners sought to
reserve 91 vacant FM allotments.
University of Missouri was one of the
petitioners that took advantage of this
opportunity. To date, 56 vacant FM
allotments have been successfully
reserved for NCE use. With respect to
the effectiveness of settlement
opportunities, as the Commission
explained in the Second Report &
Order, the Commission received
approximately 4,700 applications for
LPTV and TV translator stations during
an auction filing window, but processed
more than one third of them prior to
auction because either only one
application was filed, or the applicants
reached a settlement. We fully recognize
that the opportunities for reservation
E:\FR\FM\24MRR1.SGM
24MRR1
12276
Federal Register / Vol. 74, No. 55 / Tuesday, March 24, 2009 / Rules and Regulations
mstockstill on PROD1PC66 with RULES
and settlement are limited, and may not
be as plentiful as University of Missouri
prefers. We continue to believe,
however, that the Commission’s
decision, given the statutory constraints,
best serves the public interest, and again
note that University of Missouri has
failed to suggest any alternative
approach that would comport with the
legal restrictions on our authority in this
area. Consequently, we decline to
reconsider the decisions to accept
applications for NCE stations on nonreserved channels and frequencies and
to dismiss such applications if they
remain mutually exclusive with
applications for commercial stations
after the expiration of any applicable
opportunity for settlement.
B. Pending Applications
11. As discussed in the Second Report
& Order, there remain pending closed
groups of non-reserved channel
mutually exclusive construction permit
applications for NCE and commercial
stations (i.e., ‘‘mixed groups’’).
Applications in these mixed groups
were identified in Attachment A to
‘‘Window Opened to Permit Settlements
for Closed Groups of Mutually Exclusive
Broadcast Applications,’’ Public Notice,
16 FCC Rcd 17091 (2001). In the Second
Report & Order, the Commission
decided to dismiss the long-pending
applications for NCE stations in mixed
groups without providing these
applicants an opportunity to avoid
dismissal by amending their
applications to change their status from
NCE to commercial. Approximately 19
mixed groups of mutually exclusive
applications for non-reserved channels
remain pending; these include 13 FM
mixed groups, two FM translator mixed
groups, and four TV mixed groups. For
the reasons discussed below, we will
now reconsider the Commission’s
decision in the Second Report and
Order and afford each of these
applicants for NCE stations in the
pending, closed mixed groups a onetime opportunity to amend their
applications to apply for a commercial
broadcast station in order to avoid
dismissal.
12. Four petitioners ask us to
reconsider the Commission’s decision to
dismiss these long-pending applications
for NCE stations. Several petitioners
contend that the decision is arbitrary
and capricious. Black Hawk also claims
that the decision is impermissibly
retroactive. Marist College contends that
the decision is inconsistent with the
1997 Balanced Budget Act. In addition,
Fatima Response argues that the
decision is not in the public interest. As
alternatives, Black Hawk suggests that
VerDate Nov<24>2008
01:02 Mar 24, 2009
Jkt 217001
we give applicants with pending
applications for NCE stations an
opportunity to use the reservation
procedures we established for future
applicants; likewise, Fatima Response
and Renaissance Community suggest
that we permit applicants with pending
applications for NCE stations in mixed
groups to amend their applications to
apply for commercial broadcast stations.
Jack Garter opposes Black Hawk’s
petition, and argues that the Second
Report & Order is not arbitrary and
capricious or impermissibly retroactive
and did not violate any processing
‘‘rights.’’
13. The Commission’s primary
rationale for previously opting to
dismiss the pending applications for
NCE stations in mixed groups was that
some of these applications had been
filed a decade ago, and that the
Commission had provided numerous
settlement opportunities to these mixed
group applicants. In the Second Report
& Order, the Commission was ‘‘not
persuaded that the equities favoring the
applicants for NCE stations in these
pending proceedings outweigh the delay
in initiating new broadcast service to
the public as well as the unfairness to
applicants for commercial stations.’’
14. We now are persuaded that the
unfairness of immediate dismissal to
this discrete group of long-pending
applications for NCE stations outweighs
any delay to those applicants for
commercial stations that are mutually
exclusive with these applicants. Unlike
prospective applicants for NCE stations,
these applicants for NCE stations in the
mixed groups sought to be licensed as
NCE stations before adoption of the
Second Report & Order and thus
without knowledge of the consequences
of this decision. Moreover, we believe
that we can expeditiously afford mixed
group applicants for NCE stations a onetime opportunity to amend their
pending applications to apply for a
commercial station, while avoiding
unnecessary delay to the pending
commercial applicants, which initially
dissuaded the Commission from
providing such an opportunity.
15. Shortly after release of this Order,
the Media Bureau will announce an
amendment window to permit all
applicants in the approximately 19
pending, closed mixed groups (1) that
had filed applications for NCE stations
as of the date of the Second Report &
Order and that remain pending, and (2)
that were mutually exclusive with those
for commercial stations as of the date of
the Second Report & Order, to amend
their pending applications for the sole
purpose of applying for a commercial
station. After the close of this window,
PO 00000
Frm 00052
Fmt 4700
Sfmt 4700
any application for an NCE station that
remains mutually exclusive with any
application for a commercial station
will be dismissed with prejudice. There
will be no additional opportunity for
applicants in these pending, closed
mixed groups to further amend their
long-form applications. We believe that
this processing policy will provide
fairer treatment to pending applicants
and better serve the public interest. It
will give applicants for NCE stations
one opportunity to reevaluate their longpending plans in the context of full and
complete information about how the
licensing process will work and, as
designed, it should not appreciably
delay the introduction of new service.
This approach will avoid the harsh
result of dismissing applicants based on
subsequently adopted processing rules
in a manner that is consistent with the
Act and with our commercial and NCE
licensing schemes.
C. Vacant Allotments
16. Bible Broadcasting states that it
agrees with the Commission’s decision
to accept reservation showings for
certain vacant FM allotments and
requests that we award three points to
the successful reservation proponent in
the subsequent application of the point
system for that FM allotment. In
essence, Bible Broadcasting asks us to
award a ‘‘finder’s preference’’ to the
successful proponent of a reservation
showing. Bible Broadcasting explains
that many applicants for NCE stations
have limited resources, and will be
unwilling to undertake the expense of
preparing a reservation showing without
receiving such a preference at the
licensing stage.
17. We deny Bible Broadcasting’s
petition. As a preliminary matter, the
Commission does not award a finder’s
preference to successful proponents of
allocations for commercial stations.
Moreover, in adopting the current point
system for NCE stations on reserved
channels, the Commission explicitly
declined to give any kind of finder’s
preference to the first entity or
individual to file an application for a
given frequency. We recognize that such
a preference would create an incentive
for any entity or individual to pursue a
new allocation or to reserve it for NCE
use. We believe, however, the existing
factors in our current point system best
serve the public interest in selecting a
licensee. As the Commission said when
it selected the point system over other
methodologies to resolve application
conflicts, favoring those who file first is
not ‘‘the optimal way to select
applicants who will provide ’diversity
and excellence’ in educational
E:\FR\FM\24MRR1.SGM
24MRR1
Federal Register / Vol. 74, No. 55 / Tuesday, March 24, 2009 / Rules and Regulations
mstockstill on PROD1PC66 with RULES
broadcasting to the public.’’
Accordingly, we decline to award points
to the successful proponent of a
reservation showing.
D. Miscellaneous Issues
18. MMTC Pleadings Withdrawn. On
June 16, 2003, MMTC filed a petition for
reconsideration of the Second Report &
Order, seeking changes in the eligibility
requirements for the new entrant
bidding credit used in broadcast
auctions. In its petition, MMTC
specifically requested that applicants in
FM Auction No. 37 ‘‘immediately’’
report changes that cause a loss of, or
reduction in, eligibility for a new
entrant bidding credit. The Commission
subsequently established such a
requirement in FM Auction No. 37, and,
as a result, MMTC withdrew its petition
for reconsideration by a letter dated
October 19, 2004. Accordingly, this
matter is no longer before the
Commission in this proceeding.
19. Licenses Formerly Held by
Michael Rice-Controlled Entities. By
Public Notice, 16 FCC Rcd 12832,
released July 3, 2001, the Media Bureau
and the Wireless Telecommunications
Bureau collectively gave notice of filing
procedures for applications for interim
and permanent authority to operate the
two AM (Rice AM Stations) and five FM
stations (Rice FM Stations) (collectively,
the Rice Stations) formerly licensed to
entities controlled by Michael Rice.
Because the filing window for AM
Auction No. 32 had been completed, the
Rice Public Notice announced a
supplemental AM Auction No. 32 filing
window for the Rice AM Stations. Seven
entities timely filed applications for the
AM facility at 640 KHz, Terre Haute, IN;
six entities timely filed applications for
the AM facility at 1230 KHz, Terre
Haute, IN. One of the entities applying
for both of the Rice AM stations, Word
Power, Inc., indicated that it was
applying for NCE stations. The Rice
Public Notice also announced that the
now-vacant allotments for the Rice FM
Stations would be included in FM
Auction No. 37 and interested parties
could file Form 175 applications in the
then-upcoming auction filing window.
The allotments for the five Rice FM
Stations were also included in the
Public Notice, described supra, listing
500 vacant FM allotments for which
NCE reservation showings could be
filed. Four of the five Rice FM Station
allotments received reservation
showings.
20. University of Missouri now
expresses concern about the impact of
the Second Report & Order on the
licenses for the Rice Stations and, in
particular, the Channel 252C2 allotment
VerDate Nov<24>2008
01:02 Mar 24, 2009
Jkt 217001
in Columbia, Missouri—formerly
licensed as KFMZ-FM. University of
Missouri asks us to clarify whether the
policies and rules established in the
Second Report & Order apply to interim
licensing for this channel. University of
Missouri also contends that it should
have an opportunity to reserve this
channel for exclusive NCE use
according to the criteria discussed in the
Second Report & Order. Ultimately,
University of Missouri suggests, the
Commission should adopt unique
procedures to license KFMZ–FM to
avoid the litigation that it anticipates
will result from the allotment’s auction.
21. As previously discussed, the
Media Bureau opened a window to
permit interested parties an opportunity
to reserve any of approximately 500
vacant FM allotments. Channel 252C2
in Columbia, Missouri was among these
FM allotments, as were the four other
FM channels previously used by Mr.
Rice. University of Missouri, in fact,
filed a reservation showing for the FM
channel it seeks. Thus, insofar as it
seeks this opportunity in its petition,
the issue is now moot. To the extent
University of Missouri seeks a nonauction mechanism to award a license
for the channel on a permanent basis,
we see no grounds for doing so. We find
unpersuasive University of Missouri’s
argument that ineligible parties may
attempt to acquire the license, and that
such efforts will result in timeconsuming litigation. This possibility
applies to all broadcast auctions. A
petitioner may raise such arguments
post-auction when a prevailing
applicant’s long-form application is
filed. Thus, this concern is insufficient
to overcome the clear imperative of
section 309(j) of the Act.
22. Applications filed in the
supplemental AM Auction No. 32 filing
window for the two Rice AM Stations
also predated the release of the Second
Report & Order. As a result of the
Second Report & Order, any of the
applications for NCE stations filed
during this window that are mutually
exclusive with applications for
commercial stations are to be dismissed.
The application of Word Power, Inc.
was the only application for an NCE
station. We, therefore, offer Word
Power, Inc. the same relief offered to the
applicants for NCE stations in mixed
groups, discussed above, and will afford
it the same time-limited opportunity to
amend its application(s) to apply for
commercial stations, in accordance with
the procedures set forth above. After
this limited amendment opportunity, all
remaining mutually exclusive
applications for commercial stations for
PO 00000
Frm 00053
Fmt 4700
Sfmt 4700
12277
the Rice AM Stations will proceed to
auction.
IV. Conclusion
23. In this Memorandum Opinion &
Third Order on Reconsideration, we
reaffirm all decisions in the Second
Report & Order, except that we will now
permit parties with applications for NCE
stations on non-reserved channels in
closed mixed groups that have been
pending since the date of the Second
Report & Order, and were then mutually
exclusive with applications for
commercial stations, a one-time
opportunity to amend their
applications. We believe that
reaffirmation of our earlier conclusions,
subject to this change, best serves the
public interest.
V. Procedural Matters
24. Accessibility Information. To
request information in accessible
formats (computer diskettes, large print,
audio recording, and Braille), send an email to fcc504@fcc.gov or call the FCC’s
Consumer and Governmental Affairs
Bureau at (202) 418–0530 (voice), (202)
418–0432 (TTY). This document can
also be downloaded in Word and
Portable Document Format (PDF) at:
https://www.fcc.gov.
25. Final Paperwork Reduction Act
Analysis. This Memorandum Opinion &
Third Order on Reconsideration
contains no new or modified
information collections subject to the
Paperwork Reduction Act of 1995,
Public Law 104–13, 109 Stat. 163 (1995)
(codified in Chapter 35 of Title 44
U.S.C.). In addition, therefore, it does
not contain any new or modified
‘‘information collection burden for
small business concerns with fewer than
25 employees,’’ pursuant to the Small
Business Paperwork Relief Act of 2002,
Public Law 107–198, 116 Stat. 729
(2002) (codified in Chapter 35 of title 44
U.S.C.); see 44 U.S.C. 3506(c)(4).
26. Supplemental Final Regulatory
Flexibility Analysis. As required by the
Regulatory Flexibility Act of 1980, 5
U.S.C. 603, as amended by the Small
Business Regulatory Enforcement
Fairness Act of 1996 (SBREFA), Public
Law 104–121, 110 Stat. 847 (1996), an
Initial Regulatory Flexibility Analysis
(IRFA) was incorporated in the Second
Further Notice. The Commission sought
written public comment on the
proposals in the Second Further Notice,
including comment on the IRFA. No
comments addressed the IRFA. A Final
Regulatory Flexibility Analysis (FRFA)
was published in the Second Report &
Order. This present Supplemental
FRFA, which conforms to the RFA,
supplements that FRFA. We note that
E:\FR\FM\24MRR1.SGM
24MRR1
12278
Federal Register / Vol. 74, No. 55 / Tuesday, March 24, 2009 / Rules and Regulations
B. Summary of Significant Issues Raised
by the Public in Responses to the IRFA
A. Need for, and Objectives of, the
Memorandum Opinion & Third Order
on Reconsideration
mstockstill on PROD1PC66 with RULES
the Supplemental FRFA addresses only
the matters considered on
reconsideration in the Memorandum
Opinion & Third Order on
Reconsideration. Therefore, this
Supplemental FRFA addresses only the
one decision reversed from the Second
Report & Order.
29. The RFA directs the Commission
to provide a description of, and, where
feasible, an estimate of the number of
small entities that will be affected by the
rules. The RFA defines the term ‘‘small
entity’’ as having the same meaning as
‘‘small business,’’ ‘‘small organization,’’
and ‘‘small governmental jurisdiction.’’
In addition, the term ‘‘small business’’
has the same meaning as the term
‘‘small business concern’’ under the
Small Business Act. A ‘‘small business
concern’’ is one that: (1) Is
independently owned and operated; (2)
is not dominant in its field of operation;
and (3) satisfies any additional criteria
established by the SBA.
30. The decision adopted in this
Memorandum Opinion & Third Order
on Reconsideration will affect only (1)
the discrete group of applicants for NCE
stations for non-reserved channels and
(2) those applicants for commercial
stations that are mutually exclusive
with these NCE applicants. These
groups may include small businesses,
and were included in the description
and estimate of small entities in the
FRFA to the Second Report & Order.
31. Radio. The applicants affected by
this new decision may include existing
radio stations. SBA defines as a small
business those radio broadcasting
stations that have no more than $7.0
million in annual receipts. The
Commission has estimated the number
of licensed radio stations to be 13,837,
of which 4,754 are AM stations, 6,266
are commercial FM stations, and 2,817
are NCE FM stations. According to
Commission staff review of the BIA
Financial Network, MAPro Television
Database (BIA) of March 30, 2007, about
10,420 commercial radio stations (or
about 95 percent) of an estimated 11,000
commercial radio stations have revenue
of $7.0 million or less. Many
commercial radio stations, however, are
affiliated with larger corporations with
higher revenue, with the result that the
estimated number of commercial radio
stations overstates the number that
qualify as small entities. The
Commission does not compile and
otherwise does not have access to
information on the revenue of NCE
stations that would permit it to
determine how many such stations
would qualify as small entities.
27. The Commission adopts this
Memorandum Opinion & Third Order
on Reconsideration to reaffirm its earlier
conclusions in the Second Report &
Order, except for one decision. In the
Second Report & Order, the Commission
decided to dismiss a discrete group of
applicants for NCE stations for nonreserved channels that were mutually
exclusive with applications for
commercial stations without providing
these applicants an opportunity to avoid
dismissal by amending their
applications to change their status from
NCE to commercial. This discrete group
of long-pending applications for NCE
stations consists of approximately 19
mixed groups of mutually exclusive
applications for non-reserved channels
filed between 1994 and 1997; these
include 13 FM mixed groups, two FM
translator mixed groups, and four TV
mixed groups. On reconsideration, the
Commission will now afford each of
these applicants a one-time opportunity
to amend their applications to apply for
a commercial broadcast station before
dismissing these applications. The
Commission is persuaded that the
unfairness of immediate dismissal to
this discrete group of long-pending
applications for NCE stations outweighs
any delay to those applicants for
commercial stations that are mutually
exclusive with these applicants. Unlike
prospective applicants for NCE stations,
these applicants for NCE stations in the
mixed groups sought to be licensed as
NCE stations before adoption of the
Second Report & Order and thus
without knowledge of the consequences
of this decision. Moreover, the
Commission finds that it can
expeditiously afford mixed group
applicants for NCE stations a one-time
opportunity to amend their pending
applications to apply for a commercial
station, while avoiding unnecessary
delay to the pending commercial
applicants, which initially dissuaded
the Commission from providing such an
opportunity.
VerDate Nov<24>2008
01:02 Mar 24, 2009
Jkt 217001
28. No comments addressed the IRFA,
or otherwise discussed issues that may
impact small entities.
C. Description and Estimate of the
Number of Small Entities To Which the
Rules Will Apply
PO 00000
Frm 00054
Fmt 4700
Sfmt 4700
32. Television. The applicants affected
by this new decision may also include
TV stations. The SBA defines a
television broadcast station as a small
business if such station has no more
than $14.0 million in annual receipts.
Business concerns included in this
industry are those ‘‘primarily engaged in
broadcasting images together with
sound.’’ The Commission has estimated
the number of licensed commercial
television stations to be 1,376.
According to Commission staff review
of the BIA Financial Network, MAPro
Television Database (BIA) on March 30,
2007, about 986 of an estimated 1,374
commercial television stations (or about
72 percent) have revenues of $14.0
million or less and thus qualify as small
entities under the SBA definition. The
Commission has estimated the number
of licensed NCE television stations to be
380. We note, however, that, in
assessing whether a business concern
qualifies as small under the above
definition, business (control) affiliations
must be included. Our estimate,
therefore, likely overstates the number
of small entities that might be affected
by our action, because the revenue
figure on which it is based does not
include or aggregate revenues from
affiliated companies. The Commission
does not compile and otherwise does
not have access to information on the
revenue of NCE stations that would
permit it to determine how many such
stations would qualify as small entities.
33. In addition, an element of the
definition of ‘‘small business’’ is that the
entity not be dominant in its field of
operation. We are unable at this time to
define or quantify the criteria that
would establish whether a specific
television station is dominant in its field
of operation. Accordingly, the estimate
of small businesses to which rules may
apply do not exclude any television
station from the definition of a small
business on this basis and are therefore
over-inclusive to that extent. Also as
noted, an additional element of the
definition of ‘‘small business’’ is that the
entity must be independently owned
and operated. We note that it is difficult
at times to assess these criteria in the
context of media entities and our
estimates of small businesses to which
they apply may be over-inclusive to this
extent.
D. Description of Projected Reporting,
Recordkeeping, and Other Compliance
Requirements
34. The decision adopted in this
Memorandum Opinion & Third Order
on Reconsideration will not result in a
change in the existing compliance,
reporting and recordkeeping
E:\FR\FM\24MRR1.SGM
24MRR1
Federal Register / Vol. 74, No. 55 / Tuesday, March 24, 2009 / Rules and Regulations
requirements, except with respect to the
discrete group of applicants for NCE
stations that were previously dismissed
in the Second Report & Order because
they were mutually exclusive with
applications for commercial stations. As
a result of this Order, the discrete group
of applicants for NCE stations is being
permitted a one-time opportunity to file
an amendment to their applications to
change their status from NCE to
commercial, and thereby avoid
dismissal of their applications.
mstockstill on PROD1PC66 with RULES
E. Steps Taken To Minimize Significant
Economic Impact on Small Entities, and
Significant Alternatives Considered
35. The RFA requires an agency to
describe any significant alternatives that
it has considered in adopting its rules,
which may include the following four
alternatives (among others): (1) The
establishment of differing compliance or
reporting requirements or timetables
that take into account the resources
available to small entities; (2) the
clarification, consolidation, or
simplification of compliance or
reporting requirements under the rule
for small entities; (3) the use of
performance, rather than design,
standards; and (4) an exemption from
coverage of the rule, or any part thereof,
for small entities.
36. On reconsideration, the
Commission determined it has two
choices: (1) Reaffirm its decision in the
Second Report & Order to immediately
dismiss this discrete group of applicants
for NCE stations or (2) give these
applicants an opportunity to amend
their applications to change their status
from NCE to commercial, and thus
avoid dismissal. In the Second Report &
Order, we were not persuaded that the
equities favoring the applicants for NCE
stations outweighed the delay in
initiating new broadcast service to the
public as well as the unfairness to
applicants for commercial stations. But
we now believe that the unfairness of
immediate dismissal to this discrete
group of applicants for NCE stations
outweighs any delay or unfairness to
those applicants for commercial stations
that are mutually exclusive with these
VerDate Nov<24>2008
01:02 Mar 24, 2009
Jkt 217001
applicants. Unlike future applicants for
NCE stations, these applicants for NCE
stations in the mixed groups sought to
be licensed as an NCE station before
adoption of the Second Report & Order
and thus without full knowledge of the
consequences of this decision.
Moreover, we now believe that we can
expeditiously afford applicants with
pending applications a one-time
opportunity to amend their applications
to apply for a commercial station yet
will avoid the delay and unfairness to
applicants for commercial stations that
initially dissuaded us from providing
such an opportunity. After this filing
opportunity, any application for an NCE
station that remains mutually exclusive
with any application for a commercial
station will be dismissed with
prejudice, in accordance with
§ 73.5002(b) of the rules. There will be
no additional opportunity for applicants
in these pending, closed mixed groups
to further amend their long-form
applications. We believe that this
processing policy will provide fairer
treatment to pending applicants and
better serve the public interest. It will
give applicants for NCE stations one
opportunity to reevaluate their longpending plans in the context of full and
complete information about how the
licensing process will work and, as
designed, it should not appreciably
delay the introduction of new service.
This approach will avoid the extremely
harsh result of dismissing applicants
based on subsequently adopted
processing rules in a manner that is
consistent with our statutory
commercial and NCE licensing schemes.
37. Furthermore, our new decision
will benefit the applicants for NCE
stations that are small businesses by
allowing them a chance to compete for
licenses. While some of the applicants
for commercial stations that are small
businesses may be harmed by facing
increased competition for licenses, the
harm to these entities would not be as
great as that to those small businesses
applicants for NCE stations that would
face dismissal of their applications. In
addition, the public is better served by
this enhanced competition.
PO 00000
Frm 00055
Fmt 4700
Sfmt 4700
12279
F. Report to Congress
38. The Commission will send a copy
of this Memorandum Opinion & Third
Order on Reconsideration, including
this FRFA, in a report to be sent to
Congress pursuant to the Congressional
Review Act. In addition, the
Commission will send a copy of this
Memorandum Opinion & Third Order
on Reconsideration, including this
FRFA, to the Chief Counsel for
Advocacy of the Small Business
Administration. A copy of this
Memorandum Opinion & Third Order
on Reconsideration and this FRFA (or
summaries thereof) will also be
published in the Federal Register.
39. Additional Information. For
additional information, please contact
Evan Baranoff, Media Bureau, Policy
Division, (202) 418–2120, or
Evan.Baranoff@fcc.gov.
VI. Ordering Clauses
40. Accordingly, it is ordered that,
pursuant to the authority contained in
sections 1, 2(a), 4(i), 303, 307, 309 and
405(a) of the Communications Act, as
amended, 47 U.S.C. 151, 152(a), 154(i),
303, 307, 309 and 405(a), and § 1.429 of
the Commission’s rules, 47 CFR 1.429,
that the petitions for reconsideration
filed by the parties listed in Appendix
A are granted in part and denied in part
as indicated above, and that this
Memorandum Opinion & Third Order
on Reconsideration is adopted.
41. It is further ordered that the
Commission’s Consumer and
Governmental Affairs Bureau, Reference
Information Center, shall send a copy of
this Memorandum Opinion & Third
Order on Reconsideration, including the
Final Regulatory Flexibility Analysis, to
the Chief Counsel for Advocacy of the
Small Business Administration.
42. It is further ordered that this
proceeding is terminated.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. E9–6432 Filed 3–23–09; 8:45 am]
BILLING CODE 6712–01–P
E:\FR\FM\24MRR1.SGM
24MRR1
Agencies
[Federal Register Volume 74, Number 55 (Tuesday, March 24, 2009)]
[Rules and Regulations]
[Pages 12274-12279]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-6432]
=======================================================================
-----------------------------------------------------------------------
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 73
[MM Docket No. 95-31; FCC 08-219]
Reexamination of the Comparative Standards for Noncommercial
Educational Applicants
AGENCY: Federal Communications Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: In this document, the Commission addresses eight petitions for
reconsideration of the Second Report & Order, in the closed ``mixed
groups'' proceeding. The ``mixed groups'' proceeding sought to
establish rules for resolving the situation when an application for an
NCE broadcast station is mutually exclusive with an application for a
commercial broadcast station. The Second Report & Order decided to
accept applications for NCE stations on non-reserved channels in
``closed, mixed groups,'' but to dismiss those applications if they are
mutually exclusive with applications for commercial stations. This
document now affords a discrete group of pending applicants for NCE
stations on non-reserved channels in closed, mixed groups that have
been pending since the date of the Second Report & Order, a one-time
opportunity to amend their applications to apply for a commercial
broadcast station in order to avoid dismissal of their applications.
This document reaffirms the other decisions in the Second Report &
Order.
DATES: Effective April 23, 2009.
ADDRESSES: Federal Communications Commission, 445 12th Street, SW.,
Room TW-A325, Washington, DC 20554. For additional information, see the
SUPPLEMENTARY INFORMATION section of this document.
FOR FURTHER INFORMATION CONTACT: For additional information on this
proceeding, contact Evan Baranoff, of the Media Bureau, Policy Division
at Evan.Baranoff@fcc.gov, 418-7142.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
Memorandum Opinion and Third Order on Reconsideration, MM Docket No.
95-31, FCC 08-219, adopted on September 24, 2008 and released on
December 2, 2008. The full text of this document is available on the
Internet at the Commission's Web site: https://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-08-219A1.doc . It is also available for
inspection and copying during regular business hours in the FCC
Reference Information Center, Portals II, 445 12th Street, SW., Room
CY-A257, Washington, DC 20554. The complete text may be purchased from
the Commission's copy and duplicating contractor, Best Copy & Printing,
Inc. (BCPI), 445 12th Street, SW., Room CY-B402, Washington, DC 20554.
BCPI can be contacted at 202-488-5300 (phone), 202-488-5563
(facsimile), or https://www.BCPIWEB.com. Please be prepared to provide
the appropriate FCC document number (FCC 08-219). To request this
document in accessible formats (computer diskettes, large print, audio
recording, and Braille), send an e-mail to fcc504@fcc.gov or call the
Commission's Consumer and Governmental Affairs Bureau at (202) 418-0530
(voice), (202) 418-0432 (TTY).
Summary of the Memorandum Opinion & Third Order on Reconsideration
I. Introduction
1. In this Memorandum Opinion & Third Order on Reconsideration, we
resolve eight petitions for reconsideration of the Second Report &
Order, 68 FR 26220, May 15, 2003. The Second Report & Order, among
other things, established ``new policies for licensing spectrum that
the Commission has not reserved for the exclusive use of broadcast
stations that provide or intend to provide noncommercial educational
(NCE) service.'' These new policies included the decision to permit
applicants for NCE stations to apply for non-reserved channels, but to
dismiss such applications should they conflict with applications for
commercial stations. One petitioner seeks reconsideration of this
decision, which was codified in Sec. 73.5002(b) of the Commission's
rules. For the reasons discussed below, we decline to reconsider
establishment of this rule and affirm our decision to dismiss
applicants for NCE stations for non-reserved channels that conflict
with applications for commercial stations. Several other petitioners
seek reconsideration of our decision not to accept any amendments to a
discrete group of long-pending NCE applications, including amendments
to change an applicant's status from NCE to commercial, and request
that we not dismiss this specific group of applicants. For the reasons
discussed below, we will reconsider the immediate dismissal of this
discrete group of applicants for NCE stations, and will afford them a
one-time opportunity to amend their long-pending applications to apply
for commercial stations to avoid dismissal. Accordingly, we grant
reconsideration of our decision not to accept any amendments to the
discrete group of long-pending applications for NCE stations, but
otherwise deny the petitions and reaffirm our earlier conclusions.
II. Background
2. The Second Report & Order established standards to resolve the
situation when an application for an NCE broadcast station is mutually
exclusive with an application for a commercial broadcast station (i.e.
, ``mixed groups''). NCE stations can operate both on (1) channels
reserved by the Commission specifically for NCE service and (2) non-
reserved channels, which are also available to applicants for
commercial stations. The Commission has long used different standards
to resolve application conflicts for reserved channels, on the one
hand, and non-reserved channels, on the other.
3. The Commission initiated this proceeding in 1995 to revise the
criteria it used to select among competing applicants for new NCE
stations. Subsequently, the Balanced Budget Act of 1997, Public Law
105-33, 111 Stat. 251 (1997) amended section 309(j) of the
Communications Act of 1934 (the Act), to require the Commission to use
competitive bidding to resolve application conflicts, but exempted NCE
stations from this process, see 47 U.S.C. 309(j) (exempting stations
described in Section 397(6) of the Act). As a result, the Commission in
the Report & Order, 65 FR 36375, June 8, 2000, decided to use a non-
auction, point system to resolve application conflicts for reserved
channels, and use competitive bidding to resolve conflicts for non-
reserved channels. In National Public Radio, Inc. v. FCC, 254 F.3d 226,
229 (D.C. Cir. 2001), parties challenged the procedures for non-
reserved channels,
[[Page 12275]]
and the court concluded that the Act did not authorize the Commission
to require applicants for NCE stations to compete at auction for non-
reserved channels.
4. After notice and comment on the impact of the court decision,
the Commission announced, in the Second Report & Order, new procedures
for resolving conflicts between NCE and commercial applications for
non-reserved channels and frequencies. In that order, the Commission
held that although it will accept applications for NCE stations on non-
reserved channels and frequencies, those that are mutually exclusive
with applications for commercial stations will be dismissed. Applicants
for AM and secondary service construction permits, however, will have a
prior opportunity for settlement.
5. The Commission also reaffirmed that it will reserve a channel in
the Table of Allotments (used for full-power FM and TV broadcast
stations) for the exclusive use of NCE stations if a proponent for
reservation demonstrates that an NCE station is technically precluded
from using already-reserved channels, and that it will provide needed
NCE service in a given area, according to certain defined standards.
The Commission indicated that it would entertain requests for
reservation using these criteria not only in future allocation
proceedings, but also for allotments for which the Commission had
adopted a Notice of Proposed Rulemaking before August 7, 2000, and for
which it had not yet opened a filing window prior to the release of the
Second Report & Order. As to channels or frequencies for which the
Commission had already accepted long-form applications for construction
permits, the Commission concluded that it would best promote the public
interest to dismiss the long-pending competing applications for NCE
stations so that the applications for commercial stations could proceed
to auction. The Commission held that applicants for NCE stations in
these pending, closed mixed groups would not have further opportunity
to reserve the channels they had applied for, nor to amend their
previously filed applications to propose commercial service in order to
avoid dismissal.
III. Discussion
A. Licensing of Non-Reserved Spectrum
6. Under procedures adopted in the Second Report & Order,
applicants for NCE stations may submit applications for non-reserved
spectrum in auction filing windows. These applications are subject to
dismissal if there is any mutually exclusive application for a
commercial station. These procedures are codified in Sec. 73.5002(b)
of the Commission's rules. University of Missouri asks us to reconsider
this decision, contending that it is tantamount to a ban on NCE
stations' use of the non-reserved spectrum. University of Missouri
argues that applications for NCE stations are highly likely to be
mutually exclusive with those for commercial stations, and so will
almost always be dismissed. In addition, University of Missouri states
that the opportunities we afford NCE stations to reserve FM and TV
channels and to settle application conflicts in the AM and translator
services are unlikely to be helpful.
7. In the Second Report & Order, the Commission fully considered
and rejected University of Missouri's claim that this decision is
tantamount to a ban on NCE stations' use of the non-reserved spectrum.
University of Missouri offers no new evidence or changed circumstances
in its petition to cause us to reconsider our decision. Moreover,
University of Missouri suggests no lawfully permissible alternative to
our decision. We thus reaffirm our decision, and reject University of
Missouri's petition for reconsideration.
8. As explained at the outset of the Second Report & Order, ``we
are constrained by a number of court decisions, regulations, and
statutory provisions that, taken together, limit our options.'' Again,
the entirety of section 309(j)(1), 47 U.S.C. 309(j)(1), states: ``If,
consistent with the obligations described in paragraph (6)(E), mutually
exclusive applications are accepted for any initial license or
construction permit, then, except as provided in paragraph (2), the
Commission shall grant the license or permit to a qualified applicant
through a system of competitive bidding * * * '' Paragraph 2 sets forth
the relevant exemptions: ``The competitive bidding authority granted by
this subsection shall not apply to licenses or construction permits
issued by the Commission * * * for stations described in section 397(6)
of this Act,'' i.e., NCE stations.
9. Taken together, the statutory provisions sharply limit the
Commission's authority in this area. In the past, the Commission
allowed applicants for NCE stations to compete for non-reserved
spectrum under the standards that applied to applicants for commercial
stations. The Commission attempted to continue that longstanding policy
after the 1997 Balanced Budget Act by allowing NCE stations to compete
at auction for non-reserved channels and frequencies. As recognized by
the NPR case, the statute mandates that we resolve mutually exclusive
applications for commercial stations by competitive bidding, prohibits
us from using that same system to resolve applications for NCE
stations, but does not require us to follow any particular alternative
procedure for applications for NCE stations. Accordingly, in the Second
Further Notice, 67 FR 9945, March 5, 2002, the Commission outlined two
possible courses of action: (1) Prohibit applications for NCE stations
on non-reserved channels or frequencies, just as the Commission
prohibits applications for commercial stations on reserved channels or
frequencies, or (2) continue to allow the filing of applications for
NCE station, which would be subject to dismissal if any conflict with
applications for commercial stations could not be resolved. In the
Second Report & Order, the Commission opted for the latter course of
action. No commenting party suggested a workable alternative. The
Commission believed that these two options were the most
straightforward solutions to the problem and chose the one that was
least harsh to applicants for NCE stations.
10. The reservation and settlement opportunities are not as limited
as University of Missouri suggests, and thus our rule is not tantamount
to a ban on NCE stations' use of non-reserved spectrum. As the
Commission noted in the Second Report & Order, ``several parties have
asked the Commission to allocate particular FM channels as reserved
pursuant to the relaxed reservation standards [adopted in the Report &
Order in the proceeding], and we have done so.'' Since the Commission
released the Second Report & Order, the Media Bureau opened a window
accepting reservation showings for nearly 500 additional FM channels.
In response, 129 petitioners sought to reserve 91 vacant FM allotments.
University of Missouri was one of the petitioners that took advantage
of this opportunity. To date, 56 vacant FM allotments have been
successfully reserved for NCE use. With respect to the effectiveness of
settlement opportunities, as the Commission explained in the Second
Report & Order, the Commission received approximately 4,700
applications for LPTV and TV translator stations during an auction
filing window, but processed more than one third of them prior to
auction because either only one application was filed, or the
applicants reached a settlement. We fully recognize that the
opportunities for reservation
[[Page 12276]]
and settlement are limited, and may not be as plentiful as University
of Missouri prefers. We continue to believe, however, that the
Commission's decision, given the statutory constraints, best serves the
public interest, and again note that University of Missouri has failed
to suggest any alternative approach that would comport with the legal
restrictions on our authority in this area. Consequently, we decline to
reconsider the decisions to accept applications for NCE stations on
non-reserved channels and frequencies and to dismiss such applications
if they remain mutually exclusive with applications for commercial
stations after the expiration of any applicable opportunity for
settlement.
B. Pending Applications
11. As discussed in the Second Report & Order, there remain pending
closed groups of non-reserved channel mutually exclusive construction
permit applications for NCE and commercial stations (i.e., ``mixed
groups''). Applications in these mixed groups were identified in
Attachment A to ``Window Opened to Permit Settlements for Closed Groups
of Mutually Exclusive Broadcast Applications,'' Public Notice, 16 FCC
Rcd 17091 (2001). In the Second Report & Order, the Commission decided
to dismiss the long-pending applications for NCE stations in mixed
groups without providing these applicants an opportunity to avoid
dismissal by amending their applications to change their status from
NCE to commercial. Approximately 19 mixed groups of mutually exclusive
applications for non-reserved channels remain pending; these include 13
FM mixed groups, two FM translator mixed groups, and four TV mixed
groups. For the reasons discussed below, we will now reconsider the
Commission's decision in the Second Report and Order and afford each of
these applicants for NCE stations in the pending, closed mixed groups a
one-time opportunity to amend their applications to apply for a
commercial broadcast station in order to avoid dismissal.
12. Four petitioners ask us to reconsider the Commission's decision
to dismiss these long-pending applications for NCE stations. Several
petitioners contend that the decision is arbitrary and capricious.
Black Hawk also claims that the decision is impermissibly retroactive.
Marist College contends that the decision is inconsistent with the 1997
Balanced Budget Act. In addition, Fatima Response argues that the
decision is not in the public interest. As alternatives, Black Hawk
suggests that we give applicants with pending applications for NCE
stations an opportunity to use the reservation procedures we
established for future applicants; likewise, Fatima Response and
Renaissance Community suggest that we permit applicants with pending
applications for NCE stations in mixed groups to amend their
applications to apply for commercial broadcast stations. Jack Garter
opposes Black Hawk's petition, and argues that the Second Report &
Order is not arbitrary and capricious or impermissibly retroactive and
did not violate any processing ``rights.''
13. The Commission's primary rationale for previously opting to
dismiss the pending applications for NCE stations in mixed groups was
that some of these applications had been filed a decade ago, and that
the Commission had provided numerous settlement opportunities to these
mixed group applicants. In the Second Report & Order, the Commission
was ``not persuaded that the equities favoring the applicants for NCE
stations in these pending proceedings outweigh the delay in initiating
new broadcast service to the public as well as the unfairness to
applicants for commercial stations.''
14. We now are persuaded that the unfairness of immediate dismissal
to this discrete group of long-pending applications for NCE stations
outweighs any delay to those applicants for commercial stations that
are mutually exclusive with these applicants. Unlike prospective
applicants for NCE stations, these applicants for NCE stations in the
mixed groups sought to be licensed as NCE stations before adoption of
the Second Report & Order and thus without knowledge of the
consequences of this decision. Moreover, we believe that we can
expeditiously afford mixed group applicants for NCE stations a one-time
opportunity to amend their pending applications to apply for a
commercial station, while avoiding unnecessary delay to the pending
commercial applicants, which initially dissuaded the Commission from
providing such an opportunity.
15. Shortly after release of this Order, the Media Bureau will
announce an amendment window to permit all applicants in the
approximately 19 pending, closed mixed groups (1) that had filed
applications for NCE stations as of the date of the Second Report &
Order and that remain pending, and (2) that were mutually exclusive
with those for commercial stations as of the date of the Second Report
& Order, to amend their pending applications for the sole purpose of
applying for a commercial station. After the close of this window, any
application for an NCE station that remains mutually exclusive with any
application for a commercial station will be dismissed with prejudice.
There will be no additional opportunity for applicants in these
pending, closed mixed groups to further amend their long-form
applications. We believe that this processing policy will provide
fairer treatment to pending applicants and better serve the public
interest. It will give applicants for NCE stations one opportunity to
reevaluate their long-pending plans in the context of full and complete
information about how the licensing process will work and, as designed,
it should not appreciably delay the introduction of new service. This
approach will avoid the harsh result of dismissing applicants based on
subsequently adopted processing rules in a manner that is consistent
with the Act and with our commercial and NCE licensing schemes.
C. Vacant Allotments
16. Bible Broadcasting states that it agrees with the Commission's
decision to accept reservation showings for certain vacant FM
allotments and requests that we award three points to the successful
reservation proponent in the subsequent application of the point system
for that FM allotment. In essence, Bible Broadcasting asks us to award
a ``finder's preference'' to the successful proponent of a reservation
showing. Bible Broadcasting explains that many applicants for NCE
stations have limited resources, and will be unwilling to undertake the
expense of preparing a reservation showing without receiving such a
preference at the licensing stage.
17. We deny Bible Broadcasting's petition. As a preliminary matter,
the Commission does not award a finder's preference to successful
proponents of allocations for commercial stations. Moreover, in
adopting the current point system for NCE stations on reserved
channels, the Commission explicitly declined to give any kind of
finder's preference to the first entity or individual to file an
application for a given frequency. We recognize that such a preference
would create an incentive for any entity or individual to pursue a new
allocation or to reserve it for NCE use. We believe, however, the
existing factors in our current point system best serve the public
interest in selecting a licensee. As the Commission said when it
selected the point system over other methodologies to resolve
application conflicts, favoring those who file first is not ``the
optimal way to select applicants who will provide 'diversity and
excellence' in educational
[[Page 12277]]
broadcasting to the public.'' Accordingly, we decline to award points
to the successful proponent of a reservation showing.
D. Miscellaneous Issues
18. MMTC Pleadings Withdrawn. On June 16, 2003, MMTC filed a
petition for reconsideration of the Second Report & Order, seeking
changes in the eligibility requirements for the new entrant bidding
credit used in broadcast auctions. In its petition, MMTC specifically
requested that applicants in FM Auction No. 37 ``immediately'' report
changes that cause a loss of, or reduction in, eligibility for a new
entrant bidding credit. The Commission subsequently established such a
requirement in FM Auction No. 37, and, as a result, MMTC withdrew its
petition for reconsideration by a letter dated October 19, 2004.
Accordingly, this matter is no longer before the Commission in this
proceeding.
19. Licenses Formerly Held by Michael Rice-Controlled Entities. By
Public Notice, 16 FCC Rcd 12832, released July 3, 2001, the Media
Bureau and the Wireless Telecommunications Bureau collectively gave
notice of filing procedures for applications for interim and permanent
authority to operate the two AM (Rice AM Stations) and five FM stations
(Rice FM Stations) (collectively, the Rice Stations) formerly licensed
to entities controlled by Michael Rice. Because the filing window for
AM Auction No. 32 had been completed, the Rice Public Notice announced
a supplemental AM Auction No. 32 filing window for the Rice AM
Stations. Seven entities timely filed applications for the AM facility
at 640 KHz, Terre Haute, IN; six entities timely filed applications for
the AM facility at 1230 KHz, Terre Haute, IN. One of the entities
applying for both of the Rice AM stations, Word Power, Inc., indicated
that it was applying for NCE stations. The Rice Public Notice also
announced that the now-vacant allotments for the Rice FM Stations would
be included in FM Auction No. 37 and interested parties could file Form
175 applications in the then-upcoming auction filing window. The
allotments for the five Rice FM Stations were also included in the
Public Notice, described supra, listing 500 vacant FM allotments for
which NCE reservation showings could be filed. Four of the five Rice FM
Station allotments received reservation showings.
20. University of Missouri now expresses concern about the impact
of the Second Report & Order on the licenses for the Rice Stations and,
in particular, the Channel 252C2 allotment in Columbia, Missouri--
formerly licensed as KFMZ-FM. University of Missouri asks us to clarify
whether the policies and rules established in the Second Report & Order
apply to interim licensing for this channel. University of Missouri
also contends that it should have an opportunity to reserve this
channel for exclusive NCE use according to the criteria discussed in
the Second Report & Order. Ultimately, University of Missouri suggests,
the Commission should adopt unique procedures to license KFMZ-FM to
avoid the litigation that it anticipates will result from the
allotment's auction.
21. As previously discussed, the Media Bureau opened a window to
permit interested parties an opportunity to reserve any of
approximately 500 vacant FM allotments. Channel 252C2 in Columbia,
Missouri was among these FM allotments, as were the four other FM
channels previously used by Mr. Rice. University of Missouri, in fact,
filed a reservation showing for the FM channel it seeks. Thus, insofar
as it seeks this opportunity in its petition, the issue is now moot. To
the extent University of Missouri seeks a non-auction mechanism to
award a license for the channel on a permanent basis, we see no grounds
for doing so. We find unpersuasive University of Missouri's argument
that ineligible parties may attempt to acquire the license, and that
such efforts will result in time-consuming litigation. This possibility
applies to all broadcast auctions. A petitioner may raise such
arguments post-auction when a prevailing applicant's long-form
application is filed. Thus, this concern is insufficient to overcome
the clear imperative of section 309(j) of the Act.
22. Applications filed in the supplemental AM Auction No. 32 filing
window for the two Rice AM Stations also predated the release of the
Second Report & Order. As a result of the Second Report & Order, any of
the applications for NCE stations filed during this window that are
mutually exclusive with applications for commercial stations are to be
dismissed. The application of Word Power, Inc. was the only application
for an NCE station. We, therefore, offer Word Power, Inc. the same
relief offered to the applicants for NCE stations in mixed groups,
discussed above, and will afford it the same time-limited opportunity
to amend its application(s) to apply for commercial stations, in
accordance with the procedures set forth above. After this limited
amendment opportunity, all remaining mutually exclusive applications
for commercial stations for the Rice AM Stations will proceed to
auction.
IV. Conclusion
23. In this Memorandum Opinion & Third Order on Reconsideration, we
reaffirm all decisions in the Second Report & Order, except that we
will now permit parties with applications for NCE stations on non-
reserved channels in closed mixed groups that have been pending since
the date of the Second Report & Order, and were then mutually exclusive
with applications for commercial stations, a one-time opportunity to
amend their applications. We believe that reaffirmation of our earlier
conclusions, subject to this change, best serves the public interest.
V. Procedural Matters
24. Accessibility Information. To request information in accessible
formats (computer diskettes, large print, audio recording, and
Braille), send an e-mail to fcc504@fcc.gov or call the FCC's Consumer
and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-
0432 (TTY). This document can also be downloaded in Word and Portable
Document Format (PDF) at: https://www.fcc.gov.
25. Final Paperwork Reduction Act Analysis. This Memorandum Opinion
& Third Order on Reconsideration contains no new or modified
information collections subject to the Paperwork Reduction Act of 1995,
Public Law 104-13, 109 Stat. 163 (1995) (codified in Chapter 35 of
Title 44 U.S.C.). In addition, therefore, it does not contain any new
or modified ``information collection burden for small business concerns
with fewer than 25 employees,'' pursuant to the Small Business
Paperwork Relief Act of 2002, Public Law 107-198, 116 Stat. 729 (2002)
(codified in Chapter 35 of title 44 U.S.C.); see 44 U.S.C. 3506(c)(4).
26. Supplemental Final Regulatory Flexibility Analysis. As required
by the Regulatory Flexibility Act of 1980, 5 U.S.C. 603, as amended by
the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA), Public Law 104-121, 110 Stat. 847 (1996), an Initial
Regulatory Flexibility Analysis (IRFA) was incorporated in the Second
Further Notice. The Commission sought written public comment on the
proposals in the Second Further Notice, including comment on the IRFA.
No comments addressed the IRFA. A Final Regulatory Flexibility Analysis
(FRFA) was published in the Second Report & Order. This present
Supplemental FRFA, which conforms to the RFA, supplements that FRFA. We
note that
[[Page 12278]]
the Supplemental FRFA addresses only the matters considered on
reconsideration in the Memorandum Opinion & Third Order on
Reconsideration. Therefore, this Supplemental FRFA addresses only the
one decision reversed from the Second Report & Order.
A. Need for, and Objectives of, the Memorandum Opinion & Third Order on
Reconsideration
27. The Commission adopts this Memorandum Opinion & Third Order on
Reconsideration to reaffirm its earlier conclusions in the Second
Report & Order, except for one decision. In the Second Report & Order,
the Commission decided to dismiss a discrete group of applicants for
NCE stations for non-reserved channels that were mutually exclusive
with applications for commercial stations without providing these
applicants an opportunity to avoid dismissal by amending their
applications to change their status from NCE to commercial. This
discrete group of long-pending applications for NCE stations consists
of approximately 19 mixed groups of mutually exclusive applications for
non-reserved channels filed between 1994 and 1997; these include 13 FM
mixed groups, two FM translator mixed groups, and four TV mixed groups.
On reconsideration, the Commission will now afford each of these
applicants a one-time opportunity to amend their applications to apply
for a commercial broadcast station before dismissing these
applications. The Commission is persuaded that the unfairness of
immediate dismissal to this discrete group of long-pending applications
for NCE stations outweighs any delay to those applicants for commercial
stations that are mutually exclusive with these applicants. Unlike
prospective applicants for NCE stations, these applicants for NCE
stations in the mixed groups sought to be licensed as NCE stations
before adoption of the Second Report & Order and thus without knowledge
of the consequences of this decision. Moreover, the Commission finds
that it can expeditiously afford mixed group applicants for NCE
stations a one-time opportunity to amend their pending applications to
apply for a commercial station, while avoiding unnecessary delay to the
pending commercial applicants, which initially dissuaded the Commission
from providing such an opportunity.
B. Summary of Significant Issues Raised by the Public in Responses to
the IRFA
28. No comments addressed the IRFA, or otherwise discussed issues
that may impact small entities.
C. Description and Estimate of the Number of Small Entities To Which
the Rules Will Apply
29. The RFA directs the Commission to provide a description of,
and, where feasible, an estimate of the number of small entities that
will be affected by the rules. The RFA defines the term ``small
entity'' as having the same meaning as ``small business,'' ``small
organization,'' and ``small governmental jurisdiction.'' In addition,
the term ``small business'' has the same meaning as the term ``small
business concern'' under the Small Business Act. A ``small business
concern'' is one that: (1) Is independently owned and operated; (2) is
not dominant in its field of operation; and (3) satisfies any
additional criteria established by the SBA.
30. The decision adopted in this Memorandum Opinion & Third Order
on Reconsideration will affect only (1) the discrete group of
applicants for NCE stations for non-reserved channels and (2) those
applicants for commercial stations that are mutually exclusive with
these NCE applicants. These groups may include small businesses, and
were included in the description and estimate of small entities in the
FRFA to the Second Report & Order.
31. Radio. The applicants affected by this new decision may include
existing radio stations. SBA defines as a small business those radio
broadcasting stations that have no more than $7.0 million in annual
receipts. The Commission has estimated the number of licensed radio
stations to be 13,837, of which 4,754 are AM stations, 6,266 are
commercial FM stations, and 2,817 are NCE FM stations. According to
Commission staff review of the BIA Financial Network, MAPro Television
Database (BIA) of March 30, 2007, about 10,420 commercial radio
stations (or about 95 percent) of an estimated 11,000 commercial radio
stations have revenue of $7.0 million or less. Many commercial radio
stations, however, are affiliated with larger corporations with higher
revenue, with the result that the estimated number of commercial radio
stations overstates the number that qualify as small entities. The
Commission does not compile and otherwise does not have access to
information on the revenue of NCE stations that would permit it to
determine how many such stations would qualify as small entities.
32. Television. The applicants affected by this new decision may
also include TV stations. The SBA defines a television broadcast
station as a small business if such station has no more than $14.0
million in annual receipts. Business concerns included in this industry
are those ``primarily engaged in broadcasting images together with
sound.'' The Commission has estimated the number of licensed commercial
television stations to be 1,376. According to Commission staff review
of the BIA Financial Network, MAPro Television Database (BIA) on March
30, 2007, about 986 of an estimated 1,374 commercial television
stations (or about 72 percent) have revenues of $14.0 million or less
and thus qualify as small entities under the SBA definition. The
Commission has estimated the number of licensed NCE television stations
to be 380. We note, however, that, in assessing whether a business
concern qualifies as small under the above definition, business
(control) affiliations must be included. Our estimate, therefore,
likely overstates the number of small entities that might be affected
by our action, because the revenue figure on which it is based does not
include or aggregate revenues from affiliated companies. The Commission
does not compile and otherwise does not have access to information on
the revenue of NCE stations that would permit it to determine how many
such stations would qualify as small entities.
33. In addition, an element of the definition of ``small business''
is that the entity not be dominant in its field of operation. We are
unable at this time to define or quantify the criteria that would
establish whether a specific television station is dominant in its
field of operation. Accordingly, the estimate of small businesses to
which rules may apply do not exclude any television station from the
definition of a small business on this basis and are therefore over-
inclusive to that extent. Also as noted, an additional element of the
definition of ``small business'' is that the entity must be
independently owned and operated. We note that it is difficult at times
to assess these criteria in the context of media entities and our
estimates of small businesses to which they apply may be over-inclusive
to this extent.
D. Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements
34. The decision adopted in this Memorandum Opinion & Third Order
on Reconsideration will not result in a change in the existing
compliance, reporting and recordkeeping
[[Page 12279]]
requirements, except with respect to the discrete group of applicants
for NCE stations that were previously dismissed in the Second Report &
Order because they were mutually exclusive with applications for
commercial stations. As a result of this Order, the discrete group of
applicants for NCE stations is being permitted a one-time opportunity
to file an amendment to their applications to change their status from
NCE to commercial, and thereby avoid dismissal of their applications.
E. Steps Taken To Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
35. The RFA requires an agency to describe any significant
alternatives that it has considered in adopting its rules, which may
include the following four alternatives (among others): (1) The
establishment of differing compliance or reporting requirements or
timetables that take into account the resources available to small
entities; (2) the clarification, consolidation, or simplification of
compliance or reporting requirements under the rule for small entities;
(3) the use of performance, rather than design, standards; and (4) an
exemption from coverage of the rule, or any part thereof, for small
entities.
36. On reconsideration, the Commission determined it has two
choices: (1) Reaffirm its decision in the Second Report & Order to
immediately dismiss this discrete group of applicants for NCE stations
or (2) give these applicants an opportunity to amend their applications
to change their status from NCE to commercial, and thus avoid
dismissal. In the Second Report & Order, we were not persuaded that the
equities favoring the applicants for NCE stations outweighed the delay
in initiating new broadcast service to the public as well as the
unfairness to applicants for commercial stations. But we now believe
that the unfairness of immediate dismissal to this discrete group of
applicants for NCE stations outweighs any delay or unfairness to those
applicants for commercial stations that are mutually exclusive with
these applicants. Unlike future applicants for NCE stations, these
applicants for NCE stations in the mixed groups sought to be licensed
as an NCE station before adoption of the Second Report & Order and thus
without full knowledge of the consequences of this decision. Moreover,
we now believe that we can expeditiously afford applicants with pending
applications a one-time opportunity to amend their applications to
apply for a commercial station yet will avoid the delay and unfairness
to applicants for commercial stations that initially dissuaded us from
providing such an opportunity. After this filing opportunity, any
application for an NCE station that remains mutually exclusive with any
application for a commercial station will be dismissed with prejudice,
in accordance with Sec. 73.5002(b) of the rules. There will be no
additional opportunity for applicants in these pending, closed mixed
groups to further amend their long-form applications. We believe that
this processing policy will provide fairer treatment to pending
applicants and better serve the public interest. It will give
applicants for NCE stations one opportunity to reevaluate their long-
pending plans in the context of full and complete information about how
the licensing process will work and, as designed, it should not
appreciably delay the introduction of new service. This approach will
avoid the extremely harsh result of dismissing applicants based on
subsequently adopted processing rules in a manner that is consistent
with our statutory commercial and NCE licensing schemes.
37. Furthermore, our new decision will benefit the applicants for
NCE stations that are small businesses by allowing them a chance to
compete for licenses. While some of the applicants for commercial
stations that are small businesses may be harmed by facing increased
competition for licenses, the harm to these entities would not be as
great as that to those small businesses applicants for NCE stations
that would face dismissal of their applications. In addition, the
public is better served by this enhanced competition.
F. Report to Congress
38. The Commission will send a copy of this Memorandum Opinion &
Third Order on Reconsideration, including this FRFA, in a report to be
sent to Congress pursuant to the Congressional Review Act. In addition,
the Commission will send a copy of this Memorandum Opinion & Third
Order on Reconsideration, including this FRFA, to the Chief Counsel for
Advocacy of the Small Business Administration. A copy of this
Memorandum Opinion & Third Order on Reconsideration and this FRFA (or
summaries thereof) will also be published in the Federal Register.
39. Additional Information. For additional information, please
contact Evan Baranoff, Media Bureau, Policy Division, (202) 418-2120,
or Evan.Baranoff@fcc.gov.
VI. Ordering Clauses
40. Accordingly, it is ordered that, pursuant to the authority
contained in sections 1, 2(a), 4(i), 303, 307, 309 and 405(a) of the
Communications Act, as amended, 47 U.S.C. 151, 152(a), 154(i), 303,
307, 309 and 405(a), and Sec. 1.429 of the Commission's rules, 47 CFR
1.429, that the petitions for reconsideration filed by the parties
listed in Appendix A are granted in part and denied in part as
indicated above, and that this Memorandum Opinion & Third Order on
Reconsideration is adopted.
41. It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of this Memorandum Opinion & Third Order on Reconsideration,
including the Final Regulatory Flexibility Analysis, to the Chief
Counsel for Advocacy of the Small Business Administration.
42. It is further ordered that this proceeding is terminated.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. E9-6432 Filed 3-23-09; 8:45 am]
BILLING CODE 6712-01-P