Minority Ownership of Broadcast Properties: A Legal Analysis

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Minority Ownership of Broadcast Properties:

A Legal Analysis

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February 1, 2010

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RL34269

CRS Report for Congress

Prepared for Members and Committees of Congress

Minority Ownership of Broadcast Properties: A Legal Analysis

Summary

Amidst growing media ownership consolidation and a significant decline in minority ownership

of telecommunications businesses, there has been renewed interest in programs that foster

diversity among telecommunications business owners. One potential avenue under consideration

is to revive, in revised fashion, a tax program that would allow current owners who sell their

broadcast properties to eligible purchasers to defer taxes on gains from the sale. That program had

been available for sales to minority-owned firms, defined as socially and economically

disadvantaged businesses (SDBs). It was abolished by Congress in 1995 amidst allegations of

abuse. In that same year, the Supreme Court held that all government race-based classifications

must meet the most exacting standard of review applied by the Court, meaning that all racial

classifications must be narrowly tailored to achieve a compelling government interest. To the

extent that legislation or FCC programs seek to increase racial and ethnic minority ownership of

broadcast stations, they are likely to be subjected to intense scrutiny if challenged in court. The

analysis that may be conducted is discussed in detail in this report.

Congressional Research Service

Minority Ownership of Broadcast Properties: A Legal Analysis

Contents

Overview ....................................................................................................................................1

Background ................................................................................................................................1

Judicial Review of Racial Classifications in Broadcast Ownership Policies .................................3

Strict Scrutiny .......................................................................................................................3

Compelling Interest.........................................................................................................4

Narrow Tailoring.............................................................................................................6

Contacts

Author Contact Information ........................................................................................................9

Congressional Research Service

Minority Ownership of Broadcast Properties: A Legal Analysis

Overview

Diversity of viewpoint has long been a primary goal of U.S. communications policy. Congress

and the Federal Communications Commission (FCC) have a history of supporting programs that

foster diversity of broadcast station ownership, in general, and minority and female ownership, in

particular, as a means to achieve that goal. The courts have reinforced the notion that minority

ownership is a valid concern that should be addressed by the FCC when constructing its media

ownership rules,1 but also have set restrictions on how programs can be structured to foster that

goal.2

The FCC is under judicial mandate to consider how its ownership rules will affect minority

ownership of broadcast stations.3 On May 5, 2009, the FCC issued a Notice of Proposed

Rulemaking (NPRM) seeking comment on methods to improve the agency’s data regarding

minority and female ownership of broadcast properties. 4 The new data may be used to aid the

FCC in deciding whether and to what extent programs to increase minority and female ownership

should be implemented. Also, two bills were introduced in the 110th Congress that would have

revived a tax incentive to aid certain businesses seeking to acquire telecommunications, including

broadcast, properties.5 Insofar as these proposals define minorities based on race, they will be

subject to strict review by the courts. Structuring the programs narrowly may be necessary in

order to survive a judicial challenge.

Background

From 1978 to 1995, the FCC operated a tax certificate program under §1071 of the Internal

Revenue Code (IRC) that was designed, among other goals, to aid minority-owned economically

disadvantaged businesses in acquiring broadcast properties in furtherance of the FCC’s

congressional mandates relating to ownership and control of broadcasting stations.6 To qualify for

a tax certificate, the purchasing business had to be controlled by a minority. 7 At the time, the FCC

defined minorities as those of “Black, Hispanic Surnamed, American Eskimo, Aleut, American

Prometheus Radio Project v. FCC, 373 F.3d 372 (2004).

Adarand Constructors v. Peña, 515 U.S. 200, 227 (1995).

See Prometheus, 373 F.3d at 421.

In the Matter of 2006 Quadrennial Regulatory Review - Review of the Commission’s Broadcast Ownership Rules and

Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996, Report and Order and Fourth

Further Notice of Proposed Rulemaking, MB Docket No. 07-294 (May 5, 2009). FCC Chairman Julius Genachowski

mentioned in a recent speech that the FCC will review for possible implementation recent recommendations from the

Federal Advisory Commission on Diversity, which include potentially “restor[ing] the designated entity program to

increase opportunities for small businesses, women-owned, and minority-owned businesses.” Julius Genachowski,

Chairman, Fed. Comm. Comm’n, National Association of Black Broadcasters 33rd Annual Fall Broadcast Management

Conference, (Sept. 25, 2009).

See H.R. 600, H.R. 3003, 110th Cong. (2007).

26 U.S.C. §1071 (repealed 1995, P.L. 104-7, §2); Statement of Policy on Minority Ownership of Broadcast Facilities,

68 F.C.C. 2d 979 (1978).

Control was defined as ownership of more than 50 percent of the voting power in the business. Commission’s Policy

Regarding the Advancement of Minority Ownership in Broadcasting, and Notice of Proposed Rulemaking, 92 F.C.C.

2d 853-855 (1982).

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Minority Ownership of Broadcast Properties: A Legal Analysis

Indian, or Asiatic American extraction.”8 If the certificate was granted the selling corporation was

allowed to defer paying taxes on any capital gain from the sale.

In 1995, certain aspects of the program were questioned by Congress when Viacom structured a

deal to sell a large portion of its broadcast property to an entity that qualified as a minority-owned

business. The deal was conditioned upon receiving the tax certificate under the FCC’s program.

Some Members of Congress took notice when they learned that the deal could allow Viacom to

defer an estimated $440 million to $640 million in taxes.9

Congress expressed concern that the tax certificate program provided little protection from

abuse.10 There was no limit to the amount of gain on a sale that could be deferred. 11 Furthermore,

minority ownership was only required to continue for one year from the date of sale.12 Members

were also concerned that the short holding period requirement rendered the tax incentive

ineffective, because properties could quickly transfer from minority ownership without penalty. 13

Amidst these concerns, Congress repealed IRC §1071.14

The FCC also currently has in place a “distress sale” policy that allows broadcasters whose

licenses have been designated for a revocation hearing to sell those licenses to qualified minorityowned buyers before the hearing.15 Use of the “distress sale” program and other FCC policies that

encourage minority ownership of broadcast stations has declined since the Supreme Court

announced its opinion in Adarand Construction v. Peña amidst concerns that the programs, in

their current form, could not withstand a legal challenge. 16

On August 1, 2007, the FCC issued a Second Further Notice of Proposed Rulemaking (SFNPR)

in its review of the Commission’s Broadcast Ownership Rules. The SFNPR contained 14

proposals for the amendment of the FCC’s Broadcast Ownership Rules, 10 of which would

require a definition for Socially Disadvantaged Businesses (SDBs).17 The SFNPR invited

comment for the definition of SDBs, including how such a definition would comply with

constitutional standards.18

Statement of Policy on Minority Ownership of Broadcast Facilities, 68 F.C.C. 2d 979 at note 8.

FCC’s Tax Certificate Program: Hearings Before the Senate Comm. On Finance, 104th Cong. 21-22 (1995)

[hereinafter Hearings].

Hearings, supra note 9, at 22-23, 28-29.

In the Matter of Amendment of Section 73.3597 of the Commission’s Rules (Applications for Voluntary Assignments

or Transfer of Control), 99 F.C.C. 2d 971, 974 (1985).

Id.

Hearings, supra note 9, at 23-25.

An Act to amend the Internal Revenue Code of 1986 to permanently extend the deduction for the health insurance

costs of self-employed individuals, to repeal the provision permitting nonrecognition of gain on sales and exchanges

effectuating policies of the Federal Communications Commission, and for other purposes, P.L. 104-7, §2.

Statement of Policy on Minority Ownership of Broadcast Facilities, 68 F.C.C. 2d at 983.

In the Matter of 2006 Quadrennial Regulatory Review - Review of the Commission’s Broadcast Ownership Rules

and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996, 22 FCC Rcd 14215 (2007),

Appendix A.

Id.

Id., at para. 9.

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Minority Ownership of Broadcast Properties: A Legal Analysis

The FCC adopted new rules to promote diversification of broadcast ownership on December 18,

2007.19 The order was published on March 5, 2008.20 The new rules define eligible entities as

“any entity that would qualify as a small business consistent with Small Business Administration

standards for its industry grouping, based on revenue.”21 This definition does not appear to take

the race or gender of the owner of the eligible entity into account; the FCC is seeking further

comment on whether the definition of “eligible entity” may be expanded. 22

In May of 2009, the FCC issued a Fourth Further Notice of Proposed Rulemaking in this

proceeding.23 The agency is seeking to improve its data on minority and female ownership of

broadcast properties by modifying and expanding reporting requirements for broadcasters as well

as improving the agency’s database. Once the data have been gathered, the FCC may attempt to

use the new information to develop programs to encourage broadcast station ownership by

minorities and women. However, to the extent that those programs are designed to benefit

individuals based on their race, they will likely be subject to the standard of review described

below.

Judicial Review of Racial Classifications in

Broadcast Ownership Policies

In 1995, the Supreme Court decided Adarand Construction v. Peña, which held that all racebased classifications by the federal government must withstand strict scrutiny, as discussed in the

following section. 24 New tax incentives or other broadcast ownership policies that give preference

to racial minorities, therefore, would need to withstand close judicial analysis.

Strict Scrutiny

In Adarand, the Supreme Court declared that any racial classification by government at any level

(state, local, or federal) must comply with strict scrutiny.25 Strict scrutiny is the most exacting

Press Release, FCC Adopts Rules to Promote Diversification of Broadcast Ownership (Dec. 18. 2007), available at

http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-279035A1.pdf.

In the Matter of Promoting Diversification of Ownership in Broadcasting Services, 2006 Quadrennial Regulatory

Review—Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant to Section 202 of

the Telecommunications Act of 1996, 2002 Regulatory Review—Review of the Commission’s Broadcast Ownership

Rules and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996, Cross-Ownership of

Broadcast Stations and Newspapers, Rules and Policies Concerning Multiple Ownership of Radio Broadcast Stations

in Local Markets, Definition of Radio Markets, Ways to Further Section 257 Mandate to Build on Earlier Studies, MB

Docket No. 07-294, MB Docket No. 06-121, MB Docket No. 02-277, MM docket No. 01-235, MM Docket No. 01317, MM Docket No. 00-244, MB Docket No. 04-228 adopted December 18, 2007, released March 5, 2008.

Id. at ¶ 6.

Id. at ¶¶ 80-83.

In the Matter of 2006 Quadrennial Regulatory Review - Review of the Commission’s Broadcast Ownership Rules

and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996, Report and Order and

Fourth Further Notice of Proposed Rulemaking, MB Docket No. 07-294 (May 5, 2009).

Adarand, 515 U.S. at 227. For a more detailed discussion of the Adarand decision, and the proceedings following

that case, see CRS Report RL33284, Minority Contracting and Affirmative Action for Disadvantaged Small Businesses:

Legal Issues, by (name redacted).

Id.

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Minority Ownership of Broadcast Properties: A Legal Analysis

review a court will undertake and requires the government to prove the measure is necessary to

achieve a compelling government interest and that the program is narrowly tailored to achieve

that interest. 26 The Court reasoned that this requirement was in line with the intentions of the Fifth

and Fourteenth Amendments, which protect individuals and not groups from discrimination based

on race.27 Government action that distinguishes between individuals based on membership in a

racial or ethnic group is inherently suspect and warrants the most exacting review. 28

Compelling Interest

Law or regulation that would attempt to define SDBs using the race or ethnicity of the business

owners as a factor in determining eligibility would have to meet strict scrutiny, as mandated by

the Court in Adarand. The first question a reviewing court would ask is whether the interest the

legislation or regulation seeks to achieve is “compelling.” In the context of tax provisions and

FCC programs that encourage SDBs to own broadcast properties, the government interest that has

been articulated is to promote broadcast viewpoint diversity.29 The theory underlying this interest

is that diverse ownership creates diversity of voices and viewpoints in the marketplace of ideas, a

concept essential to our democracy and embodied within the First Amendment.30 The Supreme

Court has acknowledged that diversity of viewpoint in public discussion benefits the populace31

and that the government has an interest in encouraging such diversity over the broadcast

airwaves;32 however, whether that interest is sufficiently compelling to survive strict scrutiny

remains a matter of debate.

Prior to Adarand, the Supreme Court decided Metro Broadcasting v. FCC, and upheld the FCC’s

minority broadcast ownership policies after applying intermediate scrutiny. 33 Intermediate

scrutiny is a less exacting standard than strict scrutiny and requires the government to prove only

that the relevant classification is substantially related to an important government interest. The

Court, agreeing with Congress and with the FCC, held that enhancing broadcast diversity “is, at

the very least, an important government interest.”34

The Metro Broadcasting majority grounded their “important interest” analysis in the scarcity of

electromagnetic spectrum and the government’s duty to distribute that spectrum to encourage the

availability of the widest array of information sources and viewpoints.35 The Court noted that “it

is axiomatic that broadcasting may be regulated in light of the rights of the viewing and listening

audience, and that the ‘widest possible dissemination of information from diverse and

antagonistic sources is essential to the welfare of the public.’”36 According to the Court, it is the

right of the public to receive a diverse array of viewpoints and programming over the publicly

Id.

See Metro Broadcasting, Inc. v. FCC, 497 U.S. 547, 567 (1991).

Id.

See Associated Press v. U.S., 326 U.S. 1 (1945).

See Red Lion Broadcasting Co. v. FCC, 395 U.S. 367 (1969).

Metro Broadcasting, Inc. v. FCC, 497 U.S. 547, 566 (1991).

Id.

Id. at 567.

Id.

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Minority Ownership of Broadcast Properties: A Legal Analysis

owned broadcast airwaves, and it is the duty of Congress and the FCC to safeguard that right.37

Against this backdrop, the Metro Broadcasting majority concluded that the diversity of

viewpoints on the broadcast airwaves serves important First Amendment principles and that this

was sufficient basis for the minority ownership policies.38 Though Metro Broadcasting can

provide some guidance as to the arguments that would be advanced in favor of finding that

broadcast viewpoint diversity is a compelling government interest, because the Court applied a

lower standard of scrutiny to what it termed a “benign racial classification,” deeper analysis is

required to determine if the interest is sufficiently compelling to withstand strict scrutiny.39

The Court made clear in Adarand that strict scrutiny is not “strict in theory, but fatal in fact.”40

Justice O’Connor noted, “[t]he unhappy persistence of both the practices and lingering effects of

racial discrimination against minorities in this country is an unfortunate reality, and the

government is not disqualified from acting in response to it.”41 This language suggested to some

that in order to survive strict scrutiny racial classifications would be permissible only to remedy

the effects of past discrimination. Such an interpretation probably would have ruled out the

legitimacy of all other justifications for classification of individuals based on their race. The

dissent in Metro Broadcasting, in fact, would have applied strict scrutiny to the ownership rules at

issue in that case.42 The dissenters would have determined that broadcast ownership diversity was

not a compelling interest and noted that only one compelling interest supporting a race-based

classification had ever been recognized—to remedy past discrimination.43

In light of recent decisions, however, it is possible that diversity of broadcast viewpoint could be

classified as a compelling interest.44 In Grutter v. Bollinger, the Court made clear that remedial

classifications are not the only racial classifications that will survive strict scrutiny. 45 In Grutter,

the Court held that diversity within a student body is a compelling interest sufficient to withstand

strict scrutiny.46 The Court relied heavily upon the reasoning of Justice Powell’s opinion in

Regents of University of California v. Bakke for its determination that student body diversity is a

compelling government interest.47 Underpinning Powell’s opinion in Bakke were strongly rooted

Red Lion, 395 U.S. at 390, see also Metro Broadcasting, 497 U.S. at 567.

Metro Broadcasting, 497 U.S. at 567.

To the extent that Metro Broadcasting applied intermediate scrutiny to race-based classifications, Adarand overruled

Metro Broadcasting. 515 U.S. at 227.

515 U.S. at 237.

Id.

497 U.S. at 614.

Id.

Grutter v. Bollinger, 539 U.S. 306, 329 (2003) (holding that “[n]ot every decision influenced by race is equally

objectionable and strict scrutiny is designed to provide a framework for carefully examining the importance and

sincerity of the reasons advanced by the governmental decisionmaker in that particular context”). For a detailed

discussion of racial classifications as it pertains to school admissions policies, see CRS Report RL30410, Affirmative

Action and Diversity in Public Education: Legal Developments, by (name redacted).

Grutter, 539 U.S. at 332 (noting that the Court has “never held that the only governmental use of race that can

survive strict scrutiny is remedying past discrimination”).

Id. at 330; see also Parents Involved in Comm. Sch. v. Seattle Sch. Dist. No. 1, 127 S.Ct. 2738, 2789 (2007)

(Kennedy J. concurring) (stating that “[d]iversity, depending on its meaning and definition, is a compelling educational

goal a school district may pursue”).

Regents of Univ. Of California v. Bakke invalidated an admissions policy at a California medical school which set

aside a certain number of seats each year for a certain number of particular minority groups. 438 U.S. 265 (1978).

Though invalidating the admission policy at issue, Justice Powell nonetheless held that student body diversity was a

permissible interest sufficiently compelling to warrant the use of a racial classification. Id. at 311-312.

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Minority Ownership of Broadcast Properties: A Legal Analysis

First Amendment principles and the educational need for diverse viewpoints to enhance the

learning experience.48 Powell argued that in “seeking the right to select those students who will

contribute most to the ‘robust exchange of ideas,’ a university seeks to achieve a goal that is of

paramount importance to the fulfillment of its mission.”49 The Grutter majority adopted this

analysis, and further justified its determination by according deference to the University

administration in the selection of it students.50 The Court noted that selection of a diverse student

body is “at the heart of the” school’s “proper institutional mission,” and that “good faith” on the

part of the university should be presumed. 51 Because the educational benefits that diversity

provided were supported by the evidence, the Court accorded the university’s judgment of a

compelling interest in student body diversity a degree of deference. 52

Arguably, there are a number of similarities between the compelling interest found in creating a

diverse student body and that found in creating diversity of broadcast programming. The majority

in Metro Broadcasting equated the interest in the creation of a diverse student body with the

interest in creating diversity over the broadcast airwaves.53 Both interests have as their foundation

the First Amendment principles encouraging the ‘robust exchange of ideas.’54 Both interests serve

the important purposes of public education and freedom of speech.55 Both interests also serve a

wider range of people than the minority groups who would benefit ostensibly from any

implemented policy. 56 The entire student body benefits from exposure to diverse people and

ideas.57 Likewise, the entire audience benefits from diverse viewpoints aired over broadcast,

regardless of their race or ethnic background. 58 Consequently, it appears that a case could be

made based on these similarities for a finding that broadcast diversity is a compelling interest.

Narrow Tailoring

Assuming that viewpoint diversity in broadcasting is a compelling governmental interest, the

government then must prove that the program is necessary and narrowly tailored to achieve that

interest. The Supreme Court has yet to decide the parameters of a narrowly tailored program in

this context, however, examples of narrow tailoring in other contexts and the Court’s analysis in

Metro Broadcasting may provide guidance.

The government must first show that diversity of broadcast ownership is necessary to increase

diversity of broadcast viewpoint. The Metro Broadcasting majority gave weight to the findings of

Congress and the FCC that minority-owned broadcast stations produced programming that was

Bakke, 438 U.S. at 312.

Grutter, 539 U.S. at 324, citing Bakke, 438 U.S. at 312, 314.

Grutter, 539 U.S. at 332.

Id. at 333.

Id.

Metro Broadcasting, 497 U.S. at 568.

Metro Broadcasting, 497 U.S. at 567-68; Grutter 539 U.S. at 333; see also Bakke 438 U.S. at 312.

Metro Broadcasting, 497 U.S. at 567-68; Grutter 539 U.S. at 333.

Metro Broadcasting, 497 U.S. at 567-68 (arguing that the benefits of diversity “redound to all members of the

viewing and listening audience”); Grutter 539 U.S. at 334 (noting that increased diversity helps students to better

understand different races).

Grutter 539 U.S. at 334.

Metro Broadcasting, 497 U.S. at 567-68.

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Minority Ownership of Broadcast Properties: A Legal Analysis

qualitatively different from their counterparts, and the finding that this programming contributed

to broadcast programming diversity. 59 The Court also deferred to the findings of Congress and the

FCC that many minority viewpoints were underrepresented in broadcast programming and that

race-neutral methods of increasing that representation had failed repeatedly. 60 With these

conclusions in mind, the Court found that increased diversity of broadcast property ownership is

substantially related to increased diversity of broadcast programming. 61 A conclusion, however,

that a policy is substantially related to the achievement of an interest does not mean that the

program is “necessary” to achieve that interest. The concerns of the dissenting Justices in Metro

Broadcasting could provide guidance for the required nexus between broadcast property

ownership and diversity of programming that would support a finding of necessity.

The dissenting justices in Metro Broadcasting found no supporting evidence for the concept that

increased diversity among owners increased diversity of viewpoint, much less that a policy

favoring minority ownership was necessary to increase diversity of viewpoint.62 The dissenters

observed that the ownership policies were based on the assumption that minority-owned stations

provide desired viewpoints, and that stations not owned by minorities do not or cannot provide

these viewpoints.63 The dissenters opined that the FCC was barred by Congress from examining

the factual basis for the asserted nexus between broadcast programming diversity and diversity

among broadcast property owners, and that the evidence purporting the existence of a nexus was

too weak to support a finding of necessity. 64 Without stronger evidence that this assumption was

correct, the dissenters could not conclude that increased minority ownership was necessary to

achieve increased diversity of broadcast programming.65 The Metro Broadcasting dissenter’s

opinion could suggest a closer examination by the Court of the factual basis supporting the

minority ownership program, than the deference accorded to Congress’s fact finding by the Metro

Broadcasting majority. Consequently, any future minority ownership policies that use race as a

factor may need to be supported by evidence that demonstrates a tighter correlation between

diversity of ownership and diversity of viewpoint in programming in order to establish that such

policies are necessary to increase diversity of broadcast viewpoint.66

Not only must the government show that diversity of broadcast station ownership leads to

diversity of broadcast viewpoint, the government must also show that other race-neutral methods

of achieving the goal of broadcast viewpoint diversity were considered. In Grutter, the Court held

Metro Broadcasting, 497 U.S. at 578-579.

Id. at 553-554.

Id. at 564.

Id. at 617-619.

Id. at 618.

Id. at 628.

Id. at 627 (noting that to “the extent that the FCC cannot show the nexus to be nearly complete, that failure confirms

that the chosen means do not directly advance the asserted interest”).

On July 31, 2007, the FCC released 10 economic research studies on media ownership to the public and sought

comment on those studies. FCC Seeks Comment on Research Studies on Media Ownership, MB Docket No. 06-121.

At least three of the studies directly address minority and female ownership. Whether the data they provide would be

sufficient to sustain a finding that minority and female ownership of broadcast stations is necessary to achieve

broadcast viewpoint diversity is uncertain. For a more detailed discussion of the ownership studies released for

comment by the FCC, see CRS Report RL34271, The FCC’s 10 Commissioned Economic Research Studies on Media

Ownership: Policy Implications, by (name redacted). See also

Oversight of the Federal Communications

Commission - Media Ownership: Hearing Before the Subcom. on Telecommunications and the Internet, 110th Cong.

(Dec. 5th 2007).

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Minority Ownership of Broadcast Properties: A Legal Analysis

that “[n]arrow tailoring does not require exhaustion of every conceivable alternative,” but does

require “serious, good faith consideration of workable race-neutral alternatives.”67 The

government likely would be required, therefore, to consider race-neutral options for fostering

diversity before adopting a program that takes race into account.

Assuming that a court found that diversity of ownership is necessary to achieve diversity of

viewpoint, the government again must then prove that the program encouraging diversity of

ownership is narrowly tailored to achieve the stated interest. Again, looking to the higher

education cases and the dissent in Metro Broadcasting could inform the analysis of whether a

particular minority broadcast ownership program would be narrowly tailored. In Metro

Broadcasting, the dissent took particular issue with the fact that the policies at issue in that case

were geared solely toward benefitting certain minorities, calling the policies “a 100% set aside,”

which placed impermissible burdens on non-minorities. 68 The dissenters concluded that the FCC

was attempting to allocate certain licenses based on race, an action prohibited by the

Constitution.69 “Quotas” or “set asides” that place rigid numeric goals for inclusion of certain

racial groups also fail in the school admissions cases.70 Whenever a school admissions policy has

placed a numeric goal on the numbers or percentages of minorities desired, the policy has been

struck down by the Supreme Court as violating the Equal Protection Clause. 71

In Grutter, however, the Court provided guidance for the types of permissible school admissions

policies that use race as a factor.72 The Court held that taking race into account when making

graduate school admission decisions is permissible so long as no strict quota system is used. 73

Admissions decisions made on an individualized basis may take race into account, among the

many other factors used, when deciding how a particular individual would contribute to the

diversity of the educational environment. 74 The Court noted that many other variables were

considered when deciding whether or not to admit an individual applicant and that race was only

one factor included in determining the extent to which an individual would contribute to student

body diversity.75 The individualized nature of the determination seemed to assuage the Court’s

constitutional concerns, because the applicants were not evaluated or awarded admission based

Grutter, 539 U.S. at 339.

Metro Broadcasting, 497 U.S. at 630.

Id. at 627.

Recently, the Supreme Court struck down school plans that attempted to achieve a racial demographic balance at the

primary and secondary school level as violating the Equal Protection Clause. Parents Involved in Comm. Sch., 127

S.Ct. at 2746-2751. The Court found the programs were not narrowly tailored because their minimal impact on school

enrollment was insufficient to support a finding that the program was necessary. Id. at 2759. Also, the Court was

concerned that methods other than racial classifications could have been used to achieve the desired goals. Id.

See Parents Involved in Comm. Sch., 127 S.Ct. at 2759; Gratz v. Bollinger, 539 U.S. 244 (2003) (striking down an

admissions policy that awarded one-fifth of the total required points for guaranteed admission to applicants based

solely on their race as not being narrowly tailored); Bakke, 438 U.S. at 265 (invalidating an admissions policy that set

aside a certain number of seats for racial minorities).

Grutter, 539 U.S. at 334. The school admissions program in Grutter sought to admit a “critical mass” of minority

students Id. at 319. The Court held that this goal of admitting a not insignificant number of minority students did not

transform the program “from a flexible admissions system into a rigid quota.” Id. at 326-327. The Court noted the

varying percentages of minority admissions from year to year, and was satisfied that the university was not concealing

an attempt to achieve racial balancing. Id.

Grutter, 539 U.S. at 334, see also Regents of Univ. of Cal. v. Bakke, 438 U.S. at 265.

Grutter, 539 U.S. at 334.

Id. at 337.

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Minority Ownership of Broadcast Properties: A Legal Analysis

solely on their membership in a certain group.76 Furthermore, because the admissions program

was based on individual assessments of contributions to diversity, the program did not place an

“undue burden” on non-minority applicants.77

Similarly, when encouraging diversity of broadcast ownership, it appears that a court would be

more likely to uphold as narrowly tailored a program that accounts for the race of the owners if

the program uses race as but one of a number of factors that could contribute to diversity of

viewpoint.78 In addition, consideration may need to be given to the amount of “diverse”

programming already available in individual markets.

An additional consideration in designing a narrowly tailored program that uses race as a factor is

that the program must have reasonable durational limits.79 In Grutter the Court indicated that, in

the context of admissions preferences, a program could meet the durational requirement for

narrow tailoring through sunset provisions or periodic reviews to determine whether the racial

preference remained necessary.80 Similar controls may be required as a component of any new

minority ownership programs enacted by Congress or promulgated by the FCC.

Author Contact Information

(name redacted)

Legislative Attorney

[redacted]@crs.loc.gov, 7-....

Id.

Id. at 334.

Id. at 341-342.

Id. at 342.

Congressional Research Service

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