[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2979 Introduced in House (IH)]


104th CONGRESS
  2d Session
                                H. R. 2979

 To ensure the financial self-sufficiency of public broadcasting, and 
                          for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           February 28, 1996

Mr. Fields of Texas (for himself, Mr. Porter, Mr. Oxley, Mr. Moorhead, 
 Mr. Schaefer, Mr. Barton of Texas, Mr. Hastert, Mr. Gillmor, and Mr. 
    Frisa) introduced the following bill; which was referred to the 
                         Committee on Commerce

_______________________________________________________________________

                                 A BILL


 
 To ensure the financial self-sufficiency of public broadcasting, and 
                          for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Public Broadcasting Self-Sufficiency 
Act of 1996''.

                TITLE I--TRANSITION FROM FEDERAL FUNDING

         Subtitle A--Public Broadcasting Station Opportunities

SEC. 101. DEFINITIONS.

    Section 397 of the Communications Act of 1934 (47 U.S.C. 397) is 
amended by adding at the end the following new paragraph:
            ``(18) The term `transition period' means the period 
        beginning on the date of enactment of the Public Broadcasting 
        Self-Sufficiency Act of 1996 and ending at the close of 
        September 30, 2000.''.

SEC. 102. EXPANDED UNDERWRITING OPPORTUNITIES.

    Section 399B(b) of the Communications Act of 1934 (47 U.S.C. 399b) 
is amended by adding at the end thereof the following new paragraph:
    ``(3) Paragraph (2) shall not prohibit a public broadcast station 
from broadcasting or accepting remuneration for broadcasting--
            ``(A) well-established corporate logos or slogans, even if 
        such logos or slogans include a call to action by the viewer or 
        listener; or
            ``(B) strictly quantifiable comparative descriptions of 
        products, services, or providers of products or services.''.

SEC. 103. PUBLIC/COMMERCIAL PARTNERSHIPS.

    Section 399(b) of the Communications Act of 1934 is further amended 
by adding at the end the following new paragraph:
    ``(4) A noncommercial educational broadcast station may broadcast 
programs produced by, or at the expense of, or furnished by persons 
other than the licensee, and may receive compensation (in addition to 
costs incidental to production and broadcasting) for broadcasting such 
programs.''.

SEC. 104. CONVERSION OF STATIONS TO COMMERCIAL STATUS.

    Subpart E of part IV of title III of the Communications Act of 1934 
is amended by adding at the end the following new section:

``SEC. [399D.] TELEVISION CHANNEL EXCHANGES.

    ``(a) Petition.--The licensees or permittees of a commercial and a 
public broadcast television station may jointly petition the Commission 
to request an exchange of channels (including public broadcast 
television stations on VHF channels to be exchanged for UHF channels). 
The Commission shall, within 90 days after receipt of such a petition, 
amend the television table of allotments and modify the licenses (or 
permits) of the petitioners to specify operation on the appropriately 
exchanged channels upon finding that--
            ``(1) the stations serve substantially the same market; and
            ``(2) the consideration to be paid to the public broadcast 
        television licensee or permittee--
                    ``(A) will be dedicated to the provision of public 
                telecommunications services; and
                    ``(B) fairly reflects the value of the exchange of 
                channels and related facilities.
    ``(b) Other Considerations Prohibited.--In acting on the joint 
petition, the Commission may not consider proposals by other parties to 
become licensees or permittees on the channels to be exchanged.''.

SEC. 105. REMUNERATIVE USES OF OVERLAPPING STATIONS.

    Subpart E of part IV of title III of the Communications Act of 1934 
is further amended by inserting after section 399D (as added by section 
104 of this Act) the following new section:

``SEC. [399E.] REMUNERATIVE USES OF OVERLAPPING STATIONS.

    ``(a) Remunerative Uses.--
            ``(1) Authority to operate for remunerative purposes.--
        Subject to the requirements and limitations of this section, 
        the licensee or licensees of 2 overlapping stations may, 
        notwithstanding the allocated and licensed status of such 
        stations as noncommercial educational television stations, 
        operate one such station for remunerative purposes, including 
        the transmission of commercial television programming 
        originated by such licensee or by another party and 
        transmission of subscription television or pay-per-view 
        services.
            ``(2) Conditions for remunerative use.--The licensee or 
        licensees of overlapping stations intending to operate one of 
        such stations for remunerative purposes pursuant to paragraph 
        (1) shall file with the Commission a joint operating agreement 
        or other instrument providing assurances that--
                    ``(A) the remuneration from such operations (in 
                excess of the costs of the commercial and public 
                television operations of such station) is dedicated to 
                the provision of local public telecommunications 
                services on the other overlapping station to 
                substantially the same market; and
                    ``(B) the station operated for remunerative 
                purposes is, but for the remunerative operations, 
                otherwise operated consistent with the provisions of 
                this Act and the rules and policies of the Commission 
                applicable to such operations.
            ``(3) Ineligibility for grants.--No noncommercial 
        educational television station operating under an agreement or 
        instrument filed under paragraph (2) shall be eligible to 
        receive any grant from funds appropriated pursuant to section 
        396.
    ``(b) Sale of Overlapping Station.--
            ``(1) Sale permitted.--Upon application by the licensee of 
        2 or more overlapping public television stations, the 
        Commission shall approve the assignment of one of the licenses 
        of such licensee for a television station to another person or 
        entity, and shall permit such person or entity to operate such 
        station as a commercial television station, if--
                    ``(A) the licensee assigning such license will 
                dedicate all compensation received for such assignment 
                to the support of the local public telecommunications 
                services on the retained station; and
                    ``(B) the compensation provided to the licensee for 
                assigning such license fairly reflects the value of the 
                license and related facilities.
            ``(2) Ineligibility for grants.--No public television 
        station operated by the licensee making an assignment of a 
        license under paragraph (1) shall be eligible to receive a 
        grant from funds appropriated pursuant to section 396.
    ``(c) Definitions.--For purposes of this section:
            ``(1) Overlapping station.--Two public television stations 
        are `overlapping stations' if the Grade A contour of one of 
        such stations reaches more than 50 percent of the Grade A 
        contour of the other such station in the same television 
        market.
            ``(2) Television market.--The term `television market' has 
        the meaning provided in section 76.55(e)(1) of the Commission's 
        rules (47 C.F.R. 76.55(e)(1)).''.

 Subtitle B--Corporation for Public Broadcasting Financial Flexibility

SEC. 121. RELAXATION AND REDUCTION OF STATUTORY MANDATES.

    (a) Purposes.--Subsection (a) of section 396 of the Communications 
Act of 1934 (47 U.S.C. 396(a)) is amended to read as follows:
    ``(a) Purposes.--The purposes of the Corporation for Public 
Broadcasting shall be--
            ``(1) to promote the delivery of local public 
        telecommunications services which advance education, support 
culture, and foster citizenship for all Americans;
            ``(2) to promote efficiency and effectiveness in the 
        provision of public broadcasting services, through 
        technological advances and, where appropriate, through mergers, 
        consolidations, and joint operating agreements;
            ``(3) to promote and support program production;
            ``(4) to preserve and enhance the geographic and cultural 
        diversity of public broadcasting programs and services;
            ``(5) to support public broadcasting services for rural and 
        underserved areas and audiences;
            ``(6) to create and deliver creative and diverse 
        programming and services of high quality and excellence;
            ``(7) to preserve and protect their editorial integrity and 
        independence; and
            ``(8) to pioneer new telecommunications technologies and to 
        adapt those technologies for educational and public service 
        purposes.''.
    (b) Authorized Activities.--Subsection (g) of such section is 
amended to read as follows:
    ``(g) The Corporation is authorized to take such actions consistent 
with the District of Columbia Nonprofit Corporation Act (D.C. Code, 
sec. 29-1001 et seq.) as it may, in the exercise of its business 
judgment, determine to be necessary to carry out the purposes set forth 
in subsection (a) of this section. To carry out such purposes and to 
take such actions, the Corporation shall have the usual powers 
conferred on a nonprofit corporation by such Act.''.
    (c) Financing.--
            (1) Authorization of appropriations.--Section 396(k)(1) of 
        the Communications Act of 1934 (47 U.S.C. 396(k)(1)) is 
        amended--
                    (A) by striking subparagraph (B) and inserting the 
                following:
    ``(B) There are authorized to be appropriated to the Fund 
$250,000,000 for each of the fiscal years 1998, 1999, and 2000.'';
                    (B) by striking subparagraphs (C) and (E);
                    (C) by redesignating subparagraph (D) as 
                subparagraph (C); and
                    (D) by inserting after such subparagraph (C) the 
                following new subparagraph:
    ``(D) The Secretary of the Treasury shall make the appropriated 
funds under this subsection available on a fiscal year basis.''.
    (d) Allocation of Appropriations.--Section 396(k) of such Act is 
further amended by striking paragraphs (2) through (10) and inserting 
the following:
            ``(2) Budget for allocation.--During the transition period, 
        the Corporation shall establish an annual budget for use in 
        allocating amounts from the Fund. Of the amounts appropriated 
        into the Fund available for allocation for any fiscal year 
        during the transition period--
                    ``(A) not more than 5 percent of all the amounts 
                appropriated into the Fund available for allocation for 
                any fiscal year shall be available for administrative 
                expenses;
                    ``(B) 75 percent of the remainder (after 
                allocations are made under subparagraph (A) shall be 
                allocated in direct grants to public television 
                stations for the provision of public television 
                broadcasting; and
                    ``(C) 25 percent of such remainder shall be 
                allocated in direct grants to public radio stations for 
                the provision of public radio broadcasting.
            ``(3) Conditions on allocations permitted.--The Corporation 
        shall have the authority to establish requirements, guidelines, 
        and limitations with respect to the use of Federal funds by 
        public broadcasting stations.
            ``(4) Public accountability of recipients.--During the 
        transition period, funds may not be distributed pursuant to 
        this subsection to the Public Broadcasting Service or National 
        Public Radio (or any successor organization), or to the 
        licensee or permittee of any public broadcast station, unless 
        the governing body of any such organization, any committee of 
        such governing body, or any advisory body of any such 
        organization, holds open meetings preceded by reasonable notice 
        to the public. All persons shall be permitted to attend any 
        meeting of the board, or of any such committee or body, and no 
        person shall be required, as a condition to attendance at any 
        such meeting, to register such person's name or to provide any 
        other information. Nothing contained in this paragraph shall be 
        construed to prevent any such board, committee, or body from 
        holding closed sessions to consider matters relating to 
        individual employees, proprietary information, litigation and 
        other matters requiring the confidential advice of counsel, 
        commercial or financial information obtained from a person on a 
        privileged or confidential basis, or the purchase of property 
        or services whenever the premature exposure of such purchase 
        would compromise the business interests of any such 
        organization. If any such meeting is closed pursuant to the 
        provisions of this paragraph, the organization involved shall 
        thereafter (within a reasonable period of time) make available 
        to the public a written statement containing an explanation of 
        the reasons for closing the meeting.
            ``(5) Public access to reports.--During the transition 
        period, funds may not be distributed pursuant to this 
        subsection to any public telecommunications entity that does 
        not maintain for public examination copies of the annual 
        financial and audit reports, or other information regarding 
        finances, submitted to the Corporation.
            ``(6) One-station-to-a-market support.--During the 
        transition period, the Corporation shall ensure that--
                    ``(A) in communities in which there is a 
                substantial overlap in the service areas of public 
                television stations, the total funds made available to 
                those stations are not more than would be provided if 
                such areas were served by a single station; and
                    ``(B) in communities in which there is a 
                substantial overlap in the service areas of public 
                radio station, the total funds made available to those 
                stations are not more than would be provided if such 
                areas were served by a single station, unless such 
                stations serve significantly different listening 
                audiences, using distinct formats and providing a high 
                proportion of locally originated programming.
            ``(7) Rates of pay.--During the transition period, funds 
        may not be distributed pursuant to this subsection to the 
        Public Broadcasting Service or National Public Radio (or any 
        successor organization) unless assurances are provided to the 
        Corporation that no officer or employee of the Public 
        Broadcasting Service or National Public Radio (or any successor 
        organization), as the case may be, will be compensated at an 
        annual rate of pay which exceeds the rate of basic pay in 
        effect from time to time for level I of the Executive Schedule 
        under section 5312 of title 5, United States Code, and unless 
        further assurances are provided to the Corporation that no 
        officer or employee of such an entity will be loaned money by 
        that entity on an interest-free basis.
            ``(8)  Satellite interconnection fund.--
                    ``(A) There is hereby established in the Treasury a 
                fund which shall be known as the Public Broadcasting 
                Satellite Interconnection Fund (hereinafter in this 
                subsection referred to as the `Satellite 
                Interconnection Fund'), to be administered by the 
                Secretary of the Treasury.
                    ``(B) By December 31, 1996, the Public Broadcasting 
                Service and National Public Radio shall prepare a final 
                report for Congress on the status of the Satellite 
                Interconnection Fund.
            ``(9) Post-transition discretion.--The provisions of this 
        subsection shall cease to be effective upon the expiration of 
        the transition period. Thereafter, the Corporation may make 
        funding and financing decisions, and place requirements on 
        licensees, permittees and other public broadcasting entities, 
        in the exercise of its business judgment in consultation with 
        public television and radio licensees.''.

   TITLE II--PRIVATIZATION OF THE CORPORATION FOR PUBLIC BROADCASTING

SEC. 201. CONVERSION OF CORPORATION.

    (a) Conversion of Board to Private Appointment Procedures.--Section 
396(c) of the Communications Act of 1934 is amended to read as follows:

                          ``Board of Directors

    ``(c)(1) The Corporation for Public Broadcasting shall have a Board 
of Directors (hereinafter in this section referred to as the `Board'). 
Until the expiration of the transition period, the Board shall consist 
of 9 members appointed by the President, no more than 6 of whom may be 
members of the same political party.
    ``(2) Members of the Board appointed after the date of enactment of 
the Public Broadcasting Self-Sufficiency Act shall be selected by the 
President from a list of candidates nominated by the selection 
committee convened under paragraph (3). The President may request the 
selection committee to nominate additional candidates. Such candidates 
shall be selected by the selection committee and the President on the 
basis of their qualifications and expertise in one or more of the 
following fields:
            ``(A) Investment management.
            ``(B) Corporate finance.
            ``(C) Telecommunications.
            ``(D) Education.
            ``(E) Public broadcasting.
    ``(3) Upon the occurrence of any vacancy in the Board prior to the 
expiration of the transition period, a selection committee is 
established to nominate candidates for such vacancy. The selection 
committee shall be composed of the majority and minority leaders of the 
Senate and the Speaker and minority leader of the House of 
Representatives. The selection committee shall consult with 
representatives of public broadcast station licensee prior to 
nominating any candidates.
    ``(4) After the expiration of the transition period, members of the 
Board shall be appointed in accordance with the bylaws of the 
Corporation. The terms of all members appointed pursuant to this 
subsection shall expire upon the expiration of the transition period, 
except as otherwise provided in such bylaws as in effect on that date.
    ``(5) Any vacancy in the Board shall not affect its power.''.
    (e) Termination of Provisions.--Section 396 of such Act is further 
amended by adding at the end the following new subsection:

                      ``Termination of Provisions

    ``(n) Effective at the end of the transition period, the following 
provisions of this section shall cease to be effective: subsections 
(d), (e), (h), (i), (l), and (m).

SEC. 202. ESTABLISHMENT OF TRUST FOR PUBLIC BROADCASTING.

    (a) Establishment.--Subpart D of part IV of title III of the 
Communications Act of 1934 is amended by inserting after section 396 
(47 U.S.C. 396) the following new section:

``SEC. 396A. TRUST FOR PUBLIC BROADCASTING.

    ``(a) Purpose.--It is the purpose of this section--
            ``(1) to provide for the establishment of a trust fund by 
        the Corporation to provide ongoing support for public 
        broadcasting after the cessation of annual appropriations under 
        section 396(k);
            ``(2) to prohibit expenditures from the corpus of such 
        trust fund; and
            ``(3) to authorize the appropriations to the trust fund of 
        the proceeds of certain competitive bidding procedures, to form 
        the corpus of the trust fund.
    ``(b) Requirements.--The Corporation shall, in accordance with the 
laws of the District of Columbia, establish a trust fund for the 
investment and management of funds made available under this section. 
The instruments governing such trust fund shall provide--
            ``(1) that no part of the trust fund corpus may be expended 
        for the operations of the Corporation or otherwise in 
        furtherance of the purposes of the Corporation;
            ``(2) such trust fund corpus shall be invested in such 
        manner as the Board of the Corporation determines to be 
        reasonable and prudent; and
            ``(3) the trust fund income shall be available in 
        accordance with the bylaws of the Corporation--
                    ``(A) to carry out the purposes of section 396;
                    ``(B) to pay the operational and administrative 
                expenses of the Corporation;
                    ``(C) to pay for public broadcasting system 
                support; and
                    ``(D) to provide direct grants to public 
                broadcasting stations.
    ``(c) Allocation Requirements.--
            ``(1) One-station-to-a-market support.--The Corporation 
        shall ensure that--
                    ``(A) in communities in which there is a 
                substantial overlap in the service areas of public 
                television stations, the total funds made available 
                through direct grants to those stations are not more 
                than would be provided if such areas were served by a 
                single station; and
                    ``(B) in communities in which there is a 
                substantial overlap in the service areas of public 
                radio station, the total funds made available through 
                direct grants to those stations are not more than would 
                be provided if such areas were served by a single 
                station, unless such stations serve significantly 
                different listening audiences, using distinct formats 
                and providing a high proportion of locally originated 
                programming.
            ``(2) Use to support program production.--The Corporation 
        may expend up to 25 percent of the income from trust for 
        television and radio program production.
    ``(d) Authority To Auction Vacant Reserved Channels.--
            ``(1) Commission action required.--The Commission shall 
        allocate by means of competitive bidding under section 309(j) 
        the initial licenses and construction permits for the use of 
        such portions of the electromagnetic spectrum as are, on the 
        date of the enactment of the Public Broadcasting Self-
        Sufficiency Act, reserved for noncommercial education 
        television stations and as to which no application has been 
        accepted for filing by the Commission by such date. In 
        addition, the Commission shall allocate by such means licenses 
        and permits for stations relinquished under paragraph (5).
            ``(2) Bidding requirements.--The competitive bidding 
        required by paragraph (1) shall be completed not later than 
        January 1, 1999. In conducting such competitive bidding, the 
        Commission--
                    ``(A) shall, notwithstanding section 309(j)(4)(A), 
                require lump sum payment of all bids;
                    ``(B) shall, notwithstanding section 309(j)(4)(D), 
                not prescribe regulations granting bidding preferences 
                that would reduce receipts from the competitive bidding 
                required by paragraph (1) of this subsection;
                    ``(C) shall, prior to conducting such competitive, 
                make such adjustments to the communities of license of 
                the stations to be allocated as necessary, consistent 
                with the avoidance of harmful interference, to recover 
                for the public the full value of the spectrum resource 
                being made available; and
                    ``(D) shall allocate to winning bidders the same 
                rights to obtain an allocation of spectrum for the 
                provision of advanced television services as is 
                available to any incumbent television broadcast station 
                licensee.
            ``(3) Use of proceeds; bidding contingent on 
        appropriations.--The proceeds of any competitive bidding 
        conducted pursuant to this subsection, not to exceed 
        $1,000,000,000, are authorized to be appropriated to the trust 
        fund established by the Corporation under this section. No 
        competitive bidding may be conducted with respect to the 
        portions of the electromagnetic spectrum described in paragraph 
        (1) unless the proceeds of such bidding are appropriated to 
        such trust fund.
            ``(4) Use of spectrum.--The Commission shall award 
        commercial television broadcast licenses to persons or entities 
        that are successful bidders in the competitive bidding required 
        by paragraph (1).
            ``(5) Authority to compensate relinquishing licensees.--The 
        Commission may enter into agreements with public broadcasting 
        entities for the purpose of making available additional 
        stations for allocation by competitive bidding under paragraph 
        (1). Such agreements may provide that a public broadcasting 
        entity that agrees to relinquish its station license may obtain 
        50 percent of the proceeds of the competitive bidding for the 
        spectrum previously allocated to that station. Any such 
        agreement shall provide that any amounts provided to such 
        entity under this paragraph shall be used to support public 
        broadcasting or education.
    ``(e) Compliance Verification.--Before making any funds 
appropriated under subsection (d)(3) available to the Corporation, the 
Secretary of the Treasury--
            ``(1) shall verify that the Corporation has established the 
        trust fund in accordance with the requirements of this section;
            ``(2) shall require the Corporation to agree that, in the 
        event of a substantial failure by the Corporation to carry out 
        the purposes of section 396, the corpus of the trust fund shall 
        revert to the United States;
            ``(3) shall verify that the Corporation has amended its 
        bylaws to provide for the prudent administration of the trust 
        fund by the Corporation after the expiration of the transition 
        period; and
            ``(4) may require such other information or agreements as 
        may be necessary to protect the Federal fiscal interest.
    ``(f) Annual Report.--The Corporation shall submit to the Congress 
an annual statement on the financial condition of the trust fund.''.
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HR 2979 IH----2