In July, in its effort to derail the new low-power FM (LPFM) service
through litigation, the NAB filed its brief with the U.S. Court of
Appeals for the D.C. Circuit. The brief was filed in the NAB's
previously submitted appeal to the court attacking the LPFM rules.
The NAB's brief argues to the Court of Appeals that the commission's
LPFM rules should be rescinded because the FCC was arbitrary and
capricious in adopting those rules. In general, a court of appeals
does not overturn the findings of an expert agency without making a
finding that the agency was arbitrary or capricious in some way in
reaching its decision.
The NAB's brief points to three specifics in making its argument.
First, when the FCC adopted the LPFM rules, it reversed its
long-standing policy that low-power services are an inefficient use
of spectrum, and it provided no explanation of that reversal. Second,
according to NAB, the commission disregarded evidence showing that
the implementation of LPFM would cause substantial interference to
existing FM service. Third, the commission has insisted that the
benefits of LPFM would outweigh any costs, but it has failed to
undertake a proper cost/benefit analysis.
The commission's brief addressing these arguments was due in early
August. Intervenors in the case, including the 50 state broadcast
associations and radio groups on the one side, and Media Access
Project on the other side, also had an opportunity to submit briefs
in August. On November 28, 2000, the court will hear oral arguments
on the issues raised and ultimately will issue a decision. In the
meantime, however, as the appeals process moves forward, there is no
stay on the LPFM rules adopted. Indeed, the FCC has proceeded with
plans for the filing of LPFM applications, with the first application
filing window having been opened from May 30 to June 8 for 12 states
and territories. More than 700 LPFM applications were filed during
that first window, and the commission will now process them. A second
window notice was scheduled for August 28 to September 1, for
Connecticut, Illinois, Kansas, Michigan, Minnesota, Mississippi,
Nevada, New Hampshire, Puerto Rico, Virginia and Wyoming.
Given the delays inherent in the appeals process, the first LPFM
applications could be granted, and the stations constructed, before
the Court of Appeals issues a ruling. While the proceeding is on an
expedited schedule, there will still be a time lapse between oral
arguments in November and a decision. If LPFM stations are in place
prior to the time the court reaches a decision, this fact might
increase the court's reluctance to overturn the LPFM rules.
Recent FCC fines
Fence enforcement. FCC agents visited stations in Virginia, Indiana
and Montana to inspect fences surrounding antenna towers. The federal
agents found unlocked gates, missing fence slats and broken hinges,
and levied the standard FCC fine for fence violations of $7,000. In
one case, an FCC agent found two gates unlocked during an evening
inspection and a gate unlocked two weeks later during a morning
inspection. The station advised the FCC that a painter it had hired
left the gate unlocked. However, the FCC held the station responsible
for those actions and issued the $7,000 fine. In another instance, an
FCC agent inspected a station and found that several slats were
missing in the fence surrounding the antenna. The agent determined
that the missing fence slats created an opening through which a
person could fit. Although the station advised the FCC that it was
not aware of the fence damage, it was held responsible. FCC rules
mandate that antenna towers having radio frequency potential at the
base must be enclosed within effective locked fences or other
Buyer and seller fined. To avoid a bank foreclosure on his station,
an FM station owner transferred promissory notes, equipment liens and
assets to a longtime station employee. The action staved off
foreclosure but created an unauthorized transfer of control. Both
parties pleaded with the FCC, stating that they had not obtained the
advice of counsel in attempting this unconventional action and that
they never intended the transfer to be a violation of the FCC rules.
Nevertheless, the FCC fined the station owner $8,000. The longtime
employee, also the new owner, was fined $8,000 as well.
FCC forms must be filed. The FCC fined the buyer of a station $3,000
for failing to submit forms to report his ownership. In this
transaction, as opposed to the one above, the FCC approved the sale
of a station in 1996 and the parties properly transferred the
station. However, the new buyer neither advised the FCC that the sale
had been completed (via a consummation letter), nor did he submit an
ownership report to disclose the station's new ownership.