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Pillsbury’s communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month’s issue includes:

  • Late-Filed License Application Garners $7,000 Fine
  • FCC Fines Noncommercial Broadcaster $5,000 for Alien Ownership Violation

“Inadvertent Error” Results in $7,000 Fine for West Virginia Broadcaster

The FCC recently issued a combined Memorandum Opinion and Order and Notice of Apparent Liability (the “Order”) fining a West Virginia FM broadcaster for unauthorized operation and failure to file a required form. The base fines associated with these types of rule violations total $13,000. However, based on the circumstances detailed below, the FCC decided to reduce the overall fine to $7000.

The licensing process begins with the grant of a construction permit and concludes with the grant of a station license authorizing permanent operation of the newly-constructed facilities. Pursuant to Section 73.3598(a) of the FCC’s Rules, construction must be completed within three years and a license application must be promptly filed with the FCC when construction is completed. Subsection (e) of this rule provides that a construction permit will be automatically forfeited upon its expiration if construction is not completed and a license to cover application has not been filed within the allotted three year period.

In the instant case, the FM broadcaster was forced to utilize an emergency antenna as a consequence of a 2002 tower collapse. In June 2004, the FM broadcaster sought to modify its station to relocate its authorized tower site to a location less than two miles away. As part of this process, the FM broadcaster filed an application for a construction permit. The FCC granted the application in July 2004 and issued a construction permit slated to expire in July 2007.

According to the Order, the FM broadcaster filed its license application in May 2011, almost four years beyond the expiration of the 2004 construction permit. The license application included a request for a waiver of Section 73.3598(e), indicating that the authorized construction had been completed by April 2006, well in advance of the three year expiration date, but that due to an “inadvertent error”, the license application was not filed prior to the construction permit’s July 2007 expiration.

In support of its waiver request, the FM broadcaster cited a May 2011 case in which the FCC had “affirmed the staff’s practice of waiving Section 73.3598(e) of the Rules in situations where the applicant conclusively demonstrates that it completed construction prior to the expiration of the construction permit, notwithstanding the tardy filing of the license to cover application.” In response, the FCC’s Order noted that the prior waivers occurred where the delay in meeting the deadline was “relatively minor”, as was the case in the cited May 2011 decision, where a license application was filed three days after the expiration of the construction permit. The FCC concluded that a four year delay could not be considered minor.

Ultimately, the FCC rejected the FM broadcaster’s waiver request, dismissed the license application, and on its own motion, granted the station special temporary authority to operate while it reapplied for a new construction permit. The FCC levied the full $3,000 fine for failure to timely file a license application, but reduced the unauthorized operation fine (for the period the station operated with modified but unlicensed facilities) from $10,000 to $4,000 since the station had previously held a valid license.

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In 2009, the FCC adopted an Order which expanded the types of commercial broadcast licensees required to file ownership reports on FCC Form 323 biennially. The FCC also established November 1 (of odd-numbered years) as the single national ownership report filing date for all commercial broadcast stations. As a result, all commercial full-power AM, FM, TV, and Class A and LPTV stations, as well as entities with attributable interests in those stations, were due to file their next biennial ownership reports on November 1 of this year. However, the Media Bureau issued an Order yesterday which moves the November 1, 2011 filing deadline to December 1, 2011. The FCC indicates that despite the change in filing date, the ownership reports should still include a snapshot of station ownership as it existed on October 1, 2011.

Keep in mind that the ownership report filing requirement does not apply to TV translators, FM translators, or low power FM stations. The FCC’s action also does not affect noncommercial stations, which continue to file their biennial reports on FCC Form 323-E by a filing deadline determined based upon the state in which they are licensed (rather than a single national date).

According to the FCC, the filing date was moved because “some licensees and parent entities of multiple stations may be required to file numerous forms and the extra
time is intended to permit adequate time to prepare such filings.” Despite providing the extra time, the FCC is still encouraging parties to prepare and file their ownership reports as soon as possible.

Having provided the extra filing time, the FCC will not be too pleased with broadcasters that fail to meet this new deadline. Broadcasters should therefore accept the FCC’s advice and try to avoid last minute ownership filings, which increase the likelihood of technical and other problems that can interfere with a successful filing.

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8/15/2011

The FCC has announced that full payment of all applicable Regulatory Fees for Fiscal Year 2011 must be received no later than September 14, 2011.

As of this date, the FCC has not released a Public Notice officially announcing the deadline for payment of FY 2011 annual regulatory fees. However, the FCC’s website indicates that the 2011 annual regulatory fees must be paid no later than 11:59 pm (EST) on September 14, 2011.

As reported in July 2010, beginning in 2011, the Commission has discontinued mailing assessment notices to licensees/permittees. It is the responsibility of each licensee/permittee to determine what fees are due and to pay them in full by the deadline. Information pertaining to the annual regulatory fees is available online at https://www.fcc.gov/fees/regfees.html.

Annual regulatory fees are owed for most FCC authorizations held as of October 1, 2010 by any licensee or permittee which is not otherwise exempt from the payment of such fees. Licensees and permittees may review assessed fees using the FCC’s Media Look-Up website – http://www.fccfees.com. Certain entities are exempt from payment of regulatory fees, including, for example, governmental and non-profit entities. Section 1.1162 of the FCC’s Rules provides guidance on annual regulatory fee exemptions. Broadcast licensees that believe they qualify for an exemption may refer to the FCC’s Media Look-Up website for instructions on submitting a Fee-Exempt Status Claim.

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As we reported previously, in an atypical display of unity among broadcasters and the cable industry, the parties found common ground and filed a Petition with the FCC seeking to extend the deadline for implementing the Common Alerting Protocol (CAP) standard.

Last week, that unified front continued when we filed a further extension request with the FCC on behalf of an even greater assembly of EAS Participants, including the State Broadcasters Associations, representing all fifty States and the District of Columbia, the National Association of Broadcasters, the Broadcast Warning Working Group, the National Cable and Telecommunications Association, the American Cable Association, National Public Radio, the Association of Public Television Stations, and the Public Broadcasting Service. The Petition asks the FCC to grant a further extension of at least 180 days beyond the current September 30, 2011 CAP compliance deadline, with the 180 days to run from the effective date of the Commission’s amendment of its Part 11 rules pursuant to its recently released Third Further Notice of Proposed Rulemaking. (Our discussion of the Third Further Notice can be found here).

In granting the earlier request for an extension of the CAP deadline, the FCC acknowledged that if it failed to extend the 180-day deadline, it could “lead to an unduly rushed, expensive, and likely incomplete process.” As a result, the Commission issued its Order giving EAS Participants until September 30, 2011, to acquire and install equipment able to accept CAP-formatted EAS messages.

In their Petition seeking a further extension of the CAP deadline, the broadcast and cable industries assert that a later deadline is warranted given the regulatory uncertainty that remains regarding CAP compliance. The Petition notes the nearly unanimous view of those who commented on the Third Further Notice that the deadline should be further extended because the FCC has not yet decided whether it will itself conduct EAS equipment certification in addition to the certification being done by FEMA. The Petition also notes that the Third Further Notice may lead to Part 11 rule changes altering the current obligations of EAS Participants in ways that would affect the purchase, installation and operation of new EAS equipment.

The Petition also states that a further extension will allow participants in the scheduled November 9, 2011, National EAS Test to focus their limited engineering resources on ensuring the success of the nationwide test. (We previously reported on the first National EAS Test here and here).

It remains to be seen whether a further extension will be granted, but if the Petition and the majority of comments recently filed in response to the FCC’s Third Further Notice in the EAS proceeding are any indication, EAS Participants — including broadcasters, cable operators and many others — feel strongly that a further extension of the deadline is essential.

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Pillsbury’s communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month’s issue includes:

  • FCC Increases Fine to $25,000 for Main Studio and Public File Violations
  • FCC Reaffirms $10,000 Public File Violation Against Student-Run Noncommercial FM Station

FCC Fines Texas Broadcaster $25,000 for Repeated Failure to Maintain Full-Time Personnel and to Make Available a Complete Public Inspection File

According to a recent Notice of Apparent Liability (“NAL”), the FCC proposed two fines totaling $25,000 against a Texas broadcaster for violations of Section 73.1125 (the “Main Studio Rule”) and Section 73.3526 (the “Public Inspection File Rule”) of the Commission’s Rules. The violations were discovered during three separate site visits over a two week period by an agent from the Enforcement Bureau’s Houston Field Office.

The Main Studio Rule establishes the requirements for a station’s main studio, including minimum staffing levels. The FCC requires that licensees maintain a “meaningful management and staff presence” at a station’s main studio. Based on a 1991 decision, the FCC defines “meaningful” as having at least one management level employee and one staff level employee generally present “during normal business hours.” The base forfeiture for violations of Section 73.1125 is $7,000. The Public Inspection File Rule requires broadcasters to maintain, and make available, certain material in their public inspection file, including a station’s current authorization, a current copy of the Public and Broadcasting manual, and a list of programs (“issues-programs list”) broadcast during each quarter of the license term that evidences the station’s most significant treatment of community issues. The base forfeiture for violations of Section 73.3526 is $10,000.

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As we reported last month, the federal government has decided to conduct the first-ever national test of the Emergency Alert System. On June 9, 2011, FEMA and the FCC announced that the nationwide test is scheduled to occur on November 9, 2011, at 2pm Eastern Standard Time.

In an effort to answer questions about the test, the FCC has launched a helpful “Emergency Alert System Nationwide Test” information page which can be found here. The page includes a countdown clock (117 days and counting!) and provides the who, what, when, where and why regarding the first national test.

Last month we also reported that the FCC has implemented a rulemaking proposing sweeping changes to the Part 11 EAS Rules in order to codify the obligation that EAS Participants begin formatting EAS messages using the Common Alerting Protocol (CAP). The FCC’s Third Further Notice of Proposed Rulemaking raises a host of questions, the most immediate of which is whether the current September 30, 2011 deadline for implementing CAP should be extended. For the vast majority of EAS Participants trying to meet that deadline, the answer to the FCC’s question appears to be a resounding “yes”. Among other issues, installing new EAS equipment just a month before the first national EAS test is likely to result in a national test beset by the “teething pains” of getting the new equipment functioning smoothly.

If you wish to respond to this or any of the other CAP-related questions being considered by the FCC, remember that comments are due at the FCC next Wednesday, July 20.

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In a setback for media interests, the United States Court of Appeals for the Third Circuit yesterday issued its Opinion in Prometheus Radio Project v. FCC (“Prometheus II“). The case focuses on the Federal Communications Commission’s most recent revisions to its media ownership rules, which were adopted in a 2008 Order (the “2008 Order“) concluding the FCC’s 2006 Quadrennial Regulatory Review.

The Prometheus II Opinion generally upheld those portions of the 2008 Order which retained the pre-2003 versions of the:

  • Radio/Television Cross-Ownership Rule
  • Local Television Ownership Rule, including the Top-Four Station and Eight Voices Tests
  • Local Radio Ownership Rule
  • Dual Network Rule

With respect to each of these rules, media interests had argued that the limitations were no longer necessary in the public interest as a result of increased competition, and that the FCC was therefore obligated under Section 202(h) of the 1996 Telecommunications Act to repeal or modify those regulations. The Third Circuit rejected those arguments and found the FCC’s analysis supporting a continuation of its pre-2003 ownership limitations to be reasonable, and not arbitrary, capricious, and/or unconstitutional.

The Third Circuit also remanded some portions of the 2008 Order to the FCC. First, the Third Circuit spent a considerable portion of the Opinion determining that the FCC failed to meet notice and comment requirements of the Administrative Procedure Act with regard to its decisions affecting the Newspaper/Broadcast Cross-Ownership (“NBCO”) rules. The court repeated at length criticisms raised by FCC Commissioner Copps and former Commissioner Adelstein and ultimately decided that these defects were so significant as to require that the NBCO rules be vacated and remanded to the FCC to be considered again as part of the 2010 Quadrennial Regulatory Review.

Also with respect to the NBCO rule, the 2008 Order had granted five permanent waivers of the rule to Gannett and to Media General. A group of public advocacy groups challenged those grants, but the Third Circuit held that the FCC had not been given an opportunity to pass on the arguments below and that the court therefore lacked jurisdiction to hear those challenges.

Finally, the Court ruled that the FCC failed to adequately address proposals to foster minority and female ownership of broadcast media in the 2008 Order and the related Diversity Order. It particularly criticized the FCC’s use of SBA criteria in determining whether a party was an “eligible entity” under the failed station solicitation rule adopted in the 2008 Order, and its failure to give adequate consideration to proposals from interest groups to limit eligibility to socially and economically disadvantaged businesses. As a result, this ruling was also vacated and remanded to the FCC.

From here, the FCC will now have to address the items that the Third Circuit has remanded to it. In addition, the FCC is again considering its multiple ownership rules in conjunction with its 2010 Quadrennial Regulatory Review. Therefore, the ball is yet again in the FCC’s court.

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By: Scott R. Flick and Christine A. Reilly

The next Quarterly Issues/Programs List (“Quarterly List”) must be placed in stations’ local public inspection files by July 10, 2011, reflecting information for the months of April, May and June, 2011.

Content of the Quarterly List

The FCC requires each broadcast station to air a reasonable amount of programming responsive to significant community needs, issues, and problems as determined by the station. The FCC gives each station the discretion to determine which issues facing the community served by the station are the most significant and how best to respond to them in the station’s overall programming.

To demonstrate a station’s compliance with this public interest obligation, the FCC requires a station to maintain, and place in the public inspection file, a Quarterly List reflecting the “station’s most significant programming treatment of community issues during the preceding three month period.” By its use of the term “most significant,” the FCC has noted that stations are not required to list all responsive programming, but only that programming which provided the most significant treatment of the issues identified.

Given the fact that program logs are no longer officially mandated by the Commission, the Quarterly Lists may be the most important evidence of a station’s compliance with its public service obligations. The lists also provide important support for the certification of Class A TV station compliance that is discussed below and which must be produced by Class A TV applicants and licensees.

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By Lauren Lynch Flick and Christine A. Reilly

The next Children’s Television Programming Report must be filed with the FCC and placed in stations’ local Public Inspection Files by July 10, 2011, reflecting programming aired during the months of April, May and June, 2011.

Statutory and Regulatory Requirements

As a result of the Children’s Television Act of 1990 and the FCC Rules adopted under the Act, full power and Class A television stations are required, among other things, to: (1) limit the amount of commercial matter aired during programs originally produced and broadcast for an audience of children 12 years of age and younger; and (2) air programming responsive to the educational and informational needs of children 16 years of age and younger.

For all full-power and Class A television stations, website addresses displayed during children’s programming or promotional material must comply with a four-part test or they will be counted against the commercial time limits. In addition, the contents of some websites whose addresses are displayed during programming or promotional material are subject to host-selling limitations. The definition of commercial matter now include promos for television programs that are not children’s educational/informational programming or other age-appropriate programming appearing on the same channel. Licensees must prepare supporting documents to demonstrate compliance with these limits on a quarterly basis.

Specifically, stations must: (1) place in their public inspection file one of four prescribed types of documentation demonstrating compliance with the commercial limits in children’s television; and (2) complete FCC Form 398, which requests information regarding the educational and informational programming aired for children 16 years of age and under. The Form 398 must be filed electronically with the FCC and placed in the public inspection file. The base forfeiture for noncompliance with the requirements of the FCC’s Children Television Programming Rule is $10,000.

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Hope everyone had a great July 4th! With the long weekend now behind us, I wanted to remind readers that July 10th represents a significant filing deadline for radio and television stations. Below is a brief summary of the quarterly deadlines, as well as links to our Client Alerts describing the requirements in more detail.

Children’s Television Programming Documentation

All commercial full-power television stations and Class A LPTV stations must prepare and file with the FCC a Form 398 Children’s Programming Report for the second quarter of 2011, reflecting children’s programming aired during the months of April, May, and June, 2011. The Form 398 must be filed with the FCC and placed in stations’ public inspection files by July 10, 2011.

In addition to requiring stations to air programming responsive to the educational and informational needs of children, the FCC’s rules limit the amount of commercial material that can be aired during programming aimed at children. Proof of compliance with the children’s television commercial limitations for the second quarter of 2011 must also be placed in stations’ public inspection files by July 10, 2011.

For a detailed discussion of the children’s programming documentation and filing requirements, please see our Client Alert here.

Quarterly Issues Programs Lists

The FCC requires each broadcast station to air a reasonable amount of programming responsive to significant community needs, issues, and problems. Radio and television broadcast stations, whether commercial or noncommercial, must prepare and place in their public inspection files by July 10, 2011, a list of important issues facing their communities, and the programs which aired during the months of April, May, and June, 2011 dealing with those issues. For a detailed discussion of these requirements, please see our Client Alert here.