Petition for Writ of Certiorari — Genesis Broadcasting Ltd. v. Federal Communications Commission

@5-371 | seman]

FILED

SEP 3 86

No. sniipinnias JOSEPH F. SPANIGL, AR

IN THE

Supreme Court of the Gnited States

OCTOBER TERM, 1985

GENESIS BROADCASTING LIMITED,

Pet: ‘ioner,

V.

FEDERAL COMMUNICATIONS COMMISSION

AND BROADCAST COMMUNICATIONS, INC.

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Robert B. Lubic*

Robert L. Olender

Lee J. Peltzman

Aaron Shainis

BARAFF, KOERNER, OLENDER

& HOCHBERG, P.C.

2033 M Street, N.W.

Suite #203

Washington, D.C. 20036

(202) 452-8200

Counsel for Petitioner

Genesis Broadcasting

Limited

*Counsel of Record

September 3, 1985

RE SE TOE ST

PRESS OF BYRON S. ADAMS, WASHINGTON, D.C. (202) 347-8203

QUESTION PRESENTED

The court of appeals affirmed an order of the Federal

Communications Commission (the “Commission” or

“FCC”) denying the application of Genesis Broadcasting

Limited (“Genesis”) for a construction permit for an FM

broadcast station at Evanston, Illinois, and granting the

application of Broadcast Communications, Inc. (“BCI” or

“WOJO”) for renewal of license for broadcast station WOJO

(FM). The Commission’s order was based on its conclusion

that the renewal applicant deserved a significant com-

parative preference, termed a “renewal expectancy,” for its

past broadcast record, which outweighed Genesis substan-

tial structural preferences for adding to the diversification of

ownership of the mass media and proposing the participa-

tion of all of its ownership in station management. The

following question is presented:

Whether, contrary to this Court’s decision in Ash-

backer Radio Corp. v. FCC, 326 U.S. 327 (1945), the

reviewing court ratified a licensing decision of the FCC

which, because of its result-oriented decisional bias in

favor of incumbent broadcasters, effectively nullified

petitioner's statutory right to a full and fair hearing

challenging an incumbent broadcaster in a comparative

renewal broadcast licensing proceeding.

ii

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED ......-.+-0+eeeeseeeeereeee i

TAPE OF AUTHORITIES ........ccccccccccccccccees ili

OPIMIONS BELOW 2... ccc cc ccc ccc ce cece cenenecccnes 1

ZUETION on ccc cccncdancesneussveusavasens o4 2

CONSTITUTIONAL AND STATUTORY PROVISIONS IN-

I nn co du n ve sen ah hake ee oN es ORR TASS 2

GQTATEMENT 20... ccccccccccswsccccccccsesenssseese 3

REASONS FOR GRANTING THE WRIT .........-+++++: 5

1. The Decision Below Effectively Nullified Genesis’

Statutory Right To A Full And Fair Hearing .... 5

2. The Decision Below Failed To Follow Those ‘udi-

cially Approved Standards For Determining Li-

censee Performance And Instead Created An

Irrebutable Presumption In Favor Of Renewal ... 8

COROT RINNE on cnc cecncnsnstenccenceecuweses seuss 11

APPENDIX

UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF

COLUMBIA CIRCUIT

Order of June 4, 1985 (denying suggestion for rehearing

ee PERO PTET CCT TT eee TT er te la

Judgement of March 29, 1984 (affirming the order of the

Federal Communications Commission) .......-.--: 2a

FEDERAL COMMUNICATIONS COMMISSION

Memorandum Opinion and Order, released March 20,

1984 (denying the application for review of the Decision

of the Review Board) ............ sc ecee cece cecees da

Decision of the Review Board, released April 4, 1983 . 9a

ili

TABLE OF AUTHORITIES

CASES:

Ashbacker Radio Corp. v. FCC, 326 U.S. 327 (1945). ..

Beebe v. FRC, 61 F.2d 914 AE ee eae

Office of Communication of the United Church of Christ v.

FCC, 359 F.2d 994 (D.C. Cir. 1966) .............

STATUTORY PROVISIONS:

MN ED ccc cca ccnncccncccce,

Communications Act of 1934, as amended,

yak os 65 ok 55650564 dain vsvnncnnce

Ee a sv k basco ncks tee:

PO ID nose cecccecccce.....

en re

Page

6

7

iv

Table of Authorities Continued

ADMINISTRATIVE DECISIONS AND REPORTS:

Broadcast Communications, Inc., 97 FCC 2d 61 (1984)

Broadcast Communications, Inc., 93 FCC 2d 1162 (Rev.

Seva Gc uks bee eess eu ReA Pee ae es

Cowles Broadcasting, Inc., 86 FCC 2d 993 (1981) ....

Cowles Florida Broadcasting, Inc., 60 FCC 2d 372

(1976), recon. den. 62 FCC 2d 953 (1977) ........

Formulation of Policies Relating to the Broadcast Re-

newal Applicant, Stemming from the Comparative

Hearing Process (Notice of Inquiry), 88 FCC 2d 120

PEE cnc AVR Kabs Shek eee Anee SeKeehabhanbauns

New Mexico Broadcasting Co., Inc., 88 FCC 2d 1469

EE Kk ua Uaan ee hee Khde Sede pares enw iiaKs

Report and Order on Deregulation of Radio, 84 FCC 2d

968, recon. denied, 87 FCC 2d 797 (1981) ........

Page

© OO

~l

IN THE

Supreme Court of the GQnited States

OCTOBER TERM, 1985

No. 85-____

GENESIS BROADCASTING LIMITED,

Petitioner,

V.

- FEDERAL COMMUNICATIONS COMMISSION

AND BROADCAST COMMUNICATIONS, INC.

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Genesis Broadcasting Limited* respectfully petitions for

a writ of certiorari to review the judgment of the United

States Court of Appeals for the District of Columbia Circuit.

OPINIONS BELOW

The judgment of the Court of Appeals appears in the

Appendix to this petition (App. B). Suggestion for rehear-

ing en banc was denied by Order entered June 4, 1985. The

Memorandum Opinion and Order of the Federal Communi-

*Genesis Broadcasting Limited has no parent, subsidiary or affili-

ated companies.

cations Commission, reported at 97 FCC 2d 61 (1984), also

appears in the Appendix to this petition (App. C).

JURISDICTION

The judgment of the United States Court of Appeals for

the District of Columbia Circuit was entered on March 29,

1985 (App. B). A timely suggestion for rehearing en banc

was denied on June 4, 1985 (App. A). The jurisdiction of this

Court is invoked under 47 U.S.C. § 402(j) and 28 U.S.C.

§ 1254(1).

CONSTITUTIONAL AND STATUTORY PROVISIONS

INVOLVED

United States Code, Title 47:

Section 301 - License for Radio Communication or

Transmission of Energy

It is the purpose of the this Act, among other things, to

maintain the control of the United States over all the chan-

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

channels, but not the ownership thereof, by persons for

limited periods of time, under licenses granted by Federal

authority, and no such license shall be construed to create

any right, beyond the terms, conditions, and periods of the

license ....

Section 304 - Waiver by Licensee

No station license shall be granted by the Commission

until the applicant therefor shall have signed a waiver of any

claim to the use of any particular frequency or of the elec-

tromagnetic spectrum as against the regulatory power of

the United States because of the previous use of the same,

whether by license or otherwise.

Section 309-Action Upon Applications; Form of and

Conditions Attached to Licensees

* * *

(e) If, in the case of any application to which subsection (a)

of this section applies, a substantial and material question of

fact is presented or the Commission for any reason is unable

to make the finding specified in such subsection, it shall

formally designate the application for hearing on the ground

or reasons then obtaining. . . . Any ‘.earing subsequently

held upon such application shall be a full hearing in which

the applicant and all other parties in interests shall be

permitted to participate. The burden of proceeding with the

cntroduction of evidence and the burden of proof shall be

upon the applicant, except that with respect to any issue

presented by a petition to deny or a petition to enlarge the

issues, such burdens shall be as determined by the

Commission.

STATEMENT

This petition seeks review of a judgment (App. B) affirm-

ing an order of the Federal Communications Commission

(App. C) denying the application of comparative challenger

Genesis and granting the application of incumbent broad-

caster, BCI for renewal of license for station WOJO, Evan-

ston, I[llinois.'

Petitioner Genesis is comprised of two local citizens, who,

in 1976, filed an application to supplant BCI as the operator

of WOJO because of their dissatisfaction with the minimal

broadcast service being provided by that station to its com-

munity of license. Genesis filed its application under the

belief that it would be awarded those full hearing rights

guaranteed to all comparative applicants under Section

‘Broadcast Communications, Inc., 97 FCC 2d 61 (1984).

309(e) of the Communications Act, 47 U.S.C. § 309(e), and

Ashbacker Redio Corp. v. FCC, 326 U.S. 327 (1945).

The Commission’ order granting BCI renewal was based

on the FCC’ conclusion that the incumbent's past broadcast

record at WOJO was substantial and that the licensee there-

fore deserved a renewal expectancy. The Commission’ find-

ing of substantial performance was made despite the follow-

ing evident ary facts:

(1) During the relevant license period, WOJO, the only

fulltime station operating in Evanston, a zity of over

80,000 people, broadcast exactly one puki ~ «ffairs pro-

gram addressing the ascertained problems and needs

of its community of license. Even that program was

broadcast only intermittently one-half hour per week.

J. A. 24°

(2) The station did virtually nothing to initiate news or

public affairs programming. In fact, BCI maintained no

news staff at the station. J. A. 154. Not surprisingly, as

a result, WOJO'’s broadcast of news and public affairs

placed it at or near the bottom compared to all of the

stations operating in its service area. J.A. 67, 87.

(3) Testimony from Evanston public officials, as well as

from other Evanston residents, established that WOJO

virtually ignored and was totally indifferent to the

needs and interests of its community of license. J.A.

123-124, 129-133, 182.

The Presiding Administrative Law Judge adequately

summed up BCI’ license term performance at WOJO when

he made the following conclusion:

*Citations to “J.A.” refer to the Joint Appendix in the court of

appeals.

BCI did not demonstrate that the quality of its pro-

gramming was superior or even substantial. On a quan-

titative basis, it is evident that the station generally

performed in the just acceptable range. J.A. 188.

Faced with the incumbent broadcaster's record of mini-

mal service, and recognizing Genesis’ structural com-

parative strengths, the FCC manufactured a “substantial”

broadcast record for the renewal applicant. The Commis-

sion offered excuses for WOJO’s programming failures,

while, ai the same time, it reviewed the record for anything

it could find which could be cited in support of a finding of

above average performance. The Commission’ result-ori-

ented decision focused on some non-broadcast civic ac-

tivities engaged in by the station (many of which occurred

prior to the commencement of the relevant license period),

decade old positive statements from individuals who did not

submit evidence at the hearing, and the broadcast of re-

ligious.services to meet ascertained local needs.

Genesis appealed the Commission's order to the United

States Court of Appeals for the District of Columbia Circuit.

Principal among the numerous errors cited by Genesis as

the basis for its appeal was the Commission’ failure to

follow its own enunciated renewal standards, which it had

formerly declared it would rely on in determining the pres-

ence or absence of a renewal expectancy.

The court affirmed the Commission without issuing an

opinion. Genesis timely filed a suggestion for rehearing en

banc, which was also denied without opinion on June 4,

1985.

REASONS FOR GRANTING THE WRIT

1. The Decision Below Effectively Nullified Genesis’ Stat-

utory Right To A Full and Fair Hearing.

Repeatedly, over the years, courts have noted with disap-

proval the FCC's attempts to set up an operational bias in

favor of incumbent licensees and the consequential erection

of a presumption of renewal that is inconsistent with those

full hearing Ashbacker rights guaranteed to challengers to

renewal applicants under Section 309(e) of the Communica-

tions Act.* Even in those cases where they have affirmed the

Commission’ licensing decisions, courts have warned the

Commission that its comparative renewal process should

not be permitted to degenerate into an irrebutable pre-

sumption of renewal,* and that the Commission “may not

use renewal expectancies of incumbent licensees to shortcir-

cuit the comparative hearing.”

Still, the FCC has disfavored implementation of the full

hearing Ashbacker requirement of Section 309(e) of the Act

to comparative renewal proceedings. The Commission has

gone so far as to recommend to Congress that Section 309 of

the Act be amended to provide for a two-tiered approach to

broadcast licensing renewals.° In the absence of that re-

quested Congressional relief, the Commission has, on its

own, on an ad hoc basis, set itself to repealing the full

>Committee for Community Access v. FCC, 737 F.2d 74 (D.C. Cir.

1984); Central Florida Enterprises, Inc. v. FCC, 598 F.2d 37 (D.C.

Cir. 1978), reh. en bane denied and modified, 598 F.2d 58, cert.

dismissed, 447 U.S.-957 (1979) (“Cowles I”); Citizens Communica-

tions Center v. FCC, 447 F.2d 1201 (D.C. Cir. 1971), clarification

granted, 463 F.2d 822 (1972); Greater Boston Television Corporation

v. FCC, 444 F.2d 841 (D.C. Cir. 1970).

‘Eg., Central Florida Enterprises, Inc. v. FCC, 683 F.2d 503

(D.C. Cir. 1982), cert. den., 103 S.Ct. 1774 (1983) (“Cowles IT”).

Fidelity Television Inc. v. FCC, 515 F.2d 684, 709 (D.C. Cir. 1975)

(Bazelon, C.J.) (voting for rehearing en banc), cert. denied, 423 U.S.

926 (1975).

°Formulation of Policies Relating to the Broadcast Renewal Appli-

cant, Stemming from the Comparative Hearing Process (Notice of

Inquiry), 88 FCC 2d 120, 121 n. 1 (1981).

wna 2 ane de aaa ee

hearing requirement of Section 309(e) of the Act in com-

parative renewals.

The Commission has attempted to accomplish this task

through adoption of a licensing approach which, on its face,

appears eminently reasonable, but, which in practice, is so

heavily weighed in favor of incumbent broadcasters that it

amounts to a fraud on the comparative challenger and on the

listening public. The instant case provides ample documen-

tation that, at the Commission, the “tacit presumption that

the incumbent licensee is to be preferred over competing

applicants” still reigns supreme.

Under Section 309(e) of the Communications Act, the

burden of proof (as well as the burden of proceeding) in a

renewal hearing is on the renewal applicant to demonstrate

that grant of its renewal will serve the public interest.*

Thus, in the instant case, it was BCI which had the statu-

tory obligation to provide affirmative evidence demonstrat-

ing that its programmii g was responsive to those needs

which existed in its community of license.” Genesis had no

obligation to demonstrate unmet needs.

BCI failed to meet its statutory burden. Although BCI

claimed in its written hearing exhibits that it had addressed

the ascertained problems and needs of its community

through its programming, its witnesses could not answer

the simplest questions concerning when and how these

needs and problems were addressed. Jorge Infanto, the

individual offered by BCI to sponsor its programming ex-

‘Cowles I, supra, 598 F.2d at 41.

“See Beebe v. FCC, 61 F.2d 914, 915 (D.C. Ct. App. 1932); Office of

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

1007 (D.C. Cir. 1966).

%See New Mexico Broadcasting Co., Inc., 88 FCC 2d 1469, 1473

1982).

hibits, candidly admitted that he knew virtually nothing

about the programming broadcast by WOJO during the

relevant license term, including to what extent that pro-

gramming was responsive tc community problems. J.A.

142-149, 160-167. Despite repeated requests by Genesis,

BCI failed to offer any other individual who would provide

information as to the station’s non-entertainment program-

ming during the relevant license period. J.A. 144-146,

150-151, 163-164.

Despite BCI’s failure to meet its Section 309(e) burden,

the Commission, nevertheless, credited it with providing

responsive programming and granted it a renewal expec-

tancy.'’ Clearly, the Commission was legally incorrect in its

assessment, as BCI could not properly receive a renewal

expectancy for programming which it could not even show

was responsive to the problems and needs of its community

of license. The Commission in effect, reversed the Section

309(e) burden and, contrary to law, obligated Genesis to

demonstrate why WOJO’s license should not be renewed.

The court of appeals judgment affirming the Commission's

licensing approach permits the Commission to continue its

illegal policy under which renewal is assumed rather than

demonstrated on the record, contrary to the explicit terms

of the FCC's authorizing statute.

2. The Decision Below Failed To Follow Those Judicially

Approved Standards For Determining Licensee Perfor-

mance And Instead Created An Irrebutable Presumption

In Favor Of Renewal

Because the issuance of a broadcast license does not

confer any proprietary interest in that license, a license

“Broadcast Communications, Inc., 93 FCC 2d 1162, 1164-65 (Rev.

Bd. 1983) App. C at 6a-8a.

annie ee

Oo aeclen paiely

entails no right of renewal." The public interest standard of

the Communications Act does, however, recognize a

“renewal expectancy,” which, under limited circumstances,

permits the Commission to attach some weight to the fact of

incumbency when considering an application for renewal in

a comparative hearing.

A “renewal expectancy” may not be based upon the fact of

incumbency per se. To the contrary, the awarding of an

expectancy, as well as its strength, depends on the merit of

the renewal applicant’s past broadcast record. According to

the Commission, an incumbent broadcaster may expect to

receive a legitimate renewal expectancy only when, at the

very least, its performance has been “substantial”. Substan-

tial performance has been defined as being “sound, favora-

ble and substantially above a level of mediocre service which

might just minimally warrant renewal.”'* When an incum-

bent has rendered substantial, but not superior service, the

“expectancy” takes the form of a comparative preference

weighed against other comparative factors. However, an

incumbent rendering minimal service receives no prefer-

ence at all.’* Minimal performance consists of performance

of all statutory obligations and minimal, although adequate

attention to the issues confronting the licensee’s community,

"47 U.S.C. §§ 301, 304.

"Cowles Florida Broadcasting, Inc., 62 FCC 2d 953, 955-956

(1977), vacated and remanded sub nom. Central Florida Enter-

prises, Inc. v. FCC, 598 F.2d 37 (D.C. Cir. 1978), reh. en banc denied

and modified, 598 F.2d 58, cert. dismissed, 441 U.S. 957 (1979).

’Cowles Broadcasting, Inc., 86 FCC 2d 933, 1012 (1981), aff'd sub

nom. Central Florida Enterprises, Inc. v. FCC, 683 F.2d 503 (D.C.

Cir. 1982), cert. denied, 103 S. Ct. 1774 (1983).

10

primarily, and service area outside of its community,

secondarily. “*

In permitting the establishment of a renewal expectancy,

the court of appeals relied upon the Commission’s commit-

ment that such an expectancy would be factored in for the

benefit of the public, not for incumbent broadcasters, and

that where “the denial of a license renewal would not under-

mine renewal expectancy in a way harmful to the public

interest, then renewal expectancy [wJould not be in-

voked.””° It is clear that, in this case, the Commission has

failed to honor its commitment. In view of WOJO’s license

term broadcast performance, described above, it can hardly

be reasonably argued that the refusal to award a renewal

expectancy to WOJO would harm the listening public.

WOJO’s performance was no more than adequate. Under

the Commission’s own standards, such a record should have

resulted in a finding of “minimal,” rather than “substantial”

performance, with no renewal expectancy being awarded to

the incumbent broadcaster.

The Commission’s decision to grant renewal based on the

existence of such an expectancy is one step further in the

emasculation of the Commission’s renewal standards and

the deterioration of the comparative licensing process into

precisely the sort of irreversible presumption in favor of

renewal that earlier courts had warned against. The court of

appeals judgment in this case to defer to the Commission

permits the FCC to continue to redefine downward the level

of broadcast service required for the awarding of a renewal

See Report and Order on Deregulation of Radio, 84 FCC 2d 968,

989 n. 53, recon. den., 87 FCC 2d 797 (1981), affd in part and

remanded in part sub nom. Office of Communication of the United

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

°Cowles II, supra, 683 F.2d at 510.

(ban Wall ADA RNR IIA PARTE IE 9 1B: LALO SIR bts La REMI Py ite RNB i ee

Ae ile abs ie Shei

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11

expectancy. The consequences of that judgment will not be

felt by Genesis alone, for it cannot help but lead to the

dimunition of broadcast service nationally, as broadcasters

recognize that the “competitive spur” previously provided

through the prospect of competing applicants at renewal

time has been effectively removed.

Pursuant to the terms of Section 402(b) of the Communi-

cations Act, the District of Columbia Circuit has exclusive

jurisdiction over appeals from licensing decisions and orders

of the FCC. The fact of that exclusive jurisdiction rules out

the possibility of a conflict of circuits in Commission ad-

judications, a major basis for granting writs of certiorari.

However, in view of the leading role played by the District of

Columbia Circuit in the review of decisions of the FCC, this

case calls for the exercise of supervisory power by this

Court to ensure that the judgment of the court below does

not depart from the norms of judicial review.

CONCLUSION

For the foregoing reasons, the petition for a writ of cer-

tiorari should be granted.

Respectfully submitted,

Robert Bennett. Lubic*

Robert L. Olender

Lee J. Peltzman

Aaron Shainis

BARAFF, KOERNER, OLENDER

& HOCHBERG, P.C.

2033 M Street, N.W.

Suite 203

Washington, D.C. 20036

(202) 452-8200

Counsel for Petitioner

Genesis Broadcasting Limited

*Counsel of Record

September 3, 1985

APPENDICES

la

APPENDIX A

UNITED STATES COURT OF APPEALS

For THE DISTRICT OF COLUMBIA CIRCUIT

SEPTEMBER TERM, 1984

No. 84-1154

GENESIS BROADCASTING LIMITED

. Vv.

FEDERAL COMMUNICATIONS COMMISSION

JUN 4 1984

BEFORE: Robinson, Chief Judge, Wright, Tamm, Wald,

Mikva, Edwards, Ginsburg, Bork, Scalia and Starr, Circuit

Judges, and Davis, Circuit Judge, United States Court of

Appeals for the Federal Circuit

ORDER

Appellant’s suggestion for rehearing en banc, filed May 13,

1985, has been circulated to the full Court and no member has

requested the taking of a vote thereon. Upon consideration of

the foregoing, it is

ORDERED, by the Court en banc, that the suggestion is

denied.

Per Curiam

FOR THE COURT

GEORGE A. FISHER, CLERK

BY: Robert A. Bonner

Chief Deputy Clerk

2a

APPENDIX B

UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

SEPTEMBER TERM, 1984

No. 84-1154

GENESIS BROADCASTING LIMITED,

Appellant

V.

FEDERAL COMMUNICATIONS COMMISSION,

Appellee

BROADCASTING COMMUNICATIONS, INC.,

Intervenor

Filed MAR 29 1985

APPEAL FROM AN ORDER OF THE FEDERAL

COMMUNICATIONS COMMISSION.

Before: WALD, EDWARDS, and DAVIS*, Circuit Judges.

JUDGMENT

This cause came on to be heard on a notice of appeal from an

order of the Federal Communications Commission, and was

argued by counsel. While the issues presented occasion no

need for an opinion, they have been accorded full consideration

*Of the United States Court of Appeals for the Federal Circuit, sitting by

designation pursuant. to 28 U.S.C. § 291(a).

3a

by the Court. See Local Rule 13(¢c). On consideration of the

foregoing, it is

ORDERED and ADJUDGED, by this Court, that the order

of the Federal Communications Commission on appeal herein is

hereby affirmed. It is

FURTHER ORDERED, sua sponte, that the Clerk shall

withhold issuance of the mandate herein until seven days after

disposition of any timely petition for rehearing. See Local Rule

14, as amended on November 30, 1981 and June 15, 1982. This

instruction to the Clerk is without prejudice to the right of any

party at any time to move for expedited issuance of the man-

date for good cause shown.

Per Curiam

For The Court

: George A. Fisher

Clerk

da

APPENDIX C

Before the

Federal Communications Commission

Washington, D.C. 20554

FCC 84-99

95194

a

In re Applications of

BROADCAST COMMUNICATIONS, INC. BC Docket No. 81-157

Evanston, Illinois File Nos. BRH-85

For Renewal of Main, Auxiliary, and BRSCA-206

Sub-Carrier Authorization

Licenses of Station WOJO (FM)

Evanston, Illinois

GENESIS BROADCASTING LIMITED BC Docket No. 81-158

Evanston, Illinois File No. BPH-10386

For Construction Permit

MEMORANDUM OPINION AND ORDER

Adopted: March 15, 1984 Released: March 20, 1984

By the Commission:

1. The Commission has before it: (a) an Application for

Review of the Review Board's Decision herein' filed May 4,

1983, by Genesis Broadcasting Limited (Genesis); (b) an Ap-

plication for Review of the Review Board's Decision herein filed

May 4, 1983, by Broadcast Communications, Inc. (BCI); (¢) an

Opposition to (a) filed June 17, 1983, by BCI; (d) an Opposition

'93 FCU 2D 1162 (1983).

a oe

ee ene

Da

to (b) filed June 17, 1983, by Genesis; and (e) a Consolidated

Opposition to (a) and (b) filed June 17, 1983, by the Chief, Mass

Media Bureau.

2. We have determined that BCI should not receive a prefer-

ence for its proposed Spanish language programming. The

record evidence demonstrates that there is a substantial

amount of Spanish lang... ze programming in Station WOJO's

service area during the day,” but that at night WOJO serves an

area not served by other Spanish language stations.* Although

Evanston, Illinois has two daytime-only AM stations and one

non-commercial educational F'M station, Station WOJO is the

only fulltime commercial station licensed to Evanston and thus

provides the only local (Evanston) commercial radio service at

night. There is an obvious need for both the specialized pro-

gramming proposed by BCI and the general market program-

ming proposed by Genesis. Therefore, neither applicant is due

a preference for its proposed programming.‘

*See paras. 28 and 29 of the Initial Decision, 98 FCC 2d 1176, 1184-86

(1982).

‘Station WOJO would provide the only Spanish language radio service at

night to an area of 833 square miles in which 116,000 Hispanics live. See BCI

Exhibit 17, pp. 5-7. Evanston, which is BCI's city of license, has a population

of 80,113, of which 1,715 persons are Hispanic.

‘Uur action herein is consistent with our award of a substantial preference

to American International Development, Inc. (AID) for its proposed Spanish

language programming in American International Development, Inc.

(AID), 75 FCC 2d 67, 96, 107 (ALJ 1979), affirmed, 86 FCC 2d 808, 818

(1981). AID was an applicant for a new FM station to be licensed to Phoenix,

Arizona, which was already being served by several stations with general

market formats. In AJD we found that a significant Hispanic population

resided both in Phoenix and within the rest of AID's proposed 1 mV’m

contour and that there was a dearth of Spanish language programming in the

Phoenix area. In the case now before us, BCI's community of license is

Evanston, Illinois, which has about 1,700 Hispanics out of a total population

of about 80,000. Thus, there is only a small Hispanic population in Evanston.

Further, Station WONX, a daytime-only commercial radio station licensed to

Evanston, is a Spanish language station. Lastly, we note that WOJO is the

only fulltime broadcast station assigned to Evanston.

6a

3. Except for our determination that BCI should not receive

a preference for its specialized programming, we concur in all

significant respects with the Review Board’s decision herein.

Thus, we agree that BCI’s past broadcast record was substan-

tial as defined by Cowles Broadcasting, Inc.,*° and therefore

deserves a significant comparative preference or what is

termed a “renewal expectancy,” which outweighs Genesis inte-

gration and diversification preferences. We also concur with

the Board’s assessment of a moderate demerit against Genesis

for exhibiting carelessness in filing and prosecuting its applica-

tion through the hearing process.® Therefore, BCI is the clear

winner in this proceeding.

4. However, Genesis has raised arguments concerning BCI’s

past broadcast record which warrant further comment. Gene-

sis claims that BCI has provided truly minimal service to the

residents of Evanston, Illinois. Several individuals, including

two Evanston aldermen, stated that Station WOJO was not

responsive to Evanston’s needs and interests because too much

of its programming was in Spanish and directed to audiences

residing mostly outside of Evanston. Without making any spe-

cific reference to Station WOJO, a third alderman expressed his

interest in having a station in Evanston which would broadcast

a significant amount of English language programming, while a

fourth alderman stated that Evanston needed more locally-

oriented programs. None of the aldermen’s statements ex-

plained whether their comments related to the license term

being examined in this proceeding (7.e., 1973-1976) or the

586 FCC 2d 933, 1006 (1981), affirmed sub nom., Central Florida Enter-

prises, Inc. v. FCC, 683 F.2d 503 (D.C. Cir. 1982).

*In its Application for Review, BCI argues that the Review Board erred

when it failed to overrule the Presiding Judge's refusal to add a basic dis-

qualifying issue against Genesis for neglecting to report the filing of a

criminal complaint against Mr. Renken, who is Genesis’ President, as re-

quired by Section 1.65 of our Rules. This argument is now moot. The hearings

have been completed and BCI has proven itself to be the winner based on the

existing record. There is no reason to conduct further hearings to determine

whether Genesis should have lost by a wider margin than the present record

indicates.

Ta

degree to which they were familiar with Station WOJO’s pro-

gramming.’ Further, none of the foregoing witnesses identified

any local public issues which might have been omitted by the

licensee. Other testimony praised WOJO for its public service

to Hispanics in Evanston and the Chicago metropolitan area.

The subjective preferences of various witnesses, both pro and

con, do not provide a basis for altering the conclusion that BCI’s

past broadcast record was substantial and thus merits a signifi-

cant comparative preference in this proceeding. In this re-

spect, paragraph 4 of the Review Board’s Decision summarizes

the portion of the evidentiary record which provides a basis for

an objective analysis of the licensee’s broadcast record.

5. Further, Genesis argues that BCI fell short of broadcast-

ing the amount of news and public affairs programs it stated it

would broadcast during the relevant license term of 1973 to

1976. In its 1973 renewal application, BCI proposed to provide

21.49 percent of its overall programming in the following non-

entertainment categories: news, 5 percent; public affairs, 1.49

percent, and all “other” programs (exclusive of entertainment

and sports), 15.0 percent. In its 1976 renewal application, BCI

initially computed the following percentages of its program-

ming as constituting nonentertainment programs presented

during the composite week: news 4.1 percent; public affairs,

0.3 percent, and all “other” programs, 14.0 percent, for a total

of 18.4 percent. BCI recomputed those percentages most re-

cently in October 1981, explaining that it had misread some of

the programming logs in previous computations. These most

recent figures are: news, 5.3 percent; public affairs, 0.3 per-

cent; and “other” programs, 15.3 percent for a total of 20.9

percent nonentertainment programming.* Although Genesis

appears to be relying upon the initial 1976 computations, it has

not demonstrated that the most recent figures are not reliable.

Like the Review Board, we accept the most recent computa-

tions as accurate. Thus, BCI did not broadcast the amount of

7One alderman stated that he was not familiar with WOJO’s programming.

*See paras. 32-35 of the Initial Decision, 93 FCC 2d 1176, 1186-87.

8a

public affairs it proposed, but exceeded the amount of news and

“other” programming it had initially planned to air. Further,

BCI has given an adequate explanation as to why it broadcast

so few public affairs programs, namely, that certain entities

which produced those programs discontinued producing

them.’

6. We find that there is no significant discrepancy between

BCI’s proposed (21.49 percent) and performed nonentertain-

ment programming, whether one relies on the original (18.4

percent) or the most recent (20.9 percent) computations for

BCI’s composite week. Further, whether one utiliz~s the orig-

inal or the most recent computations for BCI’s composite week,

BCI exceeded the average and median percentages of nonen-

tertainment programming broadcast during the composite

week by the other commercial FM stations serving the Chicago

area.'° Just as we compared similarly situated television licen-

sees in Cowles Broadcasting, Inc.,"' we find it more meaningful

in measuring BCI’s performance to compare similarly situated

FM stations than to compare all radio stations in the Chicago

market.”

7. ACCORDINGLY, IT IS ORDERED, That pursuant to

Section 1.115(g) of the Commission’s Rules, the Application for

Review of the Review Board’s Decision herein filed May 4,

1983, by Genesis Broadcasting Limited IS GRANTED to the

extent indicated in this Memorandum Opinion and Order and

IS DENIED in all other respects, the Application for Review

of the Review Board’s Decision herein filed May 4, 1983, by

Broadcast Communications, Inc. IS DENIED, and the Review

Board Decision, FCC 83R-24, released April 4, 1983, IS MOD-

IFIED as reflected herein.

FEDERAL COMMUNICATIONS COMMISSION

William J. Tricarico

keiaaeadaiie Secretary

%See BCI Ex. 23, p. 205.

See the chart in paragraph 36 of the Initial Decision, supra.

"86 FCC 2d 993, 1006-07 (1981).

See para. 36, note 10 of the Initial Decision, supra.

9a

Appendix D

Before the

Federal Communications Commission

Washington, D.C. 20554

FCC 83R-24

3262

In re Applications of

BROADCAST COMMUNICATIONS,

INC.

Evanston, Illinois

For Renewal of Main Auxiliary

and

Sub-Carrier Authorization

Licenses of Station WOJO (FM),

Evanston, Illinois

GENESIS BROADCASTING

LIMITED

Evanston, Illinois

For Construction Permit

BC Docket No. 81-157

File Nos. BRH-85

BRSCA-206

BC Docket No. 81-158

File No. BPH-10386

APPEARANCES

Brian M. Madden and Stanley B. Cohen for Broadcast

Communications, Inc.; Aaron Shainis and Robert L. Olender

for Genesis Broadcasting Limited; and Norman Goldstein and

Charles W. Kelley for the Chief, Mass Media Bureau, Federal

Communications Commission.

DECISION

Adopted: March 25, 1983 Released: April 4, 1983.

Board Chairman Marino for the Review Board:

10a

1. This comparative renewal case began when Broadcast

Communications, Inc., licensee of Station WOJO(F'M) in Evan-

ston, Illinois sougi senewal after its 1973 to 1976 license term.

A competing application for Station WOJO’s FM channel was

filed by Genesis Broadcasting Limited leading to a trial type

comparative hearing in 1981. In his Initial Decision, FCC

82D-61, released August 26, 1982, Administrative Law Judge

Kuhlmann selected Station WOJO(FM) as the best com-

parative applicant. Genesis was awarded a slight to moderate

preference for participation of ownership in management,

which was overcome by (1) a moderate demerit assessed

against Genesis for carlessness in prosecuting its application,

(2) Station WOJO’s substantial preference for proposing spe-

cialized programming utilizing a Spanish language format, and

(3) a very slight renewal expectancy preference for WOJO’s

past performance. I.D., at para. 69. Our review of the Initial

Decision is guided by the standards set out by the Commission

in Cowles Broadcasting, Inc., 86 FCC 2d 993 (1981), which was

affirmed by the Court in Central Fiorida Enterprises, Inc. v.

FCC, 683 F.2d 508, 51 RR 2d 1405 (D.C. Cir. 1982). See also

Radio Station WABZ, Inc., 90 DCC 2d 818 (1982); Simon

Geller, 90 DCC 2d 250 (1982). After considering the record in

the light of the briefs and exceptions filed October 22, and

November 15, 1982, and the oral argument held January 6,

1983, the Review Board has concluded that the ALJ’s findings

of fact are substantially complete and accurate. Therefore,

except as modified or amplified in this Decision, those findings

are adopted. We affirm the ALJ’s renewal of Station

WOJO(FM)’s license but our reasoning differs somewhat, es-

pecially with respect to the station’s past performance which

we find to be substantial for the reasons set out below, paras.

4-14. Other major points which have been briefed/and which

are discussed below concern WOJO’s proposed specialized pro-

gramming, paras. 15-18; diversification of mass media, paras.

19-20; participation of ownership in management, paras. 21-23;

and Genesis’ demerit for carelessness, paras. 24-25.

2. Background. Station WOJO(FM), which began indepen-

dent operation on February 1, 1947, has carried foreign lan-

lla

guage and other specialized programs, often on a brokered

basis, since 1956. BCI exh. 2, p. 5. From 1953 through 1981, the

licensee of Station WOJO(FM) was also the licensee of an AM

Station in Evanston. Jd. English language news and public

service offerings were broadcast on both the AM and FM

stations although little, if any, of the broadcasting was dupli-

cated. In the early 1970's, Station WOJO(F'M) was authorized

to provide a city grade signal, the highest quality of service,

over all of the Chicago city limits, in addition to Evanston. In

1971 it was granted authority to employ a dual city identifica-

tion as Evanston-Chicago. /d., at P. 6. At the beginning of the

1973-1976 license term in question, the proportion of foreign

language programming on Station WOJO(F'M) had increased

to 53% of all of its programming, predominately composed of

Spanish language presentations. Jd. While Station

WOJO(FM)’s application for renewal was pending, Edward

Wheeler, one of the founders of the station and the individual

responsible for the station’s daily operation through the

1973-1976 license term, died on November 25, 1977. After his

death, control of the corporation reverted to the other stock-

holders in proportion to their ownership interests. These prin-

cipals substantially increased the time devoted to Spanish pro-

gramming so that by 1979 all foreign language programming,

more than 23 hours per day, was in Spanish. /d., at p. 7. By

February 1980, all brokerage arrangements were terminated.

Id.

3. Subsequent to the filing of the applications in this proceed-

ing, the Commission altered its regulatory policies toward AM

and FM radio. See, Report and Order on Deregulation of

Radio, 84 FCC 2d 968 (1981), recon. denied 87 FCC 2d 797

(1981), review pending sub nom. Office of Communications of

the United Church of Christ v. FCC, Case No. 81-1032 (D.C.

Cir. filed January 14, 1981). These new policies are applicable to

all new facilities applications and to those portions of renewal

applications which relate to future proposals. 84 FCC 2d at

1012-13. However, Station WOJO’s past performance record

12a

will be evaluated in accordance with pre-radio deregulation

policies. See Simon Geller, supra, 90 FCC 2d at 252.

4. Past Programming: During the 1973-1976 license period,

Station WOJO(F'M) presented 5.3% news, 0.3% public affairs,

and 15.3% all other non-entertainment programming. I.D.,

para. 34, These percentages do not include additional news,

public affairs and informational matters which were broadcast

by the station on its brokered non-English programming but

not logged separately I.D. para. 39. In this regard, Enrique S.

Lopez, who provided two hours of brokered Spanish program-

ming daily (Tr. 643) and was typical of the Spanish language

brokers (Tr. 644-45), testified that 60% of his programming was

entertainment and 40% was news, information, and public

service announcements. Tr. 650. The ABC Entertainment

Network News provided Station WOJO(F'M) 5 minutes news

per hour on the half hour except during those hours when the

foreign language news was regularly broadcast. I.D. para. 39.

Community problems, needs and interests considered by the

licensee to be most significant were dealt with on “Shape of

Today,” a thirty-minute program aired Sunday mornings from

8:30 to 9:00, feat: ring interviews with local community leaders

and on a number of !ocal religious services broadcast on Station

WOJO(F'M). See 1. D., para. 37; BCI Exh. 23, pp. 9-10. Various

foreign language programs that were part of its brokered for-

mat also contained information that helped meet the needs of

the group being served. I.D., para. 38. Finally, during the

composite week of December 7-13, 1975, Station WOJO(FM)

broadcast 576 public service announcements responsive to

community problems. BCI Exh. 23, p. 10; I.D., at para. 33.

5. Since 1961, Station WOJO(F'M) has been continually as-

sisted in providing programming responsive to the needs of the

community by an Advisory Board which meets annually. I.D.,

at para 40. The Board is composed of community leaders in

Evanston and its environs including the mayor, city manager,

police chief, librarian, and superintendent of schools of Evan-

ston as well as professors from Northwestern University, lo-

13a

cated in Evanston, and leaders of the religious, publishing, and

business communities. BCI Exh. 23, pp. 25, 100, 140, 172.

6. In his Initial Decision the ALJ concluded that WOJO(F'M)

fell short of the amount of news and public affairs programming

indicated in its 1973 renewal application where it proposed 5%

news, 1.49% public affairs, and 15% all other non-entertain-

ment programmin. I.D. at para. 41. In fact, WOJO only fell

below its 1973 proposal for public affairs programming and

exceeded its promises concerning news and all other non-

entertainment programming. Prior to the hearings, WOJO

responded to a Commission staff inquiry that it had broadcast

certain public affairs programs at the beginning of the license

term but was forced to discontinue the programs after the local

groups providing such programs quit producing them for vari-

ous reasons. BCI Exh. 23, p. 205. It noted, however, that since

it first began operations, it had broadcast public affairs pro-

grams substantially exceeding Commission guidelines. Jd. It

also pointed out that certain of its foreign language program-

ming such as “Hellenic Interlude,” a Greek program, had re-

ceived community awards for public service in a dinner at-

tended by leaders honoring the fifteenth anniversary of the

airing of the program. /d., at p. 206. The stipulated testimony

of six Evanston residents who did not speak or understand

Spanish was submitted along with the testimony of a former

station employee that was critical of the station’s past perfor-

mance. I.D. at paras. 42, 43. Station WOJO(FM) was awarded

avery slight renewal perference by the ALJ because it did little

to initiate news or public affairs programming, relying instead

on station programming provided by the station brokers, I.D..,

at paras. 68, 69.

7. Station WOJO contends that it is entitled to a stronger

preference for its past performance during the 1973-1976 li-

cense term than was awarded by the ALJ. (Br. p. 36) It also

argues that the ALJ erred in not allowing it to place into

evidence the past performance of Station WOJO(FM) under

the direction of its present principals who took over the man-

agement of the station on the death of Edward Wheeler subse-

l4a

quent to the 1973-1976 license term. Genesis, on the other

hand, contends in its exceptions that BCI is not entitled to any

perference as a renewal applicant.

8. We agree that the broadcast record for Station WOJO(F'M)

during the 1973-1976 license term was substantial and thus we

need not reach the question whether the ALJ erred in refusing

to allow WOJO’s post 1973-1976 record into evidence. As noted

in Cowles, supra, and Radio Station WABZ, Inc., 90 FCC 2d

818, 51 RR 2d 1507(1982) a substantial record, sound, favorable

and substantially above a level of mediocre service which might

just minimally warrant renewal, gives rise to a renewal expec-

tancy which in turn warrants a preference in comparative

renewal proceedings. 90 FCC 2d at 839-40, 51 RR 2d at 1525. A

substantial performance can be demonstrated by any type of

showing reasonably related to demonstrating service over and

above what would be considered minimal. Here, we believe

such a showing was made. Quantitatively, as reflected by its

composite week, Station WOJO(FM) devoted nearly 21% of its

broadcast time to non-entertainment programming, which

compares favorably with the amount of like time broadcast by

the renewal applicant in Radio Station WABZ, Inc., supra,

where the Commission characterized the licensee’s record as

superior. 90 FCC 2d at 839-40, 51 RR 2d at 1525. And this total

omits the non-entertainment programming included in its non-

English programming which would in reality substantially in-

crease the amount of broadcast time Station WOJO(F'M) de-

voted to non-entertainnent programming. This record can be

contrasted with Simon Geller, 90 FCC 2d 250, 51 RR 2d 1019

(1982), where the licensee devoted less than 1% of its broadcas*

time to non-entertainment programming and no renewal ex-

pectancy was awarded. 90 FCC 2d at 264-265, 271, 51 RR 2d

1032, 1038. Moreover, although much of the non-entertainment

programming on the brokered programs is not included in the

statistics above, the amount still exceeds the average and

median percentages of the other commercial FM stations serv-

ing the Chicago area. I.D. aat para. 36. News and public affairs

programs were broadcast in both English and Spanish. BCI

15a

Exh. 23, p. 19; Tr. 650. In addition to the half hour program

“Shape of Today,” produced locally, Station WOJO(FM) broad-

cast live a number of local religious services. BCI Exh. 23, pp.

9-10. Moreover, Station WOJO(F'M) broadcast a substantial

number of public service announcements. I.D. at para 33.

9. The principal ingredient of a licensee’s obligation to oper-

ate his station in the public interest is the diligent, positive, and

continuing effort to discover and fulfill the tastes, needs, and

desires of its service area for broadcast service. See WPIX,

Inc., 68 FCC 2d 381, 400, 43 RR 2d 278, 303 (1978), paraphras-

ing from the Programming Policy Statement, 44 FCC 2303,

2316 (1960). Here, the record evidence reflects that WOJO has

diligently and continuously taken steps to ensure that it is

responsive to its service area’s needs and tastes. Thus, since

1961, it has met annually with a Community Advisory Board

composed of all types of community leaders concerning Station

WOJO(F M)’s programming. BCI Exh. 23, pp. 97, 137, 168, 200.

The 1973 annual report to the Advisory Board revealed that

Station WOJO(FM) was helping the administration and stu-

dents of Loyola Academy apply for and operate a 10 watt

educational FM station at the Academy, .. aking substantial

donations of funds and equipment for this small educational

station which had no access to public funds (?d., at p. 31); it had

successfully solicited funds necessary to bring a small Greek

child from Greece to Chicago for needed medical attention to

permanently correct a heart defect (id., at p. 32); and it had

attempted unsuccessfully with the cooperation of Station

WBBM-TV(CBS) to present a Spanish audio to go along with

the video of the television station’s evening news (id., at p. 33).

The experiment with Station WBBM-TV was discontinued

after 3 1/2 months because it was too cumbersome and resulted

in a slight decrease in the amount of news aired by Station

WOJO(F'M). Jd., at pp. 13, 33. Moreover, the report indicated

that Station WOJO(F'M) and its sister AM station were the only

outlets carrying Big Ten Conference (7.e., Northwestern) foot-

ball and basketball games in the Chicago area, which has the

heaviest concentration of Big Ten alumni (7d., at pp. 35, 146).

l6a

Station WOJO(FM) continued to carry the broadcasts because

of the public interest in the games, notwithstanding that the

expense of keeping them on the air exceeded the revenues they

brought in (?d., at p. 146).

10. During the Community Advisory Board meeting for the

year 1973, Board Member Dayton Grafman, vice-president at

the National College of Education, praised Station WOJO(FM)

for recognizing that there were a large number of Spanish

speaking people in the Chicago area who needed radio facili-

ties. Jd., at p. 97. And one of the station employees announced

that Station WOJO(F'M) had been given the top rating in FM

Spanish broadcasting by eleven judges of the annual “Spanish-

- American Radio and TV Festival.” Jd. One of the other Board

Members, James C. McLeod, professor emeritus, History and

Literature of Religions Northwestern University, praised the

station highly for its participation in community affairs. /d.,

And Board Member Randolph R. Tomlinson, Editor and Pub-

lisher, The North Shore Examiner, Evanston’s only Black

newspaper (id., at p. 205), stated that he was fimiliar with

Spanish and that he listened to the Spanish programming on

Station WOJO(F'M) and found the quality to be excellent. /d.,

at p. 97.

11. During the 1974 meeting, Board Member Ruben Cruz,

columnist, Chicago Sun-Times, stated that the Spanish lan-

guage programming aired on Station WOJO(FM) was of high

quality and it served a necessary purpose. /d., at p. 137. It was

expressed at that time that Station WOJO(F'M) appeared to be

the principal Spanish-language outlet serving the Chicago

metropolitan area and that such programming would therefore

probably be increased. Jd. The 1976 report to the Community

Advisory Board revealed that Station WOJO(FM) once again

carried the high school football and basketball tournaments

and aired a presentation of the Award of Merit Trophy by

Sports Illustrated magazine to a local high school athlete. /d.,

at p. 180. Moreover, Station WOJO(FM) broadcast the Accion

Rapida column of the Chicago Tribune as a public service to the

Spanish-speaking. population and supplied broadcast equip-

17a

ment to students of a local high school to use in preparing a

weekly public affairs program. WOJO(FM) Id., at p. 181.

12. Once the Advisory Board was aware that a competing

application could be filed against Station WOJO(FM) at re-

newal time, the Board, without solicitation, demonstrated its

support for the station by unanimously passing a motion to

prepare a resolution supporting the continuation of the man-

agement of Station WOJO(F'M). /d., at pp. 200-201. In our view,

the above facts reflect a pronounced and abiding public spirited

commitment on the part of Station WOJO(FM) to its service

area.

13. In awarding only a slight renewal preference for Station

WOJO(F'M) past performance, the ALJ was apparently pri-

marily concerned that the station’s broadcast day was limited

for initiating its own news and public affairs programming

because of the significant amount of broadcast time purchased

by brokers who then determined the station’s programming.

Genesis also disparages Station WOJO(FM)’s past perfor-

mance on the basis that much of its programming was

“brokered” and that its total percentage of public affairs pro-

gramining was low relative to the other stations in the market.

We disagree with both of these assessments. An analysis of a

licensee's relative responses to the important needs and tastes

of its service area should focus on the licensee's overall program

service rather than on isolated aspects of programming such as

the source of certain programs or the program format used to

treat such needs and tastes. See WPLX, Inc., supra at 400, 43

RR 2d at 304. The record as reflected by the evidence con-

cerning the Community Advisory Board meetings establishes

that the community leaders believed the non-English program-

ming to be meritorious. Also the record reveals that Station

WOJO(F'M) exercised adequate controls on the brokers. Bu-

reau Reply Br. 8-10. Thus, it required participating programs

to include public service announcements and newscasts (BCI

Exh. 23, at pp. 39-40) and limited the amount of advertising

that could be broadcast. /d., Tr. 651. We also recognize that the

Commission encourages time brokerage since such a source of

18a

programming has the potential to notably increase available

program alternatives for audience segments whose demands

would otherwise be left unmet. See Policy Statement on Part-

Time Programming, 82 FCC 2d 107, 108, 48 RR 2d 763, 764

(1980). This is particularly true for foreign language audiences

whose preferred programming is unlikely to attract a sizable

cross-over audience. /d., at p. 120, 48 RR 2d at 772. The

Commission has emphasized that licensees should not be dis-

couraged from exploring programming alternatives that ap-

pear to reflect accurately both consumer wants and competi-

tive incentives. /d.

14. With respect to the limited amount of public affairs

programming reflected by the composite week performance, it

appears that a number of locally produced public affairs pro-

grams were aired at the beginning of the license term but were

discontinued for reasons beyond the control of the licensee.

BCI Exh. 28, p. 205. Had these existing programs continued to

be broadcast, Station WOJO(F'M) would have met or exceeded

its public affairs proposals contained in its 1973 renewal ap-

plication. In any event, statistics for the composite week are

not the only means of determining a licensee's performance (see

WPIX, Inc., supra at 401, 43 RR 2d at 305). Station

WOJO(FM) has made pronounced and abiding efforts to be

responsive to its service area as shown by its formation of one of

the first Community Advisory Boards in the country. Thus, we

need not rule on Genesis’ exception that the ALJ improperly

excluded the AM stations from his computations in comparing

BCI’s news and public affairs programming. Finally, with re-

spect to the stipulated testimony concerning Station

WOJO(F'M)’s community reputation, we simply note that while

there were very few individuals who understandably were

critical of the foreign language programming since tiiey did not

speak or understand Spanish, there were other Spanish-speak-

ing individuals who praised the station for providing informa-

tion in Spanish relating to special needs of the Hispanic com-

munity. See Stipulated Testimony. Moreover, although one of

the station’s former employees was critical of its past perfor-

19a

mance, even he acknowleged that the amount of news broad-

cast over Station WOJO(F'M) was about average with that of

other area stations. Tr. 638. On balance, we conclude that

Station WOJO’s past performance demonstrates a positive and

dedicated commitment to serving its service area, which we

characterize as sound, favorable, and substantial. Station

WOJO(FM) is therefore entitled to a strong preference for its

past programming. See Cowles Broadcasting, Inc., 86 FCC 2d

993, 1017, 49 RR 2d 113, 1160, affirmed sub nom. Central

Florida Enterprise, Inc. v. F.C.C., supra; WPIX, Inc., supra

at 406, 43 RR 2d at 310.

15. Specialized Programming Issue. Because Station WOJO

(FM) proposes a specialized format of programming for His-

panics in its service area while Genesis proposes general mar-

ket programming of jazz and rock music, the issues in this

proceeding were enlarged to consider the relative need for

these different types of programming throughout Station

WOJO(F'M)’s service area. Memorandum Opinion and Order,

FCC 81M-2120, released July 15, 1981. WOJO proposes to

broadcast and currently broadcasts, in Spanish twenty-three

and one-half hours out of its twenty-four hour day. The findings

of the Initial Decision, which are undisputed, reveal that more

than 560,000 Hispanics live within Station WOJO (FM)’s serv-

ice contour, 1,715 of whom reside in Evanston. I.D., at para 29.

Twenty-seven percent speak only Spanish and another fifty-

three percent speak primarily Spanish. /d., at para. 27. There

are fifty-five commercial radio stations which place a signal

over Station WOJO(F'M)’s service area, fifteen of which provide

some amounts of Spnish language programming. /d., at para

28. None of the stations, however, provides coverage compara-

ble to that of Station WOJO(FM) either in terms of the total

amount of broadcast hours or the size of the service area. Jd., at

para. 29. While varying amounts of Spanish language program-

ming are available during the day, the ALJ’s findings show that

during nighttime hours, Station WOJO(FM) provides the only

Spanish radio service to an area of 833 square miles in which

116,000 Hispanics live. Jd., at para. 30. Station WOJO(FM)

20a

also provides a second nighttime Spanish voice for 753 square

miles containing another 370,000 Hispanics. Jd. Genesis will

not broadcast any Spanish programming. /d., at para. 31. A

substantial preference was awarded by the ALJ for Station

WOJO(FM)’s format, premised on its demonstration that a

substantial percentage of the Hispanic population receive and

would continue to receive their only Spanish service at night

and that many others would receive their second nighttime

service in Spanish from WOJO. Jd., at para. 64.

16. Genesis argues that WOJO is not entitled to any prefer-

ence for its proposed programming. (Br. 28). It points to the

large number of stations in the market which provide Spanish

language programming, and urges that there is no special need

for more of such programs. It also argues that there is an

absence of any need for Hispanic Programming in Evanston

since only 1,715 Hispanics out of a total population of 80,113

people live there. Finally, it argues that a comparison of pro-

posed programming is repugnant to the public interest, citing

F.C.C. v. WNCN Listeners Guild, 450 U.S. 582 (1981) for the

proposition that a programming preference here is of dubious

legality.

17. We conclude that the ALJ was correct in awarding a

substantial preference under this issue. The purpose of a spe-

cialized programming inquiry is to ensure that a proposal

which responds to truly unmet needs will be considered in our

licensing procedures. See George E. Cameron, Jr. Communi-

cations, 71 FCC 2d 460, 465-466, 45 RR 2d 689, 694 (1979).

Where the proposed programming is available in reasonable

amounts, a preference will not be given. See Flint Family

Radio, Inc., 69 FCC 2d 38, 42-43 (Rev. Bd. 1977) cited with

approval in George E. Cameron Jr. Communications, supra.

Here, there is definitely a need within the service area for

Station WOJO(FM)’s proposed format since denial of its ap-

plication would leave approximately 116,000 Hispanics without

any nighttime Spanish language programming and another

370,000 with only one nighttime voice. This would be a signifi-

cant loss since twenty-seven percent of Hispanics in the Chi-

2la

cago metropolitan area speak only Spanish. Moreover, there is

some indication in the record that a substantial percentage of

Hispanics did not grow up in the Continental United States and

thus have greater informational needs than do the English-

speaking population at large, particularly since many of the

Hispanics are frequently handicapped by low educational lev-

els. Tr. 522. See American International Development, Inc.,

75 ECC 2d 67, 96, 107 (ALJ 1979), affirmed 86 FCC 2d 808, 818

(1981), where an applicant received a substantial preference for

its proposal to provide the only nighttime Spanish language

programming.

18. Genesis’ exceptions do not undermine the ALJ's reasons

for awarding a substantial preference under this issue. The fact

that there are many stations providing daytime Spanish lan-

guage programming is not relevant here since the preference

was awarded for providing a much needed nighttime service.

Nor are we persuaded that the relatively low number of His-

panics residing in Evanston should be dispositive in disallowing

a preference, as urged by Genesis. Denial of credit on this basis

would in effect negate the credit due Station WOJO(FM) for

providing the only nighttime Spanish voice to 116,000 individu-

aJs as well as deny Hispanics in Evanston a station which

served their needs and tastes. We do not believe that such a

result would be consistent with the public interest, particularly

since there are more than fifty other stations providing a signal

over Station WOJO(F'M)’s service area. Moreover, the record

contains evidence that the Hispanic community in Evanston

needs Station WOJO(FM) to provide information in Spanish

relating to its special needs. See Stipulated Testimony of Yolan-

da Salgado, a member of the Board of Associacion Latino de

Evanston. In any event, the Commission’s new regulatory

thrust is to permit licensees in markets where there are a large

number of stations to be more specialized in their program

offerings. See Deregulation of Radio, supra at 988-989; see also

F.C.C. v. WNCN Listeners Guild, supra. Genesis’ reliance on

WNCN is misplaced since the applicant in this case has se-

lected its own specialized format and made the type of showing

22a

entitling WOJO to a substantial comparative preference for its

Spanish language programming.

19. Diversification of Control of the Media of Mass Com-

munications. Genesis and WOJO’s principals no longer own

any other media interests. Subsequent to designation and two

months prior to the hearing, the owners of Station WOJO(F'M)

sold their AM station in Evanston. The ALJ declined to at-

tribute the AM station to WOJO’s owners for diversification

purposes, noting that Genesis was fully aware of the change

before the hearing. Both applicants were found by the ALJ to

be equal under the diversification criterion. Genesis excepts to

the Initial Decision’s failure to take common ownership of

WOJO(FM) and the AM station into account under this

criterion.

20. We agree with Genesis that the AM station was at-

tributable to WOJO for comparative diversification purposes.

A party to a comparative hearing is not allowed to improve its

comparative position after a fixed date beyond which it is no

longer permitted to amend as of right. See WHW Enterprises,

Inc., 89 FCC 2d 799, 813, 51 RR 2d 409, 419 (Rev. Bd. 1982).

After that point, competing proposals are generally considered

to be fixed to ensure that the hearing proceeds in an orderly

and timely fashion. Jd. Here, there was no unequivocal com-

mitment to divest prior to the fixed date. Thus, recognition of

the divestiture of the AM station would be unfair to Genesis

which prepared its case premised on the comparative position

of the applicants prior to designation for hearing. See Muncie

Broadcasting Corp., 89 FCC 2d 123, 130, 51RR 2d 46, 52 (Rev.

Bd. 1982). Genesis is therefore entitled to a substantial prefer-

ence under the diversification criterion. See Nuance Corp., 85

FCC 2d 412, 420, 49 RR 2d 147, 154 (Rev. Bd. 1981). Consistent

with the approach set forth in Cowles Broadcasting, Inc.,

supra, the weight to be accorded to Genesis’ diversification

preference will be determined in the overall comparative eval-

uation of the applicants.

23a

21. Participation of Ownership in Management. Genesis is

made up of two stockholders. Both propose to work full time at

the station in managerial positions. I.D., paras. 9, 12. Both live

or have lived in Evanston and have some broadcast experience.

Id., at paras. 10-12. Neither has been active in Evanston

community activities. Jd., at paras. 52-53. Genesis’ 20% stock-

holder is a minority female. Jd., at para. 12. Station WOJO has

four stockholders; three of whom, owning voting power over

96.5% of the stock, propose to work at the station in managerial

positions. Jane D. Hall, a 55.6% stockholder and a resident of

an adjacent community to Evanston, will work full time; her

husband, a 4.5% shareholder, will work approximately 30

hours per week; and Letitia Wheeler, the executrix of the

estate of Edward A. Wheeier, who votes 35.4% of the shares,

proposes to spend 35 hours per week at the station. Jd., at

paras. 5-8. Mrs. Wheeler is a non-resident of Evanston. /d., at

para. 8. All three currently work at the station in managerial

positions and both Mrs. Hall and Mrs. Wheeler are active in

Evanston community affairs. Jd., at paras. 49, 51. Genesis was

awarded more quantitative full-time integration credit by the

ALJ who remarked that this was somewhat offset by the facts

that 91% of WOJO’s stock is voted by women, that Genesis’

stockholders have no managerial broadcast experience, and

that Genesis 80% stockholder, Henry C. Renken, has been

fired several times from broadcast stations. Genesis was there-

fore awarded only a slight-to-moderate preference for its par-

ticipation proposal.

22. Genesis argues in its exceptions that it is entitled to a

substantial preference, based primarily on the quantitative

full-time proposals of both applicants: 100% v. 55.6%. It ar-

gues, too, that Mrs. Wheeler is entitled to only 17.7% part-

time integration credit since under her husband’s will half of

the stock she votes will go to her children. Finally, Genesis

claims that it was error to consider the absence of managerial

experience and Mr. Renken’s broadcas. employment history as

detractions from its integration proposal. On the other hand,

24a

WOJO claims that neither applic. _.t is entitled to 2 preference

under this criterion.

23. We conclude that Genesis is entitled to a moderate prefer-

ence for its integration proposal. In our view, Genesis is en-

titled to 100% full-time integration credit to WOJO’s 55.6% full

time and 22.2% substantial time. See Van Buren Community

Service, 87 FCC 2d 1018, 1021, 50 RR 2d 115, 118 (Rev. Bd.

1981) (proposal to work 30 hours per week considered substan-

tial time). We will not credit Mrs. Wheeler with the full 35.4%

of the stock she now votes since there is no indication in the

record that the terms of Mr. Wheeler's will—under which she

would get only 17.7% of the stock—will not be performed. In

reaching our determination that the preference is a moderate

one, we have taken into account that the amounts of time

proposed by Mrs. Wheeler and Mr. Hall differ very little from

full time and that WOJO’s proposal is more qualitatively en-

hanced because of its principals’ managerial broadcast experi-

ence and Mrs. Hall and Mrs. Wheeler's involvement in Evan-

ston community affairs. Genesis, of course, has the advantages

of its greater quantitative credit, the local residence of its

principals and the minority and female status of its 20% prin-

cipal. We will not fault Mr. Renken for his checkered broadcast

employment history as did the ALJ vsecause of the in-

completeness of the record. Nor do we hold that the absence of

managerial broadcast experience detracts from Genesis’ inte-

gration proposal. See New Continental Broadcasting Co., 88

FCC 2d 830, 848, 50 RR 2d 1117, 1131 (Rev. Bd. 1981). As was

the case with diversification, the weight to be accorded Genesis

for its participation preference will be determined in the overall

comparative evaluation of the applicants.

24. Carelessness and Certification Isswes. Genesis was as-

sessed a moderate demerit under carelessness and certification

issues. The carelessness issue related to Genesis’ errors in

providing accurate information about three matters: the em-

ployment experience of Henry Renken; an EEO plan for the

station which describes the station’s past practices which was

inapplicable here since Genesis had no previous station; and the

25a

views reported for various community leaders in its ascertain-

ment survey. The certification issue involved the use of a pre-

signed certification page in filing an amendment to Genesis’

application. This act was contrary to the representation on the

certification page that the signatory has reviewed the submis-

sion, 7.e., the amendment, before signing the certification

page. There was no evidence of concealment or misrepresenta-

tion and the omissions concerning the EEO plan and precer-

tification matters were not decisionally significant. The ALJ

held that these matters resulted from inattention and care-

lessness. But, the omissions relating to Renken’s employment

history were decisionally significant since they reflected on his

past broadcast employment record, which the ALJ found to be

poor. And Renken deliberately chose not to report all of his job

changes since he felt that such reporting changes would delay

resolution of the proceeding. This behavior was characterized

by the ALJ as exhibiting bad a Genesis excepts to the

imposition of the demerit.

25. After some reflection we affirm the ALJ on these mat-

ters. Omissions may be excused if they are not deliberate or

decisionally significant and there is no intent to mislead or

conceal. See Merrimack Valley Broadcasting, Inc., 52 RR 2d

1210, 1220 (Rev. Bd. 1982). Perhaps both we and the ALJs have

come to tolerate too much sloppiness in the preparation and

prosecution of applications, especially where there is no intent

to deceive. See, e.g.. HLD&M Communications, Inc., FCC

83R-18, released March 17, 1983, para. 8. Here we concur with

the ALJ that the pattern of carelessness, inattentiveness, and

poor judgment displayed by the applicant (who sought credit

for his broadcast experience) is something that should not be

encouraged. See Radio Station WABZ, Inc., supra, at 827.

Such carelessness engenders protracted litigation and unduly

wastes limited hearing resources. As the ALJ pointed out the

record evidence is clear that the omissions concerning Ren-

ken’s employment history were deliberate and not inadvertent.

Moreover, the information was of potential decisional signifi-

cance since the parties argued at hearing over Renken’ al-

26a

legedly poor broadcast record. We agree with the ALJ,

however, that there is no evidence to establish that Renken

intended to deceive the Commission; rather, his actions appear

to have been motivated by poor judgment. A moderate demerit

will be imposed against Genesis on these matters and will be

considered together with all the other relevant comparative

factors.

26. Other Matters. Genesis excepts to the ALJ’s failure to

add two issues it sought (a) whether WOJO exercised sufficient

control over its brokered programs; and (b) whether WOJO

made good faith efforts to carry out its non-entertainment

programming set out in its 1973 renewal application. We will

deny Genesis’ exceptions. The Board has reviewed the ALJ's

Memorandum Opinion and Order denying the requested issues

(FCC 81M-2120, released July 15, 1981) and concludes that it

adequately and persuasively sets forth sufficient reason why

the requested issues should be denied. See also the Bureau's

Br. 8-11. Further discussion on this matter is unnecessary.

WOJO also claims that the ALJ erred in not adding a reporting

issue, and in not expanding the carelessness issue, against

Genesis based on further reporting omissions. These excep-

tions, too, will be denied as being of no decisional significance

since a moderate comparative demerit was assessed against

Genesis and the derelictions, even if proven, would merely be

cumulative.

27. Overall Comparative Evaluation; Several recent com-

parative renewal cases mentioned above, para. 1, establish that

primary significance is accorded a broadcaster's past perfor-

mance since that factor affords the strongest and most reason-

able basis for determining whether the public will be served by

license renewal. A broadcaster who renders meritorious serv-

ice can reasonably be confident of renewal. Thus, anincumbent

with substantial past performance is awarded a comparative

preference, the weight of which may overbalance the factors of

diversification and participation which are usually decisive in

comparative proceedings involving only initial licensing. See

Cowles Broadcasting, Inc., supra, at 1015. In affirming the

27a

Cowles decision, the Court cautioned that relevant factors “are

all to be weighed, all at once, all with an eye toward the public

interest. Nothing is removed from the scales until the balance

is struck.” Central Florida Enterprises, Inc. v. FCC, supra,

683 F.2d at 507 n. 16. Like the ALJ we will now weigh all the

relevant factors. Based on our own review of its past perfor-

mance we have found that Station WOJO is entitled to a strong

preference. Moreover, we agree with the ALJ that WOJO is

also entitled to a substantial preference for its proposed format

of Spanish language programming which appears to have

evolved from its past experiences and the wide area coverage of

its station. Genesis on the other hand is entitled to a substan-

tial preference for diversification and a moderate preference for

participation, which in the present context, are of lesser com-

parative significance than WOJO’s preferences. Its preferences

are further diminished by the demerit which the ALJ correctly

awarded for carelessness. Together, Genesis’ preferences are

not sufficient to outweigh WOJO’s preferences for pas* and

proposed programming service.

28. ACCORDINGLY, IT IS ORDERED, That the applica-

tion of Broadcast Communications, Inc. for renewal of the

main, auxiliary, and sub-carrier authorization licenses for Sta-

tion WOJO(FM), Evanston, Illinois (File Nos. BRH-85 &

BRSCA-206) ARE GRANTED, and the application of Genesis

Broadcasting Limited (File No. BPH-10386) IS DENIED.

Joseph A. Marino

Chairman, Review Board

Federal Communications Commission