3 fixes for Catch-22

FCC tries to resolve snag in radio-auction procedure

The FCC last week proposed three options for removing a roadblock to the auction of more than 500 radio licenses. At issue is a July court decision that bars the FCC from requiring noncommercial broadcasters to bid for the commercial licenses the government now requires to be auctioned.

To get around the dilemma, the FCC proposed:

  • Barring noncommercials from holding licenses on commercial portions of the band.
  • Permitting public broadcasters to obtain commercial frequencies only when there are no competing commercial applicants.
  • Providing opportunities to add new noncommercial FM and TV channels on a community-by-community basis.

Regardless of which proposals are picked, the FCC could find itself defending broadcast auction rules in court again. Depending on which way the commission goes, either National Public Radio (NPR) or commercial operators are likely to fight it.

The FCC also is asking Congress to fix the contradictory auction statute at the heart of the problem, but there's no guarantee that lawmakers can agree, given the lobbying prowess of both NPR and the National Association of Broadcasters.

"We've had plenty of discussions with Congress, but this is too important to just wait and see what happens," said FCC Chairman Michael Powell. He blamed the judges for a decision he said clearly contradicts any logical reading of congressional intent because it would give public broadcasters power to claim any new allotment for free. A resolution also is needed before the FCC can conduct auctions for new TV allotments.

On the FM band, where the most pressing problem lies, 20 channels are reserved for public broadcasters, which also may apply for licenses among the 80-odd frequencies slated for commercial use.

In the past, the FCC would decide which competing applicant would get a license, and mixed competing applications rarely presented a problem. Congress forced the FCC to issue permits to the highest bidder beginning in 1997.

FCC auction rules issued in 2000 required public broadcasters to bid for commercial allotments, but a federal appeals court ruled that literal interpretation of the 1997 law forbids the FCC from making noncommercial entities bid. Even if Congress intended to shield only allotments on the noncommercial band, the judges said "inartful drafting" is no reason to ignore a statute's clearest reading.