New FMs on the Block

Hundreds of new FM stations are closer to the auction block, but noncommercial broadcasters may not be happy with the result. The FCC is wrapping up negotiations over issuing new licenses when both commercial and noncommercial broadcasters apply for a channel. Uncertainty over handling these competing applications has stalled auctions of 540 new FM allotments and 1,650 low-power TV and translator permits.

The dilemma stems from a 2000 court order forbidding the FCC from requiring noncommercial stations to bid on channels in the commercial band. The ruling put the FCC in a quandary because Congress ordered that all new commercial licenses be awarded to the highest bidder. Because nonprofit applicants routinely compete with commercial applicants for licenses, no auction can proceed until the FCC figures out how to resolve competing applications between commercial and nonprofit broadcasters.

The FCC commissioners have reached a ruling, and the decision could be issued as soon as this week. Broadcast sources suggest it will be largely unfavorable to noncoms.

Some predict the FCC will prevent nonprofit applicants from seeking allotments outside of channels reserved for noncommercial stations. To soften the blow, the FCC would ease procedures for reserving additional spectrum for noncommercial broadcasters.

National Public Radio Associate General Counsel Gregory Lewis wouldn't predict the result but conceded that the commissioners are struggling to find a way to help noncommercial stations and still comply with the court's order. "They have been sympathetic to our dilemma," he said, "but feel constrained by the law."

Officially, the FCC has been considering three options: barring noncommercials from new commercial-band licenses; allowing them on those channels only when no for-profit applicants apply; or accommodating noncommercials on a community-by-community basis.

A portion of the FM band, between 88 and 92 MHz, is reserved for noncommercial stations, although nonprofits have always been allowed to apply for channels outside it.

Unfortunately for public broadcasters, there are few open allotments on the reserved part of the FM band, and neither AM nor television has space reserved for noncoms. Thus, all public broadcasters have little choice but to vie with commercial broadcasters for new channels.

In television, public broadcasters have established 13 full-power stations on non-reserved channels, and more than 800 translators that allow them to reach 12 million viewers who can't be reached by stations' main transmitters.

The translators are largely on ch. 52-59, which broadcasters must give up as part of the government's reclamation of analog channels. The Association for Public Television Stations is concerned that new translators won't be available in core ch. 2-50 unless noncommercials are given some preference. "Helping noncommercial stations maintain access to translators is critical," said Lonna Thompson, APTS corporate counsel.

Today's dilemma surfaced in 1997 when Congress threw out the FCC's decades-old comparative-hearing process that subjected commercial license applicants to several rounds of meetings with agency officials before the regulators would pick one they felt would best serve the public interest.

Instead, lawmakers ordered the FCC to put commercial channels out for bid when there is more than one commercial applicant. Commercial broadcasters and lawmakers praised the law because it eliminated an expensive bureaucratic hassle, not to mention promising to raise funds for the federal Treasury.

Congress exempted channels reserved for financially strapped nonprofit operators but did not address how to resolve applications for commercial spectrum when one of the applicants is a nonprofit. FCC's auction rules of 2000 required public broadcasters to bid for commercial allotments, but federal appeals judges ruled the next year that noncommercials could not participate in auctions.