[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]



 
      REGULATORY CLASSIFICATION OF LOW-POWER TELEVISION LICENSEES

=======================================================================

                                HEARING

                               before the

                  SUBCOMMITTEE ON TELECOMMUNICATIONS,
                     TRADE, AND CONSUMER PROTECTION

                                 of the

                         COMMITTEE ON COMMERCE
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 13, 1999

                               __________

                           Serial No. 106-21

                               __________

            Printed for the use of the Committee on Commerce

                    ------------------------------  

                    U.S. GOVERNMENT PRINTING OFFICE
56-602 cc                   WASHINGTON : 1999



                         COMMITTEE ON COMMERCE

                     TOM BLILEY, Virginia, Chairman

W.J. ``BILLY'' TAUZIN, Louisiana     JOHN D. DINGELL, Michigan
MICHAEL G. OXLEY, Ohio               HENRY A. WAXMAN, California
MICHAEL BILIRAKIS, Florida           EDWARD J. MARKEY, Massachusetts
JOE BARTON, Texas                    RALPH M. HALL, Texas
FRED UPTON, Michigan                 RICK BOUCHER, Virginia
CLIFF STEARNS, Florida               EDOLPHUS TOWNS, New York
PAUL E. GILLMOR, Ohio                FRANK PALLONE, Jr., New Jersey
  Vice Chairman                      SHERROD BROWN, Ohio
JAMES C. GREENWOOD, Pennsylvania     BART GORDON, Tennessee
CHRISTOPHER COX, California          PETER DEUTSCH, Florida
NATHAN DEAL, Georgia                 BOBBY L. RUSH, Illinois
STEVE LARGENT, Oklahoma              ANNA G. ESHOO, California
RICHARD BURR, North Carolina         RON KLINK, Pennsylvania
BRIAN P. BILBRAY, California         BART STUPAK, Michigan
ED WHITFIELD, Kentucky               ELIOT L. ENGEL, New York
GREG GANSKE, Iowa                    THOMAS C. SAWYER, Ohio
CHARLIE NORWOOD, Georgia             ALBERT R. WYNN, Maryland
TOM A. COBURN, Oklahoma              GENE GREEN, Texas
RICK LAZIO, New York                 KAREN McCARTHY, Missouri
BARBARA CUBIN, Wyoming               TED STRICKLAND, Ohio
JAMES E. ROGAN, California           DIANA DeGETTE, Colorado
JOHN SHIMKUS, Illinois               THOMAS M. BARRETT, Wisconsin
HEATHER WILSON, New Mexico           BILL LUTHER, Minnesota
JOHN B. SHADEGG, Arizona             LOIS CAPPS, California
CHARLES W. ``CHIP'' PICKERING, 
Mississippi
VITO FOSSELLA, New York
ROY BLUNT, Missouri
ED BRYANT, Tennessee
ROBERT L. EHRLICH, Jr., Maryland

                   James E. Derderian, Chief of Staff

                   James D. Barnette, General Counsel

      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                 ______

   Subcommittee on Telecommunications, Trade, and Consumer Protection

               W.J. ``BILLY'' TAUZIN, Louisiana, Chairman

MICHAEL G. OXLEY, Ohio,              EDWARD J. MARKEY, Massachusetts
  Vice Chairman                      RICK BOUCHER, Virginia
CLIFF STEARNS, Florida               BART GORDON, Tennessee
PAUL E. GILLMOR, Ohio                BOBBY L. RUSH, Illinois
CHRISTOPHER COX, California          ANNA G. ESHOO, California
NATHAN DEAL, Georgia                 ELIOT L. ENGEL, New York
STEVE LARGENT, Oklahoma              ALBERT R. WYNN, Maryland
BARBARA CUBIN, Wyoming               BILL LUTHER, Minnesota
JAMES E. ROGAN, California           RON KLINK, Pennsylvania
JOHN SHIMKUS, Illinois               THOMAS C. SAWYER, Ohio
HEATHER WILSON, New Mexico           GENE GREEN, Texas
CHARLES W. ``CHIP'' PICKERING,       KAREN McCARTHY, Missouri
Mississippi                          JOHN D. DINGELL, Michigan,
VITO FOSSELLA, New York                (Ex Officio)
ROY BLUNT, Missouri
ROBERT L. EHRLICH, Jr., Maryland
TOM BLILEY, Virginia,
  (Ex Officio)

                                  (ii)


                            C O N T E N T S

                               __________
                                                                   Page

Testimony of:
    Bruno, Ron, General Manager, WBGN-TV.........................    29
    Devault, George E., Jr., President, Holston Valley 
      Broadcasting Corporation...................................    26
    May, James C., Executive Vice President, The National 
      Association of Broadcasters................................    16
    Stamler, Arthur D., General Manager, WAZT-LPTV...............    20
    Stewart, Roy J., Chief, Mass Media Bureau, Federal 
      Communications Commission; accompanied by Keith Larson, 
      Associate Chief, Engineering, Mass Media Bureau............    10
    Sullivan, Michael, Executive Director, Community Broadcasters 
      Association................................................    23
Material submitted for the record by:
    Devault, George E., Jr., President, Holston Valley 
      Broadcasting Corporation, letter dated May 11, 1999, to 
      Hon. W.J. ``Billy'' Tauzin, enclosing material for the 
      record.....................................................    50
    Grossman, Sherwin, President, Community Broadcasters 
      Association, letter dated April 15, 1999, to Hon. Billy 
      Tauzin, enclosing material for the record..................    47
    National Association of Broadcasters, response for the record    49

                                 (iii)




      REGULATORY CLASSIFICATION OF LOW-POWER TELEVISION LICENSEES

                              ----------                              


                        TUESDAY, APRIL 13, 1999

              House of Representatives,    
                         Committee on Commerce,    
                    Subcommittee on Telecommunications,    
                            Trade, and Consumer Protection,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2 p.m., in 
room 2123, Rayburn House Office Building, Hon. W.J. ``Billy'' 
Tauzin (chairman) presiding.
    Members present: Representatives Tauzin, Oxley, Gillmor, 
Deal, Cubin, Rogan, Shimkus, Fossella, Markey, Luther, Klink, 
Sawyer, Green, and McCarthy.
    Also present: Representative Norwood.
    Staff present: Michael O'Rielly, professional staff member; 
Justin Lilley, majority counsel; Andrew W. Levin, minority 
counsel; Peter Filon, minority senior legislative intern, and 
Jon M. Peha, minority legislative fellow.
    Mr. Tauzin. May we please come to order? I am throwing 
rocks today; we have no gavel.
    Today the subcommittee meets to hear testimony on the 
regulatory classification of low-power television licenses. I 
want to thank everyone for moving forward with this hearing on 
such short notice. A vast majority of low-power television 
stations embody the spirit that many of us envisioned when low-
power was officially classified by the FCC, in the early 
1980's. Today low-power television stations operate on unused 
television broadcast spectrum, at the lower power levels to 
bring television service to the American public.
    Low-power stations also operate very similar to full-power 
stations in that they are required to comply with the 
appropriate FCC rules governing broadcast stations. Some 
markets, low-power television is one of the original 
competitors to full-service broadcasters. Competition, of 
course, is a good thing. Competition makes full-power broadcast 
services improve the quality of their product, makes them 
realize that markets are not monolithic, and communities served 
by local television stations are made up of small 
neighborhoods, towns, and cities where people can differ as 
much as their viewpoints. It, literally, signafies a pattern 
that one size doesn't, in fact, fit all. This rosy picture gets 
clouded, however, when the complicated process of converting to 
digital television is thrown into the mix.
    Let me be clear: The members of the subcommittee have 
worked hard over the last decade to provide an opportunity for 
digital television to flourish. I am excited about the 
development of digital television, as I think all the members 
of our committee are. After the long and difficult debates, a 
number of technology battles, we are at the brink of seeing how 
consumers will respond to the services that digital television 
will offer.
    Next month, another FCC deadline will arrive on DTV, and 
many broadcast stations will be required to provide a digital 
signal to their consumers. Most broadcast stations provide 
digital signals. Providing those signals will mean more digital 
programming, which in turn will mean consumers will have a 
reason to purchase digital sets and to invest in the 
technologies that will merge computers with our television 
screens. As Congress, we placed a number of limitations on the 
development of digital television in the Balanced Budget Act of 
1997.
    Congress' effort to bring a balanced budget to the American 
people was historic, and I believe it enhanced the growth of 
our robust economy. Converting over 1,500 full-power stations 
to digital signals will no doubt be a complex task. Larger 
broadcasters contend, and perhaps rightfully so, that creating 
a permanent license for qualified low-power stations may make 
the conversion to digital more difficult. Conversely, low-power 
stations are very concerned, and perhaps rightly so, that their 
ability to provide low-power service will be greatly curtailed 
by the conversion process, as the FCC re-allocates spectrum.
    We need to think and to explore the exact repercussions of 
the conversion process on low-power stations. We should also 
examine whether congressional action is necessary to alter the 
current relationship between low-power and full-power stations, 
so that low-power is not altogether eliminated, as the 
conversion unfolds.
    For instance, it is a fact that low-power licenses are 
secondary, meaning that low-power stations may have to be 
reallocated in the spectrum band. Also, how would this impact 
the market share of existing low-power stations? Because we now 
have to address these issues, I believe that this hearing is 
both well-timed and appropriate.
    While I have become very familiar over the years with 
issues involving low-power stations, I want to thank my good 
friends, Mr. Deal, Mr. Norwood, Mr. Klink, and others, for 
bringing the particulars of their concerns to me over the last 
year. There is no question that a number of the subcommittee 
members care deeply about these issues and want to see an 
environment where low-power stations can continue to operate.
    I recognize that Mr. Norwood and Mr. Klink have introduced 
legislation regarding low-power issues. Their bill would create 
a permanent license for qualified low-power stations. I have 
withheld my views on the bill, partly because, frankly, I think 
we need all need additional information. The hearing starts 
that process of exploring the issues in-depth, so we can all 
have a greater understanding. We need to put these issues on 
the table and begin thinking about how to resolve them, and 
that is, indeed, why we have gathered today, and we intend to 
learn a great deal at this hearing.
    I want to thank the witnesses in advance for their 
testimony. I look forward to hearing from them.
    I yield now to my friend from Massachusetts, the ranking 
minority member. Please welcome Mr. Markey, for your opening 
statement.
    Mr. Markey. Thank you so much, Mr. Chairman, and thank you 
so much for having this very important hearing today.
    The low-power television industry was established by the 
Federal Communications Commission in the early 1980's as a 
secondary broadcast service designed to further the 
telecommunications policy goal of localism. In an era of rapid 
consolidation, and of television broadcast properties at the 
national level, ensuring that local broadcasting remains 
vibrant and competitive is vitally important, and I believe 
that low-power television has a key role in fulfilling that 
policy objective.
    In countless markets across the country, low-powered 
television stations are operated by local schools, religious 
groups, minority organizations, local governments, and 
businesses. Low-power stations serve many rural communities and 
also broadcast at traditionally underserved minority, foreign 
language, and bilingual populations. Moreover, these stations 
meet the need of many communities of providing programming of 
local interests. Whether it is a local high school football 
game or local town meeting, it is often the low-power 
television station that covers the event and broadcasts it to 
the local community.
    As the television broadcast industry undergoes its 
transition to digital television and more spectrum is needed, 
low-power television stations as secondary licensees are at 
risk of being displaced until the transition is over. Without 
question, this committee has a strong interest in ensuring that 
the transition is a success. Given the length of the 
anticipated transition time, however, the practical reality for 
many low-power stations is that, if they are displaced, they 
may be off the air for a significant period of time in some 
markets.
    One suggestion for ensuring that low-power television 
stations are not displaced during the digital transition is to 
put low-power stations on even par with full-power stations. 
This is but one of a number of difficult policy and engineering 
issues posed for the Congress and for the FCC.
    The Commission is always at its best when it takes 
government resources and creatively works to get those 
resources into the marketplace to meet a need. When the 
Commission created low-power television during the Reagan 
administration, it essentially fit those new stations into 
existing markets, working carefully to limit interference to 
the incumbents. Many of those stations are now 
telecommunications policy success stories, and the witnesses we 
have here embodied the best in local, in community-oriented 
broadcasting.
    I would observe, parenthetically, that FCC Chairman Kennard 
has proposed creating a new low-power radio service. Low-power 
radio could also meet an important need for local broadcasting, 
especially, in light of the rapid, and in my view, unhealthy 
consolidation of radio stations at the passage of the 
Telecommunications Act. Clearly, issues of interference need to 
be fully explored and worked out, as was done in creating low-
power television. But I want to applaud the Commission for 
exploring this worthwhile proposal.
    And I want to especially commend the work of our committee 
colleagues, Mr. Norwood, Mr. Klink, and Mr. Deal, and others 
who have recognized the important role that low-power 
broadcasting can play in our communities. And I again commend 
Chairman Tauzin for calling this hearing and I pledge my 
support, my commitment to any process that you may decide is 
best for us to follow.
    Mr. Tauzin. Thank you very much, Mr. Markey, and I am 
pleased now to welcome Mr. Nathan Deal from Georgia for his 
opening statement.
    Mr. Deal. Thank you, Mr. Chairman. I want to join in 
thanking you for holding this important hearing. As you know, 
two-thirds of low-power stations serve rural communities. So 
therefore, it's not unusual that in a rural district, such as 
mine, low-power television is an important service factor. 
Local news is the backbone of these communities, and these low-
power stations provide this service to otherwise unserved 
areas.
    Therefore, I am strongly supportive of these stations, and 
am a co-sponsor of my colleague, Mr. Norwood's bill, the 
Community Broadcasters Protection Act. An excellent example of 
the broadcasting that is provided by such low-power stations is 
North Georgia Television, which is in my district. WDNN is 
carried on five cable systems and reaches approximately 200,000 
viewers. Community news is the centerpiece of their 
programming, which offers information about business, 
education, public affairs, and political coverage. Low-power 
television stations are similar to community newspapers, 
covering stories and events that are often overlooked by larger 
affiliate stations in the market area. These stations are 
important tools in informing local communities, and may often 
be the only local programming channel that is received by 
viewers.
    Qualifying low-power stations, in my opinion, should have 
the same permanent license status as other television stations, 
if they so choose. Therefore, I urge my colleagues, as we 
consider the information provided in this hearing, to look into 
the legislation that is proposed by Mr. Norwood and by Mr. 
Klink.
    Again, Mr. Chairman, I want to thank you for holding this 
important hearing. Thank you.
    Mr. Tauzin. Thank you, Mr. Deal. The Chair is now pleased 
to welcome the gentleman from Minnesota, Mr. Luther, for an 
opening statement. He is not here. The gentleman from 
Pennsylvania, Mr. Klink.
    Mr. Klink. Thank you, Mr. Chairman, for recognizing me, and 
I thank you for holding this hearing today, and I appreciate 
your remarks.
    Before I go on, let me just introduce to you one of the 
witnesses who is here today; somebody that, when I was working 
at KDKA many years ago, first came out of Indiana University of 
Pennsylvania as an intern and today as a broadcaster, my dear 
friend and constituent, Ron Bruno. I welcome Ron for being here 
with us today and look forward to his testimony, as well as I 
do the rest of the witnesses.
    Let me just say, first of all, that I am very much 
concerned about the future of low-power television. As someone 
who has lived in rural areas and as a former broadcaster, I can 
tell my fellow colleagues on the committee how important these 
low-power television stations are to the communities that they 
serve.
    Let me just say that, you know, America has been made great 
because we have people that go into their garages and basements 
and invent things that often start new industries. The low-
power broadcasters today are the inventors; they are the people 
that are going out there changing the face of broadcasting. 
They may be small, but each one of them is an integral part of 
the community that they often serve in. They put up compelling 
programming, with local focus, that very often is not 
available, wouldn't be carried by the other full-powered 
stations--things like high school sports, community civic 
celebrations, local government meetings, foreign language, for 
if you have a Spanish community or a Greek community or a 
Seiren community, they can offer programs in the language of 
those communities.
    In that regard, I view the low-power television stations as 
the centers of innovation, creativity, and community service. 
But the transition to digital television is putting their 
future in jeopardy, which would have, I think, a disastrous 
consequence for the people in the communities in rural areas 
who are dependent upon their local coverage. And that is why 
with my good friend, Mr. Norwood, that with Mr. Deal's support, 
we have introduced H.R. 486, the Community Broadcasters 
Protection Act--to protect qualified low-power stations from 
losing their space on the dial as we transition to digital.
    Mr. Chairman, I do understand that this is an oversight 
hearing; it is not a hearing specifically on our bill. But 
something does need to be done before we lose these stations 
entirely. Our bill simply would give some protection to the 
small mom-and-pop community broadcasters who comply with the 
act.
    Under this bill, stations would only qualify for protection 
if they broadcast 18 hours a day, have 3 hours a week of 
locally produced broadcasting, be in compliance with the FCC 
rules for both low-power and full-power television stations, 
and not interfere with the Grade B contour of other stations. 
The least we can do, Mr. Chairman, is to help these 
broadcasters. Without some form of minimum protection, we can 
well lose this industry that is truly local broadcasting at its 
best.
    Now I yield back my time.
    Mr. Tauzin. I thank the gentleman for your statement. The 
Chair now recognizes the vice chairman of our subcommittee, the 
gentleman from Ohio, Mr. Oxley.
    Mr. Oxley. Thank you, Mr. Chairman, and I applaud the 
decision to hold today's hearing to discuss the low-power 
television industry. As you may know, Mr. Chairman, I am a 
original co-sponsor of the Community Broadcasters Protection 
Act, sponsored by the gentleman from Georgia, Mr. Norwood.
    I support the bill because I have three low-power stations 
in my district that are providing excellent service to my 
constituents, including strong local contact. An example, is 
WOHL TV, the FOX affiliate in Lima, Ohio--that's ``Lima,'' not 
``Leema.''
    WOHL produces about 7 hours of local programming each week, 
including high school sports shows, weather reports, a daily 
news magazine, a show called, ``A View From the Hill'' that 
features interviews with local legislators, political debates, 
Sunday morning church services, and a program called ``In 
Focus.'' ``In Focus'' is a unique project, whereby WOHL is 
partnered with the Lima City and Allen County schools to 
provide technical support to teachers and students for the 
purpose of producing TV segments. These segments are then 
broadcast on WOHL each week.
    Of course, it is common for low-power stations to serve 
rural communities and other underserved populations. I believe 
this is an important service worth preserving.
    My sense is that there is room for low-power television 
alongside full-power, both during and after the conversion to 
digital. However, this is a technical question best answered by 
the experts at the FCC, with the oversight of this committee. 
We all want the transition to DTV to be successful. The 
problem, Mr. Chairman, is that low-power secondary spectrum 
priority means that there is always an element of doubt as to 
their continued viability. Needless to say, this creates great 
difficulty in raising capital and making needed investments. 
Hopefully, this hearing is the first step in establishing 
greater stability for these stations, so they can continue to 
grow and serve their communities.
    Thank you Mr. Chairman, I yield back to balance my time.
    Mr. Tauzin. Thank you, my friend. The Chair is now pleased 
to recognize another gentleman from Ohio, Mr. Sawyer, for an 
opening statement.
    Mr. Sawyer. Thank you, Mr. Chairman. I have a longer 
statement that I have prepared for the record; I don't intend 
to read it.
    I would observe that in the greater Akron area, a community 
of some 600,000 to 700,000 people, we may be the largest 
community of our size anywhere in the industrial Midwest not to 
have a broadcast affiliate of any kind. We did up until 
recently, and the vacuum that has been lost in terms of local 
news coverage has been severely felt. I can fully appreciate, 
therefore, the sensitivities of those who are today being 
served well by low-power stations and the important role that 
they fulfill within their communities.
    We have one low-power station in my community, it is 
largely a source of entertainment and advertising and probably 
does not fulfill the kind of role that many of you have brought 
to the communities that you serve.
    In that sense, I will be interested in the course of this 
hearing and in the unfolding of this issue, to get a sense of 
what kind of criteria, in addition to those that Congressman 
Klink mentioned in his testimony, his opening statement, what 
kind of criteria you would foresee as being appropriate for 
low-power stations to receive a Class A designation or whether 
it would simply be all. A question of whether the FCC can or 
should do this through the regulatory structure or whether we 
have an appropriate role that ought to be done through 
legislation. And finally, how this legislation would affect 
full-power stations' obligations in high-definition television 
and programming in general.
    With that, Mr. Chairman, I will submit my statement for the 
record and thank you for your time today.
    [The prepared statements of Hon. Thomas C. Sawyer and Hon. 
Richard Burr follow:]
   Prepared Statement of Hon. Thomas C. Sawyer, a Representative in 
                    Congress from the State of Ohio
    Mr. Chairman, I want to thank you and Mr. Markey for holding this 
hearing this afternoon. I also want to thank our witnesses for coming 
to testify before us.
    Mr. Chairman, I represent what may be the only city of its size in 
the industrial midwest that does not have a major local broadcast 
affiliate located within its own metropolitan area. Up until a few 
years ago, we had an ABC affiliate. However, that station was bought 
out and turned into a Home Shopping Network channel which provides 
family programming, but not local news. And while the broadcasting 
affiliates from Cleveland try to provide my constituents with their 
local news and broadcast programming, it is not the same. When this 
subcommittee held its first reauthorization hearing this year on the 
Satellite Home Viewer Act a few weeks ago I made this same point. I 
make this statement again today because I believe it has some relevance 
to the topic we are about to discuss.
    In the early 1980s, the FCC created low-power television to allow 
small independent broadcasters who wanted to fill a void within in 
their community with an opportunity to deliver local programming and 
community news. These station operators were given their secondary 
license with the understanding that their broadcasts could not 
interfere with full power stations. There was also the understanding 
that the FCC could revoke their broadcast license at any time and use 
their allocated spectrum for other purposes.
    Three years ago, we passed legislation that required the broadcast 
industry to begin delivering their programming in high definition by 
2002 and that the broadcasters be given additional spectrum to convert 
to digital. After the conversion has been completed, the broadcasters 
must return their analog spectrum to the federal government. However, 
low-power television stations, who were given secondary or 
``temporary'' broadcasting licenses, may be at risk of being put out of 
business if their spectrum is used by full power stations.
    Today we will hear testimony on the effects digital conversion will 
have on low-power broadcast stations and on H.R. 486, the Community 
Broadcaster Protection Act, which has been introduced by Congressman 
Norwood and Congressman Klink. Their legislation would essentially 
elevate low-power television stations to full-power station status by 
providing them with Class A status. I also understand that there is a 
petition before the FCC that would provide relief to low-power 
television stations by granting low-power stations Class A status 
through the regulatory process.
    Given the current situation in my congressional district, providing 
Class A status to low-power television stations may be a good idea. 
However, there are a few questions I would like to have answered before 
I come to any conclusion.

 First, there are currently about 2100 low-power television 
        stations operating in the United States. What type of criteria 
        will be used to determine which low-power television stations 
        receive the new Class A designation or will all of them be 
        granted the license?
 Second, if the FCC is deliberating over the petition before it 
        in this area, is congressional action truly needed or does the 
        FCC have the regulatory authority to find a solution to this 
        problem?
 Finally, I want to know the effects this action will have on 
        the full power stations' abilities to meet their obligations 
        with respect to high definition television and their future 
        programming abilities.
    Mr. Chairman, I hope our panelists will be able to answer these 
questions. Again, thank you for calling this hearing today.
                                 ______
                                 
 Prepared Statement of Hon. Richard Burr, a Representative in Congress 
                    from the State of North Carolina
    Mr. Chairman, I want to thank you for allowing me the opportunity 
to address your Subcommittee today. The issue under discussion is of 
vital importance to rural communities not only in my district, but 
across the nation as well. These communities rely on low-power 
television stations to broadcast important news and community 
information that would otherwise be ignored by the larger high-power 
stations. Unfortunately, because their licenses are considered 
``secondary'' or temporary, low-power stations top the list of 
licensees who will lose their frequency when spectrum reallocations 
become necessary. While some of these stations receive new channels, 
many simply go dark.
    When a low-power station is forced to stop broadcasting, the 
effects are felt throughout the community. Without the low-power 
stations in my district, many local charities and non-profit 
organizations would not benefit from the hours of air time allocated 
for fund raising. Residents of these communities would miss out on many 
minority syndicated programs not carried by high-powered stations. They 
could not see the Carolina Hurricanes National Hockey League games or 
watch their children participate in the state high school football and 
basketball championships. Finally, because these stations are locally 
owned and operated, they provide many economic benefits to the 
communities they serve.
    In order to allow low-power television stations to continue serving 
their communities, I encourage the members of the Subcommittee to look 
favorably on legislation similar to the Community Broadcasters 
Protection Act. As you know, this important bill would create a 
permanent ``Class A'' license for low-power stations, thus removing the 
constant threat of spectrum reallocation while insuring that the 
stations remain committed to serving their communities. This type of 
license is not new to us. It has worked quite well for low-power FM 
radio stations, and I strongly believe that a similar license will work 
just as well for television. Without this protection, many communities 
may not only lose a valuable source of community news and information, 
but an important member of the community as well.
    I commend Mr. Norwood for introducing this bill. He continues to be 
a strong champion for low-power stations, and I look forward to working 
with him, the members of this Subcommittee, and my colleagues on the 
full Commerce Committee on this important legislation. Again, Mr. 
Chairman, I want to thank you for holding this hearing and for the 
opportunity to address you today.

    Mr. Tauzin. I thank the gentlemen.
    Without objection, any written statements members wish to 
submit will be accepted into the record.
    The Chair is now pleased to recognize another gentleman 
from Ohio, the vice chairman of the full Commerce Committee, 
Mr. Paul Gillmor, for an opening statement.
    Mr. Gillmor. Thank you very much, Mr. Chairman. I waive an 
opening statement.
    Mr. Tauzin. I really thank the gentleman from Ohio.
    The Chair now recognizes the gentlelady from Missouri, Ms. 
McCarthy, for an opening statement.
    Ms. McCarthy. Thank you very much, Mr. Chairman, and thank 
you for having this hearing.
    I won't repeat what Mr. Markey and others have said about 
the importance of low-power stations; they are key to my 
district in educating the public and serving communities which 
would otherwise not be served. So I thank each of the panelist 
today for being here. It is very important.
    Mr. Chairman, I think, as we advance equitably into the 
digital age, we need to be sure that low-power television 
stations remain in the market. I would hope this committee, as 
we look at legislation to improve, would include language to 
require the FCC to conduct a study to determine the actual 
amount of spectrum available, and the idea of just relying on 
sort of theoretical and abstract numbers is of concern to me. I 
think we need to request that, and I hope that we would 
consider that in any discussion that we have on the 
legislation.
    And I will submit my entire statement for the record.
    Mr. Tauzin. I thank the gentlelady. The Chair recognizes 
the gentleman from California, Mr. Rogan, for an opening 
statement.
    Mr. Rogan. Mr. Chairman, thank you. Very briefly, I just 
want to simply thank the Chair for calling this hearing.
    As we transition from analog to digital television signals, 
there are a number of issues we are going to have to address 
here in Congress dealing with both equity as well as service. 
This hearing will be a big help to all of us, as we wind our 
way through the legislative process. I thank the Chair for 
calling this hearing. I yield back the balance of my time.
    Mr. Tauzin. Mr. Shimkus.
    Mr. Shimkus. I am anxious to hear from our panel of 
experts, so that is all I have to say, Mr. Chairman.
    Mr. Tauzin. Mrs. Cubin. Is she still here? I think we have 
gone through our panel.
    Let me thank the members for their opening statements and, 
again, remind everyone that, if you wish to submit a written 
statement, it will be part of the record.
    [Additional statement submitted for the record follows:]
 Prepared Statement of Hon. Tom Bliley, Chairman, Committee on Commerce
    I thank Chairman Tauzin for calling this hearing. Some people had 
argued in the waning days of the last Congress that we should take 
action on this issue in relation to other legislative issues that were 
being considered at the time.
    The Committee was concerned that there was not a substantial enough 
record to justify such action. As I always prefer regular order when at 
all possible, I am glad that Chairman Tauzin is turning to this issue 
early in the session.
    The story of low power television is a unique one. Of the large 
number of low power stations, no one is quite sure which are viable 
stations and which ones are stations in name only. I have been told 
that there may be upwards of 700 legitimate stations out there 
providing service. That leaves a large portion of the over 2000 low 
power stations that may be nothing more than paper that is filed at the 
FCC. This is not too surprising given the minimal regulations designed 
to allow low power to flourish.
    In some rural markets--as we have learned all too well in the 
debate over the Satellite Home Viewer Act reform effort--local full 
power television signals are not available to consumers. In many of 
these markets low power television can be the only access to local news 
and weather. In some other instances, low power stations provide unique 
programming to serve the unique interests of consumers.
    Currently, the regulatory classification puts low power television 
as a secondary spectrum priority. For those consumers that rely on low 
power stations for their local news during a miserable snow storm, 
school closing or whatever there is no secondary status about it. It is 
clear that in some communities low power stations provide a valuable 
service to consumers.
    And a hearing on low power television would be interesting in and 
of itself if the entire broadcasting industry was not making the 
conversion to digital television. The digital conversion plan is going 
to require the broadcasting industry to harness all of its resources. 
Along with this comes the question, what happens to low power 
television stations during and after the conversion.
    I want to congratulate the competitive, entrepreneurial spirit of 
the low power community. Many of the low power stations are family run 
stations that operate on shoe-string budgets in order to bring service 
to a community. Mr. Stamler points out in his testimony that he and his 
wife went three years without a paycheck and that their ultimate, 
original investors were the local dairyman, the farm implement dealer, 
and a retired federal employee, a physician, an accountant and others.
    This history reminds me of the stories we hear about the personal 
computer revolution, and the recent development of the Internet and 
electronic commerce. These are real American entrepreneurs.
    Some say, however, that low power television stations have always 
been on notice that their service could be impeded or discontinued at a 
moment's notice. They have been well aware of the rules of the road. 
Thus, the difficulties with the transition to digital television should 
be no surprise.
    The purpose of this hearing is to hear more about the impact of the 
FCC's conversion plan, how it will impact full power television 
stations, how it will impact low power stations and whether the 
regulatory classification of low power licenses is appropriate in a 
digital environment.
    I trust this will be an informative debate so that Members can 
fully understand the differing perspectives on this important issue.
    I thank the Chairman again for holding this hearing.

    Mr. Tauzin. I am now pleased to welcome our panel. Let me, 
first of all, apologize to our panel, as we may have some 
disruptions in the hearing today. I understand the Democrats 
will have a briefing on Kosovo at 3 p.m. So we will get as far 
as we can, as rapidly as we can. And we will also have a 
briefing later on, I think, this afternoon. So we are going to 
try to wrap as fast as we can.
    In that regard, we are going to use the 5-minute rule, 
which means that I will switch you on. The green light is not 
working, but the red light is. So when the red light comes on, 
that means your 5 minutes are up, and if you kind of wrap when 
you see that red light hitting.
    Let me thank you all for coming. We will start, please, 
with Mr. Stewart. Roy Stewart, the Chief of Mass Media Bureau 
of the FCC, for your statement, Mr. Stewart.
    All of your written statements are part of our record; we 
have them. If you would summarize and give us the highlights of 
your testimony? Mr. Stewart.

STATEMENTS OF ROY J. STEWART, CHIEF, MASS MEDIA BUREAU, FEDERAL 
    COMMUNICATIONS COMMISSION; ACCOMPANIED BY KEITH LARSON, 
ASSOCIATE CHIEF, ENGINEERING, MASS MEDIA BUREAU; JAMES C. MAY, 
     EXECUTIVE VICE PRESIDENT, THE NATIONAL ASSOCIATION OF 
 BROADCASTERS; ARTHUR D. STAMLER, GENERAL MANAGER, WAZT-LPTV; 
 MICHAEL SULLIVAN, EXECUTIVE DIRECTOR, COMMUNITY BROADCASTERS 
ASSOCIATION; GEORGE E. DEVAULT, JR., PRESIDENT, HOLSTON VALLEY 
BROADCASTING CORPORATION, AND RON BRUNO, GENERAL MANAGER, WBGN-
                               TV

    Mr. Stewart. Mr. Chairman, ranking members, and members of 
the subcommittee, good afternoon, I am Roy Stewart, Chief of 
the Mass Media Bureau of the Federal Communications Commission. 
Accompanying me today is Keith Larson, Associate Chief for 
Engineering of the Mass Media Bureau.
    I welcome this opportunity to discuss low-power television 
and legislation intended to protect community broadcasting 
stations, that provide beneficial local programming to their 
communities. The Commission's Chairman, William Kennard, has 
submitted a statement for the record to the subcommittee, in 
which he expresses his strong support for Class A status for 
qualifying low-power television stations.
    Low-power television stations operate on the same channels 
as full-service broadcasters, but do so at much lower power 
levels. Because low-power stations are secondary, they are 
subject to displacement at any time by primary full-service 
television stations. Despite their secondary status, many low-
power stations have become important sources of local 
programming in their communities; providing local news, 
weather, community affairs, local election, and sporting event 
coverage, as well as programming directed to unserved and 
underserved audiences. Indeed, many low-power stations may be 
the only television outlet in their community.
    The LPTV service has also increased the diversity of 
broadcast station ownership. Station operators include such 
varied entities as schools, colleges, churches, local 
governments, community groups, and radio and television 
broadcasters. And the service has provided first-time ownership 
opportunities to minority groups, women, and a range of small 
businesses.
    The Commission has long recognized the value of low-power 
television service and has extended considerable effort over 
the years to promote and protect it. At the outset of the 
service, I was the Chief of the Video Services Division in the 
Mass Media Bureau. I well remember the flood of applications 
that overwhelmed our ability to process and dispose of them. We 
turned to Congress for help, and obtained staffing and computer 
resources, as well as statutory changes that greatly 
streamlined our processing methods.
    This assistance enabled us to implement the service, and 
today there are some 2,100 licensed LPTV stations. Although 
secondary, low-power stations have, until the recent 
introduction of the DTV service, largely managed to avoid 
displacement by full-service broadcast stations. As the DTV 
transition begins in earnest, however, the Commission has 
acknowledged that there is insufficient spectrum to protect 
existing low-power television stations and provide a second 
channel for digital service to more than the 1,600 existing 
full-power television stations. Working with the LPTV industry, 
the Commission has taken numerous steps to mitigate the impact 
on low-power television stations, including relaxing certain 
interference standards, permitting immediate displacement 
relief applications to be filed, and modifying more than 60 DTV 
allotments to eliminate conflicts with LPTV service. But even 
with these measures, many low-power television stations are 
still subject to being displaced, including stations that have 
made significant contributions to their local communities.
    The bill before the subcommittee, the Community 
Broadcasters Protection Act of 1999, addresses many of the 
problems now faced by low-power television stations as a result 
of their secondary status. It is very similar in scope and 
intent to a petition for rulemaking filed with the Commission 
by the Community Broadcasters Association. The legislation 
proposes to create a new Class A television service that would 
enjoy primary status and would not, therefore, be subject to 
displacement. The bill and its objective of providing a measure 
of permanence and protection for the many low-power television 
stations that contribute significantly to their local 
communities, is both timely and commendable. This protected 
status is critical if we are to preserve these valuable outlets 
for diverse and uniquely local programming.
    The bill seeks to craft eligibility and procedural 
provisions to establish Class A service in a manner that does 
not unduly disrupt existing television service, or the 
transition to digital television. Let me turn to three 
particular provisions of the bill that may warrant further 
examination by the subcommittee. Okay.
    First, the contour protection provisions of the act, which 
gives eligibility to Class A stations during dependency of any 
rulemaking that we had to do. While this approach would give 
early protection to Class A stations, it could also preclude us 
from being able to authorize new full-power television analog 
stations. That may limit our flexibility to make necessary 
adjustments to the technical parameters of the DTV stations 
operating pursuant to our DTV table of allotments.
    The second aspect deals with the requirement that we do not 
have a bidding mechanism to deal with competing Class A station 
applications, or translators. It would require us not to be 
able to use what came out of the Balanced Budget Amendment--
competitive bidding process. And we would have to sit there and 
try to figure out what comparative criteria to use. I think we 
can agree, that we have had a problem, as a Commission, trying 
to figure out comparative criteria for competing applications.
    And the third part deals with the fact that there are no 
ownership restrictions on the Class A stations. But yet, the 
bill appears to contemplate that Class A stations would enjoy 
primary status. Then it should be subject to most of the 
Commission's full-service obligations. I have asked that the 
subcommittee may wish to consider whether full-service 
ownership rules should apply.
    And, finally, if I may, Mr. Chairman, I want to close by 
re-stating Chairman Kennard's unequivocal commitment to 
creating a Class A low-power television service. He firmly 
believes that affording qualifying low-power television 
stations with substantial and enduring protections, consistent 
with the needs of a digital television transition, will serve 
the public interest.
    Thank you, Mr. Chairman, for the opportunity to appear 
before you, and I am prepared to answer any questions.
    [The prepared statement of Roy J. Stewart follows:]
Prepared Statement of Roy J. Stewart, Chief, Mass Media Bureau, Federal 
                       Communications Commission
I. Introduction
    Mr. Chairman, Ranking Member, and Members of the Subcommittee: Good 
afternoon. I am Roy Stewart, Chief of the Mass Media Bureau at the 
Federal Communications Commission. Accompanying me today is Keith 
Larson, Associate Chief for Engineering of the Mass Media Bureau. I 
welcome this opportunity to discuss low power television community 
broadcasting and legislation intended to protect community broadcasting 
stations that provide beneficial local service to their communities.\1\ 
As you know, FCC Chairman William E. Kennard has submitted a statement 
for the record in which he expresses his strong support for Class A 
status for qualifying low power television stations.
---------------------------------------------------------------------------
    \1\ The comments and views expressed in this Statement are offered 
in my capacity as Chief of the Commission's Mass Media Bureau and may 
not necessarily represent the views of individual FCC Commissioners.
---------------------------------------------------------------------------
II. Low Power Television History
    Low power television (LPTV) stations are broadcast stations that 
operate on the standard VHF and UHF television channels, but at much 
lower power levels than conventional TV stations. LPTV stations may 
retransmit programming received from other sources or originate their 
own programming. LPTV stations have a ``secondary'' frequency use 
status in that they may not interfere with, and must accept 
interference from, conventional ``primary'' TV stations.
    The Federal Communications Commission created the Low Power 
Television Service in 1982. The FCC believed that LPTV stations could 
increase television programming diversity in both urban and rural areas 
and that these stations would be particularly well suited to provide 
local programming.
    The LPTV service has overcome many obstacles in its brief history. 
Its early growth was impeded by the FCC's difficulty in processing the 
tens of thousands of applications which had rapidly accumulated, nearly 
all of which were mutually exclusive with many other applications. 
Congress appropriated funds for computers and additional staffing to 
help the FCC meet its LPTV processing challenge. It also enacted 
legislation to enable LPTV licenses to be awarded by random selection 
(lottery), rather than through the hearing process adopted in the LPTV 
rulemaking proceeding. In 1984, facing a backlog of more than 30,000 
applications, the FCC froze application filings for new LPTV stations. 
The filing freeze continued for more than 3 years, during which the FCC 
solved the processing problems and accelerated the pace of authorizing 
LPTV stations. By 1986, about 150 LPTV stations were operating. The 
early LPTV stations had considerable difficulty obtaining programming 
and funding from conventional sources. Yet, the service continued to 
grow. By 1989, 500 LPTV stations were licensed to operate in the lower 
48 states, and by 1993, the number of licensed stations had grown to 
1,000. Another 250 LPTV stations operated in Alaska.
III. The LPTV Service Today
    There are currently more than 2,100 licensed LPTV stations. LPTV 
stations operate in more than 1,000 communities of all sizes and in all 
50 states. The LPTV service has increased the diversity of broadcast 
station ownership; station operators include such diverse entities as 
schools, colleges, churches, local governments, community groups and 
radio and TV broadcasters. The service has also provided first-time 
ownership opportunities to minority groups, women and a variety of 
small businesses. LPTV stations can be operated in a wide variety of 
ways. FCC rules do not require minimum hours of station operation or 
minimum amounts of locally produced programming. Some stations 
primarily retransmit programming imported from full-service television 
stations, satellites or other sources. Others focus on program 
production. The hallmark of the LPTV service has been locally oriented 
programming. LPTV stations also often provide programming to unserved 
or underserved audiences, including ``niche'' programming tailored to 
audiences with specific interests. Many LPTV stations serve as a 
community's only local television station and provide coverage of local 
news, weather, community affairs, local elections and events such as 
high school football games.
IV. Digital Television Impact on LPTV
    Despite their secondary status, until the arrival of the digital 
television era, few LPTV stations had been displaced by primary 
television stations. The Commission received very few complaints of 
interference from LPTV stations to analog TV reception. Where 
interference occurred, the affected stations were usually able to find 
a suitable replacement channel on which to operate using an FCC 
``displacement relief'' provision. That provision permits stations with 
an interference conflict to seek replacement channels at any time on a 
noncompetitive, ``first-come'' basis. Thus, the disruption of LPTV 
service during the analog television era has been minimal.
    The prospects for LPTV service disruption, however, have been 
markedly increased by the emergence of the digital television (DTV) 
service. The FCC concluded in its DTV proceeding that there was 
insufficient spectrum to protect the existing service of secondary LPTV 
stations and to provide a second channel for DTV service to more than 
1,600 full-service stations. It also concluded that LPTV stations would 
remain secondary to, and must not interfere with, DTV service. The 
Commission, however, provided several measures intended to mitigate the 
impact of the transition to DTV on LPTV service. The channel 
displacement relief provisions were extended to stations potentially 
affected by DTV stations or channel allotments. Applications for 
replacement channels were accorded the highest priority among 
applications in the LPTV service.
    Several of the interference protection rules imposed on LPTV were 
found to be overly protective and were either eliminated or made less 
restrictive. LPTV stations were afforded additional operating 
flexibility and permitted to negotiate interference agreements with 
other stations in the LPTV service. The Commission also expanded its 
policy of granting waivers of the interference rules based on 
consideration of terrain shielding. It increased the maximum power 
limits in the LPTV service, primarily to enable LPTV stations to 
operate on channels adjacent to those of full power stations operating 
at the same location. Finally, the Commission modified more than 60 DTV 
allotments to eliminate conflicts with one or more LPTV stations.
    Despite all of these measures, the DTV transition is expected to 
have a significant, adverse impact on many LPTV stations, particularly 
those stations in urban areas. As an indication of the extent of 
potential displacement, in June 1998 the Commission received more than 
1,000 ``displacement relief'' applications from stations in the LPTV 
service, seeking operations on different channels. More than 400 of 
these applications have been granted; many others are mutually 
exclusive and, as the law now stands, these LPTV operators will be 
required to bid against each other to obtain one of the limited number 
of available replacement channels.
V. The Rule Making Petition of the Community Broadcasters Association
    The FCC has received and is now considering a rulemaking proposal 
submitted by the Community Broadcasters Association (CBA), an 
association of LPTV station operators. CBA's petition asks the FCC to 
amend its rules to provide additional protections for a limited class 
of LPTV stations. CBA proposes that the FCC create a Class A television 
service for qualifying LPTV stations. LPTV licensees would qualify for 
Class A status by demonstrating that for the three month period prior 
to submission of their applications their stations complied with the 
minimum operating schedule for TV broadcast stations and broadcast not 
less than 3 hours in each calendar week of locally produced 
programming. Applicants would also be required to certify that as of 
the application filing date, their station operations complied with 
most rules applicable to full power TV stations, generally excepting 
only those rules governing their initial authorization and station 
power. Applications for Class A status would have to be filed within 
one year of completion of the FCC rulemaking proceeding.
    As proposed by the CBA, applicants would be required to demonstrate 
that their stations would not cause interference within the Grade B 
contour of analog TV service authorized as of the filing date of the 
Class A application. They would also be required to show that 
interference would not be caused within DTV service areas resulting 
from the technical parameters in the FCC's DTV Table of Allotments. 
Applicants would also have to demonstrate that interference would not 
be caused within the protected areas of authorized LPTV and TV 
translator stations (translator stations rebroadcast the programs of 
primary TV stations). Class A stations would be protected against 
interference within their LPTV service areas by subsequently filed 
analog TV and DTV service application proposals (other than proposed 
DTV facilities consistent with a station's DTV allotment parameters). 
The CBA also proposes higher power levels for Class A stations and that 
such stations be entitled to convert to digital operation on their 
channel or seek a second channel for digital operation, provided 
interference protection requirements are met.
VI. The Community Broadcasters Protection Act of 1999
    The bill before you H.R. 486, the Community Broadcasters Protection 
Act of 1999, would help preserve those low power TV stations that have 
served the public interest by providing a local broadcast TV service to 
their communities. As I described earlier, the Federal Communications 
Commission has long sought to nurture the low power TV service, 
recognizing the significant contributions it can make to local 
communities. I firmly support the objectives of the proposed 
legislation as a means of protecting those low power stations that have 
made such contributions to their communities. By affording these 
stations Class A, protected status, these local community broadcasters 
can continue providing the local programming that makes them so special 
to their communities. It will provide these stations the certainty they 
need as we enter the digital age.
    In pursuing this objective, the proposed legislation seeks to craft 
eligibility and procedural provisions to establish Class A service in a 
manner that does not unduly disrupt existing television service or the 
transition to DTV. Let me turn to three particular provisions of the 
bill that may warrant further examination by the Subcommittee.
    First, the legislation provides that the FCC grant ``certification 
of eligibility'' during the pendency of its rulemaking proceeding to 
prescribe regulations to establish a Class A service and that the 
contours of LPTV licensees must be preserved until the related Class A 
applications have been resolved. These provisions appear to direct the 
FCC to protect the existing service contour of an LPTV station once it 
certifies the station licensee to be eligible to apply for Class A 
status. While these provisions in the legislation would give early 
protection to LPTV stations eligible for Class A status, they could 
also constrain the FCC from authorizing new analog television service 
for which applications are pending and that was protected in the 
development of the DTV Table of Allotments. Station licenses sought by 
these applications will be awarded through the competitive bidding 
process. The legislative provisions could also affect the transition to 
digital television by constraining the FCC from granting DTV 
applications proposing facilities that deviate from stations' allotted 
parameters (location, antenna height and power) in the DTV Table of 
Allotments, including site relocations or other changes necessary to 
resolve unforeseen problems.
    Second, the bill would appear to prevent the FCC from using 
competitive bidding in deciding among mutually exclusive applications 
where one or more of the applicants is a ``qualified Class A licensee 
or a translator rebroadcasting the signal of a primary service station 
within its designated market area.'' In these situations, the bill 
would require the FCC to give the applicants at least 60 days to 
develop an engineering solution so that the applications are not 
mutually exclusive. If this proved unsuccessful, the Commission would 
be required to devise a system for selecting among the competing 
applicants other than the auctions process that would maintain ``equal 
opportunities'' for Class A and translator applicants and that would 
encourage localism and diversity.
    I am concerned that this provision would be difficult to implement 
and could lead to delays in the authorization of broadcast service. 
Congress granted the FCC statutory authority to use auctions in the 
broadcasting context in the Balanced Budget Act of 1997. Prior to this, 
the Commission used a comparative hearing process to select among 
competing broadcast applications. Our long experience with this process 
taught us that auctions are a much more efficient and cost-effective 
method of assigning spectrum in cases of mutual exclusivity than any 
other method, including comparative hearings. The Subcommittee may wish 
to keep this experience in mind in considering the provision of the 
bill dealing with the FCC's auction authority.
    Finally, the bill provides that there will be no ownership 
restrictions on Class A stations. While unrestricted ownership was 
appropriate for the emerging and secondary LPTV service, it may not be 
appropriate for those LPTV stations reclassified as Class A facilities, 
with primary frequency use rights comparable to those of full-service 
broadcasters. The bill appears to contemplate applying most of the 
Commission's Part 73 regulations--those applicable to full-service 
broadcasters--to Class A stations. The Subcommittee may wish to 
consider whether the ownership provisions of that Part should also be 
applied to Class A facilities.
VII. Conclusion
    I want to close by restating Chairman Kennard's unequivocal 
commitment to creating a Class A LPTV service. He firmly believes that 
affording qualifying LPTV stations with substantial and enduring 
protections consistent with the digital television transition will 
serve the public interest and has urged his colleagues at the 
Commission to promptly address this matter in connection with the CBA 
petition now before the FCC.
    Thank you, Mr. Chairman, for the opportunity to appear before you 
today.

    [The prepared statement of Hon. William E. Kennard 
follows:]
   Prepared Statement of Hon. William E. Kennard, Chairman, Federal 
                       Communications Commission
    I am a strong supporter of Class A status for low power television 
(LPTV) stations. LPTV stations offer their communities significant 
services. They often function as a community's only local television 
station and commonly serve as exclusive outlets for foreign language 
and other special programming for unserved and underserved audiences. 
Many LPTV stations are owned by small businesses, minorities and women 
and thus help to enhance the diversity of ownership in the broadcast 
industry. I therefore commend the House Subcommittee on 
Telecommunications, Trade, and Consumer Protection for holding this 
hearing and the efforts of Representative Norwood (R-GA) and others to 
assure primary status for qualifying LPTV stations.
    As long as these LPTV stations are regarded as secondary 
operations, they may be vulnerable to displacement, especially in major 
markets. Moreover, even those stations that are not displaced may 
encounter difficulty in accessing.capital for programming, equipment, 
service and infrastructure improvements while they retain secondary 
status.
    For these reasons, and at my direction, the Commission sought 
public comment in 1998 on a petition for rulemaking submitted by the 
Community Broadcasters Association. The petition proposed, as does 
Representative Norwood's bill, H.R. 486, that we create a new Class A 
television station class for qualified LPTV stations providing 
substantial local programming. This Class A status would avoid the 
displacement of such stations by affording them primary status as 
television broadcasters as long as the station continues to meet the 
requirements for a qualifying low power television station. The 
Commission is currently reviewing this matter and I expect that it will 
adopt a Notice of Proposed Rulemaking in the near future. I have urged 
my colleagues to issue proposed rules that will make clear that LPTV 
stations will survive and continue to provide broadcast service to 
their communities.
    Meanwhile, I am pleased that the Subcommittee is holding this LPTV 
hearing and I offer it the Commission's assistance as it addresses this 
important telecommunications policy matter.

    Mr. Tauzin. Thank you, Mr. Stewart. Indeed, we have Mr. 
Kennard's statement, and it is very strong. Thank you, sir.
    The Chair is now pleased to welcome Mr. Jim May, Executive 
Vice President of The National Association of Broadcasters. Mr. 
May.

                   STATEMENT OF JAMES C. MAY

    Mr. May. Thank you, Mr. Chairman. When the FCC first began 
licensing low-power television stations in the 1980's, it did 
so with a specific and limited role in mind. It saw these 
stations as serving a small niche of very local interest and 
saw them as a secondary service to full-power television 
stations. The Commission granted neither the obligations, nor 
the privileges, of full-power licenses. Low-power stations 
owner understood that when they got their licenses. Yet, even 
with that difference, many low-power stations have become 
extremely popular, as evidenced by the comments on this panel 
today and the more than 2,100 that are on the air today.
    Enter the advent of digital television. This new technology 
is already beginning to provide viewers with the best quality 
picture and sound in television history. But the transition to 
digital is a very complicated process. It has required an 
almost magical fitting in of nearly 1,600 new digital stations 
between and among existing 1,600 full-service analog stations, 
serving virtually every portion of the country.
    And while the Commission has worked hard to make this 
transition a technical reality, it is still very much a work-
in-progress. The vast majority of these duplicate stations have 
yet to be built, yet to be engineered, yet to be tested, or put 
on the air. Fifty-seven digital stations are on the air now; 
four network affiliates in the top thirty markets will be 
broadcasting in digital by November of this year. That means 
the overwhelming percentage of stations have until May of 2002 
to go through that process. And the transition won't be 
complete until 2006. Please keep those dates in mind.
    Given the complicated matrix of digital television 
assignments, the FCC has made a sincere attempt to preserve 
service for as many low-power stations as possible. The 
Commission even expanded the core spectrum for DTV by five 
channels per market, in part, to relieve the pressure on low-
power stations. In the end, the vast majority will be 
maintained in the digital era.
    Now, with this background in mind, let us place the 
elements of H.R. 486 against the reality of that transition. 
H.R. 486 does several things. First, it makes many LPTV's 
primary status within 5 months of enactment. The qualifications 
for eligibility are minimal and it would appear that most LPTVs 
would qualify. It then virtually mandates the Commission grant 
them primary status, a status that gives them equal standing 
with and against full-power stations.
    The bill also protects the current low-power service area, 
while they are applying to become Class A primary stations. And 
perhaps most troubling, the bill further limits the protection 
that full-power stations or translators have in their digital 
build-out to an exceedingly narrow timeframe.
    What is the end result? We believe that broadcasters and 
the Commission will not, as Mr. Stewart said, have the 
flexibility that they need to make sure the digital transition 
occurs without causing serious disruption and interference.
    The bill also truncates the decisionmaking process by 
creating almost instantly a new television service with 
protections that are equal or exceed those of full-power 
stations and their translators. In short, it locks in LPTVs and 
their service areas before the DTV system is up and running and 
any changes are taken into account. Remember, it will be 2002 
before we truly know which changes are going to be required.
    Clearly, then, the biggest issue, is one of timing. No one 
can predict with certainty today what modifications or changes 
will be needed to make in the next few years, as the digital 
transition moves forward. That is why we cannot make decisions 
now about LPTV stations.
    Further, we can think of no circumstances where low-power 
station should have primary status over any current full-power 
station or its digital equivalent. We also believe LPTV 
stations should not have primary status over needed 
modifications to full-power stations, either operating or 
planned. And we simply don't know if there will be a need to 
make alterations to digital rollout as we go forward. We 
respectfully suggest that any of these decisions be put off 
until the transition is further along, when we have more 
knowledge of potential interference.
    Mr. Chairman, we are not arguing that LPTV stations do not 
provide an important service to viewers, and we applaud the 
efforts of the commission to preserve as many LPTVs as possible 
during the transition and into the future. We are suggesting 
that this Congress has mandated a multi-billion dollar 
transition to digital, which American broadcasters have 
committed huge resources and effort forward to.
    Mr. Chairman, let me note that the Commission has before it 
a petition for rulemaking on this very issue. It is our 
understanding that the FCC will act shortly to issue a notice 
seeking comment on these very same proposals. We would expect 
the Commission to continue to do all it can to maintain as many 
LPTV stations as possible during the transition and beyond. And 
we would hope that the committee would allow that process would 
go forward before intervening. Simply, I am not sure the 
Commission needs any new authority.
    Let me conclude, however, by saying that we pledge to work 
with this committee on a critically important issue. We 
understand the sponsors' interest in seeking a resolution and 
pledge our best efforts to find an agreeable solution.
    [The prepared statement of James C. May follows:]
Prepared Statement of James C. May, Executive Vice President, National 
                      Association of Broadcasters
    Mr. Chairman and Members of the Subcommittee, my name is James C. 
May and I am Executive Vice President of the National Association of 
Broadcasters, on whose behalf I appear before you today. NAB 
appreciates the opportunity extended by the Chairman to testify before 
this Subcommittee on H.R. 486, proposing a ``Community Broadcasters 
Protection Act'' intended to preserve low-power television stations 
that provide substantial local programming to small communities 
throughout the nation.
    NAB appreciates the sponsors' concerns for the many low power 
television stations that have been providing targeted or niche 
programming in the ``interstices'' of full service television service 
as the massive transition of this country's broadcasting system to 
digital technology begins.
    The digital revolution now upon us has extended to every form of 
technology in our nation and indeed in the world and is being felt in 
every sector of American life and business. It is enabling all 
Americans, no matter where they live, to participate in technological 
wonders not even dreamed of 20 or 30 years ago. It is exploding options 
for all Americans in their work, their schools, their continuing 
education, their investing, their hobbies, their art and their 
entertainment. Digital technology revolutionized the massive upgrade in 
television technology being planned for this country's free over-the-
air broadcasting system. Digital technology, the basis of our DTV 
standard, has expanded the number and types of television programming 
and television services that all Americans will be able to enjoy for 
free. Congress and the FCC have, in concert with the broader television 
industry, devised a plan to transition this nation's television 
system--long the envy of the world--to the wonders of digital with 
little if any disruption of service to the public.
    While the changeover in technology is revolutionary, total and 
necessarily involves replacing virtually all broadcast equipment and 
facilities as well as all consumer televisions, the public should not, 
under the FCC's carefully constructed plan, have their daily primary 
television service interrupted. While consumers will have to purchase 
new television sets, the FCC's plan allows them to do so over time, 
thereby affording them the benefit, over the length of the transition, 
of falling prices and the luxury of proceeding according to their own 
timetables--while continuing to see their familiar programs without 
interruption.
    However, this consumer-conscious plan for the digital television 
transition was not arrived at easily, nor is it yet perfected. It is, 
in the truest sense of the term, a work in progress. It has required an 
almost magical fitting in of over 1700 new digital television service 
areas in between and matching up with the over 1700 existing full 
service television stations, serving virtually every area of the 
country--and doing so in less spectrum than today's service occupies. 
These temporary ``duplicate'' stations are just now beginning to be 
built, re-engineered, negotiated with neighboring stations and with 
local community groups, tested, adjusted and, finally, broadcast to the 
very same audiences expecting their service.
    It was truly an extraordinary accomplishment to match every 
television station in the country with a same-service-area-replicated 
digital station while the to-be-replaced analog stations continue to 
operate pending consumer replacement of hundreds of millions of 
television receivers. This was achieved (to a great extent, but not 
perfectly or completely) after years of planning in order to preclude 
disrupting, to the greatest extent possible, consumers' highly valued 
and highly utilized free television service.
    But, given the extreme congestion of population and therefore 
stations in many parts of the country, the DTV plan could not achieve 
its primary goals of service area replication for every full service 
station and minimization of interference to existing television service 
while taking into account the secondary low power and translator 
services.
    The FCC did adopt certain measures in its DTV Orders to ameliorate 
the impact of the initial DTV Table of Assignments on low power 
stations. But only so much could be done in this regard--until all full 
service stations have perfected their DTV assignments.
    Accordingly, Members of the Committee have expressed a concern that 
the low power service be protected as much as possible, in the 
transition to DTV.
    While we at NAB would like nothing more than to be able to 
acquiesce to immediate accommodation of a certain class of low power 
stations within the digital transition, we can see no way to do so at 
this time--while we are in the midst of this fragile and just-beginning 
DTV transition. To try to do otherwise at this time would do a grave 
disservice to all consumers and to the digital television transition so 
long in the planning. NAB will do its best to work with the 
Subcommittee to try to fashion legislation that will not disserve the 
digital transition but will seek to preserve certain low power 
television operations at the earliest possible point in the digital 
transition.
    That said, I must note that the low power television service was 
created as a secondary service, to supplement full service operations, 
not to supplant, or vie for spectrum with, the broad-based television 
service that has always been the foundation of television in America. 
Low power operators applied for their licenses, and began their 
operations, with full knowledge that they must give way for full 
service operations. NAB appreciates that low power operators want their 
service to their audiences to survive in the digital transition, but we 
ask this Committee not to cause that to occur at the expense of full 
DTV service for all consumers.
    We in fact have similar concerns for the television translator 
service that extends the broad-based television service, including 
network television service, to thousands of rural Americans. The TV 
translator service, like low power operations, is a secondary service 
which similarly could not be protected or included in the initial round 
of DTV assignments. To do so for translators or LPTVs would have 
compromised the achievement of the service goals for the DTV Table, 
namely DTV replication of every existing full power television service 
area and minimization of interference to existing NTSC television 
service, which will be the primary free television service for most 
consumers for several years. Once, however, all full service DTV 
stations are substantially settled, many if not most low power and TV 
translators will be able to be accommodated in their NTSC mode and then 
with DTV service as well. Much can be done to these ends long before 
the end of the transition. Once all full service stations are on-air 
with DTV in 2002, the Commission will be able to evaluate how many 
LPTVs and translators can be accommodated with replacement NTSC 
channels for those bumped and second (DTV) channels for those low power 
stations seeking DTVs (rather than switching to DTV at the conversion). 
Once the conversion to all-DTV occurs in 2006, the NTSC channels within 
the core DTV spectrum will be freed-up and there should be ample room 
for all LPTVs and translators to have DTV homes as well.
    To further these ends, and to explain to you the specifics of my 
concerns with (and possible amendments to) the bill before us, I would 
like to proceed to the terms of the legislation itself.
    First, this legislation appears to seek two goals, which taken 
together pose challenges for the DTV transition that simply cannot be 
accommodated at this point. One, the bill seems primarily aimed at 
``permanently'' preserving certain low power stations by creating a new 
class of stations with ``primary'' status, which could not be displaced 
by any other user, including full power DTV stations. Two, the bill 
also appears to grant a preference these ``new'' LPTVs for new DTV 
licenses over translators and full service DTV modifications alike. The 
entire bill, including a provision for Class A stations to be strongly 
considered for an ``advanced television'' license, would be placed in 
the section of the Communications Act (Sec. 336) that concerns 
``advanced television'' services and licenses for the new service. This 
legislative bias in favor Class A DTV licenses, however, comes without 
regard for the DTV assignments and needed modifications of full-power 
stations and cannot be squared with the rollout and tweaking of full 
service DTV facilities. I urge this Subcommittee not to direct action 
that might compromise the perfecting of full service DTV assignments so 
long under construction and benefiting so many consumers.
    Second and possibly the major improvement that could be made to 
this bill, is the time within which the Commission is to ``prescribe 
regulations'' creating Class A low power licenses. The bill currently 
provides for FCC regulations ``within 120 days'' of enactment. This 
time period could direct the creation of new permanent Class A licenses 
before the vast majority of full service stations will have filed for 
their DTV construction permits, before they have had a chance, to re-
engineer their facilities, if needed, change channels, if needed, join 
with other broadcasters to locate and construct a new joint tower, if 
needed, or otherwise perfect, or maximize (as is contemplated in the 
FCC's rules) their DTV facilities. The result well could be Class A low 
power station's trumping needed modifications for full service DTV 
stations and thus compromising the DTV transition in its infancy. We 
respectfully suggest that this be considered only some time after all 
initially-eligible DTV licensees are granted DTV licenses by the 
Commission.
    Third, we would recommend, for the same reason, that any 
legislation, with appropriate timing, would specifically provide that 
in no event will the Class A licensee have primary status as against 
any initially-eligible DTV station or any existing NTSC licensee.
    Fourth, the bill only provides interference protection to Grade B 
contours of existing stations or to DTV service areas provided in the 
DTV Table or modified before the filing of the Class A application. 
Again, timing is the major problem. To avoid disruption to the 
perfecting of full service DTV service to the public, the Class A's 
simply should not have primacy over any full service DTV modifications 
or over any pending NTSC facilities modifications.
    Fifth, we do have serious concerns over the bill language 
potentially allowing Class A low power stations to raise their power 
levels in accord with the operating rules for full service stations. We 
believe that low power must remain low power and be constrained by the 
power limitations applicable to all low power stations.
    Sixth, with regard to the bill section on issuance of advanced 
television licenses, NAB strongly believes that there should be no 
built-in bias toward Class A DTV licenses over those for TV 
translators. We also strongly believe that there should not be any 
possibility, as there is in this bill, that Class A DTV applications 
might trump full service DTV assignments or yet applied-for 
modifications thereto. Thus, timing is again the main stumbling block. 
But so too is the preference for low power DTV assignments over those 
for full service-extending translators, which serve primarily rural 
consumers free broad-based television service.
    Seventh, if and when Class A's are to assume the permanency of 
primary stations, they should be required to adhere to the same 
restrictions as full service stations. In particular and specifically 
raised in this legislation, Class A licensees should be subject to the 
same ownership restrictions as full power televisions stations.
    Lastly, the bill section that addresses ``interim qualification'' 
of out-of-core LPTVs, again depending on timing, should not permit such 
LPTVs' finding a home within the core DTV spectrum to override needed 
modifications of full service DTVs by ``automatically'' granting Class 
A primary status as against future modifications by full service 
stations.
    As is clear from the above-recitation of substantive problems with 
H.R. 486, NAB's main problem remains with the timing of the creation of 
new Class A low power stations. Knowing that this Chairman and this 
Committee are committed to the best and full deployment of digital 
television for the benefit of all consumers, NAB urges you to postpone 
further action on this bill until the DTV dust has clearly settled. 
Once it has, it should be the first and top priority of the FCC to 
accommodate both low power stations and translators in the brave new 
DTV world.
    Let me close by noting that in our view the FCC requires no new 
authority to aid LPTVs in the midst of the DTV transition, in the same 
ways this legislation suggests, or otherwise. In fact, the Commission 
has before it at this very moment a petition for rulemaking along the 
same lines as the legislation before this Subcommittee. It is our 
understanding the FCC will act shortly to issue a Notice seeking public 
comment on these same proposals. We expect the Commission will continue 
to do what it can for low power stations, consistent with its 
responsibilities for the DTV transition.
    Mr. Chairman, again I thank you and the Subcommittee for inviting 
my participation in this hearing.

    Mr. Tauzin. Thank you very much, Mr. May.
    The Chair is now pleased to welcome Dr. Arthur Stamler, the 
station General Manager at a LPTV station, WAZT, the Waltz TV, 
LPTV, in Woodstock, Virginia. Mr. Stamler, for your testimony, 
sir.

                 STATEMENT OF ARTHUR D. STAMLER

    Mr. Stamler. Thank you, Mr. Chairman. It is good to be here 
today. I would like to also introduce my wife, sitting behind 
me, Virginia, who is my co-partner in WAZT. We both started it 
together some 15 years ago.
    I started my career in broadcasting 47 years ago in Boston. 
It is all I wanted to do, is to be in broadcasting, and I was 
pleased to see that my dream had come true. And my entire 
professional career has been in broadcasting. I was a 
department head at the National Association of Broadcasters in 
the late 1950's and early 1960's, when the then-Chairman of the 
FCC called television a vast wasteland.
    I didn't believe it then, and I sure don't believe it now. 
There are television stations who are every bit professional. 
And WAZT considers itself to be professional.
    Over the course of years, I have seen major changes in the 
broadcast industry when FM came in; when UHF came, and the VHF 
broadcaster said was going to put them out of business; when 
color television came in and black and white went out; when 
cable systems came along; when satellite technology came along, 
and now direct television to the home. There are changes that 
will continue and the industry has to roll with the changes.
    And to protect an existing industry, over what may or may 
not happen in the years to come at the expense of industry that 
is serving the American public, I believe is not the intent of 
the Congress when it established it or the intent of the FCC as 
it supervises it.
    WAZT is a primary source of news, and information, of 
spiritual enrichment, of local events, of local school sports, 
and that very special, nothing-like-the-Washington-DC weather 
forecast, even though we are only located 100 miles west of DC.
    Mr. Tauzin. Do you need a pair of beavers by the way?
    Mr. Stamler. Excuse me, sir.
    Mr. Tauzin. I wondered if you could use a pair of beavers; 
we have got a little problem I think.
    Mr. Stamler. To thousands of viewers in our area, we are 
their local television station, and the term ``low-power'' 
doesn't mean anything at all. It is so vital for any television 
station, when operating, to present to its viewers the ability 
to see quality as they click through the channels with that 
remote control. It doesn't make any difference whether they are 
full-power or low-power. The stations are on the air to do 
something.
    Our station went on the air with 49 watts. That is less 
than a 60-watt lightbulb. And when it when on the air, we were 
every bit as professional as our neighbor full-power television 
station 60 miles down the road in Harrisonburg. As a matter of 
fact, they have become quite friendly with us and treated us 
equal. We are members of the Virginia Association of 
Broadcasters. And the full-power television stations treat us 
as equal.
    We are members of the National Religious Broadcasters 
because our basic format has religious programming. It is the 
only religious television station from the Maryland line to the 
West Virginia line for 150 miles through the Shenandoah Valley. 
It fills a niche that is so needed because that area is called 
the Bible Belt in Virginia. So we found something that the 
people needed and we give it to them. In addition, we have a 
fully staffed local news department. We have 21 local preachers 
that are on the air providing their programming for our local 
area.
    This becomes a forum for each of the communities for the 
county government, for the town government, for the city 
governments.
    I mentioned a few moments ago that we are members of the 
National Religious Broadcasters Association. This committee 
should know that WAZT was named ``Television Station of the 
Year'' in 1998. And that is in full competition with a number 
of full-power television stations around the country. So, 
according to those professionals, we must be doing something 
right.
    Our investments are hard to come by because we are 
temporary; we are secondary, and I equate that word with 
temporary. The bank looks at us and says, ``How long will you 
be in business? Why should we give you money to buy a new piece 
of equipment?'' Mr. Chairman, we buy the best second-hand 
equipment you can buy. We would like to buy first class.
    Let me complete with just two brief sentences. There is an 
old hymn that says, ``We've come this far by faith.''
    And I would like to know that we have some blessed 
assurance that we can continue. Thank you.
    [The prepared statement of Arthur D. Stamler follows:]
  Prepared Statement of Arthur D. Stamler, General Manager, WAZT-LPTV
    My name is Arthur D. Stamler. I am the Managing Member of Ruarch 
Associates Limited Liability Company, licensee of Low Power Television 
Station WAZT, Woodstock, Virginia. Let me first offer congratulations 
to this Subcommittee and to the Congress for its foresight in the 
establishment of the Low Power Television Service nearly twenty years 
ago. What had been envisioned then has come to pass now--television 
media to bring local service to underserved areas and markets 
throughout the United States. When I categorize areas I specifically 
refer to locations that either because of remote distances from major 
communities or terrain shielding preventing local reception were unable 
to have local program choices. And when I categorize markets, I mean 
the very specific publics that prefer narrowcasting linguistically or 
topically to meet local desires. In the lptv industry, WAZT is referred 
to as a pioneer broadcaster. Our station started service in 1985 after 
a two year building program. WAZT, then W10AZ, applied for and received 
a construction permit and license to serve greater Woodstock, 
population about four thousand, within the County of Shenandoah, then 
with a population of less than 18-thousand people. Our granted power 
was 49 Watts, less than the power of a light bulb. But we were 
television broadcasters, and went to work to make W10AZ the best local 
television station money would buy. But no bank would provide any funds 
on loan, and monies received from the sale of our home were 
insufficient, so my wife and I set out to encourage local investments. 
We were fortunate to attract investors from the local area: a dairy 
farmer, a farm implement dealer, a retired federal employee, a 
physician, an accountant and several others. We determined one thing 
from the very outset, that is, we would be professional and local from 
the very first day. And we have had a local newscast every weekday 
since the station went on the air, even with 49 Watts.
    My dreams of operating as a professional television station have 
never wavered. But the ability to do it has been at tremendous personal 
cost, financially and healthwise. My wife and I went for more than 
three years without a paycheck, borrowing against savings, life 
insurance, and even credit cards as a last resort. WAZT existed for 
more than a year while the local cable system refused to carry the 
station, so our 49 Watts had an audience that retained rabbit ears. Our 
staff learned the television business on the job. Without a budget to 
hire professional television people, we trained them while they worked, 
never had to go outside of the Shenandoah Valley for staff. Gradually, 
one piece of used equipment at a time, we added and upgraded and 
improved our facility. Public outcry demanded that WAZT be placed on 
local cable, and it finally was. Our philosophy was then, and is now, 
that any viewer should be able to click on a remote control and not be 
able to tell the difference between any station or satellite service 
and WAZT. Our engineer used a lot of tape and bailing wire and 
imagination to keep us on the air and looking good as we moved from 
crisis to crisis. We were able to seek and find available channels in 
adjacent communities, and received licenses to serve them as well, 
expanding our coverage of adjacent communities and enlarging the scope 
of our news and information. On the occasion of our fifth anniversary, 
we invited the Low Power Television Branch of the Federal 
Communications Commission to come visit this station, the closest to 
Washington, D.C. They came. Three vans full. Most of the personnel had 
never been in any tv station, let alone a low power facility. They 
learned what the business they were regulating was all about, a very 
valuable trip. I would like to extend the same invitation to the 
members of this Subcommittee and staff as well. Come see what Congress 
proposed and what we have composed. It is as much a television station 
as anything you could shake a remote control at. I would be amiss at 
this juncture if I did not express my appreciation and gratitude to the 
staff at the Low Power Television Branch, especially the former Chief, 
Keith Larson who believed in the Congressional LPTV mandate and watched 
us toe the line to comply.
    WAZT has chosen to provide our communities of license with programs 
keyed to spiritual enrichment. We are located in what has become known 
as the Bible Belt in Virginia, but there were no religious television 
stations serving that concept. As a matter of fact, from the top of the 
state just North of Winchester all the way to Roanoke, some 300 miles 
away, there was only one television station, a network affiliate. The 
area is isolated from the Washington area by the Blue Ridge, so DC 
stations were received with great interference, if at all. WAZT filled 
a void and continues to be the only local independent station providing 
a forum for advertising, community events, area sports, political 
debate, locally produced lively arts, plus two thirty minute actuality 
filled news reports each weekday evening, one at 5:30 and one at 9:00 
PM. WAZT is not exactly a powerhouse now, even though some high band 
VHF stations can apply for as much as ten thousand watts. Our 670 Watts 
seem to be doing an adequate job in Shenandoah County. WAZT, with five 
surrounding translator stations, operates 24 hours a day, seven days a 
week. It has still been denied cable carriage in three area systems, 
but we have patience that some day those systems may relent. More than 
two million dollars has been invested in bringing WAZT to its current 
posture. Now, we are looking at converting our on-channel facilities to 
a digital format in keeping with the current timetable proposed by the 
FCC. That will mean duplication of virtually all production and 
transmission facilities plus an extensive and expensive engineering 
consultation and installation. That will mean not less than a million 
dollars for a bare bones transition. No business on earth would take on 
that much debt, knowing that it could be terminated in a heartbeat. No 
financier knowing of the very secondary and temporary licensing of an 
LPTV would consider a loan or a lease for new digital equipment. 
There's an old hymn that says ``we've come this far by faith''. Now we 
need some blessed assurance. I need to go back to Woodstock and tell 
those 21 local preachers that they will be able to stay on the air. I 
need to tell my staff of 18 that their jobs are secure. I need to tell 
my investors that there's pretty good chance their investments are 
secure. I need to tell my wife we did the right thing fifteen years 
ago. I need the permanent status that we have desired, and now is 
within sight, and I promise that my facility will do whatever is needed 
to see that it happens.

    Mr. Tauzin. With all of the connections that you have got, 
I didn't want to turn you off, even if the red light was on.
    Thank you, Mr. Stamler.
    We are now pleased to welcome Mr. Michael Sullivan, 
Executive Director of Community Broadcasters Association of St. 
Cloud, Minnesota. Mr. Sullivan.

                  STATEMENT OF MICHAEL SULLIVAN

    Mr. Sullivan. Thank you, Mr. Chairman. I am the Executive 
Director for Community Broadcasters Association. That is the 
national organization that represents the low-power television 
in the country. I was going to, as you can see, in my 
statement, sort of brag, or really explain what low-power 
television is--and I see you smiling--HTV in Houma, Louisiana. 
Mr. Deal has talked about channel 43 over in Dalton; Mr. Oxley 
has already talked about channel 67; Mr. Klink has all that he 
can say in terms of western Pennsylvania and where high school 
football is king, plus some of the other programming that is 
provided by Ron Bruno, to my left here.
    You all know you are learning today, if you didn't know 
before, what low-power is, what low-power television can do. 
The big threat--and you know that we are secondary status. We 
are not here today, Mr. Chairman, to complain about digital; we 
are not complaining about the public safety allotments; we are 
not complaining about the commercial allotments. The Congress 
directed the Commission to do that, and in a lot ways I think 
it is sound public policy. We are not here to argue that.
    Mr. May referred to the impact of what this has done, and 
that is, considerably shrink available spectrum, available for 
broadcast television. And that has probably created the single 
greatest need for primary status, because what happens is Mr. 
Deal's constituent or your own constituent, Mr. Chairman, 
basically they not only have gone through the bumping process 
that we just had with those three other incidents; they risk 
tomorrow, the following day, and every day in the future, 
getting bumped not only once, but twice, and three times.
    Mr. Oxley's constituent, for example, has just re-channeled 
67 and he is now FOX 25 in the Lima, Ohio market; put a 
$100,000 to do that; he has no protection whatsoever, about not 
getting bumped again. Mr. Sawyer was here talking about a full-
power station just vacating that Akron market, which is 
understandable. Maybe that sounds rather harsh on my part, but 
it basically vacated the Akron market to go to the ``Big 
Apple'' of that television market, which is Cleveland. When you 
can go to a market of 1.4 million versus the couple of hundred 
thousand of Akron, Nielsen is much better to you when you are 
there.
    And television is about numbers; television is about 
Nielsen, and one of the special things about low-power 
television is that we are not bound to ratings because we 
weren't created--Jim says it very well; we were really created 
as a supplemental television service. But as it is 
supplemental, it means we translate that into basically into 
pockets of underserved. These pockets of underserved exist both 
in rural and urban communities. The District of Columbia or the 
Washington Metro is a wonderful example of that. There are two 
Spanish language stations here in the Washington market, 
channel 48 and channel 64. They are both low-power stations. 
There are 300,000 Hispanics in this market. They need some 
security, and I think all of the community broadcasters believe 
that number of Hispanic people clearly deserve television in 
this kind of market. Where I come from 300,000 folks is a half 
a congressional district. You know, to me those are big-time 
numbers; those are people who really deserve.
    Back to Akron for a moment, what happens, Mr. Sawyer 
mentioned that the station isn't everything is could be or 
should be; we know that. The owners of that station know it. 
About a million dollars separates it from where it is today and 
to be truly a full-service station. How can they do that with 
the threat of being bumped tomorrow, the next day, and the next 
day?
    We have other problems, too. If we are going to stay in 
television, we have to transition to digital. We are told that 
is very expensive. How do we do that?
    Last point, no matter how good you feel about low-power 
television, if low-power television is going to mess up 
digital, you can't consider it and we shouldn't advocate it. 
Very simply, we want to believe that section 7 in the Norwood 
bill is real, is serious, creating no interference for full-
power digital stations. There will be no Class A if they create 
interference.
    Thank you; I see the red light.
    [The prepared statement of Michael Sullivan follows:]
  Prepared Statement of Mike Sullivan, Executive Director, Community 
                        Broadcasters Association
    Chairman Tauzin and members of the Subcommittee, we are very 
pleased to be here today. We are grateful to you, Mr. Chairman that you 
would provide community broadcasters throughout the country and other 
interested parties the opportunity to examine and discuss the issue of 
changing the ``Regulatory Classification of Low Power Television 
licenses.''
The Case for Primary Service Designation
    As you know, Mr. Chairman, the current regulatory classification of 
low power television is one of secondary status. Secondary service 
simply means that when the Congress or the Commission designates 
spectrum used by LPTV service for other purposes and classifies those 
purposes as a primary use of spectrum, the secondary service is 
displaced. If no other spectrum is available the station simply goes 
dark. Some will argue that those are the breaks. The licensee should 
have understood the rules before they built the station. They took the 
risk with their eyes wide open. Now let them take the loss.
    Others go a step further asking, ``who are these folks?'' They 
continue, ``when we're surfing the channels, we thought television was 
television.''
    If you are in Dalton, Georgia, it's station WDMN providing over 15 
hours of original local programming per week in five counties of North 
Georgia. If you are in Hopkinsville, Kentucky it's station WKAG serving 
most of western Kentucky with significant local news and community 
affairs for which there is no competitor. If you are in Houma, 
Louisiana, it's H-TV providing the only regular local television 
programming for that community of 100,000 population. H-TV doesn't just 
play television, it originates 12 separate local programs each week for 
that community. If you are in Lima, Ohio it is Fox-67 which was 
recently displaced and is now Fox-25. Local programming is also their 
signature as it is also in New Castle Pennsylvania where high school 
football is king. If you are in Reidsville, North Carolina, Plano, 
Illinois or Laramie,Wyoming it's low power television making a 
difference for the citizens of those communities. If you are here in 
Washington D.C. as we are today, it's channels 48 and 64. These are the 
only two Spanish language stations in this market serving the estimated 
300,000 Hispanic people in the Washington Metropolitan area. If you are 
in Hartford, Albuquerque, Miami, San Diego, San Francisco, Portland, 
Denver, Salt Lake or Milwaukee there are low power Spanish language 
stations in those markets. In fact, it is estimated that between 40-50% 
of the Spanish language television stations in the country are low 
power stations. But that should be no surprise. The low power service 
is a community based not market based television service. Its purpose 
is not to compete with full power service but to serve the underserved 
in both rural and urban communities.
    What we really see in low power television today is a FCC program 
that worked. When the service was created in 1981, did we know it was 
going to work? Did we know that low power television would find a 
niche--maybe not in every market but in every one of the.50 states of 
the United states? Did we know at its inception that many of these 
stations, while low in power, would meet every measure of a full 
service television station in their niche markets?
    I believe the answer to these questions is no. But there was much 
more that we didn't know.
    Did we realize during the decade of the 80's that television 
spectrum would be reduced by 108 megahertz--a full 18 channels? Did we 
realize then that the 1990s would bring the full implementation of DTV 
where every full power station would receive a second 6 mHz channel? 
This was more than 1700 new allotments Mr. Chairman, how could have 
these low power licensees--even those with their eyes fully opened--
envisioned such radically changed circumstances?
    What we did know is that secondary service could mean 
displacements. But not even the best low power television historians 
can list five stations during that decade that were displaced and not 
successfully rechanneled.
    The recent DTV, Public Safety, and Commercial spectrum allocations 
have changed that dramatically. From an environment where one might say 
we had spectrum abundance we are now challenged with significant 
scarcity. This has change considerably the investment environment in 
community television.
    We're here today because we want you to know what impact this 
change has on our communities and operators. Here are three examples.
    First, just a week ago in Akron Ohio, the Mayor's Advisory Board 
had a town meeting with local citizens listening to input on ways to 
improve their community in the next century. 100% of the local citizens 
attending wanted to see a television station back in Akron, a community 
of over 200,000. Their full power station left town for Cleveland, the 
big apple in that market. The irony of this story is that there is a 
television station in Akron right now. It's WAOH. LP owned by local 
residents who want to improve their service to the Akron community. But 
to become a truly full service station in that market, WAOH would have 
to make a capital investment of approximately $1 million. By many 
measures, that is a modest investment. But with the threat of future 
displacements and the almost non-existence of other available spectrum 
in that market, that which could be a modest investment becomes almost 
foolishly risky.
    Second, I cited stations in Dalton, Lima, Houma, Reidsville, New 
Castle, Albuquerque and many others. The Commission is in the process 
of granting over 600 new assignments to those displaced by DTV, Public 
Safety and Commercial allotments. So long as these stations are 
secondary, they can be displaced again and again and again.
    Yes, Dalton, Lima, Houma and Plano low powers made way for DTV and 
full replication of every full power licensee in their markets. 
Everyone of these stations need the Norwood/Klink bill and they need it 
before they are displaced again.
    If that isn't enough, low power television has a third challenge. 
We also have to make the digital transition. Without investment 
security and without a reasonable means to raise outside capital, this 
transition for community broadcasters will become hugely difficult.
    Sherwin Grossman, CBA's President, who has both developed 
television stations and chartered banks, maybe summarized today's 
investment environment best. He said, ``If I had a loan officer who 
made a loan to a low power station today, I'd fire him or her on the 
spot.'' He probably just knew that if he didn't fire him, the bank 
examiner would close the doors of the bank.
Impact on DTV Roll-Out
    Now even if all of us agreed that there is a compelling case for 
primary service designation, CBA realizes it won't happen if it 
jeopardizes DTV implementation.
    For this reason we become both mystified and deeply troubled by the 
allegations of our fellow broadcasters at NAB. Here is a sample.
     By giving LPTV stations primary status, the FCC will not 
be able to assure consumers that the transition to digital by full-
power stations can proceed inteference-free . . . It makes no sense to 
tie the hands of the FCC by preventing them from turning off LPTV 
service where interference is occurring.
     Full power broadcasters are working hard to meet the 
aggressive timetable laid out for digital. Passage of legislation could 
threaten to slow down that transition further.
     Any LPTV amendment would threaten to further complicate an 
already complex transition to digital television.
     If that (legislation) were to occur, the transition to 
digital itself could be in jeopardy. Clearly, increased interference to 
new digital services would be disruptive.
     (If legislation is approved) it could block efficient roll 
out of digital TV.
    CBA believes these assertions are very serious. But, CBA and many 
others also believe that Sec (7) No Interference Requirement is clear 
and precludes a threat of interference. The legislation reads: ``The 
Commission may not grant a Class A license . . . unless the applicant 
shows . . . the license . . . will not cause interference within . . . 
the DTV service areas provided in the DTV Table of Allotments or 
subsequently granted by the Commission prior to filing the Class A 
application.''
    We can only ask, what doesn't this say that it needs to say? As CBA 
understands this legislation, when an LPTV licensee submits to the 
Commission a certification of eligibility under the terms of (f)(1) of 
this legislation, the Commission will neither grant this certification 
nor preserve the protected contours of the low power station, if such 
an applicant creates interference within the protected contour of any 
DTV allotment.
    Help us out. How does this place the DTV transition in jeopardy? 
How does this result in increased interference? How does this slow 
down? How can this block? How does this tie the hands for the 
Commission? What does this have to do with assuring viewers 
interference few digital reception?
    We believe the no interference standard assures every full power 
station in the country frill utilization of its DTV allotment. As a 
practical matter, maybe the Senate Commerce Committee came to the same 
conclusion when they reported S. 1427, a companion to H.R. 486, last 
October 1 by a unanimous voice vote. Maybe Chairman Kennard and his 
engineering staff came to a similar conclusion. In the Chairman's July 
27, 1998 letter to Senators he wrote, ``Having reviewed this 
legislation, I have no major concerns with this bill.''
    Almost no one is a more committed, enthusiastic, and determined 
advocate of a rapid DTV roll-out than Chairman Kennard. For CBA, it is 
inconceivable that the Chairman and his staff would find ``no major 
concerns'' with this legislation, if there was any serious, credible, 
documented technical evidence showing that these assertions have merit. 
If this committee comes to any different conclusion than Chairman 
Kennard or the Senate Commerce Committee, please advise us immediately 
and we will work with you on corrective measures.
    Mr. Chairman, we want the digital television to work because we 
want to be part of it. Thank you so much for the opportunity to address 
the committee today.

    Mr. Tauzin. Thank you very much, Mr. Sullivan. I want to 
congratulate you on knowing how to talk committee language. I 
think you have touched every member with that comment.
    We are now pleased to welcome Mr. George E. DeVault, Jr., 
President of Holston Valley Broadcasting Corporation. I 
understand you own both full-power and low-power television 
stations.

               STATEMENT OF GEORGE E. DEVAULT, JR.

    Mr. DeVault. That is true, Mr. Chairman.
    Mr. Tauzin. We welcome your testimony, sir.
    Mr. DeVault. Thank you for inviting me. Holston Valley 
Broadcasting is one of the handful of television broadcasters 
which operates both so-called full-power and low-power 
stations. Our high power, if you can call it that, WKPT is a 
UHF station, signed on about 30 years ago. We have been the ABC 
affiliate in our market all these years. Our principal low-
power station, WAPK, signed on in 1991. It has been the local 
UPN affiliate since that network's inception.
    And to add something to what I have given you in writing, I 
just returned from a conference today of UPN affiliates, at 
which I discovered that 34 markets in this country receive 
their UPN programming through LPTV affiliates. WKPT has been a 
member of the NAB for decades and WAPK a member of the CBA 
almost as long as that organization has been in existence, and 
both stations are members of the Tennessee Association of 
Broadcasters.
    As others have done here today, I would like to correct the 
misconception that LPTV stations have to be tiny facilities 
with coverage limited to just a few miles and programming that 
some would call unattractive. Although it is a LPTV station, we 
operate WAPK like any traditional television station. It 
telecasts local news, weather, sports, news briefs 5 days a 
week. It has produced many other local programs: high school 
baseball games, one college basketball game; we do a couple of 
parades each year, sometimes more, live local candidate 
debates. We have produced religious shows. We carried for many 
years, the programming, the meetings of the city council, in 
both Johnson City and Kingsport. And we also carry a lot of 
nationally recognized programs in additional to those from UPN, 
syndicated shows like ``Entertainment Tonight'' and ``People's 
Court,'' and ``Touched By an Angel,'' and a lot of those you 
see on full-power stations around the country.
    We also carry a lot of sports. In addition to those local 
things, we have carried the Cincinnati Reds, the Charlotte 
Hornets, ACC football and basketball, SEC basketball, the 
Tennessee Oilers, and this year the Atlanta Braves. And 
although low-power stations are not required to do so, WAPK 
carries some 4 hours of children's educational and 
informational programs each week, and we are going to multiply 
the number of hours of such programming we carry, beginning 
this fall.
    Our LPTV station is carried on some 25 cable systems, 
reaching just under 100 percent of all the cable-connected 
homes in our eight-county TV metro, and about 85 percent of the 
cable homes in the full 17-county market. We even achieve 
modest--and I emphasize modest--Nielsen ratings, and we 
subscribe to their service, and our schedules are carried in TV 
Guide, and the local newspapers.
    Our concern is the same as the others here today, and that 
is whether WAPK will survive in the future, because it is a 
low-power station, a secondary service. We filed a displacement 
application to move to another channel, and we have learned, in 
getting the estimates of what it is going to cost, that it is 
expensive. And of course, one of these days when they turn off 
the analog, we will have to transition again to digital. We 
believe LPTV stations, should not face the possibility of 
having to change channels again, and again, and again; or the 
possibility of having to terminate their operations all 
together--just because, sometime in the future, a full-service 
station who has already built its digital, decides it wants to 
increase its power, or because the Commission decides, the FCC 
decides, to license more full-service, or full-power stations, 
or because someone here in Congress, or at the Commission, 
decides to allow pizza delivery trucks, or taxi company radios, 
to become primary users of these frequencies.
    The bill now before the House, H.R. 486, as you know, will 
bestow primary status on qualifying LPTV stations, once those 
stations make any initial required moves to accommodate digital 
television. Interestingly, the obligations that LPTV stations 
must assume in order to qualify in some ways exceed those that 
the FCC requires full-power TV stations to meet. The case in 
point is the requirement that qualifying LPTV air at least 3 
hours per week of programming produced within their local 
markets. Many full-power stations do not meet this standard; 
they are not required to. The manager of the local FOX 
affiliate in our markets, a good friend of mine, his stations 
are operated by one of the largest groups in the country, but 
he has no local news, and essentially no local programming at 
all.
    As you have heard today, many low-power broadcasters, most 
we know are good broadcasters, and we believe the power levels 
that the FCC has allocated for full-service DTV stations will 
replicate the station's existing analog coverage. The station 
later decides to apply for more power, and add that small donut 
of additional coverage. If that interferes with the low-power 
station, we believe the FCC should have the authority to issue 
a show-cause order requiring that low-power station to again 
change channels if, and only if, an alternate channel providing 
comparable service can be found, and the full-service station 
creating the displacement agrees to pay all reasonable costs 
incurred. There is precedence for this in the FM service.
    That concludes my remarks. Thank you, Mr. Chairman.
    [The prepared statement of George E. DeVault, Jr. follows:]
Prepared Statement of George E. DeVault, Jr., President, Holston Valley 
                        Broadcasting Corporation
    Thank you, Mr. Chairman. It is my pleasure to represent Holston 
Valley Broadcasting Corporation, in these hearings today. Holston is 
one of a handful of television broadcasters, which operate both so-
called full power and low power TV stations. Our WKPT signed on almost 
30 years ago and has always been the Tri-City, Tennessee-Virginia 
market's ABC affiliate. Our principal low power TV station WAPK signed 
on in 1991 and has been the local UPN affiliate since that network's 
inception. Actually what we refer to as WAPK is a network of four LP 
stations, each covering different parts of our market and all carrying 
the exact same programming. WKPT has been a member of the NAB for 
decades; WAPK has been a member of the CBA almost from that 
organization's inception.
    Although it is an LPTV station, we operate WAPK like any 
traditional station. It telecasts local news, weather, and sports 
programs and news briefs five days a week. It has produced many other 
local programs, high school baseball games, one college basketball 
game, two or more local parades each year, and live local candidates 
debates. We have telecast locally-produced religious shows. For years 
WAPK telecast the meetings of the Johnson City Commission and the 
Kingsport Board of Mayor and Aldermen. Not only does WAPK carry 
national programming from UPN, its syndicated offerings are among the 
top shows nationally including Entertainment Tonight, Real TV, Extra, 
People's Court, Touched by an Angel, and dozens more.
    In addition to local sports telecasts WAPK has carried Cincinnati 
Reds Baseball, the Charlotte Hornets, ACC Football and Basketball, SEC 
Basketball, Tennessee Oilers games, and beginning this year the Atlanta 
Braves.
    Although low power stations aren't required to do so, WAPK carries 
some four hours of children's educational and informational programs 
each week.
    WAPK's programming is carried on some 25 cable systems reaching 
just under 100% of the cable-connected homes in the eight county Tri-
Cities TV metro and almost 85% of the cable-connected homes in the 17 
county total TV market.
    WAPK achieves modest Nielsen ratings and subscribes to the Nielsen 
service. Its schedules are carried in TV Guide and in all major local 
newspapers.
    Holston's concern today is whether WAPK will survive in the future, 
because it is a low power station and, therefore, is currently 
classified as a ``secondary'' service. We have already filed a so-
called ``displacement'' application with the FCC to move to another 
channel, and we're seeking channels for the three other stations in 
WAPK's little network, which are also to be displaced. Changing 
channels is expensive; however, we accept the need to change channels 
in order to allow the development of Digital Television. At some point 
before all analog signals are shut off, LPTV stations will also have 
the expense of converting to digital transmission.
    What we believe the LPTV industry should not face is the 
possibility of having to change channels again and again and again or 
the possibility of having to terminate their operations altogether, 
because sometime in the future a full service station, which has 
already built its digital facility, wants to increase its power, or 
because the Commission decides to license another full power station, 
or because the Commission decides to allow pizza delivery trucks, taxi 
cab companies, and the like to become so-called ``primary'' users of 
these frequencies.
    The bill is now before the House, H.R. 486, will bestow ``primary'' 
status on qualifying LPTV stations once those stations make the 
required move to accommodate digital TV. The obligations LPTV stations 
must assume in order to ``qualify'' in some ways exceed those the FCC 
requires ``full power'' TV stations to meet. A case in point is the 
requirement that qualifying LPTV's air at least three hours per week of 
programming produced within the local market. Many full power stations 
don't meet that standard. The manager of the local Fox affiliate in our 
market is a good friend of mine. His station is operated by one of the 
nation's largest groups, but his station has no local news and 
essentially no locally-produced programming at all.
    I have immense respect for the NAB; for years I chaired its UHF 
Committee. In fact if I had accepted the job of Vice President for TV 
at NAB when I was privileged to be offered it many years ago, I 
wouldn't be here today, and I'd probably have a much better retirement. 
My good friend Jim May and the NAB oppose ``primary'' status for any 
LPTV stations. I say to Jim and to you: LPTV broadcasters who qualify 
under the proposal are good broadcasters. In many cases they are more 
attuned to the problems and needs of their communities than many full 
service broadcasters.
    As both a full power and a low power broadcaster, I do offer 
compromise between the positions taken by these two fine organizations:
    The power levels the FCC has allocated for full service DTV 
stations are designed to replicate such stations' existing analog 
coverage. If such a station later decides to apply for more power, and 
adding that small ``doughnut'' of additional digital coverage would 
interfere with a qualifying LPTV station, I believe the FCC should have 
the authority to issue a ``show cause'' order requiring that LPTV 
station to again change channels  if and only if, 1) an alternate 
channel providing comparable service can be found, and 2) the full 
service station agrees to pay all reasonable costs incurred including 
not only the technical expense, but also such items as signage and re-
printing letterhead and business cards. There is precedent for this in 
the Commission's past rulings.
    That concludes my prepared remarks. Thank you again, Mr. Chairman, 
for inviting me to testify at today's hearing.

    Mr. Tauzin. Thank you very much, Mr. DeVault.
    And finally, Mr. Ron Bruno, General Manager of WBGN-TV in 
Pittsburgh, Pennsylvania, who will supplement his testimony 
with some real interesting stories about Ron Klink.

                     STATEMENT OF RON BRUNO

    Mr. Bruno. Okay.
    Thank you, Mr. Chairman, and thank you, Members of 
Congress, for the opportunity to speak to you today. I 
especially would like to thank Congressman Klink and 
Congressman Norwood, and their hard-working staffs for being 
the lead co-sponsors of House Bill H.R. 486.
    I am Ron Bruno, as you just heard, president and co-owner 
of the Bruno-Goodworth Network, which operates and does 
business as WBGN-TV. My partner and co-owner is Ms. Debra 
Goodworth, one of the few women in this country that is a 
hands-on-owner of a television broadcast property. WBGN-TV is a 
group of 11 low-power stations that cover the demographic 
marketing areas of Pittsburgh and Wheeling-Stuebenville. We 
also own the FOX affiliate in Youngstown, Ohio, WYFX, channel 
62, a low-power television station.
    We began to design WBGN-TV in 1984, when we realized that 
there was a need for a television voice in the small 
communities that surround Pittsburgh. When we turned on our 
first station, we came out of the gates running. Today, our 11 
stations provide programming that fills the needs of small 
communities that our station serve. We produce a daily WBGN-TV 
regional highlight show that specifically examines an issue or 
event of interest to each particular community. We telecast 
local parades, local festivals, local affairs, and events that 
our community celebrate. By far, our most successful local 
programming is our award-winning high school, and college 
football and basketball coverage. The Pittsburgh Post Gazette 
called us a staple in western Pennsylvania high school 
athletics.
    This fall we will provide over 25 hours per week of local 
sports coverage. Mr. Chairman, when we cover a high school 
football game, it is no ordinary day for the kids and the 
communities who participate. We heavily promote the upcoming 
contest throughout the week on local radio, newspaper, cable 
TV, and our own station. Early in the morning on game day, we 
descend on a football field with productions trucks, support 
trucks, cranes, camera platforms, thousands of feet of cable, 
and a crew of 35 people. You only need to see the faces of the 
coaches and the players when they see all of this commotion 
being created over their team. They are dazed in wonderment and 
excitement that a television station is actually going to pay 
this much attention to their little community, and treat their 
team like they are in the Superbowl.
    One coach said to me that we are the best thing that 
happened to local high school athletics in as long as he could 
remember. This coach has been coaching for 35 years. Our games 
have become so popular that now our local high school athletic 
directors are petitioning our station to cover their games.
    In addition to all of this programming, we provide our 
community leaders with four--count them--four half-hour blocks 
of time each week to discuss critical government issues. We air 
5 hours per week of educational children's programming, where 
only three are required. We air 70 hours per week of national 
news; 15 hours per week of America's Voice Network, and 12 
hours per week of syndicated entertainment programming.
    We are the home of the Atlanta 10 Basketball Conference; 
the CIAA Basketball Conference; the Western Athletic Football, 
and Basketball Conference; the Mid-Atlantic Conference, and the 
North East Conference, and we are announcing this week that we 
are the television broadcast of the Pittsburgh River Hounds, a 
new soccer franchise coming to Pittsburgh. We fully comply with 
FCC, part 73, rules, even though we are not required to, and we 
look, act, and feel like any full-power station.
    The combination of digital television, public safety, and 
commercial spectrum allotments has resulted in a devastating 
blow to WBGN. We have been displaced on all 12 of our stations, 
including the FOX affiliate in Youngstown. FCC Chairman 
Kennard, with the help of staff members like Susan Fox, and Roy 
Stewart, and Keith Larson, and others, made giant steps in the 
6 reporting, in order to help LPTV stations find replacement 
channels. Unfortunately for us at WBGN-TV, at this writing, we 
have only been able to find displacement channels for 3 of our 
12 stations.
    Ms. Debra Goodworth and I are not wealthy people. We come 
from working-class families, and neither of us has a rich 
uncle. We have our life savings and financial futures at stake 
with these stations. Even if we can find replacement channels 
for each of these 12 stations, we may have to spend up to 
$100,000 per station to find new locations, and completely 
rebuild WBGN-TV. The banks simply will not lend me $1.2 million 
for a network of secondary stations. It does not make sense to 
spend this amount of money, only to know that we maybe replaced 
again, and again, and again.
    We had a reasonable expectation when we started in LPTV of 
what secondary meant, and what the risks were, but to go to a 
replacement channel without permanent status at this time would 
be financial suicide. Low-power stations simply need permanent 
status. If this legislation is passed, television viewers in 
western Pennsylvania, and across the country, will reap the 
rewards of securing community television in their area.
    H.R. 486 will give WBGN-TV the capability to continue to 
provide high-quality, local programming for all of its viewers. 
Our communities love our station; in fact, they call it their 
station. Sponsors pay to be on our station because the 
community watches our station. Local government officials 
communicate important local issues to the public through the 
use of our station.
    We have done our jobs as responsible broadcasters. Please, 
allow us a firm ground to operate on. Please pass H.R. 486. 
Thank you, Mr. Chairman, and the Members of Congress.
    [The prepared statement of Ron Bruno follows:]
  Prepared Statement of Ron Bruno, President, Bruno Goodworth Network 
                                  Inc.
    Thank you Chairman Tauzin and Members of Congress for the 
opportunity to speak to you today. I would especially like to thank 
Congressman Charlie Norwood of Georgia and Congressman Ron Klink of 
Pennsylvania and their hard working staff members for being the lead 
cosponsors of House Bill HR 486.
    I am Ron Bruno President and co-owner of The Bruno Goodworth 
Network Inc. which operates and does business as WBGN-TV. My partner 
and co-owner is Miss Debra Goodworth, one of the few women in this 
country that is a ``hands on'' owner of a television broadcast 
property.
    WBGN-TV is a group of eleven low power television stations that 
simulcast and cover the Demographic Marketing Areas of Pittsburgh and 
Wheeling Stuebenville. We also own the Fox affiliate in Youngstown, 
Ohio, WYFX, Channel 62 an LPTV station.
    WBGN-TV's group of eleven low power stations broadcast our 
programming from our main station in Pittsburgh whose signal is then 
repeated by our other ten stations. When conditions warrant, we can 
break away from the eleven station simulcast and individual stations 
can broadcast local news, information and entertainment specifically 
targeted to the communities that they serve.
    We began to design WBGN-TV in 1984 when we realized that there was 
a need for a television voice in the small communities that surround 
Pittsburgh. When we turned on our first station, we came out of the 
gates running.
    On our first hour of broadcast we were live with our grand opening 
ceremony from the small town of Beaver, PA (pop. 9,000) where we built 
our first station--Congressman Klink was our featured speaker. Later 
that night we covered the biggest local high school football game in 
the area. We had a total of four full hours of local community 
programming on our first day of broadcast. We haven't stopped since.
    Today our 11 stations provide local programming that fills the 
needs of the small communities that our stations serve. We produce a 
daily ``WGBN-TV Regional Highlight'' show that specifically examines an 
issue or event of interest to each particular community. We telecast 
local parades, festivals, fairs and events that our communities 
celebrate. By far, our most successful local program is our high school 
and college football and basketball coverage. The Pittsburgh Post 
Gazette called us a ``staple'' in Western Pennsylvania high school 
athletics. This fall we will provide over 25 hours per week of local 
sports coverage.
    When we cover a high school football game it is no ordinary day for 
the kids who participate. We heavily promote the upcoming contest 
throughout the week on local radio, newspaper and our station. Early 
morning on gameday we descend on the football field with a giant 
production truck, support trucks, cranes, camera platforms, 1000's of 
feet of cable and a crew of 35 people. You only need to see the faces 
of coaches and players when they see all of this commotion being 
created over their team. They are dazed in wonderment and excitement 
that a television station is actually going to pay this much attention 
to their community and treat their team like they are in the superbowl. 
One coach said to me that we are the best thing that happened to local 
high school athletics in as long as he could remember (this coach has 
been coaching for 35 years). Our games have become so popular that we 
now have high school athletic directors petitioning our station to 
cover their games.
    In addition to this programming we provide our community leaders 
with four half hour blocks of time each week to discuss critical 
government issues. We air five hours per week of educational children's 
programming, 70 hours per week of national news, 15 hours per week of 
America's Voice Network, and 12 hours per week of syndicated 
entertainment programming. We are the home of Atlantic 10 basketball, 
The CIAA conference, the WAC Conference, the Mid Continent Conference 
and the Northeast Conference. We are announcing this week that we are 
the television broadcast home of the Pittsburgh Riverhounds, a new 
soccer franchise coming to Pittsburgh. We fully comply with FCC Part 73 
rules. We look, act and feel like any full power station.
    The combination of DTV, Public Safety and Commercial spectrum 
allocations has resulted in a devastating blow to WBGN-TV. We have been 
displaced on all 12 of our stations including the Fox affiliate in 
Youngstown. FCC Chairman Bill Kennard with the help of staff members 
like Susan Fox, Roy Stewart, Keith Larsen and others made giant steps 
in the 6th report and order to help LPTV find replacement channels. 
Unfortunately for us at WBGN-TV, at this writing, we have only been 
able to find displacement channels for three of our stations.
    Miss Debra Goodworth and I are not wealthy people. We come from 
working class families and neither of us have a rich uncle. We have our 
life savings and financial future at stake with these stations. Even if 
we can find replacement channels for each of these 12 stations, we may 
have to spend up to $100,000 per station to find new locations and 
completely rebuild WBGN-TV. The bank will not lend me $1,200,000 for a 
network of ``secondary'' stations. It doesn't make sense to spend this 
amount of money only to know that we may be replaced again and again 
and again. We had reasonable expectations when we started in LPTV of 
what ``secondary'' meant and what the risks were--but to go to a 
replacement channel now without permanent status would be financial 
suicide. Low power stations simply need permanent status.
    The current laws seem to have abandoned the commitment made in 1981 
to thousands of LPTV entrepreneurs across the country. Most owners are 
not wealthy people, they are truly small businesses that just happen to 
be broadcasters. The current rules and regulations are threatening to 
eliminate an entire segment of the free ``over the air'' broadcast 
service. This is happening in favor of powerful conglomerates that are 
becoming further and further removed from the concept of community 
service that has been the hall mark of Broadcasting since the 
Communications Act of 1934.
    If this legislation is passed as written, television viewers in 
Western Pennsylvania and across the country will reap the rewards of 
securing community television in their area. H.R. 486 will give WBGN-TV 
the capability to continue to provide high quality local programming 
for all of its viewers. Our communities love our station--in fact they 
call it ``their station''. Sponsors pay to be on our station because 
the community watches our local programming. Local government officials 
communicate important local issues to the public through the use of our 
stations. We have done our jobs as responsible broadcasters. Please 
allow us firm ground to operate on--please pass H.R. 486.
    Thank you Mr. Chairman and members of congress for your time.

    Mr. Tauzin. Thank you very much.
    The Chair is also pleased to welcome Mr. Charlie Norwood of 
Georgia, who is not a member of this subcommittee, but the 
Chair will ask anonymous consent if Mr. Norwood could 
participate with us in these hearings. Without objection, so 
ordered.
    Welcome, Mr. Norwood. As one of the principal sponsors of 
the legislation, we are pleased to have you here, sir.
    Thank you all for your testimony. The Chair will recognize 
himself for a round of questions, and members in order of 
appearance.
    Let me, first, turn to you, Mr. Stewart. Is it likely that 
LPTV stations who are unable to find replacement channels may 
be required to cease operations?
    Mr. Stewart. To the extent that a LPTV station cannot find 
a replacement channel, there is a very good likelihood that 
they may very well have to cease operations.
    Mr. Tauzin. So, in the case of Mr. Bruno, where he has 
found replacement for only 3 of his 12 stations, is there a 
good likelihood that any, or most, of those stations will go 
dark?
    Mr. Stewart. Well, I would not want to say that without 
sitting down with Mr. Bruno, as we have in the past, and trying 
to work out some ability on the part of the Commission to 
accommodate the need, because I think the critical element here 
is to try to find a way to do the transition to digital 
television, which has a tremendous value for the American 
public, and at the same time continue to provide the service 
that these gentlemen are providing in their local communities.
    Mr. Tauzin. He makes a point, though, that even if you find 
him a replacement channel, he may get bumped again, and he 
cannot afford to. In fact, the banks will not give him $100,000 
every time it happens. How do we deal with that?
    Mr. Stewart. Well, I would like to see--we spent a lot of 
time, Mr. Chairman, on the table of allotments, and on the 
technical standards, and I am pretty much convinced that most 
of the American television stations are going to be able to 
replicate their service with no problem, and no real impact on 
low-power television stations. We got very few reconsideration 
petitions that adjusted the table as a result of the work that 
we had done. We have implemented the digital television in the 
major markets, and have not run afoul of concerns about impact.
    Mr. Tauzin. Let me turn it around then: If it is likely 
that they will not have to be replaced again, is the Commission 
considering permanent status for the placements you do find for 
Mr. Bruno's station?
    Mr. Stewart. Yes, I think the Commission has a petition 
before it, filed by the Community Broadcasters Association. The 
Chairman has expressed his interest in trying to classify low-
power stations with a Class A status, to give it permanency. He 
has asked the Commissioners to support that, and I expect that 
we will be acting soon on that petition, for rulemaking in a 
reasonably short period of time.
    Mr. Tauzin. Mr. Sullivan, you want to comment?
    Mr. Sullivan. I just wanted to add that the example that I 
gave earlier about the two Spanish language stations here in 
the District of Columbia, right now, I do not think either of 
them has found replacement channels. So, it means, with the 
advent of public safety, one goes away. When channel 5, the FOX 
affiliate, I believe here in the District, comes on, our 
channel 48 goes away, and the laws of physics allow only so 
much, and so we do have some hard spots, some unresolved 
issues. But then added to that--and that is what this 
legislation is really about--is for those, like in Akron, who 
are hanging on, so that they can spend their million dollars, 
provide the service to the couple of hundred thousand folks of 
that community, and not risk being knocked again.
    Mr. Tauzin. Mr. May, give me a short summary, your concern 
about doing that. What is your concern about legislation that 
would make permanent these placement slots?
    Mr. May. Mr. Chairman, I do not think we expressed as 
strong a concern about the permanency of a Class A license as 
we expressed a very real reservation about the timing of the 
creation of that license; what protections go with that license 
on an immediate basis, vis-a-vis the transition that is going 
to take place for digital. Remember, that it is great that we 
have got 57 channels on the air; it is great that we are going 
to have 4 times 30 more markets on the air by November of this 
year, but we have got 1,700 stations out there, and the vast 
majority of those are not even going to begin the process of 
building until the end of the year 2000 and 2001. And I do not 
think anybody on the dias, or sitting at this table, or at the 
Commission, can say with absolute certainty that every one of 
those assignments is going to work. We want to make sure that, 
if we have got this requirement to get the system up and 
operating, that the Commission and broadcasters have the 
flexibility to know that it is going to work seamlessly; and 
that we are not going to find that broadcasters have to go 
through some sort of a competing process with a newly minted 
Class A licensee. As we get to that point, the way that this 
bill is written, that could well be the case.
    Mr. Tauzin. React to that, Mr. Sullivan. My time has 
expired.
    Mr. Sullivan. Okay, I guess I would like to ask Mr. May if 
he believes there is any integrity in the 1,750 digital 
allotments that the Commission has given. You know, are most of 
these duds, or are a significant number of them duds, or are 
these really channels that have integrity, where we can have 
reasonable expectation that they are going to be working?
    Mr. May. And the answer to that is, we hope that these are 
good assignments, but I do not think any of us have that 
reality yet, because this is a brand-new system; this is one 
that is just getting off the ground.
    Mr. Tauzin. The time of the chairman has expired. I might 
point out that maybe in the legislation we may approach this 
with some sort of hold-harmless concept; we may want to talk 
about that.
    The Chair is pleased to recognize the gentlemen from 
Pennsylvania, Mr. Klink.
    Mr. Klink. Thank you, and I thank the witnesses. This has 
been an interesting discussion, and I want to kind of get this 
straight, though, because I understand, Mr. May, who has been a 
friend for a long time, I understand your point about your 
making this transition, and what is going to happen. But right 
now full-power stations have already been given their second 
channel digital allotments, my understanding; is that correct?
    Mr. May. That is accurate.
    Mr. Klink. A lot of low-power stations, as we have heard, 
have already been displaced; some of them have gone dark. Our 
bill now, as it is constructed--and it may not be perfect, as 
Mr. Tauzin has alluded to--we may have to look at some hold 
harmless. No bills go through very many subcommittees and 
committees that do not get changed somewhat, maybe a lot of 
times, but this bill would not do anything to change the table 
of digital allotments. All it would do is to provide some 
protection for the low-power stations from futures 
displacements. So that Mr. Bruno, or Mr. Stamler, or someone 
else can go to the bank, and say, ``We are for real. We are 
going to be here. We are not going to be displaced. If you lend 
us the money, we are going to make a capital investment in 
providing public service to the community.'' The bill would 
require these stations to then prove that they do not interfere 
with any other station, before they can be granted a Class A 
license. So, I am having a little difficulty in trying to 
figure out how that has an adverse impact on existing 
broadcasters.
    And, Mr. Stewart, I also was concerned about one of the 
comments that you made. I want to make sure that I understood 
it. You seemed to be concerned about the effect these 
assignments would have on additional analog channels that have 
applications pending, or maybe do not even have applications 
pending. My question there is, why should a potential full-
power station have preference over a station that is already at 
work in the community, providing public service?
    Mr. Stewart. Congressman, these applications have been 
pending for a while.
    Mr. Klink. They have been broadcasting for a while.
    Mr. Stewart. Okay, I think the question is then, it is a 
decision for Congress to make, when it makes a value judgment 
as to whether or not it is more important to keep on the air 
the kinds of stations that Congressman Deal was talking about 
in Georgia, that provide a real good service for their 
community, as opposed to providing opportunities for new full-
service broadcast stations. It is a trade that you have to 
make.
    As far as the other matter you raised, what I am saying is 
that I do not think, after all the effort we have put into that 
table and the technical standards, that we believe that there 
is going to be a lot of situations--we do not believe that 
there will be a lot of situations where we are going to have 
further impact of these DTV stations on the low-power stations. 
And what we should do is to put a safety net into this bill 
that enables the Commission, in those rare circumstances, to 
make any adjustments we deem appropriate to the low-power 
television service station, even if it is a Class A station. 
And that way, maybe we can go on, create the Class A service, 
give the Commission some flexibility to say in those few 
situations--and I cannot quantify them, but we do not think 
there is going to be a lot of them--that the Commission will 
have some ability to be able to make some adjustments in what 
we otherwise called a Class A station, perhaps changing its 
contours to some extent, so that we could go on and create this 
class, and the service it provides.
    Mr. Klink. Let me ask you a question. My time is probably 
running out. Could that adjustment that you are making, 
ultimately, still be a death sentence for one of these--I mean, 
what kind of adjustments are we talking about? If they are 
going to the bank, and there is still the ``sword of Damocles'' 
hanging over their head, how in the world are they going to be 
able to stay in business? How are they going to get capital to 
continue to expand their operations? They still have to make 
the transition to digital as well.
    Mr. Stewart. First, I do not think we will have a lot of 
situations like that, Congressman. And, second, I think, if we 
had that flexibility from the statute, we would try to do 
something that had the most diminutive impact on the operations 
of those stations in terms of their future viability. I mean, 
it may be adjusting their contour to make them pull back 
slightly. It might not be to take them off the air.
    Mr. Klink. Could we guarantee that in the language of the 
law, and the language of the regulation, so there was going to 
be in fact a diminutive----
    Mr. Stewart. I think we could work with the committee on 
determining what the appropriate language would be, to give the 
Commission the flexibility it might need in those limited 
circumstances, and still preserve most of the low-power 
television stations, and create the Class A status.
    Mr. Klink. Thank you, Mr. Stewart. Thank you.
    Mr. Tauzin. You wanted to react, Mr. Sullivan?
    Mr. Sullivan. Yes, I would like to respond to Mr. Klink's 
comments that I think CBA can work. In fact, we would be 
delighted to work with the committee in terms of developing 
some language that can be that safety net, because, one, I 
guess I like to think of the probability of problems maybe as 
the same as--there is a probability that those leaving the 
Longworth today will get hit by a car walking across 
Independence Avenue, but the probability is not such that the 
House administration locks the door, you know, on the Longworth 
Building to make sure that nobody gets hit.
    So, I think that is what we have to deal with, and in 
anticipation of this problem a little bit, I have developed 
some language that I would like to submit for the record for 
the committee today to consider. And we would be delighted to 
work with committee staff, and we would be delighted to work 
with Mr. May, and the FCC, in coming up with an acceptable 
safety net.
    Mr. Tauzin. Thank you very much. We are pleased to accept 
that suggestion, as well as any you might have in regard to how 
we might work that delicate of a situation.
    [The information referred to follows:]

    After certification of eligibility if unforseen technical 
problems arise requiring an engineering solution to a station' 
allotted parameters or channel assignments in the DTV Table of 
Allotments, the Commission is authorized to make such 
modification to ensure replication of the digital applicants 
service area as provided for in the Commission Regulations.

    Mr. Tauzin. The Chair is now pleased to welcome the 
gentleman from Georgia, Mr. Deal, for a line of questions.
    Mr. Deal. Thank you, Mr. Chairman.
    Could anyone on the panel give me some estimate as to how 
many low-power stations will be displaced with full-power 
stations moving to digital?
    Mr. Larson. Congressman, early studies in the DTV 
proceeding at the FCC had estimated that possibly as many as 35 
percent of the low-power stations in the country could possibly 
be displaced.
    Mr. Sullivan. That is consistent with our information, too.
    Mr. Deal. What contingencies, if any, does the FCC have to 
deal with that problem?
    Mr. Larson. The FCC has adopted a number of relief measures 
in the DTV proceeding, including providing opportunities for 
displaced stations to seek replacement channels on a non-
competitive basis, granting these kind of applications the 
highest priority among all of the low-power applications 
considered by the Commission. It also relaxed certain 
interference standards that it found to be overly restrictive, 
giving low-power stations more flexibility to find other 
channels; undertook a number of others measures, allowing low-
power stations, for example, to negotiate interference 
agreements among each other, and there were several others.
    Mr. Deal. Is it the language of the Telecom Act itself that 
restricts the channel allocations that the full-power can be 
assigned? In other words, why should the low-power folks be the 
ones that have to go out and look for alternatives? Is it the 
language of the telecom statute that gives the priority of 
displacing?
    Mr. Stewart. Yes, Congressman, the language is licensees 
and permitees at the time that we give out the authorization, 
and it was full-service licensees; it was not low-power. So 
there was a deliberately----
    Mr. Deal. No, you are missing my point, I think. I am 
talking about when they are now given another channel 
allocation for a digital broadcast.
    Mr. Stewart. Yes.
    Mr. Deal. Does the language of the Telecom Act itself 
prescribe the channel ranges that require the displacement of 
low-power?
    Mr. Stewart. No, that was left, I think, to the Commission 
to decide that.
    Mr. Deal. If that is the case, then, and you are telling a 
low-power station that is being displaced to go look for 
another allocation, if there is another allocation, why should 
that not be placed on the full-power station that is asking for 
the allocation, rather than the other way around?
    Mr. Stewart. Well, it was, first, the Congress did restrict 
the ability of the Commission to use all the frequencies. For 
example, the channels between 60 and 69 were taken from the 
Commission for mobile safety, and to be opened up for 
competitive bidding. So, we do not have that broad range. You 
are suggesting that maybe Congress meant to say that the 
broadcasters should have to vacate or find another channel 
themselves. I am not sure that I follow your question, 
Congressman.
    Mr. Deal. Well, as I understood, the answer I have received 
is that, if you are now looking for a digital allocation slot 
for a full-power station, they come and take the allocation of 
a low-power station--all right?--and it is given to them in a 
preferential assignment. I then asked what is going to happen 
to the low-power station. You said, ``Well, the low-power 
station can then go look for some other channel allocation.'' 
If that is the option, why is it that the low-power has to go 
look for it? Why should it not be the one who is asking in the 
first place, the full-power, be required to do so?
    Mr. Stewart. What we were trying to do was to make certain 
that, when we assign channels for digital television, and 
paired them to each present NTSC licensee, that we were able to 
get channels that would replicate in terms of the height and 
power the service area of the existing stations. So, that was 
what drove us to pair channels, and not say that the television 
licensee had to move someplace else. Well, we were looking at 
your channel. We tried to figure out, based upon the table that 
we developed and the technical parameters of that table, what 
channel could match, if operated by you, your present coverage 
area when you move to a DTV environment, and that restricted 
our ability in terms of who moves to what direction.
    Mr. Tauzin. I thank the gentleman. The Chair is now pleased 
to welcome the gentlelady, Ms. Cubin, for a line of questions.
    Mrs. Cubin. Thank you, Mr. Chairman.
    As most of you know, I am new on the committee, so I have 
some questions that may be very elementary. I want to start 
with Mr. Stewart. I believe, you said that approximately 35 
percent of the 2,100 low-powered TV stations will be displaced. 
And then you said, of that--so that is about 735 stations 
across the country--and then you said, of that, that very few, 
let me see, that there would be very few situations--describe 
what kind of----
    Mr. Stewart. Beyond that, Congresswoman, in other words, 
once we have made the initial assignment of licenses to pair 
channels, so that the existing broadcaster could transition to 
a digital channel, and then presumably return the channel that 
it is operating on now back to Congress, so that we can have 
auctions of that channel for various uses. Beyond the initial 
35 percent cut, where we have matching channels, and it 
affected low-power television stations, we do not think that 
there is going to be many more situations where we are going to 
find that there is going to be, to achieve the replication of 
service, where there is going to be a significant impact on 
more low-power television stations.
    Mrs. Cubin. Then 735?
    Mr. Stewart. Right, right.
    Mrs. Cubin. Tell me what you mean by significant impact.
    Mr. Stewart. Well, maybe I will learn not to use a word 
like this in the future.
    I mean, we do not think there will be enough of an impact; 
that if we put some kind of a safety net into this statute, 
which apparently Mr. Sullivan has suggested already, that we 
will not have to use it that many times, because we think that 
the table that we have developed and the technical parameters 
were designed to make certain that we have a smooth transition, 
from a technical point of view. I do not want to use the word 
``significant'' again, but I do not think that we envisioned 
that there would be a number of situations that would tie up my 
resources, having to figure out what kind of changes we would 
have to make.
    Mr. Larson. Let me add something to what Mr. Stewart said.
    Mrs. Cubin. Please do, because I was not thinking about 
asking about numbers. I was asking what significant impact is, 
going dark to having to change letterhead?
    Mr. Larson. A significant impact could be requiring a 
station to have to change its channel, because as some of the 
other witnesses have testified, that can be an expensive 
proposition.
    Mrs. Cubin. Right.
    Mr. Larson. Even more significant would be the possibility 
that some stations would have to cease operating. I would like 
to add, though, that there will be some low-power television 
stations that will survive the transition to DTV. That is, the 
impact of protecting, or being protected by these initial DTV 
broadcasters, only to be faced with the possibility of being 
displaced by yet a new entrant, or additional DTV stations, and 
that would be another level that they would have to be 
concerned about down the road.
    Mrs. Cubin. Mr. Bruno, or anyone else--Mr. Sullivan--who 
would like to answer it: I think that Mr. May makes a good 
point about the timing, that transition does not have to been 
done until 2002, and then the bands turn back 2006; and yet, 
this would take place relatively soon. Would you respond to 
that for me? To me, that is a legitimate point.
    Mr. Sullivan. So, you are suggesting basically that maybe 
we should consider----
    Mrs. Cubin. I am just saying, what do you think about that?
    Mr. Sullivan. What do I think about it? I think what it 
does is that it provides the opportunity for HTV in Houma, 
Louisiana to be displaced again, and again, and again. It 
provides that same opportunity in Mr. Norwood's district, in 
Mr. Deal's district, and in Laramie, Wyoming. Your station can 
be bumped again during that timeframe, and when you do $100,000 
a pop on these low-power stations, and how many times can they 
handle being displaced; or why can not they develop the way 
they should in Akron, Ohio? Again, a half a million population, 
I mean, I should say, half a congressional district population 
in Akron.
    Mrs. Cubin. Mr. Chairman, I see my time is up, but I just 
have one question. What was the safety net language that you 
offered for the record?
    Mr. Sullivan. Well, it is probably more garbled than 
lawyers would like.
    Mrs. Cubin. Then just give me the simple English.
    Mr. Sullivan. What it does basically is, in the FCC 
testimony, they talked about these unforeseen problems, and I 
think that is a keyword. Right now they believe there is 
integrity in the allotments. The NAB believes there is less 
integrity, I think--is this correct, Jim?--than the FCC would 
be inclined. So, what we want to do is where, if there are some 
serious engineering problems that develop within the allotment 
of any of the 1,750 allocations that have been made, that it 
would provide the flexibility to the Commission to make what 
change was necessary to make sure that the broadcaster could 
equal 100 percent of the replication with their DTV channel, 
100 percent of the replication of the operating NTSC channel.
    Mrs. Cubin. So, you cannot see any room for compromise on 
the timing aspect?
    Mr. Sullivan. I think, no. I think that we would have to 
oppose that, and oppose that very vigorously, because if we 
have this kind of safety net language in there, the Commission 
has that flexibility to correct the problem for 1, 5, or 50 
stations, and we do not have to put the entire low-power 
industry on hold----
    Mrs. Cubin. Thank you, Mr. Sullivan.
    Mr. Sullivan. [continuing] facing the risks of these 
additional displacements.
    Mrs. Cubin. Thank you.
    Mr. Tauzin. I thank the gentlelady. The Chair is now 
pleased to recognize our guest. Charlie, the rules of the House 
require that guests go last, so this was not personal. If it is 
any consolation, Mr. Stamler and his wife went 3 years without 
a paycheck, putting their station together. It was a lot easier 
on you, Mr. Norwood.
    Mr. Norwood. Mr. Chairman, I certainly do abide by the 
rules. I am just grateful that you allowed me to have an 
opportunity to come before your fine committee.
    Mr. Tauzin. We are glad to have you.
    Mr. Norwood. Mr. Stewart, you have read over H.R. 486?
    Mr. Stewart. Yes.
    Mr. Norwood. You understand what we are trying get at 
there?
    Mr. Stewart. Yes.
    Mr. Norwood. Is there anything in the law today that would 
prevent you from taking care of this problem without us passing 
this bill?
    Mr. Stewart. I think there is a petition before the 
Commission, filed by the Community Broadcasters Association. My 
Bureau is actively involved in working with the Commissioners 
on the content of the Notice of Proposed Rulemaking, raising a 
lot of the issues we have been talking about. What is the 
effect down the road, if you want to auction off this digital 
spectrum, and provide money to the Treasury, in terms of its 
impact on any Class A stations that are provided for?
    Mr. Norwood. Can you fix the problem without us passing 
this bill?
    Mr. Stewart. I would like the opportunity to try.
    Mr. Norwood. Any reason you think you could not?
    Mr. Stewart. The Commission is a congenial body, and it has 
to work together, and I would hope that we would be able to do 
that. The Chairman has certainly encouraged the Commissioners 
to seek--to adopt rules that would provide this type of Class A 
protection.
    Mr. Norwood. Can you adapt rules before 2002? Well, some 
folks can around here cannot.
    Mr. Stewart. I am sorry?
    Mr. Tauzin. I think he wants to know if you are a high-
powered or low-powered Commission.
    Mr. Norwood. I want to know if you can fix the problem, or 
if you are willing to fix the problem, and if so, how soon?
    Mr. Stewart. Well, I would hope that the Commission will 
act reasonably soon. The Chairman said he would like to do it 
as soon as possible. He has encouraged the Commissioners to do 
it. The Bureau is working with the Commission now. There are, 
in fairness, a whole host of issues that we have not explored 
this afternoon, sitting here; we have only talked about 
replication of digital television signals, and the impact on 
low-power Class A. There are these future applications, and 
what happens to them. I think that we can do it. I think the 
Chairman would like the opportunity to do it, and, I would----
    Mr. Norwood. Does it speed you up any as we get more co-
sponsors?
    Mr. Stewart. I think the answer to that is yes.
    Mr. Norwood. Well, Mr. Sullivan, part of the problem, as I 
understand it is, has to do with financing of low-power, and I 
certainly can understand, and have been explained to very 
clearly in my district, about low-power, how it is an untenable 
situation for you to try to run a small business--one, by the 
way, that brings a lot of jobs in our districts; that many 
communities in our district appreciate what you do very much. 
It is not that we do not want to watch Mr. May's stations; we 
do, but we appreciate those things that you do, too. But it is 
so hard for you to grow and get better, because the bankers do 
what?
    Mr. Sullivan. What do the bankers do? I think the president 
of our association, Sherwin Grossman, stated it best as he both 
developed a number of television stations as well as chartered 
a series of banks, and he made a comment 1 day that, if he had 
a loan officer that would loan, make a loan to a low-power 
station, he would fire him on the spot.
    Mr. Norwood. Because he----
    Mr. Sullivan. Because--probably because--he knew that the 
bank examiner would close his door next time the bank examiner 
came, when he saw that loan.
    Mr. Norwood. You mean, you are not a good investment 
because the Federal Government may take your business out from 
under you tomorrow? Is that what that means?
    Mr. Sullivan. Oh, it can take it out tomorrow, but, again, 
can take it out repeatedly. I mean, Mr. Oxley's constituents 
just paid $75,000 to $100,000 to re-channel FOX 67 out down to 
FOX 25. That part of the country is--which is not that far from 
Mr. Sawyer's area--really spectrum scarce now. You get bumped 
in that area, and the probability of finding another channel is 
really very, very limited.
    Mr. Norwood. That is why we cannot wait to 2002; we need to 
get it done by summer, if we can.
    Mr. Stewart. I will convey that message to the Chairman, as 
I am sure the chairman of the subcommittee will, also.
    Mr. Norwood. Mr. May, you go co-sponsoring our bill yet?
    Mr. May. Mr. Norwood, I do not think we will see our names 
on there as co-sponsors of you legislation, but I----
    Mr. Norwood. But you will get by all right if we pass it, 
will you not?
    Mr. May. Well, sir, I think we would like to see some 
changes made to it, or changes made to what the Commission is 
considering. You know, I might want to go so far out on a limb 
as to suggest that a lot of this would not be a problem. I 
think Mr. Sullivan, Mr. DeVault, and Dr. Stamler, and others, 
would agree, if the Congress in its rush to generate a whole 
lot of cash had not tried to auction off 67 to 69, then a lot 
of this would not be even a problem today.
    Mr. Norwood. Mr. Chairman, I see the red light, and I will 
certainly abide by that, but I am very grateful to you for 
giving me a few minutes. I have a few other questions, if I 
could submit in writing?
    Mr. Tauzin. Not a problem.
    Mr. Norwood. Thank you, sir, and one of them is, how do you 
spell ``Kasich?''
    Mr. Tauzin. The gentleman from New York, Mr. Vito Fossella, 
is here. Line of questions for you?
    Mr. Fossella. No, Mr. Chairman.
    Mr. Tauzin. Thank you for coming, Vito.
    Mr. Bruno wanted to respond.
    Mr. Bruno. I would just like to try to explain a practical 
situation with our 12 TV stations--to kind of put this into 
perspective, what I may have to go through from now to the year 
2002. For me to go out and get a $1.2 million loan to replace 
all of my 12 television stations puts me out of about $20,000 a 
month on loan over 5 years. The year 2002 is only assuming that 
I have $20,000 of profit, which I do not, that I can invest in 
that debt service. If I get bumped between now and the year 
2002 again, and who knows how many times that would be, that 
would be another $20,000 per month; we are up to $40,000. If I 
get bumped a second time, that I have to take from profits of 
our station, which I certainly do not make $40,000 a month of 
profit, to pay off that debt service, because I keep getting 
bumped around.
    So in a practical sense, the bank says no to me, ``Ron 
Bruno, you get permanent, and then we will give you the money, 
but until you are permanent, forget it.''
    Mr. Tauzin. Of course, the question was for us, if you do 
get permanent, can you get those loans?
    Mr. Bruno. I believe if we are permanent, we can get a 
combination of loan and investment, and continue.
    Mr. Stamler. Mr. Chairman, about 10 years ago, we invited 
the low-power television branch to visit our television station 
in Woodstock, which I say is about 1\1/2\ hours west of 
Washington, DC.
    Mr. Tauzin. That is not the Woodstock of----
    Mr. Stamler. Not at all. They are not the same.
    Mr. Tauzin. That is the one off of Interstate 81.
    Mr. Stamler. That is the one. I would like to extend that 
same invitation to the subcommittee, to come and see what a 
working low-power television station looks like. A lot of you 
people probably have never been there. Your committee and its 
staff, you are more than welcome to come up and see that we are 
real.
    Mr. Tauzin. That is very kind of you. I want you to know 
that I have been in low-power stations, and actually 
participated in some programming there. So I am well acquainted 
with it. Mr. Sullivan has made sure that we are well acquainted 
with our low-power stations at home.
    Mr. Sullivan. Mr. Chairman, I understand that you have even 
done some Cajun cooking on HTV?
    Mr. Tauzin. Much to my shame, I have.
    Mr. Sullivan. Mr. Chairman, but the constituents love it.
    Mr. Tauzin. Mr. Norwood.
    Mr. Norwood. I cannot help but note or tell Mr. Stamler, if 
we have anything to do with it, if we are going to check out a 
low-power station, it is going to be in either Louisiana or 
Georgia; I can tell you that right now.
    Mr. Tauzin. I want to get a couple of responses before we 
wrap up. Mr. Stewart asked us to focus on three sections of the 
bill: one dealing with the protections from interference. None 
of you responded to that. I would like to get a response to any 
of his concerns. What exactly is your concern there, Mr. 
Stewart?
    Mr. Stewart. Well, the statute would provide that the 
protection of the contours of the Class A stations would come 
in a very early period of time, while we still have 
applications pending for new stations, while we have not 
finished the replication applications for digital television 
being filed. And the concern that we have, we are not sure what 
the impact may be. We do not think it is going to be 
significant, but that raises this idea of putting in some kind 
of a safety net, so we can deal with these situations, if they 
arise, because the language in the statute is rather 
categorical.
    Mr. Tauzin. Yes, so the question is, if I can summarize, in 
the section of a bill that provides for interference 
protection, is it possible to have some sort of safety net 
protection, as some of the Commission's decisions come down? 
And I just ask you to think about that and respond to us, 
either now or in writing.
    Mr. Sullivan. Okay, we are fully prepared to make a 
combination as a safety net, to make sure that we can do 
everything possible to preserve the integrity of the 1,750 
digital allotments. You know, digital, everybody wants digital 
to work; we want it to work.
    Mr. Tauzin. I think I heard that rather clearly, but we 
need to see in language what might accomplish that.
    Second, the Commission indicated that they were concerned 
that section 3(b) precludes the FCC from using competitive 
bidding to select among competing Class A designation 
applications. We have been through comparative license renewals 
and comparative license processes, and I think the FCC is 
probably still in court over a lot of those. We got away from 
that and went to competitive bidding, in order to literally get 
away from the green mailing, and the lawsuits, and everything 
else, that were literally associated with that process. I do 
not want to go back to it, frankly. I do not think anybody in 
this Commission--I know the vice chairman, Mr. Oxley, was very 
instrumental in the bidding process, the auction process; would 
be very apposed to going back to it.
    What is your answer? Why is that in the bill, and how do 
you resolve it, if you take that out of the bill? If it is not 
a bidding process, how do you settle competing applications?
    Mr. Sullivan. Well, we agree with the FCC that maybe the 
provision that is in the bill, that Mr. Norwood agreed to add, 
is not perfect, and needs to be looked at, but it is not a 
happy day when you can put 2 or 3 broadcasters head to head 
against one another who are secondary status.
    Mr. Tauzin. Well, think of----
    Mr. Sullivan. You know, so how much are they inclined to 
bid, when they do not know if a week down the road after they 
win the bidding, and pay the money, that they are even going to 
continue to hold the channel.
    Mr. Tauzin. If you are going to get a Class A permanent 
license, it may be worth bidding for, but the bottom line is 
that we need some resolution of this. To leave it with no 
bidding process, and no resolution of how to settle it, is not 
going to be acceptable, and I would suggest that all the 
parties be thinking about a respectable solution before we move 
legislation.
    Mr. Sullivan. Okay.
    Mr. Tauzin. Let me turn to the third concern that the FCC 
has raised, and that is, that it exempts Class A stations from 
ownership rules that apply to full-service stations. Now, let 
me be candid, Mr. Stewart, I am not particularly enamored of 
the ownership rules at the FCC. And, as you know, I have 
petitioned the FCC personally, and a lot of other members, to 
strongly consider revising those rules, and rapidly, at least 
within the biennial review process required by law to do so. Is 
there a message there? I hope so.
    Mr. Stewart. I heard it.
    Mr. Tauzin. In any respect, his concern is, if there is a 
rule, shouldn't it apply equally to Class A stations, as to 
full-service stations? Would you please respond?
    Mr. Sullivan. Yes. We are different from full-power in the 
sense that we are local, community broadcasters, as opposed to 
regional or big market broadcasters, and this was in the bill 
primarily----
    Mr. Tauzin. But let me stop you. If you have got a 
permanent license, you become something else.
    Mr. Sullivan. Oh, I understand, but we are still----
    Mr. Tauzin. If you get a permanent license, should not you 
be subject to the same rules as the other permanent license-
holders in the community? Why not?
    Mr. DeVault, you have got them both. Please tell me, what 
is the difference?
    Mr. DeVault. I would say, why not--because the low-power 
station has now, and would continue to have, much more limited 
coverage than the full-power station.
    Mr. Tauzin. But, what has this got to do with the purpose 
of, and the continuation of, these ownership restrictions? You 
understand, I have problems justifying the continuation of 
these ownerships personally----
    Mr. DeVault. I know you do.
    Mr. Tauzin. But if you have got to have them, and if they 
exist, why shouldn't they apply to someone with a broader 
coverage as opposed to someone with smaller coverage? After 
all, they apply to stations in Lafayette and New York 
simultaneously. I suspect a broader coverage is in New York 
than in Lafayette, Louisiana. What is the difference here?
    Mr. DeVault. I think if more full-power stations had looked 
to the possibility of developing low-power stations to serve 
there in close communities, instead of trying to lease out, or 
whatever, someone else's full-service television station, we 
probably would not be fighting this battle today.
    Mr. Tauzin. I haven't heard a good answer yet, but I want 
you to keep thinking about it, and come back to me because I 
need a good answer here.
    Mr. DeVault. Okay.
    Mr. Tauzin. Mr. Stamler.
    Mr. Stamler. Mr. Chairman, we are Shenandoah County, which 
is a lengthy county that requires four channels to cover it. If 
we were restricted to only one channel in ownership for 
Shenandoah County, we could not do it.
    Mr. Tauzin. Mr. Stewart.
    Mr. Stewart. We do not have any restrictions now. You can 
own seven low-power stations in your city, and a TV station, a 
full-service TV station, can own you. But if we elevate you to 
something other than a secondary service, then the concern we 
might have is that a full-service television station may buy 
you, and we lose the localism that you had. They will control 
your programming, and normally we would not let you own--and I 
will say this quietly, Mr. Chairman--two TV's in the same city.
    Mr. Tauzin. Oh, God forbid.
    Mr. Stewart. But, so that is the concern that I am looking 
at, that if you get elevated to a new class, that a full-
service licensee then could own this elevated new class, unlike 
its ability to own a secondary service that may get knocked off 
the air; and a new class that is going have all the 
responsibilities, hopefully, that a full-service television 
station had, so that you can get the recognition there.
    Mr. Tauzin. Let me just jump in here and tell you, we have 
the same problem in financial institutions. You know, we got a 
law that tried to separate security businesses from banking 
businesses, and the marketplace began to merge the two, and now 
we made special classes out of one and the other, and some 
became special targets of acquisition. The point Mr. Stewart is 
making is, are you are going to become special targets of 
acquisition, as a full license operator, by a full-power 
station, because owning you is a way to avoid the ownership 
rules that they might have if they bought any other station? 
Mr. DeVault?
    Mr. DeVault. Well, as I understand it, and I pointed out in 
my testimony, the requirements for local program origination 
that are in this bill for local low-power stations that are 
seeking Class A status are requirements that do not even apply 
to full-service stations. And if a low-power station gained 
Class A status, it is my understanding that station would have 
to continue to comply with that requirement on into the future. 
It couldn't just gain the status, and then stop doing the local 
programming.
    Mr. Tauzin. Mr. Norwood wanted to jump in here.
    Mr. Norwood. Well, I just wanted to make a point that there 
are restrictions on low-power now that are not on full-power. I 
wonder, if Mr. May wants to buy any low-power stations--I do 
not think there is any reason they cannot own them, if they 
want to.
    But back to you, Mr. Stewart, the perfect----
    Mr. Tauzin. I have got to jump in here. You had made Mr. 
May both a Member of Congress and now a television station 
owner, which I am not sure you really want----go ahead.
    Mr. Norwood. Well, you have got my meaning.
    Mr. Stewart, the purpose of the ownership restrictions is 
for what?
    Mr. Stewart. To encourage diversity of ownership and view 
point in the community, and to make certain that there is a 
competitive balance in the community in terms of not being able 
to dominate the advertising market. The Commission's ownership 
rule----
    Mr. Norwood. You do not want any media monopolies out 
there?
    Mr. Stewart. That is correct, sir.
    Mr. Norwood. And, I do not know, what you mean by 
diversity. What does that mean?
    Mr. Stewart. Well, the theory would be that the--here I go 
again, Mr. Chairman--that the widest dissemination of ownership 
in terms of a community may provide the opportunity for 
divergent viewpoints. So that the more ownership sources you 
have, or programming sources in terms of stations, if you have 
separately owned stations, you have more of a chance of having 
more diversity of viewpoint. And if the full-service station 
can buy out its competition by buying that new Class A low-
power television station, I am not sure that is good for the 
community. I do not know what the full-service station might do 
to Doug Jensen's Class A station, once it buys it, if Doug lets 
it go. You might lose something about its talent that it has 
when Doug has it----
    Mr. Norwood. You aren't worried about monopolies in low-
power, though, are you?
    Mr. Stewart. No.
    Mr. Norwood. Are you concerned that any of these men may 
cover 8 counties rather than 2?
    Mr. Stewart. You can own as many low-power television 
stations--there is no national limit. You can own as many 
locally. But once we elevate it to something different, that 
makes it like a full-service station, then I think there maybe 
some value in looking at the ownership rules and saying, wait a 
minute, we do not want the television stations in the city to 
buy all these new Class A stations up, and perhaps change what 
they do in terms of the programming.
    Mr. Norwood. Mr. Chairman, you got it right. Rather than us 
raising the threshold of ownership rules for low-power, why do 
not we go in there and lower the threshold for ownership rules 
for full-power, and we might get this thing a little balanced?
    Mr. Tauzin. In fact, Mr. Norwood, we will have this another 
day, but I would love to know, Mr. Stewart, why it is that 
cable companies can consolidate in communities? There used to 
be 3, 4, or 5 cable companies in Los Angeles, and it is 
gradually becoming just one. And as they are consolidating, 
buying out each other in each other's community, and becoming a 
bigger market power and a single voice in the community for 
advertisers, why is that permitted, and why are television 
stations subject to these ownership rules? We will get to that 
discussion 1 day, but solving that riddle might help us solve 
Mr. Norwood's riddle of equal treatment to the low-power 
stations.
    It has been a very good hearing. Let me thank you, Mr. 
Norwood. Thank you for participating.
    I would thank the panelists. I have asked you to respond to 
us with more information and suggestions. Please don't miss 
that opportunity. Before we go forward with this bill, I would 
like to examine whether some of the real concerns Mr. Stewart 
has raised, Mr. May has raised, regarding the timing, and the 
concerns you have raised regarding financing, if there is not 
someway to accommodate all those concerns simultaneously. As 
you know, that is always our wish. We do not like to pick 
winners and losers out there. We would like see everybody 
flourish in this marketplace, if possible.
    Thank you very much for your attention and you 
contributions. The hearing stands adjourned.
    [Whereupon, at 4.02 p.m. the subcommittee was adjourned.]
    [Additional material submitted for the record follows:]

                         Community Broadcasters Association
                                                     April 15, 1999
Honorable Billy Tauzin
Chairman
Subcommittee on Telecommunications, Trade and Commerce
2125 Rayburn House Office Building
Washington, D.C. 20510
    Dear Mr. Chairman: We are grateful for the opportunity to 
participate in your April 13 hearing on the Regulatory Status of Low 
Power Television Licenses. It helped us get a better sense of issues of 
importance to you and your colleagues on the Subcommittee. We also 
found it very helpful to be at the same table with spokesmen from the 
Commission and NAB. At the end of the hearing you asked that we respond 
to the four concerns raised by the FCC in their testimony. We are 
pleased to have the opportunity to do that. We will discuss them in the 
order they appeared on pages 7-9 of their testimony.
    1. Beginning on page 7, the Commission expressed concern that class 
A status could constrain them from ``authorizing new analog television 
service for which applications are pending.''
    CBA would like to share with the Subcommittee our understanding of 
this issue. While rumors were in the air for approximately six months 
before any official statement, in June 1996, the Commission announced 
that as of September 20, 1996, it would not accept further applications 
for full power analog stations. It is our understanding that during 
this ten month period, a significant majority of the estimated 800 
applications were filed for these new full power analog stations. Since 
many of the applicants filed for the same or conflicting channels, the 
total number of planned new grants is approximately 300. The Commission 
has already granted some of these new assignments, with the result of 
displacing low power stations in their communities of service.
    If the Congress would choose to give priority to these new 
applicants, over existing class A eligible stations, this puts at risk 
all the community stations, plus many others, that CBA discussed in 
their testimony before the Subcommittee. We agree completely with Mr. 
Deal's assessment of this issue. He asked the FCC spokesman, if he were 
being asked to choose between his local station in Dalton versus a 
pending application, whose programming and commitment to the community 
he knew nothing about''?
    Many of the class A eligible stations have investments in the 
hundreds of thousands of dollars, some more than a million dollars in 
their community based stations. These investments and their commitment 
to their communities came well before the hugely significant DTV, 
public safety and commercial spectrum reallocation decision of the mid-
1990s. The ``last opportunity'' rush for analog stations came after 
most of these investments. The engineering and legal costs associated 
with these applications are minuscule in comparison to those of the 
class A eligible operating stations.
    In a July 27, 1998 letter to Senator Ford and others on the Senate 
Commerce Committee, Chairman Kennard concluded a discussion on this 
issue with the statement, ``I note this issue for your consideration.'' 
He included no recommendation to the Senate Commerce Committee. CBA 
believes that this is a public policy not regulatory issue. We believe 
it's not only within the purview of the Congress but one that needs to 
be decided by the Congress. The outcome of this issue is of critical 
importance to prospective class A licensees and their unserved and 
underserved communities throughout the United States.
    2. The Commission also expressed concern that there is insufficient 
flexibility in H.R. 496 to address future, unforeseen engineering 
problems that may arise during the digital transition.
    Subcommittee members and panelists discussed this problem at some 
length and suggested the addition of some type of ``safety net'' 
provision that would provide needed flexibility. CBA can support a 
safety net concept but wants to be certain that its use is limited to 
documented, engineering problems that need resolution to ensure 
utilization of replicated allotments. CBA proposes the following 
modification to H.R. 486:
    At the end of Sec. (f)(1) add the following--
    ``If after granting certification of eligibility or a class A 
license, unforeseen technical problems arise requiring an engineering 
solution to a station's allotted parameters or channel assignment in 
the digital television Table of Allotments, the Commission is 
authorized to make such modifications, as necessary, to ensure 
replication of the digital television applicant's service area, as 
provided for in 47 CFR Sec. 622.''
    3. The Commission also expressed significant concern about a 
proposed amendment to the auction authority contained in Sec. 309(j)(2) 
of the Communication's Act. The Commission properly characterized this 
amendment stating that it would ``prevent the FCC from using 
competitive bidding in deciding among mutually exclusive applications 
where one or more of the applicants is a qualified class A licensee or 
a translator service rebroadcasting the signal of a primary service 
station within its designated market area.''
    CBA is sympathetic to these concerns and is prepared to seek 
alternative solutions with the Subcommittee and the Commission. But we 
want to emphasize that there is a real problem that needs a solution.
    In the first three months of the Commission's 1998 Displacement 
Relief program for low power broadcasters and translator stations, the 
Commission received more than 1,200 applications for new channel 
assignments. Approximately, 300 of these applications were mutually 
exclusive. Applicants were notified and a few found engineering 
solutions which were most commonly alternative channel assignments. 
Many remain unresolved due to the scarcity of spectrum available after 
the DTV, public safety and commercial allocations.
    Providing local television service to unservered and underserved 
rural and urban communities is the cornerstone of this legislation. In 
those communities, and there are many, where there is insufficient 
spectrum available to accommodate multiple displacement applications, 
choices have to be made. CBA struggles with the concept that the 
deepest pockets determine the outcome. The practical reality is that 
some of the displaced stations are those who are providing significant 
levels of local programming in their markets and doing just what this 
legislation is seeking to encourage and preserve. Some others serve as 
translators rebroadcasting distant signals. In many instances, the 
translators carrying the distant signals are part of larger operations, 
whose financial capabilities far exceed those of the local 
broadcasters.
    The end result of an auction is known before it begins. The low 
power broadcaster is frequently offered some small compensation to go 
away. This is usually accepted because the local service licensee knows 
there is no chance of victory in an auction. This removes the need for 
an auction. The government never realizes its revenue objectives. And 
most importantly, another local broadcaster has disappeared from an 
underserved community. While we know that is not the purpose of the 
auction authority, CBA believes the Congress must reconcile these 
market place realities for low power broadcast stations with statutory 
directives.
    CBA can accept that the provision in H.R. 486 may need some 
revision. However, we remain deeply committed to finding a solution 
better than what is currently available in Sec. 309(j) of the 
Communications Act.
    4. The Commission also expressed concern with Sec. (f)(3) ``common 
ownership'' provisions of this legislation. This concern is based on 
the possibility that full power television licensees might acquire low 
power stations as second outlets in their markets, where they are 
precluded from owning two full power stations. This has the effect of 
eliminating the benefits of ownership diversity, and local ownership 
and management participation that mark the low power industry today.
    While acquisition of low power stations in the same market could be 
of concern, ownership of other media that generate cash flow or provide 
an asset to serve as security for financing has been an important 
element in making possible the establishment of some of the most 
prominent locally-owned low power stations that provide extensive local 
service today. CBA strongly believes that these stations should not be 
precluded from receiving the benefits of class A status.
    To avoid areas of future concern, while not depriving existing 
stations of the benefit of this legislation, CBA proposes that Sec. 
(f)(3) be modified as follows (italic portion is added):
    (3) COMMON OWNERSHIP--No low power television station, authorized 
as of the effective date of this Act, shall be disqualified for a class 
A license based on common ownership with any other medium of mass 
communications.
    Thank you for this opportunity to provide additional information. 
If you have any questions or need further information, please call me 
or Mike Sullivan.
            Sincerely,
                                           Sherwin Grossman
                                                     President, CBA
cc: Chairman Tom Bliley
   Congressman John Dingell
   Congressman Ed Markey
   Congressman Charlie Norwood
   Congressman Ron Klink
                                 ______
                                 
     National Association of Broadcasters Responses for the Record
    Question: You suggest in Talking Points to State Associations that 
``Crowding LPTV stations into a limited number of vacant channels would 
create greater interference for both analog and digital television 
receivers.''
    Aren't there two things wrong with this statement:
    a) I thought Section 7 of this legislation precludes the FCC from 
granting any Class A licenses that would create interference for either 
analog or DTV stations. Isn't that correct?
    b) If they are vacant, can't LPTV apply for these and use them 
whether they are Class A, or not Class A? As I understand this 
legislation, it's not about using vacant channels but about securing 
channels so that Class A broadcasters can make the necessary investment 
to operate these stations. What do I misunderstand?
    c) If there is crowding, this bill doesn't change a thing about 
current LPTV regulations, allowing the FCC to move or cancel any LPTV 
license that poses a problem.
    Answer: a) Talking Point sheet addressed the original ``Community 
Broadcasting Protection Act of 1997'' (S. 1427) as introduced on 
November 7, 1997. The original incarnation of the bill did not appear 
to provide any interference protection at all. On October 12, 1998, 
Senator McCain introduced an amendment to S. 1427 that effectively 
struck the prior language and substituted new language that included a 
``no interference'' section. That language appears virtually verbatim 
in H.R. 486.
    However, the ``no interference'' language does not provide 
interference protection to NTSC stations that may have applications for 
modifications that are pending at the Commission and to DTV stations 
that have applied for service area modifications. We addressed this in 
written testimony for the Low Power Television Hearing as our fourth 
point of concerns regarding the current legislation.
    Further, regardless whether the bill now precludes interference 
from Class A licenses in some instances, the statement itself is a true 
statement. By placing LPTV stations in vacant channels, whether by 
desire or necessity to avoid displacement, interference can result to 
the existing stations and potentially to the digital stations yet to be 
built. It is a matter of physics.
    b) One of the major problems with the legislation is that it would 
allow the ``securing'' of channels by LPTV stations before the DTV 
transition is completed. As drafted, the legislation would provide 
primary status to qualified LPTV stations and without the proper 
protections to existing NTSC TV stations and unbuilt DTV stations. 
Currently, there may be NTSC stations with pending modification 
applications. Also, there is a need to keep as much flexibility as 
possible for DTV stations if there should be a need for adjustments 
during the transition. It is not logical to threaten the DTV transition 
before it has a chance to get off the ground.
    c) The LPTV rules and regulations have always imposed a secondary 
status on LPTV stations. This bill would change this status--by 
providing LPTV stations with primary spectrum use. The FCC, during the 
DTV proceeding, has tried to take into account the concerns of LPTV 
stations. Unfortunately, until full service DTV stations are 
substantially settled, there is simply not enough flexibility to 
accommodate LPTV stations and even TV translators.
    Question: You state in many written documents that this legislation 
goes against the initial FCC ruling that established LPTV stations? You 
say, correctly, that LPTV owners knew that their licenses were 
temporary and could be revoked at any time. Is this a correct 
assessment of your position?
    If so, please explain this as justification for the Congress not to 
reconsider creating a new class of licenses as H.R. 486 does. Because, 
as I see it, the stations that would qualify for Class A licenses under 
this bill would have program requirements that are even more stringent 
than the ones placed on your members. To qualify for a license under 
H.R. 486, low-power stations would have to broadcast at least 18 hours 
a day and broadcast at least 3 hours of local programming.
    Can all of your members meet this requirement? If not, why would 
you object to creating a new class of licenses for stations that do, 
especially considering the service, jobs and revenue these stations 
provide to local communities?
    Answer: NAB opposes the establishment of a new class of TV licenses 
that would harm the transition to DTV. At this time, it would be unwise 
to provide primary status to LPTV stations--even if they meet the 
qualifications in the legislation. Congress has set a national policy 
that America's TV stations will transition to digital broadcasting, and 
the vast majority of stations will do so by 2002--as long as nothing 
impedes this process. LPTV stations have always been a secondary 
service. Although many LPTV stations may provide an important service 
to their viewers, the fact remains that it is the full service TV 
stations that consumers depend on. Now is not the time to place 
roadblocks in the way of the DTV transition. Once the DTV dust settles, 
the FCC can determine how best to accommodate the LPTV stations.
                                 ______
                                 
                                                    WAPK-TV
                                                       May 11, 1999
W.J. ``Billy'' Tauzin
Chairman
Subcommittee on Telecommunications, Trade and Consumer Protection
U.S. House of Representatives
Committee on Commerce
Room 2125
Rayburn House Office Building
Washington, DC 20515-6115
    Dear Chairman Tauzin: I want to again thank you for inviting me to 
testify before the Subcommittee on April 13 on the subject of the 
Regulatory Classification of Low Power Television Licensees. It was a 
pleasure to discuss our company's experiences with its WAPK-LP ``UPN/
30.'' As I stated in verbally supplementing my written testimony, when 
I wrote that testimony I was unaware that in some thirty-four TV 
markets around the U.S., the UPN affiliate is an LPTV operation rather 
than a full power station!
    Following our initial testimony you invited each witness to send to 
you any supplemental comments. Mine are presented herewith.
    Perhaps the greatest surprise to me in the subject hearings was the 
inclusion in the testimony of the representatives of the National 
Association of Broadcasters (NAB) and the Federal Communications 
Commission (FCC) of the suggestion that the FCC might have to carefully 
consider counting any LPTV station, which achieves the proposed primary 
status, as a ``real'' TV station for purposes of the Commission's 
multiple ownership rules. You and I share the belief that this 
suggestion was a particularly surprising one for NAB to make, given 
that organization's consistent efforts to achieve deregulation of 
existing multiple ownership restrictions involving radio stations, TV 
stations, and daily newspapers in a given market.
    When you asked during the hearings for my comment on this point, I 
stated that I believed the fact that an LPTV station, which would 
qualify for primary status under the proposal, would have to air each 
week several hours of programming originated within its market--a 
requirement which does not presently exist even for full power TV 
stations--was sufficient to exempt the LPTV station from being counted 
the same as a full power station for multiple ownership purposes.
    A second reason I believe such stations should be exempted is the 
fact that LPTV stations presently licensed to parties who are also 
licensees of one or more radio stations and/or a full power TV station, 
and/or are the owner of a daily newspaper in the same local market, are 
among the best examples in America of excellent LPTV broadcasters, who 
serve their audiences with superior local public affairs, public 
service, and news programming and other local program features.
    How unfair it would be to force the divesture of any station by 
local broadcasters and newspaper owners, who complied fully with both 
the spirit and the letter of the multiple ownership rules when they 
built their LPTV stations! Frankly it would send a message to such 
entrepreneurs that the way to really get ahead in the local TV station 
business is not to build what has always been indisputably legal under 
the multiple ownership rules, but instead to resort to what many in our 
industry would call ``skirting the rules'' by entering into time 
brokerage agreements or ``local marketing agreements'' (LMA's) in order 
to be able to effectively operate not only the full power television 
station for which one holds a license, but a second or third ``LMA'd'' 
full power station as well!
    I understand that the Community Broadcasters Association (CBA) has 
suggested a change in the language of the subject bill, which would in 
effect ``grandfather'' those existing LPTV licensees, who have LPTV or 
radio, full power TV, or daily newspaper interests or multiple LPTV 
interests in their markets, so that they would not have their primary 
status LPTV stations counted by the Commission in making multiple 
ownership determinations.
    Finally, a third reason I believe qualifying primary status LPTV 
stations should not be counted for multiple ownership purposes relates 
to cable and is perhaps the most significant reason of all. Almost 
seven out of every ten American households receive their local TV 
stations via cable; yet even under the proposed law almost no LPTV 
stations--regardless of status--would enjoy the supreme privilege all 
full power stations enjoy (even if they don't originate one minute of 
local programming each week), ``must carry'' on area cable systems.
    Given the resistance the full power TV industry and the NAB have 
encountered in their attempt to assure ``must carry'' status for the 
federally-mandated digital stations each full service licensee must put 
on the air by May, 2002, I assume that the NAB would vigorously oppose 
``must carry'' for primary status LPTV stations, regardless of what 
other local media interests their licensees may have, just as NAB has 
opposed almost every thing else positive for LPTV and despite the 
praise that Association's testimony heaped upon the LPTV industry and 
the local service it provides.
    At the risk of seeming to be ``self-serving'' (our company has 
full-service [UHF] TV, LPTV, and radio in the same market) and with all 
things considered, we agree that ``grandfathering'' is the best 
solution. There is ample precedent for this. I believe the history of 
the broadcasting industry in this country (the almost 38 years I've 
been in the business personally and the 41 years preceding, which I 
have studied with some intensity) will reveal that the only instance in 
which ``grandfathering'' was not allowed when ownership restrictions 
were tightened was when the FCC or its predecessor The Federal Radio 
Commission (FRC) ruled back in the '30's or '40's that one owner could 
not own more than one ``standard broadcast station'' in the same 
market. That was at a time when ``standard broadcast stations'' were 
all AM stations. There was essentially no FM or TV then (nor was there 
any cable TV, DBS, MDS, MMDS, etc.).
    I thank you again, Mr. Chairman, for the privilege and honor of 
testifying before the Subcommittee.
            Sincerely,
                Houston Valley Broadcasting Corporation    
                                     George E. DeVault, Jr.
                                                          President
cc: Mike Sullivan, Executive Director
   Community Broadcasters Association,
   St. Cloud, MN

   Roy Stewart, Chief, Mass Media Bureau
   Federal Communications Commission
   Washington, DC

   Jim May, Executive Vice President
   National Association of Broadcasters
   Washington, DC
