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Fourth Report and Order

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This Report and Order is the first of three that implements the provisions of the Local Community Radio Act of 2010 (LCRA). This Order addresses LCRA Section 5 which relates to the relationship between LPFM stations, FM Translator stations and FM booster stations. This Order also addresses the use use of FM translators to rebroadcast AM stations and addresses the trafficking of FM Translator construction permits following the end of the Auction 83 "Great Translator Invasion" filing window. This Report and Order was released together with the Third Order on Reconsideration and released on the same day as the Fifth Report and Order, the Fourth Order on Reconsideration and the Fourth Further Notice of Proposed Rulemaking.

Fourth Report and Order
Document Information
TypeReport and Order
Docket Number(s)MM 99-25
FCC Number12-29
FCC Record27 FCC Rcd 3364
Federal Register Citation(s)77 FR 21002
Federal Register Date(s)April 9, 2012
Relevant Dates
Adoption DateMarch 19, 2012
Release DateMarch 19, 2012


Issues discussed

LCRA Section 5 - Broad Interpretive Principles

Overview

In the Third Further Notice of Proposed Rulemaking, the FCC interpreted Section 5 of the LCRA to establish the following broad principles:

  • Section 5(1) requires the Commission to adopt licensing procedures that ensure some minimum number of licensing opportunities for both LPFM and translator services across the nation.
  • Read together with Section 5(2), Section 5(1) requires the Commission to provide licensing opportunities for both services in as many local communities as possible.
  • A tentative conclusion that the FCC's primary focus under Section 5(1) must be to ensure that translator licensing procedures do not foreclose or unduly limit future LPFM licensing, because the more flexible translator licensing standards will make it much easier to license new translator stations in spectrum-limited markets than new LPFM stations.

Overall, there was broad support to eliminate the cap of 10 translator applications (10-cap) and using market-specific spectrum availability metrics to implement Section 5. There were differing arguments from LPFM and FM Translator proponents on how Section 5 should be implemented.

Comments received

Section 5(1) - Ensuring licenses are available

LPFM advocates supported the FCC's view that Section 5(1) requires that the FCC ensure that the processing of FM translator applications does not preclude future opportunities for new LPFM licenses. LPFM supporters contend that Congress intended that the Commission take existing licenses into account when assessing whether its licensing procedures would ensure that licenses are available rather than establish a “going forward” only standard that ignores legacy licensing. LPFM advocates also argue that Section 5(1) requires the Commission to preserve a significant number of licensing opportunities for new LPFM stations in all markets where this is possible.

Translator supporters disagree with these positions. These commenters oppose an interpretation of Section 5(1) that, in their view, would favor LPFM stations over translators and urge the Commission not to devise licensing procedures to redress perceived imbalances in past licensing. National Public Radio (NPR) argues that our proposal unduly favors future LPFM service at the expense of the pending FM translator applicants by taking into account the number of existing LPFM and translator stations. NPR also argues that “ensuring that licenses are available” includes current and future FM translator station applicants. Similarly, Educational Media Foundation notes that the LCRA never “directly” references applications from Auction 83, and emphasizes Congress’ use of “new” at the beginning of Section 5 to argue that Section 5(1) “requires that ‘new’ licenses for both translators and LPFM stations be made available.” The National Association of Broadcasters argues that a policy of dismissing translator applications where translators but not LPFM stations could be located would counter Section 5(1)’s mandate that licenses be available for translator stations.

Section 5(2) - Assessing the needs of the local community

LPFM advocates suggest that Section 5(2) should be interpreted as a mandate favoring localism, and in particular LPFM stations, which they argue provide the greatest localism benefit of any broadcast service. Indeed, commenters note that the LPFM service was established in part to address the perceived loss of local programming during a period of significant radio consolidation. Some parties argue that translators, which do not originate programming, fail to serve local community needs24 and are not truly local, while LPFM stations better serve the goals of localism. LPFM proponents also suggest that, when making licensing decisions, the Commission could address the needs of local communities by considering demographic data. Specifically, they argue that urban communities, well served by commercial and noncommercial services, have less need for translator services and more need for local community-level programming, while rural communities, poorly served by full-service facilities, have need for both translators and LPFM stations.

Translator advocates argue that translators can serve the needs of the local community and note that the Commission and Congress have found that to be the case. For example, translators can provide emergency information, as well as regional and state news. Translators can also serve the local community by providing a format not currently available in that area. Thus, they argue it is wrong to assume that LPFM stations better serve local community needs than do translators. NPR criticizes our analysis of Section 5(2) on the ground that we focused on the differences between translators and LPFM stations, rather than focusing on how both services serve the needs of the local community by expanding the programming choices available to listeners. NPR also argues that some communities might actually have a greater need for a translator than for an LPFM station because a translator may be filling a coverage gap for a significant full-power station. Common Frequency replies that urban communities served by multiple translators have more need for a first LPFM station.

Section 5(3) - Equal in Status

Translator proponents argue that, for regulatory purposes, the terms “stations” and “applications” are interchangeable. Translator proponents argue that either changing the Commission’s market-based approach or waiving the cut-off rules in favor of future-filed LPFM applications would not be consistent with Section 5(3). Mullaney Engineering argues that the services are not “equal in status” if LPFM applicants are allowed to invalidate the cut-off protection rights of previously-filed translator applications. NPR likewise believes that waiving cut-off rules to give preference to later-filed LPFM applications would violate the “equal in status” mandate. Other translator supporters express concern that this approach would disproportionately favor the licensing of future LPFM stations and thereby violate Section 5(3)’s equal in status mandate. They claim that trying to make LPFM and translators equal in numbers would suppress translator licensing and artificially encourage unwanted LPFMs.

LPFM supporters disagree, arguing that, while the grant of a station license conveys certain vested and statutorily protected interests to a licensee, those interests do not attach to a pending application. Prometheus Radio Project argues that Section 5(3) does not refer to the cutoff rule, but instead merely requires that translators and LPFM stations be secondary to full service stations and equal to each other. Prometheus further asserts that Section 5(3) does not prohibit the Commission from giving LPFM applicants priority over translator applicants, particularly when read in the context of Section 5(2)’s requirement that licensing serve the needs of local communities and Section 307(b)’s requirement that the Commission distribute radio service in the public interest.48 Prometheus states that the Commission should balance the two services by aiding in the development of LPFM. Other LPFM advocates argue that the cut-off protection rule is a regulatory custom that the Commission can waive if it serves the public interest. Some commenters argue for giving LPFM stations priority because translators consume valuable radio spectrum while failing to provide original local programming. LPFM advocates also argue that the Commission must compensate for the “head start” that the translator service has to the comparatively new LPFM service. Commenters further argue that the current rules favor translators. Some suggest that, in order to achieve a true equality between the LPFM service and translators, the technical rules governing the LPFM service should be changed to match those of translators. Common Frequency contends that Section 5(3) calls for a goal of equal spectrum for each service.

Analysis

The FCC adopted their interpretations of the three Section 5 licensing standards proposed in the Third Further Notice. This included:

  • Including existing LPFM and FM translator stations when determining if licenses are available.
  • That LPFM and FM Translator licenses be available in as many local communities as possible.
  • To ensure that translator licensing procedures do not foreclose or unduly limit future LPFM licensing recognizing that translator licensing is more flexible.
  • Differing procedures for translator processing and dismissal based on existing spectrum crowding conditions.
  • Translator dismissals should not take place in situations where LPFM stations cannot be licensed.
  • The 10-cap policy established prior to the LCRA is inconsistent with Section 5.
  • Section 5(3) prohibits the FCC from waiving the "cut-off" rule for LPFM stations (where an LPFM can file for a channel without regard of short-spacing to proposed FM translators).

Implementing LCRA Section 5

Overview

Having tentatively concluded that the 10-cap dismissal policy would run contrary to the LCRA’s mandate, the FCC considered three alternative processing regimes and tentatively concluded that a market-specific, spectrum availability-based translator application dismissal policy would most faithfully implement Section 5 of the LCRA. To determine LPFM opportunities in major markets, the Media Bureau undertook a nationwide LPFM spectrum availability analysis. The Media Bureau studied all top 150 radio markets, as defined by Arbitron, and smaller markets where more than four translator applications are pending. It centered a thirty-minute latitude by thirty-minute longitude grid over the center-city coordinates of each studied market. Each grid consisted of 961 points – 31 points running east/west by 31 points running north/south. The Media Bureau analyzed each of the 100 FM channels (88.1~107.9 MHz) at each grid point to determine whether any channels remained available for future LPFM stations at that location. Only channels that fully satisfied co-, first- and second adjacent channel LPFM spacing requirements to all authorizations and applications, including pending translator applications, were treated as available. The area encompassed by the grid was designed to approximate “core” market locations that could serve significant populations. The results of that analysis were presented in the Third Further Notice, and identified the number of channels (“LPFM Channels”) currently available for LPFM use in each studied market.84 In calculating “available” LPFM channels, it included both the identified vacant channels and those channels currently licensed to LPFM stations which are authorized to operate at locations within each market’s thirty-minute latitude by thirty-minute longitude grid.

The FCC proposed to dismiss all pending applications for new FM translators in any market in which the number of available LPFM Channels was below a specified LPFM channel floor (a “dismiss all” market), and to process all pending applications for new translators in markets in which the number of available LPFM channels met or exceeded the applicable LPFM channel floor (a “process all” market).86 In proposing the channel floors, the FCC was guided by the number of top 150-market NCE FM full power stations, noting that this service was most comparable to the LPFM service.

Proposed LPFM Channel Floors
Market Rank LPFM Channels
1~20 8
21~50 7
51~100 6
101~150 as well as smaller markets where more than 4 translator applications are pending. 5

The FCC sought comment on the methodology of its study, and whether a market-tier approach was a reasonable means for effectuating both Section 5(1) and 5(2) directives. It also sought comment on whether use of Arbitron market-based assessments as used therein was reasonable for purposes of implementing Section 5 of the LCRA, and tentatively concluded that a market-based analysis would provide a reasonable “global” assessment of LPFM spectrum availability in particular areas. It sought comment on whether defining the Section 5(2) term “local community” in terms of markets was reasonable and whether it was appropriate to use the same definition for LPFM and translator purposes.

The FCC also sought comment on whether it should impose restrictions on the translator settlement process in the “process all” markets to ensure that engineering solutions to resolve application conflicts would not reduce the number of channels available for LPFM stations in these markets. Finally, in order to preserve the status quo during the pendency of this proceeding, it proposed to suspend the processing of any translator modification application that proposes a transmitter site for the first time within any market that has fewer LPFM channels available than the proposed channel floor. It also imposed an immediate freeze on the filing of translator “move-in” modification applications and directed the Bureau to dismiss any such application filed after the adoption of the Third Further Notice. It noted that the freeze would continue until the close of the upcoming LPFM filing window, but would not apply to any translator modification application which proposes to move its transmitter site from one location to another within the same spectrum-limited market. It sought comment on these proposals.

Defining the market and channel floors

Prometheus and other LPFM proponents suggest that the Commission analyze the top markets using a smaller grid (21x21), arguing that the 31x31 grid studies an area “far too large to adequately evaluate spectrum availability in most urban areas.” Prometheus and REC Networks each note that many available LPFM opportunities are located in sparsely populated (or unpopulated) areas on the fringe of the 31x31 grid. LPFM advocates likewise urge the Commission to separately evaluate named cities in hyphenated Arbitron markets, to set higher channel floors, to count only channels (and not locations) as counting toward a channel floor, and to only count new licensing opportunities when assessing LPFM channel availability.

Translator advocates largely disagree with these suggestions. NPR and NAB assert that a 21x21 grid “provides a skewed analysis of market conditions” and would violate the LCRA mandate that the two services remain equal in status because it would result in the dismissal of more translator applications. Indeed, they maintain that even the Commission’s proposed 31x31 grid is too small and argue that use of Arbitron market boundaries would provide a more accurate measure of current LPFM and FM translator station locations and potential LPFM licensing opportunities. EMF and other translator proponents likewise disagree with Prometheus’s view that only channels should apply to the channel floors, maintaining that potential “locations” for LPFM stations should also count. By looking solely at channels, EMF maintains that the Commission is understating the number of potential LPFM stations that could actually be constructed in the market. It argues that if LPFM is truly a localized service to small populations, channel re-use within a market is “to be expected.”

Translator amendment and settlement procedures

In “Dismiss All” Markets. NAB and others assert that we should process translator applications where an application grant would not obstruct a particular LPFM opportunity or where a dismissal would not create an additional LPFM opportunity. LPFM advocates oppose these suggestions. With respect to the former, they argue that this proposal in practice would likely result in the loss of significant LPFM licensing opportunities. With respect to the latter, they argue that the second-adjacent waiver process will create many LPFM opportunities in markets that otherwise appear to have no available LPFM channels (such as New York and Chicago). Common Frequency further urges the Commission to take into account LP-10 availability and the potential for intermediate frequency (“I.F.”) and second adjacent channel waivers in determining whether a particular translator application could preclude an LPFM licensing opportunity.

In “Process All” Markets. NPR and others argue that the Commission should not restrict the ability of pending translator applicants to make minor amendments to their applications, arguing that circumstances may have changed considerably since their applications were filed in 2003. NAB argues that the Commission should allow applicants to choose other channels as part of the settlement process, so long as the availability of LPFM opportunities is not reduced below the LPFM channel floor for that market. It does not, however, propose procedures to select among competing translator applicants while also safeguarding the pertinent LPFM channel floor. It notes that in many “process all” markets, the number of available LPFM channels far exceeds the channel floor. LPFM advocates disagree, arguing that the “availability of settlements negates the FCC’s systemic approach to defining clear channel floors.” Common Frequency maintains that the availability of settlements “provides for an open-ended scenario where translator applicants could effectively cherry-pick the best channels, leaving the channels at the edges of the grid-area for LPFM applicants.

Analysis

"Spectrum available" and "spectrum limited" markets

The FCC adopted, with certain modifications, the market-specific processing approach outlined in the Third Further Notice. As previously discussed, the FCC's principal challenge in effectuating Section 5(1) of the LCRA is to identify and preserve those LPFM licensing opportunities where few or no LPFM stations currently operate. The processing approach adopted furthers this goal by ensuring that LPFM licensing opportunities in spectrum-limited markets remain “available.” At the same time, the adoption of translator application and amendment procedures that will permit the immediate licensing of certain pending translator applications in both “dismiss all” and “process all” markets, consistent with Section 5(1) and 5(2) directives and the procedures set forth below.120 To conform our terminology to the revised processing standards, the FCC used the names “spectrum limited” and “spectrum available” markets to refer to what were previously characterized as “dismiss all” and “process all” markets, respectively.

Size of the market area being evaluated

The area used to count current stations and spectrum availability was based on a grid of "channel points" that are spaced 31 minutes of latitude by 31 minutes of longitude (31x31) with the reference coordinates for the market's city being in the center of the grid. In cases where a large concentration of the total population of the 31x31 grid was in a smaller grid area of 21 minutes latitude by 21 minutes longitude (21x21) centered on the market city's reference coordinates, then the 21x21 grid could be used for consideration of the market evaluation.

The FCC reviewed their grid studies and have determined that in some smaller “spectrum available” markets, many of the channels identified as available for LPFM are on the fringe of the 31x31 grid in unpopulated or very lightly populated areas. Indeed, in some cases, the population of the 21x21 grid represents more than 90 percent of the population of the 31x31 grid. They believed that LPFM stations can best serve the needs of local communities in areas with significant populations where LPFM service is practical and sustainable. Accordingly, they find that adoption of a smaller grid is appropriate in certain markets to compensate for low population levels on the outer fringes of the grid. They believed that use of a smaller grid in these markets will more faithfully implement Section 5(2) of the LCRA than our original proposal because it identifies and preserves LPFM opportunities in core city areas, where the LPFM service can best serve community needs. The FCC found that this revised approach is more faithful to our interpretation of Sections 5(1) and 5(2) of the LCRA. As previously set forth, these sections, when read together, requires the FCC to ensure a certain level of future LPFM licensing in “spectrum available” markets. However, they believed that licensing opportunities identified as “available” in these smaller markets should be limited to those locations that are likely to be able to support viable LPFM stations. The adoption of a 21x21 grid in certain markets will enable the FCC to more accurately identify such opportunities.

Counting existing stations in the market

Different considerations apply to the largest markets. The FCC's analysis establishes that there are few or no LPFM licensing opportunities within the core areas of most of the top 50 markets, especially when compared to the number of licensed translator stations and the number of pending translator applications in these markets. The FCC determined that only seven of the top 50 markets which are classified as “spectrum limited” exhibit the high population concentrations within the grid that occur in a number of smaller markets. That is, based on both raw population numbers and population distributions, the largest markets are more likely to include population centers outside core market locations that LPFM stations could serve. Thus, the FCC finds that their translator processing procedures must not preclude LPFM licensing opportunities beyond the studied 31x31 grids in the top 50 spectrum limited markets.

The FCC modified the LPFM spectrum availability study set forth in the Third Further Notice as follows. As before, they identified the number of available LPFM channels and licensed stations within the 31x31 grid and compared this number to each market’s channel floor. Then, they analyzed “spectrum available” markets to identify those where 75 percent or more of the total population in the 31x31 grid is located in the 21x21 grid. In these markets, the smaller grid contains the concentrated core population, they used the smaller grid to determine both the number of licensed stations and the number of channels available for future LPFM stations. Thus, “spectrum available” markets are those markets in which the number of LPFM channels within the applicable grid meets or exceeds the market’s channel floor. The FCC did not subject the 31x31 “spectrum limited” markets to the 21x21 population threshold test for several reasons. First, any such market would necessarily remain a “spectrum limited” market on the basis of a 21x21 grid analysis. More importantly, the 31x31 grid analysis in each of these markets establishes that few opportunities remain within the larger grid for new LPFM stations. Thus, the FCC found that it was necessary that our “spectrum limited” market translator application processing rules, as described below, protect all of the limited LPFM licensing opportunities within the larger grid in such markets. In addition, for the reasons stated above, they also will required a translator applicant in any top 50 spectrum limited market to demonstrate that its out-of-grid proposal would not preclude the only LPFM station licensing opportunity at that location (“Top 50 Market Preclusion Showing”) by making the showing described below.

LPFM "channel floors"

In the Third Further Notice, the FCC proposed “LPFM Channel Floors” of potential LPFM licensing opportunities in the 150 largest markets, as well as smaller markets where more than four translator applications are pending. These channel floors range from 8 potential LPFM channels in the top 20 markets to 5 potential LPFM channels below the top 100 markets. They based these figures on a rough approximation of the number of noncommercial educational (“NCE”) stations in the top 150 markets. They selected the NCE FM service as a point of reference because that service is the radio service most similar to the LPFM service and, therefore, the best gauge of local community needs for such service. Commenters who addressed our proposed channel floors disputed neither our reasoning nor the specific ranges of channel floors or markets selected for those ranges. Thus, based on the examination of the record, they concluded that the proposed channel floors are a reasonable standard. They found that these floors adequately further the development of the LPFM service in spectrum-limited markets, as intended by Section 5(1) of the LCRA, and strike an effective balance by ensuring that licenses for both LPFM and translator services are available in as many communities as possible, as required by the collective reading of Sections 5(1) and 5(2) of the LCRA. Accordingly, they adopted the channel floors as proposed in the Third Further Notice.

The FCC did, however, revise their processing approach with regard to certain translator applications in both “spectrum limited” and “spectrum available” markets. As an initial matter, they recognized that their use of the 21x21 grid in certain markets has turned some “spectrum available” markets into “spectrum limited” markets. They found that translators serve community needs, especially those in rural or underserved areas. As such, they agreed with NAB that translator applicants in “spectrum limited” markets should be given an opportunity to demonstrate that their applications, if granted, would not preclude any LPFM opportunities. They would also will permit minor amendments to meet this “no preclusion” test. Translator applicants proposing “move-in” modifications and modification applications that propose to move into a “spectrum limited” market will also be allowed to make such a showing. This approach is also consistent with their combined reading of Sections 5(1) and 5(2) because it furthers the statutory goal of ensuring that the Commission provide licensing opportunities for both services in as many communities as possible. Prometheus and others fail to explain how this narrow exception to allow continued translator processing in a “spectrum limited” market will preclude LPFM opportunities, given that, as described in more detail below, we will require translator applicants to protect all channel/point combinations with the assumption that all LPFM applicants in these markets will be eligible for second-adjacent channel waivers. The FCC agreed that translator applicants in “spectrum available” markets should be afforded some opportunity to amend their applications. As noted by many translator advocates, circumstances have changed since 2003, and transmitter sites may no longer be available. The FCC provided applicants with a limited opportunity to amend their applications so long as their proposals do not eliminate any LPFM channel/point combination in any of the 156 market grids and, where applicable, satisfy the Top 50 Market Preclusion Showing. They did not believe that allowing translator applicants these limited opportunities to amend their applications would impede the FCC's ability to guarantee licensing opportunities equivalent to the LPFM channel floors being adopted.

Amendment of pending FM translator applications

The Media Bureau issued a public notice requiring all applicants affected by the national application cap and/or the one application per applicant per market limitation (discussed below) to identify applications for continued processing, consistent with these limits. The auctions anti-collusion rule will remain in effect during this process. Upon completion of this selection/dismissal process, the Bureau will process the remaining applications in “spectrum available” markets, starting with the singletons. Mutually exclusive applications from this group will then be placed on public notice and afforded a 60-90 day window to resolve their application conflicts via settlement or amendment. Any amendment of an application that precludes any LPFM channel/point combination identified in the grid studies will result in application dismissal. Amendments will be processed on a first-come, first-served basis, with all unamended applications having cut-off protection against amendments filed during the settlement period.

Applicants with proposals in “spectrum limited” markets will be given one opportunity to modify their proposals to eliminate all preclusive impacts on protected LPFM channel/point combinations. An applicant in a top 50 “spectrum limited” market proposing facilities outside the studied 31x31 grid also will need to demonstrate either that no LPFM station could be licensed at the proposed transmitter site or, if an LPFM station could be licensed at the site, that an additional channel remains available for a future LPFM station at the same site. Applications that conflict with protected channel/point combinations or fail to make such a Top 50 Market Preclusion Showing and that are not amended to come into compliance with these requirements will be dismissed. As explained above, applications in 31x31 grid “spectrum limited” markets must protect all channel/point combinations within this grid. Applicants in 21x21 grid “spectrum limited” markets must protect all channel/point combinations only within this grid. The Commission limited “spectrum limited” grid protection requirements in these markets because they believed that this standard will protect those areas where LPFM stations can best serve the needs of local communities and, therefore, will most faithfully implement Sections 5(1) and 5(2). From this point, all remaining applications will generally proceed down the same singleton/MX/settlement/auction/long form path. Amendments will be processed on a first-come, first-served basis, including for the purpose of determining whether an additional LPFM channel remains available at a specific location outside the grid. The FCC terminated the freeze on the grant of pending Auction 83 translator applications and directed the Media Bureau to resume application processing in accordance with these procedures.

The FCC provided guidance on translator application processing. “Protected” LPFM channel/point combinations will be determined differently in “spectrum available” and “spectrum limited” markets. In a “spectrum available” market, a channel/point combination must be protected only if LPFM operations at the site would be fully spaced to all pending translator applications on co-, first- and second-adjacent channels (and, of course, would satisfy all other spacing requirements). Thus, a translator applicant in a “spectrum available” market that does not modify its technical proposal would always qualify for further processing because the proposed translator facility cannot conflict, by definition, with any protected channel/point combinations. “Spectrum available” market amendments, however, may not conflict with protected LPFM channel/point combinations. “Spectrum limited” calculations, including Top 50 Market Preclusion Showing calculations, will assume the dismissal of all translator applications in the market. This differing treatment of pending translator applications was based on their determination that sufficient channels are/are not available if all translator applications remain pending. Moreover, the “spectrum limited” channel/point and Top 50 Market Preclusion Showing calculations, the FCC will not take into account second-adjacent channel spacings to authorized stations and other pending applications, i.e., will assume that an LPFM applicant could make a sufficient showing to obtain a second-adjacent channel spacing waiver. Finally, “spectrum limited” calculations will not take into account I.F. spacing requirements. The FCC found that these more restrictive “spectrum limited” market processing standards were necessary to safeguard LPFM licensing opportunities in these markets. As noted, the protection scheme for “spectrum available” markets 1-50 and for all other studied markets are limited to the particular grid used in each market. LPFM licensing opportunities outside the grid in these markets are not protected in either “spectrum limited” or “spectrum available” markets. Thus, a translator application specifying a site at a distance equal to or greater than the minimum LPFM-translator distance separation requirements and otherwise in compliance with licensing rules would be grantable under these processing standards in all “spectrum limited” markets 51 and smaller and all “spectrum available” markets.

Prevention of Trafficking of Translator Permits and Licenses

Overview

The Third Further Notice tentatively concluded that the proposed market-based translator application processing policy would not be sufficient to deter speculative licensing conduct because the remaining translator filings present significant issues of abuse of the licensing process. It tentatively concluded that nothing in the LCRA limits the Commission’s ability to address the potential for licensing abuses by any applicant in Auction 83, and sought comment on processing policies to deter the potential for speculative abuses among the remaining translator applicants. Specifically, it sought comment on whether to establish an application cap for the applications that would remain pending in non-spectrum limited markets and unrated markets, and asked whether a cap of 50 or 75 applications in a window would force filers with a large number of applications to concentrate on those proposals and markets where they have bona fide service aspirations. The Third Further Notice also asked whether applicants should be limited to one or a few applications in any particular market, noting that a limitation of this sort could limit substantially the opportunity to warehouse and traffic in translator authorizations while promoting diversity goals. It also sought comment on alternative approaches to protect against abuses in the translator licensing process.

Comments received

Manny commenters supported some form of cap. EMF opposes any cap at all, believing it will reduce translator services to smaller markets. Other commenters argue that caps fail to distinguish serious applicants from speculators and suppress competition. Some commenters simply disagree with the concerns over speculative filings described in the Third Further Notice. For example, Kyle Magrill suggests that non-commercial applicants may have filed large numbers of translator applications because they believed that it was the best way to ensure they would obtain a permit, and even those permits that were sold have resulted in new facilities on the air serving the public interest. Edgewater Broadcasting, Inc., and Radio Assist Ministry, Inc., also note that applicants accused of trafficking have not in fact violated any of the Commission’s Rules. Several commenters propose alternatives to caps or additional safeguards against trafficking: placing limitations on the number of outstanding translator construction permits an applicant can have; restricting sales of permits to allow applicants to only recover costs; or preventing outright the sale of unbuilt construction permits. NPR suggests establishing a holding period obligating future translator permittees to construct and operate newly authorized translators.

Analysis

The FCC concluded that both a national cap and a market-based cap would be appropriate to limit speculative licensing conduct and necessary to bolster the integrity of remaining Auction 83 licensing. Without the caps, the translator licensing process adopted could result in the prosecution of thousands of applications for the primary purpose of for-profit assignments of the issued translator authorizations. If the permits were issued in an auction, the FCC would have been less concerned, however it was expected that a substantial portion of the remaining grants would be made pursuant to settlement procedures rather than through auctions.

National 50-cap

The Commission believed that a national cap of 50 applications per applicant from the pending Auction 83 applications is an appropriate limit. Because translators are relatively cheap to construct and operate, we believe it is feasible for the organizations that filed the highest volume of applications to construct and operate 50 additional stations. Accordingly, in balancing the competing goals of deterring speculation and expanding translator service to local communities, they concluded that a national cap of 50 applications is appropriate. They noted that this cap is high enough to permit all but twenty applicants to prosecute all of their pending applications.

One-per-market cap

In addition to the national cap of 50 applications, the FCC believed that a per-market cap of one application in the identified markets was appropriate. The translator rules contemplate that a party may receive an authorization for a second or third FM translator serving substantially the same area as the first only after making a “showing of technical need for such additional stations.” This is a spectrum efficiency rule based on our experience that parties rarely need such multiple translators. Yet in some cases, applicants in Auction 83 submitted dozens of applications for a particular market. The FCC opined that these applications were clearly filed for speculative reasons or to skew the auction procedures, as it is inconceivable that a single entity would construct so many stations in a single market. Given the volume of pending applications, it is not administratively feasible to conduct a case-by-case assessment of technical need for such multiple applications within the markets identified. Accordingly, the FCC applied a cap of one translator application per applicant in the markets identified . For applications outside those markets, where the duplication issue is more manageable, the FCC would apply the technical need rule on a case-by-case basis.

Implementation

The FCC will require parties with more than 50 pending applications nationally and/or more than one pending application in the identified markets to identify and affirm their continuing interest in those pending applications for which they seek further Commission processing, consistent with these limits. Both pending long form and short form applications will be subject to these applicant-based caps. In the event that an applicant does not timely comply with these dismissal procedures, the FCC directed the staff to first apply the national cap, retaining on file the first 50 filed applications and dismissing those that were subsequently filed. The staff will then dismiss all but the first filed application in each of the markets identified.

FM Translators for AM Stations

Overview

In 2009, the Commission authorized the use of FM translators with licenses or permits in effect as of May 1, 2009, to rebroadcast the signal of a local AM station. The limitation of cross-service translator usage to already-authorized FM translators was adopted with the intention of preserving opportunities for future LPFM licensing. Two parties filed petitions for partial reconsideration of this aspect of the 2009 Translator Order. Both petitions argue that the limitation of cross-service translators does not serve the public interest and is unfair to both AM stations and FM translator applicants.

The practical effect of the date limit imposed in the 2009 Translator Order was to exclude pending Auction 83 FM translator applications as well as future FM translator applications from the pool of potential cross-service translators. In the Third Further Notice, the FCC asked whether it would be appropriate to remove this limit on cross-service translators with respect to those pending applications. Specifically, we asked whether the limit should be removed for those applications which were on file as of May 1, 2009. The FCC stated that resolving this issue before processing of the pending translator applications would align FM translator processing outcomes more closely with demand by enabling applicants to take the rebroadcasting option into account in the translator settlement and licensing processes, thereby advancing the goals of Section 5(2) of the LCRA. They also noted that allowing cross-service translators had been a very successful deregulatory policy.

Comments received

Most commenters support removing the date restriction for pending FM translator applications. These commenters point to the public service benefits that FM translators have provided to AM stations. Some argue that the need for the date restriction is going away now that the Commission will be opening an LPFM window.

To the extent that commenters take a contrary position, most argue for some type of restriction or limitation on cross-service translators in general. Some LPFM proponents argue for qualifying criteria for cross-service translators, such as local ownership, lack of in-market FM ownership by the AM licensee, diversity of ownership, amount of local programming, and quality of AM signal. REC Networks and Prometheus argue that the 250-watt power level allowed for “fill-in” AM translators should be reduced before cross-service translators are expanded. NPR argues that the date restriction should be kept in place unless the Commission adopts strong anti-trafficking rules so that traffickers in the current pool of Auction 83 applicants will not benefit from the change.

Decision

The FCC modified the date restriction to allow pending FM translator applications that are granted to be used as cross-service translators. As we explained in the Third Further Notice, the limitation of cross-service translator usage to already-authorized translators was adopted with the intention of preserving opportunities for future LPFM licensing. In the Third Further Notice, the FCC decided to revisit this pre-LCRA policy. We proposed changes in the FM translator application processing rules designed to accomplish more effectively the goal of preserving spectrum for future LPFM licensing. Given those proposed changes, as stated above, the FCC indicated that removing the date limit, at least for the pending translator applications, could align FM translator licensing outcomes more closely with demand, thereby advancing the goals of Section 5(2) of the LCRA.

The FCC granted reconsideration of the 2009 Translator Order to the extent of allowing authorizations arising from pending FM translator applications to be used as cross-service translators. With respect to future FM translator applications, the FCC would address their potential use as cross-service translators in a future rulemaking to revise our FM translator rules.

Rule sections amended by this decision

§74.1232 - (Translator) Eligibility and licensing requirements.

Petitions for Reconsideration filed

The following parties filed Petitions for Reconsideration. Since both the Fourth Report and Order and the Fifth Report and Order were released on the same day. Matters under reconsideration could apply to either or both Orders:

Opposition to the Petitions for Reconsideration was filed by Prometheus Radio Project.

Related links

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