Promoting Diversification of Ownership in the Broadcasting Services, 19431-19461 [2016-04838]
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Vol. 81
Monday,
No. 64
April 4, 2016
Part V
Federal Communications Commission
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47 CFR Parts 73 and 74
Promoting Diversification of Ownership in the Broadcasting Services; Final
Rule
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Federal Register / Vol. 81, No. 64 / Monday, April 4, 2016 / Rules and Regulations
FEDERAL COMMUNICATIONS
COMMISSION
47 CFR Parts 73 and 74
[MB Docket Nos. 07–294, 10–103, MD
Docket No. 10–234; FCC 16–1]
Promoting Diversification of
Ownership in the Broadcasting
Services
Federal Communications
Commission.
ACTION: Final rule.
AGENCY:
In this document, the
Commission refines the collection of
data reported on FCC Form 323,
Ownership Report for Commercial
Broadcast Stations, and FCC Form 323–
E, Ownership Report for
Noncommercial Broadcast Stations.
Specifically, the Commission
implements a Restricted Use FRN
(RUFRN) within the Commission’s
Registration System (CORES) that
individuals may use solely for the
purpose of broadcast ownership report
filings; eliminates the availability of the
Special Use FRN (SUFRN) for broadcast
station ownership reports, except in
very limited circumstances; prescribes
revisions to Form 323–E that conform
reporting for noncommercial
educational (NCE) broadcast stations
more closely to those for commercial
stations; and makes a number of
significant changes to its reporting
requirements that reduce the filing
burdens on broadcasters, streamline the
process, and improve data quality.
These enhancements will enable the
Commission to obtain data reflecting a
more useful, accurate, and thorough
assessment of minority and female
broadcast station ownership in the
United States while reducing certain
filing burdens.
DATES: Effective May 4, 2016 The
amendments to §§ 73.3615 and 74.797
contain new or revised information
collection requirements that are not
effective until approved by the Office of
Management and Budget (OMB). The
Commission will publish a document in
the Federal Register announcing the
effective date of these changes. A
separate notice will be published in the
Federal Register soliciting public and
agency comments on the information
collections and establishing a deadline
for accepting such comments.
FOR FURTHER INFORMATION CONTACT: Jake
Riehm, Industry Analysis Division,
Media Bureau, FCC, (202) 418–2330. For
additional information concerning the
information collection requirements
contained in the Report and Order,
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SUMMARY:
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contact Cathy Williams at (202) 418–
2918, or via the Internet at PRA@fcc.gov.
SUPPLEMENTARY INFORMATION: This is a
summary of the Commission’s Report
and Order, Second Report and Order,
and Order on Reconsideration (Second
Report and Order) in MB Docket Nos.
07–294, 10–103, and MD Docket Nos.
10–234; FCC 16–1, adopted January 8,
2016, and released January 20, 2016.
The complete text of this document is
available electronically in ASCII,
Microsoft Word, and PDF formats via
the search function on the FCC’s
Electronic Document Management
System (EDOCS) Web page at https://
apps.fcc.gov/edocs_public/. The
document is also available
electronically via the FCC’s Electronic
Comment Filing System (ECFS) Web
page at https://apps.fcc.gov/ecfs/. In
addition, the complete document is
available for inspection and copying
during regular business hours in the
FCC Reference Information Center, 445
12th Street SW., Room CY–A257,
Washington, DC 20554. To request
materials in accessible formats for
people with disabilities (Braille, large
print, electronic files, audio format),
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).
Final Paperwork Reduction Act of 1995
Analysis
This document contains information
collection requirements subject to the
Paperwork Reduction Act of 1995
(PRA), Public Law 104–13. The
requirements will be submitted to the
Office of Management and Budget
(OMB) for review under section 3507(d)
of the PRA. OMB, the general public,
and other Federal agencies will be
invited to comment on the information
collection requirements contained in
this proceeding. The Commission will
publish a separate document in the
Federal Register at a later date seeking
these comments. In addition, the
Commission notes that pursuant to the
Small Business Paperwork Relief Act of
2002, Public Law 107–198, see 44 U.S.C.
3506(c)(4), the Commission seeks
specific comment on how it might
‘‘further reduce the information
collection burden for small business
concerns with fewer than 25
employees.’’
Synopsis
I. Introduction
1. The Commission has a longstanding goal of promoting diversity in
ownership of broadcast stations to
ensure that diverse viewpoints and
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perspectives are available to the
American people in the content they
receive over the broadcast airwaves. In
pursuit of this goal, the Commission has
a long history of promulgating rules and
regulations designed to foster diversity
in terms of minority and female
ownership in particular. In this Report
and Order, Second Report and Order,
and Order on Reconsideration (Report
and Order), the Commission acts to
improve the data available to analyze
issues relevant to ownership and
viewpoint diversity by refining the
collection of data reported on FCC Form
323, Ownership Report for Commercial
Broadcast Stations, and FCC Form 323–
E, Ownership Report for
Noncommercial Broadcast Stations.
2. A necessary precursor to the
Commission’s policy-making efforts in
this area is the collection of
comprehensive, reliable data reflecting
the race, gender, and ethnicity of the
owners and other interest holders in
broadcast stations. Such data are
essential to effectively study and
analyze ownership trends, to assess the
impact of Commission rules, and to
provide a foundation for the adoption of
new rules, among other things. To be
useful for this purpose, to the greatest
extent possible the data must be capable
of being read, verified, searched,
aggregated, and cross-referenced
electronically. Moreover, for the
Commission’s broadcast ownership data
to be complete, reliable, and usable for
study and analysis, individuals reported
on Forms 323 and 323–E must be
uniquely identified. The enhancements
described herein enable the Commission
to obtain data reflecting a more useful,
accurate, and thorough assessment of
minority and female broadcast station
ownership in the United States while
reducing certain filing burdens. These
improvements also address the directive
from the U.S. Court of Appeals for the
Third Circuit that the Commission
obtain more and better data concerning
broadcast ownership to support its
rulemaking decisions.1 Ultimately, the
Commission believes that these actions
will assist its future initiatives to
promote diverse ownership.
3. Accordingly, pursuant to the
Commission’s statutory mandate
contained in section 257 of the
Telecommunications Act of 1996 (the
1996 Act) and section 309(j) of the
Communications Act of 1934 (the Act)
to promote opportunities for small
businesses and women and minorities
in the broadcasting industry, the
Commission implements a Restricted
1 See Prometheus Radio Project v. FCC, 652 F.3d
431, 469, 471–72 (3d. Cir. 2011) (Prometheus II).
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Use FRN (RUFRN) within the
Commission’s Registration System
(CORES) that individuals may use solely
for the purpose of broadcast ownership
report filings. The Commission believes
that the RUFRN will allow for sufficient
unique identification of individuals
listed on broadcast ownership reports
without necessitating the disclosure to
the Commission of individuals’ full
Social Security Numbers (SSNs). In light
of the Commission’s adoption of the
RUFRN requirement, the Commission
eliminates the availability of the Special
Use FRN (SUFRN) for broadcast station
ownership reports, except in very
limited circumstances as further
described herein. The Commission also
prescribes revisions to Form 323–E that
conform reporting for noncommercial
educational (NCE) broadcast stations
more closely to those for commercial
stations, including information about
race, gender, and ethnicity of existing,
reportable attributable interest holders;
the use of a unique identifier; and the
biennial filing requirement. Finally, the
Commission makes a number of
significant changes to its reporting
requirements that reduce the filing
burdens on broadcasters, streamline the
process, and improve data quality.
These changes include extending the
biennial filing deadline, reducing the
number of filings required, improving
the reporting of other broadcast and
newspaper interests, and other
modifications.
II. Background
4. The Commission has been engaged
in a sustained effort to improve the
quality, utility, and reliability of its
broadcast ownership data. In 2009, the
Commission substantially revised the
biennial Form 323 to facilitate
longitudinal comparative studies of
broadcast station ownership. The
changes also addressed flaws in the data
collection process identified by the
United States Government
Accountability Office (GAO) and by
researchers who had attempted to use
the data submitted on previous versions
of Form 323. GAO cited several
shortcomings with the Commission’s
data collection process: (1) Exemptions
from the biennial filing requirement for
certain types of broadcast stations; (2)
inadequate data quality procedures; and
(3) problems with storage and retrieval.
GAO noted that ‘‘more accurate,
complete, and reliable [broadcast
ownership] data would allow FCC to
better assess the impact of its rules and
regulations and allow the Congress to
make more informed legislative
decisions,’’ and it ‘‘recommend[ed] that
FCC take steps to improve the reliability
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and accessibility of its data on the
gender, race, and ethnicity of broadcast
outlet owners.’’ 2
5. To improve the quality of its
broadcast ownership data, the
Commission adopted several significant
changes to Form 323 in the 323 Order,
74 FR 25163, May 27, 2009, FCC 09–33,
rel. May 5, 2009. First, it set a uniform
‘‘as of’’ date of October 1 for the
ownership data being reported in the
biennial filing and established a
uniform filing deadline of November 1,
requiring all filers to report their
ownership interests as they exist on the
‘‘as of’’ date of the filing year and to
submit their reports no later than one
month thereafter. These uniform dates
make it possible to discern statistically
valid trends in minority and female
broadcast ownership over time, which
was not possible using the previous
rolling filing deadlines, and to ensure
the timely collection of the data. The
Commission expanded the requirement
to file Form 323 biennially to include
sole proprietors and partnerships of
natural persons, as well as low power
television (LPTV) and Class A licensees.
6. In the 323 Order, the Commission
also concluded that an FRN should be
reported for each interest holder
reported on Form 323 and directed staff
to revise Form 323 accordingly. The
Commission delegated authority to staff
to revisit the CORES FRN issue if
additional changes to the form were
necessary. In order ‘‘to further improve
the ability of researchers and other users
of the data to cross-reference
information and construct ownership
structures,’’ the Media Bureau revised
Form 323 to require that an FRN be
reported for every interest holder
reported on the form.3 The Bureau also
revised the instructions and questions
in Form 323 to (1) clarify the
information sought in the form; (2)
ensure that the data are collected in
machine-readable formats that can be
imported into programs used to prepare
economic and policy studies; and (3)
simplify completion of the form by
giving respondents menu or checkbox
options to enter data. The Bureau
included built-in checks and pre-fill
capabilities to assure greater accuracy of
the data reported and ease of
completion of the form.
7. Accompanying the 323 Order was
a Fourth Diversity Further Notice, 74 FR
25205, May 27, 2009, FCC 09–33, rel.
May 5, 2009, in which the Commission
2 U.S. Gov’t Accountability Office, GAO–08–383,
Media Ownership: Economic Factors Influence the
Number of Media Outlets in Local Markets, While
Ownership by Minorities and Women Appears
Limited and is Difficult to Assess, at 5 (2008).
3 323 Order, 74 FR at 25165.
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sought comments on changes to Form
323–E. The Commission sought
comment on whether to seek race,
gender, and ethnicity data from persons
reported on Form 323–E in order to
obtain data that would further the
Commission’s goal to advance diversity
in the broadcast industry. Noting that
many NCE broadcast station licensees
are non-profit, non-stock entities or
governmental organizations that are
controlled by governing boards
comprising members without a financial
stake in the broadcast station, the
Commission sought comment on how to
define ownership in the noncommercial
context. Among other things, the Fourth
Diversity Further Notice sought
comment on whether the Commission
should adopt the same or similar
modifications for Form 323–E as it did
for Form 323 in the 323 Order and
whether the data quality measures
adopted in the 323 Order would be
appropriate and sufficient to ensure that
the data collected by Form 323–E are
aggregable. The Fourth Diversity Further
Notice also sought comment on whether
to require low power FM (LPFM)
stations to file a Form 323–E to collect
ownership data on the licensees or to
continue to exempt LPFM licensees
from the filing requirements. The
Commission will address issues in the
Fourth Diversity Further Notice related
to LPFM in a future order. The Fourth
Diversity Further Notice was published
in the Federal Register on May 27,
2009, with comments due on or before
June 26, 2009, and reply comments due
on or before July 13, 2009.
8. On August 11, 2009, the
Commission submitted a revised Form
323 to the Office of Management and
Budget (OMB) for approval pursuant to
the Paperwork Reduction Act (PRA)
requirements and published the Federal
Register notice initiating a 60-day
comment period.4 Among the changes
submitted was a requirement that each
filer provide a CORES FRN for each
reported attributable interest holder.
Form 323 requires Respondents to list
each of the officers, directors,
stockholders, non-insulated partners,
members and other persons or entities
with a direct attributable interest in the
Respondent. Many comments submitted
to OMB objected to the revision
requiring filers to report CORES FRNs
for individuals holding attributable
interests, arguing that it required them
to provide SSNs to the Commission,
which they claimed triggered privacy,
data security, and identity theft
4 Public Information Collection Requirement
Submitted to OMB for Review and Approval,
Comments Requested, 74 FR 40,188 (Aug. 11, 2009).
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concerns. Commenters also suggested
that obtaining CORES FRNs for
reportable individuals would be
burdensome, and that in some cases
filers might not be able to obtain the
CORES FRN for all individual
attributable interest holders because
individuals might be unwilling either to
obtain CORES FRNs for themselves or to
provide their SSNs to the filer for the
purpose of obtaining CORES FRNs on
their behalf. Two Petitions for Writs of
Mandamus were filed with the U.S.
Court of Appeals for the DC Circuit to
stay the Commission’s implementation
of the revisions to Form 323. The law
firm of Fletcher, Heald & Hildreth,
P.L.C., on behalf of itself and various
state broadcaster association clients,
filed the first Petition on December 23,
2009, Doc. No. 09–1321, and the second
Petition on May 28, 2010, Doc. No. 10–
1117. Both were denied.
9. On October 6, 2009, the Office of
the Managing Director (OMD) at the
Commission submitted a letter to OMB
addressing the comments filed in
response to the revised Form 323. OMD
explained that requiring CORES FRNs
on Form 323 is an integral part of the
Commission’s effort to improve the
quality, reliability, and usability of the
collected data by eliminating
inconsistencies and inadequacies in the
data submitted. The Reply Letter
rejected allegations that the Commission
failed to comply with the notice
requirements of the PRA or ran afoul of
the Privacy Act. OMD also disputed
commenters’ objections that the CORES
FRN requirement raised security and
identity theft concerns. The
Commission utilizes a ‘‘robust security
architecture . . . for CORES that
exceeds Federal guidelines and
recommendations’’ and has deployed
operational controls that comply with
National Institute of Standards and
Technology guidance.5 OMD stated that
the Commission’s servers are securely
located, that its databases are behind
several firewalls, and that all servers
and communications are monitored.
The Reply Letter also noted that
administrative access to the CORES
application is limited and that all
transmission of non-public data is
encrypted.
10. The 323 Order also directed staff
to modify Form 323 to require those
interest holders that would be
attributable but for the single majority
shareholder exemption and the
exemption for interests held in eligible
entities pursuant to the higher Equity/
5 Letter from Walter Boswell, Acting Assoc.
Managing Director, PERM, OMD, FCC, to Nicholas
A. Fraser, OMB, at 9 (Oct. 6, 2009).
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Debt Plus (EDP) thresholds adopted in
the Diversity Order to be reported on the
form. On October 15, 2009, the
Commission addressed a petition for
reconsideration, in which the National
Association of Broadcasters (NAB)
argued, inter alia, for reconsideration of
elements of the 323 Order regarding the
collection of information of certain
nonattributable interest holders on Form
323. In an opposition to NAB’s petition
for reconsideration, the Office of the
United Church of Christ, Inc. (UCC),
Benton Foundation, Common Cause,
Media Alliance, and National
Organization of Women Foundation
(collectively, UCC et al.), supported the
Commission’s decision to collect
ownership information from certain
nonattributable interest holders. NAB
disagreed on reply. Acknowledging that
the Commission had not explicitly
expressed its intention to require certain
nonattributable interest holders to file
information in its rulemaking notice, the
Commission deleted the reporting
requirements for the nonattributable
interest holders and adopted the Fifth
Diversity Further Notice, 78 FR 2934,
Jan. 15, 2013, FCC 09–92, rel. Oct. 16,
2009. The Fifth Diversity Further Notice,
released on October 16, 2009, proposed
to collect ownership information from
interest holders in a licensee that would
be attributable but for the single
majority shareholder exemption and
those that would be attributable but for
the higher EDP thresholds adopted in
the Diversity Order. In the Sixth
Diversity Further Notice, 78 FR 2925,
Jan. 15, 2013, FCC 12–166, rel. Jan 3,
2013, the Commission sought comment,
inter alia, on extending the CORES FRN
requirement to those nonattributable
interests described in the Fifth Diversity
Further Notice in the event that the
Commission requires that these interests
be reported on Form 323. The
Commission will address issues raised
by and implicating proposals in the
Fifth Diversity Further Notice in a future
order.
11. On October 19, 2009, OMB
approved the revised Form 323, which
included the requirement that filers
provide a CORES FRN for individuals
holding an attributable interest in the
licensee. On October 16, 2009, the
Commission sent a subsequent letter to
OMB acknowledging the Commission’s
action in the 323 MO&O, 74 FR 56131,
Oct. 30, 2009, FCC 09–92, rel. Oct. 16,
2009, to eliminate the reporting of
certain nonattributable interest holders.
After several delayed filing deadlines,
the Commission set July 8, 2010 as the
first biennial filing deadline using the
revised Form 323. In response to
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industry concerns about filers’ ability to
obtain CORES FRNs from all individual
interest holders due to individuals’
concerns about privacy, security, and
identity theft, the Media Bureau allowed
filers, as an interim measure, to obtain
an SUFRN for individuals (but not
entities) reported on the form in lieu of
obtaining a CORES FRN. When clicking
a button on the electronic version of
Form 323 to generate an SUFRN, filers
were advised via a pop-up box that ‘‘[i]f,
after using diligent and good-faith
efforts,’’ a filer is unable to obtain an
SSN from an individual that must be
reported on Form 323 in order to
generate a CORES FRN, the filer may
elect to automatically generate in the
electronic Form 323 an SUFRN for that
individual. The respondents were also
informed that those who use an SUFRN
on Form 323 would be deemed to be
fully compliant with the filing
obligations and the lack of a CORESbased FRN would not subject a filer to
enforcement action. SUFRNs were
available to filers for the 2009, 2011,
and 2013 biennial filing periods. Filers
were directed that SUFRNs, like
CORES-based FRNs, must be used
consistently.
12. In November 2009, Koerner &
Olender, P.C., and Fletcher, Heald &
Hildreth, P.L.C., filed petitions seeking
reconsideration of the requirement to
obtain CORES FRNs for individuals
holding attributable interests, arguing
that the CORES FRN requirement is
overly burdensome and raises privacy
and data security issues and that the
Commission provided inadequate notice
of the CORES FRN requirement. In the
Sixth Diversity Further Notice, the
Commission addressed petitioners’
concerns for adequate notice of the
CORES FRN requirement for individuals
and sought comment on Koerner &
Olender’s request to ‘‘redefine or
reinterpret’’ section 1.8002 of the
Commission’s rules. This Report and
Order resolves the remaining issues
raised in these petitions for
reconsideration.
13. In June 2010, the Media Bureau
initiated the Review of Media Bureau
Data Practices proceeding to examine
the Bureau’s data practices to improve
the way the Commission collects, uses
and disseminates data. The Bureau
solicited input concerning potential
improvements to all of its existing data
collections, including both the biennial
and non-biennial sections of Forms 323
and 323–E. The Bureau defined ‘‘data
collection’’ in ‘‘the broadest manner
possible, to include all information
collections approved by the Office of
Management and Budget under the
Paperwork Reduction Act, including
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data that the Commission formally
requires to be submitted and all
information that must be retained by
parties or disclosed to others.’’ Forms
323 and 323–E were included in the
inventory of data collections linked in
the item. Among other things, the
Bureau asked whether its various data
collections should be continued or
eliminated; whether the Bureau should
collect additional data and for what
purpose(s); how the Bureau’s data
collections could be improved; what
burdens exist for the Commission,
industry, and the public; and what
potential improvements could be made
concerning public access to, and
Commission dissemination of,
submitted data. The Commission
received numerous comments in this
proceeding, including two
submissions—from NAB and the
Minority Media and
Telecommunications Council
(MMTC)—that addressed issues related
to the Commission’s broadcast
ownership report forms and data.
14. In December 2010, the
Commission initiated another separate
rulemaking proceeding in which it
proposed to update CORES to enhance
the Commission’s data collection efforts
and to improve customer interface with
CORES. In the CORES NPRM, 76 FR
5652, Feb. 1, 2011, FCC 10–192, rel.
Dec. 7, 2010, the Commission stated
that, ‘‘[s]ince the creation of CORES,
entities have been able to obtain
multiple FRNs in order to permit
different members of their corporate
family to obtain their own individual
FRNs, regardless of whether those
entities had different taxpayer
identification numbers (‘TINs’).’’ For
entities, the TIN is generally their
employer identification number (EIN),
and for individuals, the TIN is generally
their SSN. The Commission stated that
it has had difficulty using CORES to
identify all the FRNs an entity holds
when the entity has used inconsistent
TINs or did not provide a TIN to obtain
an FRN through CORES. The
Commission also observed that some
filers erroneously invoked exceptions to
the requirement to provide a TIN,
making those entities or individuals
difficult to track. The Commission
proposed several options to resolve
these issues. In addition, the
Commission asked whether it should
expand the availability of SUFRNs for
purposes other than the filing of Form
323.
15. In July 2011, the U.S. Court of
Appeals for the Third Circuit, as part of
its review of the Commission’s media
ownership rules, vacated and remanded
certain aspects of the Diversity Order, 73
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FR 28361, May 16, 2008, FCC 07–217,
rel. Mar. 5, 2008. The Third Circuit
concluded that the Commission’s
decision to adopt a revenue-based
eligible entity definition to facilitate
ownership diversity was arbitrary and
capricious because the Commission did
not show how such a definition
specifically would assist minorities and
women, who were among the intended
beneficiaries of the action. The court
also remanded each of the measures
adopted in the Diversity Order that
relied on the eligible entity definition.
The court found that the eligible entity
definition was not supported by ‘‘data
attempting to show a connection
between the definition chosen and the
goal of the measures adopted—
increasing ownership of minorities and
women,’’ stressing that regulations
seeking to increase ownership by
women and minorities must be based on
reliable data. The court stated that, ‘‘[a]t
a minimum, in adopting or modifying
its rules, the FCC must ‘examine the
relevant data and articulate a
satisfactory explanation for its action[,]
including a rational connection between
the facts found and the choice made.’’’
The court also made plain that, ‘‘[i]f the
Commission requires more and better
data . . . it must get the data.’’ The
court stated that the actions taken in the
323 Order and Fourth Diversity Further
Notice to reliably analyze minority and
female ownership ‘‘will, however, lay
necessary groundwork for the
Commission’s actions on remand.’’
16. On November 14, 2012, the Media
Bureau released the first electronic
analysis of commercial broadcast
ownership data submitted pursuant to
the revised biennial reporting
requirements for 2009 and 2011 (2012
323 Report). A subsequent report,
released by the Bureau on June 27, 2014
(2014 323 Report), contained an analysis
of the commercial broadcast ownership
data submitted during the 2013 filing
cycle. The data contained in the reports
are ‘‘snapshots’’ of the status of minority
and female ownership in the broadcast
industry and are part of a planned series
of biennial ‘‘snapshots’’ that can be used
for trend analysis. The reports contain
100 pages of summary schedules and 30
spreadsheets of underlying data
reflecting the Media Bureau’s analysis of
the Form 323 data, which can be further
studied and manipulated by researchers
and interested parties. Future, similar
reports are contemplated reflecting
additional biennial reporting periods.
These reports provide detailed
information by race, ethnicity, and
gender concerning ownership of
commercial television, radio, Class A
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television, and LPTV stations. For
example, the 2012 323 Report analyzed
data for 1,348 full-power commercial
television stations as of October 1, 2011.
Members of racial minorities held
majority voting interests in 30 stations,
or 2.2 percent. Female owners held
majority voting interests in 91 stations,
or 6.8 percent. The 2012 323 Report also
analyzed data for 5,611 commercial FM
stations as of October 1, 2011. Members
of racial minorities held majority voting
interests in 196 stations, or 3.5 percent,
and female owners held majority voting
interests in 323 stations, or 5.8 percent.
Similarly, the 2012 323 Report analyzed
data for 3,830 commercial AM stations
as of October 1, 2011. Members of racial
minorities held majority voting interests
in 237 stations, or 6.2 percent, and
female owners held majority voting
interests in 300 stations, or 7.8 percent.
The 2014 323 Report analyzed data for
1,386 full-power commercial television
stations as of October 1, 2013. Members
of racial minorities held majority voting
interests in 41, or 3.0 percent, of those
stations. Female owners held majority
voting interests in 87 stations, or 6.3
percent. The 2014 323 Report also
analyzed data for 5,714 commercial FM
stations as of October 1, 2013. Members
of racial minorities held majority voting
interests in 169, or 3.0 percent, of these
stations, and female owners held
majority voting interests in 383 stations,
or 6.7 percent. The 2014 323 Report also
analyzed data for 3,737 commercial AM
stations as of October 1, 2013. Members
of racial minorities held majority voting
interests in 225, or 6.0 percent, of these
stations, and female owners held
majority voting interests in 310 stations,
or 8.3 percent. In preparing these
reports, Commission staff observed
difficulties with, and errors within, the
broadcast ownership data submitted to
the Commission. Upon review of the
biennial ownership reports,
Commission staff discovered that many
commercial broadcast stations
submitted reports with apparently
inaccurate or insufficient data to permit
electronic calculation of voting
interests. As a result, such biennial
ownership reports were not included in
the Commission’s analysis. Commission
staff worked with numerous
broadcasters to correct errors contained
in their 2011 and 2013 biennial Form
323 filings via amendments, which
allowed stations covered by those
reports to be properly categorized for
the 2012 and 2014 323 Reports. In
addition, Commission staff manually
analyzed a large number of ownership
reports, together with other available
information, in order to assign certain
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stations to the appropriate categories
manually for purposes of the report. The
2012 323 Report stated that the
problems with the data stemmed, in
part, from the ‘‘complexity of the
information required to accurately file’’
the revised version of Form 323.
17. The Commission also sought
public comment on both reports. On
December 3, 2012, the Commission
issued a Public Notice in the 2010
Quadrennial Regulatory Review
proceeding offering parties the
opportunity to comment on the 2012
323 Report (2012 323 Report PN). The
2012 323 Report PN broadly sought
‘‘additional comment on data contained
in [the 2012 323 Report],’’ specifically
referencing the Commission’s efforts ‘‘to
improve its collection and analysis of
broadcast ownership information’’ and
make ‘‘improvements to the reliability
and utility of the data reported in FCC
Form 323.’’ Some commenters
responding to the 2012 323 Report PN
expressed concern that the incomplete
and inaccurate ownership data
submitted to the Commission render it
difficult to accurately track broadcast
ownership trends from 2009 and 2011.
One commenter suggested that the
manner in which the Commission
currently provides broadcast ownership
data from Form 323 to the public does
not meet the objective that such data be
capable of being electronically searched,
aggregated, or cross referenced. On June
27, 2014, the Bureau issued an Order as
part of the 2014 Quadrennial Regulatory
Review proceeding seeking comment on
the 2014 323 Report. Certain
commenters responding to the data
contained in the 2014 323 Report
acknowledged that the Commission has
taken steps to improve the quality of its
broadcast ownership data, but asserted
that the Commission should do more to
make its broadcast ownership data
easier to use, search, aggregate, and
cross reference electronically, for the
benefit of studies and analysis.
18. On January 3, 2013, the
Commission released its Sixth Diversity
Further Notice, in which it sought
comment on the Commission’s
requirement that licensees and other
entities filing Form 323 provide a
CORES FRN—which requires
submission of an SSN or TIN to the
Commission—for attributable
individuals. Noting that the CORES FRN
enables unique identification of
individuals, the Commission sought
comment on its proposal to eliminate
the interim SUFRN. The Commission
reasoned that SUFRNs do not provide a
reliable means of linking a reported
interest holder to a unique individual
and the continued use of the SUFRN
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undermines the Commission’s efforts to
‘‘accurately ascertain the nature and
extent of minority and female
ownership of broadcast properties.’’
Pointing out that the Third Circuit in
Prometheus II highlighted the
importance of reliable data to support
rulemaking initiatives, the Sixth
Diversity Further Notice asked for
comments on the importance of the
CORES FRN as a unique identifier for
increasing the quality, cross-referencing,
aggregability, and searchability of
broadcast station ownership data. In
discussing the considerations attendant
to requiring that attributable interest
holders submit an SSN to the
Commission, the Sixth Diversity Further
Notice noted that other governmental
agencies require SSNs ‘‘to ensure
program integrity and for statistical and
research purposes.’’ The Commission
invited comment on its tentative
conclusion that the Privacy Act does not
prohibit adoption of the CORES FRN
proposal and asked commenters to
discuss the degree of the risk to privacy
the proposal poses in the event that
commenters believe that the
requirement presents such a risk. The
Commission also noted that it has
already adopted a Privacy Act System of
Records Notice (SORN) for CORES and
with respect to the Form 323
requirement, which applies to any
personally identifiable information
required by Form 323 and CORES in
connection with the CORES FRN
registration process. The Sixth Diversity
Further Notice also sought comment on
whether the Commission should amend
section 1.8002 of the Commission’s
rules, which provides that persons
‘‘doing business’’ with the Commission
must obtain a CORES FRN. The
Commission also asked whether it
should continue to permit filers to use
the SUFRN in the event that reportable
individuals are unwilling to provide
their SSN to a third party or unwilling
to obtain and provide a CORES FRN.
The Commission also proposed to
extend the CORES FRN requirement to
all entities and individuals reported on
Form 323–E and invited comment on
potential costs and benefits associated
with that requirement. The Sixth
Diversity Further Notice proposed to
extend the filing deadline for broadcast
ownership reports to give filers an
additional 30 days. As noted above, the
Sixth Diversity Further Notice also
sought additional comment on
proposals regarding Form 323 submitted
in the Review of Media Bureau Data
Practices proceeding. The notice
specifically sought comment on certain
proposals NAB and MMTC submitted in
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that proceeding and sought input on the
costs and benefits associated with those
proposals. The Sixth Diversity Further
Notice was published in the Federal
Register on January 15, 2013. Comments
on the Sixth Diversity Further Notice
were due on or before February 14, 2013
and reply comments due on or before
March 1, 2013.
19. The Commission received
significant opposition in response to the
Sixth Diversity Further Notice’s
proposal that all attributable interest
holders submit an SSN to the
Commission in order to receive a
CORES FRN for use on broadcast
ownership reports. As a result, on
February 12, 2015, the Commission
released the Seventh Diversity Further
Notice, 80 FR 10442, Feb. 26, 2015, FCC
15–19, which proposed to implement a
new RUFRN—an identifier that would
not require the submission of an SSN to
the Commission—for use on Form 323
and Form 323–E filings. This proposal
reflected the Commission’s effort to
balance its goal of collecting reliable
ownership data with the privacy, data
security, and identity theft concerns of
those individuals with attributable
interests in broadcast stations. As an
alternative to the CORES FRN, the
proposed RUFRN would be generated
when an individual submits his or her
full name, residential address, date of
birth, and only the last four digits of the
individual’s SSN.
20. The Commission reiterated its
position that it must be able to uniquely
identify all parties, including
individuals, reported on broadcast
ownership reports and tentatively
concluded that the RUFRN ‘‘will
provide reasonable assurance of unique
identification’’ of attributable
individuals and is a superior method of
uniquely identifying individuals than
the existing SUFRN. The Commission
sought comment on what additional
information, if any, the Commission
could require to ensure that the data
collected on the ownership reports will
be reliable.
21. The Commission also
acknowledged that commenters to the
Sixth Diversity Further Notice argued
that a CORES FRN cannot serve as a
unique identifier, because multiple
FRNs could be associated with a single
TIN/SSN; an FRN may be associated
with no TIN/SSN or an incorrect one; or
outside groups do not have access to the
underlying TIN/SSN information. The
Seventh Diversity Further Notice stated
that, to guard against a single individual
obtaining multiple RUFRNs, ‘‘the
CORES system will be programmed to
verify that the submitted information is
complete and does not duplicate any
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information that is already associated
with an RUFRN in CORES.’’ In the
Seventh Diversity Further Notice, the
Commission acknowledged the privacy
and security concerns raised in the
Sixth Diversity Further Notice as it
related to the requirement that interest
holders submit an SSN, and reiterated
that its systems, including CORES, have
a security infrastructure in place that
exceeds Federal guidelines. The
Commission also sought comment on its
tentative conclusion that the Privacy
Act does not bar the adoption of the
RUFRN and its implementation on Form
323 and Form 323–E. Moreover, the
Commission noted that it has already
adopted a Privacy Act SORN for CORES
and with respect to the Form 323
requirement, and, if necessary, the
SORN can be modified to address any
changes required by the implementation
of the RUFRN on Form 323 and Form
323–E. The Seventh Diversity Further
Notice also emphasized that the benefits
of improved data collection outweigh
any de minimis costs or burdens
associated with obtaining a CORES FRN
or RUFRN. The Commission explained
that an individual that already has a
CORES FRN may continue to report it
on the Form 323 or Form 323–E filings
and that there is no need to obtain an
RUFRN.
22. The Commission sought comment
on these subjects and its conclusions
that the RUFRN proposal will improve
the reliability and usability of the
broadcast report data. The Seventh
Diversity Further Notice also sought
comment on its conclusion that the
RUFRN as a unique identifier will
permit the Commission to implement
burden-reducing modifications that
could reduce the types of errors
identified in the 2009, 2011, and 2013
filing periods.
23. The Commission also sought
comment on extending the RUFRN to
Form 323–E in the event that changes
proposed in the pending Fourth and
Sixth Diversity Further Notices are
adopted. As discussed above, the Fourth
Diversity Further Notice proposed to
collect race, gender, and ethnicity
information from attributable
individuals reported on Form 323–E,
and the Sixth Diversity Further Notice
proposed to extend the CORES FRN
reporting requirement to
noncommercial stations. In the Seventh
Diversity Further Notice, the
Commission proposed that, in the event
those proposed changes are adopted,
individuals reported on Form 323–E
also may be permitted to obtain and
provide an RUFRN in lieu of a CORES
FRN for use on the broadcast ownership
report filings. The Commission further
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acknowledged the comments opposing
the Sixth Diversity Further Notice
proposal to extend the CORES FRN
requirement to NCE stations. There,
commenters argued that the CORES
FRN requirement would be unduly
burdensome and would discourage
individuals from serving on the boards
of NCE stations. Moreover, commenters
argued that NCE station licensees would
have difficulty obtaining SSNs from
board members, which may include
government officials. The Seventh
Diversity Further Notice sought
comment on how these concerns would
be implicated if RUFRNs were available
as an alternative to CORES FRNs for
Form 323–E. The Commission noted
that officers and directors of NCE
stations are already considered to be
attributable interest holders in NCE
stations and are already required to be
reported on Form 323–E and sought
comment on whether NCE stations
present unique concerns with respect to
ownership reporting requirements that
should be considered by the
Commission. The Commission also
sought alternatives to the RUFRN for the
unique identification of individuals in
the NCE context.
24. Finally, the Seventh Diversity
Further Notice sought additional
comment on the elimination of the
SUFRN, a proposal also contained in the
Sixth Diversity Further Notice. The
Commission noted that commenters
previously supported the proposal to
retain the availability of the SUFRN for
the limited purpose of reporting an
individual that is unwilling to provide
his or her SSN to third parties or
unwilling to obtain and provide a
CORES FRN and opposed the
Commission’s use of its enforcement
authority against individuals who failed
to provide a CORES FRN. The Seventh
Diversity Further Notice sought
comment on whether the SUFRN should
continue to be available to Form 323
filers (and, in the event proposed
modifications are adopted, to Form 323–
E filers), provided that a filer has used
reasonable and good-faith efforts to
obtain a CORES FRN or RUFRN from or
on behalf of an individual. The
Commission also asked whether the
availability of the SUFRN would protect
filers in the case of recalcitrant
individuals and whether filers should
be required to instruct individuals of the
obligation to obtain and provide a
CORES FRN or an RUFRN. The Seventh
Diversity Further Notice also sought
comment on the type of instruction and
notification of the risk of enforcement
action the Commission should provide
or require if a CORES FRN or RUFRN
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19437
is not reported for that individual. The
Seventh Diversity Further Notice was
published in the Federal Register on
February 26, 2015. Comments were due
on or before March 30, 2015 and reply
comments were due on or before April
13, 2015.
III. Discussion
25. By the actions the Commission
here, the Commission advances its
commitment to improving the
comprehensiveness and reliability of the
ownership data collected on Forms 323
and 323–E to enable more effective
analysis of ownership trends in support
of policy initiatives promoting diversity
in ownership of broadcast stations.
Accordingly, the Commission will no
longer allow filers to use SUFRNs on
biennial ownership reports, except in
limited cases, and instead will require
that on such forms filers provide a
CORES FRN or RUFRN for any
reportable individual attributable
interest holder. In addition, the
Commission updates its reporting
requirements for NCE stations to more
closely parallel the requirements for
commercial stations. The Commission
also makes certain changes to its Form
323 and Form 323–E aimed at reducing
the filing burdens on broadcasters and
improving data collection. Finally, the
Commission declines to adopt certain
proposals detailed in comments in this
proceeding as redundant, unnecessary,
technically infeasible, or unsupported.
A. RUFRN Requirement
26. The Commission concludes that
the RUFRN is important to the
Commission’s ongoing mission to
improve, streamline, and modernize the
way it collects and uses data. The
Commission continues to believe that it
must be able to uniquely identify parties
reported on broadcast ownership reports
for purposes of creating reliable and
usable data in support of the
Commission’s policy initiatives
promoting diverse ownership. The
Commission has recognized that the
TIN/SSN backed CORES FRNs offer a
unique identifier and therefore play an
important role in promoting the
integrity of the data collected on Form
323. The Commission, however, is also
sensitive to concerns that have been
expressed regarding a mandate that
every individual attributable interest
holder of a broadcast station submit his
or her SSN to the Commission for
purposes of broadcast ownership
reporting. The creation of the new
RUFRN mechanism within CORES,
allowing individuals to obtain a unique
identification number without
submitting a full SSN, properly balances
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the concerns of individual attributable
interest holders with the Commission’s
mandate to ensure the reliability and
utility of its broadcast ownership data.
27. Broadcast Ownership Reporting
Using the RUFRN Supports the
Commission’s Data Gathering and
Policy Making Initiatives. The
Commission has previously recognized
that sections 257 of the 1996 Act, 47
U.S.C. 257, and 309(j) of the Act, 47
U.S.C. 309(j), support its efforts to
gather the ownership data contained in
Form 323. Section 257 directs the
Commission to identify and eliminate
‘‘market entry barriers for entrepreneurs
and other small businesses in the
provision and ownership of
telecommunications services and
information services, or in the provision
of parts or services to providers of
telecommunications services and
information services.’’ To implement
this mandate, the Commission is
directed to ‘‘promote the policies and
purposes of [the 1996 Act] favoring
diversity of media voices, vigorous
economic competition, technological
advancement, and promotion of the
public interest, convenience and
necessity.’’ As the Commission has
previously recognized, improving the
reporting of ownership data enables the
Commission to carry out this mandate.
28. Similarly, pursuant to section
309(j), the Commission must award
licenses in a manner that ‘‘promot[es]
economic opportunity and competition
and ensur[es] that new and innovative
technologies are readily accessible to
the American people by avoiding
excessive concentration of licenses and
by disseminating licenses among a wide
variety of applicants, including small
businesses, rural telephone companies,
and businesses owned by members of
minority groups and women.’’ Congress
directed the Commission to regulate in
a manner that ensures that ‘‘small
businesses, rural telephone companies,
and businesses owned by members of
minority groups and women’’ are
represented in licensed activities. The
statute further requires that the
Commission ‘‘ensure that small
businesses, rural telephone companies,
and businesses owned by members of
minority groups and women are given
the opportunity to participate in the
provision of spectrum-based services.’’
As the Commission has previously
determined, section 309(j) is evidence of
a congressional policy in support of the
grant of broadcast licenses to a wide
variety of groups, including minorities
and women.
29. In the 1998 Biennial Review
Order, 63 FR 70040, Dec. 18, 1998, FCC
98–281, rel. Nov. 25, 1998, the
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Commission concluded that, in order to
fulfill its statutory mandates, it must
collect race, gender, and ethnicity
information from all interest holders
reported on Form 323. In the 1998
Biennial Review Order, the Commission
stated that it would take up at a later
date whether to apply these
requirements to Form 323–E, as well.
The Commission now finds that these
requirements should be applied to Form
323–E, and the Commission’s
discussion on this matter can be found
below. Collecting these data enables the
Commission not only to assess the
current state of minority and female
ownership of broadcast stations but also
to determine the success of programs
that are designed to facilitate
opportunities for women- and minorityowned businesses and to promote a
diversity of media voices. Just as it is
essential for the Commission to collect
these ownership data to fulfill its
mandates, it is important that these data
be reliable, aggregable, and useful for
studies and trend analysis by others.
30. The Commission finds that flaws
in the current practices related to the
reporting of SUFRNs for individuals
listed on Form 323 compromise the
integrity of the data collected and
thereby frustrate the Commission’s
attempts to fulfill its statutory mandates
under section 257 and section 309(j).
The SUFRN was devised as merely a
computer-generated number to be
created by clicking a button within
Form 323 itself and not backed by any
identifying information. The
Commission collects no information
when the system generates a new
SUFRN, and there is no database
analogous to CORES that contains
uniquely identifying information
associated with SUFRNs. The SUFRN
therefore offers the Commission no way
to cross reference or trace back reported
information to a single individual. It
was intended only as an interim
measure. Based on the Commission’s
experience reviewing the ownership
reports submitted during three separate
biennial reporting cycles, it is clear that
SUFRNs have been used in a manner
that is inconsistent with the
Commission’s direction and that
undermines the integrity of the data. On
the one hand some SUFRNs have been
used in conjunction with multiple
individuals, and on the other hand
individuals have used multiple
SUFRNs. Because the Commission
currently cannot determine whether two
SUFRNs identify one or more
individuals, it cannot reliably examine
the complete attributable holdings of an
individual reported with an SUFRN
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(either at a specific time or over time),
or search, aggregate, and cross reference
the ownership data. Any attempt at such
analysis would require manual analysis
of every single entry where an SUFRN
appears together with a subjective
analysis of other textual information
contained on the form or available from
other public sources. The Media Bureau
cannot confidently determine the
number of individuals reporting
SUFRNs. In the 2011 biennial
ownership reports, the Bureau found
that 3,326 unique SUFRNs were
reported, and, because some were
reported multiple times, SUFRNs were
used in 8,719 instances. Because it is
possible for filers to improperly report
SUFRNs for individuals—either
reporting multiple SUFRNs for a single
individual on multiple reports or using
the same SUFRN for multiple
individuals on multiple reports—
despite instructions to the contrary, the
Bureau concluded that the number of
unique SUFRNs reported during the
2011 filing period cannot be relied on to
accurately determine the number of
individuals using SUFRNs. Manual,
subjective analysis of thousands of Form
323 entries using various sources of
information compromises data integrity
and data utility. Consequently, the
Commission cannot rely on the SUFRNs
reported to provide reliable ownership
data.
31. In the Sixth Diversity Further
Notice, 78 FR 2925, Jan. 15, 2013, FCC
12–166, rel. Jan 3, 2013, the
Commission tentatively concluded that
TINs/SSNs within CORES were
necessary as underlying unique
identifiers of individuals. Commenters
to the Sixth Diversity Further Notice
strongly objected to the proposed
Commission mandate that all individual
attributable interest holders submit an
SSN to the Commission to obtain a
traditional CORES FRN.
32. In contrast, in the Seventh
Diversity Further Notice, 80 FR 10442,
Feb. 26, 2015, FCC 15–19, rel. Feb. 12,
2015, the Commission tentatively found
that a proposed alternative to the
traditional CORES FRN would provide
a reasonable basis for determining that
an individual is uniquely identified
within the CORES system. Specifically,
the Commission proposed making
available a new identifier, the RUFRN.
Filers wishing to use this identifier
would be required to submit an
individual’s full name, residential
address, date of birth, and only the last
four digits of the individual’s SSN. In
response to the Seventh Diversity
Further Notice, commercial broadcasters
and public interest groups support the
alternative RUFRN approach. Some
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commenters argue that the use of
SUFRNs on Form 323 ‘‘ha[s] introduced
inaccuracy and uncertainty into media
ownership data,’’ because SUFRNs are
not backed by identifying information
that can reliably be linked to a unique
individual. While the CORES FRN
system is a superior solution, RUFRNs
are a sufficient means for identifying
individuals and allowing longitudinal
analysis of media ownership trends,
they state. No commenters propose
additional or different pieces of
information that would better enable the
Commission to ensure that individuals
are uniquely identified.
33. Some commenters disagree that
the RUFRN proposal is superior to the
existing SUFRN system. Although these
commenters focus primarily on issues
related to NCE attributable interest
holders, which are addressed in detail
below, some of the arguments suggest
that the use of RUFRNs will not
substantially and meaningfully improve
the quality of the Commission’s
broadcast ownership data generally.
These commenters assert that if SUFRNs
are being misused, it is either due to
mistakes or conscious decisions not to
comply with Bureau guidance.
According to these commenters, either
remains possible with the proposed
RUFRN system. The Alabama
Educational Television Commission
(AETC) et al. argue that users could
accidentally enter information
incorrectly, forget to enter a previously
used SUFRN or FRN, or intentionally
violate the Commission’s rules, and that
errors could also stem from data entry
problems on Form 323 itself, such as
inadvertent or intentional mistyping of
RUFRNs, SUFRNs, or FRNs. AETC et al.
urge the Commission to retain the
SUFRN for individual attributable
interest holders that refuse to obtain a
CORES FRN or RUFRN, without
imposing substantiation requirements,
and to specifically exclude ‘‘NCE and
non-profit licensees’’ from the new
RUFRN requirement. The Commission
addresses these two requests below and
addresses here the more general
assertion. In addition, commenters state,
insofar as the Commission intends to
allow use of ownership data by thirdparty researchers, much of the benefit
that comes from the use of RUFRNs is
negated by the Commission’s proposal
to hold securely and confidentially
within CORES all identifying
information used to obtain RUFRNs,
except for names and the RUFRNs
themselves.
34. The Commission finds that its
policy initiatives are dependent on the
quality of the data collected. The
Commission concludes that having
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reasonable assurance that attributable
interest holders are uniquely identified
on ownership reports in a manner that
ensures that the data can be
meaningfully searched, aggregated, and
cross referenced electronically is crucial
to the quality and usability of the
Commission’s ownership data. The
Commission concludes that the SUFRN
cannot provide unique identification of
individual attributable interest holders
on broadcast ownership reports, and the
Commission concludes that requiring an
FRN generated by CORES, either
through existing mechanisms or via the
RUFRN method, for all attributable
interest holders on broadcast ownership
reports is essential to improve the
quality and usability of the data
collected. The Commission therefore
adopts the RUFRN as an alternative
mechanism within CORES that will
allow an individual (not entities) to
obtain an RUFRN by submitting an
alternate set of identifying information
that does not include a full SSN: Full
name, residential address, date of birth,
and the last four digits of the
individual’s SSN.
35. The identifying information
provided by the individual will be
stored confidentially within CORES, as
other sensitive information is stored in
CORES to support CORES FRNs issued
pursuant to existing functionalities.
Only the individual’s name and RUFRN
will be available publicly. Both the
RUFRN and the associated ownership
information will be entirely machine
readable and will not require manual
consideration of each biennial
ownership form to analyze whether
various Form 323 entries might identify
the same individual or different
individuals. The same is true for the
CORES FRN and underlying TIN. The
CORES system will be programmed to
verify that the information submitted by
the applicant is complete and does not
duplicate any information that is
already associated with an RUFRN in
CORES. The Commission concludes
that, since RUFRNs will be backed by
identifying information, and since
CORES will not issue multiple RUFRNs
for the same identifying information,
RUFRNs can be relied on to identify
individuals uniquely. When the
applicant obtains an RUFRN, the
applicant will be asked to list all CORES
FRNs registered to the individual and
all SUFRNs the individual previously
used in any broadcast ownership report
filings since the 2009 biennial reporting
cycle. The Commission concludes that
such disclosures will allow it to identify
CORES FRNs, RUFRNs, and SUFRNs
that identify the same individual,
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19439
promoting the usefulness of the
broadcast ownership data for purposes
of electronic searching, aggregating, and
cross-referencing and for trend analysis.
RUFRNs may be used only on broadcast
ownership reporting forms and only for
individuals (not entities) reported as
attributable interest holders. Once an
RUFRN is issued, any ownership report
filing that lists the individual associated
with that RUFRN will be required to
include that RUFRN. However, an
individual may opt to use a traditional
CORES FRN instead of obtaining and
using an RUFRN. In the Sixth Diversity
Further Notice, the Commission sought
comment on the Koerner & Olender
Petition for Reconsideration, which
requested that the Commission either
reconsider its requirement that
individuals holding attributable
interests obtain a CORES FRN, which in
turn would require such individuals to
provide the Commission with their SSN,
or ‘‘redefine or reinterpret’’ section
1.8002 of the Commission’s rules to
clarify that individuals with reportable
interests must obtain a CORES FRN. The
Commission notes that the petition’s
concerns about the disclosure of
individuals’ full SSNs are addressed by
the RUFRN system the Commission is
adopting, which will allow individual
attributable interest holders to obtain an
RUFRN without disclosing their full
SSNs to the Commission. Thus, the
Commission grants the petition to the
extent Koerner & Olender sought
reconsideration of the requirement for
individuals holding attributable
interests in licensees to provide their
SSN to the Commission. Further, since
the Commission is not requiring such
individuals to obtain a CORES FRN,
which is the identifier addressed by
section 1.8002, there is no need to
modify section 1.8002 in connection
with the adoption of the RUFRN
requirement. The Commission therefore
denies the Koerner & Olender Petition
for Reconsideration to the extent it
requests that the Commission amend
section 1.8002. With this Report and
Order, all the issues raised in the
Fletcher Heald Petition for
Reconsideration are resolved. The
Fletcher Heald Petition for
Reconsideration requested that the
Commission provide additional
opportunity for public comment on the
CORES FRN requirement before
requiring the reporting of CORES FRNs
for individuals reported on Form 323
due to concerns about the disclosure of
individuals’ full SSNs. The Commission
has issued two further notices of
proposed rulemaking to consider these
issues. Consistent with the discussion in
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this Report and Order, the Commission
grants the Fletcher Heald Petition for
Reconsideration to the extent it seeks
reconsideration of the requirement that
filers provide a traditional CORES FRN,
requiring the submission of a full SSN/
TIN, for every individual attributable
interest holder reported on Form 323.
Filers are permitted to provide RUFRNs,
requiring submission of an alternate set
of identifying information that does not
include a full SSN, in lieu of CORES
FRNs for individuals reported on Form
323. In addition, the Commission will
continue to allow the use of SUFRNs on
Form 323 in the limited circumstances
described below. To the extent that the
Fletcher Heald Petition for
Reconsideration seeks relief
inconsistent with the actions taken in
this Report and Order, the Commission
denies the Fletcher Heald Petition for
Reconsideration.
36. The Commission does not believe
that the existence of possible situations
or limitations some commenters
identified in objecting to the RUFRN
compel the Commission to abandon its
conclusion that RUFRNs offer superior
data quality to SUFRNs for the purpose
of broadcast ownership reports. As the
Commission stated in the Seventh
Diversity Further Notice, the
Commission expects that individuals
and entities will comply with the
Commission’s rules and provide
accurate information during the CORES
registration process to the greatest
extent possible. Moreover, the
Commission finds that the specificity of
the identifying information required to
obtain an RUFRN and the fact that a
number of pieces of information are
required will be sufficient to provide the
Commission with reasonable certainty
that the information identifies a unique
filer within the CORES system. While
holding some of this information
confidential does limit the ability of
outside researchers to use it to ensure
unique identification, that limitation
does not decrease the ability of the
Commission to do so, just as the
confidentiality of an SSN underlying a
CORES FRN does not. Further, the
Commission’s obligation to hold
confidential the identifying information
underlying the RUFRN will not limit
appreciably the utility of RUFRNs to
outside researchers as a unique
identifier, because the RUFRN
application will include a mechanism to
prevent issuance of multiple RUFRNs
based on the same identifying
information (i.e., issuance of multiple
RUFRNs to the same individual). As
described above, the raw Form 323
biennial ownership data is available to
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the public, and the Media Bureau has
released reports reflecting its analysis of
ownership data submitted for the 2009,
2011, and 2013 reporting rounds.
Future, similar reports are contemplated
reflecting additional biennial reporting
periods. Based on the Commission’s
experience in the 2009, 2011, and 2013
reporting cycles, the Commission
concludes that the RUFRN will improve
the reliability and usability of the
broadcast ownership report database, in
furtherance of the Commission’s
statutory mandates. As discussed
elsewhere in this Report and Order, the
Commission’s examination of
ownership reports from 2009, 2011, and
2013 revealed numerous data reporting
errors, and the Commission has no
reason to believe that all of these errors
were the result of filers attempting to
deliberately mislead the Commission.
The presence of a unique identifier
improves the quality of the
Commission’s ownership data by
permitting errors to be identified and
remedied. For example, the presence of
the same individual’s RUFRN on
multiple reports, along with
inconsistent gender and/or race
information, may indicate one or more
reporting errors that can then be cured.
In light of the foregoing, the
Commission rejects commenters’
arguments that the use of RUFRNs to
identify individuals is inconsequential
for the purpose of tracking ownership
trends.
37. RUFRNs Are Not Burdensome,
and the Benefits Outweigh the Costs.
The Commission concludes that its
decision to allow individual attributable
interest holders the option of obtaining
and using an RUFRN in lieu of a
traditional CORES FRN will impose
minimal costs and burdens, if any, on
individuals or filers. As noted above,
individuals who already have a CORES
FRN will be able to continue using their
existing number without having to
register for an RUFRN, and any other
reportable individual that wishes to
obtain a CORES FRN instead of an
RUFRN will still be able to do so. Like
registering for a CORES FRN, registering
for an RUFRN will be a one-time
process that takes a few moments to
complete. An individual need only fill
out a short online form requiring just a
few pieces of information: A name,
address, birth date, and the last four
digits of the SSN. The applicant also
provides a password and a personal
security question (to help in case the
applicant later misplaces or forgets his
or her password). There are at most de
minimis costs or burdens associated
with obtaining the number. An
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individual does not need to provide
personal information to anyone other
than the Commission to obtain a CORES
FRN or RUFRN. That information can be
provided to the Commission alone, and
then the CORES FRN or RUFRN can be
provided to a licensee for reporting
purposes. In addition, the RUFRN will
serve as a unique identifier that can be
cross referenced easily, which will
enable the Commission to make certain
modifications to broadcast ownership
reporting that will reduce the burdens
on all filers, as described below, and
therefore further improve the quality of
the ownership data submitted to the
Commission. The Commission
concludes that these benefits outweigh
the de minimis costs or burdens
associated with obtaining an RUFRN.
Although some commenters argue that
implementing the RUFRN would
impose specific burdens on NCE
licensees, as discussed below, no
commercial entity disputes the
Commission’s finding that RUFRNs will
not be burdensome for commercial
entities or individuals holding
attributable interests in them. AETC et
al. argue that the RUFRN requirement
will be overly burdensome, particularly
for ‘‘NCE and non-profit licensees.’’
Below, the Commission addresses
burden-related arguments specific to
NCE stations.
38. Security of Commission Systems.
In the Sixth Diversity Further Notice, 78
FR 2925, Jan. 15, 2013, FCC 12–166, rel.
Jan 3, 2013, the Commission sought
comment on any security concerns
related to the requirement that a TIN/
SSN for every attributable interest
holder be provided to the Commission.
The Commission noted that while TIN/
SSN data is collected during the CORES
FRN registration process, TINs/SSNs are
not disclosed on any Commission
application or form, including Forms
323 and 323–E. Commenters raised
concerns that a CORES FRN
requirement for individuals will open
individuals to threats of identity theft.
Some commenters pointed to a system
breach described in a GAO report on
information security (Information
Security GAO Report), GAO–13–155,
Jan. 2013, and suggested that the
Commission’s systems are vulnerable to
a security breach. In the Seventh
Diversity Further Notice, 80 FR 10442,
Feb. 26, 2015, FCC 15–19, rel. Feb. 12,
2015, the Commission described the
safeguards in place on the Commission’s
systems and improvements that have
been implemented to assure the security
of the Commission’s systems, including
that of CORES. The Commission
reiterated that security continues to be
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one of the Commission’s highest
priorities, and sought comment on
whether the elimination of the
requirement of individual attributable
interest holders to submit a full SSN to
CORES eliminates the privacy and
identity theft concerns that have been
previously raised. The Commission also
asked for guidance on how to address
any remaining concerns that are not
alleviated, and whether those concerns
outweigh the importance of the data
collection.
39. In response, NAB states that
RUFRNs, because they create a unique
identifier without requiring individuals
to submit full SSNs to the Commission,
provide a ‘‘safety valve’’ for individuals
who might be reluctant to obtain a
CORES FRN due to data privacy and
security concerns. NAB claims this is
accomplished without compromising
the quality of the Commission’s
ownership data. Thus, states NAB, the
RUFRN proposal for commercial
broadcasters reflects a better balancing
of affected interests than simply
eliminating the SUFRN and mandating
CORES FRNs in all cases.
40. NCE commenters, on the other
hand, continue to express concerns
about identity theft, even though the
RUFRN does not require the disclosure
of full SSNs. NCE commenters state that
the existence of an individual’s name,
address, date of birth, and the last four
digits of an SSN would permit hackers
to predict a full SSN. Some commenters
cite a study conducted by researchers at
Carnegie Mellon University. In that
study, researchers were able 44 percent
of the time to predict the first five digits
of individual SSNs for persons born
after 1989.6 In addition, some
commenters note that higher education
institutions have recognized the need to
protect the confidentiality of
individuals’ birth dates and the last four
digits of their SSNs. As an example,
these commenters cite the California
State University System’s Information
Security Data Classification standards,
which mandate the highest level of
information security for an individual’s
birth date combined with the last four
digits of the SSN and state that
unauthorized disclosure of that
information could result in ‘‘severe
damage to CSU, its students, employees
or customers.’’ Even if an individual’s
full SSN is not reconstructed, assert
AETC et al., a successful hacker could
still gain access to countless private
accounts held by those interest holders
6 See American Association for the Advancement
of Science, Social Security Numbers are Easy to
Guess, Science News, from the journal Science (July
6, 2009), https://news.sciensemag.org/2009/07/
social-security-numbers-are-easy-guess.
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because many financial institutions,
utility accounts, and other businesses
use the last four digits of the SSN to
restore a lost password or access an
account, frequently in combination with
other information the Commission
proposes to require for an RUFRN. NCE
commenters also raise concerns
regarding the potential disclosure of
individuals’ residential addresses,
stating that NCE board members are
often public officials or other prominent
individuals who wish to keep this
information private for the safety of
themselves and their families. In the
Seventh Diversity Further Notice, the
Commission proposed that, for the
RUFRN, the individual’s name and
RUFRN could be available publicly but
the remaining identifying information
would be held securely and
confidentially within CORES. As stated
there, the Commission has taken steps
and put in place procedures to assure
the security of the Commission’s
systems. Moreover, the Commission
continues to strengthen the security of
its systems, as discussed below.
41. Even if the Commission’s systems
have not been breached to date, NCE
commenters argue, there is no assurance
that a successful breach will not occur
in the future. They again point to the
Information Security GAO Report and
cite to reports of recent breaches at the
White House and other Federal offices.
Some commenters claim that the risk of
breach would increase if the
Commission begins storing in CORES
information about NCE board members
because some are public officials or
other prominent individuals. Although
it is sometimes necessary to collect
personal information that can be used
for identity theft, AETC et al. assert, to
provide maximum protection, the
collection of such information must be
limited to situations where there is no
alternative.
42. As stated in the Seventh Diversity
Further Notice, the Commission agrees
with commenters that privacy and
security with respect to personally
identifiable information are paramount,
and the Commission remains committed
to protecting such interests. The
Commission notes that its systems
currently safely house a significant
amount of information that is the same,
similar, or—in the case of full SSNs—
even more sensitive than the
information underlying the RUFRN.
Despite commenters’ repeated citation
to the Information Security GAO Report,
as the Commission has stated before, the
Commission is not aware of any
breaches to CORES. As the Commission
has previously stated, the Commission
was in the process of implementing
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19441
certain improvements before the
completion of the Information Security
GAO Report, and the Commission
continues to strengthen its security
environment using the
recommendations contained in the
Report. The Information Security GAO
Report did not identify any security
deficiencies in CORES. For the
Commission’s statement regarding its
response to the security breach and the
deployment of the Enhanced Secured
Network Project, see pages 26 through
29 of the Information Security GAO
Report. The enhanced perimeter
controls, malware protection, and
monitoring devices continue to be in
place, and the workstation operating
systems are routinely upgraded with
improved security. The Commission’s
systems and security architecture
continue to contain robust strict
operational controls that comply with
National Institute of Standards and
Technology guidance. The
Commission’s system servers remain
behind several firewalls, and security
controls continue to be upgraded to
protect CORES data from intrusion by
outsiders and the general Commission
population. Furthermore, the
Commission has recently moved to a
Managed Trusted Internet Protocol
Service (MTIPS) provider that will move
the Commission from being Internet
Protocol Version 4 to Internet Protocol
Version 6 going forward. Again,
administrative access to CORES remains
limited and all servers continue to be
monitored through the use of automated
tools and operational procedures. The
Commission will continue to make the
necessary upgrades to ensure the
security of CORES and all of its systems,
and protecting the personally
identifiable information contained in its
system will remain one of the
Commission’s highest priorities.
43. No commercial entity has
contested the Commission’s proposal to
implement the RUFRN system for
individual attributable interest holders
in commercial broadcast stations, and
NCE commenters have offered no
compelling reason why the Commission
must conclude that the system security
needs or risks of NCE attributable
interest holders are greater than those of
commercial attributable interest holders.
Indeed, the quality of the information is
similar or exactly the same. The
observation that NCE attributable
interest holders may be public officials
or other prominent individuals is also
true in the commercial realm. The
Commission takes its data security
obligations to all entities and
individuals that have confidential
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information housed within the
Commission’s systems extremely
seriously. Commenters also concede
that it is sometimes necessary to collect
personally identifiable information
when no alternative method exists.
Indeed, this is such a situation. As
noted above, to fulfill its statutory
mandate to promote diversity of media
voices and avoid excessive
concentration of licenses by
disseminating them to, among others,
businesses owned by members of
minority groups, the Commission must
have reliable, comprehensive data
reflecting the attributable interest
holders in broadcast stations. The
Commission has repeatedly requested
comment on alternatives that would
balance the Commission’s need to
uniquely identify individual attributable
interest holders on the biennial
ownership reports with privacy needs.
No commenter in this proceeding has
offered an alternative to the CORES FRN
or RUFRN and the Commission has
concluded that the SUFRN is not a
suitable alternative. The Commission
believes that that the RUFRN as an
alternative to a traditional CORES FRN
is a reasonable approach that balances
the Commission’s need to uniquely
identify reportable individuals with the
security and privacy concerns raised by
the commenters. No commenters assert
that the Privacy Act would bar the
adoption of the RUFRN requirement for
the reporting of attributable interest
holders on ownership reports for either
commercial stations or NCEs. The
Commission finds that the RUFRN
requirement described herein is
consistent with the Privacy Act for Form
323 and Form 323–E. The Commission
directs the Media Bureau to prepare the
necessary documents to comply with
the Privacy Act.
B. Improvements to Data Collection
From NCE Stations
44. To enhance the completeness of
the Commission’s data collection,
promote data integrity, and ensure that
data are electronically readable and
aggregable, the Commission revises
Form 323–E for NCE stations to collect
race, gender, and ethnicity information
for attributable interest holders, require
that CORES FRNs or RUFRNs be used,
and conform the biennial filing deadline
for NCE broadcast ownership reports
with the biennial filing deadline for
commercial station ownership reports.
In limited circumstances there may be
additional parties—other than officers
or directors—that hold attributable
interests in an NCE station. For
example, some states allow non-profit
organizations to issue voting stock or
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the equivalent thereto. Holders of five
percent or more of the voting stock of
such entities are attributable owners
pursuant to section 73.3555, Note 2(a),
and must be reported on Form 323–E in
the same manner as officers and
directors (including the provision of a
CORES FRN and, in the case of
individuals, race, gender, and ethnicity
information). As noted below, the
Commission’s revisions to Form 323–E
and its instructions confirm this point.
Attached to this Report and Order is a
draft of the revised version of Form
323–E that will be submitted for OMB
approval. The draft revised version of
Form 323–E that is attached to this
Report and Order at Appendix E
resembles in several ways the draft
revised version of Form 323 that is
attached to this Report and Order at
Appendix D and, where applicable,
includes counterparts to the
modifications to Form 323 discussed
herein. Section and question references
in this Report and Order refer to the
current version of the form, which is
implemented in the Commission’s
Consolidated Database System (CDBS).
Because the revised version of the form
will be implemented in the
Commission’s Licensing and
Management System (LMS), it will be
given a new number, and its format,
structure, and question identification
will differ from the CDBS version of the
form. When discussing issues
concerning Form 323–E, some
commenters suggested that the
Commission make changes to forms
other than its broadcast ownership
reports. The Commission declines to do
so at this time, as these proposals are
outside the scope of this proceeding.
45. Including NCE Stations Improves
Data Completeness. As noted above, the
Commission has previously determined
that it has authority under section 257
and section 309(j) to collect ownership
information from commercial broadcast
stations. The Commission finds that its
analysis with regard to the collection of
data from commercial stations is equally
applicable in the NCE context. NCE
stations hold Commission licenses, as
do commercial licensees. Their
programming impacts local
communities. Nothing in the statute
distinguishes the noncommercial nature
of any segment of a service as exempting
it from the overall statutory mandates.
Accordingly, the Commission finds that
it has authority to collect race, gender,
and ethnicity information from
attributable interest holders in NCE
stations, and the Commission affirms
the conclusion in the Fourth Diversity
Further Notice that doing so will further
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the Commission’s goal of designing
policies to advance diversity. Further,
the adoption of the CORES FRN
requirement in the context of Form 323–
E is supported by the Commission’s
statutory mandates under section 257 of
the 1996 Act and section 309(j) of the
Act.
46. The Commission has previously
found that, in order to adopt policies or
regulations to promote minority and
female ownership of broadcast stations,
it is imperative to have information
about female and minority ownership in
broadcasting as a whole—specifically
including ‘‘the entire universe of NCE
stations.’’ In light of this, commenters
who assert that there is no policy
justification for the Commission to
collect ownership data from NCE
stations are incorrect. Similarly, the
Commission disagrees with commenters
who suggest that collection of
ownership data from NCE licensees is
unnecessary because, pursuant to
section 73.3555(f) of the Commission’s
rules, NCE stations are not subject to the
Commission’s multiple ownership
restrictions. The GAO and outside
researchers have criticized the
Commission specifically for its failure to
collect data concerning ownership of
NCE stations, and many have described
prior data collections as incomplete.
47. The Fourth Diversity Further
Notice, 74 FR 25205, May 27, 2009, FCC
09–33, rel. May 5, 2009, sought
comment on the proper definition of
‘‘ownership’’ in the NCE context, asking
whether looking at the composition of
the board of directors or other governing
body of an NCE station would be
appropriate for determining
‘‘ownership’’ for Form 323–E purposes.
Several commenters support this
approach, noting, for example, that
board members have legally cognizable
duties to the station licensees, often are
involved in station operations and
hiring decisions, have final authority
over NCE licensees, and are responsible
to the local communities they serve.
Other commenters argue that
dissimilarities between the governance
of commercial and NCE stations
precludes any definition of
‘‘ownership’’ in the NCE context. These
parties note that board members do not
have equity stakes in the stations they
serve; are often governmental officials,
governmental appointees, individuals
elected by station members, or
volunteers; and often are not involved
in day-to-day station operations.
Commenters also made similar
arguments as they related to the
proposals raised in the Sixth and
Seventh Diversity Further Notices.
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48. Officers and directors of NCE
stations already are defined as
attributable interest holders in NCE
stations and they already are reported
on Form 323–E. The Commission finds
that the additional requirements it
imposes here—including requiring race,
gender, and ethnicity information, and a
CORES FRN or RUFRN—do not involve
crafting or imposing a new legal
definition of ‘‘ownership’’ with respect
to NCE stations. For Form 323 and Form
323–E purposes, the concept of
ownership relies on the attribution
standards set forth in section 73.3555 of
the Commission’s rules, which generally
do not depend on equity interests but
instead ‘‘seek to identify those interests
. . . that confer . . . a degree of
influence or control such that the
holders have a realistic potential to
affect the programming decisions of
licensees or other core operating
functions.’’ The National Federation of
Community Broadcasters and the
Prometheus Radio Project ask what
percentage voting interest standard is
applicable to Form 323–E. Revised Form
323–E relies on the standards set forth
in section 73.3555. Arguments that the
Commission should not impose these
additional requirements for NCE
stations because the individuals have no
equity ownership therefore are not
compelling.
49. Individuals or entities that hold
attributable ownership interests in
commercial broadcast stations often do
not hold equity interests in those
stations. For example, an officer or
director of a commercial broadcast
licensee is an attributable owner of the
licensee’s station(s), regardless of
whether he or she has any equity
interest in the licensee. As discussed
below, an officer or director may be
granted an exemption from attribution
only if his or her duties are wholly
unrelated to the licensee. Members of
partnerships and limited liability
companies likewise are attributable
owners, regardless of whether or not
they hold an equity stake. Such parties
may be insulated from attribution,
regardless of equity stake, if they certify
that they will not be materially involved
in any way in the licensee and the
relevant organizational documents
provide for such insulation. It is not
uncommon for limited liability
companies or partnerships to assign
little or no equity to the member(s) or
partner(s) that hold the voting interest
and assign all or most of the equity to
members or limited partners that have
no votes and/or are insulated pursuant
to the relevant Commission criteria.
Voting stock interests held in trust are
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attributable to the parties who can vote
the stock, which usually include the
trustee but may or may not include the
beneficiary (the party that holds the
equity). Non-voting stock cannot give
rise to an attributable ownership
interest, even though it has equity value,
unless the Commission’s EDP Rule is
implicated. Moreover, while an
individual’s or entity’s equity stake can
play a role in determining attribution
under the EDP Rule, the equity is not an
issue in and of itself; rather, the
rationale is that the individual’s or
entity’s combined equity and debt stake,
plus additional factors specified in the
rule, provide the requisite ability to
influence the licensee. Further, a party
that is attributable under the EDP Rule
may have no equity stake in the licensee
whatsoever, but instead be attributable
based on a significant debt-only interest
(coupled with the other specified
factors). Simply put, the Commission’s
standards for attributable ownership
generally do not depend on equity
positions, and many parties hold
attributable interests in stations without
any equity involvement in those
stations. These attribution standards
apply to both commercial and
noncommercial stations, and the
individuals and entities these standards
capture have the potential to exert
influence over the licensee, regardless of
whether the station at issue is
commercial or noncommercial. While
the rule provides an example using the
attribution standards to evaluate
mutually exclusive NCE applications
under the Commission’s point system,
the Commission has made clear that the
section 73.3555 attribution standards
apply whenever attribution issues are
relevant for NCE purposes. Officers and
directors therefore are attributable
owners of the NCE licensees they serve.
In certain limited cases, a non-profit
entity holds a commercial license.
Several such licensees indicate that,
because they are not commercial
entities, much of Form 323 contains
questions that are inapplicable to their
structure, and these licensees ask to use
Form 323–E instead. The Commission
will deem the filing of Form 323–E, in
accordance with the standards set forth
herein, compliant with the
Commission’s biennial filing obligation
where a non-profit entity holds a
commercial license.
50. The observation that NCE board
members are often governmental
officials, governmental appointees,
individuals elected by station members,
or volunteers does not lead the
Commission to a different conclusion.
The Commission’s attribution standards
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19443
depend not on the manner in which an
individual came to be a member of a
station’s board of directors or other
governing body, but rather on the ability
to influence station programming or
operations that his or her membership
confers. Similarly, because a party can
exert influence over a station without
being involved in the day-to-day
operations of that station, the
Commission’s attribution rules do not
depend on—or even reference—such
involvement. Instead, officers and
directors are attributable owners
because holders of such positions have
a realistic potential to affect station
programming or core operations. While
the extent to which NCE officers or
directors are involved in day-to-day
station operations may vary, this
situation is not unique to NCE stations
and does not provide a basis for
different treatment.
51. The Commission’s rules do,
however, allow officers and directors to
be exempted from attribution in limited
circumstances. Specifically, an officer or
director can be exempted from
attribution in an entity that is involved
in businesses other than broadcasting,
provided that his or her duties are
wholly unrelated to the operation of the
broadcast station(s) at issue. One
commenter questions whether such
exemptions are available in the NCE
context. The Commission reiterates that
its attribution standards, including the
standards applicable to attribution
exemptions for officers and directors,
apply to both commercial and NCE
stations. The Commission’s revised
Form 323–E, like its current and revised
versions of Form 323, reflects the
attribution exemption for certain
officers and directors. The Commission
reminds filers, however, that an
attribution exemption cannot be
invoked for an officer or director unless
he or she does not, and will not, have
the ability to influence the broadcast
operations of the licensee or station(s).
52. The Fourth Diversity Further
Notice also asked for input concerning
the burden of providing race and gender
information on Form 323–E. Several
commenters argue that requiring the
collection and reporting of such
information would be unduly
burdensome and might discourage
board participation. Similarly, several
commenters argue that requiring filers
to report CORES FRNs or RUFRNs for
attributable interest holders on Form
323–E would be unduly burdensome
and would discourage individuals from
serving on the boards of NCE stations.
As explained below, the Commission
also rejects these arguments. Other
commenters argue that the collection of
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race and gender information would be
minimally burdensome and agree with
the Commission’s tentative conclusion
that such information is necessary to
construct a complete picture of minority
and female participation in
broadcasting. As a result of the
Commission’s commitment to obtaining
robust and complete ownership data
concerning minority and female
participation in broadcasting, the
Commission believes that the collection
of this information about the NCE
station category is necessary. The
absence of such information with
respect to NCE stations restricts the
Commission’s ability to
comprehensively consider
broadcasting’s impact in local markets.
The GAO Report specifically identified
the Commission’s failure to collect this
race, gender, and ethnicity information
from NCE stations as a key reason that
the agency lacks comprehensive data on
ownership of broadcast outlets by
minorities and women. Moreover, the
Commission is unconvinced that
providing this information would be
burdensome or discourage participation
because many NCE stations already
provide similar information in an
annual report to the Corporation for
Public Broadcasting (CPB). Of the
approximately 4,500 NCE FM and
television stations, CPB provides
financial support to approximately
1,400 stations (FM and television).
Stations that receive funding must
submit an annual Station Activity
Survey (SAS), which collects, among
other data, general race/ethnicity
information by gender of the stations’
board members (e.g., two AfricanAmerican female board members and
one Hispanic male board member). CPB
then issues an annual report that
provides an overview of diversity in the
public media industry, including
programming and station employment
and operation, though the report does
not necessarily provide a breakdown of
the demographic information collected
with respect to the board members of
individual stations. The record does not
reflect that the CPB reporting is
burdensome or discourages
participation, and the Commission does
not believe that providing similar
information to the Commission would
have a significantly different impact.
Stations that receive CPB support
already have procedures for the
collection and reporting of similar
demographic information on board
members of these station licensees to a
third party. The Commission notes,
however, that for various reasons, the
CPB data collection cannot be used as
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a substitute for the data collected on
Form 323–E. For example, CPB does not
collect information from all NCE
stations; CPB data does not contain the
same level of detail necessary to provide
the snapshot of ownership data to
effectively study and analyze ownership
trends together with Form 323 data;
there is no way to incorporate CPB’s
data into LMS to create a searchable and
aggregable database; and there is no
public access to CPB’s underlying data
to permit analysis and study.
Additionally, the other actions adopted
herein should reduce the burdens on all
filers. Therefore, the Commission
believes that any additional burdens
associated with providing race, gender,
and ethnicity information are
outweighed by the benefits of requiring
the reporting of such information.
53. RUFRNs are Necessary to
Uniquely Identify NCE Attributable
Interest Holders. The Sixth Diversity
Further Notice, 78 FR 2925, Jan. 15,
2013, FCC 12–166, rel. Jan 3, 2013,
tentatively concluded that obtaining and
reporting a CORES FRN for individuals
identified on Form 323–E is not
burdensome and sought comment.
Similarly, in the Seventh Diversity
Further Notice, 80 FR 10442, Feb. 26,
2015, FCC 15–19, rel. Feb. 12, 2015, the
Commission proposed to permit an
individual listed on Form 323–E to
obtain and provide an RUFRN, in lieu
of a CORES FRN, for use on broadcast
ownership filings if the Commission
modifies the Form 323–E requirements
as described in the Fourth Diversity
Further Notice, 74 FR 25205, May 27,
2009, FCC 09–33, rel. May 5, 2009. The
Commission has reviewed the record
with respect to these issues and
concludes that extending the RUFRN
requirement to Form 323–E is necessary
to help ensure the reliability of the
broadcast ownership data the
Commission collects. By this Report and
Order, the Commission will require
attributable entities to obtain and report
a CORES FRN on Form 323–E, as
proposed in the Sixth Diversity Further
Notice. While this Report and Order
discusses the availability of the RUFRN
to attributable individuals, it does not
preclude individuals from reporting a
CORES FRN or SUFRN provided it is
done so in accordance with the
restrictions outlined herein.
54. While some commenters support
the Commission’s conclusion that
RUFRNs are essential to allow analysis
of the data, other commenters dispute
that position. For instance, AETC et al.
claim that the Commission has failed to
demonstrate why the proposed RUFRN
requirement is necessary to track
broadcast ownership. Similarly, the
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University of Utah and the Utah State
Board of Regents et al. argue that the
benefits derived from the use of
RUFRNs on Form 323–E filings ‘‘would
be marginal, at best.’’ The University of
Utah and the Utah State Board of
Regents et al. assert that, in the
noncommercial context, the
Commission has not identified a
diversity problem that additional
reporting requirements would help to
solve. Noncommercial stations are
already required to implement
numerous diversity initiatives in order
to receive funding from CPB, and unlike
commercial stations, NCEs are also
subject to political pressures to promote
diversity, state the University of Utah
and the Utah State Board of Regents et
al. Diversity is also identified as an
explicit goal in the governing
documents of many NCE broadcast
licensees, the commenters assert.
Further, the University of Utah and the
Utah State Board of Regents et al. argue,
even if the new reporting requirements
enable the Commission to identify a
diversity problem, it is unclear what
remedial measures the Commission
could take in the noncommercial
context. Any remedial measures would
presumably rely on market-based
incentives to lower the economic or
regulatory cost of ownership, which
would be irrelevant to NCEs given that
board membership is not determined by
the cost of investment in broadcast
properties or prospective financial gain
from broadcast station ownership, state
the University of Utah and the Utah
State Board of Regents et al. According
to the Public Broadcast Licensees, the
ability to cross reference based on a
unique identifier ‘‘has little or no
relevance to the NCE industry,’’ where
the existence of multiple broadcast
interests is ‘‘quite rare’’ in the case of
NCE board members and directors.
Similarly, Public Broadcast Licensees
assert that the proposal to eliminate a
filer’s obligation to disclose other
attributable broadcast interests of
attributable parties listed in the filing
has ‘‘little or no relevance’’ to NCE
stations, because unlike commercial
stations, ‘‘where individuals often have
multiple commercial broadcast
interests, the existence of such interests
is in fact quite rare in the case of NCE
board members and officers.’’
55. The Commission disagrees. The
Commission believes a unique identifier
for each individual attributable interest
holder is necessary to make the NCE
data aggregable, machine readable, and
searchable in the same manner as
commercial broadcast station
information. As the GAO recognized, to
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fully understand and analyze the
ownership of broadcast stations, NCE
stations must be included in the
ownership data the Commission
collects. As described above, the
Commission’s experience with the
commercial biennial ownership reports
from 2009, 2011, and 2013 revealed that
use of SUFRNs is not workable to create
data reliability and the record of this
proceeding offers no reason to believe
that use of SUFRNs in broadcast
ownership reports for NCE stations
would likely be any more successful.
The presence of the RUFRN on the
reports for noncommercial stations will
allow the tracking of ownership trends
over time and allow the Commission to
determine with certainty the presence of
multiple broadcast interests.
56. Obtaining an RUFRN is Not
Burdensome in the NCE Context.
Several commenters argue that the
CORES FRN and RUFRN requirements
would be unduly burdensome and
would discourage people from serving
on the boards of NCE stations. Parties
also state that licensees may have
difficulty obtaining the necessary
information from board members, some
of whom are appointed governmental
officials. The Commission finds that the
process for obtaining a CORES FRN or
RUFRN is quite simple and will only
need to be done once. While the
Commission recognizes that the first
time they file the new Form 323–E, NCE
filers may require additional time and
effort to coordinate with attributable
interest holders, the Commission finds
that the lead time between now and the
2017 filing window should be sufficient.
The Commission is not persuaded that
the requirement will significantly
inhibit individuals from serving on the
boards of NCEs. The Commission notes
that the individuals at issue are already
attributable interest holders in NCE
stations and they are already identified
as such on Form 323–E. With respect to
obtaining an FRN, each attributable
interest holder has the option of
obtaining either a CORES FRN,
requiring the submission of an SSN to
the Commission, or an RUFRN,
requiring the submission of other
limited personal information, including
only the last four digits of the SSN. The
attributable individual need not share
any of the personally identifying
information with anyone other than the
Commission; he or she may obtain the
FRN number directly from the
Commission and provide only the FRN
to the licensee and the public. The
Commission will house the personal
information confidentially and securely.
Under such circumstances the
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Commission does not believe the FRN
requirement would serve as a serious
disincentive to participation in NCE
stations. SUFRNs will be available for
use on Form 323–E in the limited
circumstances described below.
C. Limited Availability of SUFRNs
57. In the Seventh Diversity Further
Notice, 80 FR 10442, Feb. 26, 2015, FCC
15–19, rel. Feb. 12, 2015, the
Commission sought comment on
whether the SUFRN should continue to
be available to filers of broadcast
ownership reports in the event that after
a filer has used reasonable and goodfaith efforts, reportable individuals are
unwilling to provide their identifying
information or unwilling to obtain and
provide a CORES FRN or RUFRN
themselves. The Commission also asked
whether filers should be required to take
specific steps to substantiate that they
have used reasonable and good-faith
efforts, including informing reportable
interest holders of their obligations and
the risk of enforcement action if they
fail to provide an RUFRN, CORES FRN,
or identifying information sufficient to
permit an RUFRN or CORES FRN to be
obtained on their behalf. Some
commenters urge the Commission to
discontinue the use of interim SUFRNs
entirely and to use its enforcement
authority against anyone not willing to
comply with the ownership reporting
obligations. According to UCC et al., the
Commission’s use of its enforcement
authority should include license
revocations. In addition, UCC et al.
claim that some broadcasters ‘‘simply
do not file Form 323 at all, contrary to
Bureau instructions,’’ and urge the
Commission to ‘‘fix this problem.’’
Other commenters generally support the
proposal to retain the SUFRN but argue
that the Commission should not use its
enforcement authority or require filers
to substantiate their reasonable goodfaith efforts to comply with the
ownership reporting requirements. John
Q states that the Commission should
allow continued use of SUFRNs but
limit each person to one SUFRN and
store all SUFRNs within CORES.
58. The Commission confirms that
SUFRNs will remain available for the
limited purpose of protecting the
position of filers in the case of interest
holders that refuse to obtain an FRN or
provide the licensee with the
information necessary to generate an
FRN for the interest holder. The
Commission expects that, where an
individual interest holder does not
already have a CORES FRN, filers will
acquire an RUFRN or CORES FRN for
such individuals after obtaining the
requisite identifying information, or will
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19445
instruct the individual to obtain his or
her own RUFRN or CORES FRN and to
provide the FRN to the filer for
reporting on the biennial ownership
report form. As previously noted, the
RUFRN method will avoid the need for
individuals to disclose their full SSNs to
the Commission. In order for the
Commission’s RUFRN system to be
effective, the Commission believes it is
necessary to ensure that filers are using
reasonable and good-faith efforts to
obtain RUFRNs from individuals with
reportable interests (or from CORES on
behalf of such individuals). Therefore,
the Commission concludes that filers
should be required to take specific steps
to substantiate that they are making
such efforts. The Commission finds that
instructing an individual about his or
her obligations and about potential
enforcement action are specific steps
that demonstrate ‘‘reasonable and goodfaith efforts.’’ No commenters proposed
alternative steps that would show that
such efforts are being made. The
Commission expects that filers will
inform reportable individuals of their
obligations and the risk of enforcement
action for failing to provide an RUFRN
or CORES FRN or to permit an RUFRN
or CORES FRN to be obtained on their
behalf. An SUFRN may be obtained only
if an individual still refuses to provide
a means of reporting a valid RUFRN or
CORES FRN after the filer has taken
such steps. In the event that an SUFRN
is used, the Commission may take
enforcement action against the filer and/
or the recalcitrant individual. The
commenters have offered no evidence in
the record that the prospect of
enforcement action for failing to comply
with the RUFRN requirements adopted
herein will have a chilling effect on
participation in public broadcasting.
Enforcement decisions will be made on
a case-by-case basis based on the facts
and circumstances of each unique case
before the Commission. However, the
filer itself will be exempt from
enforcement action if the filer
substantiates that it has used reasonable
and good-faith efforts as described
herein.
59. The Commission directs the
Media Bureau to include instructions
for Forms 323 and 323–E and post
language on its Form 323 and 323–E
Web site, informing reportable interest
holders of their obligation to obtain and
provide an RUFRN or CORES FRN, or
to permit an RUFRN or CORES FRN to
be acquired on their behalf, and to alert
interest holders of the risk of
enforcement action for the failure to
provide an RUFRN or CORES FRN or to
permit an RUFRN or CORES FRN to be
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obtained. While the burden to obtain an
RUFRN or CORES FRN or to permit the
filer to acquire an RUFRN or CORES
FRN falls to the interest holder, the
Commission reminds filers of their
obligation to review the biennial
ownership report and affirm that, to the
best of the filer’s ‘‘knowledge and belief,
all statements in [the ownership report]
are true, correct, and complete.’’ This
language is found on the electronic
version of Forms 323 and 323–E, which
are available on CDBS. As stated above,
the revised versions of these forms will
be implemented in LMS. This includes
verifying that the FRN reported for an
individual is correct and that no SUFRN
has been used in the absence of
reasonable and good-faith efforts to
obtain an RUFRN or CORES FRN,
including informing a recalcitrant
interest holder of the obligation and
threat of enforcement action. When
copying or importing data from a
previously-submitted ownership report,
filers must replace any SUFRNs that
appeared on the prior report with
RUFRNs or CORES FRNs before
submitting the new report to the
Commission, unless the reporting of one
or more of those SUFRNs remains
permissible under the narrow standard
set forth in this Report and Order. The
Commission notes that the biennial
nature of the filing requirement and the
existence of OMB procedural
requirements prior to full
implementation of these rules suggest
that the 2017 filing period will be the
first filing period implicated by the
requirements described herein. This
time frame mitigates any potential
burden because filers have ample time
to ensure that they have a current and
correct RUFRN or CORES FRN for the
individuals and entities reported on
Forms 323 and 323–E. The Commission
directs the Media Bureau to revise
Forms 323 and 323–E, as well as the
pop-up boxes within CDBS, to reflect
this policy change.
D. Filing Burden Reduction and
Improved Data Integrity
60. To make sound legislative,
regulatory, and policy determinations,
the Commission must have complete
and reliable broadcast ownership data.
Both GAO and the Third Circuit have
highlighted the importance of
comprehensive and reliable data. At the
same time, the Commission is mindful
of the burden ownership reporting
represents for the industry. The
Commission’s experience with Form
323 submissions for 2009, 2011, and
2013 reveals that many filings contained
errors. Such errors undermine the
Commission’s ability to electronically
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process ownership data and make it
difficult for the Commission and outside
analysts to evaluate the data.
Accordingly, the Commission finds that
certain improvements to the forms will
greatly reduce the burden on filers,
significantly streamline the filing
process, and increase the quality and
usability of the data submitted to the
Commission. These changes include
extending the biennial filing deadline
for Forms 323 and 323–E, reducing the
number of filings required, modifying
the reporting of other broadcast and
daily newspaper interests, and
additional improvements described
below. The Commission believes they
will greatly reduce the burden on filers
and increase the quality and usability of
submitted ownership data. Section and
question references in this Report and
Order refer to the current version of the
form, which is implemented in CDBS.
Because the revised version of the form
will be implemented in LMS, it will be
given a new number, and its format,
structure, and question identification
differs from the CDBS version of the
form. Several commenters suggest that
the Commission make additional, minor
modifications to its ownership report
forms and their instructions that the
Commission does not discuss in detail
here. The Commission has incorporated
certain of these changes into the revised
ownership report forms to the extent the
Commission found them appropriate
and useful. In addition to changes to the
forms and instructions, the Commission
plans to implement improvements to
CDBS, such as subform cloning features,
auto-fill mechanisms, and data saving
and validation routines, that will reduce
data-entry burdens, simplify the form
completion process, and prevent filers
from submitting inconsistent data.
61. Background. The Commission
already has taken multiple steps to
address the quality of its broadcast
ownership data, including setting
uniform ‘‘as of’’ and filing dates for
biennial Form 323 filings; expanding
the biennial Form 323 filing
requirement to include sole proprietors
and partnerships of natural persons, as
well as LPTV and Class A licensees;
revising and clarifying the instructions
to Form 323; modifying Form 323’s
electronic interface so that ownership
data incorporated into the database can
be electronically read, searched,
aggregated, and cross referenced;
building checks into Form 323 to
perform verification and review
functions and to prevent the filing of
incomplete or inaccurate data; and
simplifying completion of the form by
providing menu and checkbox options,
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as well as pre-fill capabilities, for data
entry. Actions taken in this Report and
Order to require, except in limited
circumstances, individuals with an
attributable interest in a broadcast
station to obtain either a CORES FRN or
an RUFRN and provide that FRN on
Form 323 and Form 323–E filings will
further improve the quality of the
Commission’s data. In addition, the
Commission modified Form 323 in
March 2013 to allow for more precise
reporting of data about the race(s) of
attributable individuals. The modified
version of the form eliminates the ‘‘Two
or More Races’’ category and allows
filers to select as many categories as
apply. Previously, the form provided
five specific racial categories, plus a
sixth category entitled ‘‘Two or More
Races,’’ and allowed filers to choose
only one category for each individual.
While this change was made in response
to a directive from OMB, it improves the
Commission’s ownership data by
requiring parties to submit more precise
race information for multi-racial
individuals.
62. Despite these efforts, many
ownership reports submitted to the
Commission contained errors in 2009,
2011, and 2013. As discussed above, the
Commission’s experience reviewing
those submissions revealed numerous
filing mistakes that prevented accurate
electronic processing of submitted
reports. In preparing the 2012 323
Report and the 2014 323 Report,
Commission staff (1) required many
parties to submit corrective
amendments to their biennial Form 323
filings, and (2) after reviewing
submitted filings and additional
information, manually moved
additional stations with reporting errors
to the proper ownership categories.
Nevertheless, the Commission was
unable to account for all filing errors.
Free Press submitted various
‘‘corrections’’ to the categorization of
stations in the 2012 323 Report. Many
of these ‘‘corrections’’ involved
updating the information provided with
the 2012 323 Report to account for
subsequent events, such as station
assignments and transfers. The data
collection provides a same-date
snapshot of broadcast ownership every
two years and information after October
1, 2011, is not intended to be included.
Improving the accuracy and
completeness of the data set remains a
Commission priority.
63. The Commission has solicited a
wide variety of input concerning
potential further modifications to Form
323 and Form 323–E, including changes
designed to decrease filing burdens and
reduce errors in ownership filings. For
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example, the Fourth Diversity Further
Notice, 74 FR 25205, May 27, 2009, FCC
09–33, rel. May 5, 2009, asked whether
modifications made in the 323 Order
with respect to Form 323 should also be
applied to Form 323–E and sought input
concerning additional measures to
improve data quality, including
improvements to the computer
interface, additional data-verification
measures, and steps to ensure that data
can be electronically searched,
aggregated, and cross referenced. In the
Review of Media Data Practices
proceeding, the Commission solicited
public input to improve Form 323 and
Form 323–E, including specifically
seeking burden-reducing measures and
methods to improve public access to
ownership data. The Commission also
asked for public comment concerning
the data contained in the 2012 323
Report and potential actions to improve
the quality of that data. The Sixth
Diversity Further Notice, 78 FR 2925,
Jan. 15, 2013, FCC 12–166, rel. Jan. 3,
2013, solicited additional comment on
specific proposed modifications to the
Commission’s ownership report forms
as suggested in comments submitted in
the Review of Media Data Practices
proceeding.
64. The Commission has received
extensive public input as a result of
these requests. NAB in particular
identifies burdens that complicate the
ownership report filing process for both
Form 323 and Form 323–E. As the
Commission noted in the 2012 323
Report, the complexity of the ownership
report form was a factor that led parties
to submit incomplete and/or inaccurate
ownership information. The
Commission therefore agrees that
burdens associated with preparing and
submitting biennial ownership reports
have a negative impact on the quality of
the Commission’s ownership data and
believes that reducing the amount of
time and resources required to address
the mechanical aspects of the ownership
report preparation and filing process
will allow parties to spend more time
focused on the accuracy and
completeness of the ownership
information they submit to the
Commission. The Commission believes
that modifying the filing deadline,
reducing the number of filings required,
and modifying the reporting of other
broadcast and daily newspaper interests
will improve data quality while
alleviating filing burdens. The
Commission believes the measures
discussed here reduce the number of
required filings and burdens on filers
and increase the data quality, integrity,
and usability. The Commission declines
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to adopt other suggestions from
commenters as follows: (1) Overhaul the
ownership reporting regime to require
each licensee to disclose its entire
ownership structure, including the race,
gender, and ethnicity of all attributable
interest holders, on a single filing. The
proposal lacks specificity and would not
produce a data set that is comparable to
data collected in 2009 and 2011. (2)
Create cross-references between reports
and allow parties to certify that no
changes have occurred since the
previous biennial filing date or submit
abbreviated reports addressing only
such changes, instead of filing complete
reports on each biennial deadline. These
changes are unnecessary, or of limited
utility, because CDBS already allows
users to create new ownership reports
that contain the data from prior
ownership filings quickly and easily.
For example, while a filer cannot simply
certify that there have been no changes
since the last biennial report, that filer
can, with little effort, use the
‘‘Validation and Resubmission of a
previously filed Biennial Report
(certifying no change from previous
Report)’’ option within CDBS to copy
and re-file a station’s previous biennial
Form 323. CDBS also permits users to
copy the prior biennial report and then
make edits that reflect changes. (3)
Permit parties to submit filings on paper
or via alternative methods; allowing
filers to enter ownership information
into text boxes instead of requiring filers
to provide data in a manner that allows
it to be written into the appropriate
database fields in the CDBS ownership
data tables; and allowing parties to
upload exhibits instead of entering
ownership information directly into the
electronic form. These suggestions run
counter to the Commission’s intention
to ensure, to the maximum extent
possible, that ownership data is
included in machine-readable data
fields and can be electronically
searched, aggregated, and cross
referenced.
65. Modification of Filing Dates.
Currently, Form 323 must be filed by
November 1 of odd-numbered years and
reflect ownership information that is
accurate as of October 1 of that filing
year. In the Sixth Diversity Further
Notice, 78 FR 2925, Jan. 15, 2013, FCC
12–166, rel. Jan. 3, 2013, the
Commission sought comment on its
proposal to move the due date from
November 1 to December 1, with the
October 1 ‘‘as of’’ date to remain
unchanged. NAB supports such an
extension, and no commenters oppose
providing filers with additional time for
completing and submitting ownership
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19447
reports. The Commission continues to
believe that providing filers an
additional 30 days will lead to more
accurate reporting of ownership
information without any significant
delay in the collection and analysis of
the data. The Commission makes that
change.
66. The Commission declines to adopt
proposals for different filing deadlines.
While some commenters argue that a
December 1 deadline is inconvenient for
filers and Commission staff due to the
date’s proximity to the Thanksgiving
holiday and other Commission filing
deadlines, those commenters fail to
suggest an alternative date. Further, the
Commission finds that the 60-day
period between the ‘‘as of’’ date and the
filing date should provide sufficient
flexibility for filers such that other
deadlines or holidays do not complicate
compliance. Filers can file any time
from October 1 through December 1.
MMTC asks that the Commission
impose an annual, rather than biennial,
ownership reporting obligation. At this
time, the Commission believes that any
marginal benefit of having an annual
rather than a biennial snapshot of
ownership data is outweighed by the
additional burden such a requirement
would place on licensees to undertake
the full reporting obligation twice as
often.
67. The Fourth Diversity Further
Notice, 74 FR 25205, May 27, 2009, FCC
09–33, rel. May 5, 2009, asked whether
the Commission should adopt uniform
filing and ‘‘as of’’ dates for Form 323–
E. The Commission will require NCE
filers to submit Form 323–E in
accordance with the same ‘‘as of’’ date
and filing deadline applicable to
commercial broadcasters (i.e., their
filings will be due on December 1 of
odd-numbered years and the ownership
information provided should be current
as of October 1 of the filing year).
Currently, NCE stations submit biennial
Form 323–E in accordance with a set of
rolling deadlines. Each NCE station’s
biennial deadline is keyed to the
anniversary of the date on which its
license renewal application is required
to be filed. The information contained
on each report must be current as of no
more than 60 days prior to the filing of
that report. At least one commenter
argues that these current deadlines
should remain in place. When adopting
uniform filing and ‘‘as of’’ dates for
Form 323, the Commission noted that,
as a result of the prior, rolling deadlines,
‘‘new data are continually incorporated
into the database as it is filed, mixing
new data and old data . . . [which] has
impeded the ability to perform timerelated comparisons using our
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database.’’ Thus, in order to ‘‘[t]o make
the data easier to work with, to address
the problems created by the staggered
ownership report filing deadlines
currently in effect, and to facilitate
studies of ownership,’’ the Commission
required all biennial Form 323 filers to
submit reports by November 1, with
data current as of October 1. The same
reasoning applies equally to Form 323–
E and convinces the Commission to
require NCE stations to file according to
the same schedule.
68. Some commenters suggest that, to
reduce the burden on NCE broadcasters
and their counsel, any uniform filing
date for Form 323–E should be in the
first quarter, to correspond to a date that
certain NCE stations submit similar data
to CPB. This suggestion would not allow
the Commission to obtain the
synchronized data needed to evaluate
minority and female participation in
broadcasting over all the services over
time. Moreover, since not all NCE
stations submit data to CPB, efforts by
the Commission to coordinate with CPB
would not fully address the filing
deadline issue.
69. Reduction in the Number of
Required Filings. The current version of
Form 323 allows parent entity filers to
list only one subsidiary licensee and its
associated stations. As a result, parent
entities with multiple licensee
subsidiaries must file separate
ownership reports for each of those
licensees. In most cases, these reports
are virtually identical to each other
except for the details concerning the
licensee and station(s) involved. The
number of separate filings that a
broadcaster must file under the current
version of Form 323 depends on the
characteristics of that licensee’s
ownership structure, including the
number of licensees and parent entities
and the relationships that those entities
have to each other. In order to reduce
the number of filings submitted to the
Commission, NAB suggests that the
Commission modify Form 323 to allow
parents with several wholly owned
licensee subsidiaries to list all of those
licensees and their associated stations
on a single report. In the Sixth Diversity
Further Notice, 78 FR 2925, Jan. 15,
2013, FCC 12–166, rel. Jan. 3, 2013, the
Commission solicited comment on this
proposal and asked whether it should be
expanded to allow parent entities to file
consolidated reports for all of their
licensee subsidiaries, regardless of
whether or not those subsidiaries are
wholly owned. No commenters oppose
these proposals, and NAB indicates that
it approved of the Commission’s
expanded version.
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70. The Commission believes that
modifying Form 323 to allow a parent
entity with multiple licensee
subsidiaries to file one report that
covers all of those licensees will greatly
reduce the burden on many filers with
no negative impact on the quality of the
Commission’s ownership data. In some
cases, an entity is both a licensee and
the parent of one or more licensees.
Such an entity must file two separate
reports—one as a licensee and one as a
parent company. The Commission
therefore makes the following three
changes to Form 323: (1) The
Commission modifies the form to allow
parent filers to list multiple subsidiary
licensees and the stations associated
with those licensees, (2) the
Commission deletes the portion of
section II–A, question 3(a) (nonbiennial), and section II–B, question 3(a)
(biennial), asking filers to identify the
relationship that each reportable
individual or entity has to the licensee,
and (3) the Commission deletes section
II–B, question 4 (biennial), asking each
parent filer to identify the entity or
entities directly below it in the
licensee’s ownership chain. The revised
version of Form 323–E is consistent
with these modifications as well. The
Commission makes the second change
to allow a parent entity to file a
consolidated ownership report even if
an individual listed in response to
question 3(a) on the parent’s report does
not have the same direct interests in all
of the parent’s licensee subsidiaries. For
example, an individual might hold
officer positions in the parent and its
radio licensee subsidiaries, but not in
the parent’s television licensee
subsidiaries. Because the responses to
question 3(a) on the report for each
licensee include information concerning
the relationship between each
attributable party and that licensee, this
modification will have no impact on the
completeness of the Commission’s
ownership data. The third change will
ensure that a parent entity can file a
consolidated report in situations where
it holds interests in some of its licensee
subsidiaries directly and some
indirectly and/or it holds its various
subsidiary licensees through different
intermediate entities. The Commission
added section II–B, question 4
(biennial), to the revised version of
Form 323 in an effort to improve the
ability of researchers and others to cross
reference ownership report data and
construct complete ownership
structures. Experience has
demonstrated, however, that
information provided in response to
section II–A, question 3(a) (non-
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biennial), and section II–B, question 3(a)
(biennial), is sufficient for these
purposes.
71. Improvements to Reporting of
Other Broadcast and Daily Newspaper
Interests. In the Review of Media Data
Practices proceeding, NAB requested
that the Commission eliminate section
II–B, question 3(c), of Form 323, which
requires a filer to disclose the other
attributable newspaper and broadcast
interests of attributable parties listed in
response to section II–B, question 3(a).
The Commission’s revised Form 323–E,
like the current version of the form,
requires disclosure of other broadcast
interests, but does not require disclosure
of other daily newspaper interests. NAB
argues that submission of this data is
particularly burdensome, requiring
significant amounts of data entry and
file uploading via a series of subforms
or spreadsheet attachment(s). The
Commission sought comment on NAB’s
proposal in the Sixth Diversity Further
Notice, 78 FR 2925, Jan. 15, 2013, FCC
12–166, rel. Jan. 3, 2013. NAB reiterates
its support, and no commenters oppose
the proposal.
72. As discussed in more detail
below, the Commission declines to
eliminate section II–B, question 3(c),
entirely. Nevertheless, the Commission
believes that modifications to the
reporting requirements for other
attributable broadcast and daily
newspaper interests will reduce filing
burdens and improve both the quality
and the usability of the Commission’s
ownership data. Specifically, the
Commission takes the following actions
with respect to the reporting of other
broadcast interests on Form 323: (1) The
Commission deletes the broadcast
interests portion section II–B, question
3(c); (2) the Commission adds simple
yes/no buttons to the relevant subforms;
and (3) the Commission modifies the
public search capabilities of its
electronic filing system to allow users to
search ownership report filings by FRN
and output the results as either a list of
reports or a list of stations. Several
commenters requested that the
Commission add search capabilities of
this type. Taken together, these three
changes will simplify reporting and
allow interested parties to determine the
other broadcast interests held by
reported individuals and entities, if any,
in a straightforward manner.
73. Two factors make these changes
possible. First, the Commission’s
implementation of the RUFRN
requirement will make the FRN
information in the Commission’s
ownership database more useful as a
means to cross reference information
across multiple filings. Second,
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information concerning the other
attributable broadcast interests of a
party listed on one biennial ownership
report is contained in one or more other
biennial ownership reports (i.e.,
report(s) filed in connection with that
party’s other attributable stations). As a
result of these two factors, parties that
use the additional FRN-based search
capabilities the Commission adds to its
electronic filing system, as well as
parties that download the Commission’s
ownership data and work with it
directly, can create lists of broadcast
interests associated with particular
entities and individuals easily and
reliably, rendering the XML
spreadsheets previously required for the
broadcast portion of question 3(c)
unnecessary.
74. Section II–B, question 3(c), in the
biennial section of Form 323 also
requires the respondent to provide
information concerning the attributable
daily newspaper interests held by
parties that hold attributable interests in
the respondent. The Commission will
not delete this portion of the question.
Unlike information about broadcast
interests, information concerning daily
newspaper interests does not appear
anywhere on Form 323 except in
responses to question 3(c). In other
words, an interest holder’s daily
newspaper interests cannot be
ascertained except in direct response to
this question. The Commission therefore
cannot remove the newspaper interests
portion of section II–B, question 3(c),
without sacrificing the quality and
completeness of the Commission’s data.
The Commission notes that, because
reported newspaper interests generally
are significantly fewer than the
broadcast interests implicated in the
first part of the question, eliminating the
daily newspaper inquiry would be of
limited value in reducing filing burdens.
Moreover, the Commission believes that
a slight modification to this question
will improve the quality of the
Commission’s Form 323 data collection
and enhance the ability of parties to
search, aggregate, and cross reference
the Commission’s broadcast ownership
data. Specifically, the Commission
modifies the relevant subforms and
attachments to require filers to provide
an FRN for each person and entity
listed. Any FRN reported in response to
question 3(c) is already required in
response to question 3(a). Accordingly,
this modification to question 3(c) does
not mandate the submission of any
additional information or require any
person or entity to obtain an RUFRN or
CORES FRN that is not already required
to do so.
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75. Finally, the reasoning in support
of the modifications to the reporting of
broadcast interests discussed above
applies equally well to both the biennial
and the non-biennial sections of Form
323, as well as to Form 323–E.
Accordingly, the Commission applies
these changes to both sections of Form
323, and includes parallel modifications
to both sections of the revised version
of Form 323–E. Moreover, the
Commission applies its modifications to
the reporting of newspaper interests to
both the biennial and non-biennial
sections of Form 323, because they
share a common underlying rationale.
The Commission believes these changes
will further reduce filing burdens and
improve the quality of its ownership
data. As part of making these
modifications, the Commission will
eliminate the relevant inconsistencies
between the forms and the instructions
noted by NAB in the Review of Media
Bureau Data Practices proceeding.
76. Addition of Tribal Nation/Entity
Designation. In the Review of Media
Bureau Data Practices proceeding, the
Bureau asked, among other things,
whether it should collect additional
data and for what purpose(s) and how
the Bureau’s data collections could be
improved. In addition, the Fourth
Diversity Further Notice sought
comment concerning what data would
meaningfully expand the Commission’s
understanding of minority and female
ownership, including information to
determine if NCE stations are serving
underserved audiences. In response to
the Fourth Diversity Further Notice, 74
FR 25205, May 27, 2009, FCC 09–33, rel.
May 5, 2009, two commenters suggest
that the Commission include a
designation within Form 323–E to allow
parties to identify Tribal entities. No
parties oppose this request.
77. The Commission agrees that
collecting information on a biennial
basis concerning participation of Tribal
Nations and Tribal entities in
broadcasting will help the Commission
evaluate service to underserved and
minority populations. Moreover, such
data will help inform the Commission’s
ongoing efforts to expand broadcast
opportunities for Tribal Nations and
Tribal entities, as developed in the
Commission’s Rural Radio proceeding.
The Tribal Priority adopted in the Rural
Radio proceeding benefits federally
recognized American Indian Tribes and
Alaska Native Villages, or Tribal
consortia, and entities majority owned
or controlled by such Tribes, proposing
service to Tribal lands (or the equivalent
thereto). Because these efforts involve
both commercial and noncommercial
broadcasting, and in light of the
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Commission’s ongoing efforts to
improve its broadcast ownership data
collections, the Commission believes
that the rationale for adding a Tribal
Nation/entity designation to Form 323–
E applies equally to Form 323. In
addition, collection of this information
on a biennial basis will be minimally
burdensome, and any increased burden
is outweighed by the significant burdenreducing measures adopted elsewhere
in this Report and Order. Accordingly,
the revised versions of both Form 323
and Form 323–E allow (but do not
require) filers to indicate whether or not
licensees and/or attributable entities are
Tribal Nations or Tribal entities. For
purposes of the Tribal Priority in the
Rural Radio proceeding, the
Commission defined a Tribe as any
Indian or Alaska Native Tribe, band,
nation, pueblo, village or community
which is acknowledged by the Federal
government to constitute a governmentto-government relationship with the
United States and eligible for the
programs and services established by
the United States for Indians. The
Commission uses the same definition
for purposes of implementing the
Commission’s Tribal Nation/entity
designation. The criteria used by the
Commission to award a Tribal Priority
in the licensing context rely on this
definition, but include additional
factors as well.
78. Improved Data Practices. As noted
above, the Commission noticed its
intent to improve the Form 323 and
323–E data collections and sought
comment on improvements and burdenreducing measures in the Review of
Media Data Practices proceeding. The
Commission also asked for public
comment concerning the data contained
in the 2012 323 Report and potential
actions to improve the quality of that
data. In furtherance of these ongoing
efforts to improve data quality, reduce
filing burdens, and improve public
access to ownership data, the
Commission makes minor changes to its
ownership report forms. These include:
(1) Clarifying reporting of 47 CFR
73.3613 documents on Form 323 and
Form 323–E, (2) adding a category to
Form 323 for Limited Liability
Companies, (3) eliminating the
capitalization question from Form 323,
and (4) adding a designation to Form
323 for jointly held interests. The
Commission also makes modifications
to the instructions for the form(s)
consistent with these changes. The
Commission did not receive positive or
negative comments concerning the
changes described below, except as
indicated.
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79. First, the Commission reduces
burdens and improves both the quality
and usability of the Commission’s
ownership data by clarifying the manner
in which filers should report contracts
and other instruments that must be filed
pursuant to section 73.3613 of the
Commission’s rules. As part of this
clarification, the Commission will
eliminate the relevant inconsistencies
between the forms and the instructions
noted by NAB in the Review of Media
Bureau Data Practices proceeding. Form
323, section II–A, question 1 (nonbiennial), and section II–B, question 1
(biennial), requires commercial fullpower television stations, AM radio
stations, and FM radio stations to list all
73.3613 documents. The relevant
requirement applies to full-power
television stations, AM radio stations,
and FM radio stations. The requirement
does not apply to Class A television or
LPTV stations. Accordingly, licensee
entities that only hold licenses for Class
A television and/or LPTV stations
should answer ‘‘N/A’’ to this question.
The Commission updates Forms 323
and 323–E and the instructions for both
forms to make this clear. Form 323–E,
section II, question 5, imposes the same
obligation on NCE filers. The
respondent on a given report may or
may not be a party to these contracts
and instruments. For example, certain
credit agreements may include one or
more of the licensee’s parent entities as
parties, but not the licensee. Similarly,
network affiliations often include some,
but not all, of the entities in a station’s
ownership structure as parties. Some
filers list all relevant documents on the
licensee’s ownership report, while other
filers opt to list different documents on
different reports (perhaps based on
whether or not the respondent is a party
to the document). The latter approach
requires filers to include different, often
overlapping, lists of documents on
multiple reports and forces researchers
and other parties to examine all of a
station’s ownership filings to construct
a complete list of that station’s required
contracts and instruments.
80. To address these issues, the
Commission modifies the relevant
questions on Form 323 and Form 323–
E to require all section 73.3613
documents for a station to be listed on
the report for that station’s licensee.
Under the Commission’s rules, a fullpower television station, Class A
television station, AM radio station, or
FM radio station must have an up-todate list of all section 73.3613
documents, or copies of all such
documents, in its public file at all times.
Accordingly, licensee entities are often
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in the best position to produce the
information necessary to respond to this
question. It is therefore sensible to
require licensees’ filings to include a
complete document list. This
clarification will reduce filing burdens,
because filers will be able to enter all
required information on the licensee
report and simply check ‘‘N/A’’ for all
parent filings. Moreover, to the extent
that filers may have been providing
different document lists on various
reports for the same parent entity, this
modification helps ensure that parent
entities can file consolidated reports for
all of their subsidiary licensees. This
clarification also will improve public
access to and use of the Commission’s
ownership data, because parties
reviewing ownership reports will need
to examine only one of a station’s filings
to construct a full list of that station’s
section 73.3613 documents. As a result
of this clarification, the section 73.3613
documents question mirrors section II–
B, question 5, which directs parties to
provide an ownership chart (or similar
information) on the licensee’s
ownership report and to check ‘‘N/A’’
on all parent filings. To further improve
public review and use of the
Commission’s ownership data, the
ownership report search results screen
in LMS will indicate, for each report
listed, whether that report was
submitted for a licensee/permittee or a
parent entity. This will help users
quickly identify the filings that contain
summary contracts and ownership
structure information.
81. Second, the Commission improves
data quality by adding a category to
Form 323 for limited liability
companies. Section I, question 8, of
Form 323 requires the filer to identify
the nature of the respondent, and
currently allows the filer to choose
between categories for sole
proprietorships, for-profit corporations,
not-for-profit corporations, general
partnerships, and limited partnerships.
Respondents that do not fit into one of
these categories must select the ‘‘other’’
category and provide an explanatory
exhibit. The parallel question on the
revised version of Form 323–E includes
different categories. Accordingly, the
modification the Commission makes
here applies only to Form 323. Over the
years, limited liability companies have
become increasingly common in the
ownership structures of commercial
broadcast stations. The Commission
believes it is prudent to add a separate
category allowing parties to identify
filing entities that are limited liability
companies. The ‘‘other’’ option will
remain on the form, along with the
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ability to upload an exhibit, for
respondents that do not fit into one of
the provided categories. Adding this
category will reduce burdens on limited
liability company filers by eliminating
the need to type an exhibit. It will also
improve the Commission’s data by
placing more ownership information
into machine-readable data fields and,
thereby, improving the ability of parties
to electronically search, aggregate, and
cross reference the Commission’s
ownership data.
82. Third, the Commission reduces
burdens by eliminating Form 323,
section II–A, question 2 (non-biennial),
and section II–B, question 2 (biennial),
which requires filers to provide
capitalization information for any
respondent that is a licensee, permittee,
or entity that has a majority interest in,
or otherwise exercises de facto control
over the licensee. Neither the current
nor revised version of Form 323–E
contains this question. The Commission
can eliminate the question without
meaningfully compromising data
quality because section II–A, question
3(a) (non-biennial), and section II–B,
question 3(a) (biennial), better address
the Commission’s need to ascertain
equity ownership of, and voting rights
in, the respondent than does question 2.
Section II–B, question 3(a) (biennial),
requires information concerning both
voting and equity rights in the
respondent, while section II–A, question
3(a) (non-biennial), only requires
information concerning voting rights in
the respondent. There are at least two
reasons that the information provided in
response to question 3(a) is more useful
than the information provided in
response to question 2. First, because
question 2 only applies to entities that
issue stock (i.e., corporations), many
filers (such as partnerships and limited
liability companies) do not have to
provide any information. Accordingly,
there currently are large gaps in the
question 2 data collected by the
Commission. Question 3(a), on the other
hand, applies to all filers. Second,
question 2 does not solicit information
concerning share equity values for the
various classes of stock or the relative
voting rights of different classes of
voting stock. As a result, information
provided in response to question 2,
unlike information from question 3(a),
generally is insufficient for
understanding the voting or equity
structures of the respondent. Moreover,
eliminating the capitalization question
will reduce filing burdens on corporate
filers.
83. Fourth, in addition to the
Commission’s general desire to improve
the quality of its broadcast ownership
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data collections, the Commission’s 2012
323 Report PN evidenced a desire to
implement practical changes to Form
323 that would reduce data errors and
make the Commission’s ownership data
more complete and usable. In
furtherance of these objectives, the
Commission adds a yes/no question to
the subforms identifying attributable
parties to allow parties to identify
jointly held voting interests.
84. In certain circumstances, two or
more parties hold a voting interest in a
licensee or other respondent jointly.
Two parties may, for example, hold 100
percent of the voting interest in an
entity together, as joint tenants (as
opposed to each individual holding 50
percent of the voting interests).
Similarly, agreements for partnerships
or limited liability companies may
provide that two or more individuals
exercise voting power together, such
that any of the relevant parties can fully
exercise the voting interest. Because the
current version of Form 323 provides no
mechanism for parties to identify
situations in which voting interests are
jointly held, it is likely that filers report
such interests in different ways, which
leads to errors and inconsistencies in
the Commission’s data. For example,
faced with a situation in which parties
A and B hold a 50 percent voting
interest jointly, one filer might report
both as having a 50 percent interest
while another filer might report A and
B as holding 25 percent of the voting
interests each. Neither of these options
accurately captures the voting rights at
issue. When preparing the 2012 323
Report, the Commission found that its
inability to identify and interpret jointly
held voting interests on ownership
reports rendered it impossible for
Commission staff to electronically or
manually process those reports. Parties
reviewing non-biennial Form 323 filings
will face similar difficulties.
Accordingly, the Commission finds that
adding a question to both the biennial
and non-biennial sections of Form 323
to address this issue is a minimally
burdensome way to improve the quality
of the Commission’s ownership data.
The Commission does not believe that
there are many jointly held voting
interests in the NCE context.
Accordingly, the Commission does not
make a similar modification to Form
323–E at this time.
85. Finally, the subforms for Form 323
section II–A, question 3(a) (nonbiennial)
and section II–B, question 3(a) (biennial)
provide categories for filers to identify
each attributable party’s positional
interest in the respondent. To increase
the usability of the Commission’s
ownership data, and in light of the
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Commission’s recent decision
concerning attribution of television joint
sales agreements (JSAs), the
Commission will add a new positional
interest category that will allow filers to
identify reported parties that are
attributable by virtue of a JSA or Local
Marketing Agreement. One commenter
proposes additional reporting
requirements for parties that operate a
station pursuant to a local marketing
agreement (LMA). As an initial matter,
the Commission notes that any party
that has an attributable interest in a
commercial broadcast station by virtue
of an attributable LMA or JSA is already
required to comply with Form 323 filing
requirements for that station. This
existing requirement captures any
minority and female ownership interests
in commercial broadcast stations that
result from the operation of a station
pursuant to an attributable agreement.
The Commission declines to extend the
reporting requirement to nonattributable
operating agreements because there is
no information on the current record
that reflects that a data collection
focused on this category of
nonattributable interest holders would
meaningfully improve the data set.
E. Other Proposals
86. Commenters in this proceeding
provide several additional suggestions
relating to Form 323, Form 323–E,
procedures related to those forms, and
the Commission’s Consolidated
Database System (CDBS) that the
Commission declines to implement at
this time. The Commission discusses
those proposals briefly below. As noted
above, the Commission intends to move
Forms 323 and 323–E from CDBS to
LMS. Comments and arguments
presented herein with respect to CDBS
are equally applicable to the
Commission’s future LMS
implementation of the forms and the
associated public search capabilities.
Additional rejected proposals are
addressed elsewhere in this Report and
Order and that discussion is not
repeated in this section.
87. MMTC asks the Commission to
create a separate filing category for
transfers to bankruptcy trustees,
debtors-in-possession, or trusts, arguing
that this would help identify business
failures. The Commission declines to do
so, because the suggestion is outside the
scope of this proceeding, would be
burdensome and costly, and similar
information is available already.
Creating a new filing category would
require changes to Form 323 and Form
323–E, the associated database elements
in CDBS, and also changes to the
Commission’s forms for assignments
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and transfers of broadcast
authorizations, the database
infrastructure associated with those
forms, and the Public Access portion of
CDBS. The record does not demonstrate
sufficient utility of the information to
justify these costly undertakings. In any
event, parties can use the public access
portion of CDBS to obtain information
concerning individual transactions,
including those that involve
assignments or transfers to bankruptcy
trustees, debtors-in-possession, or trusts.
The Public Access portion of CDBS
allows users to search for assignment
and transfer applications based on
multiple criteria, including call sign,
Facility ID Number, service, station
location (city and state), application file
number, and applications status. This
electronic system also gives users access
to the full content of each assignment
and transfer application, including the
portions that describe the parties to the
application and the nature of the
underlying transaction(s), and provides
information about legal actions
pertaining to those applications. The
Commission intends to implement these
functions in LMS as well.
88. Several commenters ask the
Commission to modify its electronic
filing systems, the Public Access portion
of CDBS, or the online instructions for
CDBS. For example, parties ask the
Commission to create new filing
systems for parties with limited
broadband access and/or update CDBS
accounts to recognize the type of entity,
list only reports applicable to that
entity, indicate previous filings and
dates, allow users to pre-populate
entries in new reports based on prior
reports (including forms of different
types), and provide automated filing
reminders. Several of these capabilities
already exist in CDBS. For example, if
a party uses the same CDBS account for
all of its filings, that account already
contains the station’s prior filings as
well as information about those filings,
including submission dates. CDBS in
many cases allows users to pre-populate
new ownership reports by copying or
prefilling data from another filing of the
same type. CDBS pre-populates data in
some other situations as well. For
example, when a party launches a
covering license application in CDBS,
the system often pre-populates some
information from the related permit
application. Similarly, CDBS uses
information in the Account
Maintenance menu to prefill
respondent, applicant, and contact
representative information into
applications. The Commission intends
to implement similar functions in LMS
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as well. To utilize these and other
burden-reducing capabilities in CDBS,
filers sometimes use different CDBS
accounts for different types of filings
and different entities. The Commission
does not want filers to lose the ability
to benefit from that practice. The
remaining suggestions are either
technically infeasible or impose
significant costs on the Commission that
appear to exceed any possible benefits
at this time. Other commenters suggest
various enhancements to search
capabilities within the Public Access
portion of CDBS, including searching
ownership reports by gender, race,
ethnicity, voting percentage, and equity
percentage; displaying explanatory
messages when searches produce no
results; and alerting searchers about
assignment and/or transfer applications.
Broadband Institute of California also
requests that the Commission allow
users to search ownership reports by
station call sign. The Public Access
portion of CDBS already provides the
ability to do so. It should be noted,
however, that because station Facility ID
Numbers, unlike station call signs, are
permanent, Facility ID Number searches
provide more reliable results than call
sign searches. Researchers and other
parties currently can download the data
files from the Commission’s Web site at
any time and study, search, and
manipulate the data in a wide variety of
ways. This suggests that developing an
extensive catalog of complex query
options within the public search
functionality of the Commission’s
electronic filing system would impose
unnecessary costs on the Commission.
UCC et al. argue that the form in which
the Commission makes its broadcast
ownership data available to the public
renders the data incapable of being
searched, aggregated, and cross
referenced electronically. This is
incorrect. The Commission has ensured
that the data submitted on Form 323 are
incorporated into a relational database,
the most common database format,
which is standard for large,
complicated, interrelated datasets. It is
available to the public. Complete raw
data from the Commission’s broadcast
ownership filings, both current and
historical, are available for download
via a Web page on the Commission’s
Web site, and it is updated on a daily
basis to account for new and amended
filings. Users can access and manipulate
the data in almost limitless ways. The
Commission has also made explanatory
documents publicly available and easy
to find. These steps represent extensive
progress towards the goal of making
ownership data available to the public
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in a form that is capable of being
electronically searched, aggregated, and
cross referenced.
89. Finally, several commenters ask
that the Commission not audit
ownership data submitted by NCE
stations and/or that NCE entities be
subject to reduced compliance
standards and/or forfeitures. The
Commission believes that in order to
maintain and improve the quality of
both its commercial and noncommercial
ownership data, the Commission must
have the ability to audit broadcast
ownership data and hold parties
responsible for their submissions.
Accordingly, the Commission declines
to make any changes to its approach to
ownership report data audits and
related forfeitures at this time.
IV. Procedural Matters
A. Final Regulatory Flexibility Analysis
90. As required by the Regulatory
Flexibility Act of 1980, as amended
(RFA), the Commission incorporated an
Initial Regulatory Flexibility Analysis
(IRFA) of the possible significant
economic impact on a substantial
number of small entities by the policies
and rules proposed in the Fourth
Diversity Further Notice of Proposed
Rulemaking (Fourth Diversity Further
Notice), the Sixth Diversity Further
Notice of Proposed Rulemaking (Sixth
Diversity Further Notice), and the
Seventh Diversity Further Notice of
Proposed Rulemaking (Seventh
Diversity Further Notice). No comments
were filed addressing the IRFA
regarding the issues raised in these
further notices of proposed rulemaking.
Because the Commission amended the
rules in the Report and Order, Second
Report and Order, and Order on
Reconsideration (Report and Order), the
Commission has included this Final
Regulatory Flexibility Analysis (FRFA).
This present FRFA conforms to the
RFA.
1. Need for, and Objectives of, the
Report and Order
91. The Report and Order enhances
the collection of data reported on FCC
Form 323, Ownership Report for
Commercial Broadcast Stations, and
FCC Form 323–E, Ownership Report for
Noncommercial Broadcast Stations, to
improve the data available to analyze
issues relevant to ownership and
viewpoint diversity. These
improvements are designed to advance
the Commission’s long-standing goal of
promoting diversity in ownership of
broadcast stations to ensure that diverse
viewpoints and perspectives are
available to the American people in the
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content they receive over the broadcast
airwaves. In pursuit of this goal, the
Commission has a long history of
promulgating rules and regulations
intended to foster diversity in terms of
minority and female ownership. A
necessary precursor to the
Commission’s rulemaking efforts is the
collection of comprehensive, reliable
data reflecting the race, gender, and
ethnicity of the owners and other
interest holders in broadcast stations.
Such data are essential to effectively
study and analyze ownership trends, to
assess the impact of Commission rules,
and to provide the foundation for the
consideration of new rules, among other
things. To be useful for this purpose, to
the greatest extent possible the data
must be capable of being read, verified,
searched, aggregated, and crossreferenced electronically.
92. Accordingly, pursuant to the
Commission’s statutory mandate
contained in section 257 of the
Telecommunications Act of 1996 (the
1996 Act) and section 309(j) of the
Communications Act of 1934 (the Act)
to promote opportunities for small
businesses and women and minorities
in the broadcasting industry, the
Commission implements a Restricted
Use FRN (RUFRN) within the
Commission’s Registration System
(CORES) that individuals may use solely
for the purpose of broadcast ownership
report filings. The Commission believes
that the RUFRN will allow for sufficient
unique identification of individuals
listed on broadcast ownership reports
without necessitating the disclosure to
the Commission of individuals’ full
Social Security Numbers (SSNs). In light
of the adoption of the RUFRN
requirement, the Commission eliminates
the availability of the Special Use FRN
(SUFRN) for broadcast station
ownership reports, except in very
limited circumstances as further
described herein. The Commission also
prescribes revisions to Form 323–E that
conform reporting for noncommercial
broadcast stations more closely to those
for commercial stations, including
information about race, gender, and
ethnicity of existing attributable interest
holders; the use of a unique identifier;
and the biennial filing requirement.
Finally, the Commission makes a
number of significant changes to the
reporting requirements that reduce the
filing burdens on broadcasters,
streamline the process, and improve
data quality. These changes include
extending the biennial filing deadline,
reducing the number of filings required,
improving the reporting of other
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broadcast and newspaper interests, and
other modifications.
2. Summary of Significant Issues Raised
by Public Comments in Response to the
IRFA
93. The Commission received no
comments in direct response to the
IRFAs contained in the Fourth Diversity
Further Notice, the Sixth Diversity
Further Notice, and the Seventh
Diversity Further Notice in this docket.
However, as further discussed below,
the Commission received comments that
discuss the additional burdens on
broadcast licensees, including small
entities. For reasons discussed below,
some commenters oppose the adoption
of the RUFRN requirement, the
elimination of the availability of the
SUFRN, and the expansion of the race,
gender, and ethnicity reporting for Form
323–E.
94. The actions taken in the Report
and Order advance the Commission’s
commitment to improving the
comprehensiveness and reliability of the
ownership data collected on Forms 323
and 323–E to enable more effective
analysis of ownership trends in support
of policy initiatives promoting diversity
in ownership of broadcast stations. As a
result, the Commission will no longer
allow filers to use SUFRNs on biennial
ownership reports, except in limited
cases, and instead will require that on
such forms filers provide an RUFRN or
CORES FRN for any reportable
individual attributable interest holder.
In addition, the Commission updates its
reporting requirements for NCE stations
to more closely parallel the
requirements for commercial stations.
The Report and Order also makes
certain changes to the Commission’s
Form 323 and 323–E aimed at reducing
the filing burdens on broadcasters and
improving data collections. Finally, the
Commission declines to adopt certain
proposals detailed in comments in this
proceeding as redundant, unnecessary,
technically infeasible, or unsupported.
95. Availability of the RUFRN.
Currently, filers of Form 323
(Ownership Report for Commercial
Broadcasters) must provide an FCC
Registration Number (FRN) generated
via CORES for each reported attributable
party. To obtain a CORES FRN, an
individual must submit his or her SSN
to the Commission through CORES.
CORES FRNs therefore can be used to
uniquely identify individuals reported
on Form 323, which is crucial to the
quality and utility of the Commission’s
broadcast ownership data. Filers also
have the option of reporting an SUFRN
for individuals, if after good-faith
efforts, the filer is unable to report a
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CORES FRN for that individual. As
further discussed below, the
Commission finds that the existence of
SUFRNs undermines the usefulness and
integrity of the Commission’s broadcast
ownership data, because they are not
backed by identifying information that
allows the Commission to uniquely
identify an individual reported on the
biennial ownership reports.
96. In the Report and Order, the
Commission notes that it is sensitive to
the concerns raised regarding a
proposed requirement that every
individual interest holder of a broadcast
station submit his or her SSN to the
Commission for the purpose of reporting
a CORES FRN on the broadcast
ownership reports. The Commission
finds that the RUFRN (which does not
require the submission of a full SSN but
instead requires submission of full
name, residential address, date of birth,
and only the last four digits of the
individual’s SSN) will support the
Commission’s data gathering and
policy-making initiatives by providing
reasonable assurance that individuals
reported on the broadcast ownership
reports are uniquely identified in a
manner that ensures that the data
collected can be meaningfully searched,
aggregated, and cross-referenced
electronically. Moreover, the use of
SUFRNs on Form 323 has compromised
the integrity of the data collected and
frustrated the Commission’s attempts to
fulfill its statutory mandates under
section 257 and section 309(j).
Accordingly, the Report and Order
adopts the RUFRN for use on Form 323
by attributable individuals. An
individual requesting an RUFRN would
be required to submit his or her name,
date of birth, and residential address,
along with the last four digits of his or
her SSN, to CORES.
97. The identifying information
provided by the individual in order to
obtain an RUFRN will be confidentially
stored within CORES, and only the
individual’s name and RUFRN will be
available publicly. The underlying
information will be entirely machine
readable and will not require the
manual consideration of each biennial
ownership form to compare associated
name and address information to
analyze whether Form 323 entries might
identify the same individual or different
individuals. When the individual
applicant obtains an RUFRN, the
applicant will be asked to list all CORES
FRNs registered to the individual and
all SUFRNs that the individual
previously used in any broadcast
ownership report filings since the 2009
biennial reporting cycle. The
Commission concludes that this
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disclosure will allow the Commission to
identify all CORES FRNs, RUFRNs, and
SUFRNs that identify the same
individual, which will promote the
usefulness of the broadcast ownership
data for purposes of electronic
searching, aggregating and crossreferencing, and for trend analysis. Once
an RUFRN is issued, an ownership
report filing that lists the individual
associated with that RUFRN will be
required to include that RUFRN.
However, an individual may opt to use
a traditional CORES FRN instead of
obtaining and using an RUFRN.
98. The Commission also concludes
that permitting individual interest
holders the ability to obtain and report
an RUFRN in lieu of a traditional
CORES FRN will impose minimal costs
and burdens, if any, on individuals or
filers. Those that already have a CORES
FRN will be able to continue to use that
existing number without the need to
register for an RUFRN, and any
individuals interested in obtaining a
CORES FRN will still be able to do so.
Registering for an RUFRN is a one-time
process that takes a few moments to
complete, and there are at most de
minimis costs or burdens associated
with obtaining the RUFRN. The use of
the RUFRN as a unique identifier that
can be easily cross-referenced will also
enable the Commission to make certain
modifications to broadcast ownership
reporting that will reduce burdens on all
filers, as described below, and will
therefore further improve the quality of
the ownership data submitted to the
Commission. Although some
commenters argue that implementing
the RUFRN would impose specific
burdens on NCE licensees, as discussed
below, no commercial station disputes
the Commission’s finding that RUFRNs
will not be burdensome for commercial
entities.
99. Commenters also raise concerns
about the security and integrity of
CORES and argue that registering for a
CORES FRN or an RUFRN may leave
individuals vulnerable to identity theft.
The Commission agreed with
commenters that privacy and security
with respect to personally identifiable
information are paramount, and the
Commission stated that it is confident
that the steps taken and the procedures
in place assure the security of the
Commission’s systems. In fact, the
Commission stated that it is not aware
of any breaches to CORES. In the
Seventh Diversity Further Notice, the
Commission explained that it was in the
process of implementing certain
improvements before the completion of
the Information Security GAO Report,
and the Commission continues today to
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strengthen its security environment
using the recommendations included in
the Report. The CORES architecture
exceeds Federal guidelines, and the
Commission’s databases are behind
several firewalls. Administrative access
to the CORES application is limited and
all transmission of non-public data is
encrypted. Moreover, the Commission
has made numerous upgrades to its
network, including implementing
enhanced perimeter controls, malware
protection, and monitoring devices, and
upgrading workstations to operating
systems with improved security. As a
result, the Commission’s network is
stronger, better, and more secure than
ever before. Security will continue to be
one of the Commission’s highest
priorities, and the Commission will
continue to make the necessary
upgrades to ensure the security of
CORES and all of its systems. In
response to the Seventh Diversity
Further Notice, the National Association
of Broadcasters also commented that
RUFRNs, because they create a unique
identifier without requiring individuals
to submit full SSNs to the Commission,
provide a ‘safety valve’ for individuals
who might be reluctant to obtain a
CORES FRN due to data privacy
concerns.
100. Modifications to Form 323–E. To
enhance the completeness of the
Commission’s data collection, promote
data integrity, and ensure that data are
electronically readable and aggregable,
the Commission also revises Form 323–
E for NCE stations to collect race,
gender, and ethnicity information for
attributable interest holders, require that
CORES FRNs or RUFRNs be used, and
conform the biennial filing deadline of
broadcast ownership reports for NCEs
with commercial stations. The
Commission finds that it has authority
under section 257 of the 1996 Act and
section 309(j) of the Act to collect race,
gender, and ethnicity information from
attributable interest holders in NCE
stations, and the Commission affirms
the conclusion in the Fourth Diversity
Further Notice that doing so will further
the goal of designing policies to advance
diversity.
101. The Fourth Diversity Further
Notice sought comment on the proper
definition of ‘‘ownership’’ in the NCE
context, asking whether looking at the
composition of the board of directors or
other governing body of an NCE station
would be appropriate for determining
‘‘ownership’’ for Form 323–E purposes.
Several commenters support this
approach, noting, for example, that
board members have legally cognizable
duties to the station licensees, often are
involved in station operations and
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hiring decisions, have final authority
over NCE licensees, and are responsible
to the local communities they serve.
Other commenters argue that
dissimilarities between the governance
of commercial and NCE stations
precludes any definition of
‘‘ownership’’ in the NCE context. These
parties note that board members do not
have equity stakes in the stations they
serve; are often governmental officials,
governmental appointees, individuals
elected by station members, or
volunteers; and often are not involved
in day-to-day station operations.
102. The Commission finds that
officers and directors of NCE stations
already are defined as attributable
interest holders in NCE stations and that
such individuals are already identified
on Form 323–E. The additional
requirements imposed in the Report and
Order do not involve crafting or
imposing a new legal definition of
‘ownership’ with respect to NCE
stations. For purposes of Form 323 and
323–E, the concept of ownership relies
on the attribution standards set forth in
section 73.3555 of the Commission’s
rules. The Report and Order notes the
instances in which individuals or
entities may hold attributable
ownership interests in commercial
broadcast stations without holding
equity interests in those stations. For
example, an officer or director of a
commercial broadcast licensee is an
attributable owner of the licensee’s
station(s), regardless of whether he or
she has any equity interest in the
licensee. The Commission’s standards
for attributable ownership generally do
not depend on equity positions, and
many parties hold attributable interests
in stations without any equity
involvement in those stations. These
attribution standards apply to both
commercial and noncommercial
stations, and the individuals and
entities these standards capture have the
potential to exert influence over the
licensee, regardless of whether the
station at issue is commercial or
noncommercial. The Commission adds
that the observation that NCE board
members are often governmental
officials, governmental appointees,
individuals elected by station members,
or volunteers does not alter the
Commission’s view, as the attribution
standards rely not on the manner in
which that individual became a member
of the station’s governing body, but on
the ability to influence station
programming or operations of that
station that the membership confers.
Accordingly, arguments that the
Commission should not impose these
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additional requirements for NCE
stations because the individuals have no
equity ownership therefore are not
compelling. The Commission notes that
its rules do allow officers and directors
to be exempted from attribution in
limited circumstances, even in the NCE
context.
103. The Commission is unconvinced
that providing the race, gender, and
ethnicity on Form 323–E is burdensome
and would discourage board
participation. Many NCE stations
already provide similar information in
an annual report to the Corporation for
Public Broadcasting (CPB), and the
record does not reflect that the CPB
reporting is burdensome or discourages
participation. The Commission does not
believe that providing similar
information to the Commission would
have a significantly different impact,
and other actions adopted herein should
reduce the burden on all filers.
Accordingly, the Commission believes
that any additional burdens associated
with providing race, gender, and
ethnicity information are outweighed by
the benefits of requiring the reporting of
such information.
104. The Report and Order also
concludes that extending the RUFRN
mechanism to Form 323–E is necessary
to help ensure the reliability of the
broadcast ownership data it collects.
While some commenters support the
conclusion that RUFRNs are essential to
allow analysis of the data, others argue
that the RUFRNs would offer limited
utility on Form 323–E. The Commission
disagrees. The Commission believes that
a unique identifier for each individual
attributable interest holder is necessary
to make the NCE data aggregable,
machine readable, and searchable in the
same manner as commercial broadcast
station information. As the GAO
recognized, to fully understand and
analyze the ownership of broadcast
stations, NCE stations must be included.
The Commission’s experience with the
commercial biennial ownership reports
from 2009, 2011, and 2013 revealed that
use of SUFRNs is not workable to create
data reliability and the record in this
proceeding offers no reason to believe
that use of SUFRNs in broadcast
ownership reports for NCE stations
would likely be any more successful.
The presence of the RUFRN on the
reports for noncommercial stations will
allow the tracking of ownership trends
over time and allow us to determine
with certainty the presence of multiple
broadcast interests.
105. The Commission also disagrees
with commenters that argue that the
CORES FRN and RUFRN requirements
are unduly burdensome and would
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discourage people from serving on the
boards of NCE stations. The process for
obtaining a CORES FRN or RUFRN is
quite simple and only has to be
completed once. And while the first
time they file the revised Form 323–E,
NCE filers may require additional time
and effort to coordinate with attributable
interest holders, the Commission finds
that the sufficient lead time between
now and the 2017 filing window will
sufficiently mitigate any burden. The
Commission is not persuaded that the
requirement will significantly inhibit
interest holders from serving on the
boards of NCE stations as they are
already identified as such on Form 323–
E. Moreover, the attributable interest
holder need not share any personally
identifying information with anyone
other than the Commission in order to
obtain a CORES FRN or an RUFRN. The
Commission does not believe that the
RUFRN would serve as a serious
disincentive to participation in NCE
stations, and reminds filers that
SUFRNs will be available for use on
Form 323–E in the same limited
circumstances that SUFRNs will be
available to Form 323 filers.
106. Limited Availability of SUFRNs.
The Report and Order retains the
availability of the SUFRN, but only for
the limited purpose of protecting the
position of filers in the case of interest
holders that refuse to obtain an FRN or
provide the licensee with the
information necessary to generate an
FRN for the interest holder. The
Commission expects that where an
individual interest holder does not
already have a CORES FRN, filers will
acquire an RUFRN or CORES FRN for
such individuals after obtaining the
requisite identifying information, or will
instruct the individual to obtain his or
her own RUFRN or CORES FRN and to
provide the FRN to the filer for
reporting on the biennial ownership
report form. In order for the RUFRN
system to be effective, the Commission
believes that it is necessary to ensure
that filers are using reasonable and good
faith efforts to obtain RUFRNs from
individuals with reportable interests (or
from CORES on behalf of such
individuals). Filers should take specific
steps to substantiate that they are
making such efforts, and the
Commission finds that instructing an
individual about his or her obligations
and about potential enforcement action
are specific steps that would
demonstrate ‘‘reasonable and good faith
efforts.’’ An SUFRN may be obtained
only if an individual still refuses to
provide a means of reporting a valid
RUFRN or CORES FRN after the filer
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has taken such steps. If an SUFRN is
used, the Commission may take
enforcement action against the filer and/
or the recalcitrant individual. The filer
itself will be exempt from enforcement
action if the filer substantiates that it
has used reasonable and good faith
efforts as described herein.
107. The Media Bureau is directed to
include instructions for Forms 323 and
323–E and post language on its Form
323 and 323–E Web site, informing
reportable interest holders of their
obligation to obtain and provide an
RUFRN or CORES FRN, or to permit an
RUFRN or CORES FRN to be acquired
on their behalf, and to alert interest
holders of the risk of enforcement action
for failure to provide an RUFRN or
CORES FRN or to permit an RUFRN or
CORES FRN to be obtained. The
Commission anticipates that the 2017
filing period will be the first filing
period that the requirement will be
implicated, and the time frame mitigates
any potential burden because filers will
have ample time to ensure that they
have a current and correct RUFRN or
CORES FRN for the individuals and
entities reported on the Forms 323 and
323–E.
108. Filing Burden Reductions and
Improved Data Integrity. In the Report
and Order, the Commission also
implemented a number of changes to
Forms 323 and 323–E and moved the
filing deadlines in order to reduce filing
burdens and improve data quality.
109. To permit filers more time to file
Form 323, the Commission moved the
filing deadline from November 1 to
December 1. The Commission found
that the 60-day period between the
October 1 ‘‘as of’’ date and the filing
date should provide sufficient flexibility
for filers such that other deadlines or
holidays do not complicate compliance.
The Commission also adopted a uniform
filing date of December 1 for filing the
Form 323–E biennial ownership report.
In the Fourth Diversity Further Notice,
the Commission sought comment on
whether it should adopt uniform filing
and ‘‘as of’’ dates for Form 323–E.
Currently, NCE stations submit biennial
Form 323–E in accordance with a set of
staggered deadlines. Some commenters
suggested that a uniform filing date for
Form 323–E should be in the first
quarter, to correspond to a date that
certain NCE stations submit similar data
to CPB. The Commission found that this
suggestion would not allow it to obtain
the synchronized data, i.e., commercial
and noncommercial ownership data that
is captured on the same date, needed to
evaluate minority and female
participation in broadcasting over all
the services over the time. Moreover,
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because not all NCE stations submit data
to CPB, efforts by the Commission to
coordinate with CPB would not fully
address the filing deadline issue.
Accordingly, the Commission will
require NCE filers to submit Form 323–
E in accordance with the same ‘‘as of’’
date and filing deadline applicable to
commercial broadcasters (i.e., their
filings will be due on December 1 of
odd-numbered years and the ownership
information provided should be current
as of October 1 of the filing year). The
Commission required NCE stations to
file Form 323–E on the same schedule
as Form 323 in order to make the
ownership data collected by the
ownership reports easier to work with
and to facilitate ownership studies using
data captured on a uniform ‘‘as of’’ date.
110. The current version of Form 323
allows parent-entity filers to list only
one subsidiary licensee and its
associated stations. As a result, parent
entities with multiple licensee
subsidiaries must file separate
ownership reports for each of those
licensees. In the Sixth Diversity Further
Notice, the Commission sought
comment on a proposal to modify the
form to allow parents with several
wholly owned licensee subsidiaries to
list all of those licensees and their
associated stations on one report and
whether the proposal should be
expanded to allow parent entities to file
consolidated reports for all of their
licensee subsidiaries, regardless of
whether or not those subsidiaries are
wholly owned. The Commission found
that modifying Form 323 to allow a
parent entity with multiple licensee
subsidiaries to file one report that
covers all of those licensees will greatly
reduce the burden on many filers with
no negative impact on the quality of the
ownership data. Accordingly, the
Commission adopted three changes to
Form 323: (1) It modified section I,
question 7, of the form to allow parent
filers to list multiple subsidiary
licensees and the stations associated
with those licensees; (2) it deleted the
portion of section II–A, question 3(a)
(non-biennial), and section II–B,
question 3(a) (biennial), asking filers to
identify the relation that each reportable
individual or entity has to the licensee;
and (3) it deleted section II–B, question
4 (biennial), asking each parent filer to
identify the entity or entities directly
below it in the licensee’s ownership
chain. The revised version of Form 323–
E incorporates these modifications as
well. No commenters opposed these
proposals.
111. In the Review of Media Data
Practices proceeding, NAB requested
that the Commission eliminate section
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II–B, question 3(c), of Form 323, which
requires a filer to disclose the other
attributable newspaper and broadcast
interests of attributable parties listed in
response to section II–B, question 3(a).
NAB argued that submission of this data
is burdensome, requiring significant
amounts of data entry and file
uploading via a series of subforms and
spreadsheet attachment(s). The
Commission sought comment on this
proposal in the Sixth Diversity Further
Notice and no commenters opposed the
proposal. The Commission declined to
eliminate the question in its entirety,
but believes that modifications to the
reporting requirements for other
attributable broadcast and daily
newspaper interests will reduce filing
burdens and improve the quality of the
Commission’s data. Because information
concerning the other attributable
broadcast interests of a party listed on
one ownership report is contained on
one or more other ownership reports,
the Commission believes it can greatly
simplify the reporting of other broadcast
interests of attributable parties on the
biennial Form 323 without sacrificing
the completeness or usability of the
Commission’s data. In other words, the
public can ascertain a reported interest
holder’s other broadcast interests by
performing a search of other filed
ownership reports. Accordingly, the
Commission (1) deletes the broadcast
interest portion section II–B, question
3(c); (2) adds simple yes/no buttons to
relevant subforms; (3) modifies the
public search capabilities of the
electronic filing system to allow users to
search ownership report filings by FRN
and output the results as either a list of
reports or a list of stations.
112. Information concerning daily
newspaper interests does not appear
anywhere on Form 323 except in
response to question 3(c). In other
words, an interest holder’s daily
newspaper interests cannot be
ascertained except in direct response to
this question. The Commission
determined that it therefore cannot
remove the newspaper interests portion
of section II–B, question 3(c), without
sacrificing the quality and completeness
of the data. However, to improve the
quality of the data collected in response
to this question and enhance the ability
of parties to search, aggregate, and crossreference that data, the Commission
modified the subforms and the
spreadsheet attachments for the
newspaper interests portion of section
II, question 3(c), to require filers to
provide an FRN (either a CORES FRN or
RUFRN, or an SUFRN, subject to the
limitations addressed above) for each
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person and entity listed. In order to
further reduce filing burdens and
improve the quality of the ownership
data, the Commission incorporated
these changes into biennial and nonbiennial versions of Form 323 and Form
323–E.
113. In the Report and Order, the
Commission adopted commenters’
proposal to allow parties to identify
themselves as Tribal entities on Form
323–E in order to inform the
Commission’s ongoing efforts to expand
broadcast opportunities for Tribal
entities. Because these efforts involve
both commercial and noncommercial
broadcasting, and in light of the
Commission’s ongoing efforts to
improve its broadcast ownership data
collections, the Commission found that
the rationale for adding a Tribal Entity
designation to Form 323–E applied
equally to Form 323. The Commission
found that the collection of this
information on a biennial basis will be
minimally burdensome, and any
increased burden is outweighed by the
significant burden-reducing measures
adopted in the Report and Order.
Accordingly, the Commission modified
section II–B, question 2(a), of Form 323
and the parallel question in the revised
version of Form 323–E to allow (but not
require) filers to indicate whether or not
licensees and/or reported attributable
entities are Tribal Nations or Tribal
entities.
114. The Commission also opted to
include in section I, question 8, of Form
323 the designation for limited liability
companies. Currently, the question
requires a filer to identify the nature of
the respondent, and currently allows the
filer to choose between the designations
of sole proprietorship, for-profit
corporation, not-for-profit corporation,
general partnership, and limited
partnership. Respondents that do not fit
into one of these categories must select
‘‘other’’ and provide an explanatory
exhibit. The Commission found that
adding the limited liability company
designation to this question will reduce
burdens on limited liability company
filers by eliminating the need to provide
an exhibit.
115. The Commission also reduced
burdens and improved the quality and
usability of the ownership data by
clarifying the manner in which filers
should report contracts and other
instruments that must be filed with the
Commission, as described in 47 CFR
73.3613. Currently, Form 323 and Form
323–E require stations to list all
contracts required to be filed with the
Commission pursuant to § 73.3613. The
respondent on any given report may or
may not be a party to these contracts
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and instruments. Some filers list all
relevant documents on the licensee’s
ownership report, while other filers opt
to list different documents on different
reports. The latter approach requires
filers to include different, often
overlapping, lists of documents on
multiple reports and forces researchers
and other parties to examine all of a
station’s ownership filings to construct
a complete list of that station’s required
contracts and instruments. To address
these issues, the Commission modified
the relevant questions on Form 323 and
Form 323–E to require all § 73.3613
documents for a station to be listed on
the report for that station’s licensee. The
Commission determined that
clarification will reduce filing burdens,
because filers will be able to enter all
required information on the licensee
report and simply check ‘‘N/A’’ for all
parent filings.
116. The Commission also reduced
burdens by eliminating question 2 of
section II–A and section II–B of Form
323, which requires filers to provide
capitalization information for any
respondent that is a licensee, permittee,
or entity that has a majority interest in,
or otherwise exercises de facto control
over the licensee. Eliminating this
question will reduce filing burdens
without meaningfully compromising
data quality because question 3(a) better
addresses the Commission’s need to
ascertain equity ownership of, and
voting rights in, the respondent than
does question 2(a).
117. To improve the quality of the
broadcast ownership data collections,
the Commission added a ‘‘yes/no’’
question to each subform of Form 323,
section II–A, question 3(a) (nonbiennial), and section II–B, question 3(a)
(biennial), to allow parties to identify
jointly held voting interests. In certain
circumstances, two or more parties hold
a voting interest in a licensee or other
respondent jointly. Two parties may, for
example, hold 100 percent of the voting
interest in an entity together, as joint
tenants (as opposed to each individual
holding 50 percent of the voting
interests). Similarly, agreements for
partnerships or limited liability
companies may provide that two or
more individuals exercise voting power
together, such that any of the relevant
parties can fully exercise the voting
interest. Because the current version of
Form 323 provides no mechanism for
parties to identify situations in which
voting interests are jointly held, it is
likely that filers report such interests in
different ways, which leads to errors
and inconsistencies in the
Commission’s data. In reviewing
submitted data, the Commission found
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that the inability to identify and
interpret jointly held voting interests on
ownership reports rendered it
impossible for Commission staff to
electronically or manually process those
reports. Parties reviewing non-biennial
Form 323 filings will face similar
difficulties. Accordingly, the
Commission finds that adding a
question to Form 323 to address this
issue is a minimally burdensome way to
improve the quality of the Commission’s
ownership data. Because the
Commission did not believe that there
are many jointly held voting interests in
the NCE context, the Commission did
not make a similar modification to Form
323–E at this time.
118. The Commission also modifies
Form 323 section II–A, question 3(a)
(non-biennial) and section II–B,
question 3(a) (biennial) to add a new
positional interest category that will
allow filers to identify reported parties
that are attributable by virtue of a joint
sales agreement (JSA) or local marketing
agreement (LMA). This change is
designed to increase the usability of the
Commission’s ownership data and
reflects the Commission’s recent
decision concerning attribution of
television JSAs.
119. The Report and Order also
addressed some proposals submitted by
commenters that it has declined to
implement at this time. The
Commission declined to adopt a
proposal to extend reporting
requirements to parties that operate a
station pursuant to a nonattributable
LMA. The Commission declined to
extend the reporting requirement to
nonattributable operating agreements
because it was not convinced that the
current record reflects that a data
collection focused on this category of
nonattributable interest holders would
meaningfully improve the data set. The
Commission also declined to adopt a
proposal to create a separate filing
category for transfers to bankruptcy
trustees, debtors-in-possession, or trusts,
because the record did not demonstrate
the utility of the information,
particularly in light of the fact that the
Commission’s online application
database and/or Web site already
provide information concerning
individual transactions. The Public
Access portion of CDBS allows users to
search for assignment applications
based on multiple criteria, including
call sign, Facility ID Number, service,
station location (city and state),
application file number, and
applications status. This electronic
system also gives users access to the full
content of assignment and transfer
applications and provides information
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concerning legal actions pertaining to
those applications.
120. Several commenters asked the
Commission to modify its electronic
filing system, the Public Access portion
of CDBS, or the online instructions for
CDBS. For example, parties asked the
Commission to create new filing
systems for parties with limited
broadband access and/or to update
CDBS accounts to recognize the type of
entity, list only reports applicable to
that entity, indicate previous filings and
dates, allow users to pre-populate
entries in new reports based on prior
reports (including forms of different
types), and provide automated filing
reminders. Several of these capabilities
already exist in CDBS. For example, if
a party uses the same CDBS account for
all of its filings, that account already
contains the station’s prior filings as
well as information about those filings,
including submission dates. CDBS in
many cases allows users to pre-populate
new ownership reports by copying or
prefilling data from another filing of the
same type. To utilize these and other
burden-reducing capabilities in CDBS,
filers sometimes use different CDBS
accounts for different types of filings
and different entities. The Commission
did not want filers to lose the ability to
benefit from the ability to use the same
CDBS account for all of its filings. The
remaining suggestions were either
technically infeasible or would impose
significant costs on the Commission that
appear to exceed any possible benefits
at this time. Other commenters
suggested various enhancements to
search capabilities within the Public
Access portion of CDBS, including
searching ownership reports by gender,
race, ethnicity, voting percentage, and
equity percentage; displaying
explanatory messages when searches
produce no results; and alerting
searchers about assignment and/or
transfer applications. Researchers and
other parties currently can download
the data files from the Commission’s
Web site at any time and study, search,
and manipulate the data in a wide
variety of ways. This limits the need for
the Commission to develop an extensive
catalog of complex query options within
the Public Access portion of CDBS. The
Commission found that the costs of
implementing these suggested
modifications to CDBS at this time
exceed the benefits.
121. Several commenters asked that
the Commission not audit ownership
data submitted by NCE stations and/or
that NCE entities be subjected to
reduced compliance standards and/or
forfeitures. The Commission found that
in order to maintain and improve the
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quality of both the commercial and
noncommercial ownership data, the
Commission must have the ability to
audit broadcast ownership data and
hold parties responsible for their
submissions. Accordingly, the
Commission declined to make any
changes to its approach to ownership
report data audits and related
forfeitures.
3. Description and Estimate of the
Number of Small Entities to Which the
Proposed Rules Would Apply
122. The RFA directs agencies to
provide a description of, and, where
feasible, an estimate of the number of
small entities that may be affected by
the proposed rules, if adopted. The RFA
defines the term ‘‘small entity’’ as
having the same meaning as the terms
‘‘small business,’’ ‘‘small organization,’’
and ‘‘small governmental jurisdiction’’
under section 3 of the Small Business
Act. 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 which: (1) is
independently owned and operated; (2)
is not dominant in its field of operation;
and (3) satisfies any additional criteria
established by the Small Business
Administration (SBA). The actions
taken herein affect small television and
radio broadcast stations. A description
of these small entities, as well as an
estimate of the number of such small
entities, is provided below.
123. Television Broadcasting. The
SBA defines a television broadcasting
station that has no more than $38.5
million in annual receipts as a small
business. The definition of business
concerns included in this industry
states that establishments are primarily
engaged in broadcasting images together
with sound. These firms operate
television broadcasting studios and
facilities for the programming and
transmission of programs to the public.
These firms also produce or transmit
visual programming to affiliated
broadcast television stations, which in
turn broadcast the programs to the
public on a predetermined schedule.
Programming may originate in their own
studio, from an affiliated network, or
from external sources. Census data for
2007 indicate that 808 such firms were
in operation for the duration of that
entire year. Of these, 709 had annual
receipts of less than $25.0 million per
year and 99 had annual receipts of $25.0
million or more per year. Based on this
data and the associated size standard,
the Commission concludes that the
majority of such firms are small.
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124. Additionally, the Commission
has estimated the number of licensed
commercial television stations to be
1,391. According to Commission staff
review of BIA/Kelsey, LLC’s Media
Access Pro Television Database on July
22, 2015, about 1,268 of an estimated
1,391 commercial television stations (or
approximately 91 percent) had revenues
of $38.5 million or less. The
Commission has estimated the number
of licensed noncommercial educational
television stations to be 394. We do not
have revenue data or revenue estimates
for noncommercial stations. These
stations rely primarily on grants and
contributions for their operations, so we
will assume that all of these entities
qualify as small businesses. We note
that in assessing whether a business
entity 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 any changes to the filing
requirements for FCC Form 323 or Form
323–E, because the revenue figures on
which this estimate is based do not
include or aggregate revenues from
affiliated companies.
125. An element of the definition of
‘‘small business’’ is that the entity not
be dominant in its field of operation.
The Commission is unable at this time
and in this context to define or quantify
the criteria that would establish whether
a specific television station is dominant
in its market of operation. Accordingly,
the foregoing estimate of small
businesses to which the rules may apply
does not exclude any television stations
from the definition of a small business
on this basis and is therefore overinclusive to that extent. An additional
element of the definition of ‘‘small
business’’ is that the entity must be
independently owned and operated. 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.
126. Radio Broadcasting. The SBA
defines a radio broadcasting entity that
has $38.5 million or less in annual
receipts as a small business. Business
concerns included in this industry are
those ‘‘primarily engaged in
broadcasting aural programs by radio to
the public.’’ Census data for 2007
indicate that 2,926 such firms were in
operation for the duration of that entire
year. Of these, 2,877 had annual receipts
of less than $25.0 million per year and
49 had annual receipts of $25.0 million
or more per year. Based on this data and
the associated size standard, the
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Commission concludes that the majority
of such firms are small.
127. Further, according to
Commission staff review of BIA/Kelsey,
LLC’s Media Access Pro Radio Database
on July 22, 2015, about 11,354 (or about
99.9 percent) of 11,364 commercial
radio stations in the United States have
revenues of $38.5 million or less. The
Commission has estimated the number
of licensed noncommercial radio
stations to be 4,091. We do not have
revenue data or revenue estimates for
these stations. These stations rely
primarily on grants and contributions
for their operations, so we will assume
that all of these entities qualify as small
businesses. We note that in assessing
whether a business entity 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 any changes to
filing requirements for FCC Form 323 or
Form 323–E, because the revenue
figures on which this estimate is based
do not include or aggregate revenues
from affiliated companies.
128. In this context, the application of
the statutory definition to radio stations
is of concern. 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
and in this context to define or quantify
the criteria that would establish whether
a specific radio station is dominant in
its field of operation. Accordingly, the
foregoing estimate of small businesses to
which the rules may apply does not
exclude any radio station from the
definition of a small business on this
basis and is therefore over-inclusive to
that extent. 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.
129. Class A TV and LPTV Stations.
The rules and policies adopted herein
apply to licensees of low power
television (LPTV) stations, including
Class A TV stations and, as well as to
potential licensees in these television
services. The same SBA definition that
applies to television broadcast licensees
would apply to these stations. The SBA
defines a television broadcast station as
a small business if such station has no
more than $38.5 million in annual
receipts. As of June 30, 2015, there are
approximately 422 licensed Class A
stations and 1,920 licensed LPTV
stations. Given the nature of these
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services, we will presume that all of
these licensees qualify as small entities
under the SBA definition. We note,
however, that under the SBA’s
definition, revenue of affiliates that are
not LPTV stations should be aggregated
with the LPTV station revenues in
determining whether a concern is small.
Our estimate may thus overstate the
number of small entities since the
revenue figure on which it is based does
not include or aggregate revenues from
non-LPTV affiliated companies.
4. Description of Projected Reporting,
Recordkeeping and Other Compliance
Requirements
130. The Report and Order requires
all individuals reported on Form 323
and Form 323–E to obtain and provide
a CORES FRN or an RUFRN. However,
the SUFRN remains available in limited
circumstances, but individuals for
whom an SUFRN is reported may be
subject to enforcement action.
Currently, the Commission requires all
attributable interest holders of
commercial broadcast stations to be
reported on Form 323. The Report and
Order also now requires filers of Form
323–E to provide the race, gender, and
ethnicity of individuals reported on
Form 323–E. The Report and Order
states that both Form 323 and Form
323–E are due no later than December
1, 2017, and every two years thereafter.
The Ownership Reports must reflect
information current as of October 1 of
the filing year.
5. Steps Taken To Minimize Significant
Impact on Small Entities, and
Significant Alternatives Considered
131. The RFA requires an agency to
describe any significant alternatives that
is has considered in reaching its
proposed approach, 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 and 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.
132. The Report and Order explains
that the RUFRN is designed to be an
alternative to requiring submission of an
individual’s full SSN to CORES in order
to generate a CORES FRN for purposes
of being reported on the biennial
ownership reports. The Commission
found that an FRN generated through
CORES is far superior for purposes of
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tracking individual owners and that the
decision to allow individual attributable
interest holders the option of obtaining
and using an RUFRN in lieu of a TIN/
SSN backed CORES FRN will impose
minimal costs and burdens, if any, on
individuals or filers. However, the
Commission decided to maintain the
availability of the SUFRN in limited
circumstances so that filers, including
small entities, may timely submit a
Form 323 or Form 323–E even if the
filer was unable to obtain a CORES FRN
or RUFRN for a reported individual. The
individual for whom an SUFRN is
reported may be subject to enforcement
action for failure to obtain and provide
a CORES FRN or RUFRN, pursuant to
Commission policy and its rules.
133. The Commission has extended
the filing deadline for Form 323 to
permit all filers, including small
businesses, an additional 30 days to file
the ownership report. The Commission
also set the filing deadlines for Form
323–E to coincide with the deadlines for
Form 323. The Commission considered
a proposal to set the uniform filing
deadline for Form 323–E to the first
quarter to coincide with the date that
certain NCE stations submit similar data
to CPB. The Commission found that this
suggestion would not allow it to obtain
the synchronized data needed to
evaluate minority and female
participation in broadcasting over all
the services over time. Moreover,
because not all NCE stations submit data
to CPB, efforts by the Commission to
coordinate with CPB would not fully
address the filing deadline issue.
134. The Report and Order adopted
changes to Forms 323 and 323–E to
reduce the filing burden on all filers,
including small entities. The
Commission alleviated the filing burden
by modifying Form 323 to allow a
parent entity with multiple licensee
subsidiaries to file one report that
covers all of those licensees. This
modification will also be reflected on
the revised Form 323–E. The
Commission also deleted the broadcast
interests portion of section II–B,
question 3(c), and instead will add
simple yes/no radio buttons to the
subforms of that question that require
filers to indicate whether each reported
entity or individual has other
attributable broadcast interests. In order
to further reduce filing burdens and
improve the quality of its ownership
data, the Commission incorporated this
change into biennial and non-biennial
versions of Form 323 and Form 323–E.
The Commission also modified the
relevant questions on Form 323 and
Form 323–E to require all section
73.3613 documents for a station to be
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listed on the report for that station’s
licensee. This clarification will reduce
filing burdens, because filers will be
able to enter all required information on
the licensee report and simply check
‘‘N/A’’ for all parent filings. The
Commission also reduced burdens by
eliminating on Form 323, question 2 of
section II–A and section II–B, which
requires filers to provide capitalization
information for any respondent that is a
licensee, permittee or entity that has a
majority interest in, or otherwise
exercises de facto control over the
licensee. Form 323 will now include a
limited liability company designation in
section 1, question 8, which will reduce
the filing burden on limited liability
company filers by eliminating the need
to provide an explanatory exhibit.
6. Report to Congress
135. Commission will send a copy of
the Report and Order, including this
FRFA, in a report to Congress and the
Government Accountability Office,
pursuant to the Congressional Review
Act. In addition, the Commission will
send a copy of the Report and Order,
including this FRFA, to the Chief
Counsel for Advocacy of the Small
Business Administration. A copy of this
Report and Order and FRFA (or
summaries thereof) will also be
published in the Federal Register.
B. Congressional Review Act
136. The Commission will send a
copy of this Report and Order in a
report to be sent to Congress and the
Government Accountability Office
pursuant to the Congressional Review
Act, see 5 U.S.C. 801(a)(1)(A).
V. Ordering Clauses
137. Accordingly it is ordered that,
pursuant to the authority contained in
sections 1, 2(a), 4(i), 257, 303(r), 307,
309, and 310 of the Communications
Act of 1934, as amended, 47 U.S.C. 151,
152(a), 154(i), 257, 303(r), 307, 309, and
310, this Report and Order is adopted.
138. It is further ordered that the
Koerner & Olender Petition for
Reconsideration and the Fletcher Heald
Petition for Reconsideration are granted
to the extent the relief requested is
consistent with this Report and Order
and are otherwise denied.
139. It is further ordered that the rule
amendments attached hereto as
Appendix B and the revised filing
procedures and changes to FCC Form
323 and FCC Form 323–E adopted in
this Report and Order will become
effective upon publication of a notice in
the Federal Register announcing
approval by the Office of Management
and Budget.
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140. It is further ordered that the
Media Bureau is hereby delegated
authority to make all necessary changes
to Form 323, Form 323–E, and the
Commission’s electronic database
system to implement the changes
adopted in this Report and Order.
141. It is further ordered that the
Commission’s Consumer and
Governmental Affairs Bureau, Reference
Information Center, shall send a copy of
this Report and Order, including the
Final Regulatory Flexibility Analysis, to
the Chief Counsel for Advocacy of the
Small Business Administration.
142. It is further ordered that the
Commission SHALL SEND a copy of
this Report and Order in a report to be
sent to Congress and the Government
Accountability Office pursuant to the
Congressional Review Act, see 5 U.S.C.
801(a)(1)(A).
List of Subjects
47 CFR Part 73
Radio broadcast services.
47 CFR Part 74
Experimental radio, Auxiliary,
Special broadcast and other program
distributional services.
Federal Communications Commission.
Gloria J. Miles,
Federal Register Liaison Officer, Office of the
Secretary.
Final Rules
For the reasons discussed in the
preamble, the Federal Communications
Commission amends 47 CFR parts 73
and 74 as follows:
PART 73—RADIO BROADCAST
SERVICES
1. The authority citation for part 73
continues to read as follows:
■
Authority: 47 U.S.C. 154, 303, 334, 336
and 339.
2. Section 73.3615 is amended by
revising paragraphs (a) through (f) to
read as follows:
■
§ 73.3615
Ownership reports.
(a) The Ownership Report for
Commercial Broadcast Stations (FCC
Form 2100, Schedule 323) must be filed
electronically every two years by each
licensee of a commercial AM, FM, or TV
broadcast station and any entity that
holds an interest in the licensee that is
attributable pursuant to § 73.3555 (each
a ‘‘Respondent’’). The ownership report
shall be filed by December 1 in all oddnumbered years. Each ownership report
shall provide all information required
by, and comply with all requirements
set forth in, the version of FCC Form
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2100, Schedule 323 (including all
instructions for the form and schedule)
that is current on October 1 of the year
in which the ownership report is filed.
The information provided on each
ownership report shall be current as of
October 1 of the year in which the
ownership report is filed. A Respondent
with a current and unamended biennial
ownership report (i.e., an ownership
report that was filed pursuant to this
subsection) on file with the Commission
that is still accurate and which was filed
using the version of FCC Form 2100,
Schedule 323 that is current on October
1 of the year in which its biennial
ownership report is due may
electronically validate and resubmit its
previously filed biennial ownership
report.
(b)(1) Each permittee of a commercial
AM, FM or TV broadcast station and
any entity that holds an interest in the
permittee that is attributable pursuant to
§ 73.3555 (each a ‘‘Respondent’’) shall
file an ownership report on FCC Form
2100, Schedule 323 within 30 days of
the date of grant by the FCC of an
application by the permittee for original
construction permit. Each ownership
report shall provide all information
required by, and comply with all
requirements set forth in, the version of
FCC Form 2100, Schedule 323
(including all instructions for the form
and schedule) that is current on the date
on which the ownership report is filed.
(2) Except as specifically noted below,
each permittee of a commercial AM, FM
or TV broadcast station and any entity
that holds an interest in the permittee
that is attributable pursuant to § 73.3555
(each a ‘‘Respondent’’) shall file an
ownership report on FCC Form 2100,
Schedule 323 on the date that the
permittee applies for a station license.
Each ownership report shall provide all
information required by, and comply
with all requirements set forth in, the
version of FCC Form 2100, Schedule
323 (including all instructions for the
form and schedule) that is current on
the date on which the ownership report
is filed. If a Respondent has a current
and unamended ownership report on
file with the Commission that was filed
pursuant to paragraphs (b)(1) or (c) of
this section, was submitted using the
version of FCC Form 2100, Schedule
323 that is current on the date on which
the ownership report due pursuant to
paragraph (b)(2) is filed, and is still
accurate, the Respondent may certify
that it has reviewed such ownership
report and that it is accurate, in lieu of
filing a new ownership report.
(c) Each permittee or licensee of a
commercial AM, FM or TV broadcast
station and any entity that holds an
VerDate Sep<11>2014
20:58 Apr 01, 2016
Jkt 238001
interest in the permittee or licensee that
is attributable pursuant to § 73.3555
(each a ‘‘Respondent’’), shall file an
ownership report on FCC Form 2100,
Schedule 323 within 30 days of
consummating authorized assignments
or transfers of permits and licenses.
Each ownership report shall provide all
information required by, and comply
with all requirements set forth in, the
version of FCC Form 2100, Schedule
323 (including all instructions for the
form and schedule) that is current on
the date on which the ownership report
is filed.
(d) The Ownership Report for
Noncommercial Broadcast Stations (FCC
Form 2100, Schedule 323–E) must be
filed electronically every two years by
each licensee of a noncommercial
educational AM, FM or TV broadcast
station and any entity that holds an
interest in the licensee that is
attributable pursuant to § 73.3555 (each
a ‘‘Respondent’’). The ownership report
shall be filed by December 1 in all oddnumbered years. Each ownership report
shall provide all information required
by, and comply with all requirements
set forth in, the version of FCC Form
2100, Schedule 323–E (including all
instructions for the form and schedule)
that is current on October 1 of the year
in which the ownership report is filed.
The information provided on each
ownership report shall be current as of
October 1 of the year in which the
ownership report is filed. A Respondent
with a current and unamended biennial
ownership report (i.e., an ownership
report that was filed pursuant to this
subsection) on file with the Commission
that is still accurate and which was filed
using the version of FCC Form 2100,
Schedule 323–E that is current on
October 1 of the year in which its
biennial ownership report is due may
electronically validate and resubmit its
previously filed biennial ownership
report.
(e)(1) Each permittee of a
noncommercial educational AM, FM or
TV broadcast station and any entity that
holds an interest in the permittee that is
attributable pursuant to § 73.3555 (each
a ‘‘Respondent’’) shall file an ownership
report on FCC Form 2100, Schedule
323–E within 30 days of the date of
grant by the FCC of an application by
the permittee for original construction
permit. Each ownership report shall
provide all information required by, and
comply with all requirements set forth
in, the version of FCC Form 2100,
Schedule 323–E (including all
instructions for the form and schedule)
that is current on the date on which the
ownership report is filed.
PO 00000
Frm 00030
Fmt 4701
Sfmt 4700
(2) Except as specifically noted below,
each permittee of a noncommercial
educational AM, FM or TV broadcast
station and any entity that holds an
interest in the permittee that is
attributable pursuant to § 73.3555 (each
a ‘‘Respondent’’) shall file an ownership
report on FCC Form 2100, Schedule
323–E on the date that the permittee
applies for a station license. Each
ownership report shall provide all
information required by, and comply
with all requirements set forth in, the
version of FCC Form 2100, Schedule
323–E (including all instructions for the
form and schedule) that is current on
the date on which the ownership report
is filed. If a Respondent has a current
and unamended ownership report on
file with the Commission that was filed
pursuant to paragraphs (e)(1) or (f) of
this section, was submitted using the
version of FCC Form 2100, Schedule
323–E that is current on the date on
which the ownership report due
pursuant to this subsection is filed, and
is still accurate, the Respondent may
certify that it has reviewed such
ownership report and that it is accurate,
in lieu of filing a new ownership report.
(f) Each permittee or licensee of a
noncommercial educational AM, FM or
TV broadcast station, and any entity that
holds an interest in the permittee or
licensee that is attributable pursuant to
§ 73.3555 (each a ‘‘Respondent’’), shall
file an ownership report on FCC Form
2100, Schedule 323–E within 30 days of
consummating authorized assignments
or transfers of permits and licenses.
Each ownership report shall provide all
information required by, and comply
with all requirements set forth in, the
version of FCC Form 2100, Schedule
323–E (including all instructions for the
form and schedule) that is current on
the date on which the ownership report
is filed.
*
*
*
*
*
PART 74—EXPERIMENTAL RADIO,
AUXILIARY, SPECIAL BROADCAST
AND OTHER PROGRAM
DISTRIBUTIONAL SERVICES
3. The authority citation for part 74
continues to read as follows:
■
Authority: 47 U.S.C. 154, 302a, 303, 307,
309, 336 and 554.
4. Section 74.797 is revised to read as
follows:
■
§ 74.797
Biennial Ownership Reports.
The Ownership Report for
Commercial Broadcast Stations (FCC
Form 2100, Schedule 323) must be
electronically filed by December 1 in all
odd-numbered years by each licensee of
E:\FR\FM\04APR3.SGM
04APR3
Federal Register / Vol. 81, No. 64 / Monday, April 4, 2016 / Rules and Regulations
mstockstill on DSK4VPTVN1PROD with RULES3
a low power television station or other
Respondent (as defined in § 73.3615(a)
of this chapter). A licensee or other
Respondent with a current and
unamended biennial ownership report
(i.e., a report that was filed pursuant to
this subsection) on file with the
Commission that is still accurate and
VerDate Sep<11>2014
20:58 Apr 01, 2016
Jkt 238001
which was filed using the version of
FCC Form 2100, Schedule 323 that is
current on October 1 of the year in
which its biennial ownership report is
due may electronically validate and
resubmit its previously filed biennial
ownership report. The information
provided on each ownership report
PO 00000
Frm 00031
Fmt 4701
Sfmt 9990
19461
shall be current as of October 1 of the
year in which the ownership report is
filed. For information on filing
requirements, filers should refer to
§ 73.3615(a) of this chapter.
[FR Doc. 2016–04838 Filed 4–1–16; 8:45 am]
BILLING CODE 6712–01–P
E:\FR\FM\04APR3.SGM
04APR3
Agencies
[Federal Register Volume 81, Number 64 (Monday, April 4, 2016)]
[Rules and Regulations]
[Pages 19431-19461]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-04838]
[[Page 19431]]
Vol. 81
Monday,
No. 64
April 4, 2016
Part V
Federal Communications Commission
-----------------------------------------------------------------------
47 CFR Parts 73 and 74
Promoting Diversification of Ownership in the Broadcasting Services;
Final Rule
Federal Register / Vol. 81 , No. 64 / Monday, April 4, 2016 / Rules
and Regulations
[[Page 19432]]
-----------------------------------------------------------------------
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 73 and 74
[MB Docket Nos. 07-294, 10-103, MD Docket No. 10-234; FCC 16-1]
Promoting Diversification of Ownership in the Broadcasting
Services
AGENCY: Federal Communications Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: In this document, the Commission refines the collection of
data reported on FCC Form 323, Ownership Report for Commercial
Broadcast Stations, and FCC Form 323-E, Ownership Report for
Noncommercial Broadcast Stations. Specifically, the Commission
implements a Restricted Use FRN (RUFRN) within the Commission's
Registration System (CORES) that individuals may use solely for the
purpose of broadcast ownership report filings; eliminates the
availability of the Special Use FRN (SUFRN) for broadcast station
ownership reports, except in very limited circumstances; prescribes
revisions to Form 323-E that conform reporting for noncommercial
educational (NCE) broadcast stations more closely to those for
commercial stations; and makes a number of significant changes to its
reporting requirements that reduce the filing burdens on broadcasters,
streamline the process, and improve data quality. These enhancements
will enable the Commission to obtain data reflecting a more useful,
accurate, and thorough assessment of minority and female broadcast
station ownership in the United States while reducing certain filing
burdens.
DATES: Effective May 4, 2016 The amendments to Sec. Sec. 73.3615 and
74.797 contain new or revised information collection requirements that
are not effective until approved by the Office of Management and Budget
(OMB). The Commission will publish a document in the Federal Register
announcing the effective date of these changes. A separate notice will
be published in the Federal Register soliciting public and agency
comments on the information collections and establishing a deadline for
accepting such comments.
FOR FURTHER INFORMATION CONTACT: Jake Riehm, Industry Analysis
Division, Media Bureau, FCC, (202) 418-2330. For additional information
concerning the information collection requirements contained in the
Report and Order, contact Cathy Williams at (202) 418-2918, or via the
Internet at PRA@fcc.gov.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report
and Order, Second Report and Order, and Order on Reconsideration
(Second Report and Order) in MB Docket Nos. 07-294, 10-103, and MD
Docket Nos. 10-234; FCC 16-1, adopted January 8, 2016, and released
January 20, 2016. The complete text of this document is available
electronically in ASCII, Microsoft Word, and PDF formats via the search
function on the FCC's Electronic Document Management System (EDOCS) Web
page at https://apps.fcc.gov/edocs_public/. The document is also
available electronically via the FCC's Electronic Comment Filing System
(ECFS) Web page at https://apps.fcc.gov/ecfs/. In addition, the complete
document is available for inspection and copying during regular
business hours in the FCC Reference Information Center, 445 12th Street
SW., Room CY-A257, Washington, DC 20554. To request materials in
accessible formats for people with disabilities (Braille, large print,
electronic files, audio format), 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).
Final Paperwork Reduction Act of 1995 Analysis
This document contains information collection requirements subject
to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. The
requirements will be submitted to the Office of Management and Budget
(OMB) for review under section 3507(d) of the PRA. OMB, the general
public, and other Federal agencies will be invited to comment on the
information collection requirements contained in this proceeding. The
Commission will publish a separate document in the Federal Register at
a later date seeking these comments. In addition, the Commission notes
that pursuant to the Small Business Paperwork Relief Act of 2002,
Public Law 107-198, see 44 U.S.C. 3506(c)(4), the Commission seeks
specific comment on how it might ``further reduce the information
collection burden for small business concerns with fewer than 25
employees.''
Synopsis
I. Introduction
1. The Commission has a long-standing goal of promoting diversity
in ownership of broadcast stations to ensure that diverse viewpoints
and perspectives are available to the American people in the content
they receive over the broadcast airwaves. In pursuit of this goal, the
Commission has a long history of promulgating rules and regulations
designed to foster diversity in terms of minority and female ownership
in particular. In this Report and Order, Second Report and Order, and
Order on Reconsideration (Report and Order), the Commission acts to
improve the data available to analyze issues relevant to ownership and
viewpoint diversity by refining the collection of data reported on FCC
Form 323, Ownership Report for Commercial Broadcast Stations, and FCC
Form 323-E, Ownership Report for Noncommercial Broadcast Stations.
2. A necessary precursor to the Commission's policy-making efforts
in this area is the collection of comprehensive, reliable data
reflecting the race, gender, and ethnicity of the owners and other
interest holders in broadcast stations. Such data are essential to
effectively study and analyze ownership trends, to assess the impact of
Commission rules, and to provide a foundation for the adoption of new
rules, among other things. To be useful for this purpose, to the
greatest extent possible the data must be capable of being read,
verified, searched, aggregated, and cross-referenced electronically.
Moreover, for the Commission's broadcast ownership data to be complete,
reliable, and usable for study and analysis, individuals reported on
Forms 323 and 323-E must be uniquely identified. The enhancements
described herein enable the Commission to obtain data reflecting a more
useful, accurate, and thorough assessment of minority and female
broadcast station ownership in the United States while reducing certain
filing burdens. These improvements also address the directive from the
U.S. Court of Appeals for the Third Circuit that the Commission obtain
more and better data concerning broadcast ownership to support its
rulemaking decisions.\1\ Ultimately, the Commission believes that these
actions will assist its future initiatives to promote diverse
ownership.
---------------------------------------------------------------------------
\1\ See Prometheus Radio Project v. FCC, 652 F.3d 431, 469, 471-
72 (3d. Cir. 2011) (Prometheus II).
---------------------------------------------------------------------------
3. Accordingly, pursuant to the Commission's statutory mandate
contained in section 257 of the Telecommunications Act of 1996 (the
1996 Act) and section 309(j) of the Communications Act of 1934 (the
Act) to promote opportunities for small businesses and women and
minorities in the broadcasting industry, the Commission implements a
Restricted
[[Page 19433]]
Use FRN (RUFRN) within the Commission's Registration System (CORES)
that individuals may use solely for the purpose of broadcast ownership
report filings. The Commission believes that the RUFRN will allow for
sufficient unique identification of individuals listed on broadcast
ownership reports without necessitating the disclosure to the
Commission of individuals' full Social Security Numbers (SSNs). In
light of the Commission's adoption of the RUFRN requirement, the
Commission eliminates the availability of the Special Use FRN (SUFRN)
for broadcast station ownership reports, except in very limited
circumstances as further described herein. The Commission also
prescribes revisions to Form 323-E that conform reporting for
noncommercial educational (NCE) broadcast stations more closely to
those for commercial stations, including information about race,
gender, and ethnicity of existing, reportable attributable interest
holders; the use of a unique identifier; and the biennial filing
requirement. Finally, the Commission makes a number of significant
changes to its reporting requirements that reduce the filing burdens on
broadcasters, streamline the process, and improve data quality. These
changes include extending the biennial filing deadline, reducing the
number of filings required, improving the reporting of other broadcast
and newspaper interests, and other modifications.
II. Background
4. The Commission has been engaged in a sustained effort to improve
the quality, utility, and reliability of its broadcast ownership data.
In 2009, the Commission substantially revised the biennial Form 323 to
facilitate longitudinal comparative studies of broadcast station
ownership. The changes also addressed flaws in the data collection
process identified by the United States Government Accountability
Office (GAO) and by researchers who had attempted to use the data
submitted on previous versions of Form 323. GAO cited several
shortcomings with the Commission's data collection process: (1)
Exemptions from the biennial filing requirement for certain types of
broadcast stations; (2) inadequate data quality procedures; and (3)
problems with storage and retrieval. GAO noted that ``more accurate,
complete, and reliable [broadcast ownership] data would allow FCC to
better assess the impact of its rules and regulations and allow the
Congress to make more informed legislative decisions,'' and it
``recommend[ed] that FCC take steps to improve the reliability and
accessibility of its data on the gender, race, and ethnicity of
broadcast outlet owners.'' \2\
---------------------------------------------------------------------------
\2\ U.S. Gov't Accountability Office, GAO-08-383, Media
Ownership: Economic Factors Influence the Number of Media Outlets in
Local Markets, While Ownership by Minorities and Women Appears
Limited and is Difficult to Assess, at 5 (2008).
---------------------------------------------------------------------------
5. To improve the quality of its broadcast ownership data, the
Commission adopted several significant changes to Form 323 in the 323
Order, 74 FR 25163, May 27, 2009, FCC 09-33, rel. May 5, 2009. First,
it set a uniform ``as of'' date of October 1 for the ownership data
being reported in the biennial filing and established a uniform filing
deadline of November 1, requiring all filers to report their ownership
interests as they exist on the ``as of'' date of the filing year and to
submit their reports no later than one month thereafter. These uniform
dates make it possible to discern statistically valid trends in
minority and female broadcast ownership over time, which was not
possible using the previous rolling filing deadlines, and to ensure the
timely collection of the data. The Commission expanded the requirement
to file Form 323 biennially to include sole proprietors and
partnerships of natural persons, as well as low power television (LPTV)
and Class A licensees.
6. In the 323 Order, the Commission also concluded that an FRN
should be reported for each interest holder reported on Form 323 and
directed staff to revise Form 323 accordingly. The Commission delegated
authority to staff to revisit the CORES FRN issue if additional changes
to the form were necessary. In order ``to further improve the ability
of researchers and other users of the data to cross-reference
information and construct ownership structures,'' the Media Bureau
revised Form 323 to require that an FRN be reported for every interest
holder reported on the form.\3\ The Bureau also revised the
instructions and questions in Form 323 to (1) clarify the information
sought in the form; (2) ensure that the data are collected in machine-
readable formats that can be imported into programs used to prepare
economic and policy studies; and (3) simplify completion of the form by
giving respondents menu or checkbox options to enter data. The Bureau
included built-in checks and pre-fill capabilities to assure greater
accuracy of the data reported and ease of completion of the form.
---------------------------------------------------------------------------
\3\ 323 Order, 74 FR at 25165.
---------------------------------------------------------------------------
7. Accompanying the 323 Order was a Fourth Diversity Further
Notice, 74 FR 25205, May 27, 2009, FCC 09-33, rel. May 5, 2009, in
which the Commission sought comments on changes to Form 323-E. The
Commission sought comment on whether to seek race, gender, and
ethnicity data from persons reported on Form 323-E in order to obtain
data that would further the Commission's goal to advance diversity in
the broadcast industry. Noting that many NCE broadcast station
licensees are non-profit, non-stock entities or governmental
organizations that are controlled by governing boards comprising
members without a financial stake in the broadcast station, the
Commission sought comment on how to define ownership in the
noncommercial context. Among other things, the Fourth Diversity Further
Notice sought comment on whether the Commission should adopt the same
or similar modifications for Form 323-E as it did for Form 323 in the
323 Order and whether the data quality measures adopted in the 323
Order would be appropriate and sufficient to ensure that the data
collected by Form 323-E are aggregable. The Fourth Diversity Further
Notice also sought comment on whether to require low power FM (LPFM)
stations to file a Form 323-E to collect ownership data on the
licensees or to continue to exempt LPFM licensees from the filing
requirements. The Commission will address issues in the Fourth
Diversity Further Notice related to LPFM in a future order. The Fourth
Diversity Further Notice was published in the Federal Register on May
27, 2009, with comments due on or before June 26, 2009, and reply
comments due on or before July 13, 2009.
8. On August 11, 2009, the Commission submitted a revised Form 323
to the Office of Management and Budget (OMB) for approval pursuant to
the Paperwork Reduction Act (PRA) requirements and published the
Federal Register notice initiating a 60-day comment period.\4\ Among
the changes submitted was a requirement that each filer provide a CORES
FRN for each reported attributable interest holder. Form 323 requires
Respondents to list each of the officers, directors, stockholders, non-
insulated partners, members and other persons or entities with a direct
attributable interest in the Respondent. Many comments submitted to OMB
objected to the revision requiring filers to report CORES FRNs for
individuals holding attributable interests, arguing that it required
them to provide SSNs to the Commission, which they claimed triggered
privacy, data security, and identity theft
[[Page 19434]]
concerns. Commenters also suggested that obtaining CORES FRNs for
reportable individuals would be burdensome, and that in some cases
filers might not be able to obtain the CORES FRN for all individual
attributable interest holders because individuals might be unwilling
either to obtain CORES FRNs for themselves or to provide their SSNs to
the filer for the purpose of obtaining CORES FRNs on their behalf. Two
Petitions for Writs of Mandamus were filed with the U.S. Court of
Appeals for the DC Circuit to stay the Commission's implementation of
the revisions to Form 323. The law firm of Fletcher, Heald & Hildreth,
P.L.C., on behalf of itself and various state broadcaster association
clients, filed the first Petition on December 23, 2009, Doc. No. 09-
1321, and the second Petition on May 28, 2010, Doc. No. 10-1117. Both
were denied.
---------------------------------------------------------------------------
\4\ Public Information Collection Requirement Submitted to OMB
for Review and Approval, Comments Requested, 74 FR 40,188 (Aug. 11,
2009).
---------------------------------------------------------------------------
9. On October 6, 2009, the Office of the Managing Director (OMD) at
the Commission submitted a letter to OMB addressing the comments filed
in response to the revised Form 323. OMD explained that requiring CORES
FRNs on Form 323 is an integral part of the Commission's effort to
improve the quality, reliability, and usability of the collected data
by eliminating inconsistencies and inadequacies in the data submitted.
The Reply Letter rejected allegations that the Commission failed to
comply with the notice requirements of the PRA or ran afoul of the
Privacy Act. OMD also disputed commenters' objections that the CORES
FRN requirement raised security and identity theft concerns. The
Commission utilizes a ``robust security architecture . . . for CORES
that exceeds Federal guidelines and recommendations'' and has deployed
operational controls that comply with National Institute of Standards
and Technology guidance.\5\ OMD stated that the Commission's servers
are securely located, that its databases are behind several firewalls,
and that all servers and communications are monitored. The Reply Letter
also noted that administrative access to the CORES application is
limited and that all transmission of non-public data is encrypted.
---------------------------------------------------------------------------
\5\ Letter from Walter Boswell, Acting Assoc. Managing Director,
PERM, OMD, FCC, to Nicholas A. Fraser, OMB, at 9 (Oct. 6, 2009).
---------------------------------------------------------------------------
10. The 323 Order also directed staff to modify Form 323 to require
those interest holders that would be attributable but for the single
majority shareholder exemption and the exemption for interests held in
eligible entities pursuant to the higher Equity/Debt Plus (EDP)
thresholds adopted in the Diversity Order to be reported on the form.
On October 15, 2009, the Commission addressed a petition for
reconsideration, in which the National Association of Broadcasters
(NAB) argued, inter alia, for reconsideration of elements of the 323
Order regarding the collection of information of certain
nonattributable interest holders on Form 323. In an opposition to NAB's
petition for reconsideration, the Office of the United Church of
Christ, Inc. (UCC), Benton Foundation, Common Cause, Media Alliance,
and National Organization of Women Foundation (collectively, UCC et
al.), supported the Commission's decision to collect ownership
information from certain nonattributable interest holders. NAB
disagreed on reply. Acknowledging that the Commission had not
explicitly expressed its intention to require certain nonattributable
interest holders to file information in its rulemaking notice, the
Commission deleted the reporting requirements for the nonattributable
interest holders and adopted the Fifth Diversity Further Notice, 78 FR
2934, Jan. 15, 2013, FCC 09-92, rel. Oct. 16, 2009. The Fifth Diversity
Further Notice, released on October 16, 2009, proposed to collect
ownership information from interest holders in a licensee that would be
attributable but for the single majority shareholder exemption and
those that would be attributable but for the higher EDP thresholds
adopted in the Diversity Order. In the Sixth Diversity Further Notice,
78 FR 2925, Jan. 15, 2013, FCC 12-166, rel. Jan 3, 2013, the Commission
sought comment, inter alia, on extending the CORES FRN requirement to
those nonattributable interests described in the Fifth Diversity
Further Notice in the event that the Commission requires that these
interests be reported on Form 323. The Commission will address issues
raised by and implicating proposals in the Fifth Diversity Further
Notice in a future order.
11. On October 19, 2009, OMB approved the revised Form 323, which
included the requirement that filers provide a CORES FRN for
individuals holding an attributable interest in the licensee. On
October 16, 2009, the Commission sent a subsequent letter to OMB
acknowledging the Commission's action in the 323 MO&O, 74 FR 56131,
Oct. 30, 2009, FCC 09-92, rel. Oct. 16, 2009, to eliminate the
reporting of certain nonattributable interest holders. After several
delayed filing deadlines, the Commission set July 8, 2010 as the first
biennial filing deadline using the revised Form 323. In response to
industry concerns about filers' ability to obtain CORES FRNs from all
individual interest holders due to individuals' concerns about privacy,
security, and identity theft, the Media Bureau allowed filers, as an
interim measure, to obtain an SUFRN for individuals (but not entities)
reported on the form in lieu of obtaining a CORES FRN. When clicking a
button on the electronic version of Form 323 to generate an SUFRN,
filers were advised via a pop-up box that ``[i]f, after using diligent
and good-faith efforts,'' a filer is unable to obtain an SSN from an
individual that must be reported on Form 323 in order to generate a
CORES FRN, the filer may elect to automatically generate in the
electronic Form 323 an SUFRN for that individual. The respondents were
also informed that those who use an SUFRN on Form 323 would be deemed
to be fully compliant with the filing obligations and the lack of a
CORES-based FRN would not subject a filer to enforcement action. SUFRNs
were available to filers for the 2009, 2011, and 2013 biennial filing
periods. Filers were directed that SUFRNs, like CORES-based FRNs, must
be used consistently.
12. In November 2009, Koerner & Olender, P.C., and Fletcher, Heald
& Hildreth, P.L.C., filed petitions seeking reconsideration of the
requirement to obtain CORES FRNs for individuals holding attributable
interests, arguing that the CORES FRN requirement is overly burdensome
and raises privacy and data security issues and that the Commission
provided inadequate notice of the CORES FRN requirement. In the Sixth
Diversity Further Notice, the Commission addressed petitioners'
concerns for adequate notice of the CORES FRN requirement for
individuals and sought comment on Koerner & Olender's request to
``redefine or reinterpret'' section 1.8002 of the Commission's rules.
This Report and Order resolves the remaining issues raised in these
petitions for reconsideration.
13. In June 2010, the Media Bureau initiated the Review of Media
Bureau Data Practices proceeding to examine the Bureau's data practices
to improve the way the Commission collects, uses and disseminates data.
The Bureau solicited input concerning potential improvements to all of
its existing data collections, including both the biennial and non-
biennial sections of Forms 323 and 323-E. The Bureau defined ``data
collection'' in ``the broadest manner possible, to include all
information collections approved by the Office of Management and Budget
under the Paperwork Reduction Act, including
[[Page 19435]]
data that the Commission formally requires to be submitted and all
information that must be retained by parties or disclosed to others.''
Forms 323 and 323-E were included in the inventory of data collections
linked in the item. Among other things, the Bureau asked whether its
various data collections should be continued or eliminated; whether the
Bureau should collect additional data and for what purpose(s); how the
Bureau's data collections could be improved; what burdens exist for the
Commission, industry, and the public; and what potential improvements
could be made concerning public access to, and Commission dissemination
of, submitted data. The Commission received numerous comments in this
proceeding, including two submissions--from NAB and the Minority Media
and Telecommunications Council (MMTC)--that addressed issues related to
the Commission's broadcast ownership report forms and data.
14. In December 2010, the Commission initiated another separate
rulemaking proceeding in which it proposed to update CORES to enhance
the Commission's data collection efforts and to improve customer
interface with CORES. In the CORES NPRM, 76 FR 5652, Feb. 1, 2011, FCC
10-192, rel. Dec. 7, 2010, the Commission stated that, ``[s]ince the
creation of CORES, entities have been able to obtain multiple FRNs in
order to permit different members of their corporate family to obtain
their own individual FRNs, regardless of whether those entities had
different taxpayer identification numbers (`TINs').'' For entities, the
TIN is generally their employer identification number (EIN), and for
individuals, the TIN is generally their SSN. The Commission stated that
it has had difficulty using CORES to identify all the FRNs an entity
holds when the entity has used inconsistent TINs or did not provide a
TIN to obtain an FRN through CORES. The Commission also observed that
some filers erroneously invoked exceptions to the requirement to
provide a TIN, making those entities or individuals difficult to track.
The Commission proposed several options to resolve these issues. In
addition, the Commission asked whether it should expand the
availability of SUFRNs for purposes other than the filing of Form 323.
15. In July 2011, the U.S. Court of Appeals for the Third Circuit,
as part of its review of the Commission's media ownership rules,
vacated and remanded certain aspects of the Diversity Order, 73 FR
28361, May 16, 2008, FCC 07-217, rel. Mar. 5, 2008. The Third Circuit
concluded that the Commission's decision to adopt a revenue-based
eligible entity definition to facilitate ownership diversity was
arbitrary and capricious because the Commission did not show how such a
definition specifically would assist minorities and women, who were
among the intended beneficiaries of the action. The court also remanded
each of the measures adopted in the Diversity Order that relied on the
eligible entity definition. The court found that the eligible entity
definition was not supported by ``data attempting to show a connection
between the definition chosen and the goal of the measures adopted--
increasing ownership of minorities and women,'' stressing that
regulations seeking to increase ownership by women and minorities must
be based on reliable data. The court stated that, ``[a]t a minimum, in
adopting or modifying its rules, the FCC must `examine the relevant
data and articulate a satisfactory explanation for its action[,]
including a rational connection between the facts found and the choice
made.''' The court also made plain that, ``[i]f the Commission requires
more and better data . . . it must get the data.'' The court stated
that the actions taken in the 323 Order and Fourth Diversity Further
Notice to reliably analyze minority and female ownership ``will,
however, lay necessary groundwork for the Commission's actions on
remand.''
16. On November 14, 2012, the Media Bureau released the first
electronic analysis of commercial broadcast ownership data submitted
pursuant to the revised biennial reporting requirements for 2009 and
2011 (2012 323 Report). A subsequent report, released by the Bureau on
June 27, 2014 (2014 323 Report), contained an analysis of the
commercial broadcast ownership data submitted during the 2013 filing
cycle. The data contained in the reports are ``snapshots'' of the
status of minority and female ownership in the broadcast industry and
are part of a planned series of biennial ``snapshots'' that can be used
for trend analysis. The reports contain 100 pages of summary schedules
and 30 spreadsheets of underlying data reflecting the Media Bureau's
analysis of the Form 323 data, which can be further studied and
manipulated by researchers and interested parties. Future, similar
reports are contemplated reflecting additional biennial reporting
periods. These reports provide detailed information by race, ethnicity,
and gender concerning ownership of commercial television, radio, Class
A television, and LPTV stations. For example, the 2012 323 Report
analyzed data for 1,348 full-power commercial television stations as of
October 1, 2011. Members of racial minorities held majority voting
interests in 30 stations, or 2.2 percent. Female owners held majority
voting interests in 91 stations, or 6.8 percent. The 2012 323 Report
also analyzed data for 5,611 commercial FM stations as of October 1,
2011. Members of racial minorities held majority voting interests in
196 stations, or 3.5 percent, and female owners held majority voting
interests in 323 stations, or 5.8 percent. Similarly, the 2012 323
Report analyzed data for 3,830 commercial AM stations as of October 1,
2011. Members of racial minorities held majority voting interests in
237 stations, or 6.2 percent, and female owners held majority voting
interests in 300 stations, or 7.8 percent. The 2014 323 Report analyzed
data for 1,386 full-power commercial television stations as of October
1, 2013. Members of racial minorities held majority voting interests in
41, or 3.0 percent, of those stations. Female owners held majority
voting interests in 87 stations, or 6.3 percent. The 2014 323 Report
also analyzed data for 5,714 commercial FM stations as of October 1,
2013. Members of racial minorities held majority voting interests in
169, or 3.0 percent, of these stations, and female owners held majority
voting interests in 383 stations, or 6.7 percent. The 2014 323 Report
also analyzed data for 3,737 commercial AM stations as of October 1,
2013. Members of racial minorities held majority voting interests in
225, or 6.0 percent, of these stations, and female owners held majority
voting interests in 310 stations, or 8.3 percent. In preparing these
reports, Commission staff observed difficulties with, and errors
within, the broadcast ownership data submitted to the Commission. Upon
review of the biennial ownership reports, Commission staff discovered
that many commercial broadcast stations submitted reports with
apparently inaccurate or insufficient data to permit electronic
calculation of voting interests. As a result, such biennial ownership
reports were not included in the Commission's analysis. Commission
staff worked with numerous broadcasters to correct errors contained in
their 2011 and 2013 biennial Form 323 filings via amendments, which
allowed stations covered by those reports to be properly categorized
for the 2012 and 2014 323 Reports. In addition, Commission staff
manually analyzed a large number of ownership reports, together with
other available information, in order to assign certain
[[Page 19436]]
stations to the appropriate categories manually for purposes of the
report. The 2012 323 Report stated that the problems with the data
stemmed, in part, from the ``complexity of the information required to
accurately file'' the revised version of Form 323.
17. The Commission also sought public comment on both reports. On
December 3, 2012, the Commission issued a Public Notice in the 2010
Quadrennial Regulatory Review proceeding offering parties the
opportunity to comment on the 2012 323 Report (2012 323 Report PN). The
2012 323 Report PN broadly sought ``additional comment on data
contained in [the 2012 323 Report],'' specifically referencing the
Commission's efforts ``to improve its collection and analysis of
broadcast ownership information'' and make ``improvements to the
reliability and utility of the data reported in FCC Form 323.'' Some
commenters responding to the 2012 323 Report PN expressed concern that
the incomplete and inaccurate ownership data submitted to the
Commission render it difficult to accurately track broadcast ownership
trends from 2009 and 2011. One commenter suggested that the manner in
which the Commission currently provides broadcast ownership data from
Form 323 to the public does not meet the objective that such data be
capable of being electronically searched, aggregated, or cross
referenced. On June 27, 2014, the Bureau issued an Order as part of the
2014 Quadrennial Regulatory Review proceeding seeking comment on the
2014 323 Report. Certain commenters responding to the data contained in
the 2014 323 Report acknowledged that the Commission has taken steps to
improve the quality of its broadcast ownership data, but asserted that
the Commission should do more to make its broadcast ownership data
easier to use, search, aggregate, and cross reference electronically,
for the benefit of studies and analysis.
18. On January 3, 2013, the Commission released its Sixth Diversity
Further Notice, in which it sought comment on the Commission's
requirement that licensees and other entities filing Form 323 provide a
CORES FRN--which requires submission of an SSN or TIN to the
Commission--for attributable individuals. Noting that the CORES FRN
enables unique identification of individuals, the Commission sought
comment on its proposal to eliminate the interim SUFRN. The Commission
reasoned that SUFRNs do not provide a reliable means of linking a
reported interest holder to a unique individual and the continued use
of the SUFRN undermines the Commission's efforts to ``accurately
ascertain the nature and extent of minority and female ownership of
broadcast properties.'' Pointing out that the Third Circuit in
Prometheus II highlighted the importance of reliable data to support
rulemaking initiatives, the Sixth Diversity Further Notice asked for
comments on the importance of the CORES FRN as a unique identifier for
increasing the quality, cross-referencing, aggregability, and
searchability of broadcast station ownership data. In discussing the
considerations attendant to requiring that attributable interest
holders submit an SSN to the Commission, the Sixth Diversity Further
Notice noted that other governmental agencies require SSNs ``to ensure
program integrity and for statistical and research purposes.'' The
Commission invited comment on its tentative conclusion that the Privacy
Act does not prohibit adoption of the CORES FRN proposal and asked
commenters to discuss the degree of the risk to privacy the proposal
poses in the event that commenters believe that the requirement
presents such a risk. The Commission also noted that it has already
adopted a Privacy Act System of Records Notice (SORN) for CORES and
with respect to the Form 323 requirement, which applies to any
personally identifiable information required by Form 323 and CORES in
connection with the CORES FRN registration process. The Sixth Diversity
Further Notice also sought comment on whether the Commission should
amend section 1.8002 of the Commission's rules, which provides that
persons ``doing business'' with the Commission must obtain a CORES FRN.
The Commission also asked whether it should continue to permit filers
to use the SUFRN in the event that reportable individuals are unwilling
to provide their SSN to a third party or unwilling to obtain and
provide a CORES FRN. The Commission also proposed to extend the CORES
FRN requirement to all entities and individuals reported on Form 323-E
and invited comment on potential costs and benefits associated with
that requirement. The Sixth Diversity Further Notice proposed to extend
the filing deadline for broadcast ownership reports to give filers an
additional 30 days. As noted above, the Sixth Diversity Further Notice
also sought additional comment on proposals regarding Form 323
submitted in the Review of Media Bureau Data Practices proceeding. The
notice specifically sought comment on certain proposals NAB and MMTC
submitted in that proceeding and sought input on the costs and benefits
associated with those proposals. The Sixth Diversity Further Notice was
published in the Federal Register on January 15, 2013. Comments on the
Sixth Diversity Further Notice were due on or before February 14, 2013
and reply comments due on or before March 1, 2013.
19. The Commission received significant opposition in response to
the Sixth Diversity Further Notice's proposal that all attributable
interest holders submit an SSN to the Commission in order to receive a
CORES FRN for use on broadcast ownership reports. As a result, on
February 12, 2015, the Commission released the Seventh Diversity
Further Notice, 80 FR 10442, Feb. 26, 2015, FCC 15-19, which proposed
to implement a new RUFRN--an identifier that would not require the
submission of an SSN to the Commission--for use on Form 323 and Form
323-E filings. This proposal reflected the Commission's effort to
balance its goal of collecting reliable ownership data with the
privacy, data security, and identity theft concerns of those
individuals with attributable interests in broadcast stations. As an
alternative to the CORES FRN, the proposed RUFRN would be generated
when an individual submits his or her full name, residential address,
date of birth, and only the last four digits of the individual's SSN.
20. The Commission reiterated its position that it must be able to
uniquely identify all parties, including individuals, reported on
broadcast ownership reports and tentatively concluded that the RUFRN
``will provide reasonable assurance of unique identification'' of
attributable individuals and is a superior method of uniquely
identifying individuals than the existing SUFRN. The Commission sought
comment on what additional information, if any, the Commission could
require to ensure that the data collected on the ownership reports will
be reliable.
21. The Commission also acknowledged that commenters to the Sixth
Diversity Further Notice argued that a CORES FRN cannot serve as a
unique identifier, because multiple FRNs could be associated with a
single TIN/SSN; an FRN may be associated with no TIN/SSN or an
incorrect one; or outside groups do not have access to the underlying
TIN/SSN information. The Seventh Diversity Further Notice stated that,
to guard against a single individual obtaining multiple RUFRNs, ``the
CORES system will be programmed to verify that the submitted
information is complete and does not duplicate any
[[Page 19437]]
information that is already associated with an RUFRN in CORES.'' In the
Seventh Diversity Further Notice, the Commission acknowledged the
privacy and security concerns raised in the Sixth Diversity Further
Notice as it related to the requirement that interest holders submit an
SSN, and reiterated that its systems, including CORES, have a security
infrastructure in place that exceeds Federal guidelines. The Commission
also sought comment on its tentative conclusion that the Privacy Act
does not bar the adoption of the RUFRN and its implementation on Form
323 and Form 323-E. Moreover, the Commission noted that it has already
adopted a Privacy Act SORN for CORES and with respect to the Form 323
requirement, and, if necessary, the SORN can be modified to address any
changes required by the implementation of the RUFRN on Form 323 and
Form 323-E. The Seventh Diversity Further Notice also emphasized that
the benefits of improved data collection outweigh any de minimis costs
or burdens associated with obtaining a CORES FRN or RUFRN. The
Commission explained that an individual that already has a CORES FRN
may continue to report it on the Form 323 or Form 323-E filings and
that there is no need to obtain an RUFRN.
22. The Commission sought comment on these subjects and its
conclusions that the RUFRN proposal will improve the reliability and
usability of the broadcast report data. The Seventh Diversity Further
Notice also sought comment on its conclusion that the RUFRN as a unique
identifier will permit the Commission to implement burden-reducing
modifications that could reduce the types of errors identified in the
2009, 2011, and 2013 filing periods.
23. The Commission also sought comment on extending the RUFRN to
Form 323-E in the event that changes proposed in the pending Fourth and
Sixth Diversity Further Notices are adopted. As discussed above, the
Fourth Diversity Further Notice proposed to collect race, gender, and
ethnicity information from attributable individuals reported on Form
323-E, and the Sixth Diversity Further Notice proposed to extend the
CORES FRN reporting requirement to noncommercial stations. In the
Seventh Diversity Further Notice, the Commission proposed that, in the
event those proposed changes are adopted, individuals reported on Form
323-E also may be permitted to obtain and provide an RUFRN in lieu of a
CORES FRN for use on the broadcast ownership report filings. The
Commission further acknowledged the comments opposing the Sixth
Diversity Further Notice proposal to extend the CORES FRN requirement
to NCE stations. There, commenters argued that the CORES FRN
requirement would be unduly burdensome and would discourage individuals
from serving on the boards of NCE stations. Moreover, commenters argued
that NCE station licensees would have difficulty obtaining SSNs from
board members, which may include government officials. The Seventh
Diversity Further Notice sought comment on how these concerns would be
implicated if RUFRNs were available as an alternative to CORES FRNs for
Form 323-E. The Commission noted that officers and directors of NCE
stations are already considered to be attributable interest holders in
NCE stations and are already required to be reported on Form 323-E and
sought comment on whether NCE stations present unique concerns with
respect to ownership reporting requirements that should be considered
by the Commission. The Commission also sought alternatives to the RUFRN
for the unique identification of individuals in the NCE context.
24. Finally, the Seventh Diversity Further Notice sought additional
comment on the elimination of the SUFRN, a proposal also contained in
the Sixth Diversity Further Notice. The Commission noted that
commenters previously supported the proposal to retain the availability
of the SUFRN for the limited purpose of reporting an individual that is
unwilling to provide his or her SSN to third parties or unwilling to
obtain and provide a CORES FRN and opposed the Commission's use of its
enforcement authority against individuals who failed to provide a CORES
FRN. The Seventh Diversity Further Notice sought comment on whether the
SUFRN should continue to be available to Form 323 filers (and, in the
event proposed modifications are adopted, to Form 323-E filers),
provided that a filer has used reasonable and good-faith efforts to
obtain a CORES FRN or RUFRN from or on behalf of an individual. The
Commission also asked whether the availability of the SUFRN would
protect filers in the case of recalcitrant individuals and whether
filers should be required to instruct individuals of the obligation to
obtain and provide a CORES FRN or an RUFRN. The Seventh Diversity
Further Notice also sought comment on the type of instruction and
notification of the risk of enforcement action the Commission should
provide or require if a CORES FRN or RUFRN is not reported for that
individual. The Seventh Diversity Further Notice was published in the
Federal Register on February 26, 2015. Comments were due on or before
March 30, 2015 and reply comments were due on or before April 13, 2015.
III. Discussion
25. By the actions the Commission here, the Commission advances its
commitment to improving the comprehensiveness and reliability of the
ownership data collected on Forms 323 and 323-E to enable more
effective analysis of ownership trends in support of policy initiatives
promoting diversity in ownership of broadcast stations. Accordingly,
the Commission will no longer allow filers to use SUFRNs on biennial
ownership reports, except in limited cases, and instead will require
that on such forms filers provide a CORES FRN or RUFRN for any
reportable individual attributable interest holder. In addition, the
Commission updates its reporting requirements for NCE stations to more
closely parallel the requirements for commercial stations. The
Commission also makes certain changes to its Form 323 and Form 323-E
aimed at reducing the filing burdens on broadcasters and improving data
collection. Finally, the Commission declines to adopt certain proposals
detailed in comments in this proceeding as redundant, unnecessary,
technically infeasible, or unsupported.
A. RUFRN Requirement
26. The Commission concludes that the RUFRN is important to the
Commission's ongoing mission to improve, streamline, and modernize the
way it collects and uses data. The Commission continues to believe that
it must be able to uniquely identify parties reported on broadcast
ownership reports for purposes of creating reliable and usable data in
support of the Commission's policy initiatives promoting diverse
ownership. The Commission has recognized that the TIN/SSN backed CORES
FRNs offer a unique identifier and therefore play an important role in
promoting the integrity of the data collected on Form 323. The
Commission, however, is also sensitive to concerns that have been
expressed regarding a mandate that every individual attributable
interest holder of a broadcast station submit his or her SSN to the
Commission for purposes of broadcast ownership reporting. The creation
of the new RUFRN mechanism within CORES, allowing individuals to obtain
a unique identification number without submitting a full SSN, properly
balances
[[Page 19438]]
the concerns of individual attributable interest holders with the
Commission's mandate to ensure the reliability and utility of its
broadcast ownership data.
27. Broadcast Ownership Reporting Using the RUFRN Supports the
Commission's Data Gathering and Policy Making Initiatives. The
Commission has previously recognized that sections 257 of the 1996 Act,
47 U.S.C. 257, and 309(j) of the Act, 47 U.S.C. 309(j), support its
efforts to gather the ownership data contained in Form 323. Section 257
directs the Commission to identify and eliminate ``market entry
barriers for entrepreneurs and other small businesses in the provision
and ownership of telecommunications services and information services,
or in the provision of parts or services to providers of
telecommunications services and information services.'' To implement
this mandate, the Commission is directed to ``promote the policies and
purposes of [the 1996 Act] favoring diversity of media voices, vigorous
economic competition, technological advancement, and promotion of the
public interest, convenience and necessity.'' As the Commission has
previously recognized, improving the reporting of ownership data
enables the Commission to carry out this mandate.
28. Similarly, pursuant to section 309(j), the Commission must
award licenses in a manner that ``promot[es] economic opportunity and
competition and ensur[es] that new and innovative technologies are
readily accessible to the American people by avoiding excessive
concentration of licenses and by disseminating licenses among a wide
variety of applicants, including small businesses, rural telephone
companies, and businesses owned by members of minority groups and
women.'' Congress directed the Commission to regulate in a manner that
ensures that ``small businesses, rural telephone companies, and
businesses owned by members of minority groups and women'' are
represented in licensed activities. The statute further requires that
the Commission ``ensure that small businesses, rural telephone
companies, and businesses owned by members of minority groups and women
are given the opportunity to participate in the provision of spectrum-
based services.'' As the Commission has previously determined, section
309(j) is evidence of a congressional policy in support of the grant of
broadcast licenses to a wide variety of groups, including minorities
and women.
29. In the 1998 Biennial Review Order, 63 FR 70040, Dec. 18, 1998,
FCC 98-281, rel. Nov. 25, 1998, the Commission concluded that, in order
to fulfill its statutory mandates, it must collect race, gender, and
ethnicity information from all interest holders reported on Form 323.
In the 1998 Biennial Review Order, the Commission stated that it would
take up at a later date whether to apply these requirements to Form
323-E, as well. The Commission now finds that these requirements should
be applied to Form 323-E, and the Commission's discussion on this
matter can be found below. Collecting these data enables the Commission
not only to assess the current state of minority and female ownership
of broadcast stations but also to determine the success of programs
that are designed to facilitate opportunities for women- and minority-
owned businesses and to promote a diversity of media voices. Just as it
is essential for the Commission to collect these ownership data to
fulfill its mandates, it is important that these data be reliable,
aggregable, and useful for studies and trend analysis by others.
30. The Commission finds that flaws in the current practices
related to the reporting of SUFRNs for individuals listed on Form 323
compromise the integrity of the data collected and thereby frustrate
the Commission's attempts to fulfill its statutory mandates under
section 257 and section 309(j). The SUFRN was devised as merely a
computer-generated number to be created by clicking a button within
Form 323 itself and not backed by any identifying information. The
Commission collects no information when the system generates a new
SUFRN, and there is no database analogous to CORES that contains
uniquely identifying information associated with SUFRNs. The SUFRN
therefore offers the Commission no way to cross reference or trace back
reported information to a single individual. It was intended only as an
interim measure. Based on the Commission's experience reviewing the
ownership reports submitted during three separate biennial reporting
cycles, it is clear that SUFRNs have been used in a manner that is
inconsistent with the Commission's direction and that undermines the
integrity of the data. On the one hand some SUFRNs have been used in
conjunction with multiple individuals, and on the other hand
individuals have used multiple SUFRNs. Because the Commission currently
cannot determine whether two SUFRNs identify one or more individuals,
it cannot reliably examine the complete attributable holdings of an
individual reported with an SUFRN (either at a specific time or over
time), or search, aggregate, and cross reference the ownership data.
Any attempt at such analysis would require manual analysis of every
single entry where an SUFRN appears together with a subjective analysis
of other textual information contained on the form or available from
other public sources. The Media Bureau cannot confidently determine the
number of individuals reporting SUFRNs. In the 2011 biennial ownership
reports, the Bureau found that 3,326 unique SUFRNs were reported, and,
because some were reported multiple times, SUFRNs were used in 8,719
instances. Because it is possible for filers to improperly report
SUFRNs for individuals--either reporting multiple SUFRNs for a single
individual on multiple reports or using the same SUFRN for multiple
individuals on multiple reports--despite instructions to the contrary,
the Bureau concluded that the number of unique SUFRNs reported during
the 2011 filing period cannot be relied on to accurately determine the
number of individuals using SUFRNs. Manual, subjective analysis of
thousands of Form 323 entries using various sources of information
compromises data integrity and data utility. Consequently, the
Commission cannot rely on the SUFRNs reported to provide reliable
ownership data.
31. In the Sixth Diversity Further Notice, 78 FR 2925, Jan. 15,
2013, FCC 12-166, rel. Jan 3, 2013, the Commission tentatively
concluded that TINs/SSNs within CORES were necessary as underlying
unique identifiers of individuals. Commenters to the Sixth Diversity
Further Notice strongly objected to the proposed Commission mandate
that all individual attributable interest holders submit an SSN to the
Commission to obtain a traditional CORES FRN.
32. In contrast, in the Seventh Diversity Further Notice, 80 FR
10442, Feb. 26, 2015, FCC 15-19, rel. Feb. 12, 2015, the Commission
tentatively found that a proposed alternative to the traditional CORES
FRN would provide a reasonable basis for determining that an individual
is uniquely identified within the CORES system. Specifically, the
Commission proposed making available a new identifier, the RUFRN.
Filers wishing to use this identifier would be required to submit an
individual's full name, residential address, date of birth, and only
the last four digits of the individual's SSN. In response to the
Seventh Diversity Further Notice, commercial broadcasters and public
interest groups support the alternative RUFRN approach. Some
[[Page 19439]]
commenters argue that the use of SUFRNs on Form 323 ``ha[s] introduced
inaccuracy and uncertainty into media ownership data,'' because SUFRNs
are not backed by identifying information that can reliably be linked
to a unique individual. While the CORES FRN system is a superior
solution, RUFRNs are a sufficient means for identifying individuals and
allowing longitudinal analysis of media ownership trends, they state.
No commenters propose additional or different pieces of information
that would better enable the Commission to ensure that individuals are
uniquely identified.
33. Some commenters disagree that the RUFRN proposal is superior to
the existing SUFRN system. Although these commenters focus primarily on
issues related to NCE attributable interest holders, which are
addressed in detail below, some of the arguments suggest that the use
of RUFRNs will not substantially and meaningfully improve the quality
of the Commission's broadcast ownership data generally. These
commenters assert that if SUFRNs are being misused, it is either due to
mistakes or conscious decisions not to comply with Bureau guidance.
According to these commenters, either remains possible with the
proposed RUFRN system. The Alabama Educational Television Commission
(AETC) et al. argue that users could accidentally enter information
incorrectly, forget to enter a previously used SUFRN or FRN, or
intentionally violate the Commission's rules, and that errors could
also stem from data entry problems on Form 323 itself, such as
inadvertent or intentional mistyping of RUFRNs, SUFRNs, or FRNs. AETC
et al. urge the Commission to retain the SUFRN for individual
attributable interest holders that refuse to obtain a CORES FRN or
RUFRN, without imposing substantiation requirements, and to
specifically exclude ``NCE and non-profit licensees'' from the new
RUFRN requirement. The Commission addresses these two requests below
and addresses here the more general assertion. In addition, commenters
state, insofar as the Commission intends to allow use of ownership data
by third-party researchers, much of the benefit that comes from the use
of RUFRNs is negated by the Commission's proposal to hold securely and
confidentially within CORES all identifying information used to obtain
RUFRNs, except for names and the RUFRNs themselves.
34. The Commission finds that its policy initiatives are dependent
on the quality of the data collected. The Commission concludes that
having reasonable assurance that attributable interest holders are
uniquely identified on ownership reports in a manner that ensures that
the data can be meaningfully searched, aggregated, and cross referenced
electronically is crucial to the quality and usability of the
Commission's ownership data. The Commission concludes that the SUFRN
cannot provide unique identification of individual attributable
interest holders on broadcast ownership reports, and the Commission
concludes that requiring an FRN generated by CORES, either through
existing mechanisms or via the RUFRN method, for all attributable
interest holders on broadcast ownership reports is essential to improve
the quality and usability of the data collected. The Commission
therefore adopts the RUFRN as an alternative mechanism within CORES
that will allow an individual (not entities) to obtain an RUFRN by
submitting an alternate set of identifying information that does not
include a full SSN: Full name, residential address, date of birth, and
the last four digits of the individual's SSN.
35. The identifying information provided by the individual will be
stored confidentially within CORES, as other sensitive information is
stored in CORES to support CORES FRNs issued pursuant to existing
functionalities. Only the individual's name and RUFRN will be available
publicly. Both the RUFRN and the associated ownership information will
be entirely machine readable and will not require manual consideration
of each biennial ownership form to analyze whether various Form 323
entries might identify the same individual or different individuals.
The same is true for the CORES FRN and underlying TIN. The CORES system
will be programmed to verify that the information submitted by the
applicant is complete and does not duplicate any information that is
already associated with an RUFRN in CORES. The Commission concludes
that, since RUFRNs will be backed by identifying information, and since
CORES will not issue multiple RUFRNs for the same identifying
information, RUFRNs can be relied on to identify individuals uniquely.
When the applicant obtains an RUFRN, the applicant will be asked to
list all CORES FRNs registered to the individual and all SUFRNs the
individual previously used in any broadcast ownership report filings
since the 2009 biennial reporting cycle. The Commission concludes that
such disclosures will allow it to identify CORES FRNs, RUFRNs, and
SUFRNs that identify the same individual, promoting the usefulness of
the broadcast ownership data for purposes of electronic searching,
aggregating, and cross-referencing and for trend analysis. RUFRNs may
be used only on broadcast ownership reporting forms and only for
individuals (not entities) reported as attributable interest holders.
Once an RUFRN is issued, any ownership report filing that lists the
individual associated with that RUFRN will be required to include that
RUFRN. However, an individual may opt to use a traditional CORES FRN
instead of obtaining and using an RUFRN. In the Sixth Diversity Further
Notice, the Commission sought comment on the Koerner & Olender Petition
for Reconsideration, which requested that the Commission either
reconsider its requirement that individuals holding attributable
interests obtain a CORES FRN, which in turn would require such
individuals to provide the Commission with their SSN, or ``redefine or
reinterpret'' section 1.8002 of the Commission's rules to clarify that
individuals with reportable interests must obtain a CORES FRN. The
Commission notes that the petition's concerns about the disclosure of
individuals' full SSNs are addressed by the RUFRN system the Commission
is adopting, which will allow individual attributable interest holders
to obtain an RUFRN without disclosing their full SSNs to the
Commission. Thus, the Commission grants the petition to the extent
Koerner & Olender sought reconsideration of the requirement for
individuals holding attributable interests in licensees to provide
their SSN to the Commission. Further, since the Commission is not
requiring such individuals to obtain a CORES FRN, which is the
identifier addressed by section 1.8002, there is no need to modify
section 1.8002 in connection with the adoption of the RUFRN
requirement. The Commission therefore denies the Koerner & Olender
Petition for Reconsideration to the extent it requests that the
Commission amend section 1.8002. With this Report and Order, all the
issues raised in the Fletcher Heald Petition for Reconsideration are
resolved. The Fletcher Heald Petition for Reconsideration requested
that the Commission provide additional opportunity for public comment
on the CORES FRN requirement before requiring the reporting of CORES
FRNs for individuals reported on Form 323 due to concerns about the
disclosure of individuals' full SSNs. The Commission has issued two
further notices of proposed rulemaking to consider these issues.
Consistent with the discussion in
[[Page 19440]]
this Report and Order, the Commission grants the Fletcher Heald
Petition for Reconsideration to the extent it seeks reconsideration of
the requirement that filers provide a traditional CORES FRN, requiring
the submission of a full SSN/TIN, for every individual attributable
interest holder reported on Form 323. Filers are permitted to provide
RUFRNs, requiring submission of an alternate set of identifying
information that does not include a full SSN, in lieu of CORES FRNs for
individuals reported on Form 323. In addition, the Commission will
continue to allow the use of SUFRNs on Form 323 in the limited
circumstances described below. To the extent that the Fletcher Heald
Petition for Reconsideration seeks relief inconsistent with the actions
taken in this Report and Order, the Commission denies the Fletcher
Heald Petition for Reconsideration.
36. The Commission does not believe that the existence of possible
situations or limitations some commenters identified in objecting to
the RUFRN compel the Commission to abandon its conclusion that RUFRNs
offer superior data quality to SUFRNs for the purpose of broadcast
ownership reports. As the Commission stated in the Seventh Diversity
Further Notice, the Commission expects that individuals and entities
will comply with the Commission's rules and provide accurate
information during the CORES registration process to the greatest
extent possible. Moreover, the Commission finds that the specificity of
the identifying information required to obtain an RUFRN and the fact
that a number of pieces of information are required will be sufficient
to provide the Commission with reasonable certainty that the
information identifies a unique filer within the CORES system. While
holding some of this information confidential does limit the ability of
outside researchers to use it to ensure unique identification, that
limitation does not decrease the ability of the Commission to do so,
just as the confidentiality of an SSN underlying a CORES FRN does not.
Further, the Commission's obligation to hold confidential the
identifying information underlying the RUFRN will not limit appreciably
the utility of RUFRNs to outside researchers as a unique identifier,
because the RUFRN application will include a mechanism to prevent
issuance of multiple RUFRNs based on the same identifying information
(i.e., issuance of multiple RUFRNs to the same individual). As
described above, the raw Form 323 biennial ownership data is available
to the public, and the Media Bureau has released reports reflecting its
analysis of ownership data submitted for the 2009, 2011, and 2013
reporting rounds. Future, similar reports are contemplated reflecting
additional biennial reporting periods. Based on the Commission's
experience in the 2009, 2011, and 2013 reporting cycles, the Commission
concludes that the RUFRN will improve the reliability and usability of
the broadcast ownership report database, in furtherance of the
Commission's statutory mandates. As discussed elsewhere in this Report
and Order, the Commission's examination of ownership reports from 2009,
2011, and 2013 revealed numerous data reporting errors, and the
Commission has no reason to believe that all of these errors were the
result of filers attempting to deliberately mislead the Commission. The
presence of a unique identifier improves the quality of the
Commission's ownership data by permitting errors to be identified and
remedied. For example, the presence of the same individual's RUFRN on
multiple reports, along with inconsistent gender and/or race
information, may indicate one or more reporting errors that can then be
cured. In light of the foregoing, the Commission rejects commenters'
arguments that the use of RUFRNs to identify individuals is
inconsequential for the purpose of tracking ownership trends.
37. RUFRNs Are Not Burdensome, and the Benefits Outweigh the Costs.
The Commission concludes that its decision to allow individual
attributable interest holders the option of obtaining and using an
RUFRN in lieu of a traditional CORES FRN will impose minimal costs and
burdens, if any, on individuals or filers. As noted above, individuals
who already have a CORES FRN will be able to continue using their
existing number without having to register for an RUFRN, and any other
reportable individual that wishes to obtain a CORES FRN instead of an
RUFRN will still be able to do so. Like registering for a CORES FRN,
registering for an RUFRN will be a one-time process that takes a few
moments to complete. An individual need only fill out a short online
form requiring just a few pieces of information: A name, address, birth
date, and the last four digits of the SSN. The applicant also provides
a password and a personal security question (to help in case the
applicant later misplaces or forgets his or her password). There are at
most de minimis costs or burdens associated with obtaining the number.
An individual does not need to provide personal information to anyone
other than the Commission to obtain a CORES FRN or RUFRN. That
information can be provided to the Commission alone, and then the CORES
FRN or RUFRN can be provided to a licensee for reporting purposes. In
addition, the RUFRN will serve as a unique identifier that can be cross
referenced easily, which will enable the Commission to make certain
modifications to broadcast ownership reporting that will reduce the
burdens on all filers, as described below, and therefore further
improve the quality of the ownership data submitted to the Commission.
The Commission concludes that these benefits outweigh the de minimis
costs or burdens associated with obtaining an RUFRN. Although some
commenters argue that implementing the RUFRN would impose specific
burdens on NCE licensees, as discussed below, no commercial entity
disputes the Commission's finding that RUFRNs will not be burdensome
for commercial entities or individuals holding attributable interests
in them. AETC et al. argue that the RUFRN requirement will be overly
burdensome, particularly for ``NCE and non-profit licensees.'' Below,
the Commission addresses burden-related arguments specific to NCE
stations.
38. Security of Commission Systems. In the Sixth Diversity Further
Notice, 78 FR 2925, Jan. 15, 2013, FCC 12-166, rel. Jan 3, 2013, the
Commission sought comment on any security concerns related to the
requirement that a TIN/SSN for every attributable interest holder be
provided to the Commission. The Commission noted that while TIN/SSN
data is collected during the CORES FRN registration process, TINs/SSNs
are not disclosed on any Commission application or form, including
Forms 323 and 323-E. Commenters raised concerns that a CORES FRN
requirement for individuals will open individuals to threats of
identity theft. Some commenters pointed to a system breach described in
a GAO report on information security (Information Security GAO Report),
GAO-13-155, Jan. 2013, and suggested that the Commission's systems are
vulnerable to a security breach. In the Seventh Diversity Further
Notice, 80 FR 10442, Feb. 26, 2015, FCC 15-19, rel. Feb. 12, 2015, the
Commission described the safeguards in place on the Commission's
systems and improvements that have been implemented to assure the
security of the Commission's systems, including that of CORES. The
Commission reiterated that security continues to be
[[Page 19441]]
one of the Commission's highest priorities, and sought comment on
whether the elimination of the requirement of individual attributable
interest holders to submit a full SSN to CORES eliminates the privacy
and identity theft concerns that have been previously raised. The
Commission also asked for guidance on how to address any remaining
concerns that are not alleviated, and whether those concerns outweigh
the importance of the data collection.
39. In response, NAB states that RUFRNs, because they create a
unique identifier without requiring individuals to submit full SSNs to
the Commission, provide a ``safety valve'' for individuals who might be
reluctant to obtain a CORES FRN due to data privacy and security
concerns. NAB claims this is accomplished without compromising the
quality of the Commission's ownership data. Thus, states NAB, the RUFRN
proposal for commercial broadcasters reflects a better balancing of
affected interests than simply eliminating the SUFRN and mandating
CORES FRNs in all cases.
40. NCE commenters, on the other hand, continue to express concerns
about identity theft, even though the RUFRN does not require the
disclosure of full SSNs. NCE commenters state that the existence of an
individual's name, address, date of birth, and the last four digits of
an SSN would permit hackers to predict a full SSN. Some commenters cite
a study conducted by researchers at Carnegie Mellon University. In that
study, researchers were able 44 percent of the time to predict the
first five digits of individual SSNs for persons born after 1989.\6\ In
addition, some commenters note that higher education institutions have
recognized the need to protect the confidentiality of individuals'
birth dates and the last four digits of their SSNs. As an example,
these commenters cite the California State University System's
Information Security Data Classification standards, which mandate the
highest level of information security for an individual's birth date
combined with the last four digits of the SSN and state that
unauthorized disclosure of that information could result in ``severe
damage to CSU, its students, employees or customers.'' Even if an
individual's full SSN is not reconstructed, assert AETC et al., a
successful hacker could still gain access to countless private accounts
held by those interest holders because many financial institutions,
utility accounts, and other businesses use the last four digits of the
SSN to restore a lost password or access an account, frequently in
combination with other information the Commission proposes to require
for an RUFRN. NCE commenters also raise concerns regarding the
potential disclosure of individuals' residential addresses, stating
that NCE board members are often public officials or other prominent
individuals who wish to keep this information private for the safety of
themselves and their families. In the Seventh Diversity Further Notice,
the Commission proposed that, for the RUFRN, the individual's name and
RUFRN could be available publicly but the remaining identifying
information would be held securely and confidentially within CORES. As
stated there, the Commission has taken steps and put in place
procedures to assure the security of the Commission's systems.
Moreover, the Commission continues to strengthen the security of its
systems, as discussed below.
---------------------------------------------------------------------------
\6\ See American Association for the Advancement of Science,
Social Security Numbers are Easy to Guess, Science News, from the
journal Science (July 6, 2009), https://news.sciensemag.org/2009/07/social-security-numbers-are-easy-guess.
---------------------------------------------------------------------------
41. Even if the Commission's systems have not been breached to
date, NCE commenters argue, there is no assurance that a successful
breach will not occur in the future. They again point to the
Information Security GAO Report and cite to reports of recent breaches
at the White House and other Federal offices. Some commenters claim
that the risk of breach would increase if the Commission begins storing
in CORES information about NCE board members because some are public
officials or other prominent individuals. Although it is sometimes
necessary to collect personal information that can be used for identity
theft, AETC et al. assert, to provide maximum protection, the
collection of such information must be limited to situations where
there is no alternative.
42. As stated in the Seventh Diversity Further Notice, the
Commission agrees with commenters that privacy and security with
respect to personally identifiable information are paramount, and the
Commission remains committed to protecting such interests. The
Commission notes that its systems currently safely house a significant
amount of information that is the same, similar, or--in the case of
full SSNs--even more sensitive than the information underlying the
RUFRN. Despite commenters' repeated citation to the Information
Security GAO Report, as the Commission has stated before, the
Commission is not aware of any breaches to CORES. As the Commission has
previously stated, the Commission was in the process of implementing
certain improvements before the completion of the Information Security
GAO Report, and the Commission continues to strengthen its security
environment using the recommendations contained in the Report. The
Information Security GAO Report did not identify any security
deficiencies in CORES. For the Commission's statement regarding its
response to the security breach and the deployment of the Enhanced
Secured Network Project, see pages 26 through 29 of the Information
Security GAO Report. The enhanced perimeter controls, malware
protection, and monitoring devices continue to be in place, and the
workstation operating systems are routinely upgraded with improved
security. The Commission's systems and security architecture continue
to contain robust strict operational controls that comply with National
Institute of Standards and Technology guidance. The Commission's system
servers remain behind several firewalls, and security controls continue
to be upgraded to protect CORES data from intrusion by outsiders and
the general Commission population. Furthermore, the Commission has
recently moved to a Managed Trusted Internet Protocol Service (MTIPS)
provider that will move the Commission from being Internet Protocol
Version 4 to Internet Protocol Version 6 going forward. Again,
administrative access to CORES remains limited and all servers continue
to be monitored through the use of automated tools and operational
procedures. The Commission will continue to make the necessary upgrades
to ensure the security of CORES and all of its systems, and protecting
the personally identifiable information contained in its system will
remain one of the Commission's highest priorities.
43. No commercial entity has contested the Commission's proposal to
implement the RUFRN system for individual attributable interest holders
in commercial broadcast stations, and NCE commenters have offered no
compelling reason why the Commission must conclude that the system
security needs or risks of NCE attributable interest holders are
greater than those of commercial attributable interest holders. Indeed,
the quality of the information is similar or exactly the same. The
observation that NCE attributable interest holders may be public
officials or other prominent individuals is also true in the commercial
realm. The Commission takes its data security obligations to all
entities and individuals that have confidential
[[Page 19442]]
information housed within the Commission's systems extremely seriously.
Commenters also concede that it is sometimes necessary to collect
personally identifiable information when no alternative method exists.
Indeed, this is such a situation. As noted above, to fulfill its
statutory mandate to promote diversity of media voices and avoid
excessive concentration of licenses by disseminating them to, among
others, businesses owned by members of minority groups, the Commission
must have reliable, comprehensive data reflecting the attributable
interest holders in broadcast stations. The Commission has repeatedly
requested comment on alternatives that would balance the Commission's
need to uniquely identify individual attributable interest holders on
the biennial ownership reports with privacy needs. No commenter in this
proceeding has offered an alternative to the CORES FRN or RUFRN and the
Commission has concluded that the SUFRN is not a suitable alternative.
The Commission believes that that the RUFRN as an alternative to a
traditional CORES FRN is a reasonable approach that balances the
Commission's need to uniquely identify reportable individuals with the
security and privacy concerns raised by the commenters. No commenters
assert that the Privacy Act would bar the adoption of the RUFRN
requirement for the reporting of attributable interest holders on
ownership reports for either commercial stations or NCEs. The
Commission finds that the RUFRN requirement described herein is
consistent with the Privacy Act for Form 323 and Form 323-E. The
Commission directs the Media Bureau to prepare the necessary documents
to comply with the Privacy Act.
B. Improvements to Data Collection From NCE Stations
44. To enhance the completeness of the Commission's data
collection, promote data integrity, and ensure that data are
electronically readable and aggregable, the Commission revises Form
323-E for NCE stations to collect race, gender, and ethnicity
information for attributable interest holders, require that CORES FRNs
or RUFRNs be used, and conform the biennial filing deadline for NCE
broadcast ownership reports with the biennial filing deadline for
commercial station ownership reports. In limited circumstances there
may be additional parties--other than officers or directors--that hold
attributable interests in an NCE station. For example, some states
allow non-profit organizations to issue voting stock or the equivalent
thereto. Holders of five percent or more of the voting stock of such
entities are attributable owners pursuant to section 73.3555, Note
2(a), and must be reported on Form 323-E in the same manner as officers
and directors (including the provision of a CORES FRN and, in the case
of individuals, race, gender, and ethnicity information). As noted
below, the Commission's revisions to Form 323-E and its instructions
confirm this point. Attached to this Report and Order is a draft of the
revised version of Form 323-E that will be submitted for OMB approval.
The draft revised version of Form 323-E that is attached to this Report
and Order at Appendix E resembles in several ways the draft revised
version of Form 323 that is attached to this Report and Order at
Appendix D and, where applicable, includes counterparts to the
modifications to Form 323 discussed herein. Section and question
references in this Report and Order refer to the current version of the
form, which is implemented in the Commission's Consolidated Database
System (CDBS). Because the revised version of the form will be
implemented in the Commission's Licensing and Management System (LMS),
it will be given a new number, and its format, structure, and question
identification will differ from the CDBS version of the form. When
discussing issues concerning Form 323-E, some commenters suggested that
the Commission make changes to forms other than its broadcast ownership
reports. The Commission declines to do so at this time, as these
proposals are outside the scope of this proceeding.
45. Including NCE Stations Improves Data Completeness. As noted
above, the Commission has previously determined that it has authority
under section 257 and section 309(j) to collect ownership information
from commercial broadcast stations. The Commission finds that its
analysis with regard to the collection of data from commercial stations
is equally applicable in the NCE context. NCE stations hold Commission
licenses, as do commercial licensees. Their programming impacts local
communities. Nothing in the statute distinguishes the noncommercial
nature of any segment of a service as exempting it from the overall
statutory mandates. Accordingly, the Commission finds that it has
authority to collect race, gender, and ethnicity information from
attributable interest holders in NCE stations, and the Commission
affirms the conclusion in the Fourth Diversity Further Notice that
doing so will further the Commission's goal of designing policies to
advance diversity. Further, the adoption of the CORES FRN requirement
in the context of Form 323-E is supported by the Commission's statutory
mandates under section 257 of the 1996 Act and section 309(j) of the
Act.
46. The Commission has previously found that, in order to adopt
policies or regulations to promote minority and female ownership of
broadcast stations, it is imperative to have information about female
and minority ownership in broadcasting as a whole--specifically
including ``the entire universe of NCE stations.'' In light of this,
commenters who assert that there is no policy justification for the
Commission to collect ownership data from NCE stations are incorrect.
Similarly, the Commission disagrees with commenters who suggest that
collection of ownership data from NCE licensees is unnecessary because,
pursuant to section 73.3555(f) of the Commission's rules, NCE stations
are not subject to the Commission's multiple ownership restrictions.
The GAO and outside researchers have criticized the Commission
specifically for its failure to collect data concerning ownership of
NCE stations, and many have described prior data collections as
incomplete.
47. The Fourth Diversity Further Notice, 74 FR 25205, May 27, 2009,
FCC 09-33, rel. May 5, 2009, sought comment on the proper definition of
``ownership'' in the NCE context, asking whether looking at the
composition of the board of directors or other governing body of an NCE
station would be appropriate for determining ``ownership'' for Form
323-E purposes. Several commenters support this approach, noting, for
example, that board members have legally cognizable duties to the
station licensees, often are involved in station operations and hiring
decisions, have final authority over NCE licensees, and are responsible
to the local communities they serve. Other commenters argue that
dissimilarities between the governance of commercial and NCE stations
precludes any definition of ``ownership'' in the NCE context. These
parties note that board members do not have equity stakes in the
stations they serve; are often governmental officials, governmental
appointees, individuals elected by station members, or volunteers; and
often are not involved in day-to-day station operations. Commenters
also made similar arguments as they related to the proposals raised in
the Sixth and Seventh Diversity Further Notices.
[[Page 19443]]
48. Officers and directors of NCE stations already are defined as
attributable interest holders in NCE stations and they already are
reported on Form 323-E. The Commission finds that the additional
requirements it imposes here--including requiring race, gender, and
ethnicity information, and a CORES FRN or RUFRN--do not involve
crafting or imposing a new legal definition of ``ownership'' with
respect to NCE stations. For Form 323 and Form 323-E purposes, the
concept of ownership relies on the attribution standards set forth in
section 73.3555 of the Commission's rules, which generally do not
depend on equity interests but instead ``seek to identify those
interests . . . that confer . . . a degree of influence or control such
that the holders have a realistic potential to affect the programming
decisions of licensees or other core operating functions.'' The
National Federation of Community Broadcasters and the Prometheus Radio
Project ask what percentage voting interest standard is applicable to
Form 323-E. Revised Form 323-E relies on the standards set forth in
section 73.3555. Arguments that the Commission should not impose these
additional requirements for NCE stations because the individuals have
no equity ownership therefore are not compelling.
49. Individuals or entities that hold attributable ownership
interests in commercial broadcast stations often do not hold equity
interests in those stations. For example, an officer or director of a
commercial broadcast licensee is an attributable owner of the
licensee's station(s), regardless of whether he or she has any equity
interest in the licensee. As discussed below, an officer or director
may be granted an exemption from attribution only if his or her duties
are wholly unrelated to the licensee. Members of partnerships and
limited liability companies likewise are attributable owners,
regardless of whether or not they hold an equity stake. Such parties
may be insulated from attribution, regardless of equity stake, if they
certify that they will not be materially involved in any way in the
licensee and the relevant organizational documents provide for such
insulation. It is not uncommon for limited liability companies or
partnerships to assign little or no equity to the member(s) or
partner(s) that hold the voting interest and assign all or most of the
equity to members or limited partners that have no votes and/or are
insulated pursuant to the relevant Commission criteria. Voting stock
interests held in trust are attributable to the parties who can vote
the stock, which usually include the trustee but may or may not include
the beneficiary (the party that holds the equity). Non-voting stock
cannot give rise to an attributable ownership interest, even though it
has equity value, unless the Commission's EDP Rule is implicated.
Moreover, while an individual's or entity's equity stake can play a
role in determining attribution under the EDP Rule, the equity is not
an issue in and of itself; rather, the rationale is that the
individual's or entity's combined equity and debt stake, plus
additional factors specified in the rule, provide the requisite ability
to influence the licensee. Further, a party that is attributable under
the EDP Rule may have no equity stake in the licensee whatsoever, but
instead be attributable based on a significant debt-only interest
(coupled with the other specified factors). Simply put, the
Commission's standards for attributable ownership generally do not
depend on equity positions, and many parties hold attributable
interests in stations without any equity involvement in those stations.
These attribution standards apply to both commercial and noncommercial
stations, and the individuals and entities these standards capture have
the potential to exert influence over the licensee, regardless of
whether the station at issue is commercial or noncommercial. While the
rule provides an example using the attribution standards to evaluate
mutually exclusive NCE applications under the Commission's point
system, the Commission has made clear that the section 73.3555
attribution standards apply whenever attribution issues are relevant
for NCE purposes. Officers and directors therefore are attributable
owners of the NCE licensees they serve. In certain limited cases, a
non-profit entity holds a commercial license. Several such licensees
indicate that, because they are not commercial entities, much of Form
323 contains questions that are inapplicable to their structure, and
these licensees ask to use Form 323-E instead. The Commission will deem
the filing of Form 323-E, in accordance with the standards set forth
herein, compliant with the Commission's biennial filing obligation
where a non-profit entity holds a commercial license.
50. The observation that NCE board members are often governmental
officials, governmental appointees, individuals elected by station
members, or volunteers does not lead the Commission to a different
conclusion. The Commission's attribution standards depend not on the
manner in which an individual came to be a member of a station's board
of directors or other governing body, but rather on the ability to
influence station programming or operations that his or her membership
confers. Similarly, because a party can exert influence over a station
without being involved in the day-to-day operations of that station,
the Commission's attribution rules do not depend on--or even
reference--such involvement. Instead, officers and directors are
attributable owners because holders of such positions have a realistic
potential to affect station programming or core operations. While the
extent to which NCE officers or directors are involved in day-to-day
station operations may vary, this situation is not unique to NCE
stations and does not provide a basis for different treatment.
51. The Commission's rules do, however, allow officers and
directors to be exempted from attribution in limited circumstances.
Specifically, an officer or director can be exempted from attribution
in an entity that is involved in businesses other than broadcasting,
provided that his or her duties are wholly unrelated to the operation
of the broadcast station(s) at issue. One commenter questions whether
such exemptions are available in the NCE context. The Commission
reiterates that its attribution standards, including the standards
applicable to attribution exemptions for officers and directors, apply
to both commercial and NCE stations. The Commission's revised Form 323-
E, like its current and revised versions of Form 323, reflects the
attribution exemption for certain officers and directors. The
Commission reminds filers, however, that an attribution exemption
cannot be invoked for an officer or director unless he or she does not,
and will not, have the ability to influence the broadcast operations of
the licensee or station(s).
52. The Fourth Diversity Further Notice also asked for input
concerning the burden of providing race and gender information on Form
323-E. Several commenters argue that requiring the collection and
reporting of such information would be unduly burdensome and might
discourage board participation. Similarly, several commenters argue
that requiring filers to report CORES FRNs or RUFRNs for attributable
interest holders on Form 323-E would be unduly burdensome and would
discourage individuals from serving on the boards of NCE stations. As
explained below, the Commission also rejects these arguments. Other
commenters argue that the collection of
[[Page 19444]]
race and gender information would be minimally burdensome and agree
with the Commission's tentative conclusion that such information is
necessary to construct a complete picture of minority and female
participation in broadcasting. As a result of the Commission's
commitment to obtaining robust and complete ownership data concerning
minority and female participation in broadcasting, the Commission
believes that the collection of this information about the NCE station
category is necessary. The absence of such information with respect to
NCE stations restricts the Commission's ability to comprehensively
consider broadcasting's impact in local markets. The GAO Report
specifically identified the Commission's failure to collect this race,
gender, and ethnicity information from NCE stations as a key reason
that the agency lacks comprehensive data on ownership of broadcast
outlets by minorities and women. Moreover, the Commission is
unconvinced that providing this information would be burdensome or
discourage participation because many NCE stations already provide
similar information in an annual report to the Corporation for Public
Broadcasting (CPB). Of the approximately 4,500 NCE FM and television
stations, CPB provides financial support to approximately 1,400
stations (FM and television). Stations that receive funding must submit
an annual Station Activity Survey (SAS), which collects, among other
data, general race/ethnicity information by gender of the stations'
board members (e.g., two African-American female board members and one
Hispanic male board member). CPB then issues an annual report that
provides an overview of diversity in the public media industry,
including programming and station employment and operation, though the
report does not necessarily provide a breakdown of the demographic
information collected with respect to the board members of individual
stations. The record does not reflect that the CPB reporting is
burdensome or discourages participation, and the Commission does not
believe that providing similar information to the Commission would have
a significantly different impact. Stations that receive CPB support
already have procedures for the collection and reporting of similar
demographic information on board members of these station licensees to
a third party. The Commission notes, however, that for various reasons,
the CPB data collection cannot be used as a substitute for the data
collected on Form 323-E. For example, CPB does not collect information
from all NCE stations; CPB data does not contain the same level of
detail necessary to provide the snapshot of ownership data to
effectively study and analyze ownership trends together with Form 323
data; there is no way to incorporate CPB's data into LMS to create a
searchable and aggregable database; and there is no public access to
CPB's underlying data to permit analysis and study. Additionally, the
other actions adopted herein should reduce the burdens on all filers.
Therefore, the Commission believes that any additional burdens
associated with providing race, gender, and ethnicity information are
outweighed by the benefits of requiring the reporting of such
information.
53. RUFRNs are Necessary to Uniquely Identify NCE Attributable
Interest Holders. The Sixth Diversity Further Notice, 78 FR 2925, Jan.
15, 2013, FCC 12-166, rel. Jan 3, 2013, tentatively concluded that
obtaining and reporting a CORES FRN for individuals identified on Form
323-E is not burdensome and sought comment. Similarly, in the Seventh
Diversity Further Notice, 80 FR 10442, Feb. 26, 2015, FCC 15-19, rel.
Feb. 12, 2015, the Commission proposed to permit an individual listed
on Form 323-E to obtain and provide an RUFRN, in lieu of a CORES FRN,
for use on broadcast ownership filings if the Commission modifies the
Form 323-E requirements as described in the Fourth Diversity Further
Notice, 74 FR 25205, May 27, 2009, FCC 09-33, rel. May 5, 2009. The
Commission has reviewed the record with respect to these issues and
concludes that extending the RUFRN requirement to Form 323-E is
necessary to help ensure the reliability of the broadcast ownership
data the Commission collects. By this Report and Order, the Commission
will require attributable entities to obtain and report a CORES FRN on
Form 323-E, as proposed in the Sixth Diversity Further Notice. While
this Report and Order discusses the availability of the RUFRN to
attributable individuals, it does not preclude individuals from
reporting a CORES FRN or SUFRN provided it is done so in accordance
with the restrictions outlined herein.
54. While some commenters support the Commission's conclusion that
RUFRNs are essential to allow analysis of the data, other commenters
dispute that position. For instance, AETC et al. claim that the
Commission has failed to demonstrate why the proposed RUFRN requirement
is necessary to track broadcast ownership. Similarly, the University of
Utah and the Utah State Board of Regents et al. argue that the benefits
derived from the use of RUFRNs on Form 323-E filings ``would be
marginal, at best.'' The University of Utah and the Utah State Board of
Regents et al. assert that, in the noncommercial context, the
Commission has not identified a diversity problem that additional
reporting requirements would help to solve. Noncommercial stations are
already required to implement numerous diversity initiatives in order
to receive funding from CPB, and unlike commercial stations, NCEs are
also subject to political pressures to promote diversity, state the
University of Utah and the Utah State Board of Regents et al. Diversity
is also identified as an explicit goal in the governing documents of
many NCE broadcast licensees, the commenters assert. Further, the
University of Utah and the Utah State Board of Regents et al. argue,
even if the new reporting requirements enable the Commission to
identify a diversity problem, it is unclear what remedial measures the
Commission could take in the noncommercial context. Any remedial
measures would presumably rely on market-based incentives to lower the
economic or regulatory cost of ownership, which would be irrelevant to
NCEs given that board membership is not determined by the cost of
investment in broadcast properties or prospective financial gain from
broadcast station ownership, state the University of Utah and the Utah
State Board of Regents et al. According to the Public Broadcast
Licensees, the ability to cross reference based on a unique identifier
``has little or no relevance to the NCE industry,'' where the existence
of multiple broadcast interests is ``quite rare'' in the case of NCE
board members and directors. Similarly, Public Broadcast Licensees
assert that the proposal to eliminate a filer's obligation to disclose
other attributable broadcast interests of attributable parties listed
in the filing has ``little or no relevance'' to NCE stations, because
unlike commercial stations, ``where individuals often have multiple
commercial broadcast interests, the existence of such interests is in
fact quite rare in the case of NCE board members and officers.''
55. The Commission disagrees. The Commission believes a unique
identifier for each individual attributable interest holder is
necessary to make the NCE data aggregable, machine readable, and
searchable in the same manner as commercial broadcast station
information. As the GAO recognized, to
[[Page 19445]]
fully understand and analyze the ownership of broadcast stations, NCE
stations must be included in the ownership data the Commission
collects. As described above, the Commission's experience with the
commercial biennial ownership reports from 2009, 2011, and 2013
revealed that use of SUFRNs is not workable to create data reliability
and the record of this proceeding offers no reason to believe that use
of SUFRNs in broadcast ownership reports for NCE stations would likely
be any more successful. The presence of the RUFRN on the reports for
noncommercial stations will allow the tracking of ownership trends over
time and allow the Commission to determine with certainty the presence
of multiple broadcast interests.
56. Obtaining an RUFRN is Not Burdensome in the NCE Context.
Several commenters argue that the CORES FRN and RUFRN requirements
would be unduly burdensome and would discourage people from serving on
the boards of NCE stations. Parties also state that licensees may have
difficulty obtaining the necessary information from board members, some
of whom are appointed governmental officials. The Commission finds that
the process for obtaining a CORES FRN or RUFRN is quite simple and will
only need to be done once. While the Commission recognizes that the
first time they file the new Form 323-E, NCE filers may require
additional time and effort to coordinate with attributable interest
holders, the Commission finds that the lead time between now and the
2017 filing window should be sufficient. The Commission is not
persuaded that the requirement will significantly inhibit individuals
from serving on the boards of NCEs. The Commission notes that the
individuals at issue are already attributable interest holders in NCE
stations and they are already identified as such on Form 323-E. With
respect to obtaining an FRN, each attributable interest holder has the
option of obtaining either a CORES FRN, requiring the submission of an
SSN to the Commission, or an RUFRN, requiring the submission of other
limited personal information, including only the last four digits of
the SSN. The attributable individual need not share any of the
personally identifying information with anyone other than the
Commission; he or she may obtain the FRN number directly from the
Commission and provide only the FRN to the licensee and the public. The
Commission will house the personal information confidentially and
securely. Under such circumstances the Commission does not believe the
FRN requirement would serve as a serious disincentive to participation
in NCE stations. SUFRNs will be available for use on Form 323-E in the
limited circumstances described below.
C. Limited Availability of SUFRNs
57. In the Seventh Diversity Further Notice, 80 FR 10442, Feb. 26,
2015, FCC 15-19, rel. Feb. 12, 2015, the Commission sought comment on
whether the SUFRN should continue to be available to filers of
broadcast ownership reports in the event that after a filer has used
reasonable and good-faith efforts, reportable individuals are unwilling
to provide their identifying information or unwilling to obtain and
provide a CORES FRN or RUFRN themselves. The Commission also asked
whether filers should be required to take specific steps to
substantiate that they have used reasonable and good-faith efforts,
including informing reportable interest holders of their obligations
and the risk of enforcement action if they fail to provide an RUFRN,
CORES FRN, or identifying information sufficient to permit an RUFRN or
CORES FRN to be obtained on their behalf. Some commenters urge the
Commission to discontinue the use of interim SUFRNs entirely and to use
its enforcement authority against anyone not willing to comply with the
ownership reporting obligations. According to UCC et al., the
Commission's use of its enforcement authority should include license
revocations. In addition, UCC et al. claim that some broadcasters
``simply do not file Form 323 at all, contrary to Bureau
instructions,'' and urge the Commission to ``fix this problem.'' Other
commenters generally support the proposal to retain the SUFRN but argue
that the Commission should not use its enforcement authority or require
filers to substantiate their reasonable good-faith efforts to comply
with the ownership reporting requirements. John Q states that the
Commission should allow continued use of SUFRNs but limit each person
to one SUFRN and store all SUFRNs within CORES.
58. The Commission confirms that SUFRNs will remain available for
the limited purpose of protecting the position of filers in the case of
interest holders that refuse to obtain an FRN or provide the licensee
with the information necessary to generate an FRN for the interest
holder. The Commission expects that, where an individual interest
holder does not already have a CORES FRN, filers will acquire an RUFRN
or CORES FRN for such individuals after obtaining the requisite
identifying information, or will instruct the individual to obtain his
or her own RUFRN or CORES FRN and to provide the FRN to the filer for
reporting on the biennial ownership report form. As previously noted,
the RUFRN method will avoid the need for individuals to disclose their
full SSNs to the Commission. In order for the Commission's RUFRN system
to be effective, the Commission believes it is necessary to ensure that
filers are using reasonable and good-faith efforts to obtain RUFRNs
from individuals with reportable interests (or from CORES on behalf of
such individuals). Therefore, the Commission concludes that filers
should be required to take specific steps to substantiate that they are
making such efforts. The Commission finds that instructing an
individual about his or her obligations and about potential enforcement
action are specific steps that demonstrate ``reasonable and good-faith
efforts.'' No commenters proposed alternative steps that would show
that such efforts are being made. The Commission expects that filers
will inform reportable individuals of their obligations and the risk of
enforcement action for failing to provide an RUFRN or CORES FRN or to
permit an RUFRN or CORES FRN to be obtained on their behalf. An SUFRN
may be obtained only if an individual still refuses to provide a means
of reporting a valid RUFRN or CORES FRN after the filer has taken such
steps. In the event that an SUFRN is used, the Commission may take
enforcement action against the filer and/or the recalcitrant
individual. The commenters have offered no evidence in the record that
the prospect of enforcement action for failing to comply with the RUFRN
requirements adopted herein will have a chilling effect on
participation in public broadcasting. Enforcement decisions will be
made on a case-by-case basis based on the facts and circumstances of
each unique case before the Commission. However, the filer itself will
be exempt from enforcement action if the filer substantiates that it
has used reasonable and good-faith efforts as described herein.
59. The Commission directs the Media Bureau to include instructions
for Forms 323 and 323-E and post language on its Form 323 and 323-E Web
site, informing reportable interest holders of their obligation to
obtain and provide an RUFRN or CORES FRN, or to permit an RUFRN or
CORES FRN to be acquired on their behalf, and to alert interest holders
of the risk of enforcement action for the failure to provide an RUFRN
or CORES FRN or to permit an RUFRN or CORES FRN to be
[[Page 19446]]
obtained. While the burden to obtain an RUFRN or CORES FRN or to permit
the filer to acquire an RUFRN or CORES FRN falls to the interest
holder, the Commission reminds filers of their obligation to review the
biennial ownership report and affirm that, to the best of the filer's
``knowledge and belief, all statements in [the ownership report] are
true, correct, and complete.'' This language is found on the electronic
version of Forms 323 and 323-E, which are available on CDBS. As stated
above, the revised versions of these forms will be implemented in LMS.
This includes verifying that the FRN reported for an individual is
correct and that no SUFRN has been used in the absence of reasonable
and good-faith efforts to obtain an RUFRN or CORES FRN, including
informing a recalcitrant interest holder of the obligation and threat
of enforcement action. When copying or importing data from a
previously-submitted ownership report, filers must replace any SUFRNs
that appeared on the prior report with RUFRNs or CORES FRNs before
submitting the new report to the Commission, unless the reporting of
one or more of those SUFRNs remains permissible under the narrow
standard set forth in this Report and Order. The Commission notes that
the biennial nature of the filing requirement and the existence of OMB
procedural requirements prior to full implementation of these rules
suggest that the 2017 filing period will be the first filing period
implicated by the requirements described herein. This time frame
mitigates any potential burden because filers have ample time to ensure
that they have a current and correct RUFRN or CORES FRN for the
individuals and entities reported on Forms 323 and 323-E. The
Commission directs the Media Bureau to revise Forms 323 and 323-E, as
well as the pop-up boxes within CDBS, to reflect this policy change.
D. Filing Burden Reduction and Improved Data Integrity
60. To make sound legislative, regulatory, and policy
determinations, the Commission must have complete and reliable
broadcast ownership data. Both GAO and the Third Circuit have
highlighted the importance of comprehensive and reliable data. At the
same time, the Commission is mindful of the burden ownership reporting
represents for the industry. The Commission's experience with Form 323
submissions for 2009, 2011, and 2013 reveals that many filings
contained errors. Such errors undermine the Commission's ability to
electronically process ownership data and make it difficult for the
Commission and outside analysts to evaluate the data. Accordingly, the
Commission finds that certain improvements to the forms will greatly
reduce the burden on filers, significantly streamline the filing
process, and increase the quality and usability of the data submitted
to the Commission. These changes include extending the biennial filing
deadline for Forms 323 and 323-E, reducing the number of filings
required, modifying the reporting of other broadcast and daily
newspaper interests, and additional improvements described below. The
Commission believes they will greatly reduce the burden on filers and
increase the quality and usability of submitted ownership data. Section
and question references in this Report and Order refer to the current
version of the form, which is implemented in CDBS. Because the revised
version of the form will be implemented in LMS, it will be given a new
number, and its format, structure, and question identification differs
from the CDBS version of the form. Several commenters suggest that the
Commission make additional, minor modifications to its ownership report
forms and their instructions that the Commission does not discuss in
detail here. The Commission has incorporated certain of these changes
into the revised ownership report forms to the extent the Commission
found them appropriate and useful. In addition to changes to the forms
and instructions, the Commission plans to implement improvements to
CDBS, such as subform cloning features, auto-fill mechanisms, and data
saving and validation routines, that will reduce data-entry burdens,
simplify the form completion process, and prevent filers from
submitting inconsistent data.
61. Background. The Commission already has taken multiple steps to
address the quality of its broadcast ownership data, including setting
uniform ``as of'' and filing dates for biennial Form 323 filings;
expanding the biennial Form 323 filing requirement to include sole
proprietors and partnerships of natural persons, as well as LPTV and
Class A licensees; revising and clarifying the instructions to Form
323; modifying Form 323's electronic interface so that ownership data
incorporated into the database can be electronically read, searched,
aggregated, and cross referenced; building checks into Form 323 to
perform verification and review functions and to prevent the filing of
incomplete or inaccurate data; and simplifying completion of the form
by providing menu and checkbox options, as well as pre-fill
capabilities, for data entry. Actions taken in this Report and Order to
require, except in limited circumstances, individuals with an
attributable interest in a broadcast station to obtain either a CORES
FRN or an RUFRN and provide that FRN on Form 323 and Form 323-E filings
will further improve the quality of the Commission's data. In addition,
the Commission modified Form 323 in March 2013 to allow for more
precise reporting of data about the race(s) of attributable
individuals. The modified version of the form eliminates the ``Two or
More Races'' category and allows filers to select as many categories as
apply. Previously, the form provided five specific racial categories,
plus a sixth category entitled ``Two or More Races,'' and allowed
filers to choose only one category for each individual. While this
change was made in response to a directive from OMB, it improves the
Commission's ownership data by requiring parties to submit more precise
race information for multi-racial individuals.
62. Despite these efforts, many ownership reports submitted to the
Commission contained errors in 2009, 2011, and 2013. As discussed
above, the Commission's experience reviewing those submissions revealed
numerous filing mistakes that prevented accurate electronic processing
of submitted reports. In preparing the 2012 323 Report and the 2014 323
Report, Commission staff (1) required many parties to submit corrective
amendments to their biennial Form 323 filings, and (2) after reviewing
submitted filings and additional information, manually moved additional
stations with reporting errors to the proper ownership categories.
Nevertheless, the Commission was unable to account for all filing
errors. Free Press submitted various ``corrections'' to the
categorization of stations in the 2012 323 Report. Many of these
``corrections'' involved updating the information provided with the
2012 323 Report to account for subsequent events, such as station
assignments and transfers. The data collection provides a same-date
snapshot of broadcast ownership every two years and information after
October 1, 2011, is not intended to be included. Improving the accuracy
and completeness of the data set remains a Commission priority.
63. The Commission has solicited a wide variety of input concerning
potential further modifications to Form 323 and Form 323-E, including
changes designed to decrease filing burdens and reduce errors in
ownership filings. For
[[Page 19447]]
example, the Fourth Diversity Further Notice, 74 FR 25205, May 27,
2009, FCC 09-33, rel. May 5, 2009, asked whether modifications made in
the 323 Order with respect to Form 323 should also be applied to Form
323-E and sought input concerning additional measures to improve data
quality, including improvements to the computer interface, additional
data-verification measures, and steps to ensure that data can be
electronically searched, aggregated, and cross referenced. In the
Review of Media Data Practices proceeding, the Commission solicited
public input to improve Form 323 and Form 323-E, including specifically
seeking burden-reducing measures and methods to improve public access
to ownership data. The Commission also asked for public comment
concerning the data contained in the 2012 323 Report and potential
actions to improve the quality of that data. The Sixth Diversity
Further Notice, 78 FR 2925, Jan. 15, 2013, FCC 12-166, rel. Jan. 3,
2013, solicited additional comment on specific proposed modifications
to the Commission's ownership report forms as suggested in comments
submitted in the Review of Media Data Practices proceeding.
64. The Commission has received extensive public input as a result
of these requests. NAB in particular identifies burdens that complicate
the ownership report filing process for both Form 323 and Form 323-E.
As the Commission noted in the 2012 323 Report, the complexity of the
ownership report form was a factor that led parties to submit
incomplete and/or inaccurate ownership information. The Commission
therefore agrees that burdens associated with preparing and submitting
biennial ownership reports have a negative impact on the quality of the
Commission's ownership data and believes that reducing the amount of
time and resources required to address the mechanical aspects of the
ownership report preparation and filing process will allow parties to
spend more time focused on the accuracy and completeness of the
ownership information they submit to the Commission. The Commission
believes that modifying the filing deadline, reducing the number of
filings required, and modifying the reporting of other broadcast and
daily newspaper interests will improve data quality while alleviating
filing burdens. The Commission believes the measures discussed here
reduce the number of required filings and burdens on filers and
increase the data quality, integrity, and usability. The Commission
declines to adopt other suggestions from commenters as follows: (1)
Overhaul the ownership reporting regime to require each licensee to
disclose its entire ownership structure, including the race, gender,
and ethnicity of all attributable interest holders, on a single filing.
The proposal lacks specificity and would not produce a data set that is
comparable to data collected in 2009 and 2011. (2) Create cross-
references between reports and allow parties to certify that no changes
have occurred since the previous biennial filing date or submit
abbreviated reports addressing only such changes, instead of filing
complete reports on each biennial deadline. These changes are
unnecessary, or of limited utility, because CDBS already allows users
to create new ownership reports that contain the data from prior
ownership filings quickly and easily. For example, while a filer cannot
simply certify that there have been no changes since the last biennial
report, that filer can, with little effort, use the ``Validation and
Resubmission of a previously filed Biennial Report (certifying no
change from previous Report)'' option within CDBS to copy and re-file a
station's previous biennial Form 323. CDBS also permits users to copy
the prior biennial report and then make edits that reflect changes. (3)
Permit parties to submit filings on paper or via alternative methods;
allowing filers to enter ownership information into text boxes instead
of requiring filers to provide data in a manner that allows it to be
written into the appropriate database fields in the CDBS ownership data
tables; and allowing parties to upload exhibits instead of entering
ownership information directly into the electronic form. These
suggestions run counter to the Commission's intention to ensure, to the
maximum extent possible, that ownership data is included in machine-
readable data fields and can be electronically searched, aggregated,
and cross referenced.
65. Modification of Filing Dates. Currently, Form 323 must be filed
by November 1 of odd-numbered years and reflect ownership information
that is accurate as of October 1 of that filing year. In the Sixth
Diversity Further Notice, 78 FR 2925, Jan. 15, 2013, FCC 12-166, rel.
Jan. 3, 2013, the Commission sought comment on its proposal to move the
due date from November 1 to December 1, with the October 1 ``as of''
date to remain unchanged. NAB supports such an extension, and no
commenters oppose providing filers with additional time for completing
and submitting ownership reports. The Commission continues to believe
that providing filers an additional 30 days will lead to more accurate
reporting of ownership information without any significant delay in the
collection and analysis of the data. The Commission makes that change.
66. The Commission declines to adopt proposals for different filing
deadlines. While some commenters argue that a December 1 deadline is
inconvenient for filers and Commission staff due to the date's
proximity to the Thanksgiving holiday and other Commission filing
deadlines, those commenters fail to suggest an alternative date.
Further, the Commission finds that the 60-day period between the ``as
of'' date and the filing date should provide sufficient flexibility for
filers such that other deadlines or holidays do not complicate
compliance. Filers can file any time from October 1 through December 1.
MMTC asks that the Commission impose an annual, rather than biennial,
ownership reporting obligation. At this time, the Commission believes
that any marginal benefit of having an annual rather than a biennial
snapshot of ownership data is outweighed by the additional burden such
a requirement would place on licensees to undertake the full reporting
obligation twice as often.
67. The Fourth Diversity Further Notice, 74 FR 25205, May 27, 2009,
FCC 09-33, rel. May 5, 2009, asked whether the Commission should adopt
uniform filing and ``as of'' dates for Form 323-E. The Commission will
require NCE filers to submit Form 323-E in accordance with the same
``as of'' date and filing deadline applicable to commercial
broadcasters (i.e., their filings will be due on December 1 of odd-
numbered years and the ownership information provided should be current
as of October 1 of the filing year). Currently, NCE stations submit
biennial Form 323-E in accordance with a set of rolling deadlines. Each
NCE station's biennial deadline is keyed to the anniversary of the date
on which its license renewal application is required to be filed. The
information contained on each report must be current as of no more than
60 days prior to the filing of that report. At least one commenter
argues that these current deadlines should remain in place. When
adopting uniform filing and ``as of'' dates for Form 323, the
Commission noted that, as a result of the prior, rolling deadlines,
``new data are continually incorporated into the database as it is
filed, mixing new data and old data . . . [which] has impeded the
ability to perform time-related comparisons using our
[[Page 19448]]
database.'' Thus, in order to ``[t]o make the data easier to work with,
to address the problems created by the staggered ownership report
filing deadlines currently in effect, and to facilitate studies of
ownership,'' the Commission required all biennial Form 323 filers to
submit reports by November 1, with data current as of October 1. The
same reasoning applies equally to Form 323-E and convinces the
Commission to require NCE stations to file according to the same
schedule.
68. Some commenters suggest that, to reduce the burden on NCE
broadcasters and their counsel, any uniform filing date for Form 323-E
should be in the first quarter, to correspond to a date that certain
NCE stations submit similar data to CPB. This suggestion would not
allow the Commission to obtain the synchronized data needed to evaluate
minority and female participation in broadcasting over all the services
over time. Moreover, since not all NCE stations submit data to CPB,
efforts by the Commission to coordinate with CPB would not fully
address the filing deadline issue.
69. Reduction in the Number of Required Filings. The current
version of Form 323 allows parent entity filers to list only one
subsidiary licensee and its associated stations. As a result, parent
entities with multiple licensee subsidiaries must file separate
ownership reports for each of those licensees. In most cases, these
reports are virtually identical to each other except for the details
concerning the licensee and station(s) involved. The number of separate
filings that a broadcaster must file under the current version of Form
323 depends on the characteristics of that licensee's ownership
structure, including the number of licensees and parent entities and
the relationships that those entities have to each other. In order to
reduce the number of filings submitted to the Commission, NAB suggests
that the Commission modify Form 323 to allow parents with several
wholly owned licensee subsidiaries to list all of those licensees and
their associated stations on a single report. In the Sixth Diversity
Further Notice, 78 FR 2925, Jan. 15, 2013, FCC 12-166, rel. Jan. 3,
2013, the Commission solicited comment on this proposal and asked
whether it should be expanded to allow parent entities to file
consolidated reports for all of their licensee subsidiaries, regardless
of whether or not those subsidiaries are wholly owned. No commenters
oppose these proposals, and NAB indicates that it approved of the
Commission's expanded version.
70. The Commission believes that modifying Form 323 to allow a
parent entity with multiple licensee subsidiaries to file one report
that covers all of those licensees will greatly reduce the burden on
many filers with no negative impact on the quality of the Commission's
ownership data. In some cases, an entity is both a licensee and the
parent of one or more licensees. Such an entity must file two separate
reports--one as a licensee and one as a parent company. The Commission
therefore makes the following three changes to Form 323: (1) The
Commission modifies the form to allow parent filers to list multiple
subsidiary licensees and the stations associated with those licensees,
(2) the Commission deletes the portion of section II-A, question 3(a)
(non-biennial), and section II-B, question 3(a) (biennial), asking
filers to identify the relationship that each reportable individual or
entity has to the licensee, and (3) the Commission deletes section II-
B, question 4 (biennial), asking each parent filer to identify the
entity or entities directly below it in the licensee's ownership chain.
The revised version of Form 323-E is consistent with these
modifications as well. The Commission makes the second change to allow
a parent entity to file a consolidated ownership report even if an
individual listed in response to question 3(a) on the parent's report
does not have the same direct interests in all of the parent's licensee
subsidiaries. For example, an individual might hold officer positions
in the parent and its radio licensee subsidiaries, but not in the
parent's television licensee subsidiaries. Because the responses to
question 3(a) on the report for each licensee include information
concerning the relationship between each attributable party and that
licensee, this modification will have no impact on the completeness of
the Commission's ownership data. The third change will ensure that a
parent entity can file a consolidated report in situations where it
holds interests in some of its licensee subsidiaries directly and some
indirectly and/or it holds its various subsidiary licensees through
different intermediate entities. The Commission added section II-B,
question 4 (biennial), to the revised version of Form 323 in an effort
to improve the ability of researchers and others to cross reference
ownership report data and construct complete ownership structures.
Experience has demonstrated, however, that information provided in
response to section II-A, question 3(a) (non-biennial), and section II-
B, question 3(a) (biennial), is sufficient for these purposes.
71. Improvements to Reporting of Other Broadcast and Daily
Newspaper Interests. In the Review of Media Data Practices proceeding,
NAB requested that the Commission eliminate section II-B, question
3(c), of Form 323, which requires a filer to disclose the other
attributable newspaper and broadcast interests of attributable parties
listed in response to section II-B, question 3(a). The Commission's
revised Form 323-E, like the current version of the form, requires
disclosure of other broadcast interests, but does not require
disclosure of other daily newspaper interests. NAB argues that
submission of this data is particularly burdensome, requiring
significant amounts of data entry and file uploading via a series of
subforms or spreadsheet attachment(s). The Commission sought comment on
NAB's proposal in the Sixth Diversity Further Notice, 78 FR 2925, Jan.
15, 2013, FCC 12-166, rel. Jan. 3, 2013. NAB reiterates its support,
and no commenters oppose the proposal.
72. As discussed in more detail below, the Commission declines to
eliminate section II-B, question 3(c), entirely. Nevertheless, the
Commission believes that modifications to the reporting requirements
for other attributable broadcast and daily newspaper interests will
reduce filing burdens and improve both the quality and the usability of
the Commission's ownership data. Specifically, the Commission takes the
following actions with respect to the reporting of other broadcast
interests on Form 323: (1) The Commission deletes the broadcast
interests portion section II-B, question 3(c); (2) the Commission adds
simple yes/no buttons to the relevant subforms; and (3) the Commission
modifies the public search capabilities of its electronic filing system
to allow users to search ownership report filings by FRN and output the
results as either a list of reports or a list of stations. Several
commenters requested that the Commission add search capabilities of
this type. Taken together, these three changes will simplify reporting
and allow interested parties to determine the other broadcast interests
held by reported individuals and entities, if any, in a straightforward
manner.
73. Two factors make these changes possible. First, the
Commission's implementation of the RUFRN requirement will make the FRN
information in the Commission's ownership database more useful as a
means to cross reference information across multiple filings. Second,
[[Page 19449]]
information concerning the other attributable broadcast interests of a
party listed on one biennial ownership report is contained in one or
more other biennial ownership reports (i.e., report(s) filed in
connection with that party's other attributable stations). As a result
of these two factors, parties that use the additional FRN-based search
capabilities the Commission adds to its electronic filing system, as
well as parties that download the Commission's ownership data and work
with it directly, can create lists of broadcast interests associated
with particular entities and individuals easily and reliably, rendering
the XML spreadsheets previously required for the broadcast portion of
question 3(c) unnecessary.
74. Section II-B, question 3(c), in the biennial section of Form
323 also requires the respondent to provide information concerning the
attributable daily newspaper interests held by parties that hold
attributable interests in the respondent. The Commission will not
delete this portion of the question. Unlike information about broadcast
interests, information concerning daily newspaper interests does not
appear anywhere on Form 323 except in responses to question 3(c). In
other words, an interest holder's daily newspaper interests cannot be
ascertained except in direct response to this question. The Commission
therefore cannot remove the newspaper interests portion of section II-
B, question 3(c), without sacrificing the quality and completeness of
the Commission's data. The Commission notes that, because reported
newspaper interests generally are significantly fewer than the
broadcast interests implicated in the first part of the question,
eliminating the daily newspaper inquiry would be of limited value in
reducing filing burdens. Moreover, the Commission believes that a
slight modification to this question will improve the quality of the
Commission's Form 323 data collection and enhance the ability of
parties to search, aggregate, and cross reference the Commission's
broadcast ownership data. Specifically, the Commission modifies the
relevant subforms and attachments to require filers to provide an FRN
for each person and entity listed. Any FRN reported in response to
question 3(c) is already required in response to question 3(a).
Accordingly, this modification to question 3(c) does not mandate the
submission of any additional information or require any person or
entity to obtain an RUFRN or CORES FRN that is not already required to
do so.
75. Finally, the reasoning in support of the modifications to the
reporting of broadcast interests discussed above applies equally well
to both the biennial and the non-biennial sections of Form 323, as well
as to Form 323-E. Accordingly, the Commission applies these changes to
both sections of Form 323, and includes parallel modifications to both
sections of the revised version of Form 323-E. Moreover, the Commission
applies its modifications to the reporting of newspaper interests to
both the biennial and non-biennial sections of Form 323, because they
share a common underlying rationale. The Commission believes these
changes will further reduce filing burdens and improve the quality of
its ownership data. As part of making these modifications, the
Commission will eliminate the relevant inconsistencies between the
forms and the instructions noted by NAB in the Review of Media Bureau
Data Practices proceeding.
76. Addition of Tribal Nation/Entity Designation. In the Review of
Media Bureau Data Practices proceeding, the Bureau asked, among other
things, whether it should collect additional data and for what
purpose(s) and how the Bureau's data collections could be improved. In
addition, the Fourth Diversity Further Notice sought comment concerning
what data would meaningfully expand the Commission's understanding of
minority and female ownership, including information to determine if
NCE stations are serving underserved audiences. In response to the
Fourth Diversity Further Notice, 74 FR 25205, May 27, 2009, FCC 09-33,
rel. May 5, 2009, two commenters suggest that the Commission include a
designation within Form 323-E to allow parties to identify Tribal
entities. No parties oppose this request.
77. The Commission agrees that collecting information on a biennial
basis concerning participation of Tribal Nations and Tribal entities in
broadcasting will help the Commission evaluate service to underserved
and minority populations. Moreover, such data will help inform the
Commission's ongoing efforts to expand broadcast opportunities for
Tribal Nations and Tribal entities, as developed in the Commission's
Rural Radio proceeding. The Tribal Priority adopted in the Rural Radio
proceeding benefits federally recognized American Indian Tribes and
Alaska Native Villages, or Tribal consortia, and entities majority
owned or controlled by such Tribes, proposing service to Tribal lands
(or the equivalent thereto). Because these efforts involve both
commercial and noncommercial broadcasting, and in light of the
Commission's ongoing efforts to improve its broadcast ownership data
collections, the Commission believes that the rationale for adding a
Tribal Nation/entity designation to Form 323-E applies equally to Form
323. In addition, collection of this information on a biennial basis
will be minimally burdensome, and any increased burden is outweighed by
the significant burden-reducing measures adopted elsewhere in this
Report and Order. Accordingly, the revised versions of both Form 323
and Form 323-E allow (but do not require) filers to indicate whether or
not licensees and/or attributable entities are Tribal Nations or Tribal
entities. For purposes of the Tribal Priority in the Rural Radio
proceeding, the Commission defined a Tribe as any Indian or Alaska
Native Tribe, band, nation, pueblo, village or community which is
acknowledged by the Federal government to constitute a government-to-
government relationship with the United States and eligible for the
programs and services established by the United States for Indians. The
Commission uses the same definition for purposes of implementing the
Commission's Tribal Nation/entity designation. The criteria used by the
Commission to award a Tribal Priority in the licensing context rely on
this definition, but include additional factors as well.
78. Improved Data Practices. As noted above, the Commission noticed
its intent to improve the Form 323 and 323-E data collections and
sought comment on improvements and burden-reducing measures in the
Review of Media Data Practices proceeding. The Commission also asked
for public comment concerning the data contained in the 2012 323 Report
and potential actions to improve the quality of that data. In
furtherance of these ongoing efforts to improve data quality, reduce
filing burdens, and improve public access to ownership data, the
Commission makes minor changes to its ownership report forms. These
include: (1) Clarifying reporting of 47 CFR 73.3613 documents on Form
323 and Form 323-E, (2) adding a category to Form 323 for Limited
Liability Companies, (3) eliminating the capitalization question from
Form 323, and (4) adding a designation to Form 323 for jointly held
interests. The Commission also makes modifications to the instructions
for the form(s) consistent with these changes. The Commission did not
receive positive or negative comments concerning the changes described
below, except as indicated.
[[Page 19450]]
79. First, the Commission reduces burdens and improves both the
quality and usability of the Commission's ownership data by clarifying
the manner in which filers should report contracts and other
instruments that must be filed pursuant to section 73.3613 of the
Commission's rules. As part of this clarification, the Commission will
eliminate the relevant inconsistencies between the forms and the
instructions noted by NAB in the Review of Media Bureau Data Practices
proceeding. Form 323, section II-A, question 1 (non-biennial), and
section II-B, question 1 (biennial), requires commercial full-power
television stations, AM radio stations, and FM radio stations to list
all 73.3613 documents. The relevant requirement applies to full-power
television stations, AM radio stations, and FM radio stations. The
requirement does not apply to Class A television or LPTV stations.
Accordingly, licensee entities that only hold licenses for Class A
television and/or LPTV stations should answer ``N/A'' to this question.
The Commission updates Forms 323 and 323-E and the instructions for
both forms to make this clear. Form 323-E, section II, question 5,
imposes the same obligation on NCE filers. The respondent on a given
report may or may not be a party to these contracts and instruments.
For example, certain credit agreements may include one or more of the
licensee's parent entities as parties, but not the licensee. Similarly,
network affiliations often include some, but not all, of the entities
in a station's ownership structure as parties. Some filers list all
relevant documents on the licensee's ownership report, while other
filers opt to list different documents on different reports (perhaps
based on whether or not the respondent is a party to the document). The
latter approach requires filers to include different, often
overlapping, lists of documents on multiple reports and forces
researchers and other parties to examine all of a station's ownership
filings to construct a complete list of that station's required
contracts and instruments.
80. To address these issues, the Commission modifies the relevant
questions on Form 323 and Form 323-E to require all section 73.3613
documents for a station to be listed on the report for that station's
licensee. Under the Commission's rules, a full-power television
station, Class A television station, AM radio station, or FM radio
station must have an up-to-date list of all section 73.3613 documents,
or copies of all such documents, in its public file at all times.
Accordingly, licensee entities are often in the best position to
produce the information necessary to respond to this question. It is
therefore sensible to require licensees' filings to include a complete
document list. This clarification will reduce filing burdens, because
filers will be able to enter all required information on the licensee
report and simply check ``N/A'' for all parent filings. Moreover, to
the extent that filers may have been providing different document lists
on various reports for the same parent entity, this modification helps
ensure that parent entities can file consolidated reports for all of
their subsidiary licensees. This clarification also will improve public
access to and use of the Commission's ownership data, because parties
reviewing ownership reports will need to examine only one of a
station's filings to construct a full list of that station's section
73.3613 documents. As a result of this clarification, the section
73.3613 documents question mirrors section II-B, question 5, which
directs parties to provide an ownership chart (or similar information)
on the licensee's ownership report and to check ``N/A'' on all parent
filings. To further improve public review and use of the Commission's
ownership data, the ownership report search results screen in LMS will
indicate, for each report listed, whether that report was submitted for
a licensee/permittee or a parent entity. This will help users quickly
identify the filings that contain summary contracts and ownership
structure information.
81. Second, the Commission improves data quality by adding a
category to Form 323 for limited liability companies. Section I,
question 8, of Form 323 requires the filer to identify the nature of
the respondent, and currently allows the filer to choose between
categories for sole proprietorships, for-profit corporations, not-for-
profit corporations, general partnerships, and limited partnerships.
Respondents that do not fit into one of these categories must select
the ``other'' category and provide an explanatory exhibit. The parallel
question on the revised version of Form 323-E includes different
categories. Accordingly, the modification the Commission makes here
applies only to Form 323. Over the years, limited liability companies
have become increasingly common in the ownership structures of
commercial broadcast stations. The Commission believes it is prudent to
add a separate category allowing parties to identify filing entities
that are limited liability companies. The ``other'' option will remain
on the form, along with the ability to upload an exhibit, for
respondents that do not fit into one of the provided categories. Adding
this category will reduce burdens on limited liability company filers
by eliminating the need to type an exhibit. It will also improve the
Commission's data by placing more ownership information into machine-
readable data fields and, thereby, improving the ability of parties to
electronically search, aggregate, and cross reference the Commission's
ownership data.
82. Third, the Commission reduces burdens by eliminating Form 323,
section II-A, question 2 (non-biennial), and section II-B, question 2
(biennial), which requires filers to provide capitalization information
for any respondent that is a licensee, permittee, or entity that has a
majority interest in, or otherwise exercises de facto control over the
licensee. Neither the current nor revised version of Form 323-E
contains this question. The Commission can eliminate the question
without meaningfully compromising data quality because section II-A,
question 3(a) (non-biennial), and section II-B, question 3(a)
(biennial), better address the Commission's need to ascertain equity
ownership of, and voting rights in, the respondent than does question
2. Section II-B, question 3(a) (biennial), requires information
concerning both voting and equity rights in the respondent, while
section II-A, question 3(a) (non-biennial), only requires information
concerning voting rights in the respondent. There are at least two
reasons that the information provided in response to question 3(a) is
more useful than the information provided in response to question 2.
First, because question 2 only applies to entities that issue stock
(i.e., corporations), many filers (such as partnerships and limited
liability companies) do not have to provide any information.
Accordingly, there currently are large gaps in the question 2 data
collected by the Commission. Question 3(a), on the other hand, applies
to all filers. Second, question 2 does not solicit information
concerning share equity values for the various classes of stock or the
relative voting rights of different classes of voting stock. As a
result, information provided in response to question 2, unlike
information from question 3(a), generally is insufficient for
understanding the voting or equity structures of the respondent.
Moreover, eliminating the capitalization question will reduce filing
burdens on corporate filers.
83. Fourth, in addition to the Commission's general desire to
improve the quality of its broadcast ownership
[[Page 19451]]
data collections, the Commission's 2012 323 Report PN evidenced a
desire to implement practical changes to Form 323 that would reduce
data errors and make the Commission's ownership data more complete and
usable. In furtherance of these objectives, the Commission adds a yes/
no question to the subforms identifying attributable parties to allow
parties to identify jointly held voting interests.
84. In certain circumstances, two or more parties hold a voting
interest in a licensee or other respondent jointly. Two parties may,
for example, hold 100 percent of the voting interest in an entity
together, as joint tenants (as opposed to each individual holding 50
percent of the voting interests). Similarly, agreements for
partnerships or limited liability companies may provide that two or
more individuals exercise voting power together, such that any of the
relevant parties can fully exercise the voting interest. Because the
current version of Form 323 provides no mechanism for parties to
identify situations in which voting interests are jointly held, it is
likely that filers report such interests in different ways, which leads
to errors and inconsistencies in the Commission's data. For example,
faced with a situation in which parties A and B hold a 50 percent
voting interest jointly, one filer might report both as having a 50
percent interest while another filer might report A and B as holding 25
percent of the voting interests each. Neither of these options
accurately captures the voting rights at issue. When preparing the 2012
323 Report, the Commission found that its inability to identify and
interpret jointly held voting interests on ownership reports rendered
it impossible for Commission staff to electronically or manually
process those reports. Parties reviewing non-biennial Form 323 filings
will face similar difficulties. Accordingly, the Commission finds that
adding a question to both the biennial and non-biennial sections of
Form 323 to address this issue is a minimally burdensome way to improve
the quality of the Commission's ownership data. The Commission does not
believe that there are many jointly held voting interests in the NCE
context. Accordingly, the Commission does not make a similar
modification to Form 323-E at this time.
85. Finally, the subforms for Form 323 section II-A, question 3(a)
(nonbiennial) and section II-B, question 3(a) (biennial) provide
categories for filers to identify each attributable party's positional
interest in the respondent. To increase the usability of the
Commission's ownership data, and in light of the Commission's recent
decision concerning attribution of television joint sales agreements
(JSAs), the Commission will add a new positional interest category that
will allow filers to identify reported parties that are attributable by
virtue of a JSA or Local Marketing Agreement. One commenter proposes
additional reporting requirements for parties that operate a station
pursuant to a local marketing agreement (LMA). As an initial matter,
the Commission notes that any party that has an attributable interest
in a commercial broadcast station by virtue of an attributable LMA or
JSA is already required to comply with Form 323 filing requirements for
that station. This existing requirement captures any minority and
female ownership interests in commercial broadcast stations that result
from the operation of a station pursuant to an attributable agreement.
The Commission declines to extend the reporting requirement to
nonattributable operating agreements because there is no information on
the current record that reflects that a data collection focused on this
category of nonattributable interest holders would meaningfully improve
the data set.
E. Other Proposals
86. Commenters in this proceeding provide several additional
suggestions relating to Form 323, Form 323-E, procedures related to
those forms, and the Commission's Consolidated Database System (CDBS)
that the Commission declines to implement at this time. The Commission
discusses those proposals briefly below. As noted above, the Commission
intends to move Forms 323 and 323-E from CDBS to LMS. Comments and
arguments presented herein with respect to CDBS are equally applicable
to the Commission's future LMS implementation of the forms and the
associated public search capabilities. Additional rejected proposals
are addressed elsewhere in this Report and Order and that discussion is
not repeated in this section.
87. MMTC asks the Commission to create a separate filing category
for transfers to bankruptcy trustees, debtors-in-possession, or trusts,
arguing that this would help identify business failures. The Commission
declines to do so, because the suggestion is outside the scope of this
proceeding, would be burdensome and costly, and similar information is
available already. Creating a new filing category would require changes
to Form 323 and Form 323-E, the associated database elements in CDBS,
and also changes to the Commission's forms for assignments and
transfers of broadcast authorizations, the database infrastructure
associated with those forms, and the Public Access portion of CDBS. The
record does not demonstrate sufficient utility of the information to
justify these costly undertakings. In any event, parties can use the
public access portion of CDBS to obtain information concerning
individual transactions, including those that involve assignments or
transfers to bankruptcy trustees, debtors-in-possession, or trusts. The
Public Access portion of CDBS allows users to search for assignment and
transfer applications based on multiple criteria, including call sign,
Facility ID Number, service, station location (city and state),
application file number, and applications status. This electronic
system also gives users access to the full content of each assignment
and transfer application, including the portions that describe the
parties to the application and the nature of the underlying
transaction(s), and provides information about legal actions pertaining
to those applications. The Commission intends to implement these
functions in LMS as well.
88. Several commenters ask the Commission to modify its electronic
filing systems, the Public Access portion of CDBS, or the online
instructions for CDBS. For example, parties ask the Commission to
create new filing systems for parties with limited broadband access
and/or update CDBS accounts to recognize the type of entity, list only
reports applicable to that entity, indicate previous filings and dates,
allow users to pre-populate entries in new reports based on prior
reports (including forms of different types), and provide automated
filing reminders. Several of these capabilities already exist in CDBS.
For example, if a party uses the same CDBS account for all of its
filings, that account already contains the station's prior filings as
well as information about those filings, including submission dates.
CDBS in many cases allows users to pre-populate new ownership reports
by copying or prefilling data from another filing of the same type.
CDBS pre-populates data in some other situations as well. For example,
when a party launches a covering license application in CDBS, the
system often pre-populates some information from the related permit
application. Similarly, CDBS uses information in the Account
Maintenance menu to prefill respondent, applicant, and contact
representative information into applications. The Commission intends to
implement similar functions in LMS
[[Page 19452]]
as well. To utilize these and other burden-reducing capabilities in
CDBS, filers sometimes use different CDBS accounts for different types
of filings and different entities. The Commission does not want filers
to lose the ability to benefit from that practice. The remaining
suggestions are either technically infeasible or impose significant
costs on the Commission that appear to exceed any possible benefits at
this time. Other commenters suggest various enhancements to search
capabilities within the Public Access portion of CDBS, including
searching ownership reports by gender, race, ethnicity, voting
percentage, and equity percentage; displaying explanatory messages when
searches produce no results; and alerting searchers about assignment
and/or transfer applications. Broadband Institute of California also
requests that the Commission allow users to search ownership reports by
station call sign. The Public Access portion of CDBS already provides
the ability to do so. It should be noted, however, that because station
Facility ID Numbers, unlike station call signs, are permanent, Facility
ID Number searches provide more reliable results than call sign
searches. Researchers and other parties currently can download the data
files from the Commission's Web site at any time and study, search, and
manipulate the data in a wide variety of ways. This suggests that
developing an extensive catalog of complex query options within the
public search functionality of the Commission's electronic filing
system would impose unnecessary costs on the Commission. UCC et al.
argue that the form in which the Commission makes its broadcast
ownership data available to the public renders the data incapable of
being searched, aggregated, and cross referenced electronically. This
is incorrect. The Commission has ensured that the data submitted on
Form 323 are incorporated into a relational database, the most common
database format, which is standard for large, complicated, interrelated
datasets. It is available to the public. Complete raw data from the
Commission's broadcast ownership filings, both current and historical,
are available for download via a Web page on the Commission's Web site,
and it is updated on a daily basis to account for new and amended
filings. Users can access and manipulate the data in almost limitless
ways. The Commission has also made explanatory documents publicly
available and easy to find. These steps represent extensive progress
towards the goal of making ownership data available to the public in a
form that is capable of being electronically searched, aggregated, and
cross referenced.
89. Finally, several commenters ask that the Commission not audit
ownership data submitted by NCE stations and/or that NCE entities be
subject to reduced compliance standards and/or forfeitures. The
Commission believes that in order to maintain and improve the quality
of both its commercial and noncommercial ownership data, the Commission
must have the ability to audit broadcast ownership data and hold
parties responsible for their submissions. Accordingly, the Commission
declines to make any changes to its approach to ownership report data
audits and related forfeitures at this time.
IV. Procedural Matters
A. Final Regulatory Flexibility Analysis
90. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), the Commission incorporated an Initial Regulatory
Flexibility Analysis (IRFA) of the possible significant economic impact
on a substantial number of small entities by the policies and rules
proposed in the Fourth Diversity Further Notice of Proposed Rulemaking
(Fourth Diversity Further Notice), the Sixth Diversity Further Notice
of Proposed Rulemaking (Sixth Diversity Further Notice), and the
Seventh Diversity Further Notice of Proposed Rulemaking (Seventh
Diversity Further Notice). No comments were filed addressing the IRFA
regarding the issues raised in these further notices of proposed
rulemaking. Because the Commission amended the rules in the Report and
Order, Second Report and Order, and Order on Reconsideration (Report
and Order), the Commission has included this Final Regulatory
Flexibility Analysis (FRFA). This present FRFA conforms to the RFA.
1. Need for, and Objectives of, the Report and Order
91. The Report and Order enhances the collection of data reported
on FCC Form 323, Ownership Report for Commercial Broadcast Stations,
and FCC Form 323-E, Ownership Report for Noncommercial Broadcast
Stations, to improve the data available to analyze issues relevant to
ownership and viewpoint diversity. These improvements are designed to
advance the Commission's long-standing goal of promoting diversity in
ownership of broadcast stations to ensure that diverse viewpoints and
perspectives are available to the American people in the content they
receive over the broadcast airwaves. In pursuit of this goal, the
Commission has a long history of promulgating rules and regulations
intended to foster diversity in terms of minority and female ownership.
A necessary precursor to the Commission's rulemaking efforts is the
collection of comprehensive, reliable data reflecting the race, gender,
and ethnicity of the owners and other interest holders in broadcast
stations. Such data are essential to effectively study and analyze
ownership trends, to assess the impact of Commission rules, and to
provide the foundation for the consideration of new rules, among other
things. To be useful for this purpose, to the greatest extent possible
the data must be capable of being read, verified, searched, aggregated,
and cross-referenced electronically.
92. Accordingly, pursuant to the Commission's statutory mandate
contained in section 257 of the Telecommunications Act of 1996 (the
1996 Act) and section 309(j) of the Communications Act of 1934 (the
Act) to promote opportunities for small businesses and women and
minorities in the broadcasting industry, the Commission implements a
Restricted Use FRN (RUFRN) within the Commission's Registration System
(CORES) that individuals may use solely for the purpose of broadcast
ownership report filings. The Commission believes that the RUFRN will
allow for sufficient unique identification of individuals listed on
broadcast ownership reports without necessitating the disclosure to the
Commission of individuals' full Social Security Numbers (SSNs). In
light of the adoption of the RUFRN requirement, the Commission
eliminates the availability of the Special Use FRN (SUFRN) for
broadcast station ownership reports, except in very limited
circumstances as further described herein. The Commission also
prescribes revisions to Form 323-E that conform reporting for
noncommercial broadcast stations more closely to those for commercial
stations, including information about race, gender, and ethnicity of
existing attributable interest holders; the use of a unique identifier;
and the biennial filing requirement. Finally, the Commission makes a
number of significant changes to the reporting requirements that reduce
the filing burdens on broadcasters, streamline the process, and improve
data quality. These changes include extending the biennial filing
deadline, reducing the number of filings required, improving the
reporting of other
[[Page 19453]]
broadcast and newspaper interests, and other modifications.
2. Summary of Significant Issues Raised by Public Comments in Response
to the IRFA
93. The Commission received no comments in direct response to the
IRFAs contained in the Fourth Diversity Further Notice, the Sixth
Diversity Further Notice, and the Seventh Diversity Further Notice in
this docket. However, as further discussed below, the Commission
received comments that discuss the additional burdens on broadcast
licensees, including small entities. For reasons discussed below, some
commenters oppose the adoption of the RUFRN requirement, the
elimination of the availability of the SUFRN, and the expansion of the
race, gender, and ethnicity reporting for Form 323-E.
94. The actions taken in the Report and Order advance the
Commission's commitment to improving the comprehensiveness and
reliability of the ownership data collected on Forms 323 and 323-E to
enable more effective analysis of ownership trends in support of policy
initiatives promoting diversity in ownership of broadcast stations. As
a result, the Commission will no longer allow filers to use SUFRNs on
biennial ownership reports, except in limited cases, and instead will
require that on such forms filers provide an RUFRN or CORES FRN for any
reportable individual attributable interest holder. In addition, the
Commission updates its reporting requirements for NCE stations to more
closely parallel the requirements for commercial stations. The Report
and Order also makes certain changes to the Commission's Form 323 and
323-E aimed at reducing the filing burdens on broadcasters and
improving data collections. Finally, the Commission declines to adopt
certain proposals detailed in comments in this proceeding as redundant,
unnecessary, technically infeasible, or unsupported.
95. Availability of the RUFRN. Currently, filers of Form 323
(Ownership Report for Commercial Broadcasters) must provide an FCC
Registration Number (FRN) generated via CORES for each reported
attributable party. To obtain a CORES FRN, an individual must submit
his or her SSN to the Commission through CORES. CORES FRNs therefore
can be used to uniquely identify individuals reported on Form 323,
which is crucial to the quality and utility of the Commission's
broadcast ownership data. Filers also have the option of reporting an
SUFRN for individuals, if after good-faith efforts, the filer is unable
to report a CORES FRN for that individual. As further discussed below,
the Commission finds that the existence of SUFRNs undermines the
usefulness and integrity of the Commission's broadcast ownership data,
because they are not backed by identifying information that allows the
Commission to uniquely identify an individual reported on the biennial
ownership reports.
96. In the Report and Order, the Commission notes that it is
sensitive to the concerns raised regarding a proposed requirement that
every individual interest holder of a broadcast station submit his or
her SSN to the Commission for the purpose of reporting a CORES FRN on
the broadcast ownership reports. The Commission finds that the RUFRN
(which does not require the submission of a full SSN but instead
requires submission of full name, residential address, date of birth,
and only the last four digits of the individual's SSN) will support the
Commission's data gathering and policy-making initiatives by providing
reasonable assurance that individuals reported on the broadcast
ownership reports are uniquely identified in a manner that ensures that
the data collected can be meaningfully searched, aggregated, and cross-
referenced electronically. Moreover, the use of SUFRNs on Form 323 has
compromised the integrity of the data collected and frustrated the
Commission's attempts to fulfill its statutory mandates under section
257 and section 309(j). Accordingly, the Report and Order adopts the
RUFRN for use on Form 323 by attributable individuals. An individual
requesting an RUFRN would be required to submit his or her name, date
of birth, and residential address, along with the last four digits of
his or her SSN, to CORES.
97. The identifying information provided by the individual in order
to obtain an RUFRN will be confidentially stored within CORES, and only
the individual's name and RUFRN will be available publicly. The
underlying information will be entirely machine readable and will not
require the manual consideration of each biennial ownership form to
compare associated name and address information to analyze whether Form
323 entries might identify the same individual or different
individuals. When the individual applicant obtains an RUFRN, the
applicant will be asked to list all CORES FRNs registered to the
individual and all SUFRNs that the individual previously used in any
broadcast ownership report filings since the 2009 biennial reporting
cycle. The Commission concludes that this disclosure will allow the
Commission to identify all CORES FRNs, RUFRNs, and SUFRNs that identify
the same individual, which will promote the usefulness of the broadcast
ownership data for purposes of electronic searching, aggregating and
cross-referencing, and for trend analysis. Once an RUFRN is issued, an
ownership report filing that lists the individual associated with that
RUFRN will be required to include that RUFRN. However, an individual
may opt to use a traditional CORES FRN instead of obtaining and using
an RUFRN.
98. The Commission also concludes that permitting individual
interest holders the ability to obtain and report an RUFRN in lieu of a
traditional CORES FRN will impose minimal costs and burdens, if any, on
individuals or filers. Those that already have a CORES FRN will be able
to continue to use that existing number without the need to register
for an RUFRN, and any individuals interested in obtaining a CORES FRN
will still be able to do so. Registering for an RUFRN is a one-time
process that takes a few moments to complete, and there are at most de
minimis costs or burdens associated with obtaining the RUFRN. The use
of the RUFRN as a unique identifier that can be easily cross-referenced
will also enable the Commission to make certain modifications to
broadcast ownership reporting that will reduce burdens on all filers,
as described below, and will therefore further improve the quality of
the ownership data submitted to the Commission. Although some
commenters argue that implementing the RUFRN would impose specific
burdens on NCE licensees, as discussed below, no commercial station
disputes the Commission's finding that RUFRNs will not be burdensome
for commercial entities.
99. Commenters also raise concerns about the security and integrity
of CORES and argue that registering for a CORES FRN or an RUFRN may
leave individuals vulnerable to identity theft. The Commission agreed
with commenters that privacy and security with respect to personally
identifiable information are paramount, and the Commission stated that
it is confident that the steps taken and the procedures in place assure
the security of the Commission's systems. In fact, the Commission
stated that it is not aware of any breaches to CORES. In the Seventh
Diversity Further Notice, the Commission explained that it was in the
process of implementing certain improvements before the completion of
the Information Security GAO Report, and the Commission continues today
to
[[Page 19454]]
strengthen its security environment using the recommendations included
in the Report. The CORES architecture exceeds Federal guidelines, and
the Commission's databases are behind several firewalls. Administrative
access to the CORES application is limited and all transmission of non-
public data is encrypted. Moreover, the Commission has made numerous
upgrades to its network, including implementing enhanced perimeter
controls, malware protection, and monitoring devices, and upgrading
workstations to operating systems with improved security. As a result,
the Commission's network is stronger, better, and more secure than ever
before. Security will continue to be one of the Commission's highest
priorities, and the Commission will continue to make the necessary
upgrades to ensure the security of CORES and all of its systems. In
response to the Seventh Diversity Further Notice, the National
Association of Broadcasters also commented that RUFRNs, because they
create a unique identifier without requiring individuals to submit full
SSNs to the Commission, provide a `safety valve' for individuals who
might be reluctant to obtain a CORES FRN due to data privacy concerns.
100. Modifications to Form 323-E. To enhance the completeness of
the Commission's data collection, promote data integrity, and ensure
that data are electronically readable and aggregable, the Commission
also revises Form 323-E for NCE stations to collect race, gender, and
ethnicity information for attributable interest holders, require that
CORES FRNs or RUFRNs be used, and conform the biennial filing deadline
of broadcast ownership reports for NCEs with commercial stations. The
Commission finds that it has authority under section 257 of the 1996
Act and section 309(j) of the Act to collect race, gender, and
ethnicity information from attributable interest holders in NCE
stations, and the Commission affirms the conclusion in the Fourth
Diversity Further Notice that doing so will further the goal of
designing policies to advance diversity.
101. The Fourth Diversity Further Notice sought comment on the
proper definition of ``ownership'' in the NCE context, asking whether
looking at the composition of the board of directors or other governing
body of an NCE station would be appropriate for determining
``ownership'' for Form 323-E purposes. Several commenters support this
approach, noting, for example, that board members have legally
cognizable duties to the station licensees, often are involved in
station operations and hiring decisions, have final authority over NCE
licensees, and are responsible to the local communities they serve.
Other commenters argue that dissimilarities between the governance of
commercial and NCE stations precludes any definition of ``ownership''
in the NCE context. These parties note that board members do not have
equity stakes in the stations they serve; are often governmental
officials, governmental appointees, individuals elected by station
members, or volunteers; and often are not involved in day-to-day
station operations.
102. The Commission finds that officers and directors of NCE
stations already are defined as attributable interest holders in NCE
stations and that such individuals are already identified on Form 323-
E. The additional requirements imposed in the Report and Order do not
involve crafting or imposing a new legal definition of `ownership' with
respect to NCE stations. For purposes of Form 323 and 323-E, the
concept of ownership relies on the attribution standards set forth in
section 73.3555 of the Commission's rules. The Report and Order notes
the instances in which individuals or entities may hold attributable
ownership interests in commercial broadcast stations without holding
equity interests in those stations. For example, an officer or director
of a commercial broadcast licensee is an attributable owner of the
licensee's station(s), regardless of whether he or she has any equity
interest in the licensee. The Commission's standards for attributable
ownership generally do not depend on equity positions, and many parties
hold attributable interests in stations without any equity involvement
in those stations. These attribution standards apply to both commercial
and noncommercial stations, and the individuals and entities these
standards capture have the potential to exert influence over the
licensee, regardless of whether the station at issue is commercial or
noncommercial. The Commission adds that the observation that NCE board
members are often governmental officials, governmental appointees,
individuals elected by station members, or volunteers does not alter
the Commission's view, as the attribution standards rely not on the
manner in which that individual became a member of the station's
governing body, but on the ability to influence station programming or
operations of that station that the membership confers. Accordingly,
arguments that the Commission should not impose these additional
requirements for NCE stations because the individuals have no equity
ownership therefore are not compelling. The Commission notes that its
rules do allow officers and directors to be exempted from attribution
in limited circumstances, even in the NCE context.
103. The Commission is unconvinced that providing the race, gender,
and ethnicity on Form 323-E is burdensome and would discourage board
participation. Many NCE stations already provide similar information in
an annual report to the Corporation for Public Broadcasting (CPB), and
the record does not reflect that the CPB reporting is burdensome or
discourages participation. The Commission does not believe that
providing similar information to the Commission would have a
significantly different impact, and other actions adopted herein should
reduce the burden on all filers. Accordingly, the Commission believes
that any additional burdens associated with providing race, gender, and
ethnicity information are outweighed by the benefits of requiring the
reporting of such information.
104. The Report and Order also concludes that extending the RUFRN
mechanism to Form 323-E is necessary to help ensure the reliability of
the broadcast ownership data it collects. While some commenters support
the conclusion that RUFRNs are essential to allow analysis of the data,
others argue that the RUFRNs would offer limited utility on Form 323-E.
The Commission disagrees. The Commission believes that a unique
identifier for each individual attributable interest holder is
necessary to make the NCE data aggregable, machine readable, and
searchable in the same manner as commercial broadcast station
information. As the GAO recognized, to fully understand and analyze the
ownership of broadcast stations, NCE stations must be included. The
Commission's experience with the commercial biennial ownership reports
from 2009, 2011, and 2013 revealed that use of SUFRNs is not workable
to create data reliability and the record in this proceeding offers no
reason to believe that use of SUFRNs in broadcast ownership reports for
NCE stations would likely be any more successful. The presence of the
RUFRN on the reports for noncommercial stations will allow the tracking
of ownership trends over time and allow us to determine with certainty
the presence of multiple broadcast interests.
105. The Commission also disagrees with commenters that argue that
the CORES FRN and RUFRN requirements are unduly burdensome and would
[[Page 19455]]
discourage people from serving on the boards of NCE stations. The
process for obtaining a CORES FRN or RUFRN is quite simple and only has
to be completed once. And while the first time they file the revised
Form 323-E, NCE filers may require additional time and effort to
coordinate with attributable interest holders, the Commission finds
that the sufficient lead time between now and the 2017 filing window
will sufficiently mitigate any burden. The Commission is not persuaded
that the requirement will significantly inhibit interest holders from
serving on the boards of NCE stations as they are already identified as
such on Form 323-E. Moreover, the attributable interest holder need not
share any personally identifying information with anyone other than the
Commission in order to obtain a CORES FRN or an RUFRN. The Commission
does not believe that the RUFRN would serve as a serious disincentive
to participation in NCE stations, and reminds filers that SUFRNs will
be available for use on Form 323-E in the same limited circumstances
that SUFRNs will be available to Form 323 filers.
106. Limited Availability of SUFRNs. The Report and Order retains
the availability of the SUFRN, but only for the limited purpose of
protecting the position of filers in the case of interest holders that
refuse to obtain an FRN or provide the licensee with the information
necessary to generate an FRN for the interest holder. The Commission
expects that where an individual interest holder does not already have
a CORES FRN, filers will acquire an RUFRN or CORES FRN for such
individuals after obtaining the requisite identifying information, or
will instruct the individual to obtain his or her own RUFRN or CORES
FRN and to provide the FRN to the filer for reporting on the biennial
ownership report form. In order for the RUFRN system to be effective,
the Commission believes that it is necessary to ensure that filers are
using reasonable and good faith efforts to obtain RUFRNs from
individuals with reportable interests (or from CORES on behalf of such
individuals). Filers should take specific steps to substantiate that
they are making such efforts, and the Commission finds that instructing
an individual about his or her obligations and about potential
enforcement action are specific steps that would demonstrate
``reasonable and good faith efforts.'' An SUFRN may be obtained only if
an individual still refuses to provide a means of reporting a valid
RUFRN or CORES FRN after the filer has taken such steps. If an SUFRN is
used, the Commission may take enforcement action against the filer and/
or the recalcitrant individual. The filer itself will be exempt from
enforcement action if the filer substantiates that it has used
reasonable and good faith efforts as described herein.
107. The Media Bureau is directed to include instructions for Forms
323 and 323-E and post language on its Form 323 and 323-E Web site,
informing reportable interest holders of their obligation to obtain and
provide an RUFRN or CORES FRN, or to permit an RUFRN or CORES FRN to be
acquired on their behalf, and to alert interest holders of the risk of
enforcement action for failure to provide an RUFRN or CORES FRN or to
permit an RUFRN or CORES FRN to be obtained. The Commission anticipates
that the 2017 filing period will be the first filing period that the
requirement will be implicated, and the time frame mitigates any
potential burden because filers will have ample time to ensure that
they have a current and correct RUFRN or CORES FRN for the individuals
and entities reported on the Forms 323 and 323-E.
108. Filing Burden Reductions and Improved Data Integrity. In the
Report and Order, the Commission also implemented a number of changes
to Forms 323 and 323-E and moved the filing deadlines in order to
reduce filing burdens and improve data quality.
109. To permit filers more time to file Form 323, the Commission
moved the filing deadline from November 1 to December 1. The Commission
found that the 60-day period between the October 1 ``as of'' date and
the filing date should provide sufficient flexibility for filers such
that other deadlines or holidays do not complicate compliance. The
Commission also adopted a uniform filing date of December 1 for filing
the Form 323-E biennial ownership report. In the Fourth Diversity
Further Notice, the Commission sought comment on whether it should
adopt uniform filing and ``as of'' dates for Form 323-E. Currently, NCE
stations submit biennial Form 323-E in accordance with a set of
staggered deadlines. Some commenters suggested that a uniform filing
date for Form 323-E should be in the first quarter, to correspond to a
date that certain NCE stations submit similar data to CPB. The
Commission found that this suggestion would not allow it to obtain the
synchronized data, i.e., commercial and noncommercial ownership data
that is captured on the same date, needed to evaluate minority and
female participation in broadcasting over all the services over the
time. Moreover, because not all NCE stations submit data to CPB,
efforts by the Commission to coordinate with CPB would not fully
address the filing deadline issue. Accordingly, the Commission will
require NCE filers to submit Form 323-E in accordance with the same
``as of'' date and filing deadline applicable to commercial
broadcasters (i.e., their filings will be due on December 1 of odd-
numbered years and the ownership information provided should be current
as of October 1 of the filing year). The Commission required NCE
stations to file Form 323-E on the same schedule as Form 323 in order
to make the ownership data collected by the ownership reports easier to
work with and to facilitate ownership studies using data captured on a
uniform ``as of'' date.
110. The current version of Form 323 allows parent-entity filers to
list only one subsidiary licensee and its associated stations. As a
result, parent entities with multiple licensee subsidiaries must file
separate ownership reports for each of those licensees. In the Sixth
Diversity Further Notice, the Commission sought comment on a proposal
to modify the form to allow parents with several wholly owned licensee
subsidiaries to list all of those licensees and their associated
stations on one report and whether the proposal should be expanded to
allow parent entities to file consolidated reports for all of their
licensee subsidiaries, regardless of whether or not those subsidiaries
are wholly owned. The Commission found that modifying Form 323 to allow
a parent entity with multiple licensee subsidiaries to file one report
that covers all of those licensees will greatly reduce the burden on
many filers with no negative impact on the quality of the ownership
data. Accordingly, the Commission adopted three changes to Form 323:
(1) It modified section I, question 7, of the form to allow parent
filers to list multiple subsidiary licensees and the stations
associated with those licensees; (2) it deleted the portion of section
II-A, question 3(a) (non-biennial), and section II-B, question 3(a)
(biennial), asking filers to identify the relation that each reportable
individual or entity has to the licensee; and (3) it deleted section
II-B, question 4 (biennial), asking each parent filer to identify the
entity or entities directly below it in the licensee's ownership chain.
The revised version of Form 323-E incorporates these modifications as
well. No commenters opposed these proposals.
111. In the Review of Media Data Practices proceeding, NAB
requested that the Commission eliminate section
[[Page 19456]]
II-B, question 3(c), of Form 323, which requires a filer to disclose
the other attributable newspaper and broadcast interests of
attributable parties listed in response to section II-B, question 3(a).
NAB argued that submission of this data is burdensome, requiring
significant amounts of data entry and file uploading via a series of
subforms and spreadsheet attachment(s). The Commission sought comment
on this proposal in the Sixth Diversity Further Notice and no
commenters opposed the proposal. The Commission declined to eliminate
the question in its entirety, but believes that modifications to the
reporting requirements for other attributable broadcast and daily
newspaper interests will reduce filing burdens and improve the quality
of the Commission's data. Because information concerning the other
attributable broadcast interests of a party listed on one ownership
report is contained on one or more other ownership reports, the
Commission believes it can greatly simplify the reporting of other
broadcast interests of attributable parties on the biennial Form 323
without sacrificing the completeness or usability of the Commission's
data. In other words, the public can ascertain a reported interest
holder's other broadcast interests by performing a search of other
filed ownership reports. Accordingly, the Commission (1) deletes the
broadcast interest portion section II-B, question 3(c); (2) adds simple
yes/no buttons to relevant subforms; (3) modifies the public search
capabilities of the electronic filing system to allow users to search
ownership report filings by FRN and output the results as either a list
of reports or a list of stations.
112. Information concerning daily newspaper interests does not
appear anywhere on Form 323 except in response to question 3(c). In
other words, an interest holder's daily newspaper interests cannot be
ascertained except in direct response to this question. The Commission
determined that it therefore cannot remove the newspaper interests
portion of section II-B, question 3(c), without sacrificing the quality
and completeness of the data. However, to improve the quality of the
data collected in response to this question and enhance the ability of
parties to search, aggregate, and cross-reference that data, the
Commission modified the subforms and the spreadsheet attachments for
the newspaper interests portion of section II, question 3(c), to
require filers to provide an FRN (either a CORES FRN or RUFRN, or an
SUFRN, subject to the limitations addressed above) for each person and
entity listed. In order to further reduce filing burdens and improve
the quality of the ownership data, the Commission incorporated these
changes into biennial and non-biennial versions of Form 323 and Form
323-E.
113. In the Report and Order, the Commission adopted commenters'
proposal to allow parties to identify themselves as Tribal entities on
Form 323-E in order to inform the Commission's ongoing efforts to
expand broadcast opportunities for Tribal entities. Because these
efforts involve both commercial and noncommercial broadcasting, and in
light of the Commission's ongoing efforts to improve its broadcast
ownership data collections, the Commission found that the rationale for
adding a Tribal Entity designation to Form 323-E applied equally to
Form 323. The Commission found that the collection of this information
on a biennial basis will be minimally burdensome, and any increased
burden is outweighed by the significant burden-reducing measures
adopted in the Report and Order. Accordingly, the Commission modified
section II-B, question 2(a), of Form 323 and the parallel question in
the revised version of Form 323-E to allow (but not require) filers to
indicate whether or not licensees and/or reported attributable entities
are Tribal Nations or Tribal entities.
114. The Commission also opted to include in section I, question 8,
of Form 323 the designation for limited liability companies. Currently,
the question requires a filer to identify the nature of the respondent,
and currently allows the filer to choose between the designations of
sole proprietorship, for-profit corporation, not-for-profit
corporation, general partnership, and limited partnership. Respondents
that do not fit into one of these categories must select ``other'' and
provide an explanatory exhibit. The Commission found that adding the
limited liability company designation to this question will reduce
burdens on limited liability company filers by eliminating the need to
provide an exhibit.
115. The Commission also reduced burdens and improved the quality
and usability of the ownership data by clarifying the manner in which
filers should report contracts and other instruments that must be filed
with the Commission, as described in 47 CFR 73.3613. Currently, Form
323 and Form 323-E require stations to list all contracts required to
be filed with the Commission pursuant to Sec. 73.3613. The respondent
on any given report may or may not be a party to these contracts and
instruments. Some filers list all relevant documents on the licensee's
ownership report, while other filers opt to list different documents on
different reports. The latter approach requires filers to include
different, often overlapping, lists of documents on multiple reports
and forces researchers and other parties to examine all of a station's
ownership filings to construct a complete list of that station's
required contracts and instruments. To address these issues, the
Commission modified the relevant questions on Form 323 and Form 323-E
to require all Sec. 73.3613 documents for a station to be listed on
the report for that station's licensee. The Commission determined that
clarification will reduce filing burdens, because filers will be able
to enter all required information on the licensee report and simply
check ``N/A'' for all parent filings.
116. The Commission also reduced burdens by eliminating question 2
of section II-A and section II-B of Form 323, which requires filers to
provide capitalization information for any respondent that is a
licensee, permittee, or entity that has a majority interest in, or
otherwise exercises de facto control over the licensee. Eliminating
this question will reduce filing burdens without meaningfully
compromising data quality because question 3(a) better addresses the
Commission's need to ascertain equity ownership of, and voting rights
in, the respondent than does question 2(a).
117. To improve the quality of the broadcast ownership data
collections, the Commission added a ``yes/no'' question to each subform
of Form 323, section II-A, question 3(a) (non-biennial), and section
II-B, question 3(a) (biennial), to allow parties to identify jointly
held voting interests. In certain circumstances, two or more parties
hold a voting interest in a licensee or other respondent jointly. Two
parties may, for example, hold 100 percent of the voting interest in an
entity together, as joint tenants (as opposed to each individual
holding 50 percent of the voting interests). Similarly, agreements for
partnerships or limited liability companies may provide that two or
more individuals exercise voting power together, such that any of the
relevant parties can fully exercise the voting interest. Because the
current version of Form 323 provides no mechanism for parties to
identify situations in which voting interests are jointly held, it is
likely that filers report such interests in different ways, which leads
to errors and inconsistencies in the Commission's data. In reviewing
submitted data, the Commission found
[[Page 19457]]
that the inability to identify and interpret jointly held voting
interests on ownership reports rendered it impossible for Commission
staff to electronically or manually process those reports. Parties
reviewing non-biennial Form 323 filings will face similar difficulties.
Accordingly, the Commission finds that adding a question to Form 323 to
address this issue is a minimally burdensome way to improve the quality
of the Commission's ownership data. Because the Commission did not
believe that there are many jointly held voting interests in the NCE
context, the Commission did not make a similar modification to Form
323-E at this time.
118. The Commission also modifies Form 323 section II-A, question
3(a) (non-biennial) and section II-B, question 3(a) (biennial) to add a
new positional interest category that will allow filers to identify
reported parties that are attributable by virtue of a joint sales
agreement (JSA) or local marketing agreement (LMA). This change is
designed to increase the usability of the Commission's ownership data
and reflects the Commission's recent decision concerning attribution of
television JSAs.
119. The Report and Order also addressed some proposals submitted
by commenters that it has declined to implement at this time. The
Commission declined to adopt a proposal to extend reporting
requirements to parties that operate a station pursuant to a
nonattributable LMA. The Commission declined to extend the reporting
requirement to nonattributable operating agreements because it was not
convinced that the current record reflects that a data collection
focused on this category of nonattributable interest holders would
meaningfully improve the data set. The Commission also declined to
adopt a proposal to create a separate filing category for transfers to
bankruptcy trustees, debtors-in-possession, or trusts, because the
record did not demonstrate the utility of the information, particularly
in light of the fact that the Commission's online application database
and/or Web site already provide information concerning individual
transactions. The Public Access portion of CDBS allows users to search
for assignment applications based on multiple criteria, including call
sign, Facility ID Number, service, station location (city and state),
application file number, and applications status. This electronic
system also gives users access to the full content of assignment and
transfer applications and provides information concerning legal actions
pertaining to those applications.
120. Several commenters asked the Commission to modify its
electronic filing system, the Public Access portion of CDBS, or the
online instructions for CDBS. For example, parties asked the Commission
to create new filing systems for parties with limited broadband access
and/or to update CDBS accounts to recognize the type of entity, list
only reports applicable to that entity, indicate previous filings and
dates, allow users to pre-populate entries in new reports based on
prior reports (including forms of different types), and provide
automated filing reminders. Several of these capabilities already exist
in CDBS. For example, if a party uses the same CDBS account for all of
its filings, that account already contains the station's prior filings
as well as information about those filings, including submission dates.
CDBS in many cases allows users to pre-populate new ownership reports
by copying or prefilling data from another filing of the same type. To
utilize these and other burden-reducing capabilities in CDBS, filers
sometimes use different CDBS accounts for different types of filings
and different entities. The Commission did not want filers to lose the
ability to benefit from the ability to use the same CDBS account for
all of its filings. The remaining suggestions were either technically
infeasible or would impose significant costs on the Commission that
appear to exceed any possible benefits at this time. Other commenters
suggested various enhancements to search capabilities within the Public
Access portion of CDBS, including searching ownership reports by
gender, race, ethnicity, voting percentage, and equity percentage;
displaying explanatory messages when searches produce no results; and
alerting searchers about assignment and/or transfer applications.
Researchers and other parties currently can download the data files
from the Commission's Web site at any time and study, search, and
manipulate the data in a wide variety of ways. This limits the need for
the Commission to develop an extensive catalog of complex query options
within the Public Access portion of CDBS. The Commission found that the
costs of implementing these suggested modifications to CDBS at this
time exceed the benefits.
121. Several commenters asked that the Commission not audit
ownership data submitted by NCE stations and/or that NCE entities be
subjected to reduced compliance standards and/or forfeitures. The
Commission found that in order to maintain and improve the quality of
both the commercial and noncommercial ownership data, the Commission
must have the ability to audit broadcast ownership data and hold
parties responsible for their submissions. Accordingly, the Commission
declined to make any changes to its approach to ownership report data
audits and related forfeitures.
3. Description and Estimate of the Number of Small Entities to Which
the Proposed Rules Would Apply
122. The RFA directs agencies to provide a description of, and,
where feasible, an estimate of the number of small entities that may be
affected by the proposed rules, if adopted. The RFA defines the term
``small entity'' as having the same meaning as the terms ``small
business,'' ``small organization,'' and ``small governmental
jurisdiction'' under section 3 of the Small Business Act. 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 which: (1) is independently owned and operated; (2) is
not dominant in its field of operation; and (3) satisfies any
additional criteria established by the Small Business Administration
(SBA). The actions taken herein affect small television and radio
broadcast stations. A description of these small entities, as well as
an estimate of the number of such small entities, is provided below.
123. Television Broadcasting. The SBA defines a television
broadcasting station that has no more than $38.5 million in annual
receipts as a small business. The definition of business concerns
included in this industry states that establishments are primarily
engaged in broadcasting images together with sound. These firms operate
television broadcasting studios and facilities for the programming and
transmission of programs to the public. These firms also produce or
transmit visual programming to affiliated broadcast television
stations, which in turn broadcast the programs to the public on a
predetermined schedule. Programming may originate in their own studio,
from an affiliated network, or from external sources. Census data for
2007 indicate that 808 such firms were in operation for the duration of
that entire year. Of these, 709 had annual receipts of less than $25.0
million per year and 99 had annual receipts of $25.0 million or more
per year. Based on this data and the associated size standard, the
Commission concludes that the majority of such firms are small.
[[Page 19458]]
124. Additionally, the Commission has estimated the number of
licensed commercial television stations to be 1,391. According to
Commission staff review of BIA/Kelsey, LLC's Media Access Pro
Television Database on July 22, 2015, about 1,268 of an estimated 1,391
commercial television stations (or approximately 91 percent) had
revenues of $38.5 million or less. The Commission has estimated the
number of licensed noncommercial educational television stations to be
394. We do not have revenue data or revenue estimates for noncommercial
stations. These stations rely primarily on grants and contributions for
their operations, so we will assume that all of these entities qualify
as small businesses. We note that in assessing whether a business
entity 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 any
changes to the filing requirements for FCC Form 323 or Form 323-E,
because the revenue figures on which this estimate is based do not
include or aggregate revenues from affiliated companies.
125. An element of the definition of ``small business'' is that the
entity not be dominant in its field of operation. The Commission is
unable at this time and in this context to define or quantify the
criteria that would establish whether a specific television station is
dominant in its market of operation. Accordingly, the foregoing
estimate of small businesses to which the rules may apply does not
exclude any television stations from the definition of a small business
on this basis and is therefore over-inclusive to that extent. An
additional element of the definition of ``small business'' is that the
entity must be independently owned and operated. 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.
126. Radio Broadcasting. The SBA defines a radio broadcasting
entity that has $38.5 million or less in annual receipts as a small
business. Business concerns included in this industry are those
``primarily engaged in broadcasting aural programs by radio to the
public.'' Census data for 2007 indicate that 2,926 such firms were in
operation for the duration of that entire year. Of these, 2,877 had
annual receipts of less than $25.0 million per year and 49 had annual
receipts of $25.0 million or more per year. Based on this data and the
associated size standard, the Commission concludes that the majority of
such firms are small.
127. Further, according to Commission staff review of BIA/Kelsey,
LLC's Media Access Pro Radio Database on July 22, 2015, about 11,354
(or about 99.9 percent) of 11,364 commercial radio stations in the
United States have revenues of $38.5 million or less. The Commission
has estimated the number of licensed noncommercial radio stations to be
4,091. We do not have revenue data or revenue estimates for these
stations. These stations rely primarily on grants and contributions for
their operations, so we will assume that all of these entities qualify
as small businesses. We note that in assessing whether a business
entity 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 any
changes to filing requirements for FCC Form 323 or Form 323-E, because
the revenue figures on which this estimate is based do not include or
aggregate revenues from affiliated companies.
128. In this context, the application of the statutory definition
to radio stations is of concern. 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 and in this context to define or
quantify the criteria that would establish whether a specific radio
station is dominant in its field of operation. Accordingly, the
foregoing estimate of small businesses to which the rules may apply
does not exclude any radio station from the definition of a small
business on this basis and is therefore over-inclusive to that extent.
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.
129. Class A TV and LPTV Stations. The rules and policies adopted
herein apply to licensees of low power television (LPTV) stations,
including Class A TV stations and, as well as to potential licensees in
these television services. The same SBA definition that applies to
television broadcast licensees would apply to these stations. The SBA
defines a television broadcast station as a small business if such
station has no more than $38.5 million in annual receipts. As of June
30, 2015, there are approximately 422 licensed Class A stations and
1,920 licensed LPTV stations. Given the nature of these services, we
will presume that all of these licensees qualify as small entities
under the SBA definition. We note, however, that under the SBA's
definition, revenue of affiliates that are not LPTV stations should be
aggregated with the LPTV station revenues in determining whether a
concern is small. Our estimate may thus overstate the number of small
entities since the revenue figure on which it is based does not include
or aggregate revenues from non-LPTV affiliated companies.
4. Description of Projected Reporting, Recordkeeping and Other
Compliance Requirements
130. The Report and Order requires all individuals reported on Form
323 and Form 323-E to obtain and provide a CORES FRN or an RUFRN.
However, the SUFRN remains available in limited circumstances, but
individuals for whom an SUFRN is reported may be subject to enforcement
action. Currently, the Commission requires all attributable interest
holders of commercial broadcast stations to be reported on Form 323.
The Report and Order also now requires filers of Form 323-E to provide
the race, gender, and ethnicity of individuals reported on Form 323-E.
The Report and Order states that both Form 323 and Form 323-E are due
no later than December 1, 2017, and every two years thereafter. The
Ownership Reports must reflect information current as of October 1 of
the filing year.
5. Steps Taken To Minimize Significant Impact on Small Entities, and
Significant Alternatives Considered
131. The RFA requires an agency to describe any significant
alternatives that is has considered in reaching its proposed approach,
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 and 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.
132. The Report and Order explains that the RUFRN is designed to be
an alternative to requiring submission of an individual's full SSN to
CORES in order to generate a CORES FRN for purposes of being reported
on the biennial ownership reports. The Commission found that an FRN
generated through CORES is far superior for purposes of
[[Page 19459]]
tracking individual owners and that the decision to allow individual
attributable interest holders the option of obtaining and using an
RUFRN in lieu of a TIN/SSN backed CORES FRN will impose minimal costs
and burdens, if any, on individuals or filers. However, the Commission
decided to maintain the availability of the SUFRN in limited
circumstances so that filers, including small entities, may timely
submit a Form 323 or Form 323-E even if the filer was unable to obtain
a CORES FRN or RUFRN for a reported individual. The individual for whom
an SUFRN is reported may be subject to enforcement action for failure
to obtain and provide a CORES FRN or RUFRN, pursuant to Commission
policy and its rules.
133. The Commission has extended the filing deadline for Form 323
to permit all filers, including small businesses, an additional 30 days
to file the ownership report. The Commission also set the filing
deadlines for Form 323-E to coincide with the deadlines for Form 323.
The Commission considered a proposal to set the uniform filing deadline
for Form 323-E to the first quarter to coincide with the date that
certain NCE stations submit similar data to CPB. The Commission found
that this suggestion would not allow it to obtain the synchronized data
needed to evaluate minority and female participation in broadcasting
over all the services over time. Moreover, because not all NCE stations
submit data to CPB, efforts by the Commission to coordinate with CPB
would not fully address the filing deadline issue.
134. The Report and Order adopted changes to Forms 323 and 323-E to
reduce the filing burden on all filers, including small entities. The
Commission alleviated the filing burden by modifying Form 323 to allow
a parent entity with multiple licensee subsidiaries to file one report
that covers all of those licensees. This modification will also be
reflected on the revised Form 323-E. The Commission also deleted the
broadcast interests portion of section II-B, question 3(c), and instead
will add simple yes/no radio buttons to the subforms of that question
that require filers to indicate whether each reported entity or
individual has other attributable broadcast interests. In order to
further reduce filing burdens and improve the quality of its ownership
data, the Commission incorporated this change into biennial and non-
biennial versions of Form 323 and Form 323-E. The Commission also
modified the relevant questions on Form 323 and Form 323-E to require
all section 73.3613 documents for a station to be listed on the report
for that station's licensee. This clarification will reduce filing
burdens, because filers will be able to enter all required information
on the licensee report and simply check ``N/A'' for all parent filings.
The Commission also reduced burdens by eliminating on Form 323,
question 2 of section II-A and section II-B, which requires filers to
provide capitalization information for any respondent that is a
licensee, permittee or entity that has a majority interest in, or
otherwise exercises de facto control over the licensee. Form 323 will
now include a limited liability company designation in section 1,
question 8, which will reduce the filing burden on limited liability
company filers by eliminating the need to provide an explanatory
exhibit.
6. Report to Congress
135. Commission will send a copy of the Report and Order, including
this FRFA, in a report to Congress and the Government Accountability
Office, pursuant to the Congressional Review Act. In addition, the
Commission will send a copy of the Report and Order, including this
FRFA, to the Chief Counsel for Advocacy of the Small Business
Administration. A copy of this Report and Order and FRFA (or summaries
thereof) will also be published in the Federal Register.
B. Congressional Review Act
136. The Commission will send a copy of this Report and Order in a
report to be sent to Congress and the Government Accountability Office
pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).
V. Ordering Clauses
137. Accordingly it is ordered that, pursuant to the authority
contained in sections 1, 2(a), 4(i), 257, 303(r), 307, 309, and 310 of
the Communications Act of 1934, as amended, 47 U.S.C. 151, 152(a),
154(i), 257, 303(r), 307, 309, and 310, this Report and Order is
adopted.
138. It is further ordered that the Koerner & Olender Petition for
Reconsideration and the Fletcher Heald Petition for Reconsideration are
granted to the extent the relief requested is consistent with this
Report and Order and are otherwise denied.
139. It is further ordered that the rule amendments attached hereto
as Appendix B and the revised filing procedures and changes to FCC Form
323 and FCC Form 323-E adopted in this Report and Order will become
effective upon publication of a notice in the Federal Register
announcing approval by the Office of Management and Budget.
140. It is further ordered that the Media Bureau is hereby
delegated authority to make all necessary changes to Form 323, Form
323-E, and the Commission's electronic database system to implement the
changes adopted in this Report and Order.
141. It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of this Report and Order, including the Final Regulatory
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small
Business Administration.
142. It is further ordered that the Commission SHALL SEND a copy of
this Report and Order in a report to be sent to Congress and the
Government Accountability Office pursuant to the Congressional Review
Act, see 5 U.S.C. 801(a)(1)(A).
List of Subjects
47 CFR Part 73
Radio broadcast services.
47 CFR Part 74
Experimental radio, Auxiliary, Special broadcast and other program
distributional services.
Federal Communications Commission.
Gloria J. Miles,
Federal Register Liaison Officer, Office of the Secretary.
Final Rules
For the reasons discussed in the preamble, the Federal
Communications Commission amends 47 CFR parts 73 and 74 as follows:
PART 73--RADIO BROADCAST SERVICES
0
1. The authority citation for part 73 continues to read as follows:
Authority: 47 U.S.C. 154, 303, 334, 336 and 339.
0
2. Section 73.3615 is amended by revising paragraphs (a) through (f) to
read as follows:
Sec. 73.3615 Ownership reports.
(a) The Ownership Report for Commercial Broadcast Stations (FCC
Form 2100, Schedule 323) must be filed electronically every two years
by each licensee of a commercial AM, FM, or TV broadcast station and
any entity that holds an interest in the licensee that is attributable
pursuant to Sec. 73.3555 (each a ``Respondent''). The ownership report
shall be filed by December 1 in all odd-numbered years. Each ownership
report shall provide all information required by, and comply with all
requirements set forth in, the version of FCC Form
[[Page 19460]]
2100, Schedule 323 (including all instructions for the form and
schedule) that is current on October 1 of the year in which the
ownership report is filed. The information provided on each ownership
report shall be current as of October 1 of the year in which the
ownership report is filed. A Respondent with a current and unamended
biennial ownership report (i.e., an ownership report that was filed
pursuant to this subsection) on file with the Commission that is still
accurate and which was filed using the version of FCC Form 2100,
Schedule 323 that is current on October 1 of the year in which its
biennial ownership report is due may electronically validate and
resubmit its previously filed biennial ownership report.
(b)(1) Each permittee of a commercial AM, FM or TV broadcast
station and any entity that holds an interest in the permittee that is
attributable pursuant to Sec. 73.3555 (each a ``Respondent'') shall
file an ownership report on FCC Form 2100, Schedule 323 within 30 days
of the date of grant by the FCC of an application by the permittee for
original construction permit. Each ownership report shall provide all
information required by, and comply with all requirements set forth in,
the version of FCC Form 2100, Schedule 323 (including all instructions
for the form and schedule) that is current on the date on which the
ownership report is filed.
(2) Except as specifically noted below, each permittee of a
commercial AM, FM or TV broadcast station and any entity that holds an
interest in the permittee that is attributable pursuant to Sec.
73.3555 (each a ``Respondent'') shall file an ownership report on FCC
Form 2100, Schedule 323 on the date that the permittee applies for a
station license. Each ownership report shall provide all information
required by, and comply with all requirements set forth in, the version
of FCC Form 2100, Schedule 323 (including all instructions for the form
and schedule) that is current on the date on which the ownership report
is filed. If a Respondent has a current and unamended ownership report
on file with the Commission that was filed pursuant to paragraphs
(b)(1) or (c) of this section, was submitted using the version of FCC
Form 2100, Schedule 323 that is current on the date on which the
ownership report due pursuant to paragraph (b)(2) is filed, and is
still accurate, the Respondent may certify that it has reviewed such
ownership report and that it is accurate, in lieu of filing a new
ownership report.
(c) Each permittee or licensee of a commercial AM, FM or TV
broadcast station and any entity that holds an interest in the
permittee or licensee that is attributable pursuant to Sec. 73.3555
(each a ``Respondent''), shall file an ownership report on FCC Form
2100, Schedule 323 within 30 days of consummating authorized
assignments or transfers of permits and licenses. Each ownership report
shall provide all information required by, and comply with all
requirements set forth in, the version of FCC Form 2100, Schedule 323
(including all instructions for the form and schedule) that is current
on the date on which the ownership report is filed.
(d) The Ownership Report for Noncommercial Broadcast Stations (FCC
Form 2100, Schedule 323-E) must be filed electronically every two years
by each licensee of a noncommercial educational AM, FM or TV broadcast
station and any entity that holds an interest in the licensee that is
attributable pursuant to Sec. 73.3555 (each a ``Respondent''). The
ownership report shall be filed by December 1 in all odd-numbered
years. Each ownership report shall provide all information required by,
and comply with all requirements set forth in, the version of FCC Form
2100, Schedule 323-E (including all instructions for the form and
schedule) that is current on October 1 of the year in which the
ownership report is filed. The information provided on each ownership
report shall be current as of October 1 of the year in which the
ownership report is filed. A Respondent with a current and unamended
biennial ownership report (i.e., an ownership report that was filed
pursuant to this subsection) on file with the Commission that is still
accurate and which was filed using the version of FCC Form 2100,
Schedule 323-E that is current on October 1 of the year in which its
biennial ownership report is due may electronically validate and
resubmit its previously filed biennial ownership report.
(e)(1) Each permittee of a noncommercial educational AM, FM or TV
broadcast station and any entity that holds an interest in the
permittee that is attributable pursuant to Sec. 73.3555 (each a
``Respondent'') shall file an ownership report on FCC Form 2100,
Schedule 323-E within 30 days of the date of grant by the FCC of an
application by the permittee for original construction permit. Each
ownership report shall provide all information required by, and comply
with all requirements set forth in, the version of FCC Form 2100,
Schedule 323-E (including all instructions for the form and schedule)
that is current on the date on which the ownership report is filed.
(2) Except as specifically noted below, each permittee of a
noncommercial educational AM, FM or TV broadcast station and any entity
that holds an interest in the permittee that is attributable pursuant
to Sec. 73.3555 (each a ``Respondent'') shall file an ownership report
on FCC Form 2100, Schedule 323-E on the date that the permittee applies
for a station license. Each ownership report shall provide all
information required by, and comply with all requirements set forth in,
the version of FCC Form 2100, Schedule 323-E (including all
instructions for the form and schedule) that is current on the date on
which the ownership report is filed. If a Respondent has a current and
unamended ownership report on file with the Commission that was filed
pursuant to paragraphs (e)(1) or (f) of this section, was submitted
using the version of FCC Form 2100, Schedule 323-E that is current on
the date on which the ownership report due pursuant to this subsection
is filed, and is still accurate, the Respondent may certify that it has
reviewed such ownership report and that it is accurate, in lieu of
filing a new ownership report.
(f) Each permittee or licensee of a noncommercial educational AM,
FM or TV broadcast station, and any entity that holds an interest in
the permittee or licensee that is attributable pursuant to Sec.
73.3555 (each a ``Respondent''), shall file an ownership report on FCC
Form 2100, Schedule 323-E within 30 days of consummating authorized
assignments or transfers of permits and licenses. Each ownership report
shall provide all information required by, and comply with all
requirements set forth in, the version of FCC Form 2100, Schedule 323-E
(including all instructions for the form and schedule) that is current
on the date on which the ownership report is filed.
* * * * *
PART 74--EXPERIMENTAL RADIO, AUXILIARY, SPECIAL BROADCAST AND OTHER
PROGRAM DISTRIBUTIONAL SERVICES
0
3. The authority citation for part 74 continues to read as follows:
Authority: 47 U.S.C. 154, 302a, 303, 307, 309, 336 and 554.
0
4. Section 74.797 is revised to read as follows:
Sec. 74.797 Biennial Ownership Reports.
The Ownership Report for Commercial Broadcast Stations (FCC Form
2100, Schedule 323) must be electronically filed by December 1 in all
odd-numbered years by each licensee of
[[Page 19461]]
a low power television station or other Respondent (as defined in Sec.
73.3615(a) of this chapter). A licensee or other Respondent with a
current and unamended biennial ownership report (i.e., a report that
was filed pursuant to this subsection) on file with the Commission that
is still accurate and which was filed using the version of FCC Form
2100, Schedule 323 that is current on October 1 of the year in which
its biennial ownership report is due may electronically validate and
resubmit its previously filed biennial ownership report. The
information provided on each ownership report shall be current as of
October 1 of the year in which the ownership report is filed. For
information on filing requirements, filers should refer to Sec.
73.3615(a) of this chapter.
[FR Doc. 2016-04838 Filed 4-1-16; 8:45 am]
BILLING CODE 6712-01-P