Petition — Black Citizens for a Fair Media v. Federal Communications Commission

Supreme Court brief1984

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Supreme Court of the U

OCTOBER TERM, 1983

BLACK CITIZENS FOR A FAIR MEDIA, et ai.,

Petitioners,

FEDERAL COMMUNICATIONS COMMISSION

and UNITED STATES OF AMERICA,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

DANIEL R. OHLBAUM,

Counsel of Record

Suite 548

1200 New Hampshire Ave., N.W.

Washington, D.C. 20036

(i)

QUESTIONS PRESENTED FOR REVIEW

1. Whether the Federal Communications Commission

can find that renewal of television and non-commercial

radio licenses is in the public interest without individualiz-

ed consideration of each applicant’s programming perfor-

mance, in reliance upon a presumption of operation in the

public interest, supplemented by a random review of the

actual performance of five percent of the licensees.

2. Whether the Commission in acting on applications

for renewal of commercial radio licenses may rely for all

licensees upon a presumption of operation in the public in-

terest, with no sampling of any licensee’s actual perfor-

mance.

3. Whether the Commission has engaged in adequate,

reasoned decision-making in its elimination of renewal

procedures protective of the public interest.

PARTIES BELOW

The petitioners here, Black Citizens for a Fair Media,

Chinese for Affirmative Action, the National Council of

La Raza, the National Association for the Advancement

of Colored People, and Henry Geller, were petitioners

below. The respondents below and here are the Federal

Communications Commission and the United States of

Broadcasters Association, Argonaut Broadcasting Com-

pany, Bahia De San Francisco Television Company, Bu-

ford Television, Inc., Enterprise Publishing Company,

Forward Communications Corporation, Futura Commu-

nications Corporation, GCC Communications of Hous-

(ii)

ton, Inc., General Electric Broadcasting Company, Inc.,

Group One Broadcasting Company, Guaranty Broad-

casting Corporation, Infinity Communications Corpora-

tion, KFAB Broadcasting Company, KRLA, Inc., KULA

Broadcasting Company, Lake Broadcasting Company,

Inc., Lake Huron Broadcasting Corporation, May Broad-

casting Company, John H. Phipps Broadcasting Stations,

Inc., Seven Hills Television Company, Spanish Interna-

tional Communications Corporation, Studio Broadcasting

System, Division of Highwood Service, Inc., Summit

Radio Corporation, Suncoast Stereo Corporation, WFDF

Corporation, Wilson Communications, Inc., and WKRG-

TV, Inc. Intervening below in support of petitioners was

the Office of Communication of the United Church of

Christ.

(iii)

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED FOR REVIEW .............00000 (i)

TABLE OF AUTHORITIES ............-cecceeeveeees wa Woe (iv)

PTLD nie vccccccvccsccessctcsnsauvetuciebhenes 1

PENNS eisidcocncvivaccrccssustegncveeh osassusauvat 1

STATUUGRY PROVISIONS 20.0... ccccccccccccccccscccccees 2

STATEMENT OF THE CASE ......ccccccccccccccccccvcveses 4

REASONS FOR GRANTING THE WRIT ...........-.0+0006: 10

PENG oie ccnscosavdconenevedeesetesachucceteennen 21

APPTIGIT oc cc ccccsccsvocbcscvcccsevesosecesbconvesettes la

Opinion of the United States Court of Appeals for

the District of Columbia Circuit ............... ovescccens la

Orders of the Court of Appeals Denying Rehearing

end Rohearing Bt Bane 2... 2c ccsccscccccccsccesses 60a, 6la

Judgment of the Court of Appeals ..........55cecceeceeees 63a

Report and Order of the Federal Communications

Denying Rehesring MPPTTTITTITITITTiT Titi

(iv)

TABLE OF AUTHORITIES

Cases:

Action for Children’s Television v. FCC,

PGs BOE no cdctededvcsvadecsbiadeucwnn

Alianza Federal de Mercedes v. FCC,

EE TE ocd cccececcctnccccecdessvsest

Central Florida Enterprises v. FCC,

a EG HEE Nid dc va cccdccccccdcctcssaannd

Greater Boston Television Corp. v. FCC,

444 F.2d 841 (D.C. Cir. 1970) cert. denied,

IEDs akin cadvcvéuscescenct cccccsunsaven

Leflore £ oadcasting Co. v. FCC,

le ED fo oikid ob oe ve seccacs consccssuese

Motor Vehicle Manufacturers Assn. v. State Farm

Mutual Automobile Ins. Co.,

eee ee Pr ere:

National Association of Regulatory Utility

Commissioners v. FCC, $25 F.2d 630

(D.C. Cir. 1976), cert. denied, 425 U.S. 992 (1976)

Office of Communication of United Church of

Christ v. FCC, 359 F.2d 994 (D.C. Cir. 1966) .... 2... 60 cc eee

Office of Communication of United Church of

Christ v. FCC,

425 F.2d $43 (D.C. Cir. 1969) 2... ccc ccc cece ene n een eeees

Office of Communication of United Church of

Christ v. FCC, ;

707 F.2d 1413 (D.C. Cir. 1983) ... 2.2.22 0ceeeeeeeeeees

Red Lion Broadcasting Co. v. FCC,

TOS UB. BET CIDTDD 0 oc icc ceciccvccccccccsvvecvnceceses

(v)

Page

Statutes and Regulations:

Communications Act of 1934, 48 Stat. 1064,

as amended, 47 U.S.C. §§ 151 ef seq.:

ERE SS 8 Se ee ee 11

a tia coca edsemeebessautetesovecsowds 12

es cS ee beech seddsendesassncsqucens 14

CLA ns kind dbdeevocsacecntedecesess 12, 13, 16

ae wae dwas 14 bn ndbe bbs oo6e veces vcceeaeban 12

iv. cu senseebcbnenessesosbcencwawen 12, 15

Ss dias odckenseescocetbedecencessccecntos 12

i tics. Wh dhedbacdndecedecceeseecucheres 12

i ian Keine ceesavcteseenccovesseshs ough 14

an cn ce cddocesovcetbeveccccosesovecsesoe 12

cau das eteces dbs ecceseccccocctesnash 12

Eh SES SE SE ee 4

Communications Amendments Act of 1982,

Public Law 97-259, 96 Stat. 1087 .. 0... 0. cece eee eees 13

Public Law 97-35, 95 Stat. 357 (1981) .. 2.2... ccc cee cece eee 13

ere Bos vo dconaccdceowosbourdeecgatene 4

Federal Communications Commission Regulations:

er an oc cce 6b asensees covecewenmeenee 14

47 CFR O.281(aXBMGIMA) .. 2.666 cee ee eee eee e eee 14

IED Src cdccceccccccccccccvcseusccescess 14

es Fan ts ic dacnbiovectctvovedsbensensetia &

ee ee cc andabintnetbscncts seetangupee 8

Children’s Television Report and Policy Statement,

$0 FCC 2d 1 (1974), affirmed, Action for Children’s

Television v. FOC, $64 F.2d 48 (D.C. Cir. 1977) ........... 14

Deregulation of Radio, 84 FCC 2d 968 (1981), rehearing

denied, $7 FCC 2d 797 (1981), affirmed in part, |

Office of Communication of United Church of ;

Christ v. FCC, 707 F.2d 1413 (D.C. Cir., 1983) .......... 6, 18 #

(vi)

Page

Further Notice of Proposed Rule Making,

BC Docket No. 79-219, 48 Fed. Reg. 33,499 .............4. 19

Leflore Broadcasting Co., Inc., 65 FCC 2d $56

(1977), affirmed, Leflore Broadcasting Co., Inc.

v. FCC, 636 F.2d 454 (D.C. Cir. 1980) . 2.2.2... 0.00. c eee 18

Notice of Inquiry to Formulate Policies,

eI ios enue Poche chacevates¥urenacede 14

Notice in Docket No. 83-670, 48 Fed. Reg.

EE GUODE ia a ae ess cece ka slwneeeeneeasaa 14

Report and Order in the Matter of Children’s Television

Programming and Advertising Practices, FCC

83-609, Docket No. 19142, released Jan. 4, 1984 ............ 14

Revision of Form 303, 59 FCC 2d 750 (1976) .............045- 15

SJR Communications, Inc., 42 Pike & Fischer,

i NOE vies wubnwbnenedsabchcdeciccenmes 18

FCC Report No. 17,882, BC Docket No. 79-219,

March 2, 1984, Mimeo 2711 ... 2.2.0... cece cece cere eeees 19

Miscellaneous:

S. Rep. No. 44, 82d Cong., Ist Sess. 7(1951) .........05c eens 16

B.F. Chamberlin, Lessons in Regulating Information

Flow: The FCC's Weak Track Record in Interpreting

the Public Interest Standard,

GPEC .5:: Bee. TEST TED viv icnsccccdpenducdacessscedec 19

IN THE

Supreme Court of the United States

OCTOBER TERM, 1983

No.

BLACK CITIZENS FOR A FAIR MEDIA, et ai.,

Petitioners,

Vv.

FETERAL COMMUNICATIONS COMMISSION

and UNITED STATES OF AMERICA,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

OPINIONS BELOW

The opinion of the Court of Appeals (App. 1a-59a) is

reported at 719 F.2d 407. The orders of the Court of Ap-

peals denying rehearing and rehearing en banc (App. 60a,

61a) are unreported. The Report and Order of the Federal

Communications Commission (App. 65a) is reported at 46

Fed. Reg. 26236 and 49 Pike & Fischer, Radio Reg. 2d

740. The Commission’s Memorandum Opinion and Order

denying rehearing (App. 161a) is reported at 87 FCC 2d

1127, 50 Pike & Fischer, Radio Reg. 2d 704.

JURISDICTION

The judgment of the Court of Appeals was entered on

October 7, 1983 (App. 63a). Rehearing and rehearing en

banc were denied on December 12, 1983. The jurisdiction

of this Court is invoked under 28 U.S.C. §§ 1254(1),

235Q(a).

STATUTE INVOLVED

The pertinent portions of the Communications Act of

1934, 48 Stat. 1064, as amended, 47 U.S.C. § 151 ef seq.

are as follows:

Section 307(c):

***Upon the expiration of any license, upon ap-

plication therefor, a renewal of such license may

be granted from time to time for a term of not to

exceed five years in the case of television broad-

casting licenses, for a term not to exceed seven

years in the case of radio broadcasting station

licenses . . . , if the Commission finds that public

interest, convenience and necessity would be

served thereby . . . . In order to expedite action

on applications for renewal of broadcasting sta-

tion licenses and in order to avoid needless ex-

pense to applicants for such renewals, the Com-

mission shall not require any such applicant to

file any information which previously has been

furnished to the Commission or which is not di-

rectly material to the considerations that affect

the granting or denial of such application, but

the “ommission may require any new or addi-

tional facts it deems necesary to make its find-

[47 U.S.C. § 307(c) (redesignated from §

307(d) by Public Law 97-259, approved Sept. 13,

1982, 96 Stat. 1087, 1093).]

Section 308:

(a) The Commission may grant construction

permits and station licenses, or modificatiéns or

renewals thereof, only upon written application

therefor received by it: .. .

(b) All applications for station licenses, or

modifications or renewals thereof, shall set forth

such facts as the Commission by regulation may

prescribe as to the citizenship, character, and

financial, technical, and other qualifications of

the applicant to operate the station; the owner-

ship and location of the proposed station and of

the stations, if any, with which it is proposed to

communicate; the frequencies and the power de-

sired to be used; the hours of the day or other

periods of time during which it is proposed to

operate the station; the purposes for which the

station is to be used; and such other information

as it may require. The Commission, at any time

after the filing of such original application and

during the term of any such license, may require

from an applicant or licensee further written

statements of fact to enable it to determine

whether such original application should be

granted or denied or such license revoked. Such

application and/or such statement of fact shall

t2 signed by the applicant and/or licensee.

[47 U.S.C. § 308(a), (b).]

Section 30%(a):

(a) Subject to the provisions of this section, the

Commission shall determine, in the case of each

application filed with it to which Section 308 ap-

plies, whether the public interest, convenience,

and necessity will be served by the granting of

such application, and, if the Commission, upon

examination of such application and upon con-

sideration of such other matters as the Commis-

sion may officially notice, shall find that public

interest, convenience and necessity would be

served by the granting thereof, it shall grant such

application.

[47 U.S.C. § 30%a).]

STATEMENT OF THE CASE

This petition seeks review of a judgment’ affirming

orders of the Federal Communications Commission (here-

inafter the “Commission”) which amended the license

renewal application forms submitted every seven years by

radio stations and every five years by television broadcast

stations, to eliminate all questions providing information

on the applicant’s past record of program service to the

public and its programming proposals for the next license

term.

The proceeding was instituted by the Commission by

Notice of Proposed Rule Making released July 11, 1980 (J.

App. 47),? which postulated that since “most licensees

meet or exceed” the Commission’s programming guide-

lines, and very few renewal applications had been desig-

nated for hearing for failure to meet the guidelines, the

then-current approach of obtaining program information

'The Court uf Appeals had jurisdiction pursuant to Section 402(a)

of the Communications Act of 1934, as amended, 47 U.S.C. § 402(a),

and 28 U.S.C. § 2342.

*References to “J. App.” are to the Joint Appendix prepared below.

A summary of the Notice is at 45 Fed. Reg. 47,444. References to

“App.” are to the Appendix hereto.

at renewal time’ might be “a largely unnecessary paper-

work and administrative burden on the licensee and the

Commission.” The Commission proposed that review of

individual licensee performance was best eliminated in

favor of primary reliance upon a “hard look” at a random

sampling of full renewal applications together with com-

plaints from the public, to bring sub-par licensee perfor-

mance to the Commission’s attention. (J. App. 48-49.)

Following the receipt of public comment upon the pro-

posed changes, the Commission released a Report and

Order on May 11, 1981 adopting essentially all of its pro-

posals (App. 65a). While asserting that it was not making

any “changes in our technical, programming, or other

substantive requirements that licensees serve the public in-

‘The Commission summed up its existing non-entertainment pro-

gramming information requirements as follows (J. App. 55):

“The Commission requires licensees to submit proposals

for the amounts of informational programming proposed

for the upcoming license term and a tabulation of the

other nonsports programming. Commercial radio licensees

submit this information in Questions 14, 15 and 16 of FCC

Form 303-R. Television licensees submit the particulars

concerning their presentation of this programming on FCC

Form 303-A which is filed annually with the Commission.

terest,” the Commission made a “dramatic shift in our

renewal procedures for broadcast licensees.” (App. 65a.)

The agency abandoned its long-standing practice of ob-

taining program service information from every licensee at

renewal time in favor of a new postcard-size renewal ap-

plication, to be used by all commercial and noncommer-

cial licensees, except for “[a]t least five percent of all com-

mercial TV and non-commercial licensees [who] will be se-

lected at random to complete audit forms which are simi-

lar to the applications they currently file for renewal of

license.” (App. 66a.)*

The new so-called “simplified renewal application” form

(App. 122a) inquires only as to the following matters:

(1) the applicant’s name, address and call let-

ters;

(2) whether required equal employment and

ownership reports are on file with the Com-

mission;

‘In a separate “radio deregulation” proceeding decided February 24,

(3) whether the applicant is in compliance

with the law respecting alien ownership interests;

(4) whether the applicant has been the subject

of adverse findings by any court or administra-

tive body concerning certain illegal conduct, e.g.,

monopoly, fraud, or any felony; and

(5) whether the applicant has the required in-

formation in its public file maintained at the sta-

tion.

A second feature of the new renewal process is to be a

sampling of licensees for on-site inspections by Field

Operations Bureau technical personnel to monitor com-

pliance with technical requirements and insure that the

licensees’ public files contain the required information.

(App. 66a.) It was further stated that the Commission’s

then Broadcast Bureau (now Mass Media Bureau) might

conduct on-site inspections of licensees who submit “pro-

blem applications.” (App. 66a.)°

The Commission explained that “the renewal process re-

mains costly and time consuming for both licensees and |

the Commission. Broadcasters must reduce their records

to the form demanded by the application. Once the ap-

plication reaches the Commission, it must be checked in,

routed to the various reviewing offices, reviewed and ul-

timately stored.” (App. 69a-70a.) The Commission stated

that “[uJnder the rules and policies adopted herein, the in-

formation necessary to conduct an in-depth review of a

licensee’s performance will be available at the station in

the public inspection file. Interested citizens need only visit

that file to avail themselves of the information necessary

to support a complaint or petition to deny, should one be

SNo such inspections have been made.

appropriate.” (App. 81a.) The Commission then stated

that (App. 84a):

In the absence of any indications to the con-

trary, the information supplied by the SRA

[simplified renewal application] is thereby suffi-

cient to make the statutory finding that grant of

the subject renewal application would serve the

public interest. However, the presumption of

service in the public interest may be rebutted

by SRA responses which indicate violations of

Statutory requirements, or Commission regula-

tions. It would also be rebutted by substantial

complaints or petitions to deny alleging vio-

lations of statute, the Commission’s rules or

policies. Moreover, in order to insure the con-

tinued viability of this presumption, we will in-

stitute random long form audits of television and

noncommercial radio licensees. The audit pro-

cedure will provide independent assurance of the

conclusions which support the presumption.

(Footnotes omitted).’

*Under the new policies, commercial radio stations keep publicly

available an annual issues/programs list (see note 4, supra). Commer-

cial television stations keep composite week program logs, annual

listings of community problems and needs and illustrative responsive

programming, and current proposals for non-entertainment program-

ming. (47 CFR § 73.3526.) Non-commercial station public file re-

quirements are set forth in 47 CFR § 73.3527.

’The Commission stated that since it had eliminated its program

percentage guidelines, commercial guidelines, etc., for radio licensees

in the radio deregulation proceeding (see note 4, supra), a “long form

audit” as to radio licensees “would serve no purpose.” (App. 85a.)

The term “audit” is misleading as used by the Commission, since it

means only the submission by a small percentage of licensees of

substantial renewal information. Internal Revenue Service audits, in

contrast, involve checking the accuracy of a sampling of full returns

filed by all taxpayers.

| has

A petition for reconsideration was denied (App. 161la).

The Commission rejected requests that it obtain program-

ming information at renewal time from all licensees, that it

include a “yes-no” question on the television renewal form

as to whether the applicant has met the standards in the

Commission’s processing guidelines, and that it require

television licensees to tabulate the non-entertainment pro-

gramming composite week data from their program logs

and place this tabulation in the public file. (App. 162a-

163a.) Tabulation of the log entries was found to be an un-

warranted burden on licensees. (App. 163a.)*

The Court of Appeals, one judge dissenting, upheld the

Commission, concluding that “the new license renewal

system is adequate to permit the Commission to make the

determination that a license renewal is in the public in-

terest.” (App. 19a.) The court noted that “[t]he Commis-

sion does not dispute that it is required affirmatively to

find that a license renewal is in the public interest, and it

agrees that ‘[a] broadcaster seeking renewal must run on

his record, and the focus of that record is whether his pro-

gramming has served the public interest.’ Brief for FCC at

14; see Office of Communication of United Church of

Christ v. FCC, 359 F.2d 994, 1007 (D.C. Cir. 1966).”

(App. 8a.)

The majority was of the view, however, that since there

was nothing in the Communications Act specifically man-

dating inclusion of programming-related questions in the

renewal application, the Commission is “free under the

Communications Act to alter the license renewal applica-

*A typical log for one day can run over 20 pages. The composite

week for which logs are kept is composed of seven days of the dif-

ferent weeks chosen by the Commission. The task of tabulating this

raw data for every station in the community is now the task of the in-

terested citizen.

tion as it sees fit — provided that the Commission still has

sufficient information to make the required ‘public in-

terest’ determination.” (App. 12a.) It concluded that the

Commission did have “sufficient information,” largely

because the agency could properly rely upon “the input of

the public” to raise programming questions as to licensee

performance. The court also held that in view of the incen-

tive given broadcasters to operate in the public interest by

“the tools which the Commission uses to discover and

punish violators,”® “the Commission has before it a

presumption of service in the public interest.” (App. 18a,

17a.) The court also held that the Commission had com-

plied with reasoned decision-making requirements of the

Communications Act and the Administrative Procedure

Act.

A petition for rehearing, with a suggestion for rehearing

en banc, was denied, three judges dissenting, on December

12, 1983 (App. 61a).

REASONS FOR GRANTING THE WRIT

This case presents a question of major importance in the

administration of the broadcast licensing scheme of the

Communications Act of 1934: whether the Federal Com-

munications Commission can make the required finding

that a broadcaster’s license renewal is in the public interest

without a review of the licensee’s actual performance,

substituting for such review a general presumption of ade-

quate public service in the absence of public complaint, ac-

*The tools referred to are citizen complaints, the long-form “audit”

used for five percent of television and non-commercial licensees, and

on-site technical inspections by the Field Operations Bureau, in addi-

tion to available fines and license revocations.

companied, with respect to television and non-commercial

radio, by a random 5 percent sampling of full renewal ap-

plications.

In “a dramatic shift” in its renewal procedures for

broadcast licensees, the Commission has discarded a long

history of requiring all broadcast licensees to furnish in-

formation concerning their performance at renewal time.

From now on, the Commission will be acting on the vast

majority of license renewals with no information from the

licensee on such material elements of his performance as

the time devoted to news and public affairs, programs of

particular interest to children, local programming, and the

time devoted to commercials. Only 5% of all commercial

television licensees and non-commercial radio and televi-

sion licensees will file so-called “long form audit” renewal

applications similar to the renewal applications previously

submitted by all broadcast licensees. All commercial radio

stations, and 95% of the television licensees (commercial

and non-commercial) and non-commercial radio licensees

will be relieved of this requirement. This is indeed a

dramatic shift and one which potentially affects the broad-

cast service received by every household in America. It is,

furthermore, a shift in procedure which is at odds with the

entire Congressional scheme for regulating the use of the

radio spectrum for broadcast purposes.

Congress, if it had so chosen, might have created a

broadcasting regulatory scheme relying upon random

checks of compliance with substantive public interest stan-

dards and a presumption of service in the public interest in

the absence of complaint from the public. Such a scheme

would indeed have little use for substantial renewal ap-

plications to be submitted by every licensee. As the Com-

munications Act of 1934 makes amply clear, however,

Congress took a quite different course. In order “to main-

tain the control of the United States over all the channels

of radio transmission; and to provide for the use of such

channels, but not the ownership thereof, by persons for

limited periods of time,” 47 U.S.C. § 301, Congress devis-

ed a scheme of individual broadcast licenses which may be

granted, voluntarily modified, transferred, and renewed

only upon a finding that the public interest would be serv-

ed, a finding made in each case upon the basis of a formal

written application. The application process is the cor-

nerstone of the regulatory scheme.

Thus, a written application is required for: a construc-

tion permit, which precedes regular licensing (47 U.S.C.

$§ 308(a), 309(a), 319(a)); a license to operate for a limited

term, which is granted upon completion of construction in

accord with the terms of the construction permit (47

U.S.C. §§ 307(a), 308(a), 30%(a), 319%(c)); a modification

of license (47 U.S.C. §§ 308(a), 309%(a)); an assignment of

license (47 U.S.C. § 310(d)); and, most pertinent here,

every renewal of license (47 U.S.C. §§ 307(c), 308(a),

30%a)).

The application for renewal of a broadcast license is re-

quired to set forth “such facts as the Commission by

regulation may prescribe as to the citizenship, character,

and financial, technical, and other qualifications of the

applicant to operate the station; * * * the hours of the day

or other periods of time during which it is proposed to

operate the station; the purposes for which the station is to

be used; and such other information as it may require.” 47

U.S.C. § 308(b). A renewal may be granted only “if the

Commission finds that public interest, convenience, and

necessity would be served thereby,” 47 U.S.C. § 307(c).

Section 30%(a) provides:

“Subject to the provisions of this section, the

Commission shall determine, in the case of each

application filed with it to which Section 308 ap-

plies, whether the public interest, convenience,

and necessity will be served by the granting of

such application, and, if the Commission, upon

examination of such application and upon con-

sideration of such other matters as the Commis-

sion may officially notice, shall find that public

interest, convenience and necessity would be

served by the granting thereof, it shall grant such

application.”

The obvious purport of the statute, therefore, is that

every broadcast licensee must demonstrate in the renewal

application, with respect to major elements of its perfor-

mance reasonably reportable in application form, that a

grant of another license term is justified.

Furthermore, the governing public interest standard un-

questionably focuses largely upon a licensee’s service to its

community. “Licenses to broadcast do not confer owner-

ship of designated frequencies, but only the temporary

privilege of using them. 47 U.S.C. § 301. Unless renewed,

they expire within three years. 47 U.S.C. § 307(d).™

The statute mandates the issuance of licenses if the ‘public

convenience, interest, or necessity will be served thereby.’

47 U.S.C. § 307(a). In applying this standard, the Com-

mission for 40 years has been choosing licensees based in

part on their program proposals.” Red Lion Broadcasting

Co. v. FCC, 395 U.S. 367, 394 (1969).

'°Congress in 1981 extended broadcast radio licenses to seven years

and television licenses to five years. Public Law 97-35, 95 Stat. 357,

736. The applicable subsection, 307(d), was redesignated as 307(c) by

the Communications Amendments Act of 1982, Public Law 97-259,

96 Stat. 1087, 1093.

The proposition that a licensee’s program service is an

essential component of the public interest is not at issue in

this case. The Commission here stated that “[w]je have not

adopted any changes in our technical, programming, or

other substantive requirements that licensees serve the

public interest. Only procedural requirements have been

altered.” (App. 67a.) And the Court of Appeals specifical-

ly noted the Commission’s agreement that a “broadcaster

seeking renewal must run on his record, and the focus of

that record is whether his programming has served the

public interest.” (App. 8a.)

Thus, the Communications Act imposes upon broadcast

licensees the duty to render a reasonable amount of local

and informational programming.'' The Commission has

processing guidelines for commercial television stations

(other than certain UHF stations),'? and it requires

licensees to direct some programs to the needs and

interests of children. Children’s Television Report and

Policy Statement, 50 FCC 2d 1, 6, 8 (1974), aff'd Action

Sor Children’s Television v. FCC, 564 F.2d 458 (D.C. Cir.

1977); Report and Order in the Matter of Children’s

Television Programming and Advertising Practices, FCC

83-609, Docket No. 19142, released January 4, 1984,

'' See Sections 307(b), 315(a), 47 U.S.C. §§ 307(b), 315(a); Notice of

Inquiry to Formulate Policies, 27 FCC 2d $80, 581 (1971). See also in-

Jra, p. 18.

'2These guidelines contain standards on commercial matter and

percentages of time between 6 a.m. and midnight devoted to local pro-

gramming (5%); informational (news plus public affairs) programm-

ing (5%); and total non-entertainment programming (10%), as well as

on substantial variations between prior program representations and

actual performance. See 47 CFR 0.281(aX(7); (aX8\iiMA); (aX 10Mii).

The guidelines are now the subject of a notice of proposed rulemaking

83-670, 48 Fed. Reg. 37,239 (Aug. 17, 1983).

The Commission’s new “postcard renewal” scheme

abandons the application renewal process mandated by

Congress, and relies, for the great majority of television

and non-commercial licensees, upon the public to present

information which will show that a renewal is not in the

public interest. Yet, data on a licensee’s performance is

conceded to be relevant, it is readily assembled by the

licensee, whose own performance it reflects, and the Com-

mission has previously given the assurance that it is the

minimum necessary for the Commission to perform its un-

changing duty. Thus, the Commission, in amending its

broadcast renewal forms in 1976, stated (in comments ap-

plicable to both radio and television forms) that the revis-

ed forms were designed to better focus the Commission’s

attention “on those program categories which are par-

ticularly relevant to our public interest determination, /.e.,

news, public affairs, all other programming exclusive of

entertainment and sports, and commercial matter,” and

“to elicit only that information needed by the Commission

to discharge its statutory responsibilities.” Revision of

Form 303, 59 FCC 2d 750, 769, 751 (1976). The burden

put upon the licensee by Congress to submit information

justifying renewal has now been converted by the Com-

mission into a burden on the public to bring forth infor-

mation supporting a denial of renewal.

There is nothing in the legislative history of the Com-

munications Act, or in its interpretation by any court, to

justify the Commission’s “dramatic shift.” Thus, National

Association of Regulatory Utility Commissioners v. FCC,

$25 F.2d 630, 645 (D.C. Cir. 1976), cert. denied, 425 U.S.

992 (1976), which was strongly relied upon by the Court of

Appeals to give the Commission practically unfettered dis-

cretion as to what information it will require from renewal

applicants (App. 9a-l1}a), held no more than that 47

U.S.C. § 308 does not require Commission consideration

16°

of the financial qualifications of Specialized Mobile Radio

Systems'? where financial fitness is properly found to be

“irrelevant to its regulatory scheme.” This decision has no

application to concededly material and significant public

interest considerations.

The lower court’s reliance (App. 10a) upon the 1952 .

amendment to then Section 307(d) of the Act (now §

307(c)) to delete a provision which required that action on

renewal applications “be limited to and governed by the

same considerations and practice which affect the granting

of original applications,” is similarly misplaced. This

change was designed to remove an unrealistic requirement,

and nothing in the legislative history suggests that it was

thought to authorize the Commission to refuse to inquire

into each applicant’s program performance at renewal

time. '¢

“[I}t has been basic to the understanding of the renewal

process by both Congress and the Commission that a li-

censee runs on his past record . . .” Alianza Federal de

Mercedes v. FCC, 539 F.2d 732, 735 (D.C. Cir. 1976), and

“in a renewal proceeding past performance is [the Com-

'SSMRSs were a new category of private mobile operators providing

service to third parties on a commercial basis in the land mobile radio

services

'*To the contrary, the Senate committee report states that some

matters, such as financial ability to construct a station or ability to

operate it, might no longer be relevant at renewal time, but that “ijt

should be emphasized that while the recommended amendment does

eliminate the necessity for the type of involved and searching examina-

tion which the Commission must make in granting an original license,

it does not in any way impair the Commission's right and duty to con-

sider, in the case of a station which has been in operation and is apply-

ing for renewal, the overall performance of that station against the

broad standard of public interest, convenience and necessity.” S. Rep.

No. 44, 82d Cong., Ist Sess., p.. 7 (1951).

mission’s] best criterion.” Office of Communication of

United Church of Christ v. FCC, 359 F.2d 994, 1007

(D.C. Cir. 1966). The Commission has now simply refused

to obtain from the licensee the information on his past

record necessary to make the required public interest find-

ing,'* in almost total reliance upon its own presumption

that, in the absence of a complaint from a member of the

public, a licensee has a broadcast record warranting

renewal.

The real question in this case is whether the Commission

is to be permitted through regulatory Aara kiri to disable

itself from administering the Congressionally mandated

public interest standard of the Communications Act. We

submit that the question is one of major significance, and

that the decision below warrants review by this Court.

II.

Whatever might be said for the Commission’s sampling

process for télevision, in renewing commercial radio li-

censes the Commission is now acting on over 8000

renewals with no programming information from even a

'SThe Court of Appeals concluded (App. 13a) that the Commission

would have enough information from several sources “to make the re-

quired determination that a licensee is in compliance with the substan-

tive policies of the Commission — policies that are still concerned with

programming and are not affected by the decision in question.” The

court’s only suppport for this conclusion was a reference to the input

of the public, “in many ways the most citical informa-

. + » -” (App. 13a.) Then, in apparent recognition that public input

on the renewals of thousands of broadcast stations cannot possibly in-

sure the adequate presentation to the Commission of programming in-

formation the court declared (App. 14a) that “the new renewal system

does not rely entirely on the public,” without indicating at any point

what other source there might be of programming information now

eliminated from the renewal form.

sample of them, since no commercial radio licensees need

file the so-called “audit” long form renewal application.

While commercial radio has been “deregulated” (see note

4, supra), these radio licensees are still subject to the

public interest requirement of providing non-entertain-

ment programming responsive to community issues. De-

regulation of Radio, 84 FCC 2d 968, 978-79 (1981), aff'd

in part Office of Communication of United Church of

Christ v. FCC, 707 F.2d 1413 (D.C. Cir. 1983), which

established that the amount of essential public service pro-

gramming, however defined, is relevant to the public in-

terest judgment at renewal. (707 F.2d at 1433.) Therefore,

even if the sampling technique adopted for television

could be sustained as in compliance with the Communica-

tions Act, the absence of even a sampling process for com-

mercial radio leaves the Commission’s radio renewals

devoid of any conceivable legitimizing rationale.

This point has added significance in that there is no

assurance that the Commission will continue to sample 5

percent of television renewal applications, if its radio pro-

cedure is sustained. Rather, what is sanctioned today in

radio can well become the standard tomorrow for televi-

sion. '*

Finally, even if the statute could be construed to give the

Commission the authority it claims, the Commission has

failed to articulate a reasoned basis fcr thrusting upon the

public the primary burden of presenting information on

programming at renewal time. The Commission conceded-

ly must have “sufficient information” (App. 12a) before it

‘See, note 12, supra.

y |

to make the public interest judgment as to each renewal

applicant, in order to ferret out those who render inade-

quate service.'? But the only information the Com-

mission has is that the public has not complained. There is

simply no basis for the Commission to infer — to assume

— that such lack of complaint means that the licensee is

meeting its minimal public service obligations. As the dis-

sent in the Court of Appeals stated (App. 56a-57a),

Reliance on public participation to ensure that

most violators of the programming obligation

are caught is only valid if it can be shown that

the public complains about most violators. The

Commission has not even attempted to make

such a showing. And it is unlikely that it could do

so. The high cost of participation, in time and

money, exerts a strong constraining pressure on

the public. '*

Moreover, the Commission not only initially eliminated

all logs in radio, but upon remand,'® has still decided to

''E.g., Leflore Broadcasting Co., Inc., 65 FCC 2d $56, 567 (1977),

aff'd on other grounds, Leflore Broadcasting Co., Inc. v. FCC, 636

F.2d 454, 462-63 (D.C. Cir. 1980) (non-entertainment programming

not adequate); S/R Communications, Inc., 42 Pike & Fischer, Radio

Reg. 2d 920, 921 (1978) (non-entertainment programming not ade-

quate).

'*In the period between fiscal years 1969 and 1981, the Commission

reported that there were 560 petitions to deny or substantial formal

objections to renewal applications — less than 50 a year. Report of

Broadcast Bureau prepared in connection with Central Florida Enter-

prises v. FCC, 683 F.2d 503 (D.C. Cir. 1982). In a recent study of the

Commision’s license renewal process it was found that in 1981 “[flew

petitions to deny were being filed, and fewer still focused on program-

ming grounds.” B.F. Chamberlin, Lessons in Regulating Information

Flow: The FCC's Weak Track Record In Interpreting the Public In-

terest Standard, 6 N.C.L. Rev. 1057, 1095 (1982) (interview with

Deputy Chief of the Broadcast Bureau.)

'*See note 4, supra. Despite its reliance on public participation, the

eee

(App. 17a).

not require the logging of all public service program-

ming.?° It is difficult to see how the agency can justify,

and the court below approve, calling upon the public to

monitor station performance while at the same time

depriving the public of the practical means to do so. See

Office of Communication of United Church of Christ v.

FCC, supra, 707 F.2d at 1441-42, characterizing such ac-

tion as “almost beyond belief.”

And, it is plainly not reasonable to put upon the public

the burden of tabulating weekly composites from raw tele-

vision station logs, rather than leave this task to the

licensee who seeks the privilege of using the public spec-

trum and who needs in any event to know how it has per-

formed. All the Commission had to say about this was

that the burden on licensees of compiling the data was

“unwarranted.” (App. 163a.)

This is not reasoned decision-making where existing

public protections are being removed. See Motor Vehicle

Manufacturers Assn. v. State Farm Mutual Automobile

Ins. Co., __. U.S. ___, 103 S. Ct. 2856 (1983). Rather,

the above actions constitute “danger signals” that the

agency has “. . . not genuinely engaged in reasoned deci-

sion-making.” Greater Boston Television Corp. v. FCC,

444 F.2d 841, 851 (D.C. Cir. 1970), cert. denied, 403 U.S.

923 (1971). What is involved is a “curious neutrality-in-

favor-of-the-licensee” in the critical renewal process. Of-

2°Instead, the Commission only requires licensees to give five or

more examples of public service programming on a quarterly instead

of an annual basis. See FCC Report No. 17882, BC Docket 79-219,

March 2, 1984, Mimeo 2711. Such a list is thus simply illustrative, and

could amount to an hour or so of the year’s programming, thus leav-

ing the public and any comparative challenger adrift as to the amount

of public service programming.

fice of Communication of United Church of Christ v.

FCC, 425 F.2d 543, 547 (D.C. Cir. 1969).

CONCLUSION

The decision below is inconsistent with the Communica-

tions Act on a question involving the radio and television

service received by the entire listening and viewing public

of the United States. The Commission has forgotten that

“[i}t is the right of the viewers and listeners, not the right

of the broadcasters, which is paramount.” Red Lion

Broadcasting Co. v. FCC, 395 U.S. 367, 390 (1969). It is

respectfully submitted that the petition for a writ of cer-

tiorari should be granted.

DANIEL R. OHLBAUM,

Counsel of Record

Suite 548

1200 New Hampshire Ave., N.W.

Washington, D.C. 20036

(202) 872-3614

HENRY GELLER

Suite 900

1776 K Street, N.W.

Washington, D.C. 20006

WILHELMINA REUBEN COOKE

Citizens Communications Center

c/o Georgetown University Law Center

600 New Jersey Ave., N.W.

Washington, D.C. 20001

Counsel for Petitioners

March, 1984

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

No. 81-1710

BLACK CITIZENS FOR A FAIR MEDIA, et al., PETITIONERS

Vv.

FEDERAL COMMUNICATIONS COMMISSION and

UNITED STATES OF AMERICA, RESPONDENTS

AMERICAN BROADCASTING COMPANIES, INC.,

NATIONAL ASSOCIATION OF BROADCASTERS,

NATIONAL RADIO BROADCASTERS ASSOCIATION,

OFFICE OF COMMUNICATION OF THE

UNITED CHURCH OF CHRIST,

CBS, INc.,

ARGONAUT BROADCASTING COMPANY, et al., INTERVENORS

No. 81-2277

HENRY GELLER, PETITIONER

FEDERAL COMMUNICATIONS COMMISSION and

UNITED STATES OF AMERICA, RESPONDENTS

NATIONAL ASSOCIATION OF BROADCASTERS, INTERVENOR

Petitions for Review of an Order of the

Federal Communications Commission

Argued May 24, 1982

Decided October 7, 1983

Jeffrey H. Olson, with whom Karen Peltz Strauss was

on the brief, for petitioners in 81-1710.

Henry Geller and Ira Barron were on the brief, for pe-

titioner in 81-2277.

Gregory M. Christopher, Counsel, Federal Communica-

tions Commission, with whom Stephen A. Sharp, General

Counsel, Daniel M. Armstrong, Associate General Coun-

sel, Federal Communications Commission, Barry Gross-

man and Stephen F. Ross, Attorneys, Department of

Justice, were: on the brief, for respondents. Marion L.

Jetton and Margaret G. Halpern, Attorneys, Department

of Justice, also entered appearances for respondent, USA.

Stephen A. Weiswasser, with whom J. Roger Wollen-

berg and Susan Low Bloch for CBS, Inc., and James A.

McKenna, Jr., Carl R. Ramey and Douglas S. Land for

ABC, Inc., et al., and Erwin G. Krasnow and Barry D.

Umansky for National Association of Broadcasters and

Thomas Schattenfield for National Radio Broadcasters

Association, were on the brief, for intervenors, CBS, Inc.,

et al., in 81-1710 and 81-2277.

Donna A. Demac was on the statement in lieu of brief

for intervenor, Office of Communication of the United

Church of Christ in 81-1710.

Robert H. Bohn, Jr., and Honora Kaplan were on the

brief, for amicus curiae, Action for Children’s Television

urging remand in 81-1710.

Before: WRIGHT and Bork, Circuit Judges, and

JAMESON,* Senior District Judge for the Dis-

trict of Montana.

Opinion for the Court filed by Circuit Judge Bork.

Dissenting opinion filed by Circuit Judge WRIGHT.

Bork, Circuit Judge: Petitioners, Black Citizens for a

Fair Media, et al.,’ challenge the Federal Communications

Commission’s decision to adopt a simplified renewal ap-

plication for radio and television broadcast licensees. This

decision, made after a full rulemaking procedure, effec-

tively eliminates from the license renewal application

certain information which the Commission had previously

required licensees to submit. Petitioners claim that this

action is contrary to the substantive requirements of the

Communications Act and that, in making the decision,

the FCC failed to comply with the reasoned decision-

making requirements of the Administrative Procedure

Act and the Communications Act. We hold to the con-

trary and affirm the action of the Commission.

This case is a companion to Office of Communication

of the United Church of Christ v. FCC, 707 F.2d 1413

(D.C. Cir. 1983), and National Black Media Coalition v.

FCC, 706 F.2d 1224 (D.C. Cir. 1983). All three cases

involve challenges to the effort of the Federal Communica-

tions Commission (“FCC” or “Commission”) to reduce

the regulatory burden on television and radio licensees.

In July 1980, the Commission filed a Notice of Pro-

posed Rulemaking “to determine whether the public in-

* Sitting by designation pursuant to 28 U.S.C. § 294(d).

1 Petitioners also include Henry Geller, Chinese for Affirm-

ative Action, National Council of La Raza, and the NAACP.

terest would be served by a revamping of [the] broad-

cast renewal application procedures.” Revision of Applica-

‘tions for Renewal of License of Commercial and Noncom-

mercial AM, FM, and Television Licensees, FCC No. 80-

327 (July 11, 1980), at 1. (“Notice”) .* This Notice, which

resulted in the decision now being challenged, proposed a

new procedure for renewing broadcast licenses. In the

past, licensees were required to file extensive applica-

tions * containing, for example, such information as pro-

posed non-entertainment and children’s programming, the

number of public service announcements which were

broadcast, and the degree of compliance with FCC re-

quirements for ascertainment of community needs and

interests.

After reviewing the mechanics of this system, the FCC

stated that its.experience

has shown that most licensees meet or exceed our

operating guidelines .... [WJe have found that

the best vehicle for bringing violations to our atten-

tion has been public participation in our processes

through petitions to deny, informal objections, and

compiaints.

Notice at 2. The FCC concluded that the application

might place an unnecessary administrative and paper-

work burden on both licensees and the Commission.

The Notice therefore proposed a new application sys-

tem that would consist of five different review compo-

nents. First, all licensees applying for renewal would

* A summary of this Notice may be found at 45 Fed. Reg.

47,444 (1980).

_ Ae the Conmmiasion noted, the commercial Selovieien supe

submit ~ postcard-sized. simplified renewal application

containi. g answers to five questions.‘

The second component is a long form audit—essentially

the old renewal form—which would be sent to at least

5% of all television and non-commercial radio stations.

(The FCC represents that, in fact, it has been selecting

10% of the eligible licensees for the long-form audit

since the new procedures went into effect. Brief for

FCC at 9 n.3.) Third, the FCC would continue to re-

quire licensees to make publicly available information

as to how the licensees ascertained the problems and

needs of their communities and the manner in which

the licensee’s programming addressed these problems and

needs. Television stations would also have to include pro-

gramming logs and programming “promises” in their

public files.© The FCC stated its belief that this public

file would make sufficient information available to per-

mit the public to test any concerns regarding a licensee’s

fulfillment of the public service requirement*—an im-

Fourth, the FCC’s Field Operations Bureau would con-

duct random audits of licensees to inspect technical op-

erations and to insure that all required information was

being made available to the public. Fifth, the Broadcast

Bureau would conduct on-site inspections into charges of

licensee misconduct. The Bureau would also have the

power to conduct audits of licensees who submit problem

applications. Other licensees might be audited on a ran-

dom basis.

On May 11, 1981, after receiving numerous comments

from various broadcast groups and “public interest” me-

dia groups, the FCC issued its report and order substan-

tially adopting the proposals as put forward in the No-

tice. Radio Broadcast Services: Revision of Applications

for Renewal of License of Commercial and Noncommer-

cial AM, FM, and Television Licensees, 49 Rad. Reg. 2d

(P & F) 740 (1981) (“Decision”). In promulgating the

new system, the FCC stressed that the rulemaking “pro-

ceeding was never intended to change our current sub-

stantive requirements for the broadcast industry, and it

does not alter the substance of licensee obligations to

serve the public interest.” Id. at 748. Reconsideration of

§ 112, 96 Stat. 1087, 1098 (to be codified at 47 U.S.C.

§ 307(c)). Petitioners say the FCC is unable to make

that affirmative determination without the inclusion of

program-related questions in the renewal form. Second,

petitioners argue that even if the FCC has the discretion

to alter the renewal procedures in the proposed man-

ner, the Commission failed to comply with the reasoned

decision-making requirements of the Communications Act

and Administrative Procedure Act. We address these

points in order.

In determining the mandate of the Communications

Act, 47 U.S.C. § 151 et seg. (1976 & Supp. V 1981), this

court must focus on the language of the Act itself, with

due deference to the Commission’s interpretation of its

own organic law. Subject to the review we discuss below,

the FCC is entitled to reconsider and revise its views as

to the public interest and the means needed to protect

that interest, though it must give a sufficient explanation

of that change. See Central Florida Enterprises, Inc. Vv.

FCC, 598 F.2d 37, 49 (D.C. Cir. 1978). The language

interest standard is “a supple instrument for the exercise

of discretion by the expert body which Congress has

charged to carry out its legislative policy.” FCC v. Potte-

ville Broadcasting Co., 309 U.S. 184, 188 (1940). For

years in the case of television broadcasting licenses,

for a term of not to exceed seven years in the case

of radio broadcasting station licenses, and for a term

of not to exceed ten years in the case of other licenses,

if the Commission finds that public interest, con-

venience, and necessity would be served thereby.

47 U.S.C. 307(d) (1976), as amended by the Communica-

tions Amendments Act of 1982, Pub. L. No. 97-259, § 112,

96 Stat. 1087, 1093 (to be codified at 47 U.S.C. § 307(c)).

Petitioners also refer to section 309(a) which requires the

Commission to determine for each application filed with it

whether the public interest, convenience and necessity will

be served by the granting of such application. 47 U.S.C.

§ 309(a) (1976).

Petitioners then argue that, although the “public in-

terest, convenience and necessity” is not defined in the

statute, the term “public interest”

has historically been defined in terms of nonenter-

tainment programming... . [A] licensee’s past non-

entertainment programming performance is the essen-

tial criterion upon which the affirmative public in-

terest determination must be made at renewal time.

Brief for Petitioners Black Citizens for a Fair Media, et

al, (“BCFM”) at 22-23. In sum, petitioners’ position is

that the simplified renewal application violates the FCC’s

statutory mandate because it eliminates all questions con-

cerning nonentertainment programming.

The Commission does not dispute that it is required

affirmatively to find that a license renewal is in the public

interest, and it agrees that “[a] broadcaster seeking re-

newal must run on his record, and the focus of that

record is whether his programming has served the public

interest.” Brief for FCC at 14; see Office of Communica-

tion of the United Church of Christ v. FCC, 359 F.2d

994, 1007 (D.C. Cir. 1966) (United Church I). All that

Mhatpee em Rega ter iyson wher ved aplaece ners ereafis:

tions relating to certain entertainment programming

is in dispute is whether the FCC is required to include

programming-related questions in its renewal application.

An examination of the statute and case law clearly

shows that such questions are not statutorily required and

that the FCC has the discretion to determine whether to

include them. First, it is obvious from reading the rele-

vant statutory sections—sections 307(c), 308(b), and

809(a) of Title 47—that Congress did not prescribe spe-

cific inquiry into programming. Indeed section 308(b)

explicitly addresses the issue of applications and lists

certain subjects about which the Commission may in-

that

* Section 308(b) provides:

All applications for station licenses, or modifications

or renewals thereof, shall set forth such facts as the

Commission by regulation may prescribe as to the citi-

zenship, character, technical, and other

qualifications of the applicant to operate the station; the

ownership and location of the proposed station and of

the stations, if any, with which it is proposed to com-

municate; the frequencies and the power desired to be

used ; the hours of the day or other periods of time during

which it is proposed to operate the station; the purposes

for which the station is to be used; and such other infor-

mation as it may requite. The Commission, at any time

after the filing of such original application and during

the term of any such license, may require from an appli-

cant or licensee further written statements of fact to

enable it to determine whether such original

should be granted or denied or such license Such

application and/or such statement of fact shall be signed

by the applicant and/or licensee.

47 U.S.C. §308(b) (1976).

10a

[Section 308(b)] leaves it within the discretion of

the Commission to decide which facts relating to such

factors it wishes to have set forth in applications.

National Association of Regulatory Utility Commissioners

v. FCC, 525 F:2d 630, 645 (D.C. Cir.), cert. denied, 425

U.S. 992 (1976). Petitioners contend, in effect, that an

empowering statute that explicitly grants the Commission

broad authority must be read implicitly to impose a highly

specific duty. Without more, this is a dubious proposition.

A review of the legislative history of the Communica-

tions Act and past actions of the FCC reinforces our read-

ing of the statutory text. Prior to 1952, the Communi-

cations Act limited the FCC’s discretion to grant renewal

by requiring the FCC to employ the same practices and

considerations it would employ if it were granting an

initial license. In 1952, however, Congress eliminated

this requirement and inserted the more general “public

interest, convenience, and necessity” standard. Communi-

cations Act Amendments, 1952, ch. 879, $6(a), 66 Stat.

711, 714-715. The House Report clearly shows that Con-

gress wanted to reduce the regulatory burden on licensees

and grant the FCC discretion to tailor the renewal form

as it saw fit. See H.R. Rep. No. 1750, 82d Cong., 2d Sess.,

reprinted in 1952 U.S. Code Cong. & Ad. News 2234.**

In the past, the Commission has frequently added and

subtracted questions as it deemed appropriate. For

example, it was not until the 1960’s and 1970’s that ques-

tions concerning ascertainment of community needs and

% The Report notes:

Considerable dissatisfaction was expressed . . . with the

burdensome requirements which applicants for renewal

sometimes have been compelled to meet in the way of

furnishing detailed information.

H.R. Rep. No. 1750, supra, at 8, reprinted in 1952 U.S. Code

Cong. & Ad. News at 2242.

children’s programming were added to the form." Cer-

tainly, if the FCC can add specific questions, it can delete

them when circumstances warrant.

Moreover, the Commission frequently decides to monitor

and enforce certain aspects of a licensee’s performance—

e.g., compliance with the fairness doctrine—on an ad hoc

basis rather than at the time for license renewal. See

National Citizens Committee for Broadcasting v. FCC,

567 F.2d 1095, 1115-16 (D.C. Cir. 1977), cert. denied,

436 U.S. 926 (1978) (Communications Act does not re-

quire FCC to review fairness doctrine compliance at re-

newal time; decision to review on ad hoc basis is reason-

able exercise of discretion). Thus, the legislative history

of the Communications Act and past FCC actions make

clear that the FCC is in no way required to retain certain

questions, whether program-related or not, in the renewal

application.”

Finally, case law strongly supports the broad exercise

of FCC discretion both to define the public interest and

to determine what procedures best assure protection of

that interest. As the Supreme Court has pointed out:

Necessarily, therefore, the subordinate questions of

procedure in.ascertaining the public interest, when

the Commission’s licensing authority is invoked...

were explicitly and by implication left to the Com-

mission’s own devising, so long, of course, as it

observes the basic requirements designed for the pro-

tection of private as well as public interest.

FCC v. Pottsville Broadcasting Co., 309 U.S. at 188.

% See Commission En Banc Programming Inquiry, 44

F.C.C. 2308, 2316 (1960); Formulation of Rules and Policies

Relating to the Renewal of Broadcast Lictems, 48 F.C.C.2d

( :

% The statute does require the inclusion of certain tech-

nical information such as the nature of licensee ownership,

although it does not prescribe specific questions. 47 U.S.C.

§ 308(b) (1976).

12a

Moreover, the Supreme Court recently found that this

discretion is particularly broad in the area of program-

ming. In FCC v. WNCN Listeners Guild, 450 U.S. 582

(1981), the Court upheld a decision by the FCC not to

review entertainment format changes in the context of a

license renewal application, noting that “the Commis-

sion’s judgment regarding how the public interest is best

served is entitled to substantial judicial deference.” Id. at

596. See also National Tour Brokers Association v. ICC,

671 F.2d 528, 531-32 (D.C. Cir. 1982) (upholding revised

ICC licensing procedure involving “public interest” de-

termination; prior ICC interpretation of statute does not

forever bind agency).“ There can be little question that

the FCC is free under the Communications Act to alter

the license renewal application as it sees fit—provided

that the Commission still has sufficient information to

make the required “public interest” determination.

This latter issue is the crux of petitioners’ complaint.

Petitioners contend that even if the FCC has discretion

to alter the application, the changes that the Commission

has adopted so completely eliminate important informa-

tion as to make meaningful enforcement of the public in-

terest standard impossible. Although the FCC has deleted

from the application many questions which previously

supplied substantial information, we believe that it was

not arbitrary or capricious for the Commission to con-

clude, in the exercise of its discretion, that it still has

sufficient information to make the “public interest” de-

termination.

18 National Tour Brokers is in many ways analogous to this

case. In the former, the National Tour Brokers Association

challenged the ICC’s simplification of its licensing procedures

for passenger tour brokers. The court upheld the agency’s

13a

The Commission does not propose to rely solely on the

postcard application to make the “public interest” finding.

The postcard renewal form is one of several sources of

information (direct and indirect) on the basis of which

the Commission will make its renewal decision. This in-

formation, taken together, does permit the FCC to make

the required determination that a licensee is in compli-

ance with the substantive policies of the Commission—

policies that are still concerned with programming and

are not affected by the decision in question.“

A brief review of the renewal system illustrates this

point. First, the Commission has the renewal form itself

which provides (1) information concerning a licensee’s

equal opportunity program, (2) a description of a li-

censee’s other media interests, (3) a certification of com-

pliance with the alien ownership requirements of the act,

(4) disclosures about a licensee’s character, and (5) a

certification that the licensee has placed all required

documents in its public file.

Second, the FCC will have the input of the public. This

is in many ways the most critical information, as the

Commission has “found that the best vehicle for bringing

violations to [its] attention has been public participation

in [its] processes through petitions to deny, informal ob-

jections, and complaints.” Notice at 2. Under the new

renewal system public input provides information in two

ways. As the Notice pointed out, the public brings viola-

tions to the attention of the FCC. Thus, public silence

supports an inference that a licensee has been complying

with FCC policies.“ Such an inference is of course not in

14 Petitioners concede that the great majority of broad-

casters “are responsible and will follow the policies, with or

without these supplementary procedures.” Brief for Petitioner

Henry Geller at 11. Thus, the question is whether the renewal

system will ferret out the few broadcasters who do not comply

with the substantive policies.

4% From ail indications, the public has not been reticent

about registering complaints. During the 12-month period

l4a

any way conclusive; but it is a factor which the FCC may

weigh in making a “public interest” determination.

Petitioners contend that this reliance on the public con-

stitutes an impermissible shift of the FCC’s statutory

duty onto the public. This argument, however, overstates

the FCC’s reliance on public participation. Contrary to

assertions by petitioners, the new renewal system does

not rely entirely on the public. Rather, information pro-

vided by the public is but one factor, albeit an important

factor, in the overall renewal scheme. Moreover, the de-

gree of reliance is not unreasonable because, as the Com-

mission notes, the public is quite aware of licensees’ pro-

gramming. Brief for FCC at 22. Such reliance on the

public is especially warranted in an era of limited re-

sources when the FCC must allocate its budget over a

wide range of regulated activities. Cf. United Church I,

859 F.2d at 1004-05 (recognizing importance of public

participation in renewal process, given limited staff and

resources). The public’s responsibility in the prior system

was also substantial. Indeed, it was the FCC’s recogni-

tion of the importance of the public’s role that led, in

part, to the promulgation of the new system.

Finally, petitioners argue that, even if the FCC’s reli-

ance on the public is permissible, the Commission has

made it impossible for the public to play an active role

in the renewal procedure. In this regard, petitioners

point to FCC actions which petitioners claim have severely

limited the information licensees must provide to the

public.** In order to determine the validity of this claim,

through October 1981, approximately 3000 programming-

related complaints were sent to the FCC, not including or-

ganized write-in campaigns. Brief for FCC at 22 n.25.

4 It should be noted that the Decision is premised, in part,

on the Commission’s belief that sufficient information is

available in the public file.

1Sa

we examine separately the public file requirements of

television and radio licensees."”

Television licensees must place a substantial amount of

information in their public file. For example, a licensee

must include documentation concerning ascertainment of

community problems as well as an annual list of no more

than ten significant problems or needs of the community

served, along with examples of programs which meet these

problems or needs. 47 C.F.R. § 73.3526(a) (9) (1982).

In addition, television licensees must maintain program

logs for the composite week and keep on file current

“promises” concerning presentation of nonentertainment

programming; if a licensee changes its general plans for

such programming, it must then file an update noting

the changes and the new programming promises.** Id.

§ 73.3526(a) (8). Finally, television licensees must also

maintain raw program logs (a written record of every-

thing a licensee broadcasts), id. § 73.8526(a) (10), and

make these logs available for public inspection in ac-

cordance with certain procedures, 47 C.F.R. § 73.1850

(1982).” This information is sufficient to permit the pub-

17 Licensees must certify on the renewal application that

all required information has been placed in the public file.

If a licensee so stated but in fact failed to provide such infor-

mation, it would commit a serious violation and would be

subject to FCC sanctions.

defined a “substantial deviation,” the occurrence of which

requires an update, as a 15% decrease in any one of the three

nonentertainment categories or as a 20% decrease overall.

Id, at 1129 n.5.

tion as to a licensee’s The petitioners would

prefer composite week logs which tabulate into programming

categories a licensee’s petitioners spe-

16a

lic to review a station’s programming performance.”

In contrast, radio licensees need file only an annual

issues/programs list** and an explanation of the meth-

odology used to compile the list.“ Petitioners argue that

a yearly tabulation of composite week logs in which percent-

age figures for news, public affairs, and “others” (exclusive

of entertainment and sports) are listed.

The FCC eliminated Form 308-A because in its view the

burden on the licensee of completing the form was unwar-

ranted, Reconsideration Decision at 1128. However, the cita-

tion accompanying this statement refers to a paragraph of

the Decision which discusses the burden on the Commission.

Decision at 754-55. Either of these burden reductions is an

advantage the Commission is entitled to weigh in its decision;

under the new system, the Commission need not review the

logs and the licensee is not required to prepare them (although

it may do so). The assessment of this benefit and the im-

portance of tabulated logs we leave to the Commission. There

until 1978. Renewal of Broadcast Licenses, 48 F.C.C.2d 1, 70

(1978).

* Petitioner BCFM also complains that the FCC’s decision

Re.

17a

this list is too insubstantial to permit meaningful review

by the public of a station’s programming and urge the

inclusion of program logs. In a companion case dealing

with the FCC’s general deregulation of radio, we re-

manded the Commission’s decision to do away with the

logging requirement. Office of Communication of the

United Church of Christ v. FCC, 707 F.2d 1418 (D.C.

Cir. 1988) (United Church III). On remand, the Com-

mission will decide what logging requirement, if any,

is appropriate in the deregulated environment. Given the

Commission’s wide latitude in the practical implementa-

tion of Congress’ will, we do not find that the renewal

procedure mechanism adds any new factors to the cal-

culus already required by United Church III. The new

renewal procedure will function acceptably given what-

ever logging requirement the Commission (subject to

judicial review) eventually adopts in response to our re-

mand. Accordingly, we neither invalidate the new re-

newal system on this basis nor provide any additional

condition that any logging requirement must meet.

Finally, the Commission has before it a presumption

of service in the public interest. Decision at 748. Peti-

tioners attack this presumption as being contrary to sec-

tion 309(c) of the Communications Act and such cases

as United Church I, 359 F.2d at 1008, and Office of Com-

munication of the United Church of Christ v. FCC, 425

F.2d 548, 545 (D.C. Cir. 1969) (United Church. II),

which hold that a licensee must affirmatively demonstrate

that renewal will serve the public interest. This attack

is misplaced. Neither the statute nor the legislative his-

18a

provides strong incentives for operation in the public

interest.*

Those incentives are generated largely by the tools

which the Commission uses to discover and punish vio-

lators. Investigation of citizen complaints is one im-

portant tool. In addition, the long form audit and on-

site inspections by the Field Operations Bureau and

Broadcast Bureau are designed not only to provide the

Commission with concrete information on the specifica

licensees audited but also tw deter licensees from non-

compliance with the substantive requirements. The Com-

mission can also prevent potential violations by punishing

those discovered with fines and license revocations. The

severity of such sanctions, see, e.g., WADECO, Inc. v.

FCC, 628 F.2d 122 (D.C. Cir. 1980), and the willingness

of the FCC to impose them make more reliable a pre-

sumption that a licensee will adhere to the substantive

requirements of the Commission and the Act.

Petitioners respond to this contention by arguing that

only a small percentage of licensees are subject to the

random audit and spot checks and that consequently the

deterrent effect of such devices is minimal. All licensees

will be affected by the knowledge some unknown number

will be examined and, if appropriate, visited with severe

sanctions. Moreover, the determination concerning de-

grees of deterrence is precisely the type of judgment

which is best left to the Commission. Nor is the fact

that the FCC may not be able to identify all noncomply-

ing licensees a reason to overturn the decision. No regu-

latory scheme which depends in part on the good faith of

the licensee will be utterly fool-proof; the previous system

certainly was not. Both approaches ultimately rely on

presumptions and on the good faith of the licensees.

* The inference is also supported by the” Commission’s

traditional limited reliance on licensee good faith.

19a

The simplified renewal application also offers concrete

benefits in the form of reduced paperwork and expense.

While these factors are not, of course, grounds for ignor-

ing a statutory mandate, they are an advantage the

Commission is entitled to weigh in making its decision.

The Federal Paperwork Reduction Act of 1980, Pub. L.

No. 96-511, 94 Stat. 2812 (codified at 44 U.S.C. §§ 3501-

3520 (Supp. V 1981) ), was enacted “to minimize the fed-

eral paperwork burden,” 44 U.S.C. § 3501(1) (Supp. V

1981). This is to be accomplished by eliminating regu-

latory burdens “which are found to be unnecessary and

thus wasteful... .” S. Rep. No. 930, 96th Cong., 2d

Sess. 3, reprinted in 1980 U.S. Code Cong. & Ad. News

6241, 6248. Congress specifically applied this policy to

the FCC’s domain when it extended the broadcast li-

cense term to five years for television stations and seven

years for radio. Omnibus Budget Reconciliation Act of

1981, Pub. L. No. 97-35, § 1241, 95 Stat. 357, 736.%

Thus, the reduction in regulatory burden which the FCC

has effected is not just a result of FCC impulse, but

rather stems directly from the Paperwork Reduction Act

and congressional policy with respect to the FCC. There

can be little doubt that this mandate provides further

support for the FCC’s decision.

We conclude that the new license renewal system is

adequate to permit the Commission to make the deter-

mination that a license renewal is in the public interest.

™* The Conference Report noted:

{T]he extension of terms for broadcast licensees would

help to reduce costs to broadcasting and the Commission

costs, while at the same time allowing the Commission

to do a better job reviewing broadcasters’ performance.

H.R. Rep. No. 208, 97th Cong., lst Sess. 895 (Conference

Report), reprinted in 1981 U.S. Code Cong. & Ad. News

1010, 1257.

20a

Petitioners’ second major argument is that even if the

FCC has the statutory discretion to adopt the simplified

renewal application, the Commission has nevertheless

failed to comply with reasoned decision-making require-

ments of the Communications Act and the Administra-

tive Procedure Act. The Commission’s decision, however,

readily survives the “searching and careful” review to

which we subject it. See Citizens to Preserve Overton

Park, Inc. v. Volpe, 401 U.S. 402, 416 (1971).

Here, our review must include an additional special

factor: the FCC’s adoption of the simplified renewal ap-

plication represents a significant change in policy. The

court must, therefore, be satisfied that the agency was

aware that it was changing its views and has articulated

permissible reasons for the change. See Greater Boston

Television Corp. v. FCC, 444 F.2d 841, 852 (D.C. Cir.

1970), cert. denied, 403 U.S. 923 (1971).*

This is not a case where an agency altered course with-

out acknowledging or recognizing the change. The first

ph of the Notice states that the proceeding was

being initiated to determine whether the FCC should “re-

vamp” its renewal procedures. Notice at 1.

“In emphasizing that we pay special attention to changes

998 (D.C. Cir. 1982). Of course, this scrutiny consists in

reasons for the change, and

2la

Nor is this a case where the agency has failed to pro-

vide a reasoned explanation for its change in policy.

Here the Commission clearly set out its rationale; namely,

that the same degree of compliance could be achieved

with the simplified renewal application. While this find-

ing is not in itself rigorously deduced, it is well estab-

lished that greater deference is given administrative bod-

ies when their decisions are based upon “judgmental or

predictive” conclusions. FCC v. National Citizens Com-

mittee for Broadcasting, 486 U.S. 775, 813-14 (1978).

Accord FCC v. WNCN Listeners Guild, 450 U.S. at 595-

96. The FCC also clearly stated that adoption of the

simplified renewal application would in turn “free up

scarce resources for use in other areas.” Decision at 747.

This finding was factually supported in the record by,

for example, estimates of the funds that would be saved

by adoption of the new form. E.g., Decision at 754.

Petitioners specifically attack two aspects of the De-

cision. Petitioners assert that the basis of the FCC’s

decision was the conclusion that past experience indicated

most licensees comply with the substantive regulations.*

They then contend that this conclusion does not warrant

altering the procedures and, if anything, supports re-

taining the old system.” This argument, however, dis-

has resulted in few applications designated for hearing

for failure to comply with our rules and policies.

Decision at 748. This statement was not the basis of the

FCC’s decision; rather, it was merely an observation that the

previous guidelines were to some degree excessive. The more

important basis of the decision was that the new system would

work equally well.

* Petitioners state:

The abandonment of efficacious procedures, on the ground,

that they were efficacious, hardly constitutes reasoned

ies

22a

torts the Commission’s position. The Commission dis-

carded the old system for the new not because the old

system worked, but rather because it believed the new

system would work just as well:

We believe that we can discharge our obligations by

adopting a simplified renewal application (SRA)....

Decision at 741. In overlooking the Commission’s con-

clusion that the new method could achieve equivalent com-

pliance, petitioners reveal the true nature of their com-

plaint; they believe the old system works better and wish

to substitute their judgment for that of the Commission.

When seen in that light, petitioners’ argument must

fail.**

As we have noted, and as petitioners concede, the Com-

munications Act gives the FCC “substantial discretion

to reconsider and review the appropriateness of [its]

regulations including the continued need for particular

information in connection with renewal applications.”

Decision at 747; see National Association of Regulatory

Utility Commissioners v. FCC, 525 F.2d at 645. More-

over, the FCC has worked with renewal applications for

many years and has developed considerable expertise and

experience.” See West Michigan Telecasters, Inc. v. FCC,

decision-making. If anything, the Commission’s rationale

merely confirms the continued need for the traditional

renewal procedures... .

Brief for Petitioners BCFM at 40.

* Petitioners also assert that reasoned

study. See NAACP v. FCC, 682 F.2d at

1001 (rejecting argument that FCC should have conducted

independent study prior to changing its Top-Fifty Policy).

In National Tour Brokers, 671 F.2d at 583, the court

found that the ICC’s decision to simplify licensing procedures

Saag aes

3 Oi ee gee

23a

896 F.2d 688, 691 (D.C. Cir. 1968) (court “defer[s] to

the expertise and experience of the Commission within

its field of specialty and would reverse only where the

Commission’s position is arbitrary, capricious or un-

reasonable”) .

Petitioners also argue that the FCC cannot dispense

with the old system on the basis of a desire to relieve

itself and/or licensees from regulatory burdens. Again,

however, this argument is premised on petitioners’ belief

that the new system will not serve the public interest.

The FCC has reasonbly rejected that premise and we

must reject the conclusion. The Commission may consider

regulatory burden in choosing between two procedures,

each of which serves the public interest. The FCC is,

moreover, statutorily authorized to reduce the regulatory

burden on licensees and we find this to be additional sup-

port for the Commission’s action.

Accordingly, the orders here under review are

Affirmed.

24a

WRIGHT, Circuit Judge, dissenting: The Federal Com-

munications Commission (the Commission) has in recent

years undertaken a substantial deregulation of broadcast-

ing in this country. In two companions to this case,

Office of Communication of United Church of Christ v.

FCC, 707 F.2d 1418 (D.C. Cir. 1983), and Nat'l Black

Media Coalition v. FCC, 706 F.2d 1224 (D.C. Cir. 1983),

this court approved, with some reservations, the bulk of

the Commission’s dergulatory effort. In the present case

petitioners, Black Citizens for a Fair Media et al., have

brought a challenge to the Commission’s recent deregula-

tory endeavors in the area of broadcast license renewal.

After notice and comment rulemaking, the Commission

promulgated in 1981 a rule that dramatically pared down

the license renewal procedures for broadcast licensees. In

particular, the Commission eliminated its long-standing

practice of requiring all renewal applicants to provide the

Commission with substantial information about their pro-

gramming during the prior license term. Petitioners’

challenge springs from this decision to eliminate indi-

vidualized programming inquiries from the renewal proc-

ess. They assert that this decision contravenes the sub-

stantive requirements of the Communications Act, 47

U.S.C. § 151 et seq. (1976 & Supp. V 1981), and is not

25a

resource, the remunerative potential of which has proven

to be vast. In return, the broadcaster must use this pub-

lic resource so as to serve the “public interest, conveni-

ence, and necessity.” 47 U.S.C. §§ 303, 307, 309, 315.

This public interest standard mandates programming that

meets the needs of a broadcaster’s viewing or listening

community. See Part III-A infra. The statute establishes

the Commission as the overseer of this relationship be-

tween the broadcaster and its viewing or listening public.

The Commission exercises this oversight primarily

through the renewal process. To fulfill its responsibility

the Commission had traditionally required each renewal

applicant to provide information sufficient to permit the

Commission to determine whether the applicant had met

its public interest programming obligations. Only by

making such an individualized inquiry into the program-

ming of every renewal applicant can the Commission

abide by the statutory mandate that it “shall determine,

in the case of each application filed with it * * * ,

whether the public interest * * * will be served” by

renewal. 47 U.S.C. §309(a) (emphasis added). The

Commission’s recent decision to forsake programming in-

quiries amounts to an abdication of its statutory responsi-

bilities, and this court should invalidate the Commission’s

plan.

I. BACKGROUND

A. The Commission’s Traditional Approach to Re-

newal of Broadcast Licenses

Traditionally, programming inquiries have been central

to the renewal process under the Communications Act.

Sections 307 and 309 of the Act, 47 U.S.C. §§ 307, 309,

direct the Commission to grant license renewals only to

applicants who have provided service in the public in-

terest. Until its recent turnabout, the Commission had

always thought that this statutory directive mandated an

inquiry into programming of every renewal applicant.

26a

The Commission first set out this understanding in its

“Blue Book” of 1946, REPORT ON PUBLIC SERVICE RE-

SPONSIBILITY OF BROADCAST LICENSEES 11-12 (1946). The

Blue Book states that “there can be no doubt that Con-

gress intended: the Commission to consider overall pro-

gram service in processing applications,” and that the

Commission is “under an affirmative duty, in its public

interest determinations, to give full consideration to pro-

gram service.” Jd. Fourteen years later the Commission

restated its commitment to the necessity of programming

inquiries in its Report and Statement of Policy Re: En

Bane Programming Inquiry, 44 FCC 2808 (1960) (here-

inafter En Bane Programming Inquiry). This policy

statement recognized that the licensee’s public interest

obligations required it to “render the best practicable

service to the community reached by [its] broadcasts,”

id at 2311, and that this service encompassed a “diligent

and desires” of the broadcaster’s community. Jd. at 2312.

The Commission also acknowledged its own duty to “pro-

vide reasonable assurance te the public that the broad-

cast service it receives is such as its direct and justifiable

interest requires,” id. at 2313, and noted that the “par-

ticular manner in which applicants are required to depict

their proposed or past broadcast policies and services * * °

may * * * have significant bearing upon the Commission’s

ability to discharge its statutory duties * * °*.” Id. at

ming

and interests. Jd. at 2316-2317.

In 1965 the Commission revised its renewal application

for radio stations to implement the findings of the 1960

En Bane Programming Inquiry. See Amendment of Seec-

tion IV of Broadcast Application Forms 301, 308, 314,

27a

and 315, 1 FCC2d 439 (1965) (hereinafter AM-FM Pro-

gram Form). And in 1966 the Commission similarly

amended its renewal application for television stations.

See Amendment of Section IV of Broadcast Application

Forms 301, 303, 314, and 315, § FCC2d 175 (1966). In

both cases the new renewal application required licensees

to provide detailed nonentertainment programming in-

formation.

The Commission again revised its renewal applications

in 1973. See Formulation of Rules and Policies Relating

to the Renewal of Broadcast Licenses, 48 FCC2d 1 (1978).

This revision required television licensees to fill out an

annual program form that focused on the licensee’s

annual nonentertainment programming, and to maintain

the form in a file open to public inspection. The 1973

revision also required more detailed information on the

renewal applicant’s efforts to ascertain community needs,

its programming responsive to these needs, its program-

ming directed to those under twelve years of age, and

its commercial practices. See Appendix B to brief of

petitioners Black Citizens for a Fair Media et al.

Two years later the Commission conducted yet another

rulemaking to revise its renewal applications. See Re-

vision of FCC Form 308, Application for Renewal of

Broadcast Station License, Notice of Inquiry and Pro-

posed Rulemaking, 52 FCC2d 184 (1976). This proceed-

ing led one year later to a revised application that sig-

nificantly reduced the number of particular areas into

which the renewal application inquired. See Revision of

FCC Form 308, Application for Renewal of Broadcast

Station License, 59 FCC2d 750 (1976) (hereinafter FCC

Form 303). The Commission stressed, however, that this

simplification of the renewal form was intended only to

permit the Commission to focus on program categories

“particularly relevant to [its] public interest determina-

tion,” id. at 769, and that no diminution in the Commis-

sion’s statutory duty to make a public interest finding

for each renewal applicant was implied.’

Thus, immediately prior to the rulemaking proceedings

that resulted in the rule challenged in this case, the Com-

mission’s renewal application forms continued to place

substantial emphasis on licensee nonentertainment pro-

gramming.”

B. Procedural History of the Commission’s New Plan

On July 11, 1980 the Commission issued a notice of

proposed rulemaking to consider possible revision of the

license renewal process. Notice, supra note 2, JA 47. In

this proposed rulemaking the Commission, bringing its

deregulatory credo to bear on the renewal process, sought

to reduce the substantial filings that had been required of

all renewal applicants. It stated its rationale for this

policy :

1The Commission stated:

In each case involving a renewal application the Commis-

licensee’s performance and to predicate the required

lic interest finding must continue to be elicited. * * *

FCC Form 3038, 69 FCC2d at 752.

Notice at 2, JA 48.

In light of these beliefs, the Commission proposed a

dramatic revision in the renewal process. The Commis-

sion proposed in particular that the in-depth renewal ap-

plications be scrapped and replaced with the following

four-part scheme:

(1) All licensees would be required to complete

a simplified renewal application. This application

would be postcard size and would ask four brief ques-

tions concerning the applicant’s compliance with the

alien ownership, equal employment opportunity, good

character, and public file requirements of the Act.

(2) Long-form audits, which would closely re-

semble former application forms, would be sent to a

random sample of five percent of all licensees. These

forms would contain detailed programming inquiries.

(3) On-site inspections would be conducted on ap-

proximately 16 percent of licensees. Inspections

would compliance

quirements and with public file requirements.

(4) Licensees would continue to maintain a public

file that contained information regarding the licen-

See Notice at 3-15, JA 49-61.

30a

This scheme embodies a distinct shift away from the

individualized review of programming practices that the

Commission had for so long thought the Act required.

Under the new plan* the Commission would rely on a

combination of deterrence through the threat of audit or

inspection and public vigilance, facilitated by information

in the licensees’ public files, to ensure that licensees pro-

grammed in the public interest. If the Commission were

to receive a public complaint, or if the postcard applica-

tion, long-form audit, or on-site inspection were to turn

up evidence of programming inadequacy, the Commission

would make an individualized inquiry into the licensee’s

programming. Otherwise the Commission would presume

licensee compliance with programming requirements.

C. The Decision to Adopt the New Plan

After receiving and considering comments from more

than 100 parties, the Commission approved the postcard

renewal plan in a form essentially identical to that origi-

nally proposed. Radio Broadcast Services: Revision of

Applications for Renewal of License of Commercial and

Noncommercial AM, FM, and Television Licensees, 49

Rad. Reg. 2d (P & F) 740 (1981) (hereinafter Decision) ,

JA 6. The Commission did modify its original proposal

in two ways. First, it exempted commercial radio licen-

sees from the group that would be subject to the long-

form audit requirement. Decision at 648-649, JA 14-15.

This action was taken in coordination with the Commis-

sion’s decision to effect a substantial deregulation of com-

mercial radio. See Office of Communication of United

Church of Christ v. FCC, supra, 707 F.2d 1418. As a

result of this decision, approximately 8,100 of the 10,400

holders of broadcast licenses would be exempt from the

long-form audit, and this audit would thus fall on only

one percent of all broadcast licensees 2ach year. Brief

3 In this opinion the Commission’s new plan will be referred

to as the “postcard renewal plan.”

3la

for petitioners at 19. Second, the Commission reduced

the percentage of licensees subject to the random on-site

inspections from 16 percent to 10 percent annually. De-

cision at 752, JA 18.

Approving this overhaul of the renewal process, the

Commission explicitly noted that the new plan “was never

intended to change our current substantive requirements

for the broadcast industry, and * * * does not alter the

substance of licensee obligations to serve the public in-

terest.” Id. at 748, JA 14. See id. at 741, JA 7. The

Commission also expressed its belief that its “ability to

make [the] public interest finding is preserved through

the SRA [Simplified Renewal Application].” Jd. at 748,

JA 14.

After the Commission denied a petition to reconsider

this decision, Revision of Application for Renewal of

License of Commercial and Noncommercial AM, FM, and

Television Licensees, 87 FCC2d 1127 (1981),* petitioners

Black Citizens for a Fair Media et al. brought their

challenge to the Commission before this court.

II. STANDARD OF REVIEW

The Communications Act grants to the Commission

broad authority to regulate broadcasting so as to serve

the “public interest, convenience, and necessity.” 47

U.S.C. § 303. Providing little more than this general

touchstone for guidance, Congress sought to ensure that

the Commission was unfettered in its endeavors to keep

astride “a field of enterprise, the dominant characteristic

of which was the rapid pace of its unfolding.” Nat’l

Broadcasting Co. v. United States, 319 U.S. 190, 219

(1948). Though the public interest standard is not a

roving license to do good, and takes directive meaning

from its statutory scheme, see Office of Communication of

* Henry Geller, a petitioner in this action, brought the peti-

tion for reconsideration before the Commission.

32a

United Church of Christ v. FCC, supra, 707 F.2d at 1423-

1424, the Communications Act should nonetheless be read

as delegating to the Commission substantial authority for

elaborating the precise meaning of the public interest

standard.

When this court reviews Commission rules promulgated

pursuant to such congressional delegations of power, we

do not substitute our judgment for that of the Commis-

sion as to whether the rules under review are the best

method of serving the public interest. Rather, we review

the Commission’s action to determine whether the Com-

mission exercised reasoned decisionmaking and whether it

exceeded its statutory authority. Herwig v. Ray, 455 U.S.

265, 275 (1982); Gray Panthers v. Schweiker, 453 U.S.

84, 44 (1981); Batterton v. Francis, 482 U.S. 416, 426

(1977).

The parameters of reasoned decisionmaking are read-

ily discernible in the case law. The mandate of the Ad-

ministrative Procedure Act (APA) that a reviewing

court set aside agency action found to be “arbitrary,

capricious, or an abuse of discretion,” 5 U.S.C. § 706

(2) (A), requires the court to ensure that the agency’s

decision “is rational, has support in the record, and is

based on a consideration of relevant factors.” Telocator

Network of America v. FCC, 691 F.2d 525, 587 (D.C.

Cir. 1982). See Citizens to Preserve Overton Park, Inc.

v. Volpe, 401 U.S. 402, 416 (1971) ; Office of Communica-

tion of United Church of Christ v. FCC, supra, 707 F.2d

at 1424-1426.

APA’s requirement that agency action not be “in ex-

cess of statutory * * * authority,” 5 U.S.C. § 706(2)(C),

is more murky in its parameters. Essentially, the re-

viewing court must ensure that the agency action at

issue comports with congressional intent; agency action

inconsistent with congressional intent exceeds the limits

of an agency’s delegated authority. See Planned Parent-

hood Federation of America v. Heckler, 712 F.2d 660,

33a

655-656 (D.C. Cir. 1988); Office of Communication of

United Church of Christ v. FCC, supra, 707 F.2d at

1422-1424.

That this principle is not altogether clear from the case

law is largely the result of the distortive gravitational

pulls of two opposing platitudes. Pulling in one direction

is the maxim that a reviewing court should defer to an

agency’s interpretation of its governing statute. See

Udall v. Tallman, 380 U.S. 1, 16 (1965). Exerting a

countervailing pull is the maxim that courts are always

tle final authorities on issues of statutory construction.

See FTC v. Colgate-Palmolive Co., 380 U.S. 374, 385

(1965). Though both are in a sense correct, neither as

formulated is sufficiently sensitive to the salient differ-

ences among situations in which a reviewing court must

evaluate an agency interpretation of its governing stat-

ute. And though both have been at times applied to the

process of deciding whether agency action has exceeded

statutory authority, neither governs review under this

test, as properly understood.

In every case in which a court reviews an agency in-

terpretation of its governing statute, the court must de-

cide in the first instance whether the agency or the court

The intent. of Congress governs this decision. Nat'l Wild-

life Federation v. Gorsuch, 698 F.2d 156, 167 (D.C. Cir.

34a

agency, and in this sense the court is the final authority

on issues of statutory construction. But once the court

has determined that Congress has made such a delegation,

the court may not substitute its judgment for that of

the agency as to whether the agency’s action expresses

the “best” understanding of the statutory term.*

This does not, however, exhaust the court’s interpretive

responsibility. Even when a court has decided that Con-

gress delegated to the agency the task of supplying the

meaning of a statutory term, the court must still ensure

that the meaning supplied does not contravene congres-

sional intent. Implicit in every congressional delegation

of power to interpret a statutory term is the limit that

the agency interpretation be consistent with the congres-

sional purposes expressed in the statutory scheme con-

taining the term at issue. Section 10 of the APA mandates

review to police this limit; the court must ensure that

agency action is not “in excess of statutory * * * au-

thority.” 5 U.S.C. § 706(2)(C). Since every agency rule

or decision presumptively carries the implicit message

that the agency views it as consistent with congressional

intent, the court should not defer to the agency view on

* See generally Monaghan, Marbury and the Administrative

35a.

Instead the reviewing court must itself evaluate the stat-

ute and its legislative history to determine whether ‘the

agency action at issue comports with the intent of Con-

gress. Reviewing courts “are not obliged to stand aside

and rubber-stamp their affirmance of administrative de-

cisions that they deem inconsistent with a statutory man-

date or that frustrate the congressional policy underlying

a statute. Such review is always properly within the ju-

dicial province, and courts would abdicate their responsi-

bility if they did not fully review such administrative

decisions.” NLRB v. Brown, 380 U.S. 278, 291-292 (1965)

(emphasis added). See Volkswagenwerk Aktiengelsell-

echaft v. FMC, 390 U.S. 261, 272 (1968) (quoting NLRB

v. Brown, supra, 380 U.S. at 291).

Recent Supreme Court cases have affirmed this princi-

ple in cases involving review of agency rules made pur-

suant to explicit congressional delegations of power to

elaborate the meaning of a statutory term. Applying the

“in excess of statutory * * * authority” standard of Sec-

tion 10 of the APA, the Court in every case measured the

agency rule against the Court’s interpretation of congres-

sional intent. Herwig v. Ray, supra, 455 U.S. at 275-276;

Gray Panthers v. Schweiker, supra, 453 U.S. at 44, 45-

46; Batterton v. Francis, supra, 482 U.S. at 428 (Ad-

ministrator “could not, for example, pass a regulation

that would * * * defeat the purposes of the * * * pro-

gram”). See also FCC v. WNCN Listeners Guild, 450

U.S. 582, 596 (1981) (“As we see it, the Commission’s

Policy Statement is in harmony with” cases defining the

purposes of the Communications Act.) ; Espinoza v. Farah

Mfg. Co., 414 U.S. 86, 94-95 (1973) (application of

agency guideline found to be inconsistent with congres-

sional intent); Morton v. Ruiz, 415 U.S. 199, 234-237

(1974) (agency rule placing geographical limit on eli-

gibility of potential beneficiaries of statute must be con-

sistent with congressional intent) ; American Ship Building

Co. v. NLRB, 380 U.S. 300, 316-317 (1965) (no fair

“

i” Ms

SS Tee, Se eee

36a

construction of statute permits agency interpretation of

statutory term).

Thus, review under the “in excess of statutory * * °

authority” standard requires the court neither to defer to

the agency interpretation nor to exercise completely inde-

pendent judgment as to the statutory term at issue.

Rather, the court measures the agency’s interpretation of

the term against the court’s interpretation of congres-

sional intent. If the court finds the agéncy reading con-

sistent with congressional intent, the court’s inquiry is

over; the court does not determine whether the agency

interpretation is the best path to the goals Congress set.

If, however, the reviewing court finds that the agency

interpretation contravenes a statutory mandate or frus-

trates congressional purposes underlying a statute, the

court is duty bound to invalidate the agency interpreta-

tion.

In the present case Congress has left to the Commission

much of the authority for elaborating the meaning of the

public interest standard. Pursuant to this delegated power,

the Commission has promulgated the postcard renewal

plan that petitioners challenge in this proceeding. On

review this court must determine whether the postcard

renewa!, plan is consistent with the statutory mandates

am @aderlying congressional purposes of the Communi-

cwtiona Act. If this court finds that the plan contravenes

the intent of Congress, we must follow the command of

Section 10 of the APA and invalidate the plan because it

is “in excess of statutory * * * authority.”’

Ill. REVIEW OF THE MERITS

In this case petitioners Black Citizens for a Fair Media

et al. make the straightforward claim that the Commis-

T Because I would hold that the postcard renewal plan

37a

sion’s postcard renewal plan contravenes the intent of the

Communications Act because the plan does not require the

Commission to ensure that each renewal applicant has

met the Act’s public interest programming requirements.

This court must analyze the statutory mandates and un-

derlying congressional purposes of the Communications

Act to determine whether the Act places on the Commis-

sion the affirmative duty of examining the programming

of every renewal applicant. If the postcard renewal plan

is found to frustrate congressional intent, it must fail.

A. The Public Trust Concept

A broadcasting license is a public trust. The licensee

obtains “the free and exclusive use of a valuable part of

the public domain,” and in return assumes a duty to

serve the public interest by this use. See Office of Com-

munication of United Church of Christ v. FCC, 359 F.2d

997, 1008 (D.C. Cir. 1966) (hereinafter United Church

I). Congressman White, a sponsor of the original Radio

Act that became the Communications Act in 1934, articu-

lated this understanding more than half a century ago on

the floor of the House of Representatives: “The right of

the public to service is superior to the right of any indi-

vidual * * *. If enacted into law, the broadcasting privi-

lege will not be a right of selfishness. It will rest upon

an assurance of public interest to be served.” 67 Cong.

Rec. 5479 (1926) (remarks of Rep. White). Amending

the Communications Act in 1959, Congress reaffirmed that

the public trust concept is the animating principle of the

Act. The Senate report accompanying the amendment

stated: “Broadcast frequencies are limited and, therefore,

they have been necessarily considered a public trust.

Every licensee who is fortunate in obtaining a license is

mandated to operate in the public interest.” S. Rep. No.

562, 86th Cong., 1st Sess. 8 (1959). And the public trust

concept has long guided courts interpreting the Act. See

Red Lion Broadcasting Co. v. FCC, 396 U.S. 367, 375-377

38a

(1969) (hereinafter Red Lion) ; Office of Communication

of United Church of Christ v. FCC, 425 F.2d 548, 548

(D.C. Cir. 1969) (hereinafter United Church II) ; United

Church I, supra, 359 F.2d at 1003. These courts have

recognized that licensees are “temporary permittees—

fiduciaries—of a great public resource * * *,” United

Church II, supra, 425 F.2d at 548, whose public trustee

status is “subject to termination for breach of duty.”

United Church I, supra, 359 F.2d at 1003.

The public interest standard imposes a programming

obligation on licensees. Though the paucity of illumina-

tive legislative history accompanying the origina] Com-

munications Act did not make this requirement entirely

clear, subsequent judicial, congressional, and agency in-

terpretations have clarified the existence and attributes of

the programming requirement. In the landmark Nat'l

Broadcasting Co. v. United States, supra, 319 U.S. 190,

Justice Frankfurter, writing for the Court, held that the

regulatory scheme established in the Act necessarily im-

plied a duty to inquire into licensee programming.’ Subse-

* The opinion stated:

[Wle are asked to regard the Commission as a kind of

traffic officer, policing the wave lengths to prevent sta-

tions from interfering with each other. But the Act does

not restrict the Commission merely to supervision of the

traffic. It puts upon the Commission the burden of deter-

mining the composition of that traffic. * * *

* * * “An important element of public interest

convenience affecting the issue of a license is the

of the licensee to render the best practicable

: cI

ihe

Hie

39a

quent Congresses have added their imprimatur to this

reading of the Act. In the course of amending the Act’s

equal time provision, 47 U.S.C. § 315, in 1959 to exempt

candidate appearances on news broadcasts, Congress was

careful to state that this new law did not relieve broad-

casters of “the obligation imposed upon them under this

Act to operate in the public interest and to afford reason-

able opportunity for the discussion of conflicting views on

issues of public importance.” Act of Sept. 14, 1959, Pub.

L. No. 86-271, §1, 73 Stat. 557, amending 47 U.S.C.

§ 315(a). This language, as the Supreme Court noted in

Red Lion, supra, reveals that the amending Congress read

the public interest standard as obliging licensees to meet

certain programming requirements. The Commission

cially and technically qualified to operate a station? Since

the very inception of federal regulation [of] radio, com-

parative considerations as to the services to be rendered

have governed the application of the standard of “public

interest, convenience, or necessity.” * * *

Nat'l Broadcasting Co. v. United States, 319 U.S. 190, 215-

217 (1948).

Commentators have also recognized that the structure of

the Act’s regulatory scheme, governed by the public trust

concept, necessarily implies the power to examine licensee

programming. See S. Brever & R. STEWART, ADMINISTRATIVE

LAW AND REGULATORY PoLicy 874 (1979) (“Surely a Com-

mission asked to award licenses in the public interest must

have ‘good programming’ as some kind of objective; to ignore

programming entirely would make a mockery of its mission.”).

* Red Lion Broadcasting Co. v. FCC, 395 U.S. 867, 380

(1969) (“public interest” creates programming duty); see

Banzhaf v. FCC, 405 F.2d 1082, 1095 n.49 (D.C. Cir. 1968)

(“At the very least, this language appears to be an acknowl-

edgment of and in the settled Commission and

judicial construction that the public interest standard applies

to content.”). Such subsequent dec-

entitled to “great weight in statutory construction.” Red

Lion, supra, 395 U.S. at 380; accord, FHA v. The Darlington,

Inc., 3568 U.S. 84, 90 (1958).

40a

itself has repeatedly articulated its understanding that a

programming obligation inheres in the public interest

standard.” And in the companion to this case, Office of

Communication of United Church of Christ v. FCC,

supra, 707 F.2d at 1426-1430, we reaffirmed that the

Commission is correct in this understanding.

Though its precise contours are not fully mapped, the

programming aspect of the public interest obligation

essentially requires the licensee to provide nonentertain-

ment programming that responds to the needs of the

licensee’s broadcast community. Jd.“ The Communica-

tions Act directs the Commission to police licensees to

” See, e.g., En Bane Programming Inquiry, 44 FCC 23038

(1960); Television Program Form, 5 FCC2d 175 (1966);

Renewal of Broadcast Licenses, 44 FCC2d 405 (1978); FCC

Form 303 Report and Order, 59 FCC2d 750 (1976). See also

FCC policy statements discussed in Office of Communication

of United Church of Christ v. FCC, 107 F.2d 1413, 1429 n.50

(D.C. Cir. 1983). Congress has never overturned, or even

Zemel v. Rusk, 381 US. 1, 11-12 (1965).

11 Broadcasters must also meet programming obligations

4la

ensure that they meet their public interest obligations.

See 47 U.S.C. §§ 3038, 307, 309, 315. Reviewing a licen-

see’s renewal application, the Commission must therefore

determine whether the licensee has fulfilled these obliga-

tions to program in the public interest. The licensee in a

renewal proceeding must “literally run on his record.”

United Church I, swpra, 359 F.2d at 1007.

B. The Postcard Renewal Plan

The Commission acknowledges that “({a] broadcaster

seeking renewal must run on his record, and the focus

of that record is whether his programming has served the

public interest.” Brief for respondents at 14 (emphasis

added). Yet the Commission’s postcard renewal plan

eliminates from the standard renewal application form

all questions relating to programming. The tension be-

tween the Commission’s words and its deeds is obvious;

while admitting that past programming is central to the

renewal decision, the Commission proposes a scheme that

makes no individualized inquiry into the programming of

renewal applicants. The Commission seeks to resolve this

tension with an argument of the “have your cake and

eat it too” variety. What the Commission. claims is that

the Act imposes on it only a duty to find that each ap-

plicant operates in the public interest—not specifically

to inquire into each applicant’s programming—and that

the system of random audits and spot checks, supple-

mented by complaints from the public, will deter most

potential violators of the programming obligation, flag

those not deterred, and thereby ensure that licensees pro-

gram in the public interest while eliminating unneeded

paperwork. Given this alternative way of ensuring that

programming requirements are met, “(t]he questions

contained on the SRA [Simplified Renewal Application]

would provide the Commission with adequate informa-

tion to make its public interest finding consistent with

the Communications Act.” Decision at 748, JA 9.

“)

42a

The rationale for this dramatic shift in the Commis-

sion’s approach to enforcement is not without some al-

lure. The Commission asserts that under the prior re-

newal system, which inquired deeply into licensee pro-

gramming, almost all renewal applicants were found to

have met the programming requirements. Moreover, com-

plaints from the broadcaster’s community are currently

the primary means by which the Commission learns of

broadcaster failure to meet programming requirements.

Based on these facts, the Commission determined that a

combination of deterrence through the threat of audit or

inspection and reliance on public complaints would suf-

fice to ensure that licensees programmed in the public

interest. Thus, although a licensee would still run on its

record at renewal time, the Commission would presume,

absent public complaint, that the audit and inspection

threat had exerted a deterrent force sufficient to have

kept the license faithful to its programming obligations

as a public trustee.

C. The Statutory Mandate and Underlying Congres-

sional Purposes

To ascertain whether the Commission has exceeded its

statutory authority, the postcard renewal plan must be

43a

Commission shall determine, in the case of each applica-

tion filed with it * * *, whether the public interest * * *

will be served by the granting of such application.” I[d.

§ 309(a) (emphasis added). These words impose on the

Commission a mandatory duty to make sure that each

renewal applicant has operated in the public interest.

FCC v. WNCN Listeners Guild, supra, 450 U.S. at 600

(“the Commission does not merely assume but affirma-

tively determines that the requested renewal * * * will

serve the public interest”)."* When these sections are

read together with the programming requirement that

the public interest standard imposes on each licensee, it

becomes clear that the statutory scheme requires the

Commission to find that each renewal applicant is pro-

viding programming that satisfies the public interest

standard.

Reviewing courts have consistently read the statute in

exactly this way. In Alianza Federal de Mercedes v.

FCC, 539 F.2d 732, 735 (D.C. Cir. 1976), this court

noted that “it has long been basic to the understanding

past

rs oh found in United Church I, supra, that “in a

past performance is [the Commis-

aa | best criterion.” 359 F.2d at 1007. See also id. at

dda

In those cases the court was doing no more than follow-

ing a long-standing Commission interpretation. Almost

a quarter-century ago, in En Banc Programming Inquiry,

44 FCC 2303, 2310 (1960), the Commission set out this

interpretation of the Act:

[Faithful discharge of its statutory responsibili-

ties is absolutely necessary in connection with the

implacable requirement that the Commission approve

no such application for licenses unless it finds that

“public interest, convenience, and necessity would be

served.” While the public interest standard does not

provide a blueprint of all of the situations to which

it may apply, it does contain a sufficiently precise

definition of authority so as to enable the Commis-

sion to properly deal with the many and varied oc-

casions which may give rise to its application. A

significant element of the public interest is the

broadcaster’s service to the community. * * *

(Emphasis added.) The policy statement bears repeat-

ing: the statute requires that “no * * * application” be

approved unless the Commission finds that the public in-

terest would be served, a “significant element” of which

is the “broadcaster’s service to the community.” The

identical interpretation of the statute permeates later

Commission rules and policy statement. See AM & FM

4Sa

In each case involving a renewal application the

Commission is required to review the licensee’s over-

all performance during the preceding license term

and to make an affirmative finding that grant of the

subject application would serve the public interest,

convenience, and necessity. *

* * * Sufficient information upon which to assess

the licensee’s performance and to predicate the re-

eo public interest finding must continue to be

Id. at 752 (emphasis added). These quotations from

Commission rules and policy statements leave little doubt

that, prior to its recent about-face, the Commission con-

sistently read the Act as mandating an inquiry into the

programming of each and every renewal applicant.”

That the Commission for so long held this view of the

Act is not surprising. This reading reflects the centrality

of the “public trust” concept that animates the regula-

tory scheme. Each licensee receives a slice of the public

domain extraordinarily lucrative in its potential, and

must in return provide programming that serves the

needs of its broadcast community. The Act directs the

Commission to ensure that each licensee meets its obliga-

tions as a public trustee. The Act, furthermore, makes

explicit the requirement that an affirmative, individualized

public interest finding be made for each licensee. Since

18 Additional evidence that the Commission read the statute

this way can be found in statements contained in FCC license

renewal applications. Applicat.on an from 1974, 1976, and

1980 contain the following

Salles Sas Oe see ee a en Se

serve the public interest, convenience and ew Pro-

46a

the Commission carries out this statutory duty primarily

through the renewal process, the process must be struc-

tured to permit the Commission to ensure that each

licensee lives up to its public trust obligations. The Com-

mission can only do so by evaluating the programming of

each licensee. To further the congressional purposes im-

plicit in the public trust concept, the affirmative, indi-

vidualized public. interest finding that Sections 307 and

309 of the Act mandate must be read as requiring the

Commission to evaluate the programming of each renewal

applicant.”

4 Long congressional acquiescence in this consistent agency

and judicial interpretation provides persuasive evidence that

this interpretation is the one intended by Congress. Haig v.

Agee, supra note 10, 453 U.S. at 300; Red Lion, supra note 9,

395 U.S. at 381; Zemel v. Rusk, supra note 10, 381 U.S. at 11.

Haig v. Agee stated that “congressional acquiescence may

sometimes be found from nothing more than silence in the

face of an administrative policy.” 453 U.S. at 300. More

recently, however, the Supreme Court stressed, in Bob Jones

University v. United States, —— U.S. ——, ——, 51 U.S.LW.

perpen vee tan meth gir er ft familiarity

with that interpretation.

In the present case, evidence exists of congressiona! famili-

47a

What is surprising, rather, is that the Commission

would now seek to undermine this understanding of the

Act—and that the majority of this panel would go along.

The Commission attempts to achieve its goal of rewriting

the statute by a process of recharacterizing its earlier

view of its statutory responsibilities. The Commission

now claims that when it stated previously that program-

ming inquiries were essential to the renewal process, it

was not interpreting the statute per se, but merely exer-

cising its broad discretion to propound whatever proce-

dures it thought appropriate under the public interest

standard. Now in an equally permissible exercise of dis-

cretion, the Commission claims, it is discarding the old

programming inquiries as cumbersome and replacing

them with the postcard renewal plan. To support this

shift in approach the Commission claims that the statute

does not mandate a renewal form that inquires into the

programming of each applicant and that the random

audits and inspections, supplemented by public complaints,

will permit the Commission to meet its duty of ensuring

amending process did Congress express disapproval of the

long-standing Commission interpretation of the Act as requir-

ing individualized programming inquiries. “Congress is pre-

sumed to be aware of an administrative or judicial interpreta-

tion of a statute and to adopt that interpretation when it

re-enacts a statute without change.” Merrill Lynch, Pierce,

Fenner & Smith, Inc. v. Curran, 456 U.S. 353, 382 n.66 (1982).

intended no change in the Commission’s “duty to consider, in

the case of a station which has been in operation and is apply-

48a

programming in the public interest. Neither prong of

the Commission’s rationale withstands analysis.

1. The statute requires a programming inquiry.

Both the Commission and the majority opinion here

assert that the Communications Act does not require the

Commission’s renewal application to inquire into each

applicant’s programming. Casting the issue in this way,

they avoid the real question that must be answered in

this case: whether the Commission can, consistent with

the Communications Act, make no inquiry into the pro-

gramming of 99 percent of its renewal applicants. With-

out a doubt, the precise content of the renewal applica-

tion form is left largely to the discretion of the Commis-

sion. But it does not follow from this proposition that

the Commission need not review the programming of each

renewal applicant. The Commission’s plan is only valid

if the Act does not mandate such individualized inquiry.

Thus, even if the Commission can show that the statutory

words do not explicitly require a renewal application

with programming questions, the Commission has not

thereby proven that the statutory scheme does not re-

quire an inquiry into the programming of each renewal

applicant. The reasoning of this court’s majority opinion

is directed only toward proving the former, and therefore

does not address itself to the critical issue in this case.

Nonetheless, since the Commission’s plan does not pro-

vide for an examination of the programming of each re-

newal applicant, it must be assumed tnat the Commission

and the majority here have implicitly decided that the

Act does not mandate such individualized inquiry. It has

already been demonstrated that this view flatly contra-

dicts the position that the Commission has held and ex-

pounded for at least the past 40 years. To the extent that

this court’s analysis can be viewed as implicitly addressed

to this underlying issue of whether the Act mandates an

“

htt a6 ssf

49a

inquiry into each applicant’s programming, that analysis

also falls of its own weight.

The majority correctly notes that nothing on the face

of the Act explicitly requires that programming inquiries

be included on all applications for renewal. Majority Opin-

ion (Maj. Op.) at 9. Section 308(b), a non-exhaustive

list of items into which the Commission may inquire,

is the centerpiece of this argument. The section does not

include programming inquiries on its list, and does leave

the Commission with discretion as to what information

credited “plain meaning rule” in its worst aspect. See

United States v. American Trucking Ase’ns, 310 U.S. 534

(1940). Section 308 must take its meaning from the

regulatory scheme of which it forms a part, and from

the Commission to inquire or not as it saw fit, but to

50a

The majority draws similarly faulty lessons from its

thin reading of subsequent congressional and agency in-

terpretations of the Act. In the 1952 amendments to the

Act, on which the majority places significant weight,

Congress did seek to “reduce the regulatory burden,”

Maj. Op. at 10, but not in the way that the majority

claims. Prior to the amendments the Act required that

renewal applications “be limited to and governed by the

same considerations and practice which affects the grant-

ing of original applications.” The amendment substituted

for this yardstick the broader “public interest” standard

that is now in Section 307. This revision eased the regu-

latory burden by freeing the Commission from making

inquiries that, while sensible when addressed to initial

applicants for licenses, .*re not sensible when addressed

to renewal applicants. For example, the pre-1952 practice

required the Commission to consider the financial ability

of both initial and renewal applicants to construct a

broadcast station. A renewal applicant, however, would

already have built the station, and inquiry into its finan-

cial ability to do so would thus be senseless. See S. Rep.

No. 44, 82d Cong., Ist Sess. 7 (1951).

These eminently reasonable statutory adjustments can-

not be read to support the majority's extravagant claim

that Congress “wanted to * * * grant the FCC discre-

tion to tailor the renewal form as it saw fit.” Maj. Op.

at 10. And not only this logic, but also a page of history

refutes the majority’s interpretation. According to the

Senate report, the amendment to Section 307 “does not

Sila

in any way impair the Commission’s right and duty to

consider, in the case of a station which has been in opera-

tion and is applying for renewal, the over-all perform-

ance of that station against the broad standard of public

interest, convenience, and necessity.” S. Rep. No. 44,

supra, at 7."*

The majority also relies on two aspects of agency prac-

tice under the statute to support its holding: (i) the

Commission’s frequent addition and subtraction of ques-

tions on renewal forms, and (ii) the Commission’s policy

of policing compliance with the fairness doctrine on an

ad hoc basis, rather than through renewal applications.

In each case the majority’s reliance is misplaced.

Though the Commission has frequently modified the

questions on its renewal applications, in every case these

modifications merely refined the methods of inquiry by

which the Commission assured itself that renewal appli-

cants had met programming requirements. See Part I-A

supra. In its 1975 revision, which greatly simplified the

renewal application, the Commission articulated the un-

derstanding of the statute that guided its revision process:

* * * [Wle cannot, in the interest of alleviating

the paperwork burden faced by our licensees, pay

only lip wrvice to our statutory responsibilities.

re-regulatwry goal is the improvement of the renewal

process through the clarification and refinement of

our reporting requirements and the elimination of

antiquated and unnecessary disclosures. Sufficient

information upon which to assess the licensee’s per-

formance and to predicate the required public inter-

est finding must continue to be elicited. * * *

“If anything, the 1952 amendment facilitated broader in-

52a

FCC Form 308, supra, 59 FCC2d at 752. The power

to refine renewal inquiries is certainly within the Com-

mission’s discretion, and the majority.is correct when it

states that “if the FCC can add specific questions, it can

delete them when circumstances warrant.” Maj. Op. at

11. But it does not follow from that proposition that the

newal process into the power to obliterate its core func-

tion.

Nor does the Commission’s policy of ad hoc enforce-

ment of the fairness doctrine support the majority’s posi-

in Nat'l Citizens Committee for Broadcasting v. FCC,

567 F.2d 1095, 1111, 1116 (D.C. Cir. 1977), when the

cisions of licensees.” 567 F.2d at 1115. The on

rejected this approach because “review only at the time

views in a timely fashion and would deny the Commis-

sion the ability to ‘remedy violations before a flagrant

pattern of abuse develops.’” Jd. at 1116 (quoting Fair-

ness Report, 48 FCC2d 1, 18 (1974)).

S4a

support this view are neither jointly nor severally able

bear the weight that the majority must necessarily put

upon them to prove its point. Since the validity of the

Commission’s stated position that the Act does not re-

quire a renewal application with programming inquiries

hinges on the validity of this unstated, but necessary,

point, the Commission’s plan must fall. Until the Com-

mission’s postcard renewal plan, it had been thought be-

yond cavil that the Communications Act mandated in-

poses on broadcasters a requirement that “the American public

not be left uninformed,” Green v. FCC, 447 F.2d 323, 329

(D.C. Cir. 1971), and the public interest standard requires

55a

it said the Act imposed an affirmative duty

each renewal applicant programmed in the

interest, what it really meant was that the statute

it discretion to decide whether or not to make such

inquiry. The Commission, the courts, and implicitly

Congress, have consistently held the contrary view.

reading of the statute thai the majority has

ted to support the Commission’s new-found discre-

only reconfirms that the Commission has been right

the last 40 years and is wrong now.

2. The Commission’s alternative means of regulat-

ing programming is inadequate.

Though it eliminated individualized programming in-

Bagge

ee st.

interest. To meet this obligation the Commission pro-

posed the trio of long-form audit, on-site inspection, and

public participation. That approach would ensure pro-

gramming in the public interest, the Commission claimed,

because the threat of audit or inspection would provide

“sufficient inducement to comply” with programming re-

quirements, Decision at 750, JA 16, and because public

complaints—traditionally the “best vehicle” for apprising

the Commission of violations, Notice at 2, JA 48—would

flag those broadcasters not sufficiently induced by the

audit threat.

The Commission proposed this alternative enforcement

scheme in coordination with its decision to eliminate all

programming inquiries from renewal forms, and this al-

56a

The Commission asserts that the threat of audit or in-

spection will provide an element of deterrence sufficient

to ensure broadcasting in the public interest. And the

majority opinion agrees that “the regulatory environment

provides strong incentives for operation in the public inter-

est.” Maj. Op. at 17-18. In the light of the Commission’s

contemporaneous decision to exempt all commercial radio

licensees from the audit requirement, see Decision at 748-

749, JA 14-15, this claim is absurd. Of the 10,400 holders

of broadcast licenses in this country approximately 8,100

are commercial radio licensees. See brief for petitioners

Black Citizens for a Fair Media et al. at 25 (citing FCC,

46TH ANNUAL REPORT/FISCAL YEAR 1980 at 90). Thus

virtually 80 percent of all licensees are not subject to the

mechanism that the FCC claims will deter broadcaster

misfeasance. The remaining 20 percent of broadcasters—

commercial television and noncommercial radio and tele-

%* Ten percent of all licensees, including commercial radio

stations, will be subject to the on-site inspections. Decision

at 767, JA 23. These inspections are, however, primarily

concerned with the technical aspects of They

will involve programming only to the extent of the

licenses’s public file to make sure it contains al] pro-

ii}

57a

most violators of the programming obligation are caught

is only valid if it can be shown that the public complains

about most violators. The Commission has not even at-

tempted to make such a showing. And it is unlikely that

it could do so. The high cost of participation, in time

pation.” United Church I, supra, 359 F.2d at 1006. Re-

liance on public complaints simply does not assure that

most broadcasters will present programming that meets

public interest obligations.

The postcard renewal plan essentially creates a pre-

sumption that a renewa! applicant has met its public in-

terest programming obligations. The plan holds out some

possibility of deterrence, but the odds are long. Twenty

percent of licensees, the noncommercial broadcasters and

commercial television stations, face a one in 20 chance of

audit and a one in ten chance of inspection of their pub-

lic files. Eighty percent of licensees, the

radio stations, face only the one in ten risk of inspection.

Most of the burden for monitoring licensee programming

under this plan rests with the public. Absent public com-

plaint, the Commission will “assume continued compli-

ance.” Decision at 748, JA 14. .

58a

not merely assume but affirmatively determines that the

requested renewal * * * will serve the public interest’) ;

United Church I, supra, 359 F.2d at 1008 (“The statu-

tory public interest finding cannot be inferred from a

statement of the obvious truth that a properly operated

station will serve the public interest.”). The postcard re-

newal plans falls far short of the statute’s mandate that

the Commission ensure that each renewal applicant has

presented programming in the public interest. In so do-

ing, the plan frustrates the essential purpose of the Com-

munications Act: assuring that the public, the owner of

the airwaves, receives programming that meets commu-

not meet the Act’s requirements, and this court errs in

upholding it.

IV. CONCLUSION

Like many of its sister agencies, the Commission has

in recent years taken up the sword against |

federal regulatory policies. In Office of Communication

of United Church of Christ v. FCC, supra, 707 F.2d 1418,

this court approved most of the Commission’s efforts to

;

59a

of a traffic cop, policing to ensure that licensees meet

technical requirements, but doing little more. Forty years

ago, Justice Frankfurter rejected such a narrow concep-

tion of the Commission’s duties under the Act: “the Act

does not restrict the Commission merely to supervision of

the traffic. It puts upon the Commission the burden of

determining the composition of that traffic.” Nat’l Broad-

casting Co. v. United States, supra, 319 U.S. at 215-216.

This burden has proven to be substantial. Without a

doubt the postcard renewal plan makes life easier for both

the regulators and the regulated. But the statute im-

poses this burden, and the Commission is not free to shirk

it. To do so is to place administrative convenience ahead

of the protection of the public interest that Congress in-

tended in this regulatory scheme. The Commission’s de-

cision to favor administrative convenience is troubling.

The decision indicates that the Commission has—like the

broadcasters before it, see United Church I, supra, 359

F.2d at 1003—lost sight of the fact that a broadcast li-

cense is a public trust. The public, as owner of the air- .

waves, deserves more protection than the Commission’s

postcard renewal plan provides. The Communications

Act mandates this protection in the form of an examina-

tion of the programming of each renewal applicant. This

court errs in sanctioning the Commission’s effort to shirk

these statutory responsibilities.

I respectfully dissent.

60a

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

No. 81-1710 September Term, 1983

Black Citizens for a Fair Media, et al.

Petitioners

v. United States Court of Appeals

for the District of Cotumbia

Federal Communications and Filed Dec 12 1983

United States of America se ~ ate

Respondents

American Brocasting Companies, Inc

National Association of Broadcasters

Office of Communication of the United

Church of Christ

CBS, Inc.

Argonaut Broadcasting Company, et al.

Intervenors

And Consolidated Case No. 81-2277

BEFORE: Wright and Bork, Circuit Judges and

Jameson*, Senior District Judge for the Dis-

trict of Montana

ORDER

On consideration of the Petition for Rehearing of Peti-

tioners Black Citizens for a Fair Media, et al., and Henry

Geller, filed November 9, 1983, it is :

ORDERED by the Court that the aforesaid Petition is

denied. q

Per Curiam

For The Court:

GEORGE A. FISHER, CLERK

By: /s/ Robert A. Bonner -

Robert A. Bonner 4

Chief Deputy Clerk %

*Sitting by designation pursuant to Title 28 U.S.C. § 294d). iz

6la

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

No. 81-1710 September Term, 1983

Black Citizens for a Fair Media, et al.

Petitioners

v. United States Court of Appeals

for the District of Columbia

Federal Communications and Piled Dec 12 1983

United States of America | —

Respondents

Office of Communication of the United

Church of Christ

CBS, Inc.

Argonaut Broadcasting Company, et al.

Intervenors

And Consolidated Case No. 81-2277

BEFORE: Robinson, Chief Judge; Wright, Tamm,

Wilkey, Wald, Mikva, Edwards, Ginsburg,

Bork, Scalia and Starr, Circuit Judges

ORDER

The Suggestion for Rehearing en banc of Petitioners

Black Citizens for a Fair Media, et al. and Henry Geller,

filed November 9, 1983, has been circulated to the full

court. A majority of the Court has not voted in favor of

the suggestion and, accordingly, it is ;

ORDERED by the Court en banc that the aforesaid sug- .

gestion is denied. 3

62a

Circuit Judge Wright, Wilkey, Wald and Edwards would

grant the suggestion. Chief Judge Robinson did not par-

ticipate in this Order.

*Sitting by designation pursuant to Title 28 U.S.C. § 294(d).

63a

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

No. 81-1710 September Term, 1983

Biack Citizens for a Fair Media, et al.

Petitioners

Federal Communications and

United States of America

Respondents

American Broadcasting Companies, Inc.

National Association of Broadcasters

National Radio Broadcasters Association

Office of Communication of the United

Church of Christ

CBS, Inc.

Argonaut Broadcasting Company, et al.

Intervenors Unmed States Court of Appeals

for the Dastrict of Cobwmbaa

No. 81-2277 p may tod

Henry Geller, =

Petitioner

Vv.

Federal Communications Commission

and United States of America,

Respodnents

National Association of Broadcasters,

Interv nor

Petitions for Review of an Order of the Federal Com-

munications Commission

BEFORE: Wright and Bork, Circuit Judges and

Jameson*, Senior District Judge for the Dis-

trict of Montana

eS!

These causes came on to be heard on petitions for

review or orders of the Federal Communications Commis-

64a

sion, and were argued by counsel. On consideration of the

foregoing, it is

ORDERED and ADJUDGED, by this Court, that the

orders of the Federal Communications Commission under

review herein are affirmed, for the reasons set forth in the

opinion for the Court filed herein this date.

Date: October 7, 1983.

Opinion for the Court filed by Circuit Judge Bork.

A true copy:

Test: George A. Fisucr

United States Court of Appeals

for the District of Columbia Circuit

By: /s/ Irvinia McDowery, Deputy Clerk

65a

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 73

[BC Docket No. 80-253; RM-2898; FCC 81-146]

Radio Broadcast Services; Revision of Applications for

Renewal of License of Commercial and Noncommercial

AM, FM, and Television Licensees

AGENCY: Federal Communications Commission.

ACTION: Final rule.

Report and Order — Proceeding Terminated

Adopted: March 26, 1981.

Released: May 11, 1981.

By the Commission: Chairman Ferris not participating;

Commissioner Fogarty concurring in the result.

1. On June 4, 1980, we adopted a Notice of Proposed

Rule Making in this proceeding proposing a dramatic shift

in our renewal procedures for broadcast licensees. FCC

80-327. We proposed to eliminate our detailed review of

lengthy renewal filings and to adopt a procedure which

uses a five-question simplified renewal application (SRA).

We have considered the comments and reply comments

filed in this proceeding and have determined that adoption

of this proposal is warranted.

Summary of Action Taken

2. In the Notice we observed that our proposal would

result in significant savings to the Commission and the in-

dustry without any diminution in the substsace of licensee

66a

service to the public. Congress had fashioned a broad

standard for licensing broadcast entities. The Communica-

tions Act provides that * * * the Commission shall deter-

mine, in the case of each application filed with it * * *°,

whether the public interest convenience and necessity will

be served by the granting of such application.” 47 U.S.C.

30%a). In order to acquire the data necessary to comply

with the public interest standard for renewal of license,

Congress provided that applications.

* * * shall set forth such facts as the Commission by

regulation may prescribe as to citizenship, character, and

financial, technical and other qualifications of the appli-

cant to operate the station.

47 U.S.C. 308(b).

3. We believe that we can discharge our obligations by

adopting a simplified renewal application (SRA) as the

standard application for renewal of license for all com-

mercial and noncommercial licensees. We are implement-

ing new enforcement measures to be used in conjunction

with the SRA. At least five percent of all commercial TV

and noncommercial licensees will be selected at random to

complete audit forms which are similar to the applications

they currently file for renewal of license. A second sample

of ail licensees, including commercial radio, will receive

on-site inspections by Field Operations Bureau (FOB) per-

sonnel. In those inspections FOB will continue its current

practice of monitoring the technical compliance of broad-

cast licensees and will also review public inspection files to

assure that licensees are complying with our requirements

for making particular data concerning their operations

available to the public. As a third measure, the Broadcast

Bureau may conduct on-site inspections of a number of

licensees who submit problem applications. Also, some

Broadcast Bureau field inspections may be undertaken to

67a

verify the data provided to us by licensees. As a separate

matter, we have considered a request filed by the National

Radio Broadcasters Association to simplify our re-

quirements related to the regular and pre- and post-filing

announcements made by broadcast licensees to apprise the

public that they are licensed every three years to serve the

public interest. Some relief in this area has been provided.

4. We are confident that this new process will prove

cost-effective for the Commission. Yet, we have not

adopted any changes in our technical, programming, or

other substantive requirements that licensees serve the

public interest. Only procedural requirements have been

altered.

Background

5. Over the years, as the Commission refined its

regulation of the broadcast industry, questions reflecting

the implementation of new or modified rules have made

their way into license renewal applications. For example,

advancement from the generalized requirement that

licensees know the needs of their communities set out in

the 1960 En Banc Programming Inquiry, 44 F.C.C. 3303,

to the implementation of fixed procedures for ascertaining

these needs as adopted in the Ascertainment Primer' in

1970, resulted in the addition of questions on the renewal

applications of commercial licensees. Our interest in the

presentation of public service announcements caused

questions on them to be added to the renewal applications.

Our concern with the television programming to meet the

needs of children and to assure that television licensees ex-

ercised restraint in the quantity of commercial matter

' Ascertainment af Community Problems, 27 F .C.C. 24 650 (1971).

68a

presented in conjunction with children’s programming was

reflected in questions added to the television renewal ap-

plication. And the Commission attempt to develop infor-

mation concerning the presentation of nonentertainment

television programming gave rise to the Annual Program-

ming Report (FCC Form 303-A) for use in conjunction

with the renewal application.

6. The Commission established firm processing

criteria for review of some of these matters. Thus,

licensees who presented or promised to present nonenter-

tainment programming falling below specific percentages

set out in § 0.281 of our rules (see Appendix G) had their

applications brought before the entire Commission for

review. Those applications could not be routinely pro-

cessed and granted under authority granted to the Chief of

the Broadcast Bureau. Section 0.281 (see Appendix G)

thresholds were established for the quantities of commer-

cial matter presented, with specific thresholds for com-

mercials presented in conjunction with children’s pro-

gramming. Guidelines were included to require Commis-

sion consideration of applicants whose presentation of

nonentertainment programming varied sharply from what

was proposed in the last renewal application, even if the

amount presented was greater than the threshold

percentages set out in Section 0.281.

7. This has led to the use of renewal applications re-

69a

8. A large staff was accumulated for review and

assessment of these materials. Additional clerical and sup-

port staff were required to separate portions of the ap-

plication; transmit those sections to various Branches

within the Broadcast Bureau; and to tabulate some of that

information. To the public, the industry, and the Commis-

sion this process evolved as the basis for this agency’s com-

pliance with our requirement to obtain the necessary infor-

mation from licensees upon which to determine whether a

grant of renewal of license was in the public interest.

9. In 1976, the Commission concluded the most recent

in a series of reviews of the renewal application process.

Revision of FCC Form 303, 33 RR 2d 1, recon. denied, 38

RR 2d 755 (1976). In that proceeding we eliminated several

questions which yielded information of marginal utility

and revised certain other questions to elicit only that infor-

mation needed by the Commission to discharge its respon-

sibilities. The direct outgrowth of that proceeding was

adoption of a new and separate renewal application for

commercial radio licensees, FCC Form 303-R. However,

that proceeding gave no consideration to the nature of the

renewal process, only to the efficacy of specific questions.

Thus, the renewal applications adopted therein continued

to elicit information on legal, technical, engineering, pro-

gramming and equal employment opportunity perform-

ance of each licensee. The Commission did eliminate the

required filing of balance sheets for commercial radio

licensees, but not for commercial TV.

10. Even with the changes adopted in 1976, the

renewal process remains costly and time consuming for

both licensees and the Commission. Broadcasters must

reduce their records to the form demanded by the applica-

tion. Once the application reaches the Commission, it

70a

must be checked in, routed to the various reviewing of-

fices, reviewed and ultimately stored. Realizing the costs

imposed on licensees by the treinnial filings and faced by

competing demands for our own scarce resources, the

Commission commenced a review of the renewal process

itself, to ascertain what reductions in the burdens to both

licensees and the government could be accomplished in a

manner consistent with our regulatory obligations under

the Communications Act. That review culminated in pro-

posals to trim the renewal application process to its essen-

tial elements. The proposals adopted represented no

change in substantive policies for service in the public

interest.

11. What we proposed to change were the procedures

by which we intend to monitor licensee compliance with

our rules and policies. We observed that over the years

most licensees have met or exceeded our operating

guidelines and a renewal process which has consumed

substantial Commission resources has resulted in few ap-

plications designated for hearing for failure to comply

with our rules and policies. We therefore proposed that

our processes be reduced to a level consistent with our

obligations under the Act. We proposed to eliminate cer-

tain filing requirements which resulted in the submission

of materials that were not reviewed by the Commission,

and to adopt procedures which would assure that licensees

continued to carry out their duties to serve the public

interest consistent with our rules.

Proposals.

12. Asset out in the Notice, we proposed new proceses

that would require less direct review by the Commission’s

staff yet insure licensee compliance with our substantive

requirements. Those processes would include implementa-

Tla

tion of a simplified renewal application in conjunction

with audits and field inspections of randomly selected

licensees to assure their compliance with our rules. The

questions contained on the SRA would provide the Com-

mission with adequate information to make its public in-

terest finding consistent with the Communications Act. It

would insure that all licensees comply with the Act’s alien

ownership requirements, have filed necessary equal

employment opportunity and ownership information with

the Commission, and are maintaining the additional data

required by our rules in their public inspection files.

13. In addition, we proposed that 5 percent of all af-

fected licensees be audited by filing a more detailed long

form. Our selection was to be drawn randomly so that no

licensee would know if it would be audited. Since the SRA

questions are integrated into the audit form, licensees

which received an audit form would not receive the SRA.

The audit forms proposed are similar to the current

renewal applications used by the Commission. However, a

number of questions of marginal utility on existing forms

were proposed for elimination. The audit form requires a

licensee to demonstrate how it has ascertained community

needs and interest, the programming service it has pro-

vided, including the amounts of nonentertainment pro-

gramming, commercial matter, PSA’s, and for television

licensees information concerning its programming to the

child audience. Finally, it requires the licensee to make

promises concerning its operation in the future in these

areas. These promises are to remain in effect until the

Commission is notified of a proposed change.

14. We also proposed that a sample of 16 percent of

all licensees be selected at random for visits by personnel

from our Field Operations Bureau to determine whether

zing Tel

72a

those licensees are in compliance with our technical re-

quirements and to review the contents of the public inspec-

tion file for completeness. This measure was proposed to

assure that licensees develop a record by which we can

review compliance with substantive Commission re-

quirements and that this material remains available to

members of the public. The public inspection file will con-

tain promises concerning the levels of nonentertainment

programming to be offered in the future, the amount of

commercial time that will be aired, and documentation of

a licensee’s compliance with our ascertainment re-

quirements and equal employment opportunity policies.

All of this and other material currently forming the basis

for review of a licensee’s past and proposed operations

would remain available for public and Commission

scrutiny. In this fashion, the integrity of our petition to

deny process is preserved and adequate data made

available to members of the public wishing to verify their

concerns regarding a licensee’s service to the public.

Finally, we proposed that our Broadcast Bureau staff

would conduct on-site inspections of some licensees sub-

mitting problem SRA’s and audit form applications. If

few such Broadcast Bureau inspections are necessary we

proposed to select at random an indefinite number of

licensees for on-site inspections to check the data filed in

their renewal applications and other forms for reliability.

15. Additionally, the Notice merged into this pro-

ceeding a proposal to simplify licensee public notice

obligations. This proposal was filed by the National Radio

Broadcasters Association, which contends that the process

by which licensees apprise the public of a licensee’s obliga-

tion to the public is too cumbersome and complicated. It

therefore proposed simplified announcements and timing

for the presentation of these announcements. A detailed

73a

review of these matters and of the comments submitted in

this proceeding follows. The Notice also proposed signifi-

cant other reductions in the burdens associated with the

renewal applications filed by all licensees. We suggested

that commercial television licensees be relieved of the

burden of submitting balance sheets at renewal time and

of some of the obligations associated with the Annual Pro-

gramming Report, FCC Form 303-A. Licensees would

submit their EEO Model Programs to the Commission on-

ly if our review of their employment profiles and other

pertinent data revealed a need for us to delve further into

this area. Other proposals were made and are discussed

below.

The Simplified Renewal Application.

16. Having discussed, in general, the proposals before

us, we turn our attention to the specific elements of the

proceeding. The Commission proposed to adopt a

simplified renewal application (SRA) which would elicit

basic information concerning each licensee from which we

would determine whether there were any impediments to a

grant of renewal. The sample SRA attached to the Notice

(Appendix A., therein), contained five questions.

— Question | identifies the licensee and its location.

— Question 2(a) asks whether the licensee has complied

with its obligation to file its Annual Employment Reports —

(FCC Form 395). This question assures that our Equal

Employment Opportunity Branch has the information

needed to review all licensees’ compliance with our non-

discrimination and affirmative action requirements. With

this information in hand, that Branch can act to defer an

application for renewal of license if an adequate concern

rergarding a licensee’s compliance is raised by those an-

nual filings.

74a

— Question 2(b) verifies that a current ownership report

is on file at the Commission for every licensee.

— Question 3, demonstrated that a licensee remains in

compliance with Section 310 of the Act relating to interests

of aliens and foreign governments in broadcasts licenses.

The Commission currently gathers information concern-

ing the citizenship of those who hold interests in a licensee

through the ownership reports they must file with the

Commission (FCC Forms 323 and 323-E). These forms

would adequately apprise the Commission of compliance

with Section 310 of the Act for most licensees. However,

licensee corporations having more than 50 stockholders

submit information only for stockholders who are officers

and directors or who hold more than one percent of the

stock of the corporation. The same is true for a party that

has more than a one percent ownership interest in a non-

commercial licensee and is not an officer or member of the

licensee’s governing board. The Act permits some alien

ownership of shares of a broadcast facility. However, it is

possible that one of a number of those holding such in-

terests could place a licensee out of compliance with Sec-

tion 310 of the Act by aggregation of these small interests.

That fact would not be disclosed by the licensee’s owner-

ship reports. In the Notice, we stated our view that the

burden of assuring compliance with Section 310 should be

placed upon the licensee.

— Question 4 confirms the applicant’s continued good

character, asking whether since the filing of the applicant’s

last renewal application an adverse finding was made, a

consent decree entered, or a final action approved by a

court or administrative body concerning particular con-

duct bearing on a licensee’s character. These include ac-

tions concerning felonies, lotteries, unlawful restraints or

75a

monopolies, unlawful combinations, contracts or

agreements in restraint of trade or the use of unfair

methods of competition. An affirmative answer to this

question would require a full description of that matter

and would result in scrutiny of that information at the

Commission.

— Question 5 protects the integrity of the petition to

deny process and the Commission’s own ability to review

for each licensee the full range of its compliance with our

rules. That question asks whether the applicant has placed

in its public inspection file at the appropriate times the

documentation required by §§ 73.3526 and 73.3527 of the

Commission’s rules. Those sections require licensees to re-

tain ana place in their public inspection files recent ap-

plications and associated exhibits filed with the Commis-

sion. Under those sections, other significant information

must also be kept on file and made available to the public

including: The Public and Broadcasting—A Procedure

Manual, which sets out licensee obligations to the public

and the avenues available to the public for consideration

of complaints; Annual Employment Reports (FCCC Form

395) for the last seven years; the licensee’s Equal Employ-

ment Opportunity Model Program; composite week logs

for verification of a licensee’s programming performance;

and a full range of ascertainment documentation.

COMMENTS?

17. The proposed adoption of the simplified renewal

application generated a wide range of comments. Action

?Where comment on a particular matter was light, the comments

may be integrated into the discussion of our resolution of that matter.

We have not set out every particular suggestion or comment, but all

comments have been considered. Finally, some minor or technical

suggestions which were unopposed are reflected in form or rule

changes without discussion in this Report and Order.

76a

for Children’s Television (ACT), the Office of Com-

munication— United Church of Christ (UCC), Citizens

Communication Center (CCC), National Citizens Com-

mittee for Broadcasting and Public Media Center (NCCB-

PMC) argued that the questions on the SRA do not pro-

vide an adequate basis from which the Commission can

reach the statutory finding that a grant of renewal serves

the “public interest, convenience and necessity.” 47 U.S.C.

307(d) and 309. In this vein NCCB-PMC argued that “at

the heart of this rule making is a switch from a renewal

form capable of measuring licensee performance and

capabilities to one whose only concern is whether a

licensee is a law violator * * *.” Citing Office of Com-

munication of the United Church of Christ v. FCC, 425

F.2d 543, 548 (D.C. Cir. 1969), NCCB-PMC argued that

by adoption of the proposed SRA the Commission would

be abdicating its responsibility to develop a meaningful

record on which to renew a license. CCC echoes this view

and adds that “the Commission itself has stated that

renewal application must normally provide the Commis-

sion with sufficient information to make its public interest

determination. Renewal of Broadcast License, 44 F.C.C.

2d 403, 406 (1973).” These comments posit that the Com-

mission cannot renew a broadcast license without a

detailed review of each licensee’s performance.

18. UCC and others add that adoption of the SRA

would result in grants of licenses beyond the three years

permitted under the Act. This view is based upon the con-

tention that the Commission would be discharging its

statutory obligations only in connection with licensees

who complete the audit form application. Thus, the actual

license term would be between the times that a licensee

completed the proposed audit forms. Since the statute pro-

vides only for 3-year license terms this course of action

would be prohibited.

Tla

19. National Black Media Coalition (NBMC) and

NCCB-PMC raise concerns regarding the statement in our

Notice that, “* * * we have found that the best vehicle for

bringing violations to our attention has been public par-

ticipation in our processes through petitions to deny, in-

formal objections, and complaints.” From this language,

they conclude that the Commission has shifted primary

regulatory responsibility for broadcasting to the public

and citizen’s group. NCCB-PMC argued that we should

consider the fairness to licensees of having their renewals

depend heavily on the existence or absence of concerned

citizens in their communities. NBMC maintains that:

The entire annual budgets of all the media reform

organizations, local and national, in the country would

not purchase a single sixty second commercial on the

Superbowl. It is fundamental that costs should be borne

by those capable of bearing them. No licensee has suffered

by bearing these costs thus far.

NBMC also contends that the SRA will deprive citizens

groups of easy access to licensee records, and that requir-

ing citizens to inspect station files locally to obtain infor-

mation will have a chilling effect on public participation.

In this regard, it states:

Even more serious is the problem faced by those, in-

cluding but not limited to, many of our affiliates who

desire to read licensee files without either the licensee’s

awareness that they are being read, or the licensee’s

awareness of which specific documents are being perused.

A station employee with a grievance, a union, a political

candidate, and a potential future job applicant are only

some of the many types of people with an interest in what

might be in a public file and a legitimate fear of reading

78a

the file itself. Often, these individuals rely on those of us

in Washington to go to the FCC and find the relevant in-

formation for them. More often they do without.

The Committee for Community Access (CCA) suggests

that if the SRA is adopted renewal information be sent to

the Commission but not looked at by Commission staffers

unless it is necessary to do so. NCCB-PMC urges us to re-

quire licensees to ship document

This text is long and has been trimmed here. Open the source document for the complete record.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.