Here are some of the regulatory developments of significance to broadcasters from the past week, with links to where you can go to find more information as to how these actions may affect your operations.
- President Biden signed a Continuing Resolution passed by Congress averting a federal government shutdown that was to begin on January 19 for parts of the government, and on February 2 for other portions of the federal government – including the FCC and the FTC. The resolution provides funding for the FCC and the FTC through March 8.
- The FCC released two Notices of Proposed Rulemaking (NPRM) of interest to broadcasters:
- In the first NPRM, the FCC proposed to prioritize the review of non-routine license renewal, assignment of license, and transfer of control applications – providing faster processing of any issues that resulted in the application not being processed in the normal course, if the application was filed by a broadcast station that provides at least three hours per week of locally originated programming. The proposed prioritization policy was intended to incentivize stations to provide locally originated programming. The majority of the Commissioners suggested that this was needed in light of the FCC’s 2017 elimination of the rule requiring stations to maintain a main studio located in or near their communities of license and the related requirement that the main studio have local program origination capability (see our articles here and here regarding the former requirement). In the NPRM, the FCC asked for comments as to whether the elimination of the main studio was a mistake, questioning whether the basis for eliminating that rule – fostering the creation of more and better local content – had been achieved. While the FCC did not explicitly propose in the NPRM to reinstate the main studio rule, both Republican Commissioners dissented from the NPRM as they believed that the FCC was headed in that direction. We will write more about this proposal this coming week.
- In the second NPRM, the FCC proposed to require cable operators and direct broadcast satellite (DBS) providers to issue rebates to subscribers affected by blackouts resulting from failed retransmission consent negotiations with TV stations. Through the NPRM, the FCC seeks public comment on whether and how to require cable operators and DBS providers to issue these rebates. The FCC also requests comment on whether there are other methods to incentivize cable operators, DBS providers, and broadcasters to limit the occurrences of blackouts. The NPRM follows the FCC’s decision last month in which it proposed to require cable operators and DBS providers to disclose the occurrence of any blackouts resulting from failed retransmission consent negotiations with TV stations, which we discussed here and here.
- The FCC’s Media Bureau imposed significant financial penalties on several broadcasters for perceived violations of the FCC’s rules:
- The Bureau entered into a Consent Decree with the licensee of two Idaho FM stations requiring a $500,000 penalty and a compliance plan to resolve the Bureau’s investigation as to whether the stations violated the FCC’s rules governing sponsorship identification and maintenance of political files. The Bureau found that the station had broadcast paid programming, sponsored by a local political party and one of its leaders, which discussed controversial issues and featured candidates for public office, without providing on-air sponsorship identification announcements for multiple episodes of the program and numerous advertisements promoting it. The station also failed to note the federal issues and candidate appearances in the stations’ political files for multiple episodes of the program. With the 2024 political season already well underway, this decision should serve as a warning to all broadcasters of the potential consequences for failing to comply with the FCC’s political file requirements. For a deeper dive on election year planning, see our post, here, and our Political Broadcasting Guide.
- The FCC fined Cumulus Media $26,000 for its failure to upload one EEO Annual Public File Report to its online public inspection file until about 9 months after the due date. The FCC previously proposed a $32,000 fine on the company for its failure to timely upload the annual EEO report to the online public inspection files for five co-owned stations in a Georgia market. The principal change in this week’s decision was to reduce the fine by $6,000 – the amount previously proposed by the FCC for the licensee’s failure to self-assess its EEO program. This portion of the proposed fine was imposed on the theory that, if the licensee had been regularly assessing its program, it would have noted that the required report had not made it to the online public file and fixed that problem. This week’s decision reaffirms that reasoning but reduces the fine by the amount allocated to the failure to self-assess the program, finding that Cumulus may not have had notice that reviewing public file uploads was part of its obligation to self-assess its EEO program. See our Broadcast Law Blog article here for our further discussion of this case, which demonstrates the continuing importance that the FCC places on EEO enforcement.
- The Bureau entered into another Consent Decree with an Indiana AM station’s licensee requiring an $8,000 penalty to resolve issues arising from the Bureau’s review of a transfer of control application involving the licensee’s shareholders. First, the Bureau found that the licensee failed to obtain FCC approval by filing a transfer of control application for the transfer of shares of the licensee’s controlling shareholder to a trust of which the shareholder was the trustee. The licensee then failed to timely file an involuntary transfer of control application within 30 days of the former shareholder’s death to reflect the resulting change in the trustee, filing the involuntary transfer of control application over 18 months late. This is one of several recent cases that show that death of a controlling owner (or even estate planning by the owners of a station) can trigger FCC requirements for approval of changes in control of an FCC license, and penalties can result when such approvals are not obtained (see, for instance, the cases we noted here, here, here, and here).
- The Bureau proposed a $16,500 fine against the licensee of an Alabama FM translator station for allegedly failing to timely request FCC authorization for temporary facilities for the translator, operating the translator without proper FCC authorization, and falsely certifying in the translator’s license renewal application that it did not have any unresolved or adverse character issues. The Bureau proposed the fine based on its finding that the licensee had been operating the translator at variance from its license since June 2017 without obtaining FCC authorization to do so. Additionally, the Bureau found that the licensee failed to disclose in the renewal application that the licensee’s principals were involved in cases involving cancelled stations in which those individuals were found to have made false statements and operated those stations with unauthorized facilities. The FCC’s rules normally require a base fine of $10,000 for unauthorized operations, and a base fine of $3,000 for failing to request special temporary authority (STA) to operate at variance from a station’s license. In this case, however, the Bureau reduced the proposed fine for unauthorized operations from $10,000 to $5,000, and the proposed fine for the late-filed STA request from $3,000 to $1,500, because FM translator stations are secondary services. The Bureau, however, proposed a $10,000 fine for the licensee’s false certifications.
- The Media Bureau also took two actions that could result in the cancellation of station licenses:
- The Bureau dismissed an Oregon FM station’s license renewal application after determining that the station failed to operate from an authorized location for over twelve months and its license therefore terminated automatically pursuant to Section 312(g) of the Communications Act. Section 312(g) states that a station’s license will be automatically cancelled if the station that has not operated as authorized for a full year, unless the FCC makes an affirmative determination that there are public interest factors warranting the preservation of the license. The Bureau rejected the licensee’s claim that no authority was necessary as its move of its antenna from one site to another was less than one second different in geographical coordinates. The FCC found that a move of less than three seconds does not require a construction permit only when it involves a coordinate correction and, even then, the move requires FCC approval in a license application after the move. Neither a construction permit nor a license application was filed by this licensee. The Bureau also dismissed the station’s argument that it was exempt from requesting authority to move to a new transmission facility as the antenna at the new site was mounted in a tree, and thus did not require construction of a new tower. The Bureau dismissed the station’s argument as baseless, noting that placing a station’s antenna in a tree required prior FCC authorization just as placement of a station’s antenna on a tower because the FCC needs to know the precise location of any station’s transmission facilities to ensure adequate interference protection to other stations and the safety of air navigation.
- The Bureau, along with the FCC’s Managing Director, issued an Order to Pay or to Show Cause to the licensee of an Illinois AM station and a Missouri FM station in which the Bureau proposed to revoke the stations’ licenses unless, within 60 days, the licensee pays the delinquent regulatory fees and interest, administrative costs, and penalties. According to the Order, the FCC’s records indicate that the stations currently have unpaid regulatory fee debt from fiscal years 2010, 2012, and 2013 totaling $13,121.32 for the AM Station, and totaling $11,828.38 for the FM station.
- The National Association of Broadcasters (NAB) released a report detailing the public safety importance of AM radio. In the report, the NAB explained that AM radio is an essential component of the nationwide Emergency Alert Service – especially given AM radio’s unique importance to communities of color and rural areas. For that reason, the NAB again urged Congress to pass the AM Radio for Every Vehicle Act (see our previous discussion of NAB’s position on the bill here), which would mandate the installation of AM radios in all new cars, including electric vehicles. As we discussed here, the bill has not mustered sufficient support in Congress to pass. See our discussion here regarding the bill, and its importance to the survival of AM broadcasting.
- Using the maximum fine permitted before the recent inflation adjustment (see here and here regarding our discussion of the FCC’s recent adjustments of fines for inflation), the FCC’s Enforcement Bureau issued two Notices of Illegal Pirate Radio Broadcasting to landowners in Hazelton, PA, and Newark, NJ, for allegedly allowing pirates to broadcast from their properties. The Bureau warned the landowners that the FCC may issue fines of up to $2,316,034 under the PIRATE Radio Act if the FCC determines that the landowners continued to permit any individual or entity to engage in pirate radio broadcasting from their properties.
