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In adopting a Notice of Proposed Rule Making late last week, the FCC took the first step in establishing ground rules for reimbursing Low Power Television, TV translator and FM radio stations affected by the TV spectrum repack. Most of the proposed rules track the statutory direction contained in the Reimbursement Expansion Act (REA) adopted in March, but a few potentially controversial proposals were included as well.

The REA limited reimbursement eligibility for LPTV, TV translators and FM radio stations to stations that were licensed and operating on April 13, 2017. In addition, LPTV stations must establish that they were broadcasting for nine of the twelve months prior to April 13, 2017, which was the date the Incentive Auction officially ended. The FCC is seeking comment on what evidence it should request from licensees to substantiate their eligibility, including potentially requiring licensees to provide program guides and/or power bills.

The FCC is also seeking comment on guidelines for reimbursing licensees, focusing on both the types of expenses that should be reimbursed, and the process for licensees seeking reimbursement. For example, the REA limited eligibility to those LPTV and TV translators that filed a Special Displacement application, so the FCC proposed to limit the reimbursable expenses to just those relating to the displacement of such stations.

While it is likely that no FM radio stations will be permanently displaced as a result of the Incentive Auction, the FCC developed a three-tier proposal to reimburse FM stations for expenses to operate auxiliary stations instead of temporarily ceasing operations while tower work is done. The FCC noted that its rules permit stations to either power down or temporarily discontinue operations for less than thirty days without seeking advance authority, so the FCC proposes to limit reimbursement for constructing new or upgraded FM auxiliary facilities to those stations that will be off-air for extended periods of times.

Under the proposal, FM radio stations off-air for more than 30 days would receive reimbursement for 100% of their expenses to construct or modify existing auxiliary facilities, but stations off-air between 11 and 30 days would receive reimbursement for only 75% of their expenses, and stations expected to be off-air for 1-10 days would receive reimbursement for only 50% of their expenses. To be eligible for reimbursement, FM auxiliary facilities will need to cover 80% of the existing station’s geographic or population coverage.

While the FCC obviously intends to borrow heavily from the existing reimbursement process used by Class A and full-power television stations, it is clear that there are unique circumstances surrounding the reimbursement of expenses for LPTV, TV Translator and FM radio stations that will require further examination. Moreover, Commissioner O’Rielly noted in his separate statement that the FCC has proposed to allocate reimbursement funds based on the length of time that FM radio stations will be off air, but urged parties to submit alternative proposals if the FCC’s assumption that “time equals money” is incorrect.

Comment deadlines have not yet been established, but comments on the FCC’s proposals will be due 30 days after the NPRM’s publication in the Federal Register, with reply comments due 30 days after that date.

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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:

Headlines:

  • Alaskan Licensee Faces Fines Over FM Station Silences
  • Enforcement Bureau Issues Consent Decrees for LED Billboard Violations
  • Tower Owner Hit for Unlit Structure

Cold Justice: Media Bureau Responds to Alaska Licensee’s Applications With Multiple Fines

The FCC’s Media Bureau issued two Notices of Apparent Liability (“NAL”) to an Alaskan licensee for repeated unauthorized silences and reduced power operations on its FM station and FM translator stations.  At the same time, the Media Bureau found an assignment application for one of the translators to be defective, and renewed the FM station’s license for only an abbreviated two-year term.

The FCC sets minimum operating schedule requirements for broadcast stations, and requires a station to transmit according to the “modes and power” specified by its license.  A station that expects to remain off-air for more than 30 days must request permission from the FCC.  However, Section 312(g) of the Communications Act of 1934 (“Act”), provides that a station’s license automatically expires if the station “fails to transmit broadcast signals for any consecutive 12-month period.”

In this case, the licensee originally applied for renewal of an FM license and three FM translator licenses in 2013.  The licensee also filed an assignment application to sell one of the translators up for renewal.

Several months later, another Alaskan broadcaster filed informal objections against all of the applications, alleging, among other things, that: (1) the applicant was delinquent on a debt from a previous enforcement action; (2) the applicant had failed to pay application fees for the translator license renewal applications; (3) all of the stations had been operating at low power or were off-air for extended periods of time (some for as long as 12 consecutive months); and (4) the assignment application was defective.  The objecting broadcaster also claimed the applicant lacked the character qualifications to hold a license.

The Media Bureau quickly dismissed various other claims made by the objecting broadcaster, including that (1) the licensee had not complied with the Emergency Alert System rules; (2) the licensee had violated the main studio rule; (3) the licensee had engaged in an unauthorized transfer of control; and (4) the proposed assignee did not actually exist.

In sorting out the remaining objections, the Media Bureau first determined that the applicant was not delinquent in its payments to the FCC.  Though the licensee had an unpaid Notice of Apparent Liability for Forfeiture from 2009, a licensee is not indebted to the FCC until (1) the fine has been partially paid, or (2) a court has ordered payment.  According to the FCC, the forfeiture never became payable because the license at the heart of the enforcement action had been cancelled shortly after issuance of the NAL and the Media Bureau therefore never issued a Forfeiture Order.

The Media Bureau did, however, find that the licensee had failed to pay license renewal application fees for the translator stations.  Though the applicant claimed that the translators in question were noncommercial educational (“NCE”) broadcast stations and thus exempt from the fee, the Media Bureau determined that the stations being retransmitted by the translators were commercial stations at the time of filing, and thus required a fee.  The Media Bureau also dismissed the assignment application, finding it procedurally defective because a single individual signed for both the assignor and assignee, in contravention of the FCC’s Rules.  Finally, the Media Bureau rejected the character claims, determining that the objecting licensee had failed to make a prima facie case for its claims of false certifications and false statements to the FCC.

Regarding the issue of whether the stations were silent or operated at variance from their licenses, the Media Bureau found that all of the stations were repeatedly silent without authorization for extended periods of time.  Although several of these silent periods lasted 364 days, none of the stations remained silent for the continuous 12-month period required for automatic expiration.  The Media Bureau did, however, find that the FM station had operated at reduced power for much of the most recent license period and beyond without authorization to do so.

Section 309(k) of the Act provides several criteria the FCC must consider when reviewing license renewal applications. The FCC will grant such an application if: (1) “the station has served the public interest, convenience, and necessity;” (2) the licensee has not committed any serious violations of the Act or the FCC’s Rules; and (3) the licensee has not committed any other violations of the Act or the FCC’s Rules that, taken together, would indicate a pattern of abuse.

Though the Media Bureau granted all of the translator license renewal applications, it proposed a $10,000 fine for discontinuing operations on the translator stations on five different occasions, a $20,000 fine for the FM station’s operation at reduced power without authorization, and mandated that the licensee pay the translator stations’ missing application fees along with a 25% late payment penalty.

The Media Bureau proceeded to note that the licensee’s failure to seek or maintain authorization for many of the FM station’s silent and reduced power periods constituted a “pattern of abuse” of the FCC’s Rules and that the FM station’s operational record failed to serve the “public interest, convenience, and necessity” during the most recent license term.  As a result, the Media Bureau granted a short-term renewal of the FM station’s license, providing only a two-year renewal rather than the standard eight year license term.

LED Astray: FCC Settles Multiple Investigations into Noncompliant Digital Billboards

The FCC entered into four separate consent decrees with LED sign manufacturers and marketers in the course of a single week after investigating whether the companies violated its equipment authorization rules.

Section 302(b) of the Communications Act restricts the manufacture, import, sale, or shipment of devices capable of causing harmful interference to radio communications.  To this end, the FCC regulates devices that emit radio frequency energy (“RF device”), including those that unintentionally generate signals that can interfere with other spectrum users.  RF devices must adhere to strict technical standards and various labeling and marketing requirements. Continue reading →

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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:

HEADLINES:

  • Media Bureau Hits Michigan Radio Station for Low Power Snafu
  • Online Retailer Faces $2,861,128 Forfeiture for Selling Unauthorized Drone Parts
  • Enforcement Bureau Issues Advisory on Drone Accessories

Weathering the Storm: Media Bureau Proposes Fine for Botched Low Power Operation

The FCC’s Media Bureau issued an $18,000 Notice of Apparent Liability for Forfeiture (“NAL”) to a Michigan radio licensee accused of omitting material facts from an FCC application and operating its station at variance from its license.

Under Section 312(g) of the Communications Act of 1934 (“Act”), a broadcast station’s license automatically expires after the station fails to broadcast for 12 consecutive months.  Section 73.1745(a) of the FCC’s Rules requires a station to broadcast according to the “modes and power” specified by its license, and Section 73.1765 permits licensees to request special temporary authority (“STA”) to operate at variance from their license for a limited time.

The licensee originally applied for renewal of its license in May of 2012.  Section 309(k) of the Act provides several criteria that the FCC must consider when reviewing license renewal applications.  The FCC will grant an application if: (1) “the station has served the public interest, convenience, and necessity;” (2) the licensee has not committed any serious violations of the Act or the FCC’s Rules; and (3) the licensee has not committed any other violations of the Act or the FCC’s Rules that, taken together, would indicate a pattern of abuse.

In February 2015 (while the renewal application was still pending), the licensee requested an STA to remain silent, claiming that his facilities would require significant repair after a broken water main flooded the studio.

The following month, the licensee of several religious broadcast stations filed an objection to the license renewal application, alleging that the broadcaster was “untruthful” about the circumstance of the flood.  It also claimed that the licensee had broken a contract between the two parties, “attempted to extort money” from a Texas broadcaster, and failed to pay money to another broadcaster.

In May 2016, the Media Bureau inquired into the length of time the licensee’s station had been silent.  The licensee responded that the station had returned to air shortly after the STA was filed, but a “clerical error” had prevented the licensee from notifying the FCC.  As evidence, the licensee provided sworn declarations, as well as bills and ad orders for another one of the licensee’s stations.  The licensee also indicated that the station was operating with a lower-powered transmitter than specified in the license due to a lightning-related power surge the previous year.

Unsatisfied, the Media Bureau sent the licensee a second letter demanding more information about the station’s operations.  The licensee responded with more information relating to the station in question, including a letter from an engineer which confirmed that while the station was licensed to operate at 50 kW, it was only operating at 1.4 kW.

That same day, the licensee requested an STA to operate at that reduced power level, stating that the station was “currently operating at the reduced power level of 1.4 kW” and needed to continue at this reduced power for the next 180 days.  The requested STA was not granted until over a year later.

The Media Bureau ultimately concluded that the station was operating with a “non-conforming” transmitter and at significant variance from its 50 kW authorization.  The Bureau also found that the licensee failed to timely request an STA to operate at that reduced power, and failed to disclose a material fact in its second STA request when it said that it was “currently operating” at the lower level despite having operated at that reduced power for over a year.  The NAL also indicated that it was “at best misleading” to suggest that the station would be back to full power within 180 days.  Section 1.17(a)(1) of the FCC’s Rules prohibits individuals from intentionally providing incorrect “material factual information” or intentionally omitting “material information that is necessary to prevent any material factual statement that is made from being incorrect or misleading.”

As a result, the Media Bureau proposed: (1) a fine of $10,000 for operating without the appropriate authorization for the service; (2) an additional $3,000 fine for failing to file a required form; and (3) a $5,000 fine for failing to disclose a material fact in the STA request.

Fortunately for the licensee, the Media Bureau did not find these acts to be “serious violations” or a pattern of abuse, and therefore granted the station’s license renewal application in a separate action.  In doing so, the Media Bureau denied the religious licensee’s objections, noting that the FCC does not adjudicate private contractual disputes.

Flight Delay: Online Drone Retailer Dinged for Marketing Dozens of Noncompliant Drone Parts

The FCC proposed a $2,861,128 penalty against a group of commonly-owned companies in the United States and Hong Kong for marketing unauthorized drone equipment.

Pursuant to Section 302 of the Act, the FCC regulates radio-frequency energy-emitting devices (“RF” devices) that can potentially interfere with radio communications.  The FCC sets limits on a device’s spurious emissions, transmission power, and on which bands it may operate.  Generally, noncompliant devices may not be imported, marketed or sold in the United States. Continue reading →

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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:

Headlines:

  • Louisiana Class A TV Station Settles Online Public File Violations for $50,000 Ahead of License Renewal
  • FCC and Michigan Teenager Enter Into Consent Decree After Misuse of Public Safety Communications System
  • Missouri Telco Agrees to $16,000 Settlement Over Unauthorized Transfers

When Violations Accumulate: Online Public File Violations Lead to $50,000 Settlement with the FCC

The FCC recently entered into a Consent Decree with a Louisiana Class A TV station licensee to resolve an investigation into the station’s failure to comply with its online Public Inspection File obligations.

Section 73.3526 of the FCC’s Rules requires licensees to timely place certain items in their online Public Inspection File relating to a station’s programming and operations.  For example, Section 73.3526(e)(11)(i) requires stations to place an issues/programs list in their Public Inspection File each quarter.  That document must list programs aired during the preceding quarter that are responsive to issues identified by the station as important to its community.  Section 73.3526(e)(11)(ii) requires broadcasters to quarterly certify their compliance with the commercial limits on children’s television programming.

Also on a quarterly basis, Section 73.3526(e)(11)(iii) requires stations to file a Children’s Television Programming Report detailing their efforts to air programming serving the educational and informational needs of children.  Section 73.2526(e)(17) similarly requires Class A TV stations to provide documentation demonstrating continued compliance with the FCC’s eligibility and service requirements for maintaining their Class A status.

When the broadcaster filed its license renewal application in February 2013, it disclosed that it had failed to comply with certain Public File requirements during its most recent license term.  Over the next year and a half, the FCC sent letters to the broadcaster requesting that it (1) upload the missing and late-filed documents and (2) provide an explanation for its failure to comply with the Rules.  The FCC did not receive a response until, in 2015, the broadcaster uploaded the required documents to its online Public File.

The broadcaster subsequently admitted that, since 2005, it had not prepared and would be unable to recreate 16 quarters worth of issues/programs lists.  The broadcaster also stated that it had failed to timely file dozens of other issues/programs lists, Class A certifications, Children’s Television Programming Reports, and children’s programming commercial limits certifications.

Under the terms of the Consent Decree, the broadcaster agreed to (1) admit its violations of the Rules; (2) pay a $50,000 civil penalty to the United States Treasury; and (3) implement and maintain a compliance plan to avoid future violations.  The compliance plan must remain in effect until the FCC finalizes its review of the broadcaster’s next license renewal application.  In return for the station’s timely payment, the FCC will end the investigation and grant the station’s pending license renewal application for a term ending in June 2021.

The next application cycle for broadcast license renewals begins in June 2019, and the FCC’s license renewal application form requires stations to certify that their Public Inspection File has been complete at all times during the license term, in compliance with Section 73.3526 (or Section 73.3527 in the case of noncommercial stations).

As the last radio stations moved their Public Files online in March of this year, missing and late-filed documents now can be easily spotted by the FCC, increasing the likelihood of penalties not just for Public File violations, but for falsely certifying Public File compliance in the license renewal application.  With that in mind, the FCC recently encouraged licensees to address Public File compliance issues as soon as possible to reduce the impact on upcoming license renewals.

Sounds Like Teen Spirit: Traffic Stop Results in Michigan Teenager’s Consent Decree for Misuse of a Public Safety Network

The Enforcement Bureau entered into a Consent Decree with a 19-year old amateur radio licensee who made unauthorized radio transmissions on the Michigan Public Safety Communications System (MPSCS).  The agreement concludes an investigation that began when Michigan State Police discovered a cloned radio device during a routine traffic stop.

Section 301 of the Act prohibits the transmission of radio signals without prior FCC authorization, Section 333 of the Act prohibits willful or malicious interference with licensed radio communications, and Section 90.20 of the Rules establishes the requirements to obtain authorization to use frequencies reserved for public safety uses.  In addition, Sections 90.403, 90.405, and 90.425 of the Rules set operating requirements for using these public safety frequencies. Continue reading →

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CommLawCenter readers may recall that the FCC adopted a rule in 2013 requiring broadcasters to present aurally on a secondary audio stream (“SAS”) all emergency information provided visually during programming other than during regularly-scheduled newscasts and newscasts that interrupt regular programming.

This “Audible Crawl Rule” went into effect on May 26, 2015, with a few exceptions.  Following a request from the National Association of Broadcasters, the FCC (1) temporarily waived the requirement to aurally convey information regarding school closings via the SAS pending further consideration in a Second Further Notice of Proposed Rulemaking and (2) extended the deadline to begin aurally describing inherently visual graphics, like Doppler Radar maps.  Consideration of the school closings requirement continues, and the FCC has twice extended the compliance deadline for inherently visual graphics.

In today’s Order, the FCC acknowledged that its aspirational reach continues to exceed the grasp of current technology, granting a joint petition from the American Council of the Blind, the American Foundation for the Blind, and the NAB for a five-year extension of the current waiver until May 26, 2023.  To monitor progress on achieving the desired visual-to-aural capabilities, the FCC also required that the NAB file a report with the Commission by November 25, 2020, the midpoint of the five-year extension period.  The report must “detail the extent to which broadcasters have made progress in finding accessible solutions or alternatives to providing critical emergency details generally delivered in a graphic format, as well as the extent to which this waiver continues to be necessary.”

The Media Bureau first granted an 18-month waiver of this requirement in May 2015, in response to an NAB request for a six-month waiver of the compliance deadline.  In 2016, the same coalition of organizations seeking this latest extension requested an additional 18 months to implement an automated approach for compliance with this part of the rule.  That extension would have expired tomorrow, May 26, 2018.

The FCC enacted the Audible Crawl Rule pursuant to the Twenty-First Century Communications and Video Accessibility Act of 2010, which requires broadcasters to make emergency information available to blind or visually impaired individuals.  Originally adopted in April 2013, Section 79.2(b)(2)(ii) of the FCC’s Rules requires all visual emergency information presented outside of newscasts to be made available via SAS.  The rule applies to visual content that is textual (such as on-screen crawls) and non-textual (graphic displays).  According to the FCC, the aural description of visual but non-textual information must be intelligible and must “accurately and effectively convey the critical details regarding the emergency and how to respond to the emergency.”  Continue reading →

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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 Proposes $235,668 Fine for Filing Untruthful Information
  • Major Phone Carrier Settles Dispute With FCC Over Rural Call Completion Issues for $40 Million
  • Repeat Pirate Nets $25,000 Fine

Tower Records: FCC Proposes Large Fine for Dozens of Falsified Tower Registrations

After a bizarre string of events involving unlit towers, falsified applications, and alleged theft, the FCC proposed a penalty of $235,668 against a Wisconsin holding company for providing false and misleading information on dozens of Antenna Structure Registration (“ASR”) applications and misleading an Enforcement Bureau agent.

Section 1.17 of the FCC’s Rules requires a party that is either (A) applying for an FCC authorization; or (B) engaging in activities that require such authorizations, to be truthful and accurate in all its interactions with the FCC.  Specifically, Section 1.17(a)(2) states that no person shall “provide material factual information that is incorrect or omit material information that is necessary to prevent any material factual statement that is made from being incorrect or misleading….”

In December 2016, the Enforcement Bureau began investigating an unlit tower in Wisconsin after the Federal Aviation Authority (the “FAA”) forwarded a complaint from a pilot who had noticed the structure.  Unlit towers pose a serious danger to air navigation.  In the midst of the investigation, the tower’s ASR information was changed to show a new company had taken control of the tower.  When an FCC investigator reached out to the newly registered owner, the company’s CEO stated that his company had recently acquired the tower, knew of the lighting problem, and would make repairs as soon as the weather permitted.  In the meantime, the company also began changing the registration information for other towers, requested flight hazard review from the FAA for some of these towers, and filed an ASR application for construction of a new tower in Florida.

Several months later, the original owner of the unlit tower informed the FCC that the other company was not actually the owner and that the imposter company’s “CEO” had improperly changed the ownership information for several sites in the ASR system.  The true owner also claimed that the alleged fraudster had changed locks and stolen equipment from several of the real owner’s towers—including the new lighting equipment that the original owner bought to repair the extinguished tower lighting.

In response, the Enforcement Bureau sent a Letter of Inquiry (“LOI”) to the claimed CEO’s physical and email addresses seeking more information about his various applications.  To date, the Bureau has not received any response.

In a Notice of Apparent Liability (“NAL”), the Enforcement Bureau determined that the CEO’s company became subject to Section 1.17 when it applied for the Florida tower registration, and also that the CEO was engaging in activities that require FCC authorization.  According to the NAL, the CEO apparently provided false and misleading information on 42 separate change in ownership applications and communicated false information to the investigating agent.  According to the Enforcement Bureau, the company also violated Section 403 of the Communications Act (the “Act”) by failing to respond to the LOI.

Under its statutory authority to penalize any party that “willfully or repeatedly fails to comply” with the Act or the FCC’s Rules, the FCC may issue up to a $19,639 forfeiture for each violation or each day of a continuing violation.  Accordingly, the FCC proposed a fine of $19,639 for each of the 10 apparently false applications filed in the past year, $19,639 for the company’s alleged misleading statements to the investigating agent, and an additional $19,639 for its failure to respond to the FCC’s questions, for a total of $235,688.

Missed Connections: Major Phone Carrier Agrees to Pay $40 Million After Investigation Into Rural Call Completion Issues

The FCC entered into a Consent Decree with a major phone carrier after an investigation into whether the carrier violated the Commission’s Rural Call Completion Rules.

According to the FCC, consumers in low-population areas face problems with long-distance and wireless call quality.  In an effort to address these problems, the FCC has promulgated a series of directives that prohibit certain practices it deems unreasonable and require carriers to address complaints about rural calling (“Rural Call Completion Rules”).

In 2012, the FCC’s Wireline Competition Bureau determined that a carrier may be liable under Section 201 of the Act for unjust or unreasonable practices if it “knows or should know that calls are not being completed to certain areas” and engages in practices (or omissions) that allow these problems to continue.  This includes (1) failure to ensure that intermediate providers (companies that connect calls from the caller’s carrier to the recipient’s carrier) are performing adequately; and (2) not taking corrective action when the carrier is aware of call completion problems. Continue reading →

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As those that receive our Pillsbury Client Advisories know (you can sign up for those here), April 10th was the deadline for placing various quarterly reports in your station’s public inspection file.  With many radio stations having shifted to an online public file on March 1st, this was the first quarterly deadline falling after that conversion.  As a result, consider this a friendly reminder that if you dutifully prepared your Quarterly Issues/Programs List a few weeks ago and then unthinkingly dropped it into the file drawer like you’ve done a hundred times before, you’ve got a problem.  The Quarterly Issues/Programs List that was required to be uploaded by April 10th details programming aired from January 1, 2018 through March 31, 2018 designed to serve the needs and interests of your station’s community.

If you generated a paper copy of the List, but forgot that it now must be uploaded, be sure to make a note of that fact and upload it as soon as possible.  Broadcasters are asked in their license renewal applications to certify that all documents have been timely placed in the public inspection file.  With the FCC’s public file database now logging the precise time a document is submitted, failing to properly disclose any late-filed documents is not only easy for the FCC to spot, but creates added risk for stations that falsely certify in their license renewal applications that the public file was complete at all times.  With license renewals occurring only once every eight years, even a few “oops” moments each year can soon begin to look like a “pattern of noncompliance” to the FCC.

There is, however, a very select group of stations that received a bye on the April 10 uploads.  The FCC announced this week that it was granting a small number of waiver requests filed by various stations seeking more time to meet the online public file deadline.  While these stations had sought relief from the requirement for varying periods of time, the FCC’s response was not so specialized.  It instead granted each of the stations seeking more time until June 23, 2018 (60 days from release of the Order) to comply with the online public inspection file requirement.

The FCC also made clear in the Order that it will not be providing such generalized relief in the future.  Going forward, any station seeking more time must provide information that demonstrates (1) the economic hardship the station would incur in complying with the online public file requirement; (2) the station’s technical inability to do so; or (3) another reason for a waiver as described in the 2016 Expanded Online Public File Order.

So if you are one of the select few stations that received a little extra time to move to an online public file, it’s your Second Quarter Issues/Programs List that will be the test of whether you have successfully moved to an online public file mindset.  For all other stations, your time is already up.

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Today the FCC publicly released a Report and Order eliminating TV stations’ annual obligation to report whether they have provided feeable ancillary or supplementary services on their spectrum during the past year unless they have actually provided such services.  The order was originally slated for discussion and a vote at next week’s FCC Open Meeting, but the Commission wound up adopting this widely supported change early, unanimously voting for it on circulation.

Previously, all digital television stations had to report by December 1 of each year whether they had provided feeable ancillary or supplementary services in the past year, what those services were, and then submit payment to the government of 5% of the gross revenue derived from such services.  Ancillary and supplementary services are any services provided on a TV station’s digital spectrum that is not needed to provide the single free over-the-air program stream required by the FCC.  The reason the word “feeable” is important is that broadcast video streams (i.e., multicast streams) do not trigger payment of the 5% fee.  Examples previously provided by the FCC of feeable ancillary and supplementary services include computer software distribution and data transmissions.

Observers had expected this rule change for a while.  In the spring of 2017, FCC Chairman Ajit Pai spearheaded the “Modernization of Media Regulation Initiative,” which aimed to institute a massive review of potentially outdated or irrelevant regulations affecting broadcasters, cable system operators, and satellite providers.  At Commissioner Michael O’Rielly’s urging, the Commission originally proposed today’s changes in a Notice of Proposed Rulemaking (NPRM) in October 2017.  The following month, the Media Bureau spontaneously waived the December 1, 2017 filing deadline for TV stations that had not provided feeable services over the prior twelve-month reporting period, signaling that the proposed rule change was likely coming.

Indeed, the FCC received broad support from commenters for the change.  In last year’s NPRM, the FCC noted that of 1,384 full-power commercial TV stations, fewer than 15 reported revenues from ancillary or supplementary services, netting the Commission around $13,000 in fees.

As a result, today’s Order amends Section 73.624(g) of the FCC’s Rules to require that only TV stations actually providing feeable ancillary or supplementary services need file the report in the future.  The FCC could find no justification for the immense expense incurred in having broadcasters submit, and the FCC collect and process, forms merely indicating the station hadn’t provided such services.  It wasn’t so much the FCC concluding that the expense outweighed the public interest benefit; it was the FCC being unable to point to a public interest benefit.

Which just makes you wonder just how this rule stayed in place for nearly 20 years, and no prior FCC bothered to ask that fundamental question.

 

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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 special issue takes a look at the government’s renewed efforts to scuttle Pirate Radio operations.

Since the government first began regulating the airwaves, it has struggled to eliminate unlicensed radio operators.  In its latest effort, the FCC is taking a hardline approach to this illegal behavior and is partnering with local and federal law enforcement, as well as Congress, to accomplish the task. While Chairman Pai has made clear that pirate radio prosecutions are once again a priority at the FCC, it is Commissioner O’Rielly who has been the most vocal on this front, calling for more aggressive action against unauthorized operators.  The continued prevalence of pirate radio operations has been chalked up to several factors, including insufficient enforcement mechanisms and resources, the procedural difficulties in tracking down unregulated parties, and lackadaisical enforcement until recently. Regulators and broadcast industry leaders have also expressed frustration with the whack-a-mole nature of pirate radio enforcement—shutting down one operation only to have another pop up nearby.

Real Consequences

Congress has also begun to take an interest in the issue, with the House Subcommittee on Communications and Technology holding a hearing last week discussing the subject.  One of the witnesses was David Donovan, president of the New York State Broadcasters Association.  In his testimony, he listed numerous risks that unlicensed operations present to the public, including failure to adhere to Emergency Alert System rules and RF emissions limits (which can be critically important where a pirate’s antenna is mounted on a residential structure).  Pirate operators also create interference to other communications systems, including those used for public safety operations, while causing financial harm to legitimate broadcast stations by diverting advertising revenue and listeners from authorized stations.

Despite these harms, pirate operations continue to spread.  This past month, the FCC issued a Notice of Unlicensed Operation (“NOUO”) to a New Jersey individual after the FCC received complaints from the Federal Aviation Administration (“FAA”) that an FM station’s broadcasts were causing harmful interference to aeronautical communications operating on air-to-ground frequencies.  FCC agents tracked the errant transmissions to the individual’s residence and confirmed that he was transmitting without authorization.

Days later, the FCC issued an NOUO to another New Jersey resident who was transmitting unlicensed broadcasts from a neighborhood near Newark Airport.  Once again, FCC agents were able to determine the source of the signal and found that the property owner was not licensed to broadcast on the frequency in question.

Continue reading →

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Yesterday’s enactment of the Consolidated Appropriations Act, 2018 (feel free to read it, it’s only 2,232 pages) was welcomed by broadcasters. If you’ve been following the trade press, you’ll know that’s largely because it not only added a billion dollars to the FCC’s fund for reimbursing broadcasters displaced by the spectrum repack, but for the first time made FM, LPTV and TV Translator stations eligible for repack reimbursement funds.

Continue reading →