Federal Forms Lag Freezes New Deals

Many station transactions are locked up, awaiting FCC reprints to free them

A backlog of new commercial-broadcast-station deals at the FCC is expected to last at least another month, until federal bureaucracies create and approve new application forms reflecting the changes to industry ownership rules approved by the FCC June 2.

Of course, if a current congressional effort to undo those changes succeeds, the FCC may have to come up with even newer forms.

The Paperwork Reduction Act requires application forms and other filings that the federal government requires individuals and businesses to submit be approved by the Office of Management and Budget to prevent overly burdensome administrative obligations. Although the mandate might cut down on paperwork burdens in the long run, it also creates short-term stoppages of normal government business during the lag between re-creating the OMB-approved forms and publishing them in the Federal Register.

The freeze will affect radio primarily, because there are a lot more stations and a steady stream of deals. Yearly, the FCC processes 2,500 radio-station sales. Currently, roughly 300 radio deals are pending. In television, where the relatively smaller amount of stations already reduces the number of swaps, anticipation of significant changes to ownership rules has further slowed the pace of deals, so relatively few are being held up.

The FCC will not submit the new application forms to OMB until the final text of the rule changes is made public, according to an agency spokeswoman. Even though the commission approved the rules three weeks ago, the Media Bureau staff needed extra time to incorporate last-minute revisions by the five commissioners into the original draft. The text was expected to be made public late last week.

The application forms in question are FCC Forms 314 and 315, which cover radio and TV transfers of control, and Form 301, which covers license modifications, such as changes to power levels and coverage areas. Short-form 316, which covers corporate restructuring, such as transfers from subsidiaries to holding companies, has escaped the freeze and will continue to be processed.

The freeze does not apply to noncommercial stations.

After forms are published, parties may file new applications but only if the deals comply with the new multiple-ownership rules or are accompanied by "adequate showing" that a waiver of the new rules is warranted.

Because the rule changes also affect deals pending at the time of the order, amended applications must be submitted either demonstrating compliance or requesting waivers. Forms for amended applications are expected to be available prior to forms for new applications, perhaps within three weeks.

Changes that must be reflected in the forms, include a TV buyer's compliance with the 45% cap on national broadcast TV-household reach and with relaxed limits on single-market duopolies, triopolies and crossownership with newspapers and radio stations.

In radio, applicants must demonstrate compliance with new market-measurement methods that effectively reduce the number of stations one company can own in some small markets.