An FCC rule change updating rules for low-power TV stations and translators took effect Tuesday, said a public notice in docket 03-185. Approved in April, the order updated the language of FCC rules for clarification and to reflect the digital transition. Portions of the rules took effect June 12, but others required Paperwork Reduction Act approval from the Office of Management and Budget, which was handed down Tuesday.

Tennessee radio station WJBE(AM) Powell -- the only black-owned station in its area -- won’t lose its license over a 2016 felony tax fraud conviction by owner Joseph Armstrong, ruled FCC Administrative Law Judge Jane Halprin Thursday. “The station has an overall positive record of public service and the evidence suggests a sincere commitment to its listeners,” wrote Halprin. “As a result, the Presiding Judge finds that Mr. Armstrong’s felony conviction does not warrant revocation of Arm & Rage’s license for WJBE.” said the decision. Armstrong -- a former Tennessee state legislator -- was convicted over failing to include $300,000 in profits on a tax form. The profits came from Armstrong buying and then flipping cigarette tax stamps as the legislature increased the state’s cigarette tax. Armstrong committed the crime in 2007, bought the station in 2013, and was convicted in 2016, which he reported to the FCC 14 days later than required. The FCC granted WJBE’s renewal in 2020, and only designated the matter for hearing in 2022. In her decision, Halprin rejected Enforcement Bureau arguments that the EB should have been permitted to investigate other possible tax issues involving Armstrong. “In pursuing wide-ranging discovery regarding other tax issues, the Enforcement Bureau essentially asked Arm & Rage to perform a self-audit to identify other potential federal income tax violations,” wrote Halprin “This proceeding is not intended to relitigate the crime or second-guess the trial court’s findings.” Halprin also pushed back on EB arguments that minor violations of FCC procedural rules by the station showed a pattern of dishonest behavior, and denied what she called “overly broad” discovery requests about possible rule violations. The station’s FCC compliance is relevant to the case but “it does not follow” that “virtually unlimited discovery regarding other potential violations of the Commission’s rules was warranted.” The EB should have presented additional evidence to justify forays into Armstrong’s tax history and FCC compliance, she said. “Absent Mr. Armstrong’s felony conviction, it is doubtful that this matter would have been designated for hearing,” Halprin wrote.

A recent FCC Media Bureau Audio Division notice of apparent liability confirms that agency permission isn’t needed for gradual changes in noncommercial educational broadcaster governing boards, said Wiley broadcast attorney Kathryne Dickerson in an interview and blog post. In an August NAL proposing a $20,000 forfeiture (see 2308280071) for Olympia, Washington, translator owner Northwest Rock N Roll Preservation Society (NWR), the Audio Division rejected an accusation that the broadcaster had changed ownership without the FCC’s go-ahead because the multiple changes to the NWR board had happened over time rather than all at once. “We find that, because the nature of the changes to the NWR board were gradual, no unauthorized transfer of control of NWR occurred,” said the NAL. Though the agency made a similar ruling in a tentative conclusion in a 1989 notice of inquiry, it has never adopted the policy as a formal ruling, Dickerson said. In the August NAL, the agency said that though it isn’t bound by the 1989 NOI, the FCC “has hewed to them in later policy-making decisions.” With biennial ownership reports due soon, that acknowledgment should give some certainty for many NCE stations unclear on their status, Dickerson said. The decision is particularly notable because the NWR board gradually underwent a total changeover between 2010 and 2022, without FCC authorization, Dickerson said. The NAL's providing clarity on the agency’s view of such changeovers could save many NCE organizations time and money in preparing their ownership reports, Dickerson said.

The FCC’s authority over broadcast license transfers doesn’t apply to Gray Television’s 2020 purchase of another broadcaster’s CBS network affiliation because no licenses were transferred, said Gray's reply brief late Wednesday (docket 22-14274) at the 11th U.S. Circuit Court of Appeals. The FCC’s rule barring affiliation swaps, called Note 11, “is a freestanding and unbounded prohibition on certain programming purchases that has no basis in the FCC’s licensing authority,” said the brief. Congress didn’t grant the agency power over sales of network affiliation and the FCC “cannot fall back on” arguments that it has ancillary authority over other transactions “whenever it wants to do more than Congress allowed,” Gray said. By interpreting Note 11’s language against swaps to also apply to affiliation purchases and applying the rule to Gray’s deal with Denali media, the FCC “improperly redefined and expanded” Note 11 to bar any deal that creates a new top-four combination while the text of Note 11 states that the rule applies to transactions that result in a broadcaster owning two top-four stations. Since Gray already owned two top-four stations in the Anchorage market in 2020, it has argued that Note 11 doesn’t apply. With this interpretation of Note 11, the FCC “violated the principle that an agency must give fair notice of prohibited conduct before imposing penalties,” Gray said. The agency also “botched” the calculation of the $518,000 forfeiture by adding to the penalty for every day of the violation and adding the explanation that the violation was egregious “only after Gray responded to the NAL,” said the brief. “None of the FCC’s unauthorized transfer of control precedents supported the imposition of such a penalty,” Gray said. The FCC’s assertion it considered Gray’s efforts to mitigate the violation in calculating the forfeiture is an “empty boilerplate statement" and the agency provided only “incompetent evidence” that the Denali transaction led to substantial economic gain for Gray, the brief said.

Protecting broadcasting “should not mean inviting hedge funds, private equity, and other predatory investors to undermine local broadcasting in order to extract profits,” said Claude Cummings, president-Communications Workers of America (CWA), and Charlie Braico, president-National Association of Broadcast Employees and Technicians-CWA, in a news release Wednesday responding to testimony and a blog from NAB CEO Curtis LeGeyt. Both unions were part of the successful opposition to Standard's proposed buy of Tegna. Any efforts at the FCC or Congress to change the merger review process should ensure unions have standing to oppose broadcast deals, include labor markets as part of public interest review, and preserve the fact-finding hearing process, the unions said. “In his call for a simple ‘up or down vote,’ LeGeyt is more concerned with rushing the process than with transparency and thoroughness,” the unions said. “Employment at broadcast TV stations is material to determining whether localism, and therefore the public interest, is being served by a transaction.” NAB didn't comment.

Fox Television Stations didn’t properly maintain WTXF-TV Philadelphia’s online public file and then misrepresented whether it had done so, said the Media and Democracy Project in a letter to the FCC Monday. MAD conceded in the letter that online public file violations aren’t typically a basis for license renewals to be designated for hearing but said they are relevant when considered alongside the other allegations raised against parent company Fox. “Material misrepresentations however minor add to the disqualifying grounds already set forth,” said the letter. MAD argued that political advertising contracts were uploaded to the file late -- in some case after the ads had aired -- and said FTS misrepresented those contracts as inquiries to bolster its contention the filings weren’t late. MAD also took aim at FTS arguments that technical difficulties with the online public file affected filing times. The FCC and numerous attorneys have experienced issues with the agency’s filing systems throughout 2023 (see 2306200063), but FTS didn’t adequately document such a problem, MAD said. “If FTS truly was unable to timely file political contracts due to technical difficulties, it should have included the details in its renewal application,” MAD said. “FTS did none of this and is now offering post hoc excuses to justify its repeated failure.” Fox didn’t comment.

With the FCC now at five commissioners (see 2309070081), the agency should act on “ambitious and necessary reforms” to preserve local broadcasting, said NAB CEO Curtis LeGeyt in a blog post Friday. The FCC “must actively consider whether their policies, which value a strong system of local broadcasting, are keeping pace” with modern competition, LeGeyt said. The five-person commission should ensure the agency’s merger review process “will conclude with an up or down vote in a timely fashion,” said LeGeyt, likely referencing the failed Standard General/Tegna merger (see 2306010077). “Opaque and shifting guidelines about broadcaster transactions can deter potential buyers from investing in new and established entrants,” he wrote. The agency should also refresh the record in docket 14-261 on reclassifying streaming services -- sometimes called virtual MVPDs -- as MVPDs bound by retransmission consent requirements, LeGeyt said. “The system of regulations applied to legacy pay-TV providers recognizes the importance local broadcasters play in their communities.” LeGeyt also urged the agency to relax broadcast ownership rules so broadcasters can scale up to compete with larger digital media companies. “As broadcasters fight for audiences and advertisers with much larger competitors, having the scale to compete will allow us to continue to improve the quality and local focus of programming,” LeGeyt said.

Sen. Ted Cruz, R-Texas, mentioned the license renewal proceeding for Fox Television Stations-owned WTXF-TV Philadelphia in a floor speech before the confirmation vote for FCC nominee Anna Gomez Thursday. The FCC “is now entertaining requests by radical left-wing groups to revoke a broadcast station’s license for alleged ‘misinformation’ and turning a routine FCC license renewal proceeding into a truth commission,” said Cruz. The petition to deny 's supporters are “bipartisan including Bill Kristol, former editor of Murdoch’s conservative Weekly Standard magazine, Al Sikes, former Republican Chairman of the FCC and me -- longtime Republican enabler of Fox!,” said former Fox executive and longtime lobbyist Preston Padden in an email. “No one except Senator Cruz is talking about a ‘truth Commission’.” "The Senator's characterization of this effort couldn't be further from the truth," said petitioner the Media and Democracy Project (MAD) in an emailed statement. "The issue here concerns a massive media corporation that, with management's full knowledge and approval, is documented to have lied to millions of Americans." None of the allegations made by MAD against owner Fox Television Stations and its parent company, Fox, should lead to the station’s license being designated for hearing, said Fox in an ex parte meeting Tuesday with FCC Media Bureau Chief Holly Saurer, said an ex parte filing Thursday in docket 23-293. The Communications Act and FCC rules “compel dismissal of MAD’s petition and related filings, and grant of renewal of Fox 29 Philadelphia’s license,” said the filing. FCC rules list a narrow range of categories of non-FCC related conduct that are relevant to considerations of a licensee's character, Fox said. Those include criminal convictions, mass-media antitrust violations, and crimes involving false statements to other government entities. The rules allow for consideration of “non-adjudicated misconduct” but require it to be “so egregious as to shock the conscience and evoke almost ‘universal’ disapprobation,” Fox said. Fox has the “requisite character qualifications and no allegations have been plead concerning potentially ‘relevant’ conduct," the filing said. The MAD petition should also be rejected because it was filed untimely, seeks to apply FCC broadcast rules to cable news, and would amount to changes in the FCC’s character policy without notice or comment, the filing said.

An effort to push the FCC to designate Fox-owned WTXF-TV Philadelphia's license for hearing is "a longshot" but isn’t “frivolous,” wrote Public Knowledge Senior Vice President Harold Feld in a blog post Tuesday. The allegations from the Media and Democracy Project “raise real, if novel questions” on the boundaries of the FCC’s character policies and how the conduct of one part of a company reflects on another subsidiary’s fitness to hold a broadcast license, Feld wrote. The agency will eventually “have to actually write up a real and binding decision with real consequences and real precedential value,” Feld wrote. In an interview, he conceded the FCC could take a long time to do so and could even potentially let the matter sit until a new administration takes over. A previous dispute involving the license of Fox-owned station WWOR-TV Secaucus, New Jersey, caused the FCC to take seven years, from 2007 to 2014, to approve renewal.

The FCC Media Bureau proposed a $20,000 forfeiture over false certifications in an application for Olympia, Washington, translator owner Northwest Rock N Roll Preservation Society (NWR), and the full FCC separately rejected a related application for review from the same broadcaster, said a notice of apparent liability and an order in Monday’s Daily Digest. Both matters appear to involve a conflict between NWR and Bicoastal Media Licenses, with Monday’s orders referencing numerous objections and challenges the two broadcasters have filed against each other. The Media Bureau said NWR made “certifications with an intent to deceive” in a license to cover application after Bicoastal filed a series of objections, the NAL said. NWR falsely certified that new facilities had been constructed to prevent a 2017 permit from expiring, and Bicoastal’s objections presented evidence the station wasn’t operating. Meanwhile, NWR’s rejected application for review challenged a Media Bureau decision denying its appeal of the MB’s grant of a construction permit to Bicoastal. The FCC didn’t agree with NWR arguments that the Media Bureau dismissed NWR’s challenge improperly and didn’t act in a timely fashion, the order said. Despite NWR’s false certifications, the NAL stops short of taking the broadcaster’s license, noting NWR admitted the violations. “We believe NWR can reasonably be expected to deal truthfully with the Commission in the future,” said the NAL.