[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]



 
 CORPORATION FOR PUBLIC BROADCASTING OVERSIGHT AND A LOOK INTO PUBLIC 
                    BROADCASTING IN THE DIGITAL ERA
=======================================================================


                                HEARING

                               before the

          SUBCOMMITTEE ON TELECOMMUNICATIONS AND THE INTERNET

                                 of the

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS

                             SECOND SESSION

                               __________

                             JULY 10, 2002

                               __________

                           Serial No. 107-133

                               __________

       Printed for the use of the Committee on Energy and Commerce









 Available via the World Wide Web: http://www.access.gpo.gov/congress/
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                    COMMITTEE ON ENERGY AND COMMERCE

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

MICHAEL BILIRAKIS, Florida           JOHN D. DINGELL, Michigan
JOE BARTON, Texas                    HENRY A. WAXMAN, California
FRED UPTON, Michigan                 EDWARD J. MARKEY, Massachusetts
CLIFF STEARNS, Florida               RALPH M. HALL, Texas
PAUL E. GILLMOR, Ohio                RICK BOUCHER, Virginia
JAMES C. GREENWOOD, Pennsylvania     EDOLPHUS TOWNS, New York
CHRISTOPHER COX, California          FRANK PALLONE, Jr., New Jersey
NATHAN DEAL, Georgia                 SHERROD BROWN, Ohio
RICHARD BURR, North Carolina         BART GORDON, Tennessee
ED WHITFIELD, Kentucky               PETER DEUTSCH, Florida
GREG GANSKE, Iowa                    BOBBY L. RUSH, Illinois
CHARLIE NORWOOD, Georgia             ANNA G. ESHOO, California
BARBARA CUBIN, Wyoming               BART STUPAK, Michigan
JOHN SHIMKUS, Illinois               ELIOT L. ENGEL, New York
HEATHER WILSON, New Mexico           TOM SAWYER, Ohio
JOHN B. SHADEGG, Arizona             ALBERT R. WYNN, Maryland
CHARLES ``CHIP'' PICKERING,          GENE GREEN, Texas
Mississippi                          KAREN McCARTHY, Missouri
VITO FOSSELLA, New York              TED STRICKLAND, Ohio
ROY BLUNT, Missouri                  DIANA DeGETTE, Colorado
TOM DAVIS, Virginia                  THOMAS M. BARRETT, Wisconsin
ED BRYANT, Tennessee                 BILL LUTHER, Minnesota
ROBERT L. EHRLICH, Jr., Maryland     LOIS CAPPS, California
STEVE BUYER, Indiana                 MICHAEL F. DOYLE, Pennsylvania
GEORGE RADANOVICH, California        CHRISTOPHER JOHN, Louisiana
CHARLES F. BASS, New Hampshire       JANE HARMAN, California
JOSEPH R. PITTS, Pennsylvania
MARY BONO, California
GREG WALDEN, Oregon
LEE TERRY, Nebraska
ERNIE FLETCHER, Kentucky

                  David V. Marventano, Staff Director
                   James D. Barnette, General Counsel
      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                 ______

          Subcommittee on Telecommunications and the Internet

                     FRED UPTON, Michigan, Chairman

MICHAEL BILIRAKIS, Florida           EDWARD J. MARKEY, Massachusetts
JOE BARTON, Texas                    BART GORDON, Tennessee
CLIFF STEARNS, Florida               BOBBY L. RUSH, Illinois
  Vice Chairman                      ANNA G. ESHOO, California
PAUL E. GILLMOR, Ohio                ELIOT L. ENGEL, New York
CHRISTOPHER COX, California          GENE GREEN, Texas
NATHAN DEAL, Georgia                 KAREN McCARTHY, Missouri
BARBARA CUBIN, Wyoming               BILL LUTHER, Minnesota
JOHN SHIMKUS, Illinois               BART STUPAK, Michigan
HEATHER WILSON, New Mexico           DIANA DeGETTE, Colorado
CHARLES ``CHIP'' PICKERING,          JANE HARMAN, California
Mississippi                          RICK BOUCHER, Virginia
VITO FOSSELLA, New York              SHERROD BROWN, Ohio
ROY BLUNT, Missouri                  TOM SAWYER, Ohio
TOM DAVIS, Virginia                  JOHN D. DINGELL, Michigan,
ROBERT L. EHRLICH, Jr., Maryland       (Ex Officio)
CHARLES F. BASS, New Hampshire
LEE TERRY, Nebraska
W.J. ``BILLY'' TAUZIN, Louisiana
  (Ex Officio)

                                  (ii)














                            C O N T E N T S

                               __________
                                                                   Page

Testimony of:
    Coonrad, Robert T., President and CEO, Corporation for Public 
      Broadcasting...............................................    26
    Klose, Kevin, President and CEO, National Public Radio.......    50
    Lafferty, Andrea S., Executive Director, Traditional Values 
      Coalition..................................................    55
    Lawson, John M., President and CEO, Association of Public 
      Television Stations........................................    60
    Mitchell, Pat, President and CEO, Public Broadcasting Service    45
    Walker, Laura R., President and CEO, WNYC-FM.................    73
    Willner, Michael, President and CEO, Insight Communication...    69

                                 (iii)












 CORPORATION FOR PUBLIC BROADCASTING OVERSIGHT AND A LOOK INTO PUBLIC 
                    BROADCASTING IN THE DIGITAL ERA

                              ----------                              


                        WEDNESDAY, JULY 10, 2002

              House of Representatives,    
              Committee on Energy and Commerce,    
                     Subcommittee on Telecommunications    
                                          and the Internet,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 10 a.m., in 
room 2123, Rayburn House Office Building, Hon. Fred Upton 
(chairman) presiding.
    Members present: Representatives Upton, Barton, Stearns, 
Gillmor, Cubin, Shimkus, Pickering, Fossella, Blunt, Davis, 
Bass, Terry, Tauzin (ex officio), Markey, Rush, Eshoo, Engel, 
Green, McCarthy, Luther, Stupak, Harman, Brown, and Sawyer.
    Also present: Representative Burr.
    Staff present: Linda Bloss-Baum, majority counsel; Will 
Nordwind, policy coordinator; Hollyn Kidd, legislative clerk; 
Jon Tripp, press; Andy Levin, minority counsel; Brendan Kelsay, 
minority professional staff; and Courtney Anderson, research 
assistant.
    Mr. Upton. Good morning. I note that there are a number of 
other subcommittees meeting this morning and we are in session 
on the floor, but we don't expect votes for a little while.
    Today's hearing is entitled, ``Corporation for Public 
Broadcasting Oversight and a Look into Public Broadcasting in 
the Digital Era.'' I wanted to do this hearing because of as 
the stewards of the taxpayers' dollars, Congress has an 
important responsibility to critical examine and review every 
program that it funds. It is the people's hard-earned money, 
not the government's.
    Today we are looking at the Corporation for Public 
Broadcasting, CPB, which receives about 12 percent of its 
funding from the Federal Government. The rest of its budget 
comes from contributions made to it from other sources. In 
turn, both the Public Broadcasting System, PBS, and National 
Public Radio, NPR, receive its public funding from CPB.
    Among other things, there are a number of issues relating 
to public television which we will focus on today. I would note 
that every public TV station is required to convert from analog 
to digital by May of 2003. Today we will hear how progress 
toward that conversion is going around the country.
    We will also hear about progress being made in regard to 
the carriage of public broadcasters' digital signals by our 
Nation's cable companies. In addition, we will hear about the 
impact of the FCC's decision last October to permit public TV 
stations to use its ancillary and supplemental digital spectrum 
for commercial purposes, like paging services, data 
transmissions, subscription video. The FCC believes that 
permitting such uses would enhance the public TV broadcasters' 
private fund-raising potential, but a number of committee 
members have expressed concerns that the FCC's decision will 
increase the commercialization of public broadcasting, to the 
detriment of its principal mission.
    We are also looking forward to hearing from the Association 
of Public TV Stations about its proposed Homeland Security 
Initiative, which would utilize some of the public TV stations' 
spectrum to datacast emergency broadcast information to the 
personal computers of first-responders. Such a system would 
appear to provide an additional layer of redundancy in our 
Nation's emergency communication systems. In the wake of 
September 11, the need for such redundancy has become all the 
more evident.
    Now also a word about public radio: It has been no secret 
that for years NPR has been dogged by allegations of a liberal 
bias. The national media in general has been dogged by similar 
allegations. When you come from a part of the country known for 
its Midwest common-sense conservative values, these allegations 
do not go without notice.
    However, the big difference between NPR and the national 
media in general is that NPR receives taxpayer funding while 
the national media does not. As such, NPR does have a distinct 
responsibility to provide objective and balanced reporting.
    Today we will hear from the Traditional Values Coalition, 
TVC, about a recent incident which it feels clearly 
demonstrates the liberal bias at NPR. I have to say that, as I 
reviewed the facts, TVC does have a legitimate complaint about 
the egregious treatment it received at the hands of the NPR 
reporter at issue in the case.
    I am not going to belabor the details, but suffice it to 
say that I do want to hear NPR's response. The bottom line is 
that we cannot tolerate any biased reporting from taxpayer-
supported public broadcasting, and I want to know what 
assurances NPR and CPB can provide that their reporting is, and 
will continue to be, objective. I look forward to hearing from 
today's witnesses.
    I also want to say that, as we look down the road, I do 
want to see us come with a reauthorization of CPB. It has not 
been done since 1992, and I would hope that today's hearing 
sets the stage for that work to be done in the not-to-distant 
future.
    With that, I yield to my friend, the ranking minority 
leader of the subcommittee, Mr. Markey from Massachusetts.
    Mr. Markey. I thank the gentleman very much, and I want to 
commend you for holding this hearing this morning on the Public 
Broadcasting System.
    Public television and radio are the crown jewels of 
broadcast medium, and I am pleased that we have an opportunity 
today to explore ways in which we can make the system stronger 
and prepare to meet the needs of its communities in the digital 
era.
    I believe that it is vital to express our firm commitment 
to providing an electronic oasis for learning and information 
and what has been called the vast wasteland of commercial 
television. Frankly, if public television and public radio did 
not exist today, we would probably be up here calling for its 
creation. Free, over-the-air, non-commercial television and 
radio are indispensable media outlets in our communities today 
for millions of Americans, and especially millions of children 
and their parents.
    Now, without question, there is a bias in the coverage that 
is on public television and radio, and I think we all know that 
exists. It is far too conservative in its views of the issues.
    I get tired of seeing Paul Gigot. I get tired of seeing 
George Will on baseball and that classic Republican, Oscar the 
Grouch, on ``Sesame Street.'' okay?
    You just can't turn the dial without running into one of 
these Republican-oriented, conservative commentators on public 
television, and ``Wall Street Week'' is getting even more 
conservative and defensive about capitalism, as I watch it week 
after week.
    Mr. Upton. I will have Larry Kudlow talk to you.
    Mr. Markey. Right, Larry Kudlow, all of them. My God, it is 
just that it is just a sea of conservatism, as I watch it. But 
I guess that is just my perspective, as I hear the words that 
are spoken by these people on public television.
    We must remember that telecommunications technology can 
only empower and educate those who can obtain it or those who 
can afford to get it. Not every American family can afford 
cable or satellite TV. At a cost of just over $1 per year per 
person, it is clear that what parents and kids get from free, 
over-the-air public TV and public radio is an incredible 
bargain. I contrast that with whatever my cable system makes me 
pay for HGTV, whatever it is, each week and day and month of 
the year, but I know that it is nowhere comparable as a 
television bargain than public television.
    One of the ways in which I believe we can further reinforce 
our commitment to public broadcasting is to take action to 
assist public television and radio stations in making the 
transition to digital technology. Digital content and digital 
transmission of information is obviously the future, and it is 
important that the Public Broadcasting System be digitally 
conversant.
    I have introduced legislation, H.R. 4641, that would, among 
a number of things, establish a Digital Dividends Trust Fund 
derived from spectrum auction revenues. The trust fund would 
earn interest and, from such earned interest, grants would be 
made for public interest telecommunications projects such as 
teacher training, digitizing content in our Library of Congress 
and national museums, and other initiatives. A portion of the 
money is also earmarked to supplement annual appropriations 
made to public broadcasting for the conversion of public TV and 
radio to digital technology.
    In addition, the legislation would further give the public 
greater access to its own airwaves by requiring NCIA and the 
FCC to work together to help to expand the notion of creating a 
spectrum commons. The legislation asks for chunks of spectrum 
to be freed up and clear, but not auctioned to the private 
sector. Instead, such frequencies would remain unlicensed and, 
therefore, available for use by the general public.
    High-tech. manufacturers, entrepreneurs, and the proverbial 
kid in the garage could make more robust use of wireless 
communications if sufficient spectrum were available in 
unlicensed form for the general public. Such as public setaside 
could foster the formation of an open platform for innovation, 
entrepreneurial activity, and public communications. It would 
also militate against unhealthy consolidation of spectrum in 
the hands of too few providers.
    Both of these actions, in my view, would help to reorient 
spectrum policy so that it better serves the needs of the 
public. Reinvesting certain spectrum option proceeds back into 
free-to-the-public digital telecommunications infrastructure 
should be part of our commitment for our future generations.
    Public broadcasting, as it has been throughout its history, 
should be poised to maximize the benefits of technology for the 
communities it serves, and I will continue to advocate for 
strong congressional support for its operations.
    Mr. Chairman, I want to thank you for having this hearing 
on a wonderful, invaluable public medium, and I yield back the 
balance of my time.
    Mr. Upton. Thank you very much. I would recognize the 
chairman of the full committee, Mr. Tauzin.
    Chairman Tauzin. Thank you, Mr. Chairman. I want to thank 
you for this long-overdue hearing and for your commitment to 
begin work on a reauthorization of public broadcasting in 
America at this committee and before your subcommittee, 
hopefully as soon as early next year.
    As you know, when I chaired this Subcommittee on 
Telecommunications, we were preparing to do just that, only to 
be met with this scandal of certain public television stations 
sharing their members list with Democratic political 
organizations, and the firestorm that erupted then prevented us 
from moving forward at that time with a fair and objective 
deliberation on the question of reauthorization. I hope we have 
a period of time soon when we can do that, and I encourage you 
to continue in your determination to bring reauthorization to 
the full committee.
    Let me say from the start that there are many of us on this 
panel and in Congress who are conflicted about public 
broadcasting. On the one hand, we love it for the same reasons 
expressed by my friend from Massachusetts, because we know it 
does a great job in education. We know it does a great job in 
presenting many features of broadcasting that are not 
commercially viable and, nevertheless, very valuable to many 
segments of the American community, and those features are 
presented on both radio and on television. We appreciate that, 
and we have long been supporters of public broadcasting for 
that purpose.
    But we are conflicted. It is one thing for my friend from 
Massachusetts to make fun of the complaints that Americans have 
about bias in publicly funds arts and public broadcasting, but 
I would recommend, and to my friends at the witness table, to 
reading of Mr. Goldberg's book entitled, ``Bias.'' See, in his 
book he explains it to us. He explains why public broadcasting 
perhaps doesn't understand the complaints of some Americans 
regarding the feeling that there is not necessarily objective 
coverage all the time in publicly sponsored with taxpayer 
dollars arts and public broadcasting.
    Perhaps some of you don't understand why Americans got 
upset when public dollars sponsored an art showing that 
depicted someone urinating on a picture of Jesus Christ, but 
Americans understand why they were upset about that.
    Perhaps some of you don't understand why Americans were 
upset when, on a morning news show on NPR titled, ``Morning 
Edition,'' hosted by Bob Edwards, the statement was made 
regarding the anthrax attack on people in this community, that 
the Traditional Values Coalition fitted the profile that the 
FBI was looking for in terms of a perp., and the investigators 
were thinking along those lines because the Traditional Values 
Coalition had the audacity to object to the fact that Senator 
Daschle and Patrick Leahy in the Senate might be interested in 
removing the phrase ``so help me God'' from the public oath. 
So, therefore, they must have been the murderers. That was 
literally the report on NPR, and NPR has not yet apologized to 
the Traditional Values Coalition for that kind of slander.
    And perhaps public broadcasting doesn't understand why 
Americans who are associated with the Traditional Values 
Coalition and strongly with their Christian faith would be 
offended to note that public broadcasting wouldn't even 
apologize to them for suggesting that they fit the profile of 
the perp. in this case. That is what ``The Village Voice'' 
called them, the ``perps,'' following up on the NPR report.
    See, in Goldberg's book he explains it to us quite well. He 
cites a press woman in New York City who, following the Nixon-
McGovern race, threw her hands up in frustration and said, ``I 
don't understand it. How could Nixon possibly have been elected 
in America? I don't know a single person, of all my friends, I 
know no one who voted for Richard Nixon.'' Richard Nixon 
carried 49 states against Mr. McGovern. He carried New York.
    Now I know my friend from Massachusetts might say he never 
met a person who voted for Mr. Nixon because I think 
Massachusetts was the only State that voted for Mr. McGovern.
    Mr. Markey. I was swept in on the McGovern landslide in 
Massachusetts.
    Chairman Tauzin. You were swept in?
    Mr. Markey. Yes.
    Chairman Tauzin. And perhaps you have never met anyone who 
voted for Mr. Nixon, but it is amazing that someone in a State 
that Mr. Nixon carried never met anyone who voted for Mr. 
Nixon. But Mr. Goldberg pointed out, you see, that is the 
problem. The problem is that when people live in such a tight 
circle of liberal friends that they don't know anybody who 
voted for Mr. Nixon, and in an election where he carried 49 
states.
    But anybody who lives outside that circle is considered 
right wing, is considered abnormal, out of step with the rest 
of Americans. Anybody living in that little circle believes 
they are normal, that they are literally living in the center 
and everybody on the outside is strange and extreme.
    It is an interesting read. Read it. Mr. Goldberg, a liberal 
reporter, ends up saying: We are bias because we don't 
understand that we don't represent the middle of America; we 
really represent something left of the middle. We just don't 
understand that people who live outside our circle might really 
be living in the middle. It is a pretty interesting 
observation.
    So when you hear complaints from Americans about public 
dollars being spent in ways that offend them, take it 
seriously. Understand that when we spend public dollars on 
public broadcasting, as we spend it on the National Endowment 
for the Arts, that Americans are sensitive that their public 
dollars are being spent in a way that they feel, they believe, 
doesn't respect their traditional values, and are not objective 
and fair. And don't make fun of them because they happen to 
believe very strongly in their faith, and don't make fun of the 
things they believe in, as some are prone to do.
    We are conflicted, too, because we only put 12 percent in 
public broadcasting, and we ask public broadcasters to raise 
the rest of the money, but we tell them: Don't become 
commercialized. That is a heck of a challenge.
    Mr. Markey and I signed letters asking the FCC to be 
careful not to force more commercialization in public 
broadcasting because, if that happens, then why public 
broadcasting? If you are really going to become commercial 
stations and commercial broadcasters, why on earth do we put 
any money into you? Why don't we just send you out there to 
compete with other private broadcasters and sell your 
commercials and your attributions, or whatever you want to call 
them.
    But if we don't want you to become commercial broadcasters, 
then maybe we need to be talking about trust funds and maybe we 
need to be talking about some source of funding other than 
commercialized funding base. Mr. Markey, we have had some good 
conversations about your ideas and other ideas we had.
    But I want to, in this brief time I have, and I think my 
time has expired now--I apologize, Mr. Chairman--I just want to 
sensitize all of you at the table to the fact that we are very 
conflicted over here. We love a lot of the work you do. We 
support you as much as we can, but it is hard sometimes to 
support public broadcasting when some public broadcasters 
behave the way NPR behaved with the Traditional Values 
Coalition, and it is hard to support public funding of things 
that I love, such as the arts in America, when people sponsor 
things that offend so deeply people's religious beliefs in this 
country.
    Thank you, Mr. Chairman.
    Mr. Upton. Thank you, Mr. Chairman. Mr. Sawyer?
    Mr. Sawyer. Thank you, Mr. Chairman. The topic that brings 
us here today is really the promise that the conversion to a 
digital arena holds for public broadcasting and the kind of 
good work that it can do.
    We have been united in our commitment to that conversion 
and to ensuring that those deadlines are met. Regardless of 
misgivings that members of this committee may feel, that 
commitment has been bipartisan and across the board, and I 
think it has been important.
    Digital broadcasting will allow televisions to partner in 
extraordinary and innovative ways with universities to offer 
continuing education and job training programs, will help local 
schools to receive educational content, and perhaps most 
important, at least for the near-term, the ability to establish 
and unite the Nation in a National Homeland Security Public 
Safety Network. All of these are, I hope, beyond conflict. I 
hope they are beyond ambivalence, because they are important to 
the country.
    But there are several issues that need to be resolved. 
Certainly first among those is the financial obligation 
entailed in that conversion, by some responsible estimates as 
much as $1.7 billion. Many stations, including my own local 
WNEO, WEAO, have done an admirable job of raising local funds 
to pay for the cost of transition.
    In the case of my local station, they have raised nearly 73 
percent of the $4.8 million they will need to make the 
conversion. That is an extraordinary achievement for an entity 
that has a $5 million annual operating budget.
    I think it is time for the Federal Government to help 
provide the necessary funds to ensure that all stations are 
ready by the May 2003 deadline. I think that is important.
    I think we can argue about content. I think we can talk 
about that. I think that is healthy in a democracy. But I hope 
that we won't allow those arguments to cloud the questions of 
requiring cable operators to carry only one channel and, 
thereby, not making full use of the digital spectrum that is 
important for public broadcasting; that subscription-based 
services not drive out public school systems that are strapped 
for money across the country when others are well able to 
afford those kinds of services. I think it is important that we 
make sure that, as we provide this spectrum, that we make sure 
that that spectrum is available for everyone.
    With that, Mr. Chairman, I would yield back the balance of 
my time.
    Mr. Upton. Thank you. Mr. Shimkus?
    Mr. Shimkus. Thank you, Mr. Chairman. I will just be brief.
    There's two subjects in our hearing today, and I think that 
is going to cause some consternation. I would like to have seen 
it an addressing of the whole digital transition issue, which 
is one issue, and then our ideological debates on another one. 
I know time concerns sometimes prohibit that. That is why we 
are conflicted, and that is why we are going to be conflicted 
at this hearing, because they are in the same, but we do have a 
problem with digital transformation and we need to move in that 
direction, not just for public broadcast, but also for even the 
profitable sectors having that problem. That is a national 
debate.
    There is the other issue of bias that we could spend all 
day haranguing, arguing about, but I think it is important to 
hear the testimony on both these issues. So because of that, I 
will yield back my time, so I can move the hearing 
expeditiously forward.
    Mr. Upton. Mr. Luther?
    Mr. Luther. Thank you, Mr. Chairman, for holding this 
hearing. I appreciate the opportunity to have a constructive 
discussion on public broadcasting in the digital age.
    Mr. Chairman, I believe it is incumbent upon this committee 
to ensure that public television and radio stations receive the 
support they need in order to make the transition to digital 
signal transmission. In this regard, I would like to highlight 
two brief points.
    First, I am interested to know how the FCC's recent 
decision on primary video will affect educational services for 
children and adults and local public affairs programming. Twin 
Cities Public Television in Minnesota, for example, excels in 
delivering this type of content to the community. If the cable 
company is only required to carry the primary video stream of 
the public television station's channel, what will be the 
affect on the station's other educational local programming?
    Second, I would like to emphasize that all public 
broadcasters are not created equal. In Minnesota we are blessed 
with WCAL, the Nation's oldest listener-supported radio 
station, along with the Nation's largest statewide radio 
network. Minnesota public radio is a regional network of 32 
radio stations and 19 translators, serving a regional audience 
of seven states and Canadian provinces.
    The rural character of the region makes digital conversion 
of the NPR network particularly daunting and expensive. 
Minnesota public radio reaches 5 million people with over 50 
transmitters and translators, an audience size that can be 
captured by only one station in a large city or metropolitan 
area.
    These comparative numbers illustrate a very important 
point. As we deliberate on public broadcasting's conversion to 
digital, we must take into account the fact that statewide and 
rural radio stations will have much higher per-listener and 
per-member costs. As such, without government support, we will 
create yet another digital divide between rural and urban 
areas.
    In order to fully appreciate the high cost of rural and 
statewide conversion, I would like to submit NPR's testimony 
for the record, Mr. Chairman.
    Thank you, and I look forward to the testimony. I yield 
back the balance of my time.
    Mr. Upton. Thank you. Mr. Pickering?
    Mr. Pickering. Mr. Chairman, I thank you for having this 
very important hearing.
    I just want to associate myself with the chairman's 
remarks, and that in my home State of Mississippi we are very 
proud of Mississippi educational TV and the services that they 
provide to a rural state, their educational programming, but 
also the cultural programming that they do. It is sensitive to 
the culture. It reflects the values. It respects the faith of 
the people in my home State.
    We want to maintain the good. We want to try to help as you 
modernize in the digital era. But we do have a hard time 
defending many of the actions of the national or CPB and some 
of the examples that the chairman raised. It is hard to defend 
and support an entity when the values and the faith of so many 
that I represent are not respected.
    I guess my hope is out of this that we will start to see a 
realization on CPB and NPR's part that they do need to take 
steps to address this. I think over time there have been 
efforts to do so, but I don't know if you would be willing 
today to apologize to Traditional Values for the statement that 
was made or the piece that was done.
    I think within the Board or within your staff there needs 
to be a greater diversity. I think Mr. Markey raised that you 
do have conservative and liberal voices on NPR as you try to 
look at your programming. But to those who produce and edit 
your programming, there may need to be some ways or steps that 
you can take to make sure that you not only have the sectoral, 
but you have the religious perspective, so that you can have a 
sensitive approach of understanding and respecting both points 
of views on many of the very divisive cultural issues facing 
our Nation, so it does not come across as bias or unfair or 
even hostile or disrespect.
    So I hope that today, as we talk about these issues, we can 
find a way that NPR, instead of being a divisive force, can be 
a force that creates respect for all points of view, and 
especially those who hold deep religious beliefs and views.
    With that, I yield back my time.
    Mr. Upton. Thank you. Ms. Eshoo?
    Ms. Eshoo. Good morning, Mr. Chairman. I, too, want to 
thank you for holding this important hearing on public 
broadcasting.
    Listening to the distinguished chairman of the full 
committee, I want to say forthwith and right upfront that I am 
not conflicted about my support of public broadcasting. I know 
that controversy comes with everything public in our country. 
That is the push and the pull of a democracy. Does it cause 
discomfort? Of course it does. I hear and read things that I 
don't always agree with, but, thank God, and I really mean 
that, that we can do that in this country.
    I am departing a little from some of my opening comments. 
In taking a look at some of the printed testimony of the 
Traditional Values Coalition, I am glad that you are here.
    I would also suggest that, when there are these 
controversies, do what many Members of Congress do and what 
families do in the country, get together with the people you 
disagree with. Sit down and hash it out. Maybe have a debate on 
NPR.
    But make no mistake that there are different views in this 
country; there is controversy. The day we don't have 
controversy in our democracy, I would suggest that we no longer 
have one.
    So I want to say upfront that I have no conflicts 
whatsoever. I don't feel conflicted at all.
    I remember in this committee where we had to really draw a 
line in the sand because there was a full-bore attack, a 
frontal attack, on public broadcasting and the funding of it, 
that small funding, public funding, right here at this 
committee. There was a substantial rescission in funding. You 
know that you have advanced funding, a 2-year advanced funding.
    So I am proud to have been part of the team in the trench 
that was part of the defense. I think it was important, and 
still important, to do so because I think that public 
broadcasting is one of the real jewels in the crown of America.
    Over and over and over again, awards have been received for 
its programming, especially in the areas of news and children's 
programming. We know that we need A+ news reporting. There's 
very little of it. Very few people to really draw their 
thinking and their analysis from the printed word.
    So I think that the evidence that is suggested in these 
awards in educating and informing really does enrich the lives 
of Americans. I think that we need to more fully appreciate the 
breadth and the depth of what that represents.
    I think also that public broadcasters should be thanked 
because of their announcement about the new campaign to 
establish a Homeland Security Public Safety Network by using a 
portion of their digital spectrum to do so. I think, once 
again, you are stepping up to do what is right for our country, 
in a very, very troubled, difficult time for us, by that 
announcement.
    If we are going to have a successful transition to digital 
transmission, the Congress is going to have to step up to home 
plate and provide appropriate funding for this. The cost is 
expensive, and the undertaking, I know, is estimated in the 
area of at least $1.8 billion. To your enormous credit, you've 
already raised about $750 million. That's a lot of dough. I 
know that it is not easy to do. I congratulate you for that. I 
think that we need to meet you more than halfway. In fact, I 
know that my constituents want us to, as do people across the 
country.
    So I urge the committee to continue its efforts to include 
language that authorizes the funding that is needed for the 
transition. That is what we should do.
    I welcome any and all review here. I am never afraid of 
that because I think at the end of the day, at the end of the 
week, at the end of the month, at the end of the year, year-in 
and year-out, public broadcasting really comes up like cream 
rising to the top. I couldn't mean that more.
    My children have benefited from it. Our country has. I 
think a send a message around the world about what we can do 
with public broadcasting.
    Remember, and I want to say this with all sincerity, that 
in other areas, in the foreign relations area, what is one of 
the first things that we want to do? We want broadcasting into 
other countries to take the information of democracy, the 
debate, and all that comes with it, so that people can become 
educated. Here at home I think that our appreciation needs to 
match that.
    So thank you to all of you. Thank you, Mr. Chairman, for 
holding this hearing.
    Welcome to all of the witnesses. I couldn't mean that more. 
Let's go forward and do something that is going to continue to 
strengthen our country.
    Mr. Upton. Thank you. Mr. Terry?
    Mr. Terry. Thank you, Mr. Chairman, and I will submit my 
complete formal statement for the record, but I want to express 
a couple of thoughts, random thoughts here.
    In particular, one of the issues that we are going to 
discuss here is content. I think we need to have that type of 
discussion, but also on the digital transition. I am proud that 
the Nebraska Educational TV Network in Nebraska, we have met 
several times. They co-produce ``The Reading Rainbow,'' one of 
the more popular children's educational TV shows, proud that 
Nebraska has their hand in one of the more important 
educational TV programs on PBS.
    But I have also been in constant contact about the 
struggle, especially from a rural State, that they endure in 
trying to meet the deadlines and they are on track to be fully 
transitioned by January, and I'm proud of that.
    But some of our discussions here have been on content. That 
is why I am going to leave my formal statement and talk that I, 
too, have been conflicted in my support for educational TV, 
PBS, public broadcasting. I have three young sons, 7, 4, and 2. 
I will tell you, we watch a lot of PBS, although I have 
DirectTV and I have to pay extra, by the way, pay extra to get 
PBS channels on DirectTV, which makes no sense, since the 
government underwrites the cost of those programs, why I have 
to pay more for them. But, nonetheless, we really enjoy the 
shows: ``Clifford,'' ``Dragon Tales'' are by far the most 
watched in our households.
    But the conflict is, while we certainly enjoy those, then 
we run into Sunday afternoon programming at four o'clock in the 
afternoon where they show shows like ``It's Elementary,'' where 
I don't know if my colleagues or those in the audience know 
what ``It's Elementary'' is, but it is a show that was not 
produced or paid for by public broadcasting that I know of. But 
it teaches America how to mainstream the homosexual agenda into 
classrooms.
    So while I have my kids in front of the TV on occasion 
watching ``Dragon Tales,'' I have to now, as a parent, sit 
behind them and wonder what PBS is going to show them. 
Obviously, when they are showing it in the middle of the 
afternoon, their agenda is to show it to my children.
    Now I have watched good TV programming that was more along 
those lines on PBS. There was a great show, a documentary, on 
the destruction of HIV that was shown at nine o'clock at night. 
I thought that was completely appropriate, and I learned a lot 
from that program about the destruction in the gay community of 
HIV. But you have to question as a parent, why were you showing 
a show like that at four or five o'clock in the afternoon on a 
Sunday afternoon?
    So I associate myself with my chairman's remarks. I am one 
of those people that are conflicted. While we love ``Dragon 
Tales'' and ``Clifford'' and all the educational programs, 
there just comes a time when PBS just wants to flaunt something 
in our face. I just don't understand that part of the agenda.
    So, Mr. Chairman, I look forward to the testimony of our 
witnesses and their answers to our questions, and I yield.
    Mr. Upton. Thank you. Mr. Brown?
    Mr. Brown. I thank the chairman. I echo the words of my 
colleague from California, Ms. Eshoo, in thanking you, all of 
you on the panel, for the high-quality broadcasting that you do 
in radio and television.
    Pat Mitchell mentioned in her testimony that ``News Hour'' 
with Jim Lehrer is consistently ranked by viewers as the most 
trusted and best news show. Kevin Klose will tell us about the 
Lowell Thomas Award and the Peabody Award, the increased market 
share that NPR is getting, and also the Armed Forces Network 
has dropped the regular programming and ran NPR's live coverage 
in U.S. military bases throughout the world.
    But I sit here and I hope that all of you on the panel 
don't get intimidated by my friends on the other side 
continuing their ranting and raving about the liberal media. I 
have been a Member of this body for 10 years, sat on this 
committee for 10 years. It is the same old Republican game they 
play, trying to intimidate CNN, trying to intimidate 
newspapers, trying to play this game that the media in this 
country are too liberal.
    They do it in the private sector with private broadcasting, 
with all of these newspapers and radio stations in the 
commercial sector owned by very conservative, large 
corporations, hardly a field that is ripe for growth in a 
liberal anything. But they play that game in the private 
sector. They are playing that game in the public sector. I ask 
all of you that represent public radio/public television not to 
be intimidated by that.
    Majority Whip Tom DeLay brought CNN, which is calls 
``Communist News Network,'' brought CNN to his office and 
basically he didn't quite threaten them, but he let them know 
in no uncertain terms that they were too liberal and he was 
unhappy about that.
    They rant and rave about all of the media being too liberal 
when, in fact, in 18 of the last 20 Presidential elections the 
majority of newspapers in this country which endorse endorsed 
the Republican for President. Almost every single time they 
endorsed Republicans. This isn't a liberal media that they like 
to tell us about.
    They then go on, they threaten CNN for all intents and 
purposes. They tell us that Fox is unbiased, which is laughable 
to anybody that is fairminded. They tell us the newspapers are 
part of the liberal media. It goes on and on and on.
    Now they bring you in, and they talk to you, picking out 
examples, as I can do--I can pick out examples at NPR, which I 
listen to almost every morning, about its conservative bias: 
Paul Gigot, George Will, John From, Louis Werkeiser.
    Cokie Roberts defends George Bush as a member of the family 
half the time. Earlier this week Cokie Roberts, when questioned 
by, I believe, Bob Edwards--I'm not sure--made some statement 
that, ``Well, George Bush was exonerated back in 1989 for his 
dealings with Harken.'' Yes, by an appointee of his father's, 
but she forgot to mention that. I mean, I could say that is 
conservative bias.
    The fact is you do your job; you do your job honorably. 
Don't get put on the defensive by conservative Republicans 
trying to nail you as a liberal media. You're not the liberal 
media. You seem to be generally pretty fair. I think you have a 
slight conservative bias by my personal belief. That is not all 
that important, what I think about that.
    But the sort of ongoing attacks--the last point I wanted to 
make was there was a survey done by a group about the Press 
Corps, the National Press Corps. They asked questions, trying 
to gauge liberal/conservative, of all the media covering 
Congress, covering the White House, on every economic issue: 
taxes, privatization of Medicare, privatization of Social 
Security, trade agreements, corporate responsibility. On every 
single economic issue, the public was more liberal than the 
media covering Congress and covering the President.
    Remember that when they continue this diatribe trying to 
intimidate NPR, trying to intimidate National Public Radio and 
Television into moving to the right. Don't let them do that to 
you. Don't let them push you that way.
    Most people in this country think that you're fair. The 
overwhelming majority of people in this country believe that 
you do a public service. Don't get caught up in putting even 
more George Wills and Paul Gigots and John Froms as 
commentators in pushing to the right, as too many people in 
this institution want you to do.
    I yield back the balance of my time.
    [The prepared statement of Hon. Sherrod Brown follows:]
Prepared Statement of Hon. Sherrod Brown, a Representative in Congress 
                         from the State of Ohio
    Thank you, Mr. Chairman.
    I am here today to express my strong support for public 
broadcasting.
    In Ohio, public television reaches 99 percent of the population, 
providing award-winning non-commercial, nonviolent programming that 
entertains and educates its audience.
    The three public television stations that serve my district provide 
valuable services to our local schools.
    These services include:

 Distance learning programs,
 Instructional materials and television programming,
 And technology training for teachers in eight Ohio counties.
    As public broadcasting transitions to digital, it will be able to 
provide an even greater amount of programming and services to our 
communities and schools.
    Stations are struggling to obtain the necessary funding to 
transition to digital.
    Many states are facing enormous budgetary crises, and cannot 
provide the funds needed for stations to go digital.
    It is important that we provide the necessary resources to our 
public broadcasters to continue their conversion into digital.
    Public broadcasting's focus on the local community provides an 
important balance to the increasing dominance of the corporate 
controlled media.
    The ownership of commercial stations throughout the country is 
swiftly being consolidated into control by a few major corporations.
    One-third of the nation's independent commercial TV station owners 
has vanished in the last 27 years, as smaller stations are absorbed 
into ever-larger conglomerates.
    The FCC is currently considering relaxing the rules on 
consolidation even further, which could result in your TV, radio, 
newspapers, and Internet news websites being owned by a handful of 
major corporations.
    The corporate owned mass media presents a perspective that 
represents the interests of the wealthy and powerful, while largely 
ignoring the needs of working families and the poor.
    In many communities, public television stations are the only 
locally owned and controlled media.
    Public TV stations have local boards of trustees, hundreds of 
thousands of volunteers, and numerous local partners and underwriters.
    It is important to note that the federal government is not the 
primary source of funding for public broadcasting.
    Private foundations and individuals contribute nearly 90 percent of 
the necessary support.
    These essential local supporters ensure that public television 
programs reflect their diverse local needs and interests.
    Digital transmission will only enhance their service to the local 
community.

    Mr. Upton. Mr. Stearns?
    Mr. Stearns. Thank you, Mr. Chairman. I would just 
encourage the gentleman from Ohio to read the book entitled, 
``Bias,'' and maybe after that he would be able to talk about 
this.
    I want to take a little different approach this morning. I 
think many of us would agree there is some outstanding 
programming on public broadcasting that is good. So they have a 
lot of quality shows.
    But the times are changing. What has happened is that the 
marketplace for informational and educational entertainment 
programming has changed so radically since the late 1960's, 
when CPB was originally authorized. So I think we need to put 
that in perspective.
    Thirty years ago, three major television networks and a 
handful of UHF channels dominated the television airways. Today 
Americans live in a world of information and entertainment. You 
can get almost 200-300 channels on Direct Television Satellite.
    In fact, Americans are bombarded with an endless array of 
programming, not just for the television, but also for the 
radio. It just didn't exist 30 years ago.
    This competition leads to the question whether CPB's 
original mission and present purpose has to change. Not only do 
programming providers such as C-SPAN, the Disney Channel, the 
Food Network, Nickelodeon offer programs that do not rely on 
public funding to bring quality shows to home viewers, unlike 
CPB's taxpayer-subsidized programs. So there's people out there 
that are doing it without the taxpayers' support.
    I guess the question we have to answer, Mr. Chairman, is, 
can the public broadcasters exist, can they be self-sufficient? 
If not, what should be done here in Congress to help them?
    As we discuss the Corporation for Public Broadcasting, I 
support enabling CPB to stand on its own. That is my basic 
argument today. They have widespread commercial appeal.
    Now they have a lot of businesses of their own they make 
money on: mail order catalog business, the operation of retail 
chain stores, the sale of popular television and radio programs 
on video, audiotapes, DVD, or such program-related merchandise 
as Barney or Sesame Street dolls, the toys, the games. I mean, 
I don't know them all, but I know that you have a lot of ways 
that you do make money.
    I think the final question, Mr. Chairman, would be, all of 
these businesses that the Corporation for Public Broadcasting 
uses to make money, shouldn't that provide them the potential 
to become independent of taxpayers?
    So I look forward to our hearing, and I think we should put 
that all in perspective. I thank you, Mr. Chairman.
    Mr. Upton. Mr. Engel?
    Mr. Engel. Thank you, Mr. Chairman. I feel very sorry for 
the panelists. They come here to testify, and they spend the 
first couple of hours listening to all of us.
    So thank you for coming. Thank you, Mr. Chairman, for 
calling the hearing. This is a great opportunity to discuss the 
contributions that public broadcasting makes to our 
communities. I want to especially recognize Laura Walker from 
WNYC, which I think is the country's best NPR station.
    I'm thinking back on what could have been a day of 
pandemonium and was the day of the worst attack by a foreign 
aggressor on American soil. It also was a day of incredible 
heroism.
    On September 11 in New York one of the great symbols of our 
country came crashing down, and we, of course, know that 3,000 
people lost their lives tragically that day. Throughout the day 
people turned to the radios and televisions to learn what was 
happening.
    My own friends--and I was in New York at the time--who were 
out at polling places for the primary elections that day, told 
me how everyone gathered around car radios and listened to 
WNYC-AM, which is our local national public radio station. They 
listened in horror as the Twin Towers collapsed.
    Had they been listening to WNYC-FM, they would have heard 
silence because the FM main transmitter and backup transmitter 
were on the North Tower. If they had been viewing Channel 13 
via an over-the-air broadcast, they would have seen just a 
snowy screen because WNET lost both of its analog transmitters 
and its 1-month-old digital transmitter.
    Public broadcasting in New York suffered grievous wounds 
that day. Sadly, WNET lost something far more valuable. WNET 
lost one of its own. Its engineer, Rod Cappola manned the 
transmitter until the end when the Tower collapsed and over-
the-air transmission was lost. Rod was one of some half-dozen 
broadcast engineers that were at the World Trade Center that 
morning tending to transmission for their stations.
    All of broadcasting in New York was hurt. The list of 
broadcasters who lost transmission capabilities is staggering: 
WCBS, Channel 2; WNBC, 4; WABC, 7; WNYW, 5; WWOR, 9; WPIX, 11; 
WNET; PBS, 13; WPXN, 31, and I can go on and on. WCBS, 2, on 
backup transmission, and WXTV, 41, and WFUT, 68, remained on 
the air broadcasting from the Empire State Building.
    Yet, despite the tragedy and obstacles at WNET and WNYC 
were experiencing, they stayed on the air. WNET even opened its 
doors to Mayor Guiliani and his emergency response team. The 
Mayor's Emergency Operation Center was in the Towers, and so 
WNET opened up its phone bank rooms to enable the Mayor to 
continue to work. This is just another example of what public 
broadcasting does for our communities.
    Now public television is looking to adapt its digital TV 
capability. A station in Kentucky had the idea of using parts 
of its spectrum to broadcast an emergency information signal. 
Working with the National Weather Service, that station can 
send its own video signal and at the same time alert residents 
to dangerous weather conditions. This has become a model for 
other public television stations throughout the country.
    I saw a demonstration that Mr. Lawson had recently in the 
Cannon Building, and I was really amazed at the capability and 
the promise that public broadcasting holds for these kinds of 
things.
    Public broadcasting adds value to our communities, and this 
value is reflected in the agreements that public television has 
been able to make with the cable industry. I am very pleased 
that Mr. Willner and others in the cable industry have 
recognized this and acted to include the other channels that 
PBS plans to offer.
    Mr. Chairman, I am a strong supporter of public 
broadcasting and always will be. I may not always agree with 
what I hear on NPR or see on PBS, but, by far, public radio and 
television constantly provide quality programming.
    I have had discussions with Mr. Klose about some of the 
things that I was unhappy about with regard to public 
broadcasting, about events in the Middle East and what I 
thought was a bias against Israel, and I know that he is 
working hard to try to make things evenhanded and to make 
things better.
    It is very, very hard to make things evenhanded. As we saw 
by some of the comments of our colleagues on both sides of the 
aisle, there are people that have questions and problems, but, 
again, it is in the eyes and the ears of the beholder.
    So these, ladies and gentlemen, have been a very, very 
difficult case in terms of trying to balance things out. But I 
think by far public radio and TV provide quality programming. 
They constantly enrich our society and they constantly make our 
communities better.
    I remember the bad old days here in Congress in 1995, when 
there was an attempt to zero out support for public 
broadcasting. I was proud that I was one of the leaders in the 
fight to keep government funds flowing to public radio and 
television.
    Public radio and television play a unique role. I would 
disagree with my good friend, Mr. Stearns; I don't want 
commercial appeal on public radio and TV. We have lots of 
commercial stations. It is unique to have public stations. I 
don't want them put into the position where they have to vie 
for commercial dollars. That would go against what we want them 
for and what they do. So I think it is very, very important 
that we keep them in the public realm and we keep providing the 
funds necessary for them.
    I have a list of awards that WNYC and WNET have received as 
a result of their September 11 coverage, and I ask unanimous 
consent that it be included in the record.
    Mr. Upton. Without objection.
    [The information referred to follows:]
                              wnyc awards
2002 Radio & Television News Directors' Association Edward R. Murrow 
        Awards
 Best Newscast--Winner, Regional Competition: SEPTEMBER 12th, 
        2001, by WNYC News
2002 Society for Professional Journalists Sigma Delta Chi Awards
 Best Breaking News Reporting--National Winner: September 11th: 
        A Local Radio Station Responds, by WNYC News (This award is 
        given by the Society of Professional Journalists, which 
        bestowed the honor on WNYC over many other national networks 
        and radio stations. It was the only SPJ prize for radio related 
        to September 11.)
2001 New York State Associated Press Broadcasters' Association Awards
 Steve Flanders Memorial Award For Best Radio Station Overall: 
        WNYC Radio, which ``exemplified the best traditions of 
        journalistic initiative and dedication in providing a complete 
        news service to the listening public.''
2002 Public Radio News Directors' Inc. PRNDI Awards
 Best Breaking News Reporting--National Winner, WNYC RADIO: The 
        World Trade Center Disaster, by WNYC News
 Best Continuing Coverage--National Winner, The World Trade 
        Center Disaster: A Local Station Responds, by WNYC News
    In addition, National Public Radio recognized WNYC during its 
acceptance of the Peabody Award for September 11th coverage. NPR Vice 
President Bruce Drake singled out the significant contribution of WNYC 
reporters and producers to NPR's national and international coverage 
during last year's tragedy.
                              wnet awards
    Thirteen received a special award from APTS at their annual meeting 
for the station's coverage and activities in conjunction with 9/11 
despite the loss of transmission.
    Received a special Trisscort Award from the Tri-State Catholic 
Committee on Radio and Television again for activities and programming 
in response to 9/11. One of our staff, John DeNatale who is the 
producer for NY Voices--a series that grew out of 9/11 and continues to 
look at some of the aftermath issues and concerns--also received a 
Trisscort Award
    Jason Kessler's film, ``Q. What's Wrong with this Picture?''--the 
documentary on 9/11 which debuted on MetroArts/Thirteen in December 
2001 won a 2002 Gabriel Award.
    And finally, Thirteen/WNET New York's ``In Our City: New Yorkers 
Remember September 11th,'' a production of MetroArts/Thirteen, was 
named best single public affairs program by the NY Broadcasters 
Association.

    Mr. Engel. I would just like to note one other issue. The 
events of September 11 had enormous implications for the entire 
telecommunications. I know, Mr. Chairman, we went, our 
subcommittee went and toured in the aftermath of the tragedy 
down at the World Trade Center and toured some of the buildings 
there. We have been right on top of the situation.
    That is why I and many other colleagues on the Energy and 
Commerce Committee from New York have requested a field hearing 
in New York to look into all these issues. I know the chairman 
was very interested in doing this, and hope that perhaps later 
this year there will still be time.
    So I welcome all my friends from public radio and TV, and I 
say, keep up the good work. You have many, many strong 
supporters in Congress on both sides of the aisle. Thank you. I 
look forward to hearing your testimony.
    Mr. Upton. Mrs. Cubin?
    Mrs. Cubin. Thank you, Mr. Chairman. While I associate my 
comments, my opinion, with the chairman's comments and Mr. 
Pickering's, I have to take issue with the ranting and raving 
accusation by my colleague from Ohio. The only ranting and 
raving I have heard here today came from him.
    In my life, when I tend to be judging what someone else's 
motives are or their actions, if I look back at myself, I find 
many times I am guilty of what I am accusing someone of, and 
that includes motives, political motives of people other than 
myself. So I would recommend that also to my colleague.
    And his statement that we are all up here bashing public 
television is absolutely wrong. I don't have one negative thing 
to say about Wyoming Public Television. In fact, I have a lot 
of good things to say.
    I have long supported my local station, which is called 
Wyoming Public Television, because in geographically isolated 
areas like Wyoming this public station provides our communities 
with a critically important source of free, over-the-air 
educational programming.
    Across America more than 65 million people live in rural 
areas, including 27 percent of America's children. Over one-
quarter of U.S. schools are located in rural areas. So public 
television is a major force.
    I will be speaking today about the conversion of public 
television's system of translators to digital because it is so 
vital to ensure that free, over-the-air educational television 
continues to be provided for rural areas.
    I am particularly interested in hearing the testimony of 
John Lawson--there he is--with the Association of Public 
Television Stations. I hope Mr. Lawson will provide this 
subcommittee with a thorough update on numerous topics, 
including the status of the digital conversion at public 
television stations like Wyoming Public Television.
    I recently heard from Dan Scheidel of Wyoming Public 
Television about the financial burdens that are imposed on it 
by having to meet the digital conversion mandate by May 2003. I 
especially would like you to address that specifically, Mr. 
Lawson.
    These issues are important to me because, as I said, I have 
long supported Wyoming Public Television and the great work 
that they do for all of our communities in the State. For 
example, Wyoming Public Television is participating in Teacher 
Line Program, which is a comprehensive professional development 
website for pre-K through 12 teachers. It helps Wyoming 
educators achieve math and technology skills that are 
recommended by State and national standards and it guides them 
toward integrating technology into their teaching.
    In addition, Wyoming Public Television is contributing to 
the intellectual development of the community through our 
history series it is creating about Wyoming called, ``Wyoming 
Voices.'' That is something that I think is very important to 
our children. We need to know, they need to know their roots. 
They need to know where they come from and their history, 
because it makes them feel more important. It gives them 
confidence that they aren't out here alone.
    This fourth series will use a mix of interviews with 
citizens who grew up in Wyoming communities and experienced the 
changes in the State's history, as well as interviews with 
historians from the State of Wyoming that come throughout the 
State.
    Finally, picking up on the Homeland Security Initiative, 
Wyoming Public Television is working with the Wyoming 
Department of Health to create bioterrorism training materials 
and teleconferences for the State's agriculture, tourism, 
industry, general public, law enforcement, and medical 
communities.
    I want to hear from Mr. Lawson, again, Wyoming Public 
Television's representative in Washington, what Congress can do 
to ensure that Wyoming Public Television can continue to 
provide these very necessary services and the wonderful 
programs that it provides.
    Mr. Chairman, I applaud your leadership, and I think that 
Mr. Tauzin is right on target in leading this committee through 
the work that we have to do. Thank you very much, and I wish I 
had time to yield back.
    Mr. Upton. Ms. McCarthy?
    Ms. McCarthy. Thank you, Mr. Chairman, for holding this 
important hearing on the digital transition of public 
television and public radio. I welcome the panelists and look 
forward to their wisdom.
    I wholeheartedly support public broadcasting. In fact, I 
would be lost without it. I listen to four stations, two in 
this community of Washington, DC, and two back home in Kansas 
City, one on either side of the State line. When I travel 
around the country, one of the first things I do when I get to 
my hotel room is find a PBS and public radio stations, so that 
I can keep up with what is going on and have some great comfort 
in knowing that it will be the wonderful, balanced, and 
objective coverage that they do every day.
    I want to commend Ms. Mitchell and those who helped bring 
to us the ``Commanding Heights'' program, for example. I thank 
you for making that available to Members on tape who couldn't 
watch it on public TV.
    I would just like to quote one of the reviews on that 
program, the ``Commanding Heights.'' ``One of the most serious 
and impressive efforts American TV has made to comprehend its 
own times.'' This from The Washington Times.
    I want to talk a little bit about my public TV station in 
Kansas City, Kansas City Public Television, because it is at 
the forefront of the digital television transition. The station 
launched its first digital broadcast on November 9, 1998, 
following the installation of a new digital transmitter and 
antenna.
    I went down to view it. It is very, very beautiful and very 
impressive. Since then, KCPT and Time Warner Cable have already 
worked together to create an agreement offering both analog and 
digital stations on digital cable. So those fortunate enough to 
own a digital TV can view the high-definition signal over 
cable. This is a great example of how a broadcaster and cable 
company can work together to solve the must-carry problem, 
instead of relying on a government for a mandate.
    When the transition is complete, KCPT will offer separate 
24-hour digital channels for community affairs, K-through-12 
programming, higher education and literacy programs such as the 
Spanish language programming they are doing already with Sesame 
Street.
    KCPT is taking a leading role in developing On-Course with 
the Corporation for Public Broadcasting. Through On-Course, 
public television and its educational partners will provide 
learning content in digital form for delivery to teachers and 
students. Public broadcasters continue to successfully meet 
their vision of educating all Americans.
    We are here today because later this summer the FCC will 
likely require a date certain for public broadcasting to 
include radio complete the transition to digital. Digital radio 
promises to provide near CD-quality sound and more efficient 
use of spectrum. Public safety services such as weather alerts 
and national security notifications can be sent over digital 
airwaves.
    Before a digital radio station is selected, we must ensure 
the equivalent of subcarrier channels to continue the 
broadcast. For instance, KCUR in Kansas City currently makes 
special secondary audio broadcasts to read magazines and 
newspapers to the seeing-impaired.
    The digital transition is capital-intensive, and most of 
the costs are borne locally. Even though KCPT has already spent 
more than $3.4 million and complied with the FCC mandate for 
digital broadcast by May 1, 2003, there is still more than $1 
million of work in order to complete the upgrade. KCUR will 
require about $100,000 to upgrade to digital radio.
    Because there is so little money budgeted in public 
telecommunications facilities program and the downturn in the 
economy has led to a decrease in donations, stations are 
struggling to raise enough funds to meet the deadline.
    I look forward to learning today how we ensure that the 
digital transition proceeds as planned, so that all Americans 
can experience the digital content which we have promised. It 
seems to me, Mr. Chairman, this hearing is very timely because 
the Federal Government must either increase funding to public 
broadcasting or change the deadline.
    Thank you, Mr. Chairman.
    Mr. Upton. Mr. Davis?
    Mr. Davis. Thank you. I ask that my entire statement be put 
in the record. I just want to make a couple of remarks.
    I have been a consistent supporter of public broadcasting. 
I favor Federal DTV authorization for the conversion.
    Having said that, though, let me just say I am a little bit 
disturbed about the January 22 incident. Mr. Tauzin I think has 
spoken about it eloquently. I think the manly thing to do in a 
case like this is to apologize straight-up. I think it was a 
bad story. You have acknowledged it was inappropriate. I think 
that is the easiest way to make a clean slate of it.
    You have a lot of wonderful shows that I watch and listen 
to. The ones I don't I turn off. I have that option. But when 
you take public money, well, you also get public input from the 
people that fund it. I think that is what you are hearing 
today.
    So I look forward to hearing the testimony today. I thank 
everyone for participating, and I hope we can move ahead. But I 
would like to bring this other issue to closure. I think this 
is an appropriate forum for that. Thank you.
    [The prepared statement of Hon. Tom Davis follows:]
Prepared Statement of Hon. Tom Davis, a Representative in Congress from 
                         the State of Virginia
    I want to commend you, Mr. Chairman, for holding this most timely 
oversight hearing on public broadcasting. It is important that we 
examine the practices and policies of our nation's public broadcasters 
periodically to ensure they remain faithful to their statutory mission 
and provide balanced programming, as required by law.
    One of the issues that certainly will be discussed at today's 
hearing is the authorization of funding needed for public broadcasters 
to convert to digital television. Consistent with congressional 
direction, the FCC has set a May 1, 2003 deadline for public 
broadcasters to commence digital broadcasts. Although public 
broadcasters have raised almost 40% of the funds they estimate will be 
required for the DTV conversion, the vast majority of that funding has 
come from private sources or the states. I hope that our Committee will 
consider seriously a federal DTV authorization for public broadcasting.
    In assessing the need for a DTV authorization, I urge my colleagues 
to take note of the pioneering role public broadcasting is playing in 
optimizing digital technology for the benefit of consumers and our 
communities. Almost all public broadcasters intend to use multicasting 
to send 4 video streams of various types of educational programming 
geared to all ages and segments of our diverse society. Public 
television stations have committed to using the equivalent of one 
digital channel for providing formal education--in essence a broadband 
pipe to schools to be used for datacasting. Earlier this week, public 
broadcasters demonstrated for staff of this Committee a new application 
of DTV for homeland security--dedicating a very small portion of 
digital spectrum to ``broadcast'' data to PCs in homes, offices and to 
first responders to enable our citizens to cope with public 
emergencies, be they terrorist attacks or natural disasters. We need to 
push the edge of the digital envelope, and public broadcasters have 
demonstrated they are ready, willing and able to do so.
    I also want to commend both the public broadcasters and two cable 
companies, AOL Time Warner and Insight Communications for reaching 
voluntary nationwide digital TV carriage agreements, and I urge other 
cable companies to follow swiftly the lead of AOL Time Warner and 
Insight in concluding such marketplace based carriage agreements with 
public broadcasters.
    Finally, National Public Radio and public television stations 
present unique, interesting content, of that there is little doubt. 
However, we must acknowledge the concerns of those that believe this 
content does not always present an objective viewpoint. Since public 
broadcasters do receive public funds, they bear a special burden--over 
and above normal journalistic ethics--to report the news in a balanced 
fashion. I understand that NPR and other public broadcasters pride 
themselves on their rigorous editing standards; however, mistakes are 
sometimes made. This is understandable, but I will be interested to 
hear representatives of public broadcasting discuss these concerns and 
their efforts to provide the balanced reporting required of them.

    Mr. Upton. Mr. Stupak?
    Mr. Stupak. Thank you, Mr. Chairman, and thank you for 
holding this hearing today.
    Besides the quality fare that PBS offers for adults, I also 
know how much children love PBS shows such as ``Clifford, the 
Big Red Dog,'' and my chief of staff's daughter, Emma, is among 
these fans. At a recent staff barbecue I sat and read one of 
the Clifford books with 3-year-old Emma. I would be hard-
pressed to show my face in Emma's house again if I was not 
fully supportive of ``Clifford'' and other PBS idols such as 
Angelina Ballerina and Arthur. I will try to be as objective as 
possible in this hearing, despite the potential repercussions 
with my chief of staff and Emma and countless other children.
    Currently, there are two Michigan public television station 
broadcasts in my northern Michigan district, WNMU in Marquette 
and WCMU out of downstate, which broadcasts on WCML in Alpina. 
These stations are very important to my northern Michigan 
constituents, and I want to ensure that these stations in my 
smaller, more rural areas are equally represented as these 
discussions progress.
    Michigan public television stations face great challenges 
in the digital transition since Governor Engler has vetoed 
legislation that would provide funding to them for this 
transition. As a result, Michigan stations are much more 
reliant on other sources of funding.
    For example, Scott Seaman, the General Manager of WMNU in 
Marquette, which broadcasts to over 55,000 households in the 
Upper Peninsula, now faces enormous financial difficulties in 
meeting the FCC's mandate of the May 2003 deadline for a 
digital transition.
    I look forward to the hearing today, Mr. Chairman, and 
hearing from the witnesses on what can be done to assist 
smaller, more rural public television stations in meeting this 
deadline and ensuring that their valuable programming is 
ensured for the future.
    With that, Mr. Chairman, I would yield back the balance of 
my time.
    Mr. Upton. Mr. Bass?
    Mr. Bass. I thank the chairman. It is a very interesting 
hearing. I am looking forward to participating in the process.
    As has already been noted, I think we should try to keep 
the main focus for today on the transition to digital 
broadcasting and the support that public broadcasting needs to 
meet its transition goals as quickly as possible.
    Having served on the Transportation Committee, every time 
we had a hearing on airlines, it always degenerated into 
Members saying how much they disliked waiting for this airline 
who was late, and so forth and so on. I am finding out quickly 
that it is inevitable that the same equivalent occurs here, 
that everyone will have their own opinions about whether public 
broadcasting is fair one way or the other.
    I just want to say, as I said before, that the hearing 
really ought to focus on the process, not the content, although 
it will, perhaps appropriately, to some extent deal with that.
    I also want to say that our public television and radio 
stations in New Hampshire, and I assume elsewhere in the 
country, provide outstanding programming and services to the 
community. They have my full support.
    It doesn't appeal to all viewers at all times or listeners. 
That is unavoidable. But it is a balancing act that is 
undertaken. On the whole, I think that public broadcasting 
fills an important void and does so in a very meaningful 
fashion.
    Public broadcasters, however, like every other enterprise 
in America, including governments and government-sponsored 
organizations, do make mistakes, and when they do, I hope they 
step forward, as my friend from Virginia just said, admit the 
problem, and work to resolve it in the future.
    I also hope that today's hearing is only the beginning of 
our work on public broadcasting. CPB reauthorization, 
addressing digital cable carriage or spectrum allocation, 
commercialization of the underwriting are items that I hope 
this committee takes up in the weeks and months ahead.
    On this last item, underwriting commercialization, I again 
want to associate myself with the view of our full committee 
chairman and the others who wrote the FCC on this matter last 
November. I think it is important that the programming stay 
non-commercial, and it is an integral part of its value and 
justification for public support.
    So, Mr. Chairman, thank you for holding this hearing. It is 
a great issue, and I look forward to participating. Thank you.
    Mr. Upton. Ms. Harman? Mrs. Harman?
    Mrs. Harman. Thank you, Mr. Chairman. You can call me 
whatever you would like.
    I am happy to be here and think this is very important for 
our committee to consider, and the part of the issue that I 
really think we have to focus on, as Mr. Bass said, is the 
transition to digital, because the folks in front of us have a 
lot of good ideas about how to make that transition occur 
faster and better. That is something, it seems to me, the 
Energy and Commerce Committee, and particularly this 
subcommittee, should make a high priority.
    A couple of our members, Mrs. Cubin and Mr. Engel, have 
commented on the opportunities that this transition can offer 
for homeland security. Since that is something that I focus on 
quite a bit, I would just like to make a few observations 
there.
    I was very impressed in a conversation with Mr. Lawson to 
learn about the experiment that occurred in Kentucky--Mr. Engel 
mentioned this--where a demonstration program, and I am sure he 
will address this in his testimony, was undertaken that could 
put signal on PCs. I think they actually demonstrated that this 
could happen.
    Signals on PCs can be overridden by emergency signals 
delivered by public television, and those emergency signals can 
tell PC users, many of whom are senior citizens now, that there 
is or may be a terrorist activity in their neighborhoods and 
specifically what to do about that.
    It seems to me that if we have the opportunity to do things 
like this through public television stations, we ought to not 
just embrace these ideas; we ought to be all over these ideas 
because this is, by my likes, one of probably the best ways to 
reduce panic and increase information to communities about not 
just terrorist threats, but other perhaps emergencies of a 
natural nature. Hailing from California, the home of 
earthquakes, it seems to me that this is a very good idea that 
we should consider.
    It is also true that the witnesses before us will talk 
about their interest in this transition in a way that offers 
other opportunities for homeland security. For example, I am a 
principal sponsor of something called ``The Hero Act,'' which 
would set a firm date for the DTV transition in 2006. The 
reason the Hero Act is pushing that transition is to free up 
spectrum for emergency communications.
    It seems to me if these folks can make that transition by 
2006, they are helping our first-responders achieve the 
interoperability that they need through increased spectrum in 
the event of a terrorist attack or other emergency.
    So I just want to focus on the transition issues for a 
minute, point out what opportunities we have, make clear to our 
witnesses that I embrace Federal funding to help them make this 
transition, and point out to our committee that one of our 
major objectives, which is the digital transition, can be 
achieved if we support many of the ideas that these witnesses 
have.
    I think these opening remarks are very interesting today, 
but I think the most interesting aspect of them is the fact 
that I think on a unanimous basis everybody here wants to get 
on with the digital transition. We have part of the answer 
before us. Thank you, Mr. Chairman.
    Mr. Upton. Mr. Barton?
    Mr. Barton. Thank you, Mr. Chairman. I appreciate you 
holding this hearing.
    Put me down as one of the skeptics about the need for 
public broadcasting today, given the explosion in cable 
television and satellite systems, although I do know that there 
are some people that can't afford either of those. So there 
still is some role for public broadcasting.
    I also think there is a bias in public broadcasting. 
Notwithstanding some of the anthology series on the Civil War 
and baseball, and this latest one, ``Commanding the Heights,'' 
about the world economy, which I think, as Congresswoman 
McCarthy said, is one of the best things that public 
broadcasting has done in the last 6 years, I still think that 
there tends to be a little bit too much bias toward the liberal 
side, but in a free society that's appropriate.
    If you are going to have freedom of speech, you ought to 
let the broadcasters speak however they want. So I am not going 
to whine about that.
    I do hope that we look at this digital transition. I do 
think there is a role for public funding, for Federal funding, 
of PBS and the digital transition. The public television 
station in my area, KERA, transitioned to that I think last 
year.
    I have a very cordial relationship with both the TV and the 
radio public broadcast systems in my area. They do know that, 
if I had to vote to defund it, I would do it. I think you folks 
would be a lot better off if you got 100 percent funding from 
other sources and didn't take any Federal dollars with the 
exception of helping you on the technology side, where I think 
we have a role to play.
    This is a very good hearing, and I wish the chairman well 
as we go through it. I am in a markup in the Science Committee 
on homeland security, Mr. Chairman, so in fact I've got a 
series of votes I'm going to have to run off to, but I wish you 
all well. I will try to get back to participate in the Q&A. 
Thank you.
    Mr. Upton. Mr. Green?
    Mr. Green. Thank you, Mr. Chairman. It is good to follow my 
colleague from Texas, and I want to commend the chairman for 
calling this hearing.
    I think it is important that, as Members of Congress, we 
look at the current and future needs of public broadcasting on 
a regular basis before it becomes a crisis.
    If you can't tell, my district is in Houston, Texas, and 
both our public radio station, KUHF, and our public TV station, 
KUHT, are valuable assets in our district, and there are now 
eight Members of Congress who will share the Houston area.
    The programs available on NPR and through PBS are both 
enlightening and provoking. Although we are going to hear from 
a critic of public broadcasting today, I am confident that 
their views represent only a minority when it comes to valuable 
public commodity.
    Having read the testimony, I welcome all groups, like my 
colleagues, to this free speech experience. Welcome to this pit 
of freedom, and you can't silence critics or questions in the 
arena. That is part of the system. I may not like what NPR says 
about, well, for example, Israel was brought up earlier, but I 
listen. That is part of the free speech experience. If you are 
going to be in this pit, then you are going to take hits as 
well as everyone else.
    Going forward, however, our public broadcasters face many 
of the same funding challenges as their private sector 
competition. Digital television transition is accelerating 
while most of the public TV stations, television broadcasters 
in the major markets have converted, and that is true in 
Houston as well, and most of our markets have converted.
    There is clearly a developing need to assist the smaller 
market stations in their transition. My colleague from Wyoming, 
I assume Wyoming and lots of our smaller market communities 
need that help that we need to consider. Trying to raise 
private funding in tough economic times is proving to be a 
tough hurdle, I understand. Not every public broadcaster can 
draw on deep financial support like you can from a major market 
like Houston, and that means the Federal Government, if we are 
going to include this whole Nation in PBS broadcasting, we need 
to have some type of one-time help in transition assistance.
    While there is an outcry from some in this body about 
increasing funding probably, in my opinion, we will not be 
doing our job if thousands of small children lost the access 
the ``Clifford, the Red Dog.'' I have to admit my generation, 
my children were raised on PBS, but they are grown, and so 
``Clifford, the Red Dog'' is probably as important as ``Sesame 
Street'' was to my children's generation.
    Public broadcasters provide a great deal of local 
programming in support of every community they are in, and I 
know because I participated in that for years, both as a State 
legislator and now in Congress. We may not like the news 
stories they report or the specialty pieces they develop, but 
it is journalism, and if you want one daily news item, you need 
to go to China or maybe Saudi Arabia.
    I want to commend the public broadcasting community for the 
great job that they do and for the service they provide, and 
for being a leader at least in our area of digital transition.
    Mr. Chairman, I will yield back my time.
    Mr. Upton. The gentleman's time has expired. The gentleman 
from North Carolina, Mr. Burr.
    Mr. Burr. Mr. Chairman, I would ask unanimous consent of my 
colleagues to be allowed to give an opening statement and to 
participate in the hearing.
    Mr. Upton. Objection?
    [No response.]
    Hearing none, the gentleman is recognized.
    Mr. Burr. I thank the Chair and I thank my colleagues.
    The committee discussion and consensus on public television 
issues are important and I think long overdue. Absent an 
authorization bill for 10 years, I am glad that you and 
Chairman Tauzin recognize the significance of holding this 
hearing today.
    As a long-time supporter of public television, and 
particularly my own State network, UNCTV, as well as an avid 
listener of NPR, even when the stories are about myself, today 
I want to commend each of our witnesses for taking the time to 
join us today.
    As you are all painfully aware, the management of a public-
funded entity is a difficult task and requires patience, 
creativity, and hard work. Your work, no doubt, enriches the 
lives of millions that otherwise would have limited access to 
diverse cultural experiences and educational programming for 
both youth and old. For this, I thank you.
    We are not here today to talk about should or shouldn't we 
of public television. That debate is part of our history. 
Rather, I believe that we are here as members of this committee 
and the public at large to benefit from taking a closer look at 
how we spend our precious public television dollars and how we 
intend to sustain the digital transition in a responsible 
manner.
    The public television family is one where there are many 
members: the stations, the corporation, PBS, APTS, NPR, among 
others. However, one family member that seems overlooked 
recently is Congress. Perhaps Congress and, more importantly, 
this committee is to blame for failing to expressly define 
expectations of public television. This will change.
    I feel strongly that Congress--and when I say ``Congress,'' 
I mean the American people--has an obligation to ensure that 
public television is using public resources wisely, promoting 
the general welfare, and living up to the public trust bestowed 
upon it. By and large, I see public television doing that 
consistently.
    However, irresponsible actions of a few have strained the 
relationships between the public television community and this 
committee. I am hopeful that we can continue to work out those 
differences, yet embrace our mutual support of the industry.
    I am appreciative of Chairman Regula and his colleagues on 
the House Appropriations Committee for working with us to 
provide a funding blueprint for digital conversion in last 
year's supplemental and regular order appropriations bills. We 
must all work together now and in the future to build a public 
television system like Pat Mitchell describes that creates 
``miracles of teaching and learning and that informs, inspires, 
educates, and engages.'' This is what public television is all 
about, and this is what I support.
    Although North Carolina has already received full digital 
funding through public referendum, I lend my support to helping 
all public television stations in their transition to the 
digital era. My only request is that we approach some of these 
issues together with the recognition that Congress and this 
committee has a role to play.
    Mr. Chairman, I thank you and I thank my colleagues for 
allowing me to participate, and I yield back.
    Mr. Upton. Believe it or not, that concludes the opening 
statements.
    I will say very quickly that I will ask unanimous consent 
that any member that is not here, that their statement may be 
placed as part of the record. So being, it is done.
    Welcome to the panel. This morning we have Robert Coonrod, 
President and CEO of the Corporation for Public Broadcasting; 
Ms. Pat Mitchell, President and CEO of Public Broadcasting 
Service; Mr. Kevin Klose, President and CEO of National Public 
Radio; Ms. Andrea Lafferty, Executive Director of the 
Traditional Values Coalition; Mr. John Lawson, President and 
CEO of the Association of Public Television Stations; Mr. 
Michael Willner, President and CEO of Insight Communications, 
and Ms. Laura Walker, President and CEO of WNYC-FM in New York.
    Welcome, all of you. I would note that your testimony is 
part of the record in its entirety. We would like to limit you 
to 5 minutes for your opening statements, at which point we 
have questions from the members on the panel.
    Mr. Coonrod, you get to go first. Thank you.
    You need to just turn that microphone on. You, of all 
people, should know that rule.
    We've learned.

STATEMENTS OF ROBERT T. COONRAD, PRESIDENT AND CEO, CORPORATION 
   FOR PUBLIC BROADCASTING; PAT MITCHELL, PRESIDENT AND CEO, 
 PUBLIC BROADCASTING SERVICE; KEVIN KLOSE, PRESIDENT AND CEO, 
NATIONAL PUBLIC RADIO; ANDREA S. LAFFERTY, EXECUTIVE DIRECTOR, 
  TRADITIONAL VALUES COALITION; JOHN M. LAWSON, PRESIDENT AND 
    CEO, ASSOCIATION OF PUBLIC TELEVISION STATIONS; MICHAEL 
WILLNER, PRESIDENT AND CEO, INSIGHT COMMUNICATION; AND LAURA R. 
               WALKER, PRESIDENT AND CEO, WNYC-FM

    Mr. Coonrod. Thanks for holding this hearing. I think the 
discussion that we have heard already this morning has been 
tremendously important to me and my colleagues as we try to 
think about the future of public broadcasting, and particularly 
the partnership that we have with the Congress, because it is 
an important partnership.
    Before I make some opening remarks, though, I would like to 
recognize the Chairman of the Board of the Corporation for 
Public Broadcasting, Catherine Anderson, who is with us this 
morning. Catherine Anderson. So while I am the President and 
CEO, she is the Chairman of the Board.
    It has been 3 years, Mr. Chairman, since we have had an 
oversight hearing. We have faced a number of challenges during 
that period, and some very good things have happened. My 
colleagues will be prepared to provide a number of those 
specifics.
    I would like to start, however, by offering a capsule 
summary of public broadcasting's overall financial situation 
and describing the very critical role you and others have 
suggested that the congressional support plays.
    Public broadcasting is not immune to the overall economic 
trends. Many stations are cutting their budgets and reducing 
staff because of decreases in State funding and a softening of 
local fundraising and underwriting. Congressional support is 
essential in this environment.
    The rising costs of program production and distribution, 
the cost associated with the conversion to digital that many 
members of the subcommittee have mentioned this morning, and 
the need to continue to innovate, make public support for 
public broadcasting more important than ever.
    As you mentioned, Mr. Chairman, the Federal share of public 
broadcasting's revenues is relatively small, about 12 percent, 
but it is vitally important. These limited resources provide 
enormous leverage and much-needed continuity.
    Our response to September 11 I think demonstrates this very 
well. CPB was able to provide nearly $11 million in special 
crisis funding. This money was used to pay for additional 
reporting. It allowed for expanded versions of ``The News Hour 
with Jim Lehrer,'' ``Washington Week,'' and supported NPR's 
Peabody award-winning coverage.
    Public broadcasting's response was many-faceted. It also 
included special music programming, mental health outreach 
efforts, and special call-in programs. It also helped with the 
reconstruction of WNYC. You have Laura Walker on the panel 
later in the testimony.
    Public broadcasting's commitment to local communities 
underlies CPB's thinking about its core program, the Community 
Service Grant Program. Last year we conducted a statutorily 
required review of our procedures and made several changes 
which we think will help stations provide service that better 
meets local needs.
    I would be happy to answer any questions you may have about 
this review. As part of my testimony, I have included a 
complete summary of all of the changes that we included in the 
programs.
    CPB is also helping broadcasters to use new technologies to 
serve a broad range of viewers and listeners. For example, CPB 
partners with the American Film Institute in an enhanced TV 
workshop where television producers learn to tap digital TV's 
potential. In 2002, two flagship children's series, ``Sesame 
Street'' and ``Arthur'' will be included in this highly 
competitive program, as will two of PBS's signature program, 
``POV'' and ``Matters of Race.''
    Public broadcasting is becoming adept at using the 
Internet, and CPB was part of an effort to create a new web 
portal, African American World. This site is a treasure house 
of photographs, essays, music, and interviews. More important, 
it ensures that material that was originally developed for 
broadcast, everything from segments of ``Morning Edition'' to 
``Soldiers without Swords,'' which is a film about the black 
press, all of these materials will be accessible on the 
Internet long after the programs have aired. And, as is the 
tradition in public broadcasting, they will be accessible on 
the Internet at no cost to the user.
    CPB also supports creation of free-standing websites that 
do not have a broadcast component. The first effort is a group 
of sites aimed at America's ``tweens,'' the 16 million 9-to-12-
year-olds who too often fall between the cracks between 
children's and adult programming.
    Kids are spending increasing amounts of time on the 
Internet, choosing it even over television. Public broadcasting 
has to be there with them. CPB helped fund the original 
``Sesame Street,'' the program that redefined television for 
children, and supported its recent reinvention to help build on 
new ideas about how young children learn.
    Supporting projects produced for the Internet is consistent 
with CPB's history of innovation and our legislative mandate to 
use all appropriate available telecommunications distribution 
technologies.
    As we look forward, we are going to be supporting a local/
national initiative for Zoom, so that kids in their local 
communities will be able to participate in an important 
national programming. We are going to be supporting a 2-hour 
documentary hosted by Ben Wattenburg which will describe the 
meteoric rise and spectacular fall of socialism.
    We remain committed to supporting traditional fare, like 
the National Memorial Day Concert and films of Ken Burns, but 
we are also strengthening coverage of local elections through 
the use of a Web hub and exploring ways to integrate digital 
technology into classroom instructions.
    Mr. Chairman, these initiatives are possible because the 
money provided by the Federal Government forms a vital, stable 
core of funding. With it, we support local stations, continue 
signature programming, reach out to underserved audiences, and 
explore new technologies like digital and the Web.
    We want public broadcasting to remain grounded in its 
bedrock commitments and to be relevant to the still unknown 
needs of the 21st century. The possibilities are endless, and 
working together with the Congress we look forward to achieving 
those possibilities.
    Thank you, Mr. Chairman. I would be happy to take your 
questions.
    [The prepared statement of Robert T. Coonrod follows:]
Prepared Statement of Robert T. Coonrod, President and CEO, Corporation 
                        for Public Broadcasting
                              introduction
    I am pleased to be here today before the Subcommittee on 
Telecommunications and the Internet. This is the first time I have 
appeared before you since you became Chairman of the Subcommittee, Mr. 
Upton. I hope that today's testimony contributes to a broader 
understanding of the many contributions that public broadcasting makes 
to the American people. I also acknowledge that we are among old 
friends like Chairman Tauzin, Mr. Dingell and Mr. Markey, who have 
worked with public broadcasters for many years and contributed much to 
the success of both public television and public radio.
    This November will mark the 35th anniversary of the Public 
Broadcasting Act, signed by President Lyndon Johnson on November 7, 
1967. It has been 10 years since the Public Broadcasting Act was 
reauthorized and three years since we have been before you to discuss 
issues of mutual concern. We, therefore, appreciate this opportunity 
for an oversight hearing and look forward to a constructive discussion.
    At the Subcommittee's request, I am going to provide a primer on 
how CPB fulfills the charter contained in the Public Broadcasting Act 
and implements its' responsibilities to support educational programming 
and to make grants to radio and television stations. But before I do, I 
would ask for a few minutes to brag a little about public 
broadcasting's recent contributions to the lives of the American 
people, and to talk about the steps we are taking to ensure that public 
broadcasting remains a leading source of quality programming.
                   recognition of public broadcasting
    Year after year, according to ``Roper Reports,'' Americans rank 
public broadcasting as one of the five best values they receive for 
their tax dollars. Our peers in the industry share the public's high 
regard for the extraordinary programming available from public 
broadcasting. This year, public broadcasting received a total of 11 
Peabody awards, nearly one-third of the 34 awarded. Public broadcasting 
won five primetime Emmys, seven news and documentary Emmys, and 11 
daytime Emmys. Nine of the daytime Emmys were for children's 
programming, marking the 5th straight year that PBS has earned more 
Emmys for children's series than any other broadcast network. I think 
it is clear that the vision of Congress in passing the Public 
Broadcasting Act--to create an institution that would encourage 
extraordinary, creative programming to educate, inform, and enrich 
Americans--is being fulfilled daily.
                        objectivity and balance
    We are proud of the recognition public broadcasting receives. We 
also strive to know and understand the opinions of those who criticize 
us. And yes, we do have critics--after all, people do have different 
opinions on most subjects.
    As required by the Public Telecommunications Act of 1992, CPB 
routinely solicits, reviews and disseminates the views of the public on 
national public broadcasting programming, and considers these comments 
in making programming and grant decisions. CPB also reports to Congress 
annually on the public comments it has received.
    We responded to the 1992 directives by creating the Open to the 
Public initiative, described more fully later in this submission. In 
designing it, we strove to achieve a high level of accountability while 
abiding by congressional prohibitions on interfering in the editorial 
decisions of other public broadcasting entities and respecting public 
broadcasting's commitment to decentralization and localism.
    Last year, CPB's Board and officers undertook a comprehensive 
review of its Open to the Public policies and procedures to see how 
they could be updated and strengthened. The review included an 
examination of the ways in which public broadcasting institutions in 
the United Kingdom, Japan, Australia, and Canada ensure accountability 
to their citizens, as well as consultation with leaders of America's 
national broadcasting organizations to explore ways to expand public 
comment efforts and assure objectivity and balance in programming.
    CPB's Board and officers identified and reviewed a number of 
enhancements to existing Open to the Public policies and procedures. 
The changes, which are in the process of being implemented, include:

 soliciting feedback in CPB-distributed publications;
 distributing analyses of public comments to CPB executives, 
        the Board, and grant recipients on a regular basis;
 encouraging local stations to develop awareness of Open to the 
        Public in their communities;
 requiring CPB-funded producers to include e-mail links on 
        their Web sites to CPB's comment line;
 designating a senior CPB official to act as a point person to 
        whom viewers and listeners can direct comments; and
 working with a representative number of local radio and 
        television stations to develop model public feedback 
        mechanisms.
    We hope that these initiatives will encourage the public to share 
its views with us, and make it easier for us to address their comments.
                           digital transition
    This year, public television is nearing the FCC-mandated 
construction deadline to convert to digital transmission by May 1, 
2003, and the public radio transition is about to begin. At our last 
authorization hearing before this Committee three years ago, we 
discussed the challenges and opportunities this new technology 
presents--the need to raise funds from federal, state, and local 
sources; to purchase and install the equipment; and to create 
programming and content that takes advantage of the new technology.
Digital Technology and Public Broadcasting
    Many have suggested that the digital transition represents the 
biggest change in the TV medium since the advent of television itself. 
Digital television (DTV) technology provides a host of opportunities 
for public television including interactive education and training 
programs. Digital radio also offers an array of technological 
opportunities including on-demand personal audio services and assisted 
living/technology services.
    The new technology presents the opportunity to address some of the 
nation's biggest domestic challenges. We can truly revolutionize the 
way we use the airwaves not just to entertain, but also to teach, and 
to work. Interactive TV, for example, permits viewers to watch programs 
and interact at their own pace with extra features that are ``fed'' as 
extra resources within the actual broadcasts. Viewers decide if and 
when they want more information on a particular program topic and use 
their TV remotes to call up the additional information on their TV 
screens. Another innovative feature of digital technology is 
multicasting. TV signals are split into two or more streams, all airing 
simultaneously but carrying different programming. These additional 
program streams could include distance learning for adults, broadcasts 
of live local events, and full-time children's programming.
    Public broadcasters are excited about the potential of the medium. 
With their long experience in providing exciting educational, cultural, 
and public service programming, they are uniquely positioned to use the 
various digital technologies to serve the needs of millions of viewers 
and listeners of all ages and ethnic backgrounds.
Status of Digital Transition
    Today, nearly 20 percent of public broadcasting stations (76 of 
356) are able to broadcast a digital signal. Although this does not 
mean they are fully functioning digital public broadcasting stations, 
they have crossed the first threshold--transmission of a digital 
signal. So far this year, 27 stations have converted. My statement 
includes a complete list of public broadcasting stations that have 
converted to digital, as of this week.
    Many stations are not yet able to purchase the necessary 
transmission equipment, but have still invested considerable time and 
resources to prepare for the transition. The total cost for creating 
fully operational digital public broadcast stations is estimated to be 
more than $1.8 billion. Stations have already raised nearly $750 
million of this amount, including $476 million already authorized or 
appropriated by the legislatures of 44 states as of July 1, 2002.
    The federal commitment in the last three years is just over $123 
million, including grants from the Public Telecommunications Facilities 
Program at the Department of Commerce and the $45 million appropriated 
by Congress to CPB for fiscal years 2001 and 2002. CPB has been given 
the authority to distribute the $45 million to public broadcasting 
stations in consultation with representatives of both television and 
radio licensees, as required by statute, and these consultations have 
been on-going for both radio and television. The first grants from the 
federal money were announced at the end of May, and a list of 
recipients is attached to my testimony. We expect that the full $45 
million will be awarded by October 2002.
    Under the requirements set by the Administration and the Congress, 
as well as the guidelines issued by CPB, these grants must be put 
towards digital transmission facilities. Grant applicants must 
demonstrate that they will inaugurate new services to the community, 
and preference is given to projects that provide local educational and 
rural services and promote efficiency in operations. These awards can 
be made to individual stations or to multi-station collaborations that 
will contribute to cost and administrative efficiency.
                             beyond digital
    Public broadcasters are the only broadcasters committed to giving 
every American access to the important educational services and other 
critical services that digital broadcasting offers. Our commitment to 
rural and remote communities means not only ensuring that they are not 
left behind in the digital transition, but also exploring ways of 
bringing them additional benefits, for example, broadband.
    We are also exploring ways of continuing our leadership in 
educational programming by using new technology. Tens of millions of 
Americans--and particularly children--are already benefiting from the 
educational services available through the Internet, and that number 
will continue to grow as schools become more adept at using the new 
technology. CPB recently funded ``Are We There Yet?,'' a study 
sponsored by the National School Board Foundation of the ways that 
schools are using technology. The study found that many schools were 
not yet tapping the full potential of the Internet, but nearly all 
respondents expected that the next few years would bring an explosion 
of Internet use in the classroom.
    CPB is supporting five new Internet projects geared at 9 to 12 year 
olds--the ``tweens'' who too often fall between the cracks of children 
and adult programming. These are fun, engaging and educational 
destinations on the Internet--places that are dedicated to educating 
children, rather than marketing products to them. The sites are:

 ``It's My Life,'' offering a place where kids can share 
        experiences and concerns about the social and emotional issues 
        that affect them, produced by KCTS, Seattle;
 ``Don't Buy It,'' teaching tweens to be smart consumers by 
        thinking critically about advertising and media, produced by 
        Castle Works, Inc., New York;
 ``Backyard Jungle,'' exploring our natural surroundings and 
        showing kids ``what's out there,'' produced by Forum One 
        Communications, Virginia;
 ``The Plastic Fork Diaries,'' questioning whether--and how--
        what we eat affects who we are, produced by Maryland Public 
        Television; and
 ``3D & I,'' offering kids a chance to test their eye at design 
        and encouraging them to think about the role of culture and 
        environment, produced by The Doc Tank, New York.
    We believe that public broadcasting is uniquely positioned to 
develop this kind of Web content. Thus far, the kids seem to agree. 
``It's My Life'' is receiving 150 e-mails a day, many of them 
containing the word ``cool.'' There were about 2 million page visits at 
``It's My Life'' in its first two months of operation, and Yahooligans 
(Yahoo's kid-friendly search engine) has listed ``Don't Buy It'' as a 
``cool site of the day.'' The three other sites will go live by the end 
of this summer. The sites can be accessed through local public 
television station Web sites, giving them content with which to reach 
out to a new audience.
    We also believe that the television programming we support is 
strengthened and enriched by a strong Web component. We now look at 
programming in a different way, seeing the broadcast program as one 
element in a mix that always includes an interactive Web site where 
viewers can access information not included in the broadcast. We also 
look for imaginative education components for the schools and for 
strategic community outreach to encourage informed civic dialogue.
    We are expanding the ways in which we use existing public 
television content on the Web. CPB worked with PBS, NPR, WNET in New 
York, and an independent producer to create a new African-American Web 
portal, ``African American World.'' This just-launched site is a 
treasure house of material--photographs, essays, music, and 
interviews--providing invaluable information on this critical part of 
American history. Creating the portal means that the material developed 
for broadcast--everything from segments of Morning Edition to 
``Soldiers Without Swords,'' a film about the black press--will be 
easily accessible long after the programs have aired.
    CPB now provides major funding for the American Film Institute's 
Enhanced TV (eTV) workshop. The workshop provides television producers 
an opportunity to work with world-class technology innovators and 
designers--who serve as mentors--to tap digital television's potential 
to provide viewers with interactive, personalized, and multi-faceted 
on-screen learning experiences. Entry into the workshop is highly 
competitive, and we are very proud of the number of public television 
programs chosen to participate. In 2001, public television programs 
such as ``People Like Us: Social Class in America'' and ``Accordion 
Dreams'' were accepted into the workshop. In 2002, two flagship 
children's series--Sesame Street and Arthur--will be included, as will 
two PBS signature series, P.O.V. and Matters of Race.
                          serving communities
    In 1967, Congress created the Corporation for Public Broadcasting, 
declaring, ``It is in the public interest to encourage the growth and 
development of public radio and television broadcasting, including the 
use of such media for instructional, educational and cultural 
purposes.'' For more than 30 years public broadcasters have used the 
most current technology available to ensure that all Americans have 
access to the highest-quality, non-commercial, educational and cultural 
programming in their homes, schools and workplaces. With more than 
1,000 locally controlled public radio and television stations, public 
broadcasting forms the largest community-based educational and civic 
institution in the nation.
    As our discussion of the Internet demonstrates, much has changed 
since 1967. There are new issues facing communities and the nation, new 
technologies that pose challenges as well as opportunities. Despite the 
many changes, the public policy goals for public broadcasting remain 
the same--universal access for all Americans to quality non-commercial 
content and services.
    There is no better example of the valuable service that public 
broadcasters provide than what it has been doing in the months since 
September 11. The Public Broadcasting Service (PBS), National Public 
Radio (NPR), and local public broadcasting stations have been on the 
air with extensive in-depth reporting of the terrorist attacks on the 
United States, the nation's response, and the underlying issue of 
international terrorism. Many hours of special coverage have been 
devoted to keeping the American public informed, helping them 
understand the unprecedented events, and providing an outlet for local 
response. As you may know, NPR's coverage of September 11 won a Peabody 
Award, one of broadcasting's highest honors.
    In addition, our stations responded in their own communities by 
providing much needed services--both on and off air. This was 
especially true in New York City where WNET, the local public 
television station, turned over its phone banks to the Red Cross and 
the Mayor's Office of Emergency Management to operate a 24-hour 
emergency response center to assist families of the victims with 
counseling services and information. They also provided temporary 
workspace to Port Authority staff members who lost nearly 200 of their 
colleagues in the attack, and to the WNYC-radio staff that was 
displaced by the World Trade Center attacks.
    WNYC, New York City's largest public radio station, was on the air 
at 8:51 am on September 11, with what may have been the first 
eyewitness account of the attack on the World Trade Center. While the 
attacks cut off WNYC's FM transmission and telephone service, several 
WNYC staffers stayed in the building and continued broadcasting over 
WNYC's AM signal. Another WNYC reporter was present and providing live 
coverage from Ground Zero when the south tower collapsed. WNYC 
reporters played key roles in NPR's around the clock coverage of the 
attacks for days following September 11.
    The special programming and services were not confined to the New 
York area, as public television and radio stations across the country 
responded to the needs of their communities.
    Now, as we approach the one-year anniversary of September 11, 
public radio is preparing to air one of its most important programming 
experiments--the first nationwide Public Radio Collaboration. Producers 
and stations across the country are working to create a week of locally 
crafted programming that will help us to understand the way Americans 
live now, after September 11. We expect that September 3 to 10 will be 
a week in which public radio once again stands out from the 
predictable, offering the depth and insight that only public 
broadcasting provides.
              how the public broadcasting system operates
    Let me turn now to discussing the way that public broadcasting 
operates. In contrast to commercial broadcasting, which is increasingly 
centralized, the public broadcasting system is very decentralized. 
Every public broadcasting outlet is under local control or ownership; 
increasingly, they are the only locally owned and operated media 
outlets in their communities. With local governing boards, community 
advisors, volunteers, and partnerships with local organizations, 
stations work to provide programs and services responsive to the needs 
of their communities. Each local station maintains sole authority and 
responsibility for selecting, presenting or producing the programs that 
it airs. Congress placed control of programming with local stations 
rather than CPB. It ensured this autonomy by prohibiting CPB from 
owning or operating any television or radio station, system or network, 
and barring it from producing, scheduling or disseminating programs to 
the public.
    Instead, CPB operates within congressionally prescribed guidelines 
to provide financial support and services to 560 licensees operating 
more than 1,000 television and radio stations that deliver educational 
services and programming to virtually every household in the country. 
Congress has mandated that a majority of CPB's appropriation be 
allocated for direct station support. Our obligation to Congress and 
the American people is to ensure that this money is being spent wisely 
and efficiently. Our obligation to stations is to insulate them from 
the political process, and to ensure that their receipt of federal 
support in no way interferes with their ability to operate as free and 
independent broadcasters, as prescribed by law.
    In addition to our financial support of stations, CPB complies with 
the statutory requirement of providing funds to producing entities and 
independent producers to help them develop a wide range of programming 
that is then made available to local stations. As encouraged by 
Congress, CPB provides direct program support to PBS through 
contractual negotiations for a high-profile national program service, 
which includes series such as Nova, American Experience, Sesame Street 
and NewsHour with Jim Lehrer. CPB does not provide direct program 
support to NPR, which competes with other producers for CPB radio 
program funds on a program-by-program basis. CPB also provides 
programming dollars to entities such as the Independent Television 
Service (ITVS), five separate entities collectively known as the 
National Minority Consortia, and many independent producers and 
producing organizations, all of which are entirely independent of CPB. 
This enables stations to acquire programming independently from a wide 
variety of sources.
    Public television stations choose their programs from the following 
sources, among others:

 PBS, which provides more than 1200 hours a year of children's, 
        prime time, and other educational programming from which its 
        member stations can choose.
 APT, which acquires programs that may be purchased by stations 
        on a title-by-title basis. These include series and specials 
        such as Nightly Business Report and Julia & Jacques: Cooking at 
        Home. APT also maintains the largest source of free programming 
        available to U.S. public television stations.
 ITVS, which funds, distributes and promotes independently 
        produced television programs such as ``An American Love 
        Story,'' ``Digital Divide: Technology and Our Future,'' and 
        ``The Farmer's Wife.''
 The National Educational Telecommunications Association 
        (NETA), which annually distributes about 2,000 hours of 
        programming--produced by public television stations, other 
        entities and independent producers--via satellite to stations 
        nationwide.
    Public radio stations also get their programming from a wide 
variety of sources:

 Local productions typically account for about half of 
        programming. In the Washington, D.C. area, for example, WAMU's 
        The Diane Rehm Show and Stained Glass Bluegrass, to name just 
        two programs, are locally produced, as is much of WETA's 
        classical music programming.
 36 percent is from NPR, including news and information 
        programs like Morning Edition, All Things Considered, and The 
        Tavis Smiley Show, cultural programming like Jazz from Lincoln 
        Center and The Thistle and the Shamrock, and entertainment 
        programming like Car Talk and Wait, Wait . . . Don't Tell Me!
 10 percent is obtained from PRI, which distributes programs 
        like Marketplace and A Prairie Home Companion; and
 5 percent is from other producers, including other public 
        radio stations. For example, The Diane Rehm Show, produced at 
        WAMU, is heard on stations around the country.
                 how cpb distributes its appropriation
    CPB distributes its funds based on a formula set forth in the 
Communications Act of 1934, as amended (47 U.S.C. 396(k)(3):

 At least 6 percent of its appropriation for certain 
        statutorily enumerated expenses for the system of stations 
        (i.e., music royalties, interconnection expenses, ITVS and 
        minority consortia operational expenses, etc.)
 Not more than 5 percent for administrative expenses
    The remaining 89 percent is allocated to stations as follows:

 75 percent for public television
 75 percent of which is for grants to television stations
 25 percent of which is for television programming
 25 percent for public radio
 70 percent of which is for radio station grants
 23 percent of which is for radio program acquisition grants
 7 percent of which is for radio programming
    A schematic diagram of the flow of the funds is as follows:


[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]


    
                           grants to stations
    The statute directs CPB to provide a grant to each station in 
accordance with eligibility criteria and on the basis of a formula 
designed to (1) provide for the financial needs and requirements of 
stations in relation to the communities and audiences such stations 
undertake to serve; (2) maintain existing, and stimulate new, sources 
of non-federal financial support for stations by providing incentives 
for increases in such support; and (3) assure that each eligible 
licensee and permittee of a public station receives a basic grant (47 
U.S.C.A. 396(k)(6)(B)).
    Local television and radio stations are the bedrock of the public 
broadcasting system. They are community institutions working in 
partnership with schools, libraries, and other community organizations 
to provide news and information, children's, local public affairs, and 
cultural programming for their viewers and listeners. There are many 
types of stations--state networks that provide service across an entire 
state and receive significant support from their state government; tiny 
rural stations that offer the only local news in a town or a region; 
major city stations that produce national programs; joint licensees 
that operate both public television and radio stations; and stations 
owned by universities or school systems. Each of these stations is 
governed by its own board of directors, provides its own brand of 
program options, and faces its own challenges in meeting its financial 
obligations. CPB's grant structure, while complex, represents our best 
efforts to respond to the multiplicity of needs facing public 
broadcasters.
                       public television stations
Television Community Service Grants
    Almost 50 percent of the money CPB receives is set aside for direct 
grants to public television stations, known as television community 
service grants or CSGs. A full-power station operating under a 
noncommercial, educational Federal Communications Commission (FCC) 
license qualifies for a CSG if it meets minimum requirements including 
a minimum level of non-federal financial support, a minimum broadcast 
schedule, and bookkeeping and programming standards.
    The CSG is divided into two parts. The first part is the base 
grant, a percentage of the federal appropriation. In FY 2002, the base 
grant is $385,000. Designated overlap stations (that is, stations that 
share a market) share a single base grant for that market. The second 
part is an incentive grant designed to reward a station according to 
the amount of non-federal financial support it raises. Every CSG 
qualifying station receives the incentive part of the grant, which 
encourages the development of non-federal revenue, as prescribed by the 
statute.
    As required by statute, stations use CSGs for purposes ``primarily 
related to the production or acquisition of programming.'' Grant 
amounts vary widely from station to station, based on the amount of 
non-federal support that each station raises. CPB monitors grant 
spending through a combination of routine reporting requirements and 
direct audits conducted by CPB's Office of the Inspector General.
    In addition to the CSGs, CPB will provide two other types of grants 
to television stations beginning in 2003--the local service grant and 
the distant service grant. These grants are based on formulas arrived 
at after extensive consultation throughout the system--with 
representatives of APTS and PBS, but primarily with station general 
managers who appreciate the sharply different needs of stations 
throughout the system. The formulas that they developed are complex, 
but strike an extraordinary balance between providing support to all 
and offering special help to those who need it. In this, they reflect 
the statute's policy goals by working to maintain universal service. 
This translates into making extra help available to stations providing 
services to small and rural communities; encouraging support from local 
private and public sources; and encouraging efficiency.
    Local Service Grants. CPB recognizes the special needs and 
challenges of small stations and the important role they play in 
providing universal access to free, over-the-air local public 
television. For that reason, CPB will provide additional incentives to 
stations with less than $2 million in non-federal financial support. 
The grants are intended to strengthen local services such as outreach 
initiatives, educational projects and services, operational 
efficiencies, implementation of best practices, financial planning, and 
professional development.
    Distant Service Grants. To recognize the additional costs of 
serving multiple communities and the efficiency of multiple transmitter 
operations, and to further the goal of universal service, CPB will 
provide larger grants to single grantees who operate three or more 
transmitters (stations). The grants will be used to strengthen 
services, including outreach, educational workshops and training, and 
local content, in these communities
    The complete CSG policy is attached for your review.
                         public radio stations
Radio Community Service Grants (CSGs)
    Under the statute, CPB provides 15.6 percent of its total 
appropriation to 384 grantees who operate approximately 700 public 
radio stations that qualify for radio CSG funding. The grants are 
designed to address the disparate needs of urban and rural stations. 
These stations provide outstanding, award-winning news and information, 
arts and entertainment programming, as well as valuable community 
services. Sometimes they represent the only local broadcast signal --
commercial or noncommercial--that a rural community receives. CPB also 
offers special funding incentives for nearly 60 minority grantees and 
more than 100 grantees operating in rural environments.
    A licensee or permittee of a radio station operating under a 
noncommercial, educational FCC license is eligible to receive a CSG if 
it satisfies certain minimal requirements relating to power, staff 
size, on-air time, financial viability, access to non-Federal financial 
support, record keeping, and programming. Higher grant amounts are 
available to public radio stations meeting a minimum standard of public 
service as measured either by the average quarter-hour listening 
audience, or by the level of local fund-raising support.
Grants for Programming
    CPB is prohibited by law from producing or distributing 
programming. However, CPB actively encourages promising TV and radio 
projects, supports independent producers, and helps fund productions by 
and about minorities. CPB provides funding to the Public Broadcasting 
System (PBS) to support the National Program Service, and CPB's Radio 
Competitive Funds are the major source of funding for new national 
radio programs.
Television Programming
    CPB provides an annual grant to support the National Program 
Service (NPS), the package of television programming that is fed by 
satellite to PBS member stations in return for their dues payments. 
This includes signature series like NewsHour with Jim Lehrer and PBS 
Kids children's programming, as well as the Sunday-through-Friday prime 
time schedule. In FY 2002, CPB is providing $22.5
million for the NPS. These funds, which CPB does not administer, 
support scores
of individual programs and provide continuing support for some of 
public television's
signature series.
    In addition, CPB matches the stations' contribution to the PBS/CPB 
Program
Challenge Fund, which is intended to stimulate the development of high-
impact, in-
novative television series such as Frontier House and American Family, 
as well as
programs such as the critically acclaimed ``Commanding Heights.''
    CPB also administers a General Program Fund, used to fund 
educational projects
and television programming. It supports a number of proposals on 
selected topics
of national interest that meet the highest standards of excellence. 
Past projects in-
clude Masterpiece Theater's American Collection, ``Accordion Dreams,'' 
and the Me-
morial Day and July 4th Concerts. High priority is given to programming 
that illus-
trates America's rich cultural heritage and ethnic diversity.
    CPB also provides administrative and programming funds to five 
multicultural
groups known collectively as the National Minority Programming 
Consortia (Na-
tional Asian American Telecommunications Association; Native American 
Public Telecommunications, Inc.; National Black Programming Consortium; 
Pacific Island-
ers in Communications; and Latino Public Broadcasting). These groups 
reallocate
funds to producers for the development of programs of diverse content.
    In FY2001, CPB established the Diversity Fund to encourage public 
television
projects that help people think about the complexity and beauty of 
America's con-
temporary multi-cultural society. Two projects supported by the 
Diversity Fund will
air on PBS this fall. The Rise and Fall of Jim Crow is a four-part 
series that will
fill the gap between The Civil War and Eyes on the Prize in public 
television's filmed
record of American history. Muhammad: Legacy of a Prophet will explore 
how
Muhammad's early 7th century teachings transformed the world and 
continue to
shape the lives of approximately 1.2 billion Muslims worldwide, 
including an esti-
mated 7 million in America.
    As directed by Congress, CPB also provides annual programming 
support to ITVS,
which in turn, provides production grants to independent producers 
developing
projects intended for public broadcasting. This support helps CPB meet 
its statutory
requirement that it provide ``adequate funds for an independent 
production service.''
ITVS's work is of high quality--one program, ``Still Life with Animated 
Dogs,'' won
a Peabody Award this year--and ensures that public television benefits 
from the
strong voices of independent producers whose stories resonate 
particularly with
underrepresented and underserved audiences.
Radio Programming
    Since 1987, CPB has directly supported the production of radio 
programs intended
for national audiences. Throughout its history, CPB has awarded about 
three of
every four radio programming grants to national projects by or about 
ethnic groups
and to projects by independent producers. All CPB-funded radio programs 
are made
available nationally to all public radio stations. CPB continues to 
give highest con-
sideration to excellent, balanced, and innovative programming from 
diverse sources.
    In addition, all Community Service Grant recipients are required to 
use approxi-
mately 30 percent of this grant for the purpose of purchasing or 
producing program-
ming of national interest. These grants ensure the availability of some 
of the best
programming public radio has to offer by targeting use of the funds to 
the purchase
or production of national programming.
System Support Funds
    By law, CPB spends at least 6 percent of the funds it receives to 
support the public broadcasting system, as opposed to individual 
stations or producers. CPB often supplements this amount with funds 
from its administrative allocation.

    System support expenditures include:

 Interconnection grants. These are provided to public 
        television stations specifically to purchase or maintain 
        equipment allowing each local station to receive or de- liver 
        signals via satellite. By law, half of the interconnection 
        costs for television are funded with system support funds 
        through these grants.
 Music royalty fees for broadcast and Internet use for all CPB-
        funded public tele- vision and radio stations, as well as for 
        NPR and PBS.
 Operational costs for ITVS and Minority Consortia.
 Promoting work force diversity and career development for 
        minority producers.
 Financing public broadcasting award programs, strategic 
        planning, and research into new technologies.
    As advised by the stations, CPB established Future Funds for both 
television and radio. These are also funded through the system support 
account, as the Future Fund programs are intended to improve the system 
of stations and its services over-

all. For example, CPB funds are being used to support a business 
integration plan, financial analysis and an operating agreement to 
build a jointly controlled ``master control'' and ``store and forward'' 
system for a collaboration of stations in the Pacific Northwest; the 
lessons learned will be important as public broadcasters seek to pool 
resources for greater efficiency. Future Fund grants were made to 
create a portal site for all arts organizations in Wisconsin; to launch 
an on-line education service in Maryland; and to support a national 
digital TV clearinghouse.
    Over the past five years, Television and Radio Future Fund projects 
have allowed stations to learn from the best practices of others and 
either saved or raised seven dollars for every dollar invested. These 
savings and increased revenues have allowed public broadcasters to 
provide the kind of innovative, high-quality programming that continues 
to distinguish public broadcasting from other noncommercial and 
commercial broadcasting, despite our many funding challenges and 
rapidly rising costs.
CPB Administrative Operations
    In 1988, Congress set CPB's administrative budget at a fixed level 
with annual increases to be based on the Consumer Price Index or 4 
percent--whichever is higher. In no instance may the administrative 
costs exceed 5 percent of the total appropriation.
                       cpb's oversight obligation
Compliance with Funding Requirements
    The Public Broadcasting Act of 1967, as amended, and federal 
appropriations place responsibilities on CPB for the distribution, use 
and reporting of appropriated funds. This responsibility extends to 
entities receiving CPB funds. External oversight to monitor their 
compliance with CPB funding criteria is a primary responsibility of the 
Corporation. In addition to its own grant administration policies, CPB 
is aided in this regard by its Board of Directors and its Office of 
Inspector General.
CPB Board of Directors
    The CPB Board of Directors is comprised of nine members, appointed 
by the President and confirmed by the Senate. While the entire Board is 
charged with oversight, the CPB Audit Committee is the initial vehicle 
that the Board of Directors uses to discharge its oversight 
responsibilities under the laws and regulations governing the 
Corporation. Principal among these is compliance with the Public 
Broadcasting Act of 1967, as amended, and oversight of funds 
appropriated annually to public broadcasting. These responsibilities 
extend to oversight of corporate programs, functions and activities 
established to manage and control the Corporation's utilization of 
funds.
Office of Inspector General
    In 1989, the CPB's independent Office of Inspector General was 
created for the purpose of improving efficiency, economy and 
effectiveness of CPB operations and programs, and preventing and 
detecting possible waste, fraud and abuse. The CPB Board Audit 
Committee and CPB Management work with the OIG to establish a programs 
for review of the adequacy of systems of financial management and 
internal controls to ensure accurate and complete reporting, compliance 
with applicable rules and regulations, and safeguards over CPB 
resources. This includes requiring stations to submit to audits and 
keep their books in compliance with CPB policies (47 U.S.C. 
Sec. 396(l)(3)).
Compliance with Content Oversight Obligations
    Sections 396(g)(1)(a) and 396(g)(1)(d) of the Act state, ``(1) In 
order to achieve the objectives and to carry out the purposes of this 
subpart, as set out in subsection (a) of this section, the Corporation 
is authorized to:
          (a) facilitate the full development of public 
        telecommunications in which programs of high quality, 
        diversity, creativity, excellence, and innovation, which are 
        obtained from diverse sources, will be made available to public 
        telecommunications entities, with strict adherence to 
        objectivity and balance in all programs or series of programs 
        of a controversial nature . . . [and]
          (d) carry out its purposes and functions and engage in its 
        activities in ways that will most effectively assure the 
        maximum freedom of the public telecommunications entities and 
        systems from interference with, or control of, program content 
        or other activities.''
    Our current activities designed to meet these statutory 
requirements fall into four general categories:
    Soliciting Public Comment. In 1993, the CPB Board and management 
established the Open to the Public initiative in order to encourage 
viewers and listeners to voice their opinions through:

 A toll-free, 24-hour telephone line (1-800-272-2190)
 A U.S. post office box (P.O. Box 50880, Washington D.C. 20091)
 A dedicated e-mail address ([email protected])
    Virtually all public radio and television stations maintain similar 
audience response services, as do the national organizations, such as 
PBS, NPR, and PRI, as well as many other program producers and 
providers. CPB provides links to these organizations through its Web 
site. Earlier in this testimony, I discussed our plans to strengthen 
our Open to the Public initiative.
    Monitoring Public Perceptions. In addition to public comment, CPB 
considers other impartial indicators, including journalism awards, 
independent polling data and press reports, to help gauge perceptions 
of quality, as well as objectivity and balance. PBS and NPR also 
conduct regular independent surveys and focus group opinion studies, 
which we review and sometimes participate in.
    Addressing Concerns. CPB staff meet frequently with producers and 
station representatives to learn more about projects in development, 
plans for community dialogue, and special outreach efforts to ensure a 
variety of perspectives. When controversial programming generates 
public interest, CPB routinely communicates such comments to the 
appropriate producer or programmer and seeks further information or 
clarification.
    CPB Program Funding. It has been CPB's long-standing policy to 
support a wide variety of programming sources and distribution 
channels, so that local programmers--and viewers and listeners--have a 
wide number of program choices. Programming content for stations, 
therefore, comes from PBS, NPR, PRI, APT, many independent sources, and 
from local sources, including the station. Each local station 
ultimately decides which programs to carry and when to carry them, and 
decisions about controversial programs are vested, by law, in 
individual stations.
    Program proposals are evaluated on the basis of comparative merit 
by CPB staff and panels of outside experts, representing diverse 
interests and perspectives. Balance and objectivity are important 
criteria for program proposals concerning topics of a controversial 
nature. Any resulting CPB program contract requires that a recipient's 
production meet all applicable standards of journalistic ethics, 
including issues related to fairness.
                               conclusion
    Since its creation by Congress in 1967, CPB has worked diligently 
to fulfill its mission of promoting a dynamic, independent and trusted 
public broadcasting system. I believe that CPB has and continues to 
meet its obligation to help provide the American public with a range 
and quality of programming and services unrivaled by any other 
broadcast service.
    Particularly in times such as these, public broadcasting offers the 
American people a trusted source for in-depth news coverage, a safe 
haven for our children, and a public square that brings us together to 
share our experiences and look forward to our common future.
    I appreciate the opportunity to provide you with this information 
on the workings of the public broadcasting system, and I am happy to 
answer any questions you might have. Thank you very much.

[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]


    Mr. Upton. Thank you.
    Ms. Mitchell?

                    STATEMENT OF PAT MITCHELL

    Ms. Mitchell. Thank you, Mr. Chairman. As I enter my third 
year at the helm of PBS, I am grateful for this opportunity to 
hear from other shareholders in public broadcasting and to 
share with you some good news about the investment that you 
have made in PBS.
    Much has changed in the 35 years since Congress recognized 
the need for a media enterprise that was dedicated to serve the 
public rather than sell them. We believe that the need for a 
public broadcasting service is even greater today in a media 
landscape that is merging, converging, consolidating, and 
changing with new technologies.
    But what hasn't changed is how public broadcasting goes 
about delivering on its mission referenced by Mr. Burr and 
others to inform, inspire, educate, and engage. We will be 
doing all the more of this with the digital technologies, which 
Mr. Lawson will talk about later.
    I want to talk about what we are doing now and will 
continue to do that is valued by the constituents that you and 
we serve.
    To begin with, we are local. PBS is a membership 
organization with 349 local public television stations, locally 
licensed with local autonomy. In fact, in many communities 
public broadcasting is the last locally owned media enterprise.
    Now this means that the best in national and international 
content distributed by the stations by PBS is connected 
locally, and its impact is extended through educational and 
outreach activities, all grounded in a community's needs and 
values, and often in association with other community groups. 
But local stations schedule as their community sees fit.
    We call of this points of impact. Often the greatest impact 
for a PBS program is after the television is turned off. That 
is where the educational part of our mission continues.
    PBS is the top choice of American teachers for classroom 
video, more than 40,000 video clips free available. PBS is the 
leading source of free online lesson plans for America's 
teachers with more than 3,000 developed from our prime time 
programming meeting State standards. PBS is the top provider of 
distance learning with more than 5 million Americans earning 
college credit through our distance learning programs.
    Our educational mission is also front and center when you 
look at the programming we provide for children and parents. 
Three generations of parents have raised their children with 
``Sesame Street'' and ``Mr. Rogers,'' and we continue that now 
with 30 programs a week, all of them popular as well as 
educational.
    The top six shows among kids 2 to 5, the top three shows 
for kids 2 to 11, are all on PBS. And in a viewers' survey this 
spring PBS was named the trusted media brand, above all others, 
among American parents.
    Children, parents, and caregivers are also help by the 
services that PBS and its member stations provide through 
Ready-to-Learn funding which Congress saw fit to increase in 
this year's ESEA legislation.
    Again, the points of impact are measurable. Parents who 
participate in Ready-to-Learn Programs read longer and more 
often with their children, and their children watch 40 percent 
less TV.
    At an event at the White House in May, President Bush 
recognized PBS's role in education and he celebrated the Ready-
to-Learn Program. We are pleased that the First Lady has agreed 
to be the Honorary Chair for PBS's reading campaign.
    Someone once described, Mr. Chairman, PBS's programming as 
programming for the neck up. I like to go a little further down 
and include the heart, as PBS prime time series certainly 
include America's favorites.
    We are committed the diverse voices, the points of view, 
and the cultural backgrounds that mainstream media often 
overlooks. This year PBS, with funding from CPB, broadcast the 
first ever prime time drama series about a Latino family. It 
was just named the best family drama series on television by 
the Family Friendly Forum of Advertisers.
    Our charter with Congress also calls for fair and balanced 
presentation of all issues. Gratefully, our viewers' surveys, 
which we have shared with the leadership of this committee, 
indicate that our programming is largely perceived to be 
balanced and without bias.
    However, as some members of this committee have expressed 
concerns about the perception of bias, I want to assure you, 
Mr. Chairman, that we take the concerns about bias, real or 
perceived, very seriously and are committed to understanding 
them and reversing them.
    We, however, bar high on quality, too, as PBS programming 
receives more awards for journalistic excellence than other 
broadcast entity.
    I am sure this committee shares our concerns about a 
coarsening media culture with violent dramas, sexually explicit 
talk shows, mindless reality programs. It seems that television 
has gone from Ozzie and Harriett to Ozzy Osbourne, and from 
``Firing Line'' to the ``Weakest Link.''
    PBS is going to stay the strongest link. We are going to 
tackle the tough, the complex subjects that others will not, 
and those gain relevance in times of crisis, as they did after 
September 11.
    Our documentaries on Osama bin Laden and the history of the 
Muslim faith, produced months and broadcast months before the 
events of September 11, gained significance in bad times, but 
were possible because we are committed to serving in good times 
as well.
    So, Mr. Chairman, when the question is asked, do we really 
need public television when we have all these other channels 
and more to come, my answer is, ``More than ever and more to 
come with digital.'' We serve nearly 100 million Americans a 
month. On any given night, PBS has twice the audience of any 
cable channel, and 12 million visitors a week go to pbs.org, 
making it the single most visited website in the world.
    But we don't measure our impact by the numbers of people 
who watch or who come to visit our websites. We measure it by 
the relationship we have with them, the ways that our content 
and services positively impact their lives.
    So, in conclusion, Mr. Chairman, one more bit of evidence 
that supports our conviction that public broadcasting is a 
national treasure deserving this committee's support, 
appreciative of it, and looking for a vital future: The 
Japanese Public Broadcasting System recently did a wide public 
survey of all citizens in Japan, England, and the United 
States, asking questions about their public broadcaster.
    What emerged is PBS is the most trusted, most reliable, 
most valued public broadcaster in the world. Citizens, American 
citizens, who have more media choices than any others in the 
world, said PBS is necessary and a great value for the 
investment. It seems like good news at a time when investments, 
and your investment for more than three decades, has paid off, 
delivered results to the real shareholders in this enterprise, 
American citizens and viewers like you.
    Thank you, and I look forward to your questions.
    [The prepared statement of Pat Mitchell follows:]
     Prepared Statement of Pat Mitchell, President and CEO, Public 
                          Broadcasting Service
    Mr. Chairman, I am grateful for the opportunity to provide you and 
this esteemed Committee of public television stakeholders an update on 
PBS's activities and to respond to your questions.
    Much of what we know as broadcasting has changed in the 35 years 
since Congress created public broadcasting with a singular and vitally 
important mission--which we hold as strongly today as we ever have. As 
stated in the Public Broadcasting Act of 1967, it is our mission to use 
the miracles of modern communication to create miracles of teaching and 
learning; to provide a forum for diverse voices that commercial media 
might overlook or leave out; and to use our unique, non-commercial 
licenses to create content and services that inform, inspire, educate 
and engage.
    We pursue this mission today in a far different world than the one 
in which public service media came into being in this country.
    You may remember those ``dark ages'' when you actually had to get 
up out of your chair to change the channel. And in those days, there 
were only a handful of channels to choose.
    Now, there are hundreds of choices, and television is only one 
choice among other compelling forms of media: the internet, DVDs, VODs, 
TIVOs, video games, and, of course, movies and radio.
    Additionally, the media landscape is merging and converging, 
resulting in more concentration of ownership, creating ever more 
powerful gatekeepers. While at the same time, with the digital 
revolution to which this committee and PBS are committed, comes the 
promise of more choices, more interactivity, and more viewer control.
    What is PBS's role in such a media universe? I submit to this 
Committee that it is more significant, more essential than ever before.
    It is impossible in these few minutes of formal testimony to 
include all that PBS and the 349 member stations--local public 
television stations in your districts--are doing to carry out our 
special mandate, but I'd like to offer a few examples and facts to 
support this Committee's stake in our proud past, in the relevant work 
we pursue today and in the plans we have for the future . . . all based 
on the founding principles of using media to enrich the lives of our 
constituents and to impact positively the communities we serve.
    To begin, we have stayed local. In a world quite literally 
connected by an electronic nervous system, creating enormous power for 
global media companies, public television is locally-based, locally-
licensed and locally-operated.
    In fact, in many of the communities I have visited during my two-
year tenure at the helm of PBS, the local public television station is 
the last locally-owned media enterprise in the community.
    This matters. This means the best of national and international 
content, delivered and connected to a community through locally-
originated educational programs and outreach activities. This also 
means that our content and services are grounded in the community's 
needs and values.
    Most of the national programming that is broadcast on PBS is 
produced by local public television stations, and, of course, member 
stations also produce programming focused on their communities. 
Everyday in some way, public television is connecting content with 
community, and there are many powerful examples of how this can change 
lives. I could share a very large file of such stories and viewer 
responses, that would make it clear that public television is not just 
another channel to our supporters and shareholders.
    We don't do this alone. We do it in partnership with other 
community organizations, educational and cultural institutions. We do 
this with web content and curriculum materials. We do this because for 
us, the greatest value of a program is often what happens after the 
program is over and the television is turned off.
    I'm sure this Committee shares our concern about a coarsening media 
culture filled with violent dramas, sexually explicit talk shows, and 
mindless reality programs. Television has gone from Ozzie and Harriet 
to Ozzy Osborne and from Firing Line to The Weakest Link.
    Let me assure you that all of us in public television are holding 
on to our core values like a life raft in a turbulent sea.
    Those values include providing a safe haven for children and 
parents--a place to grow and learn.
    Three generations of parents have raised their children with pro-
social, entertainingly educational PBS programs like Sesame Street and 
Mr. Rogers. We continue to build on that trusted tradition today with 
programs like:

 Between the Lions--shown in independent research to 
        dramatically improve early reading skills.
 Cyberchase the first and only children's series dedicated to 
        teaching math and logic skills.
 And with some of our new and popular shows like Dragon Tales, 
        Clifford and Sagwa, we continue to expand their minds and 
        cultural horizons and improve their social skills.
    The response to these and other PBS Kids programs reminds us of the 
power of television to teach and to be a positive force with measurable 
impact:

 The top six shows among kids age 2-5 are all on PBS.
 The top three shows for all kids age 2-11 are on PBS.
 And, in our viewer survey this Spring, we found PBS to be the 
        most trusted media brand among American parents.
    This September, we are launching pbsparents.org to provide a 
comprehensive site on topics such as nutrition, health, discipline, age 
appropriate books and games, and other issues we hope will help busy 
parents.
    And through the Ready To Learn funding that Congress renewed and 
increased in this year's ESEA legislation, PBS is also continuing to 
provide direct, hands-on support to parents in the communities you and 
we serve.
    The PBS Ready To Learn service provides more than 200,000 parents, 
teachers and caregivers with free workshops, books and other resources 
to help them prepare their children for school. The results of Ready to 
Learn can make us all feel good about an investment of taxpayers' 
dollars. Again, just a few examples of impact:

 In Oregon, 3,500 migrant families are participating in a 
        program to increase their children's literacy skills.
 In Texas, volunteer tutors and caregivers are helping low-
        income students learn to read.
 Research from all the Ready To Learn programs document that 
        parents who participate read longer and more often to their 
        children, and their children watch 40 percent less TV. What TV 
        they do watch is more educational.
    Public television stations take the educational part of our mission 
to heart and while the actual services may vary, depending on the kind 
of licensee, all public television stations support educational 
efforts, formally through curriculum-based activities and school 
partnerships and informally through adult learning services. Allow me 
again a few examples of the results of this work at the local and 
national level:

 PBS is the top choice of American teachers for classroom video 
        and the leading source of online lesson plans for America's 
        schools.
 PBS provides school districts with access to an archive of 
        more than 40,000 video clips that can be used to enhance class 
        lessons.
 PBS has developed more than 3,000 online lesson plans from 
        history, science and other programs correlated to 230 national 
        and state standards.
 PBS.org's TeacherSource web site with its customized, free 
        lesson plans is used by 250,000 teachers every month.
 PBS is the top provider of distance learning offered by 
        colleges.
 More than 5 million people have already earned college credit 
        through public television.
 More than 2 million people have passed their GED exam after 
        viewing public television's video series.
    When you tally up all that PBS and our local stations do in the 
area of education, it is much broader in scope and impact than might 
have been realized and, surely, is another reason why PBS is essential 
and valued in each community.
    In an event at the White House in May, President Bush recognized 
PBS's role in education by celebrating the Ready To Learn program. He 
said, ``Our goal as a nation is to make sure that no child is denied 
the chance to grow in knowledge and character from their very first 
years. The public broadcasting system has excelled in carrying out that 
responsibility.''
    And we are so pleased that the First Lady has agreed to be the 
honorary Chair of PBS's reading campaign this fall, which will promote 
reading and literacy among all Americans.
    Someone once described PBS as ``programming from the neck up''--and 
while I agree that we focus on the educational value of all the 
programming we distribute, I would also go a little farther down and 
include the heart. Clearly, the PBS primetime schedule includes some of 
America's favorite series: Masterpiece Theatre, NOVA, Frontline, 
Antiques Roadshow, just to name a few of the ongoing series which make 
up more than 60 percent of our total primetime schedule.
    In this Congress, PBS has provided our member stations with nearly 
8800 hours of programming which includes approximately 20 percent in 
programs for children, 25 percent classified as adult education, 12 
percent public affairs, 9 percent performance and art, 7 percent 
history and news, 5 percent in science and nature, 4 percent drama and 
1 percent independent film.
    We receive about 3300 proposals a year for programs from both 
station producers as well as independents and only about 400 projects 
get selected for broadcast in primetime, and another 600 of so hours 
that come fully funded are sent out to stations for their broadcast 
however they deem best for their communities.
    Our standards are high, and we take very seriously our mission to 
bring diverse voices, points of view and cultural backgrounds that 
might be missing from mainstream media.
    This year, PBS and CPB brought to American broadcast television the 
first primetime drama series about a Latino family, American Family, 
which was just named the best family drama on television by the Family 
Friendly Forum of Advertisers, and our stations extended the value of 
this series by producing companion local programs on different 
immigrant families in their communities.
    At PBS, we are also committed to ensuring fair and balanced 
presentation of issues, according to the principles set forth by 
Congress in the Public Broadcasting Act of 1967. Gratefully, viewer 
surveys--which we have shared with the leadership of this Committee--
indicate that our programming is largely perceived to be balanced and 
without bias. For example, PBS's news program, The NewsHour with Jim 
Lehrer, is consistently ranked by viewers as the most trusted, most 
reliable and most objective of all the news programs and news channels. 
But we recognize that some members of this Committee have concerns 
about the perception of bias in some PBS programming. We are committed 
to understanding those concerns and to turning them around.
    It's also important to us that PBS programming continues to receive 
more critical acclaim and to win more awards for journalistic 
excellence than any other broadcast entity. But the highest award and 
acclaim for us and all of our producers is to know that public 
television consistently chooses to focus on the subjects and issues 
that Americans want to know and need to know, whether it is the global 
economy as in the recent series Commanding Heights or life on the 
frontier in the very popular Frontier House or reports from the 
frontlines long before the conflict is a headline.
    The importance of having a public broadcasting system with such a 
mission became poignantly clear as we responded to the unprecedented 
acts of terror on September 11.
    Mr. Chairman, 48 hours after the terrorists' strikes on New York 
and Washington, PBS served our adult audiences with the first in-depth 
profile of Osama bin Laden. PBS was able to do this--not because we had 
reporters ready with live feeds--but because our Frontline documentary 
series had produced a bin Laden profile one year before he became the 
world's most wanted man.
    In the days after the bin Laden profile was broadcast, members of 
President Bush's Cabinet, Congress and even the Queen of England 
requested copies of the documentary, and that program, along with an 
in-depth series on the history of the Muslim faith, also produced 
months before, contributed to our understanding of WHY did this happen; 
WHY were we so unprepared? WHY did they hate us so? PBS was invited to 
screen these documentaries for a rare bipartisan gathering of the House 
Republican Conference and the Democratic Caucus.
    I said then, and I remind the Committee now, that being prepared to 
serve in bad times means serving in good times as well, with the kind 
of content and services that may gain relevance because of crisis but 
were not and cannot be created only in response to one.
    And yet, in this dramatically altered and dynamic media landscape, 
you may hear the question raised from time to time, ``Do we need public 
television when we have all those cable channels and all the new 
channels that will come with digital?''
    My answer is, ``More than ever.'' Indeed, what good are more 
choices if they are just more of the same?
    While it is true that more choices slice the viewer pie thinner and 
thinner, at PBS we are committed to the depth of our relationship with 
viewers and online users rather than simply the number of them.
    Although it bears repeating that on any given night PBS has twice 
the viewers of most cable channels and on a recent Saturday night, we 
actually attracted a larger audience than the ABC network.
    And, many are surprised to learn that PBS holds a leadership 
position online as well as on television, with 12 million visitors each 
week spending an extraordinary average of 45 minutes on PBS.org. This 
makes it the most-visited dot-org site in the world.
    But while we are pleased with the numbers of viewers and visitors, 
we do not judge our success by these numbers alone. That is a 
measurement that must define success for our commercial colleagues, but 
we have an educational and public service mandate to fulfill.
    We will be putting that mandate first as we approach the promise of 
digital. You will hear much more about public television's plans for 
digital from my colleague at APTS, but let me just add that we have 
been committed to high definition programming since 1998, and starting 
this fall, nearly all PBS content will be future-proofed for high 
definition broadcast. Many of our early digital adopters are already 
multi-casting, providing new educational services and more true choice; 
in other words, added value in every format of content or service 
delivery.
    That is how I see what we do, Mr. Chairman and Members of the 
Committee. I see a singular, much-needed alternative to all other media 
enterprises that must, by design, judge their services by how much 
profit they return to their stockholders.
    Our bottom line is different. Because of your support, and the 
support of viewers like you, we can pursue the use of media, the power 
of mass communications, with a focus on public service, with a 
commitment to creating value, not for stockholders, but for all 
Americans who are in fact the real shareholders of public television 
and the Public Broadcasting Service.
    I thank the Committee and am happy to answer any questions.

    Mr. Upton. Thank you very much.
    Mr. Klose?

                    STATEMENT OF KEVIN KLOSE

    Mr. Klose. Thank you, Mr. Chairman and members. It is an 
honor to appear before you.
    Once again, in the several years that have passed since 
last we had the privilege of addressing you, audiences to 
National Public Radio across America have gone up by almost 50 
percent, from about 13 million listeners a week in 1998 to 
close to 20 million listeners a week today. In addition, we are 
on more than 150 foreign radio stations and foreign cable 
channels around the world, and we are very proud to have our 
programming on AFN, the Armed Forces Network, at every U.S. 
military installation around the world.
    The reach of NPR and its member stations reflects the 
professionalism, the dedication, and the devotion to public 
service of the 750 employees of NPR, many of whom are here in 
Washington, but are also scattered around the world in 11 
foreign bureaus, around the country in 17 domestic bureaus, and 
thousands and thousands of professional public radio employees, 
professionals, in nearly every community in America.
    With 275 member stations, which themselves control another 
400 stations, we are able to reach 99 percent of the American 
population. The population reflects in its devotion to NPR 
programming and local programming provides a weave, a mix, of 
national, local, and foreign programming that has enhanced our 
understanding of our regions, our communities, and the world 
around us.
    We look forward to the digital transition which we are just 
on the doorstep of. It will require commitments of capital 
spending by our individual stations, their communities, and we 
will look to you, we hope, for help as we go forward.
    We are surveying our stations now to determine as nearly as 
we can what the costs will be going forward, so we will be able 
to present to you an informed dialog about what our needs might 
be. We view the digital transition as an opportunity to expand 
our power to provide public service for emergency services, for 
radio reading services to those who are either visually 
impaired or who have other assisted-living needs, and other 
recognized possibilities for us to use the bandwidth in a new 
way.
    As part of our expansion at NPR, we are creating NPR West, 
a West Coast production center which will help us provide new 
programming and new content to our national listeners and also 
to connect to our stations in the West in a whole new way, so 
we can provide segments from local stations into the national 
programming stream.
    At present we are producing more than 100 hours a week of 
live and live-to-tape news programming, including the Nation's 
second and third most listened-to radio programs, ``Morning 
Edition,'' which has about 13 million listeners a week, and 
``All Things Considered,'' which has about 10 million listeners 
a week.
    We viewed these enormous opportunities to get it right, to 
be accurate, and to be as clear as we can be about balance and 
accuracy, and present to our listeners the voices, the 
diversity of all the American conversation.
    This is a partnership of professionals, its basis in every 
community in America that has a public radio station. Almost 
half our funding comes from our member stations to NPR, and 
with that we have been able together to weave an important 
national public service.
    At 9-11 last year, on September 11, Americans tuned in by 
the millions in a whole new way to their local public radio 
stations. Hundreds and hundreds of hours of special programming 
went forward in and around 9-11.
    In all this excellence, we do make mistakes. We have made 
mistakes at NPR, and we are very aware of those mistakes. We 
also are very aware of the criticism which comes our way from 
listeners because public radio serves so many different parts 
of every part of the community in America.
    One mistake we made was in mishandling our report about 
TVC, the Traditional Values Coalition. Congressman Pickering 
and his colleagues Mr. Davis and Mr. Bass have said that we 
should apologize. Mr. Chairman and members, I accept that 
invitation.
    Ms. Lafferty and TVC, you have my personal and professional 
apology. We are sorry to have made that mistake, and we hope to 
go forward from there. We will go forward at NPR and our member 
stations.
    Mr. Chairman, I want to finish, if I could, with a return 
to 9-11. We have a brief tape here composed of some of the 
voices that we and our great member station, WNYC in New York 
City, were able to put on the air in the middle of the 
catastrophic attacks on America on the 11th of September.
    Mr. Chairman and members of the committee and colleagues 
here, I would say to you that this recording, only a tiny 
sample of what NPR and its member stations do every day, I 
think is a clear indication of our commitment to do the best 
possible presentation of news, information, and analysis to 
Americans today, tomorrow, and well into the future. Thank you 
very much.
    [The prepared statement of Kevin Klose follows:]
 Prepared Statement of Kevin Klose, President and CEO, National Public 
                                 Radio
    Thank you, Chairman Upton and Ranking Member Markey, for inviting 
me to testify today on behalf of National Public Radio (NPR). As 
President and Chief Executive Officer of NPR, I am pleased to come 
before the Telecommunications and Internet Subcommittee to provide an 
overview of NPR as well apprise members of two major issues facing the 
public radio community--the conversion to digital audio broadcasting 
and spectrum policy. I hope that in the near future we will also have 
the opportunity to engage in a discussion regarding reauthorization.
             npr: an established leader in broadcast media
    For the past 32 years, NPR, a non-profit company, has provided 
listeners with in-depth, news analysis and cultural programming such as 
Morning Edition, All Things Considered, Car Talk, and Talk of the 
Nation. Most recently, NPR launched The Tavis Smiley Show, a daily one-
hour magazine originating from Los Angeles. The creation of the show 
was the result of an ongoing collaboration between NPR and a consortium 
of African-American public radio stations, including WCLK-FM, Atlanta, 
GA; WNCU-FM, Durham, NC; WJSU, Jackson, MS; and WEAA, Baltimore, MD.
    Deploying over 300 professional reporters, editors, directors, 
producers, engineers, and managers, NPR news is a premier 24 hours-a-
day, seven days a week, news service. NPR News works with 17 national 
bureaus and 11 foreign bureaus. NPR News also works with member public 
radio stations nationwide to expand and supplement national news 
reports and segments. This fall NPR will open its West Coast studios, 
providing even greater connectivity to the West. This local-national 
partnership is a fundamental part of the vitality of the company's 
robust and expanding news delivery network.
    We believe NPR performs a vital public service and, at its best, 
our news coverage provides for its listeners' needs, fulfilling our 
mission ``to create a more informed public--one challenged and 
invigorated by a deeper understanding and appreciation of events, ideas 
and cultures.'' This year our service was more robust than ever, 
especially after the events of September 11th. That first day, as the 
country's air traffic system was shut down, the borders closed and 
federal government offices evacuated, NPR moved rapidly to 24-hour live 
coverage, expanding its news coverage to an unprecedented level. This 
incorporated all scheduled news programs, included additional afternoon 
and late night programming and provided expanded talk shows so 
listeners could engage directly in what was going on around them. To 
mount this coverage, we marshaled the resources of NPR member stations 
around the country to generate the programming that enable us to extend 
our hours of broadcast. To give you a sense of the role NPR's coverage 
played around the world, we should note that on the day of the attacks, 
the Armed Forces Network dropped their regular programming and ran 
NPR's live coverage to U.S. military bases throughout the world. NPR 
Worldwide also provided NPR's programs to Europe, Asia, and Australia 
through the regular distribution of 140 stations and throughout Japan 
via cable.
    In recognition of this coverage, this spring the Overseas Press 
Club presented NPR with the 2001 Lowell Thomas Award for the best radio 
news for interpretation of international affairs. During the ceremony, 
the judges praised NPR for ``the best coverage of September 11th and 
the best radio coverage we have ever heard.''
    NPR also collected a Peabody Award for broadcast excellence for its 
news, cultural and online coverage of the events and aftermath of 
September 11 ``that enabled audiences to mourn and reflect upon those 
unsettled days.'' We at NPR believe that this award--more than any 
other received by NPR in recent times--is an award for the effort of 
the entire company and honors the exhaustive effort and dedicated 
professionalism of hundreds people at NPR. The award is also a tribute 
to our member stations, especially WNYC, WBUR, KQED and WAMU who worked 
with us to bring listeners 24-hour coverage of the events of September 
11. I am so happy that Laura Walker, President and CEO of WNYC, is here 
today to speak to you about public broadcasting and its important 
mission.
    The coverage also resulted in NPR's largest audience ever--
according to Arbitron's figures for last Fall, NPR's total audience 
grew by 19% to 19.5 million. This number reflects a simple but 
significant fact: in a time of national crisis, more Americans turned 
to NPR to try to understand the world we live in. The audience for 
Morning Edition alone is now as large as the total NPR audience was in 
1996. All this comes at a time when radio listening is declining and 
Americans have even more media choices. Simply put, NPR's listeners now 
outnumber the combined circulation of the top 35 U.S. daily newspapers.
                     npr--a membership organization
    NPR also serves as a voluntary membership organization that works 
in partnership with its member stations to increase member stations' 
audience, revenue, and value in their communities. Those member 
stations are independent and autonomous entities licensed to community 
organizations, local school boards, other local institutions, and 
public and private universities and colleges. The stations themselves 
originate on average 40 percent of their programming locally, and WNYC 
is a fine example of the kind of local station origination that exists 
in public radio. Such program origination is made possible in large 
part every year by general support from the federal government through 
the Corporation for Public Broadcasting (CPB). For example, in 2000, 
public radio stations received approximately 13 percent of their 
revenue on average from CPB.
    To clarify, NPR receives no direct general operating support from 
any national or local government source--indeed, NPR does not own or 
operate radio stations. However, NPR does compete, along with other 
producers, for project grants from federally funded entities such as 
CPB, the National Endowments for the Arts and Humanities (NEA, NEH), 
and the National Science Foundation (NSF). Such grants typically 
account for less than 2 percent of NPR's revenues in any given year. 
(NPR's budget is about $100 million annually.) Instead, NPR receives 
its overall funding from a variety of sources including membership 
dues, programming purchases, corporate underwriting, private foundation 
grants, distribution services, investments, and merchandising sales 
account. Finally, NPR manages the Public Radio Satellite System (PRSS), 
which provides program delivery and interconnection services to the 
public radio industry, including independent producers and 
distributors.
                         the digital landscape
    The public radio industry is at a fundamental turning point in its 
history. At the dawn of the 21st century, there are more outlets for 
media than ever before. Competition for consumers has increased 
significantly and audiences are splintering into niche markets at a 
rapid pace. Yet, media consolidations have reduced the diversity of 
voices on the radio dial at a time when there is little spectrum 
available for public radio stations to acquire.
    In addition, the digital revolution is fostering major 
technological changes in broadcast media. Radio will soon begin the 
process of changing its transmission system from analog to digital, 
which will: improve the quality of audio signals, allow public radio 
stations to evolve and expand new program offerings and services to 
listeners, and allow stations to compete with the emerging satellite 
radio industry.
    The public radio community is excited about the emerging changes in 
media and particularly in the radio industry. Despite our excitement, 
we do face some challenges. They include the cost of converting to 
digital audio broadcasting and the need for additional spectrum. I will 
now elaborate on each topic.
    Public radio stations are preparing to upgrade their equipment and 
digitize their programming in anticipation of the Federal Communication 
Commission's impending decision on the creation of a digital FM radio 
standard 1. Once the Commission issues its final rule later 
this year, public radio broadcasters will begin the expensive process 
of converting to a digital format. Based on the preliminary results of 
an ongoing NPR study, the estimated cost of conversion per station is 
about $100,000.2 That amount is solely for the cost of 
transmission and does not include the cost of digitizing production.
---------------------------------------------------------------------------
    \1\ The FCC just recently started a proceeding on daytime only AM 
IBOC technology. Industry testing is currently occurring on nighttime 
AM-IBOC technology.
    \2\ The cost per station may slightly increase or decrease once the 
final results of NPR's digital conversion survey are tabulated.
---------------------------------------------------------------------------
    Digital radio is expected to transform the radio industry and allow 
it to compete on equal footing with other digitized media. Digital 
technology will allow stations to broadcast near CD quality sound free 
of interference to listeners. It will help utilize spectrum more 
efficiently since stations will simultaneously broadcast their analog 
and digital signals using their existing analog AM and FM frequency. In 
other words, if the pending approach is sanctioned by the FCC, radio 
stations will not require additional spectrum to convert to a digital 
format unlike television stations.
    Most importantly, digital radio will afford new service 
opportunities, including the ability of a single FM station to offer 
two content services, one focused on news and information and the other 
focusing on jazz or classical music. It can also help stations offer:

 Expanded assisted-living services, such as radio reading 
        services for the print-impaired as well as radio captioning;
 Expanded public safety services such as geographically 
        targeted weather alerts, traffic safety, and national security 
        notifications;
 Foreign language programming to serve an increasingly diverse 
        America; and
 Audio-on-demand to increase user satisfaction.
    Digital radio will also enable new functions such as the ability to 
search program formats, scan selective programming, and read music 
lyrics and song titles.
    Federal funding will play an important role in the public radio 
system's conversion to digital radio technology. If an FM IBOC standard 
is adopted, many stations will plan to begin the process of converting, 
which will involve high capital costs. We look forward to working with 
this Committee to insure that such funding is available from the 
Congress and other sources. In addition, this Committee can play a 
positive role in insuring that the conversion to digital radio is done 
in a way that helps public radio enhance its service to the American 
public. We believe that the best use of digital technology and public 
spectrum is to provide multiple content streams to the public and to 
maximize the diversity of content on the radio dial. It is not clear 
that digital technology will move in this direction, but this Committee 
can help create the environment for such positive changes.
           spectrum auctions--what public radio has at stake
    One of the greatest impediments to increased public radio service 
to the American people is the lack of available spectrum. As you know, 
the Commission initially reserved the lower twenty percent of the FM 
band for noncommercial educational (``NCE'') use in the 1940s. That 
reserved spectrum is now far from adequate to meet the present and 
future needs of public radio. The reserved spectrum itself is less than 
ideal because it is immediately adjacent to television channel 6. In 
fact, demand for spectrum has been so great that reserved FM spectrum 
is unavailable in many parts of the country. Compounding the problem, 
the FCC has refused to accept applications for new full power and 
translator stations during the last few years.
    Although NCE stations are not limited to the reserved FM spectrum, 
and, in fact, are statutorily exempt from having to participate in 
spectrum auctions when applying for non-reserved spectrum, the ability 
of public radio broadcasters to obtain non-reserved spectrum is 
uncertain. Currently, the Commission is considering whether: (1) to bar 
NCEs from even applying for non-reserved spectrum, (2) to dismiss an 
NCE applicant if it conflicts with a commercial application or (3) to 
expand opportunities for entities to reserve individual FM channels. 
Unless additional spectrum is allocated for digital radio use, however, 
the opportunity for transmitting additional program services is 
limited.
    As a general policy matter, more needs to be done to preserve 
access to spectrum for public interest uses, including public 
broadcasting. Despite a specter of riches, recent spectrum auctions 
have failed to raise expected amounts or have been mired in litigation 
or administrative gridlock. In addition, while spectrum auctions are, 
in many cases, an appropriate means of realizing the public's interest 
in the value of a scarce resource, other uses of spectrum may be just 
as valuable, even though the value is not readily measured in revenue.
    In the more immediate term, the reallocation of television channel 
6 to radio would address several long-standing and future needs. In 
addition, access to non-reserved spectrum must be preserved. If NCE 
applicants are barred from applying for non-reserved spectrum or forced 
to participate in spectrum auctions as the sole means of obtaining 
spectrum, public radio service to the American people--now and in the 
future--will surely suffer as a result.
                               conclusion
    Thank you for your time. I am happy to answer any questions you may 
have.

    Mr. Upton. Thank you. Go ahead and play it.
    [Audio tape is played.]
    Mr. Upton. Thank you very much. It is a day that we will 
all remember; that is for sure.
    Ms. Lafferty?

                 STATEMENT OF ANDREA S. LAFFERTY

    Ms. Lafferty. Mr. Chairman and members of the committee, on 
behalf of our Chairman, Reverend Lou Sheldon, and the 
Traditional Values Coalition 43,000 member churches, I 
appreciate the invitation to appear here today as the committee 
seeks to expose the anti-Christian, anti-conservative, and 
anti-traditional values bias of National Public Radio. Thank 
you for providing a forum to publicly expose the reprehensible 
and libelous actions of the taxpayer-funded NPR.
    What happened to the Traditional Values Coalition was not 
an isolated one-time slip by some low-level NPR reporter, and 
nothing had to do with a difference of opinion. The attack on 
Traditional Value Coalition has involved all levels of NPR, 
from the so-called ombudsman to the highest levels of NPR's 
management. All of them acted in concert and closed ranks to 
defend the shoddy reporting of one of their own.
    On the afternoon of January 3 I received a call from David 
Kastenbaum, a reporter for NPR, who asked me, had I been 
contacted by the FBI yet. I said, ``Well, why would you be 
calling me? Why would they be calling me?''
    And he again said, ``Has the FBI contacted you yet?''
    I asked him, ``Why would the FBI be contacting me?''
    He said, ``Because of what's going on in the Congress with 
anthrax.''
    I was outraged. I told him, ``Of course not. How in the 
world would anyone at NPR come to ask a question like that of 
Traditional Values Coalition? Why would NPR contemplate that we 
would, or could, send deadly anthrax to anyone?''
    Then he asked if I knew anyone who had been contacted by 
the FBI. I told him we were a Christian organization; we 
wouldn't mail anthrax, and we didn't know anyone that would do 
anything like that.
    When I asked the NPR reporter why he was calling 
Traditional Values Coalition, he said he had seen a press 
release from last year, August 2, in which I and Traditional 
Values Coalition criticized Senators Leahy and Daschle over 
dropping the phrase ``so help me God'' from the oath witnesses 
take before testifying in a Senate committee.
    Kestenbaum's tone was very clear. He actually believed that 
Traditional Values Coalition and the conservatives we associate 
with would mail anthrax.
    Now let's be clear about the facts. Under the majority 
leadership of Tom Daschle, a change took place in many 
committees, including the Judiciary Committee chaired by 
Senator Leahy. This change was that witnesses are no longer 
sworn in by saying, ``so help me God.''
    We were outraged that the Senate would take God out of the 
oath and issued a press release on this change last summer. 
Because Traditional Values Coalition stood on this issue, NPR 
has persecuted us, linking us to mailing anthrax to the U.S. 
Senate and accusing us of murder.
    Clearly, we are not out of the mainstream by our comments 
attacking the Senate a year ago. This is evident by the public 
outcry over the recent Ninth Circuit Court decision removing 
``God'' from the Pledge of Allegiance.
    In addition, the Senate unanimously voted last month to 
condemn the removal of God from the Pledge. The real story here 
is what this Senate has done to strip God from the oath.
    Traditional Values Coalition has been persecuted by NPR 
because of our principled stand on this issue and because of 
our religious beliefs. When I spoke to the reporter, I told him 
in no uncertain terms that I did not appreciate his 
insinuations that Traditional Values Coalition would attempt to 
murder United States Senators with whom we disagree or that 
Traditional Values Coalition would associate with cold-blooded, 
murdering criminals.
    I thought I had set this reporter straight and that would 
be the end of this nonsense. Nearly 3 weeks later, on January 
22, without a single fact or witness or shred of evidence to 
support the accusation against Traditional Values Coalition, 
NPR aired a wholly false and defamatory story which linked 
Traditional Values Coalition with the anthrax mailings to the 
U.S. Senate. By this time, two people, innocent people, had 
died and others had been hospitalized.
    The basis of NPR's story was NPR's anti-Christian bias. NPR 
interviewed a former FBI agent who had been involved in the 
Unibomber case. Keying on a comment he had made about tracking 
correspondence from criminals to their victims, NPR's libelous 
story segways from the Unibomber to the Traditional Values 
Coalition, to abortion clinics receiving anthrax.
    NPR took the FBI's statement on how to investigate cases 
similar to the anthrax case and created a supposition that 
sounded good to them: that Christians who disagree with 
Senators would mail anthrax to those Senators.
    The story which aired on the 22nd with the headline, 
``Speculation on the Perpetrator of the Anthrax Letters,'' 
contained the following statement: ``Two of the anthrax letters 
were sent to Senators Tom Daschle and Patrick Leahy, both 
Democrats. One group who had a gripe with Daschle and Leahy is 
the Traditional Values Coalition, which before the attacks had 
issued a press release criticizing the Senators for trying to 
remove the phrase `so help me God' from the oath. The 
Traditional Values Coalition, however, told me the FBI had not 
contacted them and then issued a press release saying NPR was 
in the pocket of the Democrats and trying to frame them. But 
investigators are thinking along these lines.'' NPR claims to 
broadcast to an audience of 8 million listeners every day. 
Well, we are still waiting for those 8 million listeners to 
hear a true retraction.
    The fact that NPR doesn't understand our outrage and merely 
mocks our concerns shows how deep and pervasive the NPR 
organizational bias is against Christians and conservatives. It 
is time for Congress to say, ``No more'' to NPR. NPR has 
betrayed the public's trust.
    On behalf of our 43,000 members and the others that NPR 
smeared and defamed on January 22, I urge Congress to eliminate 
taxpayer funding for the National Public Radio. Thank you.
    [The prepared statement of Andrea S. Lafferty follows:]
     Prepared Statement of Andrea S. Lafferty, Executive Director, 
                      Traditional Values Coalition
    Mr. Chairman, on behalf of Traditional Values Coalition's 43,000 
member churches, I appreciate the opportunity to testify today. Thank 
you for providing a forum to publicly expose the reprehensible and 
libelous actions of the taxpayer funded National Public Radio.
    Traditional Values Coalition is the largest non-denominational, 
grassroots church lobby in America. Traditional Values Coalition has 
sought to empower people of faith with truth.
    With over 43,000 churches, Traditional Values Coalition has a 
diverse membership of Bible believing churches and bridges racial and 
socio-economic barriers. Our diversity is seen in the Hispanic, African 
and Asian-American churches that we represent.
    With an emphasis on the restoration of the Judeo-Christian values 
needed to maintain strong, unified families, Traditional Values 
Coalition focuses on a range of moral and social issues such as 
education, homosexual advocacy, parental rights, family tax relief, 
pornography, the right to life and religious freedom.
    While Traditional Values Coalition is a lobbying organization, its 
sister organization, Traditional Values Education & Legal Institute, is 
a foundation dedicated to educating and supporting churches in their 
efforts to restore America's cultural heritage.
    Traditional Values Coalition believes America's strength is in her 
churches. Pastors and their churches are not barred by law from being 
involved in the making of public policy. Traditional Values Coalition 
is a resource for Christians and pastors, providing education on the 
representative process.
    On behalf of our members, churches, pastors and friends, 
Traditional Values Coalition appreciates the invitation to appear here 
today as this committee seeks to expose the anti-Christian, anti-
conservative ``and anti-traditional values behavior of National Public 
Radio.
    We have been asked to tell this committee how National Public Radio 
treated Traditional Values Coalition and I appear here today to respond 
to the request.
    What happened to Traditional Values Coalition was not an isolated, 
one-time slip by some low-level National Public Radio (NPR) reporter. 
The attack on Traditional Values Coalition has involved all levels of 
National Public Radio from the so-called Ombudsman to the highest 
levels of NPR's management. All of them acted in concert and closed 
ranks to defend the shoddy reporting of one of their own.
    Many of you remember the Cheech and Chong comedy routine about 
WDRM--Dorm radio, an amateurish college radio station operated ``live 
from the basement of the science building.''
    NPR is an unfunny Cheech and Chong bankrolled by unsuspecting 
taxpayers.
    On the afternoon of January 3, 2002 I received a call from David 
Kestenbaum a reporter for National Public Radio who asked me if ``I had 
been contacted by the FBI yet?'' I said what are you talking about. He 
again asked me if I had been contacted by the FBI yet? I asked him why 
would I have been contacted by the FBI? Kestenbaum said ``because of 
what's going on in the Congress with anthrax. I still could not 
understand what he was talking about--until he explained that 
Traditional Values Coalition fit the profile of who the FBI would be 
investigating to determine who would have sent anthrax to the offices 
of Senators Daschle and Leahy. I exploded. I told him of course not. 
How in the world would anyone at NPR come to ask a question like that 
of Traditional Values Coalition. Why would NPR contemplate that we 
would or could send deadly anthrax to anyone.
    Then he asked if I knew anyone who had been contacted by the FBI. I 
really got angry and told him we are a Christian organization. We would 
not mail anthrax nor do we even know anyone who would do such a thing, 
including any of our 43,000 member churches.
    When I asked the NPR reporter why he was calling Traditional Values 
Coalition he said he had seen a press release that I had issued August 
2, 2001 in which I/ Traditional Values Coalition criticized Senators 
Daschle and Leahy over dropping the phrase ``so help me God'' from the 
oath witnesses take before testifying in a Senate committee. The NPR 
reporter stated that the press release made me and Traditional Values 
Coalition suspects in the anthrax mailings and the murders of innocent 
citizens.
    Reporter Kestenbaum's tone was very clear--he actually believed 
that I, Traditional Values Coalition, our members and other Christians 
and conservatives we associate with would mail anthrax to those with 
whom we disagree.
    Traditional Values Coalition issued a press release the next day 
alerting the American public to this malicious call. This accusatory 
call was not just an attack against Traditional Values Coalition but 
against all Bible believing Christians. Because of our political and 
moral beliefs, because we strongly oppose removing the words ``so help 
me God'' from the significant and important oaths in our nation, this 
NPR reporter construed that our public statements of belief turned our 
organization and our members into suspects in a criminal investigation.
    I was alarmed that NPR would attempt to link acts of domestic 
terrorism to Traditional Values Coalition, acts which had resulted in 
the murder of innocent Americans.
    My conversation with the NPR reporter was quite heated. In no 
uncertain terms I let him know I did not appreciate his insinuations 
that Traditional Values Coalition would attempt to murder United States 
Senators with whom we disagree or that Traditional Values Coalition 
would associate with cold blooded murdering criminals. I thought I had 
set this reporter straight and that would be the end of this nonsense.
    The following day we released a statement condemning the biased 
call from NPR.
    Then NPR ratchet-up their assault against Traditional Values 
Coalition and me.
    The very person who is supposed to look out for the interests of 
the public, the NPR Ombudsman Jeffrey Dvorkin, joined the NPR smear 
bandwagon against me, Traditional Values Coalition and our 43,000 
churches.
    In an interview with CNSNews.com Dvorkin said, ``My sense is that, 
Ms. Lafferty overstated the case. I think that Kestenbaum was just 
doing a normal story. He was not accusing anyone of anything.''
    The ombudsman is supposed to be the public's representative to 
NPR--not an apologist for NPR misdeeds. But certainly, that is not the 
role Mr. Dvorkin played in this situation.
    Maybe NPR considers smearing Christians a normal story but Members 
of Congress do not, taxpayers do not and millions of Christians do not.
    Nearly three weeks later, on January 22, 2002, without a single 
fact or witness or a shred of evidence or to support the accusation 
against Traditional Values Coalition, NPR's Morning Edition hosted by 
Bob Edwards aired a wholly false and defamatory story which linked 
Traditional Values Coalition with the anthrax mailings to the United 
States Senate. By this time 2 innocent people had died and others had 
been hospitalized.
    And the basis for this linkage? The press release which I/
Traditional Values Coalition had issued which stated our opposition to 
removing ``so help me God'' from the oath.
    The NPR story begins with an interview of a former FBI agent who 
had been involved in the Unabomber case. Keying on a comment he made 
about tracking correspondence from criminals to their victims, NPR's 
libelous story segues from the Unabomber to Traditional Values 
Coalition to abortion clinics receiving anthrax.
    The story which aired on January 22, with the headline 
``Speculation on the perpetrator of the anthrax letters,'' contains the 
following statement:
          Two of the anthrax letters were sent to Senators Tom Daschle 
        and Patrick Leahy, both Democrats. One group who had a gripe 
        with Daschle and Leahy is the Traditional Values Coalition, 
        which, before the attacks, had issued a press release 
        criticizing the senators for trying to remove the phrase `so 
        help me God' from the oath. The Traditional Values Coalition, 
        however, told me the FBI had not contacted them and then issued 
        a press release saying NPR was in the pocket of the Democrats 
        and trying to frame them.
          But investigators are thinking along these lines . . .''
    Eight million NPR listeners heard Traditional Values Coalition 
linked to criminal activity--all because of our beliefs which we 
publicly and proudly assert. All because we believe the oath taken in 
this nation should continue to include the phrase which validates the 
oath: ``so help me God.''
    NPR's false and defamatory story fueled reporting by other left-
wing media who were and are pre-disposed to dislike Traditional Values 
Coalition. The VillageVoice under the headline ``Pick-a-Perp'' simply 
repeated the false NPR report but in its report we became ``the anti-
abortion Traditional Values Coalition.''
    The left wing OC Weekly in California jumped on the NPR bandwagon. 
It complained that TVC directed a ``rash of ----'' against NPR and 
concluded that if the war on terrorism is going to be taken seriously 
it should be investigating ``groups like TVC . . .''
    Eight days later on January 29, after receiving a number of 
responses from people who were outraged by their story, NPR aired a 
statement in its ``letters'' segment acknowledging ``inappropriate'' 
reporting in a story which had been aired on their ``Morning Edition'' 
program on Jan 22. No retraction of the false statement was included in 
the ``letter''; no apology to Traditional Values Coalition for 
impugning our organization was included in the statement and nowhere in 
the statement does NPR explain why the report was aired without a 
single supporting fact or source.
    Following this pathetic statement which was a non-apology and non-
retraction Traditional Values Coalition sent a letter to NPR President 
and CEO Kevin Klose informing him that the statement NPR aired was 
insufficient and unacceptable.
    NPR apparently believes there is more than one standpoint. This is 
outrageous. There is only one standpoint--NPR smeared Traditional 
Values Coalition and its 43,000 member churches and they have yet to 
say they were wrong and they have yet to publicly say they are sorry.
    NPR did remove the story from its archived stories on its website. 
Current Magazine which covers public broadcasting reported on March 11, 
2002,
          ``Typically, when stories require corrections, they are 
        allowed to remain online, but NPR ``felt that the error in 
        judgment . . . was so serious that it outweighed whatever value 
        there might be in leaving the language there,'' says a network 
        spokeswoman.
    Mr. Chairman, the Congress has reacted to this injustice and it has 
reacted in a bi-partisan manner.
    You have scheduled today's hearing.
    Senator Debbie Stabenow, a Democrat from Michigan, said the FBI had 
never investigated Traditional Values Coalition as a suspect in the 
anthrax mailing and that she would keep in mind the false accusations 
when NPR 's funding is reviewed by the Congress.
    Thursday, February 28th turned into ``Expose NPR Day'' in the U.S. 
House of Representatives. A number of Members of Congress took to the 
floor to denounce NPR. Congressmen DeLay, Blunt, Foley, Calvert and 
Tiahrt all spoke eloquently on the floor about the irresponsible 
behavior of NPR.
    Majority Whip Tom DeLay called NPR's conduct ``outrageous'' and 
said NPR had ignored ``their basic responsibilities as journalists.'
    Chief Deputy Majority Whip Roy Blunt stated, ``NPR broke their 
contract with the American people by reporting hearsay as fact,'' that 
``this report was completely inaccurate and irresponsible'' and that 
``Congress should look long and hard at the recipients of taxpayer 
dollars.''
    Congressman Todd Tiahrt said, ``As we review National Public 
Radio's budget, I must express my outrage at their unethical report on 
the anthrax mailings . . . I am very concerned that their previously 
liberal bias has transformed into an all-out attack on conservative and 
Christian organizations.'''
    Also that same day the House Appropriations Labor/HHS/Education 
subcommittee held a hearing on the funding for Corporation for Public 
Broadcast, which funds NPR. The President of CPB, Robert Coonrod was 
questioned by both Subcommittee Chairman Ralph Regula and Congressman 
Randy Duke Cunningham. Chairman Regula called the incident 
``irresponsible journalism'' and described the accusation as ``libel.''
    NPR claims they broadcast to an audience of 8 million who hear from 
them everyday. Well we are still waiting for those 8 million listeners 
to hear an apology and retraction.
    In March NPR President and CEO Kevin Klose sent inaccurate letters 
to the Congress stating that NPR had issued a retraction and apologized 
to Traditional Values Coalition--but that is not accurate.
    NPR's ombudsman, Mr. Dvorkin, continued his deliberate assault 
against Traditional Values Coalition by posting on NPR's website yet 
another attack against Traditional Values Coalition and a justification 
for the libelous report.
    The basis of the NPR story was NPR's anti-Christian bias. NPR took 
an FBI statement on how to investigate cases similar to the anthrax 
case and created a supposition that sounded good to them--that 
Christians who disagree with Senators would mail anthrax to those 
Senators.
    NPR's Ombudsman said based on the Traditional Values Coalition 
release attacking Leahy and Daschle ``that ``two plus two made four.'' 
What does that mean in NPR speak?
    Clearly NPR employees graduated from the school of anti-Christian 
bigotry where their new math of 2+2=4 equates to:
    Christian organization + speaking out against Senators = MURDER. 
This is outrageous.
    NPR continues to employ the blame the rape victim tactic. NPR says 
Traditional Values Coalition is ``using NPR as a convenient 
scapegoat.'' Traditional Values Coalition is the victim here but they 
are doing whatever they can to make it seem like we are the 
perpetrators not NPR. I personally have suffered as has Traditional 
Values Coalition.
    Can you imagine being accused of murder. Traditional Values 
Coalition is not taking this egregious act by NPR lightly. Why 
shouldn't Traditional Values Coalition be outraged. The fact that NPR 
doesn't understand our outrage, and merely mocks our concerns shows how 
deep and pervasive the NPR organizational bias is against Christians 
and conservatives.
    Investigative reporting is not smearing a reputable organization. 
Without a single fact to support NPR's accusation and without a single 
person to even speculate that the accusation was true, NPR accused the 
Traditional Values Coalition of a heinous crime against our fellow 
Americans and one of our nation's most cherished institutions, the 
Congress.
    NPR broadcasts to millions of listeners everyday--we are still 
waiting and listening for them to right their wrong.
    The most galling aspect of all of this is the total hypocrisy of 
NPR.
    If some banana republic dictator was accusing leftists of a crime, 
NPR commentators would be foaming at the mouth as they denounced the 
injustice.
    But when conservative Christians are the accused--we are guilty 
until proven innocent. And even when we prove our innocence, NPR cannot 
seem to make a reasonable apology or explanation of its egregious 
breach of journalistic ethics and conduct.
    Where was the editor whose job it is to make sure that the facts 
support the story's conclusion?
    Based on this experience, it would appear that ``All Things 
Considered'' should have a footnote which explains that there may not 
be consideration given to things which are conservative or Christian. 
And NPR is public radio only in the sense that it takes the public's 
money but is seemingly not accountable to the public it is supposed to 
serve.
    It is time for Congress to say no more to NPR. NPR has betrayed the 
public's trust. On behalf of our 43,000 member churches and the others 
that NPR smeared and defamed on January 22, 2002, I urge Congress to 
eliminate taxpayer funding for National Public Radio.

    Mr. Upton. Thank you.
    Mr. Lawson?

                   STATEMENT OF JOHN M. LAWSON

    Mr. Lawson. Mr. Chairman and members of the committee, I am 
John Lawson, and I represent the local public stations.
    Our members see digital conversion as a life-and-death 
issue for public television. So I appreciate this opportunity 
to testify.
    Public stations, Mr. Chairman, are bullish on DTV, and we 
take our transition deadline very seriously. We now have 75 
stations on the air with a digital signal. This is 21 percent 
of all public stations.
    If Congress steps in with some needed support, I am 
confident the great majority of our stations will make their 
May 2003 deadline. Without increased support, the future of 
many stations, both digital and analog, is in doubt.
    Our progress so far is due to the extraordinary support 
from states, universities, foundations, businesses, and 
families. Bill Glazer, the CEO of WNEO and WEAO in Youngstown 
and Akron, Ohio, who is in the audience today, has raised 
nearly $4 million in State and private capital funds. This non-
Federal support has totaled on a national basis to date $771 
million, out of a projected $1.7 billion needed to complete the 
conversion.
    By contrast, the Federal contribution has been less than 10 
percent of the overall conversion cost. It is now time for 
Congress to do its part.
    Mr. Chairman, this is the fifth year that public 
broadcasting has come before the committee asking for you to 
authorize digital funding. During that time, our industry has 
made a number of missteps in its practices and in its 
relationship to the committee. I regret that.
    However, the fact remains, no other sector of the 
television industry is as committed to the digital conversion 
as public television. We are your local stations, and we want 
to bring a new generation of digital services to your 
constituents.
    In these last months before the DTV deadline for our 
stations, we respectfully urge the committee to move an 
authorization for continued DTV conversion funding. The success 
of DTV also involves more than funding. We need carriage of all 
our stations' digital signals on cable and DBS systems.
    Our industry for 3 years has been negotiating in good faith 
with the largest cable MSOs, but we have only two national 
agreements in hand, AOL Time Warner and Insight Communications. 
We commend these companies and applaud Michael Willner of 
Insight for his personal efforts to reach an agreement with us, 
and we appreciate the good-faith efforts or Robert Sachs at 
NCTA.
    It would be great if the other MSO CEOs shared Mr. 
Willner's values. We wouldn't need to come to the government. 
But I have to express our surprise and disappointment at really 
how difficult it has been to reach agreement with other MSOs.
    On a related issue, the FCC's very narrow interpretation of 
digital carriage requirements for primary video was devastating 
for us. Think of the impact on WGVU in Grand Rapids, Michigan 
and WGVK, Kalamazoo. They planned to multicast perhaps six 
standard definition channels, mostly for kids, education, and 
workforce training. Michael Wolenta the CEO of the stations, 
and Matt McLogan, who is the Vice President at Grand Valley 
State University, the license-holder for the stations, are with 
us in the audience today.
    The current interpretation of primary video means that five 
of their educational services are considered secondary and may 
not be available to cable digital subscribers. We can't believe 
this was congressional intent in the 1992 Cable Act, and we 
hope the current FCC will expand its definition of primary 
video.
    We also believe that reception of DTV the old-fashioned way 
through antennas is vital for the preservation of free over-
the-air television. Absent commitments from the electronics 
manufacturers to build DTV tuners into new sets, Congress may 
need to step in.
    Public stations have been able to raise the State and 
private support for DTV because of their vision for using it. 
Our stations have committed one-quarter of their bandwidth to 
formal education.
    Steve Bass, the CEO of Nashville Public Television and the 
Chairman of our Board, is in the audience today. Steve and 
other station executives have specific plans to extend their 
education services through DTV.
    Public stations like KNME in Albuquerque and Wyoming Public 
Television hold enormous promise for bringing high-speed 
digital services to rural America, which I know is a concern of 
this committee and subcommittee. But Federal funding and policy 
must also support the digital conversion of translators which 
are crucial for reaching rural populations.
    It has also become clear that our datacasting can play an 
important role in emergency communications for homeland 
security, severe weather events, and other disasters. Well 
before 9-11, as Mr. Engel and Mrs. Harman mentioned, the public 
network in Kentucky was pioneering such a system.
    It is very important to point out that public television is 
not asking you for additional spectrum to provide emergency 
services. We can utilize what Congress has already give us and 
hasten the day that the analog spectrum is freed up.
    In conclusion, Mr. Chairman, the commitment of Congress and 
other players to more fully support the DTV transition is 
crucial to the survival of public television and locally 
controlled media because we are among the last of the locally 
controlled media. If public stations are denied Federal funds 
for the DTV buildout, many stations simply will not make it.
    With adequate funding and policy support, public stations 
are prepared to usher in a new generation of digital services 
and help complete the digital transition. Thank you.
    [The prepared statement of John M. Lawson follows:]
     Prepared Statement of John M. Lawson, President and CEO, The 
               Association of Public Television Stations
    Mr. Chairman and members of the Subcommittee, I am John Lawson, 
President and CEO of the Association of Public Television Stations 
(APTS). Our member stations--among the last of the locally controlled 
media outlets left in this country--see digital conversion as a life 
and death issue for public television. So, I appreciate this 
opportunity to testify before you today.
    I would like to update you on the progress of our local stations in 
the digital transition, outline some of our continuing challenges that 
this Subcommittee is in a position to help us meet, and describe some 
of the exciting new services that digital television (DTV) enables. 
These include education, high-speed services to Rural America, and 
emergency communications to support homeland security.
  public stations: leading the broadcast industry into the digital age
    Our members, the local public television stations, respect and 
applaud the leadership of the House Committee on Energy and Commerce in 
advancing the digital transition. Our stations are bullish on DTV. They 
have plans to introduce a new generation of digital services to our 
communities. And they take the May 1, 2003 transmission deadline for 
public stations very seriously. So I think you will find our stations 
are doing all they can to begin digital service. We want to work with 
the Committee to continue to do our part to stimulate the digital 
transition.
    One benchmark of our stations' commitment to the digital transition 
is the number of public stations that have actually begun digital 
service. On May 1 of this year--the deadline for all commercial 
stations to begin digital transition--public television had almost as 
great a percentage of our stations on the air with a digital signal as 
did our commercial colleagues. This is somewhat remarkable given that 
our deadline was still one year away!
    Today, 75 public stations are on the air with DTV--21 percent of 
all public stations--and more are signing on every week. If Congress 
steps in with needed support, I am confident the great majority of 
public stations will make their May 2003 deadline. However, without 
increased support, the future of many public stations--both digital and 
analog--is in doubt.
     states and communities bearing the cost for a federal mandate
    I wish I could say that our success to date in meeting the federal 
DTV mandate is largely due to federal support. Unfortunately, that is 
not the case. So far, the progress of public stations is mostly due to 
extraordinary support from states, universities, foundations, 
corporations, local businesses, and individuals. This non-federal 
support has totaled $771 million to date. Given that DTV conversion is 
a federal mandate, the willingness of states and private donors to 
contribute on the scale they have is even more impressive. It is a 
clear testament to the continuing support that public broadcasting 
enjoys among the people of our country.
    Federal support, though greatly needed and appreciated, has been 
slower in coming. Last year, Congress, with the support of the Bush 
Administration, provided the first federal funding specifically 
targeted to the digital transition. We applaud Congress and President 
Bush for providing this much-needed assistance. With $45 million 
appropriated last year to CPB for DTV conversion, plus grants over the 
years from the existing Public Telecommunications Facilities Program 
(PTFP) and including projected PTFP grants from FY 02 appropriations, 
federal commitments to date total $158 million.


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    However, the total conversion cost for public broadcasting is $1.7 
billion. Federal funding so far is 17 percent of total conversion funds 
raised by our stations and less than 10 percent of public 
broadcasting's overall conversion cost. Most stations still are far 
from home in securing the funds they need to complete the digital 
transition.
    Many of our stations already on the air also are depending on 
additional federal funds. Many are operating at low power and/or lack 
the technical means to originate local programming and services. They 
need help in reaching full power to replicate their existing analog 
coverage as mandated by the FCC and to provide the full range of 
services that DTV enables.
    In asking for increased federal support, let me make clear that we 
never have asked Congress to fully cover our digital conversion cost or 
even a majority of it. We have asked for federal matching funds equal 
to approximately 40 percent of the conversion cost, or $699 million. We 
still believe this is an appropriate request given the historic role of 
Congress in supporting public broadcasting facilities and the recent 
pledges by Congress to fund its own mandates. Our FY 03 appropriations 
requests include $137 million through CPB and $110 million through 
PTFP.
    These request are given greater urgency by the severe budget 
shortfalls that have beset many states. State legislatures, so far, 
have provided $476 million for the DTV transition of public station in 
their states. In many cases today, any future capital funds from states 
are predicated on a federal match. Most states that already have 
provided DTV transition support have done so in expectation of a 
federal match.



[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

                          a respectful request
    Mr. Chairman, this is the fifth year that public broadcasting has 
asked the House Energy and Commerce Committee to report out an 
authorization bill for digital funding. During that time, public 
broadcasting has made some missteps in its practices and in its 
relationship with the Committee. I regret that. Public broadcasting is 
a highly decentralized and imperfect institution in the hands of 
fallible individuals, myself included.
    However, APTS represents the local public stations, your stations, 
and no other sector of the television industry is as committed to the 
digital conversion as we are. And no other sector is as prepared to 
harness the power of DTV to serve the people of this country, including 
your constituents. We are prepared to do what we can to work with this 
Committee in achieving our mutual goals for the digital transition.
    In these last months before public television's DTV deadline, we 
respectfully urge the House Energy and Commerce Committee to move at 
least a ``rifle shot'' authorization for continued DTV conversion 
funding through CPB. We hope you will see this authorization as part 
and parcel of your decade-long efforts to make the DTV transition 
successful. We are asking you to join governors, state legislatures, 
foundations, educational institutions, businesses, and individual 
families in a public-private partnership, a collaboration to bring the 
benefits of public digital television to your constituents.
       missing: other industry players in the digital transition
    Funding is crucial for us, but it also is clear that a successful 
digital transition requires more than federal funds. Other key players 
must do their part, as well. For starters, it is imperative that public 
stations are guaranteed carriage of all their digital broadcast signals 
on cable systems and direct broadcast satellite (DBS) systems.
    Our industry, for three years, has been negotiating in good faith 
for voluntary carriage agreements with the largest cable multi-system 
operators (MSOs). However, to date, we only have two national 
agreements in hand. We signed the first agreement with AOL Time Warner 
in 2000 and a similar agreement with Insight Communications this 
spring. We thank AOL Time Warner and Insight for their leadership, and 
we commend Michael Willner, President and CEO of Insight 
Communications, for his personal efforts to reach a mutually successful 
agreement with us. We also appreciate the good faith efforts of Robert 
Sachs at the National Cable and Telecommunications Association to 
facilitate MSO agreements with public television.
    However, I would be less than candid if I failed to express our 
surprise and disappointment at how difficult it has been to reach 
agreements with more MSOs. We have been at this for three years. We 
have a joint committee of members of the APTS and PBS boards, 
volunteers who have collectively put in hundreds of hours of time 
seeking these agreements. These are hours that could be used to run 
stations, produce programming, or manage businesses and educational 
institutions that contribute directly to our economy.
    Despite this commitment of resources, we have two national 
agreements after three years. These are commendable, but the systems 
together reach just 21 percent of U.S. cable households. This slow 
progress in reaching cable carriage agreements means that we all still 
are a long way from achieving the goals for DTV receiver penetration 
established by Congress in the Telecommunications Act of 1996.
    Our inability to reach more agreements is causing our stations to 
question whether pursuing voluntary, negotiated carriage is a fruitful 
investment of their scarce resources; whether, at some point, we must 
redirect our efforts toward securing carriage through government 
intervention. Recently, the Supreme Court refused to consider an appeal 
of the carriage provisions of the Satellite Home Viewer Improvement 
Act. This is additional, strong evidence to us that mandatory carriage 
is a constitutionally valid policy approach for public television 
stations.
       primary video: crucial carriage issue for public stations
    Looking ahead to a post-transition environment, a major element of 
any agreement or mandate for the carriage of public television stations 
is that MSOs and DBS operators carry the full digital signal of each 
public station. The January 2001 decision by the FCC on the issue of 
``primary video'' carriage requirements was devastating for public 
television. As you know, a majority of commissioners sitting then 
decided reluctantly, as a matter of statutory interpretation, that 
cable operators would only be required to carry a single programming 
stream from a public digital television station.
    The former Commission's decision creates a fundamental problem for 
public television. That's because nearly all public stations are 
planning to multicast several channels simultaneously, at least during 
the daytime. The current interpretation of ``primary video'' makes 
these plans mute for serving cable subscribers.
    WGVU-TV/Grand Rapids, MI is one of the best examples in our system 
of the importance of multicasting and full carriage of the digital 
signals of public stations. WGVU, licensed to Grand Valley State 
University, plans to multicast perhaps six channels in standard 
definition during daytime hours. SDTV services include a K-12 
instructional channel, a ``Ready to Learn'' children's channel, a news 
and business information service, and a workforce development channel.
    Today, through its analog service, WGVU-TV serves a K-12 student 
population of 205,000 in 99 public and non-public West Michigan school 
districts. Nearly 11,000 teachers in member school districts receive 
copies of WGVU's ITV Guidebook for use during the school year. 
Unfortunately, the future digital K-12 service on WGVU-DT may be 
excluded from cable carriage requirements if the current Commission 
does not change the former Commission's position on ``primary video.''
    The White House provides another example of why the full digital 
signal of public stations should be considered ``primary video.'' Last 
April, as Pat Mitchell states in her testimony, President and Mrs. Bush 
hosted PBS, children's television producers, and local station 
representatives in a ceremony in the East Room of the White House. As 
part of the launch of the President's ``Early Reading First''' 
initiative, the President and First Lady honored public television for 
our commitment to children's education. That was a special day, which, 
by the way, we captured in high-definition video.
    WGVU's DTV multicast plans and the President's recognition 
highlight the question before the FCC as it contemplates possible 
reconsideration of the earlier decision on primary video: what is 
``primary'' and what is ``secondary'' when it comes to public 
television's multicast programming? Are daytime multicast channels for 
children and their caregivers, or K-12 instructional programming, or 
workforce training really ``secondary'' services? We think not, and we 
are hopeful the current FCC will recognize that a broader definition of 
primary video is entirely consistent with the language of the 1992 
Cable Act; that such a broader definition is, in fact, required as a 
matter of sound public policy to enable stations to realize the full 
potential of digital technology. If the Commission fails to embrace 
multicasting within its digital must carry rules, we certainly will ask 
Congress to do so.
               dtv tuners: insurance against gatekeepers
    Beyond cable and satellite carriage and interoperability, APTS 
strongly believes that reception of digital television the old-
fashioned way--through indoor or outdoor antennas--is vital for the 
preservation of free, over-the-air television in our country. 
Guaranteeing consumers the option of disconnecting the cable or ending 
monthly satellite charges while still receiving quality television 
programming is a powerful economic tool for the viewing public.
    DTV reception in new sets is not just a matter of economics; it is 
a matter of democratic principle as well. With ever increasing media 
concentration, guaranteed access to locally controlled public stations 
via the airwaves ensures that citizens can still access a free flow of 
information. This free, non-commercial, wireless access could be a last 
line of defense in the preservation of an open, decentralized, and 
fully informed society.
    For these reasons, we believe it is imperative that set makers 
build DTV tuners into new sets, at least sets over a certain screen 
size. The All Channel Receiver Act of 1962 mandated that new sets had 
to be built to receive UHF channels, not just VHF channels 2-13. This 
law was crucial to the success of public television stations, which 
were assigned mostly UHF channels. Absent immediate voluntary 
commitments on the part of the consumer electronics manufacturers, we 
need a similar, federal policy for DTV tuners. We also need 
assurances--either through voluntary commitments or legislative 
requirements--that new sets will be ``digital cable ready'' for plug-
and-play access.
    Selling TV sets today, in the middle of the digital transition, 
that can only receive analog signals is like automakers selling cars, 
just before leaded gasoline was phased out, that could only run on 
leaded gasoline. Fundamentally, it becomes a consumer protection issue, 
another area of constant concern of the House Energy and Commerce 
Committee.
                     digital roundtables and beyond
    Mr. Chairman, public television appreciates the work of you, 
Chairman Tauzin, Mr. Dingell, Mr. Markey, and your colleagues to bring 
industry representatives together in roundtable discussions to resolve 
some of the thorny issues that are holding up the DTV transition. We 
also applaud FCC Chairman Michael Powell for the voluntary plan he 
released in early April. These efforts are steps in the right 
direction. It is very important that these efforts succeed and that 
cable and satellite operators and television set manufacturers take 
specific steps to get the digital transition on track on the consumer 
side of the equation.
    However, if these voluntary initiatives fail to produce results 
quickly, and if our own negotiations with cable continue at their very 
slow pace, it will mean to us that the marketplace has failed. At some 
point in the near future, if the federal government really wants to 
achieve its own goals for the digital transition, the federal 
government will have to step in. The digital transition was started 
through government intervention in the marketplace, and continued, 
limited government intervention may be necessary to ensure its 
completion.
            a new generation of digital services for america
    Public stations have been able to raise the extraordinary levels of 
state and private support for the DTV transition because of their 
vision of the use of this unique technology. Our stations were the 
American pioneers in high-definition production. They are actively 
planning multicast channels for education and other public services, as 
I've outlined.
    Public stations also are pioneering the use of DTV for datacasting 
to PC's. Datacasting usually means the encapsulation of Internet 
protocol (IP)-based content, such as streaming media and attached 
files, that is delivered over-the-air through the DTV bitstream. I 
would like to outline innovative applications for datacasting in three 
areas: education, rural high-speed services, and emergency 
communications. Public digital stations are beginning to move beyond 
the planning stage into actual deployment.
Education
    DTV in general, and datacasting in particular, hold enormous 
promise for improving education at all levels. In December 2000, the 
bipartisan Web-based Education Commission completed its exhaustive 
examination of the most effective uses of technology for teaching and 
learning. The commission's first policy recommendation was that 
bandwidth be made available for universal access to education and 
training at all levels.
    Public digital television can meet this goal. In fact, our stations 
have committed one-quarter of their DTV bandwidth, 4.5 megabits per 
second on average, to formal education. This is the downstream 
equivalent of three T-1 lines available to learners everywhere. The 
value of this connectivity to the nation's public schools alone equals 
$2.4 billion per year!
    Perhaps the most promising local applications for DTV delivery of 
education services are in datacasting to PC's and school local area 
networks (LAN's). Though the consumer market for DTV receivers is 
problematic, equipping schools and other institutional settings for DTV 
reception holds great near-term promise. A single antenna on a school 
roof, connected to a single DTV tuner card on a school server, can 
provide high-speed datacasting to every PC in the school. This 
application is highly suitable for employing a ``walled garden'' 
approach to provide safe, IP-based educational content to classrooms.
    Many public digital stations are currently experimenting with DTV 
datacasting for education or plan to begin soon. These include KCPT/
Kansas City, MO; KERA/Dallas; KUHT/Houston; the Nebraska Network; the 
New Jersey Network; South Carolina ETV; Twin Cities Public Television; 
UNC-TV; and WBRA/Roanoke, VA, among others.
    I am happy to report that higher education also understands the 
potential of DTV. In April, the board of the National Association of 
State Universities and Land Grant Colleges (NASULGC) voted unanimously 
to form a working group with our association, APTS. We will work to 
develop policy proposals and pilot projects around the delivery of 
post-secondary education services through public digital television. 
Our mutual goal is to extend the university through DTV, especially for 
reaching underserved and nontraditional students.
    Support for this new collaboration has come from the presidents of 
Pennsylvania State University, the University of Georgia, the 
University of New Orleans, the University of North Carolina, and the 
South Dakota School of Mines and Technology. The University of Michigan 
and the University of Wisconsin, an early organizer, also are directly 
supporting the APTS-NASULGC working group, and I am sure many other 
institutions will join them. In fact, NASULGC President Peter McGrath 
is leading the effort to include the other higher education 
associations. I would welcome the chance to more fully brief the 
Committee on our efforts at your convenience.
Rural High-speed Services
    Local public television stations serving rural areas are uniquely 
positioned to assist their communities in bridging the broadband access 
gap between rural and urban areas. The resources of the digital 
spectrum offer a cost-effective solution for the delivery of high-speed 
telecommunications services to rural communities. Public television 
stations are committed to using their digital bandwidth to bring 
advanced telecommunications services--Internet, video, or audio--to 
rural areas long before wireline solutions are available. Once 
converted to digital, public stations--combined with their network of 
translators and repeaters--can provide not only HDTV and multicast SDTV 
channels, but high-speed data for PC's as well.
    The ability of DTV to provide high-speed data wirelessly can 
provide the basis for a robust, ``asymmetric'' network. It can 
effectively leverage the existing public switched telephone network, 
built out to Rural America through decades of universal service 
policies. That's because the greatest bandwidth is typically needed for 
downstream delivery, which DTV can provide. The telephone system can 
provide the ``return path'' for a complete, interactive network.
    One of the nation's pioneers in developing high-speed services to 
rural populations is KNME/Albuquerque. Like the citizens of other 
western and mountainous states, New Mexicans rely upon translators to 
extend the reach of television signals to them over distances and 
terrain. KNME, licensed to the University of New Mexico, is working 
with other telecommunications providers in the state to plan the 
digital conversion of its translator network. Their goal is to deploy 
the network as cost-effectively as possible and establish new digital 
services and applications. KNME's engineers also are exploring options 
to make the translator conversion as spectrum-efficient as possible, 
given the constraints on new translator frequencies.
    Unfortunately, rural translator conversion has been the ``step-
child'' of federal telecommunications policy. And public television 
stations serving rural areas tend to have the most difficult time 
raising the necessary digital conversion funds. This funding divide 
threatens to deny rural Americans the many benefits of DTV. In 
addition, if rural public television stations and their system of 
translators and repeaters are not supported, as many as 12 million 
Americans could be at risk for losing their only source of free, over-
the-air educational television--digital or analog.
    That is why APTS's policy agenda specifically addresses rural 
digital conversion challenges. We are pursuing 1) federal matching 
funds for the digital transition of transmitters and translators 
serving rural areas; and 2) federal policies and rules, consistent with 
our recent petition filed with the FCC, that allow for the transition 
of translators. Given the House Energy and Commerce Committee's 
historic commitment to universal service, we look forward to working 
with you to ensure access to the benefits of DTV for all Americans.
Homeland Security
    Well before the events of last September, the public network in 
Kentucky, KET, was pioneering the use of DTV datacasting for emergency 
communications. In initial trials with the Weather Service, severe 
weather alerts were sent to PC's at first responder locations equipped 
with DTV tuner cards and antennas. The trials, using KET's digital 
transmitter in Louisville, proved highly successful. It became clear 
that DTV can provide important new applications for homeland security. 
KET, partnering with the Kentucky State Police and other first 
responders, is now deploying its emergency communications system 
statewide.
    Other public stations are also pioneering the use of DTV for 
emergency communications. These include KERA/Dallas, KUHT/Houston, 
KMOS/Warrensburg, MO, in partnership with the Missouri National Guard, 
and WNYE/New York. Many more stations are in discussions with local 
emergency response officials.
    Datacasting through DTV has many advantages for public safety 
services. Transmission of this data over the digital broadcast signal 
decreases minutes of alert time and information lags to just a few 
seconds. Use of the digital broadcast infrastructure can also bypass 
the congestion of wireline and wireless services, including the 
Internet, telephone, and cellular networks, which can plague 
communications in emergency situations. And, because the datacasting is 
``addressable'' to certain computers, this system could be used to 
provide secure information to select public safety agencies and their 
first responders in the field.
    A recent report by the National Research Council, released June 25, 
provides strong policy support for leveraging the DTV transmission 
infrastructure for homeland security. The report, titled, Making the 
Nation Safer: The Role of Science and Technology in Countering 
Terrorism, recommended, among other steps, that emergency response 
capabilities be incorporated into existing infrastructure build outs. 
The following excerpt is especially trenchant for the hearing today:
          ``In a crisis, channels to provide information to the public 
        will clearly be needed. Radio, television, and often the Web 
        provide such information today, but it is usually generic and 
        not necessarily helpful to people in specific areas or with 
        specific needs. Research is needed to identify appropriate 
        mechanisms--new technologies such as `call by location' and 
        zoned alert broadcasts--for tailoring information to specific 
        locations or individuals. To be effective in interacting with 
        individual users, ubiquitous and low-cost access is required . 
        . .'' p. 5-21
    Datacasting through public digital television is extremely well-
suited to meet the NRCs requirements. It is completely scalable in 
reaching the public through set-top boxes and PC's equipped with low-
cost tuner cards. It also can provide addressable and locally-directed 
information through selective encryption of data. And it meets the NRCs 
goal for the ``dual use'' of civilian infrastructure to reduce costs.
    Very importantly, public television does not need additional 
spectrum to provide emergency services--we can utilize what Congress 
has already given us. Public television stations have already made 
significant progress toward the digital conversion. We are prepared to 
make these datacasting solutions available to the nation.
    Last month, DTV emergency capabilities were demonstrated on Capitol 
Hill by APTS, KET, and one of the leading vendors in this area, NDS, 
with their team based in Newport Beach, CA. Using the over-the-air 
bitstream of WETA-DT, simulated emergency alert scenarios were 
conducted for members of Congress and congressional staff. Other 
demonstrations and simulations are planned.
    APTS has reached out to the Committee to ensure you were aware of 
the contribution our system can make to emergency preparedness. We hope 
you will factor in our capabilities as you plan how to best assist the 
nation in this area. APTS stands ready to work with Congress and the 
Administration to complete the digital conversion and enable 
partnerships between public stations and local, state, regional and 
national public safety offices.
        recap: action requested to assist in the dtv transition
    Listed below are public television's requests of Congress for a 
partial match of local DTV conversion fundraising, as well as other 
policies to accelerate the digital television transition.

 A ``rifle shot'' authorization for DTV funding from the House 
        Energy and Commerce Committee;
 Digital funding through CPB in FY 2003: $137 million;
 Digital funding through PTFP in FY 2003: $110 million;
 Encourage and, if necessary, require carriage of the full 
        digital signals of public stations by cable and satellite 
        operators;
 Encourage the FCC to adopt a definition of ``primary video'' 
        to include all multicast streams of programming consistent with 
        congressional intent--legislate if necessary;
 Encourage and, if necessary, require that manufacturers 
        include DTV tuners in new television receivers.
    This agenda, if implemented, will ensure that public television 
stations deploy a new generation of digital services for their 
communities. It also will give a much-needed shot-in-the arm for the 
overall digital transition of the television broadcasting industry.
  fateful decisions for public television and locally controlled media
    The commitment of Congress and other players to more fully support 
the DTV transition is a life and death matter for public television and 
locally controlled media. If stations are denied federal matching funds 
for the digital transmission build out, many stations--especially those 
serving rural areas--simply will not make it. And if neither integrated 
DTV tuners, nor cable, nor satellite provide the public with ready 
access to the digital signals of public stations, our successes in 
getting digital stations on the air will mean very little. Public 
television will not survive for long if people can only receive it as a 
single-channel, analog relic in a multi-channel, digital world.
    With adequate support, however, public stations are prepared to 
usher in a new generation of digital services for their communities. We 
can make important new contributions to education, rural economic 
development, and emergency services, as we have seen. Public digital 
stations can ensure the survival of locally controlled media in this 
era of media concentration. And we can help accelerate the digital 
transition of the television industry, which will free up large blocks 
of spectrum, stimulate new industries, and pay dividends for our 
country for many years to come.
    Thank you for this opportunity to present testimony. I look forward 
to your questions.

    Mr. Upton. Thank you.
    Mr. Willner, welcome.

                  STATEMENT OF MICHAEL WILLNER

    Mr. Willner. Thank you, Mr. Chairman, and thank you for 
giving me the opportunity to testify here about how cable 
operators are, indeed, working with public broadcasters to 
facilitate the digital transition.
    I also want to welcome my colleagues from C-SPAN who are 
here covering this hearing today. You may not realize this, but 
C-SPAN is voluntarily funded by America's cable operators and 
has been since its inception. We kind of consider it our gift 
to unedited and unbiased democracy.
    Mr. Chairman, tens of millions of cable customers today 
enjoy a host of cable-created arts, entertainment, science, and 
public affairs programming. However, many Americans still look 
to public TV as their favorite source of non-commercial 
educational, informational, and public service programming. We 
recognize that.
    Given the role of public broadcasting, a number of cable 
operators have negotiated, and others continue to negotiate, 
complicated agreements with public television stations to carry 
their digital signals during this very, very complicated 
digital transition.
    For example, our company, Insight Communications, as Mr. 
Lawson has mentioned, recently announced an agreement to carry 
digital broadcast TV stations, public TV stations, in all of 
our franchise areas. Under the agreement, 31 stations are 
eligible for carriage, at their option, on virtually all of our 
cable systems throughout the Midwest.
    To create additional bandwidth and allow for such carriage, 
and it is a lot of bandwidth, Insight has invested more than 
$500 million to upgrade our cable systems. Indeed, the cable 
industry has spent over $60 billion to date, and continues to 
spend heavily, in corporate, privately funded funding to 
upgrade its networks for the digital transition.
    Many of the markets served by Insight have more than one 
public TV station. That's a complication. While competing 
bandwidth demands make it impractical to carry duplicative 
content, our agreement, in order to provide bandwidth to the 
public TV stations, in some circumstances requires multiple 
carriage of those stations.
    The give and take that we had to go through in negotiating 
this agreement highlights the value of marketplace negotiations 
in finding win/win solutions that allow us to carry the unique 
digital services offered by public broadcasters while we still 
preserve the ability to offer other advanced services that our 
customers are demanding.
    Understand this: Cable networks, even at 750 megahertz, 
have limited bandwidth, and operators must manage that fact 
very closely in their customers' best interest.
    Insight is, by no means, alone in working with public 
broadcasting. Time Warner Cable has an agreement to carry some 
140 TV stations during the digital transition. Here in the DC 
area, Comcast has negotiated directly with Channel 26 for their 
digital television signal, and 2 days ago announced yet another 
agreement in the Philadelphia market. Other major cable 
operators are negotiating with PBS stations to carry their 
digital signals.
    Mr. Chairman, when all is said and done, compelling digital 
content is what will drive the digital transition. That's why 
cable operators like Insight and Time Warner have negotiated 
MSO-wide digital carriage agreements with PBS.
    I am also proud to say that the cable industry was the 
first, and it still really the only industry, that has endorsed 
FCC Chairman Michael Powell's plan to accelerate the digital 
transition. In this regard, leading cable operators have 
committed to offer to carry high-definition and other high-
value digital broadcasts and cabled programming.
    Unfortunately, our colleagues in the commercial 
broadcasting industry continue to ask the government for more 
giveaways, in this case our property, to require us to carry 
their digital broadcast signals, as well as their analog 
signals, during the transition, with no regard whatsoever to 
the content or quality of those digital channels. Many of those 
signals will merely be a standard definition digital duplicate 
of the station's analog pictures.
    A dual must-carry policy would remove incentive for 
broadcasters to create new, innovative digital services since 
they will be guaranteed distribution, regardless of the 
programming content or quality. To their credit, public 
broadcasters seem well ahead of many of their commercial 
counterparts in recognizing the need to create differentiated 
digital programs. They have shown us their plans for compelling 
content on the digital platform and in providing ample market 
incentives to cable operators to carry those signals on behalf 
of their customers.
    Mr. Chairman, thank you very much for the opportunity to 
testify before you, and I look forward to answering your 
questions.
    [The prepared statement of Michael Willner follows:]
 Prepared Statement of Michael Willner, President and Chief Executive 
                    Officer, Insight Communications
    Mr. Chairman, thank you for giving me this opportunity to testify 
about how cable TV operators are working with public broadcasters to 
facilitate the digital television transition
    Mr. Chairman, PBS and local public broadcast stations make an 
important contribution in our society. And even though tens of millions 
of cable consumers today watch Discovery, A&E, The History Channel, C-
SPAN and a host of other cable created arts, entertainment, science and 
public affairs programming, millions of Americans, particularly those 
who do not subscribe to cable, may still rely on public broadcasters as 
their only source of non-commercial educational, informational and 
public service programming. So the cable industry recognizes the 
valuable role that public television continues to perform and commends 
public broadcasters for their pioneering public service efforts.
    Today, the vast majority of cable operators carry all local non-
duplicative public TV stations. This is in addition to all full-power 
commercial broadcast stations which cable operators also carry. For 
example, in Springfield, Illinois, Insight carries 2 public TV 
stations--WILL and WSEC. In a large market like Washington, DC, Comcast 
and Cox carry 3 PBS stations--WHUT, WMPT, and WETA--in addition to 
other independent public TV stations.
    The focus of my testimony today is on what cable operators are 
doing above and beyond what the law requires. First, I'd like to 
emphasize that during the transition to digital TV, cable operators 
will continue to carry the analog signals of local PBS stations. No 
cable customer will ever lose access to their local PBS station or 
favorite PBS program. And once the transition is complete and broadcast 
stations have returned to the government the spectrum they currently 
use for analog broadcasting, cable operators will carry the primary 
video digital signal of commercial and public broadcasters alike. 
Programs that are carried on cable in analog today will be carried on 
cable in digital in the future.
    Given the vital role played by public broadcasters and the fact 
that they are well ahead of their commercial counterparts in creating 
high value digital programming, a number of cable operators have 
negotiated, or are in the process of negotiating, agreements with 
public stations to carry their digital signals even before these 
stations return their analog spectrum.
    For example, my company, Insight Communications, recently announced 
an agreement in principle with the Public Broadcasting Service and the 
Association of Public Television Stations to carry digital broadcasts 
of local public broadcast stations in all our franchise areas. Under 
the agreement, 31 public television stations are eligible for carriage 
on systems Insight has upgraded to 750 Mhz. To create the additional 
bandwidth to allow for such carriage, Insight has invested more than 
$500 million dollars in system upgrades.
    During the transition to digital television, Insight customers will 
receive a wide array of public broadcasters digital services, including 
high definition and unique standard definition programs. Many of the 
markets served by Insight have more than one public broadcast station. 
While competing bandwidth demands make it impractical to carry 
duplicative content, our agreement provides in some circumstances for 
the carriage of multiple public stations that provide differentiated 
digital services. The give and take we went through in negotiating this 
agreement highlights the value of marketplace negotiations to finding 
win-win solutions that allow us to carry the unique digital services 
offered by public broadcasters while preserving our ability to offer 
other advanced services that consumers want.
    Insight is by no means alone in working with public broadcasting. 
The second largest multiple system operator, Time Warner Cable, has an 
agreement to carry some 140 public TV stations across the country 
during the digital transition. Here in the DC area, Comcast has 
announced plans to carry the high definition broadcast signal of 
Channel 26 WETA. And just two days ago, Comcast announced that it had 
reached an agreement to carry the digital signal of public broadcast 
station WHYY in Philadelphia.
    Collectively, these agreements between leading cable operators and 
public television stations provide for the carriage of the digital 
signals of more than 170 local public broadcasters. I believe these 
agreements are particularly noteworthy in light of the fact that today 
less than one-third of the nation's public television stations are 
transmitting a digital signal. And additionally, other cable operators 
currently are negotiating with PBS stations to carry their digital 
signals.
    Mr. Chairman, when all is said and done, compelling digital content 
is what will drive the transition to digital television. That is why 
cable operators like Insight and Time Warner Cable have negotiated 
digital carriage agreements with PBS. And it is also why the cable 
industry is so strongly committed to high definition television. We 
believe that high definition programming is the very type of compelling 
digital content that will incent consumers to make the switch to 
digital and purchase DTV equipment. Cable operators including Time 
Warner Cable, Comcast, and Charter are currently offering customers 
high definition programming in a number of markets across the country. 
Other companies, including Insight, have announced plans to introduce 
high definition services in the near future.
    Cable programmers are also the leading producers of high definition 
programming. HBO and Showtime both offer separate HD versions of their 
primary service. HBO alone provides more HD programming in any given 
week than all of the broadcast networks combined. The Madison Square 
Garden Network airs the home games of the Knicks and Rangers in high 
definition. Last month, Discovery launched Discovery HD Theater, a 24-
hour service offering the Discovery Networks' most compelling content 
in high-definition.
    The CBS and ABC broadcast networks have also made commitments to 
high definition programming. This is a good beginning. However, we 
think it is also essential that other broadcast networks and local 
stations begin to create the HDTV programs the broadcast industry 
promised Congress when it sought and obtained billions of dollars of 
public spectrum to transition to digital.
    I am proud to say that cable was the first industry to endorse the 
voluntary plan proposed by FCC Chairman Michael Powell designed to 
accelerate the digital television transition. Chairman Powell asked the 
four major broadcast networks, HBO and Showtime to provide high 
definition or compelling new digital programming during their prime 
time schedules and he asked cable operators to carry that programming. 
In May, the industry's 10 largest cable operators endorsed Chairman 
Powell's challenge by making the following commitments for systems in 
the top 100 markets that have been upgraded to 750 Mhz and serve at 
least 25,000 customers:

 By January 1, 2003, these cable operators will offer to carry 
        the signal of up to five digital commercial or public 
        television stations and/or cable networks that provide HDTV 
        programming during at least 50% of their prime time schedule or 
        a substantial portion of their broadcast week.
 As part of this digital complement, operators may offer to 
        carry other ``value added DTV programming'' that would create 
        an incentive for consumers to purchase DTV sets.
 We will also provide our customers with special HD set-top 
        boxes with appropriate digital connections.
    At Insight, we plan to meet our commitment to the Powell Plan by 
offering a mix of high definition programming offered by broadcasters 
and cable programmers as well as the digital services of local public 
broadcast stations. We believe that the digital services offered by 
local public television stations offer our customers added value.
    In the six years since the passage of the 1996 Telecommunications 
Act, the cable industry has invested more than $60 billion--or $1,000 
per cable customer--to upgrade our plant to an interactive digital 
broadband platform. Cable companies invested private risk capital to 
create a digital platform in order to offer consumers new competitive 
services--digital video, high definition television, high-speed 
Internet access, cable telephony and interactive television. However, 
even with this enormous investment, cable systems have finite capacity. 
Therefore, cable operators must maintain the flexibility to make 
choices about the use of our limited bandwidth in order to provide the 
right mix of digital services to attract customers.
    Unfortunately, some broadcasters continue to ask the government for 
favors--in this case to force cable operators to carry their digital 
broadcast signals as well as their analog broadcast signals during the 
digital transition. Rather than invest in high value digital 
programming that will attract viewers and give cable operators a 
business reason to carry them, these broadcasters seek to have the 
government expropriate valuable digital capacity that cable operators 
have just invested billions to create so that the broadcasters can 
offer duplicative analog and digital versions of the same programs. 
Consumers already enjoy very good quality analog pictures. Slightly 
better quality standard definition digital pictures are not going to 
offer consumers much more value or incent them to spend $2,000 for a 
new DTV. Quite simply, our cable consumers don't want two copies of 
every analog broadcast station they currently receive. What they want 
is digital content that is dramatically different!
    Mr. Chairman, the success of the transition to digital broadcasting 
is largely in the hands of the broadcast industry--by offering 
compelling digital content that attracts consumers and gives them a 
reason to purchase new digital television equipment, broadcasters can 
speed their own transition. To their credit, public broadcasters seem 
well ahead of many of their commercial counterparts in recognizing 
this.
    Mr. Chairman, thank you for giving me the opportunity to testify 
before your Committee. I would be happy to answer any questions you or 
your colleagues may have.

    Mr. Upton. Thank you very much.
    Ms. Walker?

                  STATEMENT OF LAURA R. WALKER

    Ms. Walker. Thank you very much, Mr. Chairman, for inviting 
me here to testify here on behalf of WNYC radio. I am very 
honored to be here to provide you with an overview of how 
public radio stations such as WNYC meet the public service 
needs of our communities.
    Let me give you a little background about WNYC. We have two 
radio stations. WNYC-AM is actually one of the very first AM 
stations established in this country. It was established in 
1924. WNYC-FM, 93.9, was one of the first FM stations. They 
were originally owned by the city of New York, and we several 
years back purchased those licenses from the city of New York 
and now are an independent, non-profit, locally run radio 
station serving the communities of New York.
    We are deeply, deeply rooted in our community. We actually 
produce 43 percent of our programming, 146 hours, of music, 
news, talk programming that is oriented to the local community. 
We also produce six national series that have an additional 
audience of 2 million.
    Our mission is to provide the highest-quality programming 
to the New York metropolitan area, programming that makes the 
mind more curious, the heart more tolerant, and the spirit more 
joyful. We are really a free classroom, an oasis, I think, 
amidst the commercial band. We take our mission to educate 
very, very seriously.
    I think no period of time better exemplifies our commitment 
to the greater New York metropolitan area than September 11 and 
the months that followed that day. Our studios and our 
broadcast facilities are located in downtown New York, downtown 
Manhattan, just about a thousand yards away from the World 
Trade Center. As Mr. Engel said, our FM transmitter was atop 
the North Tower.
    We knew about the attack as it was happening because we had 
a staff meeting going on on the 26th floor of One Centre 
Street, and our staff members saw American Airlines Flight 11 
flying and hitting the North Tower. We were actually the very 
first broadcaster, therefore, to have an eyewitness account, 
because just about within a minute and a half we had an 
eyewitness account of the attack.
    However, we also at that moment were losing our power on 
our FM station. Thankfully, our AM station, whose antenna is 
located in New Jersey, remained on the air.
    Our entire staff almost was evacuated from the building 
because of our proximity to the area. I stayed in the building 
with a skeletal crew on that day. Our reporters who were 
originally platooned to cover the primary election and were all 
around lower Manhattan phoned in reports both to us, to our 
news room and nationally. So we really were the eyes and the 
ears to the public radio community.
    One of the things that I think kept us going that day was a 
call I got from one of our staff members who, like many, many 
New Yorkers, were running from downtown Manhattan up to midtown 
Manhattan, and reported back that he had heard and seen people 
huddled around radios on street corners, listening to WNYC. 
That really kept us going.
    By the end of the day, we actually had created backup 
facilities. NPR, thank you to Kevin and his staff, really 
housed us in their midtown facilities and allowed us to have a 
backup facility there. Channel 13 took us in, PRI, Oxygen, 
Columbia University. Little did we know that we would spend the 
next 6 weeks operating from all around the city because we had 
lost contact. As you know, lower Manhattan really had lost all 
communication out of that area.
    The listener response to our coverage was tremendous. We 
received more than 30,000 letters and emails thanking us for 
our coverage. One of them from a listener, sent on September 
24, was typical. She wrote, ``I'm grateful for the astonishing, 
amazing, moving, informative, intelligent coverage you have all 
given us, a very beacon for me and others like me whose anchor 
is WNYC. I want to stress the crucial connection that brilliant 
local reporting gave us. Thank you for your bravery, 
compassion, and tenacious diligence in the face of the 
unspeakable and indescribable.''
    Since that time, we were able that next Sunday to establish 
a low-power FM transmitter on top of the Empire State Building, 
and in April to build a new transmission facility at Four Times 
Square in midtown Manhattan.
    I want to take this opportunity to thank you, Mr. Chairman, 
members of the committee, as well as the U.S. Congress, and 
particularly the New York delegation, for providing funding in 
the form of a supplemental appropriation for that new 
transmitter, and to thank CPB for their support. This support 
was greatly needed and very, very much appreciated.
    Just one word on digital, as we face that in radio: I am 
particularly excited about the opportunity that digital radio 
offers. For our AM station, it will offer, I think, the ability 
to improve the quality. For the FM station, I think it offers 
the potential of the ability to create additional program 
streams, so that we can serve our local communities with 
distinct program streams, news, and music.
    In conclusion, as an independent, locally owned, and non-
profit public broadcaster, in this age of increasing media 
consolidation in the commercial media, we have a unique role 
and one that I think is increasingly important.
    Thank you, Mr. Chairman, members of the committee, for the 
opportunity to speak to you today. I also want to thank you 
again for your generous support of WNYC and of the New York 
community after 9-11. I am happy to answer any questions.
    [The prepared statement of Laura R. Walker follows:]
      Prepared Statement of Laura Walker, President and CEO, WNYC
    Thank you, Chairman Upton and Ranking Member Markey, for inviting 
me to testify today on behalf of WNYC Radio. As President and Chief 
Executive Officer of WNYC, I am pleased to come before the 
Telecommunications and Internet Subcommittee to provide members with an 
overview of how public radio stations such as WNYC meet the public 
service needs of their communities everyday. For me, no period of time 
better exemplifies WNYC's commitment to the greater New York 
metropolitan area than September 11 and the months following that day. 
WNYC's mission is to provide the highest quality programming--
programming ``to make the mind more curious, the heart more tolerant, 
and the spirit more joyful.'' Now, more than ever, that mission is 
critical.
    Public Radio nurtures and helps sustain an informed citizenry by 
putting the necessary resources towards important coverage of national 
and international news. Public Radio provides a critically important 
independent voice as conglomerates have gobbled up the commercial 
airwaves, and media in general continues to evolve into the domain of 
fads and fluff.
    Public Radio has the power to inspire listeners, whether with music 
or information.
    It has developed a truly unique relationship with its audience and 
the community in which it broadcasts--a relationship based on respect 
and intelligence, honesty not salesmanship and on genuine interaction 
rather than superficial indulgences.
             wnyc: new york's premier public radio station
    WNYC Radio is New York's premier public radio service. It comprises 
two stations: WNYC AM 820 and WNYC FM 93.9 FM. As the nation's most 
listened-to public radio stations, WNYC AM and FM reach over a million 
listeners each week in the New York City Metropolitan area--including 
all five boroughs of New York City, Westchester, New Jersey, Long 
Island and Connecticut--and extending New York City's cultural riches 
to the entire United States and air national programming from network 
affiliates National Public Radio (NPR) and Public Radio International.
    WNYC Radio has a long and distinguished history of providing New 
York and the nation with unique news, educational, cultural, and public 
affairs programming. WNYC AM, one of the nation's oldest radio 
stations, first broadcast in 1924. WNYC FM was created 19 years later 
in 1943. Although both stations were owned by the City of New York and 
operated by the non-profit WNYC Foundation, in 1997, the WNYC 
Foundation, which was established by private citizens, purchased the 
radio licenses from City government. Today, WNYC Radio is run as an 
independent, non-profit organization.
    Since its launch in 1998, wnyc.org has produced a wide range of 
interactive programming to enhance the listening experience and solicit 
audience feedback. Those features include live, on-line access--all 
day, every day--to the AM and FM stations; archived audio of our 
programs as well as transcripts; and forums for the discussion of 
national and local events.
            wnyc's programming excellence: local & national
    WNYC is a strong local voice within the New York community and a 
national news leader. Our newsroom has produced hundreds of local 
reports for Morning Edition, All Things Considered, and Marketplace, 
and our daily flagship programs, The Brian Lehrer Show, The Leonard 
Lopate Show, Soundcheck, and New Sounds, present many live broadcasts 
and public forums.
    In addition, WNYC produces national series such as Studio 360, On 
the Media, Selected Shorts, Satellite Sisters, The Next Big Thing, and 
The Infinite Mind. These six programs are distributed to over 400 
public radio stations around the country and reach a national weekly 
audience of more than two million listeners.
    WNYC is a leading voice of independent journalism and we are 
grateful for the national reputation that we have developed for 
programming excellence. For example, in June, WNYC won six New York 
State Associated Press Broadcasters Association Awards, including the 
grand prize award: the Steve Flanders Memorial Award for the best radio 
station overall. WNYC and Sound Portrait Productions also won the 2001 
Edward R. Murrow Award for Best Documentary for A Public Radio Special 
Report: The Execution Tapes.
    Through the years, WNYC has also served as a musical and cultural 
touchstone for our listeners--from radio's very first broadcast of 
recorded classical music in 1929, to live concerts of tomorrow's avant 
garde.
                     september 11's impact on wnyc
    The events of September 11 truly challenge the commitment and 
resolve of every one of us. It is at times like these that we 
rededicate our commitment to public service. Nowhere was that more 
evident than in New York City. I want to describe to you how WNYC was 
affected and the extraordinary work that WNYC's staff did in order to 
continue to serve the people of New York during this crisis. Most 
significantly, WNYC was able to provide non-stop broadcast service 
despite having lost its transmitter in the attacks.
    First and foremost, no one on staff was hurt, although several 
witnessed the event up close. Both the FM antenna and the back-up 
antenna were destroyed by the collapse of the World Trade Center. WNYC 
was off the air on 93.9 FM for a period of 6 days, but we were able to 
broadcast on AM 820 at full power 24 hours/day.
    On September 11th, I was with a skeleton crew at One Centre Street 
where we broadcast throughout the day, until all communication and 
power in the building went down. We lost our AM signal for 
approximately two hours while we made the switch to a direct feed from 
the NPR bureau in midtown Manhattan to our AM transmitter.
    One day later, we continued to broadcast from NPR's midtown office, 
where we used makeshift studios in very small quarters. I cannot 
express strongly enough how supportive National Public Radio President 
Kevin Klose and his team were in keeping us on the air. To enable us to 
get our signal from the broadcast site to the satellite, Washington-
based NPR staff actually drove a kU-band dish to our AM transmitter, 
which is situated in New Jersey, on Tuesday night, without which our 
continued broadcast would have been near impossible. Staff at the New 
York NPR bureau also worked with us to make room for our activities so 
that we could continue to serve our listeners and the national 
community through our news reporting. And again, we are so grateful for 
the support of the entire public radio community during these difficult 
days. We temporarily relocated our administrative activities to our 
friends at WNET Channel 13 public television, and WNET also helped keep 
our web site running and our online audio streaming.
    Under these incredibly challenging circumstances, our news and 
engineering teams did an extraordinary job, not only keeping New 
Yorkers informed, but filing stories for the entire nation through NPR.
    For our FM activities, we made arrangements with another 
broadcaster to use their space on the Empire State Building to install 
a temporary FM antenna. A back-up transmitter was driven to New York 
from Illinois. We had an active low-power FM signal by the end of that 
fateful week.
    We also offered to simulcast our AM signal on WNYE-FM, the NYC 
Board of Education radio station, in order to provide the most up-to-
date information available on the rescue efforts, school closings and 
transportation changes. The Chancellor's office accepted our offer and 
we simulcast on WNYE 91.5 FM.
    In the end, many called with generous offers of help and to express 
their concern. Everyone at WNYC very much appreciated their support. I 
especially want to take this opportunity to thank you, Mr. Chairman and 
Members of the Committee, and Members of the New York Delegation, in 
particular, for providing funding in a supplemental appropriation for 
New York City. Your support was greatly needed and appreciated.
                   wnyc's commitment to the community
    After 9/11, WNYC has recommitted itself to the rich and diverse New 
York community and to youth education. WNYC has always and will 
continue to reach out into the community and seek to nurture the 
strong, active citizenry that lies at the heart of public broadcasting 
and New York City, itself. WNYC recently took the following 
initiatives:

 the expansion of Radio Rookies, an ongoing youth journalism 
        workshop training program operating in the five boroughs of New 
        York City; and
 the development of a ninth grade music curriculum in 
        consultation with the New York City Board of Education;
 the creation of Soundcheck with John Schaefer, a new daily 
        program showcasing the finest composers and performers. 
        Soundcheck brings listeners live music performed by leading 
        musicians and composers, stimulating conversation about the 
        latest trends in arts and ideas and regular updates on the 
        cultural, musical and artistic life of New York.
    In addition, WNYC continues its long-time commitment to partnering 
with New York City's cultural institutions to present live concert 
performances, many broadcast nationally, from such venues as the 
Brooklyn Academy of Music, the New York Philharmonic, American Music 
Festival, New York Guitar Festival, World Festival of Sacred Music, and 
Merkin Concert Hall.
                   the community's commitment to wnyc
    The overall revenue for WNYC in Fiscal 2001 was $23 million. 
Significantly, membership contributions rose a healthy 9% to $7.2 
million, representing 30% of the overall revenue, and the largest 
source of revenue in that year. Many of WNYC's devoted listener-members 
also serve as volunteers at WNYC's live community events and in our 
Listener Services Department.
    Underlying WNYC Radio's successes is the support of our committed, 
diverse volunteer board composed of dedicated individuals with 
backgrounds in non-profit, business, education and community service. 
The vision of these leaders has guided WNYC from city agency to 
independent organization, and will serve it well in the era of growth 
and opportunity that lies ahead.
                               conclusion
    Again, thank you, Mr. Chairman and Members of the Committee, for 
the opportunity to speak to you today. I also thank you again for your 
gracious support of WNYC and of the New York community after 9/11. I am 
happy to answer any questions you may have.

    Mr. Upton. Well, thank you very much, all of you, for your 
statements, for your participation in this morning's and this 
afternoon's hearing.
    I would like to say that, when I became chairman of this 
subcommittee, one of my very earliest meetings was, in fact, 
with my public broadcasters, and we had a lengthy discussion on 
the transition to digital and how it was going to possibly come 
about.
    I know that the appropriation process is just starting now 
in many of the subcommittees this week in terms of markups. We 
passed two bills on the floor. The Senate is way behind. 
Obviously, we have this target of May 2003. What was once a 
long ways away is now obviously not so far off--with tremendous 
costs.
    Mr. Lawson, you talked about in your testimony a total of 
$771 million that you received to date in non-Federal funds. 
I'm not sure of this, but I think the President's request in 
his budget that he submitted in February--and, again, the 
committee has not acted on it, the Appropriations Committee--I 
think he has asked for level funding, is that right, which I 
think, back of the envelope, means that you're about a billion 
dollars short. Is that about right?
    Mr. Lawson. That is about right.
    Mr. Upton. How do you connect the dots here between May of 
2003 and a billion dollar shortfall? What is your sense in 
terms of how you can continue to meet that transition, and what 
efforts are there to look at other forms of non-Federal support 
dollars?
    Mr. Lawson. Mr. Chairman, our industry has two 
appropriations requests for fiscal year 2003 that would really 
help. Through CPB, for digital transition, we are requesting 
$137 million. We are very happy to be in the President's 
budget. He is quite supportive of us in many ways, but we need 
a larger number than we were able to receive last year, as 
great as that was.
    We also have a request for PTFP, our facilities program at 
Commerce, of $110 million. We know that if Federal funds are 
put on the table, more State and private funds will come 
forward to match that. It is also very important to point out, 
we know of at least three State situations--Florida, Texas, and 
Wyoming--where State or other funds have been committed, but 
will expire, in effect, if Federal funds are not put on the 
table.
    Just to indicate an example of the demand and the fact that 
our stations are ready to go, if they can get funding, in the 
last grant round at PTFP, requests from public stations for 
digital transition--and these were matching grants--totaled 
$109 million, but PTFP could only award $33 million.
    So we have never asked Congress to cover even a majority of 
the costs of our digital conversion, but we hope that Congress 
this year can step up and do a little bit better than the 10 
percent figure we are at now.
    Mr. Upton. If it stays about where it is--let's say that 
the supplemental does not happen, things stay on the path that 
they are now, what do you think your completion rate will be by 
May 2003? How many will be on and how many will be off?
    Mr. Lawson. We think, minimum, 20 percent won't make it. 
Perhaps a third won't make it. Let me also say that, of the 
stations that have made it, including the 75 that are on now, 
many of these stations have really gotten on the air with the 
bare minimum power level and other factors to meet the FCC's 
requirements.
    We know of a lot of stations with side-mounted antennas 
that don't really cover the metropolitan area, stations that 
are operating at very low power, stations that can't originate 
local programming, but they have made the bare minimum FCC 
requirements. So you have to not only look at whether or not a 
station is technically meeting the requirements under the FCC 
and the statute, the regulations and the statute, but what are 
the next steps in terms of really building out a full digital 
capability?
    Mr. Upton. Let's go to Mr. Klose for a quick question. What 
guidelines does NPR have for underwriting to serve as a tool 
for potential funders when making a decision whether or not to 
fund public radio programs?
    Mr. Klose. Thank you, Mr. Chairman. I have those guidelines 
right here in front of me. I would be pleased to read them to 
you, if I can find them. Here we are.
    The rules for what is permissible have not changed in the 
20 years since they were established by Congress and the FCC. 
Congress' intent was to encourage public broadcasters to 
generate more revenue through non-Federal means without 
undermining our fundamental non-commercial nature.
    The basic standard against which all underwriting credits 
are judged is whether the language of the credit is descriptive 
and non-promotional. NPR, we have our own internal guidelines 
and review process to ensure that underwriting credits comply 
with the letter and the spirit of the law.
    One of our core principles and values is to remain 
independent and fundamentally non-commercial in spirit and 
practice, and we take these underwriting guidelines very 
seriously. We take seriously any concerns about commercialism. 
We believe that our underwriting practices are sound.
    Mr. Upton. Mr. Markey?
    Mr. Markey. Thank you, Mr. Chairman.
    Mr. Lawson, DTV, people aren't buying them. I had an 
amendment in this committee in 1997 that would have mandated by 
the year 2001 that no television set could be sold in the 
United States that didn't have the capacity to receive a 
digital TV signal.
    Would you support a mandate that TV sets have to be able to 
receive a digital television signal, in the same way that 
Congress in 1963 mandated that TV sets have to be able to 
receive a UHF signal, so that there could be competition and 
more choice for consumers?
    Mr. Lawson. We absolutely would support it. In fact, we are 
requesting it, if in fact the electronic manufacturers don't 
make some commitments to do just that, some voluntary 
commitments. We applaud the plan that Chairman Powell 
submitted, but between 1997 and now a lot of sets have been 
sold. We could be way down the path toward digital receiver 
penetration.
    I have to say that the All Channel Receiver Act from the 
early sixties has special relevance for public television. It, 
as you know, required that new sets over a certain size had to 
be capable of receiving channels beyond the VHF channels of 2 
through 13. They had to receive UHF channels and, since most 
public stations were assigned channels in the UHF band, it was 
crucial for the success of public broadcasting.
    We think today, Mr. Markey, that selling sets in the middle 
of the digital transition that can't receive digital signals is 
like the automakers selling cars that could only run on leaded 
fuel right as leaded fuel was being phased out.
    Mr. Markey. I agree with you, Mr. Lawson. Since you are the 
public broadcasting system, you will be the last ones that are 
able to turn off your analog signal if ordinary people who only 
have over-the-air broadcasting are dependent upon you. So the 
sooner we get to that revolution--by the way, if my amendment 
had been adopted in the committee in 1997, there would have 
been 25 million TV sets sold in 2001 and 25 million TV sets 
sold in 2002, and already 50 million homes would have the 
capacity to receive a digital signal, and we would be well on 
our way toward that revolution.
    Ms. Mitchell, I would like to congratulate you on the 
excellent system which you run. Mr. Lawson points out, quite 
correctly, that channels like WETA, Channel 26, really wouldn't 
be able to be seen by many people if we didn't have the All 
Channel Receiver Act of 1963.
    But thank God Congress passed that because let's just look 
at the good news story of the public broadcasting system. 
Here's what was on commercial television during the day all 
last week:
    On Jenny Jones, ``DNA Tests Expose Paternity''; Rikki Lake, 
``Large Women Who Believe They Can Be Models''; Maurie, ``Women 
Suspect Their Mates of Philandering.'' On the other half, 
``Dealing with Jerks,'' ``Hating a Mate's Family,'' and 
``Knowing a Man Better.'' On Montel, ``Mothers Get Makeovers'' 
and ``Educators Who Have Improper Relationships with 
Students.'' And on Jerry Springer, ``Women Out for Revenge'' 
and ``Secrets of the Strip Club.'' They could be related 
topics.
    So that is commercial television all day long, no matter 
which channel you turn to on commercial television. That is how 
they are serving the public.
    Now let's go to WETA, Channel 26, and see what they have on 
all day long. ``Teletubbies,'' this starts at 6:30 a.m. in the 
morning. We have ``Teletubbies.'' This is yesterday's 
newspaper. ``Between the Lions,'' ``Arthur,'' ``Clifford, the 
Big Red Dog,'' ``Dragon Tales,'' ``J.J. Planes,'' ``Barney and 
Friends,'' ``Sesame Street,'' ``Mr. Rogers' Neighborhood,'' 
``Barney,'' ``Clifford,'' ``Zoom,'' ``Arthur,'' ``Cyberchase,'' 
``Dragon Tales,'' ``Antiques Road Show.''
    And then we hit 6:30 at night now. It is 12 hours later on 
the public broadcasting system, and we hit this very right-wing 
program, ``Business Report'' at 6:30. Then at seven o'clock to 
8, we hit the single most respected news program on television, 
``Jim Lehrer's News Hour,'' which takes us all the way to eight 
o'clock at night, which it seems to me doesn't leave a lot of 
room for a lot of left-wing bias, to be quite frank with you, 
in the regular programming.
    Then you have this other programming that you put on 
television as well, ``Commanding Heights,'' which won just 
about every award in the history of television, maybe the most 
decorated public television show. Please run it again soon 
because I think it really helped the American people understand 
the economy a lot better.
    So I just want to congratulate you on the excellent job 
which you do. I think everyone in America appreciates that for 
a dollar per year they get quality programming that is 
unmatched by any cable show, any cable channel, that they have 
to pay for 10, 20, 30 times more in order to get into their 
home.
    I thank you, Mr. Chairman.
    Mr. Upton. Mr. Shimkus?
    Mr. Shimkus. Thank you, Mr. Chairman.
    Mr. Klose, could you burn a CD of that spot that you aired 
for the committee for me on September 11?
    Mr. Klose. Yes, sir.
    Mr. Shimkus. Yes, I would love to have that.
    Mr. Klose. Yes, sir, we would be honored.
    Mr. Shimkus. And, Ms. Walker, was there loss of life from 
the public stations?
    Ms. Walker. Not from our staff, but, as Congressman Engel 
said, Channel 13 did lose their engineer who was atop the World 
Trade Center.
    Mr. Shimkus. He was on top.
    Ms. Walker. Yes.
    Mr. Shimkus. And I have been here for the whole hearing so 
far, and I was just trying to make sure I understood that. That 
is another untold story of public service and the benefit of 
really free over-the-air public TV, which I support, and 
someone riding the Towers down and trying to broadcast this 
tremendous story.
    I also wanted to promote WSIU because they did attend the 
hearing--or the White House in May on childhood literacy, and 
have been meeting with me on the Ready-to-Learn issues. I, too, 
applaud that.
    Ms. Mitchell, as you know, Mr. Markey and I have been 
working on a Dot Kids U.S. legislation which would help provide 
what we think will be a safer location for kids, which I think 
would tie in neatly with--I know you all have pbs.org and I 
think it is very successful. My kids have been on there and 
involved with that site.
    But I would just ask for you all to look at and any help 
you can provide us in moving legislators in the other body to 
bring that up. We think that really ties very well with what 
you all are trying to do in public--you know, four of you there 
are involved in the public broadcasting business.
    Ms. Mitchell. May I say thank you for that effort. Also, 
Congress Markey, it was very kind of you to list all those 
programs that my timed testimony didn't allow me to do, and to 
thank again the committee's investment in this programming.
    PBS.ORG, Congressman, has so many parents and children who 
visit it each day that we are very concerned that everything we 
link our parents and children to is also a safe haven. We have 
bridge facilities that actually tell a child and a parent, 
``You are now leaving this non-commercial, non-profit space.'' 
We call them Web literacy pages, attempting to help children 
know how to navigate the Web.
    So any way in which we are furthering the existence of safe 
places for children and parents, PBS is extremely supportive of 
these efforts. Thank you.
    Mr. Shimkus. I want to thank the chairman. Congressman 
Upton has been very, very supportive in moving the legislation, 
but I think the whole hyperlink issue was a great concern to us 
as we started working on this concern. Because without any 
parameters, you do lose control. They may safely get into your 
site but go a site removed, and then it's the Wild West again. 
Again, any help you can give to that.
    Mr. Lawson, I enjoyed your testimony. I have actually 
pulled out a page of your ``Action Request to Desist and DTV 
Transition.'' I think there are some good talking points.
    Just the $110 million in the PTFP, that is out of the NTIA, 
is that correct?
    Mr. Lawson. Yes, sir.
    Mr. Shimkus. They are the grantees of that?
    Mr. Lawson. Right.
    Mr. Shimkus. I just want to put that, so we as a committee 
understand the appropriation.
    Now for the big question: How do we reconcile the 
difference between free over-the-air broadcast, the spectrum 
space, and my friends in the cable industry? Were is the middle 
ground in this fight? Because I think most of us understand, if 
we go digital, there's more space. There will be this analog 
transition. You are going to have more ability, but there is 
also the argument from the cable industry that, how much is too 
much? Are you all working to try to find some common ground or 
is this you are going to require us to resolve this fire, or 
are you going to allow the FCC, which neither of you may really 
want to do in the long-term?
    I will ask Mr. Lawson to go first, and if Mr. Willner will 
follow up, I would appreciate a discussion on this issue.
    Mr. Lawson. Congressman, we would greatly prefer a 
negotiated carriage agreement, arrangements. For 3 years now 
there is a joint committee of the PBS Board and the APTS Board 
that has been working with MSOs to try to reach agreements. As 
I mentioned, we secured one with AOL Time Warner in 2000. Mr. 
Willner's Insight Communications reached agreement with us 
earlier this year. We would like to have similar agreements.
    We are not marketers per se. The people on these committees 
are volunteers. They run television stations or businesses or 
make programs who are investing hundreds and hundreds of hours 
in these negotiations.
    For a number of reasons, it is complex, and we understand, 
we try to understand, the point of view of the cable industry. 
One of the sticking points is usually, how many stations in a 
multi-station market will be carried? In a market like this, 
for example, Washington, DC, there is an agreement with WETA 
and Comcast which we applaud.
    But look at the other stations we hope soon will be digital 
here. The Howard University station programs to a different 
segment of the market here, predominantly African Americans. We 
have two stations in northern Virginia, Channels 53 and 56; 53 
programs to an international community here and a lot of 
foreign news programming; 56 is an instructional channel.
    So one of the sticking points has been, and it is a 
legitimate business issue, how many of these stations will be 
carried? We are willing to work with the cable industry. We are 
not asking for any sort of duplication in carriage. But where 
distinct services exist, we believe they should be carried.
    Mr. Shimkus. Mr. Chairman, I will yield back my time if you 
will let Mr. Willner finish answering the question.
    Mr. Willner. Thank you, Congressman.
    The bandwidth capability of a 750-megahertz cable system 
has been accused of being unlimited by many broadcasters. The 
fact of the matter is we operate cable systems, many of which, 
almost all of which now, are 750 megahertz.
    We are also fulfilling the dream of the Telecommunications 
Act of 1996 by delivering a full bundle of telecommunications 
services over those networks. We are offering interactive 
digital services, video on demand, high-speed access to the 
Internet, as well as voicetelephony, the only facilities-based 
alternative to the local phone companies.
    When you do all those things on a 750 megahertz cable 
system, you fill it up. We look at our system in Louisville, 
Kentucky right now where we have 250,000 subscribers, and the 
fact of the matter is we are almost out of channel capacity 
already.
    Yet, we have come to an agreement in our markets with the 
association to carry the public broadcasting stations if they 
opt into the arrangement that we have made with them.
    When you get into much larger markets and you count how few 
digital TVs are really out there, and how difficult it is for 
consumers to make that leap because the consumer electronics 
industry hasn't yet figured out a way to put the tuners out in 
a consumer-friendly way, the problem is that we can't use up 
that bandwidth for so few people watching it at this point of 
the transition because we will be taking services away that our 
customers want, and what you wanted from the intent of the 1996 
act for us to be providing to our customers. It just isn't 
there. There is only so much blood out of that rock.
    Mr. Shimkus. Thank you, Mr. Chairman. Thank you all.
    Mr. Upton. Mr. Sawyer?
    Mr. Sawyer. Thank you, Mr. Chairman.
    Let me reiterate the second part of Mr. Shimkus' question. 
I was actually going to ask you both the same thing. But the 
second and unaddressed component was, at what point do we, as a 
Congress or the FCC, step in? Could you give us some thoughts 
about how we can do that in a way that would be least 
disruptive of the services that your customers expect?
    Mr. Lawson. We applaud the digital roundtables that the 
leadership of this committee and the full Commerce Committee 
has had with key industry players. We hope that those succeed.
    I cannot give you, Congressman, a date certain where 
basically APTS and our Board would say, ``Well, this isn't 
working. The marketplace is failing here. We have to go to 
Congress.''
    But I think the more that Congress does express its concern 
about the slow transition, the fact that cable carriage is 
absolutely required to reach the 85 percent receiver 
penetration threshold in the law for the analog channel give-
back, the more it helps us, frankly, in terms of negotiating 
these voluntary agreements.
    Mr. Sawyer. Mr. Willner?
    Mr. Willner. Congressman, let me give you another argument. 
In fact, that if Congress does find a way to force a carriage 
of digital signals over cable systems, that broadcasters are 
disincented; they have no reason to invest in new, innovative, 
sometimes expensive new programming because they are getting 
their distribution anyway.
    So, in fact, in the school of unintended consequences you 
might, in fact, be deterring consumers from going out and 
spending the money on digital televisions if you disincentivize 
broadcasters from creating the new content that you are seeking 
over digital.
    Mr. Sawyer. Thank you. I am glad I was able to give you a 
chance to say that.
    Mr. Willner. Sure.
    Mr. Sawyer. Mr. Coonrod or Ms. Mitchell, I mentioned in my 
opening statement a concern about subscriber fees, particularly 
for educational content to school systems. Given the wholly 
uneven fiscal condition of school systems across the country, 
can you comment on the potential that such subscriber services 
would have in further disequalizing the difference between have 
and have-not school districts?
    Mr. Coonrod. Do you mean subscriber fees in an individual 
environment where these would be addressable services or do you 
mean in the current situation?
    Mr. Sawyer. Well, in the case where there are specific 
dedicated subscribe-fee-driven services to school systems.
    Mr. Coonrod. Okay. Well, for example, the public television 
stations have agreed to make a quarter of their bandwidth 
available for educational services. Those would be over-the-air 
public services. There would not be subscriber fees attached to 
those kinds of services.
    Mr. Sawyer. Those aren't the services that I am talking 
about. I am talking about the ones that would have subscriber 
fees. Or am I just simply mistaken that you have no such plans 
to do that sort of thing, as an understandable effort to try 
and build revenue streams to----
    Mr. Coonrod. There are a number of plans underway. There is 
a lot of R&D work that is being done. Among those are plans 
that might include subscriber fees for certain educational 
services, but those would not replace existing free services. 
Those would be in addition to the existing free services. So 
there is nothing that would require existing services or over-
the-air services that are free of charge to add a fee to them.
    There may be new services that would be supplementary. 
Those are still in the development stage. There are none that 
are about to roll out in the next year or so.
    Mr. Sawyer. Well, you can understand my concern, that when 
we are talking about a public asset like the spectrum that we 
are talking about, that we make sure that, regardless of the 
financial condition of school districts, that they have an 
opportunity to take advantage of these new services that will 
clearly go to some school districts who are able to afford it 
and may well not go to others.
    Ms. Mitchell, do you want to comment on that?
    Ms. Mitchell. Yes, Congressman. The services that PBS 
provides, the free online lesson plans, Teacher Source, Teacher 
Line, Ready-to-Learn programs will all continue to be free and 
available to all school systems.
    Some of our adult learning services are in partnership now 
with colleges and universities. I think perhaps Mr. Lawson 
might want to speak to the business plans that are being 
developed, as Mr. Coonrod indicated, looking forward with 
digital, that might help us support additional educational 
services.
    Mr. Sawyer. Mr. Lawson?
    Mr. Lawson. Mr. Sawyer, there's a lot of models out there 
that our stations are looking at. In some cases stations have 
contracts or are entering into contracts with their State 
departments of education. These services have to be paid for 
somehow.
    The cases that Pat mentioned, there is some Federal funding 
for early childhood service. In some cases I am sure that there 
will be subscription models. We are influenced in this by the 
findings of the Web-Based Education Commission, the bipartisan 
commission which reported in December of 2000, I believe, after 
probably the most exhaustive study of what is working and what 
are the challenges to the use of technology in education and 
training.
    They made a couple of recommendations that are relevant 
here. One is that bandwidth should be made universally 
available for learning anywhere anytime. I think digital 
television can play an enormous role in meeting that goal.
    Second, they looked at the challenge of creating these new 
generations of content for specific education needs. They 
strongly endorse the concept of public/private partnerships, to 
adopt that.
    We know the schools buy textbooks. We know they are buying 
increasingly audio-visual materials. Our stations, I hope, will 
be able to fully participate in that through different business 
models.
    Mr. Sawyer. Thank you all for your answers.
    Mr. Upton. Mr. Bass?
    Mr. Bass. Thank you, Mr. Chairman.
    Mr. Klose, I have a question concerning radio, digital 
radio. We have talked quite a bit about the needs of public TV 
during the digital transition. We have talked about that more 
than we have about radio.
    Can you describe what the FCC order is likely to look like 
and what the successful radio transition to digital will 
provide, if I can use an overused quote, ``listeners like us,'' 
relative to the cost for TV?
    Mr. Klose. Mr. Bass, we expect that fairly soon there will 
be an industrywide standard promulgated by the regulatory 
authority, by the Commission. Going into that space, we are 
eager to see, and we have made such representations--basically, 
in public radio many of our member stations, there is much more 
high-quality programming right now than they have capacity to 
get to audiences. Many of our stations, even the statewide 
systems or the regional systems, have only one signal or 
virtually one signal.
    We view the digital bandwidth--we have made a proposal that 
for public radio it be allowed for us to, in effect, multiple 
in the bandwidth, and we could, in effect, get two channels in 
that space. That would help us and help our member stations 
enormously to bring forward to the community new kinds of 
programming, and programming which is already out there which 
they can't hear.
    Mr. Bass. So what you mean here, what you are saying is you 
can broadcast two different formats on the same bandwidth if 
you have digital?
    Mr. Klose. That is our proposal, yes. Yes, sir.
    Mr. Bass. Which would, in essence, double your capacity?
    Mr. Klose. That is, in effect, what is technically 
possible. That is the discussion or the presentation we have 
made.
    If that were to happen, of course, it would be enormously 
useful to the public service of our member stations. Typically, 
a local station right now may take as much as 40 percent, but 
hardly more than that, coming from other producers. Most of our 
member stations produce the majority of their quantity right in 
their local community. It is really a locally based system, 
very much so. They could expand that, and nobody is better 
qualified to serve the community at the level of community 
service than individual NPR member stations.
    Finally, we also would see in the digital transition, the 
signal, we believe it would be equally good, and there's some 
engineering discussions about this, about exactly the quality 
of it. We believe it is as good as we have now, and public 
radio stations use the analog signal in a unique way that 
allows for a very dynamic signal that has very high highs and 
low lows. It is not engineered for loudness; it is engineered 
for the nuances of the human voice and of music and of other--
--
    Mr. Bass. Is this signal, is this an expensive proposition 
you are talking about?
    Mr. Klose. The third piece I wanted to get to is, it looks 
to us, and I want to be very careful about this, but it is 
nowhere near the cost of the transition in television. I don't 
want to make a figure because I don't have it in front of me, 
and we are looking at those figures very carefully to make sure 
that they are as nearly accurate as they can be.
    One of the issues, finally, is not just the transmitters, 
but also there are going to be signal issues for antennas, for 
projecting in new ways, because of the overlap of digital and 
analog. That is a concern to us. We are trying to take a good 
survey of what those costs would be station by station.
    Mr. Bass. Technologically, though, is there a challenge 
there as well?
    Mr. Klose. There will be a challenge to make sure the 
signals are separated enough so there is no interference.
    Mr. Bass. Okay. Let me move on to Mr. Willner. Thank you 
for working with PBS. I join my colleagues in thanking you for 
working with them toward a carriage agreement.
    I believe, in response to a question asked by our chairman, 
Mr. Upton, Mr. Lawson suggested that 20 percent of the stations 
might not be transitional by 2003, and that those that do make 
it, they probably, or many of them, may not be creating local 
content or using advanced services.
    I was wondering if you had any perspectives or observations 
about that answer, and whether or not you are considering these 
issues in the context of your negotiations with PBS.
    Mr. Willner. Well, you know, we discuss very carefully with 
all content providers what it is they want to deliver to our 
consumers, because we, as the cable operators in a community, 
need to be responsive to those community desires.
    The reason why we were able to conclude a transaction with 
PBS was because they came to us with a plan. We understood the 
programming that they were delivering. We thought it was 
tremendously additive to the entire set of offerings that we 
are delivering to our digital consumer base. We, therefore, 
came to a market agreement to carry them.
    With all that said, it is still a very complicated 
discussion, one where we have to weigh the use of the bandwidth 
against the benefit to the consumer, and how many consumers are 
actually, in fact, going to be able to receive these signals.
    We think, I think, as a cable operator, that high-
definition television is a terrific way to utilize digital 
frequency. We also think that multistreaming, if we understand 
the content, and we think the content is additive, is also a 
terrific way of delivering digital signals to consumers.
    So, remember also, the cable industry, having spent $60 
billion in upgrading its plant to be able to deliver all these 
digital signals, we have to go to our congress, too, but it is 
up in New York on Wall Street. We have to ask them for money. 
So we have to be very careful that we are utilizing the 
bandwidth as best as possible.
    Mr. Bass. Thank you, Mr. Chairman.
    Mr. Upton. Mrs. Eshoo?
    Ms. Eshoo. Thank you, Mr. Chairman. Once again, thank you 
to each one of our panelists that are here today to testify. It 
is always a pleasure to hear you and to hear the progress that 
has been made from year to year on so many of these issues. 
Obviously, we are not without our problems, but I still think 
that we are moving in the right direction.
    I would like to just lay down some things for the record 
relative to Ms. Lafferty's testimony here today. I want to 
state very clearly for the record that I am glad that you are 
here. I think that this is--I not only think it; we all know 
it--this is the ``house of the people.'' Whether we agree or 
disagree on one issue or a hundred issues, this is your place 
as well, and you have an equal place at the table.
    But I would like to go through a timeline on the issue that 
you brought forward, because I find it to be disturbing in 
terms of what you stated, but there are always two sides to 
every issue.
    On January 4 of this year, NPR reporter David Kestenbaum 
called TVC, the Coalition, and spoke to you, as you testified 
today. On that same date, January 4, the Coalition issued a 
press release accusing NPR of smearing Christians, conservative 
Christians.
    Now I think that the committee members and the public 
should keep in mind that nothing had been aired on NPR. This is 
a reporter asking a question. Now I understand being asked very 
uncomfortable questions, and it can be debated as to whether it 
was a fair question, whether it was a hard-ball question, 
whether it was an appropriate question. I don't blame you for 
saying, you know, to say, ``Why would the FBI be calling me?'' 
I think if the reporter had called me, I would say the same 
thing.
    But I do question putting out a press release. Let me read 
the press release that was put out by the Coalition that date 
that you got the phone call.
    Quote: ``National Public Radio is the broadcast arm of the 
liberal establishment. The First Amendment is a one-way street 
from NPR. Their reporters have protection, but religious groups 
like ours are suspect. No wonder many in Washington refer to it 
as National People's Radio. It is a taxpayer-funded employment 
program for left-wing reporters who can't cut it in the Big 
Leagues because their bias keeps getting in the way.
    ``This is a baseless and factless attempt to smear 
conservative Christians by saying we are the moral equivalent 
of the Taliban. NPR's radio scripts are being written at the 
Democratic National Committee.''
    This is before anything was ever aired. In my judgment, I 
have to say, I think this is a little over the top. This is a 
reaction, an overreaction, to admittedly a question that you 
found inappropriate and violative, but nothing had ever been 
aired.
    On January 8, the Coalition issued a press release about 
NPR and the TVC story in The Washington Times. Again, this is 
before anything was aired.
    On January 22, NPR broadcast the Kastenbaum piece, 
mentioning his contact with the Coalition during ``Morning 
Edition.''
    On January 23, the Coalition issued a press release 
accusing NPR of implicating the organization in anthrax 
mailings.
    On January 29, NPR aired a statement, and this is 
important. Before going through this timeline, I said in my 
opening statement, ``Look, as adults, get together and iron 
this thing out.''
    On January 29, NPR aired the statement during ``Morning 
Edition,'' stating it was inappropriate for the reporter, David 
Kestenbaum, to name the Coalition on air. They said that about 
the reporter. NPR places a written copy of the retraction on 
its website.
    On January 30, the Coalition sent a letter to NPR 
President, Mr. Klose, regarding Mr. Kestenbaum's report and 
threatened legal action against NPR.
    On January 31, the day after, NPR sent its first letter to 
the TVC Chairman, Reverend Louis Sheldon, seeking to establish 
contact and resolve the matter in a mutually agreeable manner. 
TVC does not respond.
    On February 1, NPR sent its second letter to the Chairman 
to establish contact and resolve the matter in a mutually 
agreeable manner. TVC does not respond.
    On February 4, NPR sent its third letter to the Chairman 
seeking to establish contact and resolve the matter in a 
mutually agreeable manner. TVC does not respond.
    Now today I was rather moved by Mr. Klose apologizing, 
sitting right next to you, saying, ``We made a mistake. We 
apologize.''
    Christians value forgiveness. We have been taught to 
forgive. Someone has apologized, and I think that it is only in 
my humble view that that be accepted. Now you don't have to, 
and whatever, but I think that to come here to the table and 
say today--and, again, it is your prerogative to do so--that it 
is time for Congress to say, ``No more'' to NPR, on behalf of 
43,000 churches--that is a lot of churches; I don't know 
whether mine is in it, but I am a Christian--and the others 
that NPR has smeared and defamed. You are urging the Congress 
to eliminate all taxpayer support for NPR.
    Do you still, given the apology today and the 
acknowledgment, do you still hold that position, Ms. Lafferty? 
Do you or don't you? Just yes or no, because this is my time.
    Ms. Lafferty. I think that it is a little bit late.
    Ms. Eshoo. Okay, all right.
    Ms. Lafferty. There's a little bit more than just a simple 
apology, and Mr. Klose knows that.
    Ms. Eshoo. All right, so you're saying no. Let me ask you 
this: Has this been a longstanding position of the Coalition or 
is it as a result of what you brought forward today?
    Ms. Lafferty. Is what a longstanding position?
    Ms. Eshoo. Defunding, completely defunding NPR.
    Ms. Lafferty. We have had a lot of concerns about a variety 
of things. This is the first time I have testified publicly 
about it.
    Ms. Eshoo. Thank you. Thank you very much.
    I wanted to enter this into the record because I think that 
in many ways this timeline speaks for itself.
    Let me go to Mr. Lawson. How will your proposed Homeland 
Security Network enhance public safety? If it were in place on 
September 11, what would it have done? I know that trying to 
turn the hands of the clock back is always a difficult thing to 
do, but maybe in that context it would brighten and cast that 
bright light on this very important effort.
    Mr. Lawson. Well, we are definitely not offering a silver 
bullet. However, as we all know, on 9-11 it was extremely 
difficult to make a phone call here or a cell phone call. The 
Emergency Broadcasting Service was never activated. The first-
responders could not talk to each other. As I understand, the 
DC Government and Office of Personnel Management could not 
really communicate.
    What DTV offers is a very scalable, powerful, congestion-
free wireless communication source that can overcome that 
congestion. It has been clear for some time that the PC will be 
just as likely a reception device as the television or set-top 
box. You can buy off-the-shelf tuner cards for PCs for $200 or 
$300 or $400 with antennas. That is what we demonstrated that 
Mr. Engel was commenting on here in the Cannon Building.
    You could use that system to distribute alerts to the 
public. A million equipped PCs can receive it just as easily as 
one. There would be no crashing of servers or congestion.
    You can also encrypt some of the data, so that only 
authorized users would be able to access it. There would have 
to be some secure connection. In the Kentucky model I believe 
there is a connection between the Governor's office and the 
Emergency Management Agency there and the KET network.
    So there would be a server-based connection where the 
emergency authority could override whatever was being 
distributed and send out these alerts. There could be a first 
alert. They could, in effect, wake up the computer or somehow 
take priority over whatever anyone might be doing on the PC at 
that time, and then the ability of DTV to deliver massive 
amounts of data would allow you to send video, files, whatever, 
in seconds and update them, such as how to evacuate Washington, 
if it came to that, which bridges are open, CDC information, 
that kind of thing.
    Ms. Eshoo. Thank you very much. Do I have time for another 
question? No? Thank you, Mr. Chairman.
    Mr. Upton. The gentlelady's time has long expired.
    Ms. Eshoo. Thank you.
    Mr. Upton. The gentleman from Mississippi, Mr. Pickering.
    Mr. Pickering. Mr. Chairman, if I could yield my time to 
the gentleman from North Carolina, and then come back, I think 
he has a conflict that he needs to go ahead and go before me. 
So if you would, I would defer until after the gentleman from 
North Carolina speaks.
    Mr. Upton. All right, Mr. Burr.
    Mr. Burr. I thank the gentleman.
    Mr. Lawson, let me ask you, do you feel that it is 
appropriate for this committee to review the Community Service 
Grant Formula and how this formula may adversely, though 
unintentionally, affect or penalize public television stations 
that operate statewide?
    Mr. Lawson. Absolutely.
    Mr. Burr. It is appropriate?
    Mr. Lawson. Yes.
    Mr. Burr. You mentioned earlier that there were some 
mistakes that you made. Were one of those mistakes the memo 
that was entitled, ``Urgent Action Alert,'' sent out on October 
26, entitled, ``Threat to PBS Programming, Independence, and 
DTV Funding''?
    Mr. Lawson. That was one of the missteps, and I don't 
apologize at all for alerting our stations to the situation. 
Some of my wording was perhaps inappropriate.
    Mr. Burr. Well, let me ask you about some of the wording, 
and I will give you an opportunity just to clarify it for us.
    You talked in the memo about Community Service Grants. You 
said, ``Our continued success and security and DTV funds has 
been severely threatened by congressional reaction to this 
issue. Also, our industry's longstanding opposition to any 
congressional meddling in PBS programming decisions or budgets 
has been challenged.''
    Let me ask you to define for us your use of ``meddling.''
    Mr. Lawson. The meddling is something that greatly 
concerned our organization. We did not take exception to the 
Members of Congress or this committee looking at CPB grants or 
the way they distributed grants.
    However, at that time we were aware of discussions that 
would link somehow those grants to PBS dues assessments that 
they levy on their own stations.
    Mr. Burr. But this was a memo directly about a hearing. It 
was in response to the notification, or at least the unofficial 
notification, of a hearing. Granted, you mobilized your 
stations, as you should, as their representative up here.
    I guess my question is, was the fact that we were having a 
hearing meddling?
    Mr. Lawson. No, sir, we have looked forward to this hearing 
for a long time.
    Mr. Burr. Let me go on in your memo, then, if I could. On 
the second page, it said, ``Predictably, however, the hearing 
is shaping up as a catchall vehicle for airing complaints that 
certain members of the Commerce Committee have with public 
television. We have been informed that additional topics for 
discussion will include underwriting practices for programming 
and FCC rulings on ancillary and supplementary DTV services. 
This is becoming a real witch's brew.''
    Define for me your use of ``witch's brew.''
    Mr. Lawson. Well, you'll forgive the poor attempt at humor, 
but it was, the hearing was scheduled for Halloween.
    We have a responsibility to alert our members. We are a 
trade association. We represent them here in Washington, to 
alert them to not only hearings, but issues that will be 
brought before Congress or brought up in Congress. We have to 
get our stations prepared to respond to these questions. 
Underwriting guidelines, other issues, some of which were aired 
today, we have a responsibility to get our stations ready to 
answer that and to communicate with their own Members of 
Congress.
    Mr. Burr. And I understand that is the role of one who is 
paid to lobby Congress. Let me just suggest that I hope all of 
us are clear in the fact that we also have a responsibility, 
this committee specifically, a responsibility as it relates to 
the authorization of this entity and a responsibility to the 
American taxpayer that, in fact, this is the wisest use of 
whatever dollars.
    I hope we complete the digital conversion, and I assure you 
we will play our role in that conversion. When there has been a 
problem like the loss of towers, we stepped up in supplementals 
and we built the towers. Congress has not been absent in the 
process, but we have been excluded. I think when we asked for 
inclusion, the words that were used were, in fact, 
inappropriate, and I am glad you have been given this 
opportunity to define your usage of them.
    Let me say to Ms. Mitchell that I want to thank you 
personally, as well as Mr. Lawson, as two individuals who took 
the time to come meet with me personally, to answer questions 
that I had, and to educate me on the challenges that both of 
you are faced with that we on this committee might not have 
been aware of, and certainly it was educational for me.
    I want to, in ending, allow Ms. Lafferty to expand on Ms. 
Eshoo's question, and that was as it relates to the apology. 
There seemed that there was more that you wanted to add to 
that, and I would allow you the rest of my time to do that.
    Ms. Lafferty. Thank you. I appreciate that, Congressman.
    She rambled on a lot of different points, and I would like 
to address them.
    We felt that it was important to alert the public to the 
phone call that we got. The call was based on a supposition 
that National Public Radio had that a Christian organization 
that disagreed with a United States Senator would try to murder 
him by sending anthrax. That is the supposition.
    So, based on that, we felt it was important to let the 
public know where NPR was coming from, and so we issued the 
press release. What is so amazing, and I think Ms. Eshoo's 
logic is a little bit skewed here, because, clearly, they ran a 
defamatory story later, a couple of weeks later. So our outrage 
was legitimate when they did end up writing the story.
    The other thing is that we did receive correspondence from 
NPR. We were at a conference for a number of days and weren't 
available. We contacted our legal counsel, who has been in 
touch with them. I believe they have even contacted, hired an 
outside law firm to deal with this issue because they know they 
have a problem.
    In the correspondence they have said they want to resolve 
this matter from both standpoints. There is only one 
standpoint. The NPR is treating us and me like the rape victim, 
the victim who was in the wrong place at the wrong time, and it 
was her fault. No, it was not Traditional Values Coalition's 
fault. NPR ran a defamatory story against Traditional Values 
Coalition, against Christians, against conservatives, and they 
have to answer for that.
    Eight million people heard this story on the radio. Then 
their ombudsman continues to attack us on the Internet. They 
need to make some serious policy changes at National Public 
Radio, and they have yet to do that.
    Again, I appreciate you allowing me to respond.
    Mr. Upton. The gentleman's time has expired. The gentleman 
from New York, Mr. Engel.
    Mr. Engel. Thank you, Mr. Chairman.
    I want to, first of all, tell Mr. Lawson that I want to 
commend him for the fine work he does. In my opening statement 
I mentioned the demonstration in Cannon. Ms. Eshoo asked the 
question. I was sorry that a number of our colleagues did not 
go to that demonstration because it really opened my eyes in 
terms of how public television is looking for ways to use its 
spectrum more efficiently.
    As you mentioned, Mr. Lawson, in your testimony, you don't 
need additional spectrum to do this. You can do this with the 
spectrum you have. That is something I think is very, very 
significant, broadcasting emergency information, and you and 
the Kentucky station are really to be commended.
    You spoke, in answering Ms. Eshoo's question, about 
expanding some of the other technical capabilities of the 
system. One of the things I thought of, I would like you to 
comment on, is, could the computers in congressional offices, 
for instance, be set up to receive specific information?
    Mr. Lawson. Absolutely, and the configuration would be 
either indoor or outdoor antennas connected to a tuner card 
directly to the PC or to a LAN. You could basically get DTV 
signals into the House LAN through a single antenna, but you 
would probably want some redundancy. It would not interfere 
with receiving information, Internet content, or whatever, from 
other sources on the same PC.
    Mr. Engel. Well, I think it is really exciting. Again, I 
want to really commend you. I think this is certainly the wave 
of the future and something that Congress ought to work with 
you in coming to fruition.
    I also wanted to comment on some of the things that my 
colleague from North Carolina said. I happen to think, frankly, 
and I think anybody who is looking at this objectively would 
think, the fact that PBS calculates formulas to determine the 
cost of PBS programming that public television stations are 
charged, and that you charge stations for different packages of 
national shows to be broadcast in local areas across the 
country, I think it is logical that you would be concerned that 
somehow Congress might be wanting to use that as a club for the 
grants that are given to you or the monies from Congress that 
are given to you.
    I think that if I were in your shoes, I would resist 
meddling by Congress to try to effect the content of 
broadcasting that you are putting forward. I understand that in 
the North Carolina situation that the North Carolina station, 
the PBS station, is very satisfied that they were being treated 
fairly and are being treated fairly, and any discrepancy or 
differences that may have once been there have now been taken 
to their satisfaction. So I just wanted to state that for the 
record, and I wanted to ask you if you wanted to comment on 
that any further.
    Mr. Lawson. Yes. Mr. Engel, we had 13 General Managers on 
the committee that was reviewing the CPB side of those 
formulas, seven station representatives from the ad hoc 
committee of the PBS Board. Those formulas, like any formula 
that Congress has oversight of, never please everyone, whether 
it is crop subsidies or net tax benefits to a state.
    But we did reach a consensus within our industry. It did 
improve the situation for a number of State networks, including 
North Carolina, and we are very happy about that.
    Our concern was that there could be an attempt to link the 
Federal funding, the Federal grants, to the other side of the 
equation that some people make. That is the PBS dues assessment 
of their stations. That concerned us because PBS is a 501(c)(3) 
organization owned by its member stations.
    The decision over how those stations choose to assess 
themselves for PBS programming should be a private matter. We 
have no dispute with the jurisdiction over CPB, and we welcome 
any inquiry, as has been said today repeatedly, into any of our 
programming or practices. But we were concerned that an 
explicit linkage between Federal money and PBS programming 
budgets could create some problems.
    Mr. Engel. Well, I think those concerns are well-founded, 
and I just wanted to give you a chance to explain that. I think 
that that is something that anyone in your shoes would have 
been concerned with.
    Mr. Coonrod, I also want to commend the good work that you 
do. In your written testimony, and some of this was asked 
before, I think, by Mr. Markey to Mr. Lawson, but I wanted to 
highlight it again. In your written testimony you mentioned 
that 20 percent of public broadcasting stations, 76 of 356, are 
able to broadcast the digital signal, and the ``total cost to 
creating the fully operational digital public broadcast 
stations is estimated''--I'm quoting from you--``to be more 
than $1.8 billion, and the stations have already raised nearly 
$750 million,'' which leaves the billion gap--I think it was 
Mr. Upton who mentioned it actually--the billion dollar gap 
before.
    The Federal commitment in the last 3 years, you state, is 
just over $123 million, including grants from the Public 
Telecommunications Facilities Program at the Department of 
Commerce and $45 million appropriated by Congress to CPB.
    You mention in your testimony that these grants, under the 
requirement set by Congress and the administration, and the 
guidelines issued by CPB, these grants must be put toward 
digital transmission facilities.
    So I wanted to ask you if you wanted to expand on that, 
because I think it is so important that Congress come forward, 
as I think Mr. Lawson mentioned before, with monies, because a 
lot of these monies that Congress puts forward are generated by 
matching funds that can be created on the State level.
    Mr. Coonrod. Thank you, Congressman. I just would say that 
I have visited some 20 or 25 stations recently, and in most of 
those stations there is concern about the lack of strong 
Federal support for this, for the digital conversion.
    To the extent that there could be an expression of strong 
congressional support, I think it would release additional 
funding that is available, not just at State governments, but 
also local philanthropies and corporations.
    The other thing I would note is that the money that we have 
been appropriated to date is going to make sure that the 
stations can meet the FCC requirement to be on the air by May 
of 2003. There's a concomitant issue here that I think is very 
important to keep in mind, and particularly when we were 
talking about the desire to get negotiated agreements with the 
cable industry.
    There's a pressing, an urgent need for us to develop the 
kind of digital content that the stations can use and can 
demonstrate the value, not just in their communities, but to 
the local MSOs, so that there could be better cable carriage of 
the digital signals.
    PBS has a number of ideas; others in public broadcasting 
have a number of ideas. Part of our 2003 request is for money 
to help develop the new digital content, so that we could 
demonstrate the full potential of DTVs.
    The 2003 request, by the way, is for $137 million. It is a 
large number, but it is the delta, the gap from the previous 
request that we have not yet received.
    Mr. Engel. Well, thank you. I would be happy to work with 
you on that.
    Mr. Willner, in your testimony, first of all, I think you 
pointed out something that is very, very important, in that 
consumers are really not yet aware of the fact that they are 
buying, even to this day, obsolete TVs. I think when they find 
out, they are going to be outraged, and I think you pointed 
that out.
    Insight Communications, as you pointed out, has really been 
very innovative in terms of doing an agreement with PBS and 
APTS. You say in your written testimony, carry digital 
broadcast of local public broadcast stations in all your 
franchise areas, and you talk about the vital role played by 
public broadcasters.
    I want to commend you for what you are doing, and I would 
like to encourage some of your colleagues to do the same. I 
think that you have shown that you can do it, and do it quite 
successfully. It is really a blueprint of, I think, what other 
cable operators should be doing and looking toward doing.
    So I want to commend you for that, and I wonder if you can 
tell us a little bit more about it.
    Mr. Willner. Well, I appreciate that, Congressman. Insight 
operates, the largest market we operate in is Louisville, 
Kentucky. They have two PBS stations. It becomes much more 
complicated in the largest markets in the United States, where 
they have three, four, five, sometimes even more, PBS stations, 
and that they only way a universal agreement can be agreed to 
is if all of them receive carriage, even if there is 
duplicative programming on each of those stations. That is a 
very inefficient use of very, very expensive bandwidth.
    I think that has been one of the hangups in terms of a more 
universal result here. On the other hand, Comcast has made the 
choice that at least for now they are doing it on a market-by-
market basis. I think that they are plowing forward very 
aggressively in making arrangements with individual PBS 
stations.
    Mr. Engel. Thank you. I have one final question to Ms. 
Walker, but before I just want to reiterate again with Mr. 
Klose that I appreciated him coming into my office to chat very 
frankly with me. I really do appreciate it, and I really have 
seen an attempt in my listening to really address some of the 
problems that we discussed. So I thank you.
    Ms. Walker, as you mentioned, as I mentioned in my opening 
statement, WNYC and WNET were affected on September 11 more 
than any other public broadcasters, and you remained on the air 
and did your job. I think it is something we should keep 
saying.
    I would like you just to answer a question about one of the 
issues that obviously faces New York City as a result of the 
destruction of the World Trade Center Towers, and that is 
transmission capabilities. What efforts are underway to find a 
new location for broadcasters since the World Trade Center went 
down?
    Ms. Walker. I think radio and TV are a little different, 
although we share the same issue. One of the things we found--
and thank you for your question--one of the things we found on 
the 11th was that it was not really probably a good idea to 
have our primary transmitter and our backup transmitter on the 
same location. So that is part of what we are addressing, 
particularly when the location that was the one that would be 
the most natural would be the Empire State Building, yet 
another symbol.
    So we have made the decision to have our primary and our 
backup on two different locations, with the primary on Four 
Times Square, and we are still in negotiations with the Empire 
State Building. There are some real limitations, I think, to 
what the Empire State Building can carry.
    The television stations, in particular, as you know, I 
think are looking at alternate kind of transmission facilities. 
That effort is being led by my colleague, Bill Baker, at WNET, 
and some of the other commercial TV stations, to find on 
Governor's Island or some other location a place for the 
television transmitters.
    Mr. Engel. Well, thank you, and it is good to see you here.
    Ms. Walker. Thank you.
    Mr. Engel. Thank you, Mr. Chairman.
    Mr. Upton. Mr. Pickering.
    Mr. Pickering. Mr. Chairman, thank you. I would like to 
express my appreciation for this hearing, talk to you about my 
ongoing interest in making sure that rural states are equal 
partners in the production and the funding and the digital 
conversion.
    What I would like to do, though, with my time is talk a 
little bit, I hope in a very positive and constructive way, as 
to how we can begin bridging the gaps or resolving conflicts 
that are embodied or manifested across the country and in the 
debate that we have here today with NPR.
    Ms. Lafferty was right to be offended with the reporting. 
She was right to be outraged.
    Mr. Klose, I appreciate you apologizing.
    There are some underlying issues, though, and what I would 
like to try to do with my time is ask some questions and then, 
if I can, put it in context that I hope will appeal to 
everyone's better angels.
    NPR and CPB have some done some wonderful programming that 
would capture the broad mosaic of our country and our people. 
They have done wonderful historical, whether it is the Civil 
War or baseball or ``Commanding Heights,'' to give greater 
understanding to people in our Nation and capturing the heart 
and the essence of various communities across our country. I 
think that is all a positive contribution, their educational 
program.
    But the area where we seem to have the contention and the 
conflict with public broadcasting is the area of cultural 
conflict or cultural struggle, or the conflict of values, and 
how can we promote the common good or the common understanding 
without demonizing one side or the other, or without being 
biased toward deeply held values or views one side or the 
other.
    Let me ask a quick question and then I will come back. Mr. 
Klose, Mr. Coonrod, can you all think of any examples where you 
all have looked at the conservative evangelical Christian 
community and had a positive story or portrayal of the works 
that they are doing in communities across the country? Mr. 
Klose?
    Mr. Klose. Congressman, I don't have it at hand, and I 
would like to be able to respond to you. So I would like come 
back to you on that question, please.
    Mr. Pickering. Mr. Coonrod?
    Mr. Coonrod. I could answer more generally, Congressman. A 
very well-respected program that CPB funds on public television 
is ``Religion and Ethics Weekly,'' which is a program that 
deals with questions of values and religion in a very 
constructive way. It is a program that has the strong support 
of religious institutions across the board.
    I don't know whether that program has dealt specifically 
with the topic. I guess Pat is saying, yes, it has dealt 
specifically with that topic.
    But it is the kind of program that public television 
supports and that CPB specifically provides funding for on an 
annual basis, along with a Lilly Endowment.
    I would also mention that a program that has been popular 
in Minnesota, a radio program called, ``First Person Speaking 
of Faith,'' has now been cleared for national distribution, so 
there will be a regular weekly national program about people 
speaking, their own testimony, about their religious 
convictions. That show will be distributed nationally beginning 
I think this week or next week.
    This is an important topic, and we do need to find ways to 
both demonstrate our conviction and our belief that we must 
reflect the range of views in this country and the range of 
beliefs in this country, and we also must find ways to make 
sure that the people, the broad public understands that.
    I think Pat wants to comment on that.
    Ms. Mitchell. I appreciate this opportunity to point out 
the fact that it is very much of importance to us that our 
programming reflect, as you said, this wide mosaic of American 
interest and values.
    The program that Mr. Coonrod referenced, ``Religious and 
Ethics Weekly,'' is one that we point to with pride. I just 
reviewed last night the topics that they have included already 
this season, and it was coverage of the Southern Baptist 
Convention, the administration's faith-based initiative, the 
Christian Coalition of America's Annual Convention, and several 
interviews with religious thinker and leaders from all points 
of view.
    If you look at the documentaries that will be coming to the 
PBS schedule in the next season, you will see not only the wide 
historical perspective that we always try and bring to promote 
greater understanding of all faiths, but contemporary looks at 
American religious groups as well.
    Mr. Pickering. Mr. Chairman, if I could have just a little 
bit more time, not having seen those programs--and I would like 
to before I make any judgment on them--I do think that there is 
from those in my home State, and probably what you have heard 
from this side of the panel today, a sense, a perception, 
specific examples, and I think of what happened with TVC as an 
example of where there is a perception of bias or disrespect or 
insensitivity, and at times an offensive nature and approach to 
those who hold strongly held religious views or traditionally 
conservative views.
    This usually comes into play in how we define and how we 
look at family and sexuality. That seems to be kind of the 
point of debate and divide in our country.
    Let me just real quickly say why I think this is so 
important. If you look at Western Civilization and history, 
there was an early Christian teaching that really, I think, led 
us to where we are today, the teaching of Christ that said that 
all our equal, Jew and Gentile, male and female, free and 
slave.
    And that radical concept I think eventually led to the 
ideals of democracy, and then it, through our country, has 
worked its way through history, where those who held that 
belief worked to abolish slavery, worked for the right of women 
to vote, worked for civil rights. Whether it was in an African 
American church or in the religious movements throughout 
history, it has played a very constructive role of tolerance, 
of democracy, of believing that all are created equal.
    This past weekend I was home, for example, and I went to a 
gathering, an annual gathering, of Pentecostals in Mississippi. 
The church service was integrated. The pastor talked about 
Martin Luther King and his ideals.
    If I go to Meridian, Mississippi, it is the conservative 
churches who are caring for abused and neglected children. They 
are doing the mentoring program.
    In Forrest, Mississippi, where we have a large and growing 
and new Hispanic community, it is the conservative and 
evangelical churches who are going and meeting the needs, the 
physical needs, as well as the spiritual needs, of people 
coming to a new place.
    So my fear is, because we get caught up in this debate on 
other issues, and where those who disagree want to demonize the 
other side or paint them as intolerant or extreme or lacking in 
compassion, we actually do the public a disservice and we lose 
the common ground, common purpose, common understanding, ``the 
one Nation'' that we talk about.
    Today I think that our divide is most significant not on 
race or not on income or education, but it is on this issue of 
those who have strong religious beliefs and those who have 
differing views. I think where you all can try to bridge that 
misunderstanding and treat people of deep religious convictions 
with respect, and to show not only what this reporter did in 
this case of trying to make one group appear to be extreme, but 
show how those conservative Christians in many communities 
across this country, or in all communities across the country, 
are actually doing good works and good deeds.
    I think when you do that, you foster a better 
understanding, but at the same time you don't have the 
controversy and the conflict that you are seeing on this panel 
about perceived bias or lack of sensitivity or lack of respect. 
So I would encourage you all to do this.
    You know, Ms. Lafferty, there is a debate on public funding 
for CPB. Whether we agree or disagree philosophically whether 
there should be, public broadcasting is going to continue. The 
votes are not there to take it away.
    But I do hope that you hear this message and that we can 
appeal to your better angels in a constructive way to do 
everything possible not to ever let a story like this ever 
happen again, because it does reflect a bias. So have your 
editors and have your board and do everything you can and tell 
stories about conservative Christians that don't make them 
appear to be intolerant or hateful or extremists, because that 
is not my experience. That is not the experience across this 
country.
    Mr. Klose. If I may respond, Mr. Pickering, as you know, we 
have said clearly that it was a mistake and I have apologized 
for it, personally and professionally, to Ms. Lafferty.
    I do want to point out that National Public Radio has had, 
as one of the first broadcast organizations to actually have a 
religion reporter dedicated solely to reporting on religious 
trends and issues in the United States. Over the years of that 
correspondence activities, we have done scores of reports 
across the whole spectrum of religious issues, religious 
dialog, and religious outreach in the country.
    I would be very pleased to provide to you a more specific 
list of the topics that have been covered, and I can take any 
particular time period you would think would be representative, 
perhaps over the past 6 or 8 months, or perhaps the past year. 
I would be very pleased to do that.
    Mr. Pickering. Thank you. I would appreciate that.
    Mr. Upton. I might just say, if you want to provide that to 
the committee, we will include it as part of the public record 
as well.
    Mr. Klose. Thank you, Mr. Chairman.
    Mr. Pickering. Mr. Chairman, if I could, ask that a memo 
from Mr. Burr be read into the record and the transcript of the 
NPR, that statement, and other relevant materials.
    Mr. Upton. Without objection.
    Mr. Pickering. Thank you very much.
    [The material follows:]
                             Media Matters
              Pressure Campaigns: Getting NPR's Attention
        by jeffrey a. dvorkin, ombudsman, national public radio
    Do pressure or write-in campaigns work? Do news organizations in 
general, and NPR in particular, respond to pressure from advocacy 
groups? Should NPR respond? And if NPR responds, does that indicate 
that it has ``caved,'' or does it make NPR more open to and respectful 
of public opinion?
    Recently I wrote about pressure from partisans in the Middle East 
conflict. Their goal is to make NPR cover the story from their 
perspective. NPR's reporting on this issue--like the conflict itself--
may never be seen to be fair by everyone.
    But another recent pressure campaign illustrates yet another 
journalistic dilemma--wanting to do the right thing, but not being able 
to do it.
                  anthrax and christian conservatives
    This campaign involved the anthrax investigation. Reporter David 
Kestenbaum asked the Traditional Values Coalition, a conservative 
Christian lobby group, if it was under investigation by the FBI. The 
TVC has been active in their opposition to Senators Leahy and Daschle 
over their efforts to remove the phrase ``So Help Me God'' from the 
oath used by the senators in their official duties. Senators Leahy and 
Daschle also received anthrax letters. Kestenbaum wondered if, in this 
case, two plus two made four. The Coalition denied that it had been 
questioned by the FBI and was outraged that Kestenbaum even asked the 
question in the pre-broadcast process of gathering information.
    Kestenbaum included that denial in his report on Jan. 22:
        Two of the anthrax letters were sent to Senators Tom Daschle 
        and Patrick Leahy, both Democrats. One group who had a gripe 
        with Daschle and Leahy is the Traditional Values Coalition, 
        which before the attacks had issued a press release criticizing 
        the senators for trying to remove the phrase ``so help me God'' 
        from the oath. The Traditional Values Coalition, however, told 
        me the FBI had not contacted them and then issued a press 
        release saying NPR was in the pocket of the Democrats and 
        trying to frame them. But investigators are thinking along 
        these lines . . .
    The Coalition responded by denouncing NPR and launched a vigorous 
campaign, which at last tally was around 200 e-mails received here. 
More details can be found at the Traditional Values Coalition Web site.
    NPR responded by airing the following statement, read by Bob 
Edwards on Morning Edition on Wednesday, January 30:
        And a story last week about the ongoing anthrax investigation 
        mentioned the Traditional Values Coalition. Reporter David 
        Kestenbaum contacted that group to ask if it had been contacted 
        by the FBI. The TVC said it had not, since there is no evidence 
        that it was or should be investigated. The TVC said it was 
        inappropriate for it to be named on the air. The NPR editors 
        agree.
    Andrea Lafferty is the spokesperson for TVC. In an interview with 
UPI she was not mollified:
        That's not an apology and our lawyer says it's not a 
        retraction. Since the correction aired, we have heard from NPR 
        . . . they seem to be very scared and they should be. We are 
        still proceeding with legal action because, they are not sorry 
        and we will not allow them to do this to someone else.
    NPR management says it has attempted to contact the Traditional 
Values Coalition to work out a mutually satisfactory statement for 
broadcast, but so far, the TVC has not responded.
    This tactic of non-response might allow the TVC to further its own 
goals by using NPR as a convenient scapegoat.
    Many letters written to the ombudsman would indicate that tactic is 
working:
        Your reporter, David Kestenbaum has issued a story that has no 
        facts--just innuendos--trying to link Traditional Values 
        Coalition with the anthrax letters sent to Senators Tom Daschle 
        and Patrick Leahy. The story was without foundation and should 
        never have been run in the first place. I understand that your 
        organization, however, has refused to issue a retraction or 
        apology.
                                               Denny Eyberg
    And from Barry Mann:
        Where is the apology? You really should apologize for your 
        irresponsible reporting. I'm tired of defending NPR from the 
        barbs of conservative friends.
    In my opinion, the statement was a correction but in the form of a 
clarification. But while Kestenbaum was right to ask a strong 
reportorial question in the process of gathering information, the 
denial should have been enough. There was no journalistic reason for 
including it in the report.
    NPR is known for its vigorous editing to keep the story strong and 
on point. In this case, the editing process seems to have failed to do 
its job.
    The statement read by Edwards was less than it should have been. 
NPR still needs to be more nimble and more open about admitting its 
errors. In the case of the allegations, there should be a time and 
place where the concerns of the listeners can be addressed. The NPR Web 
site would be a good starting point.

    Mr. Upton. Mr. Green?
    Mr. Green. Thank you, Mr. Chairman. I am glad to follow my 
colleague from Mississippi because I think part of our free 
speech experience is, if you are in the pit--you can't imagine 
how many times everybody up here, and those of us who have had 
to leave for other meetings, have been asked tough questions 
and what I consider asinine questions by media that I don't 
like to answer because some of them are just you almost have to 
educate them. But that is part of free speech. If the 
Traditional Values Coalition wants to be part of this free 
speech and this system here of democracy, then you are going to 
get those.
    Mr. Chairman, I hope maybe if we will have a hearing on 
every time somebody asks a terrible question of someone that we 
may not appreciate, if we have a hearing, then we would spend 
all our time in our Telecommmunications Subcommittee just doing 
that.
    My concern is that--and I appreciate my colleague from 
Mississippi talking about the lack of sensitivity and respect. 
I feel like as a Christian Democrat I don't get the respect 
that I should have or the sensitivity from the Traditional 
Values Coalition.
    I have had many people who get mailers from you and your 
group say, ``Well, I'm surprised you're a Christian because you 
don't vote with us.'' And I say, ``Well, let me tell you my 
background.''
    So I think there is a lack of sensitivity maybe on both 
sides. But, again, I haven't written you or complained or 
needlessly asked for a congressional hearing on that. Because I 
would be glad to take some of our Democratic colleagues who 
probably have a zero record with you and talk about our 
Christian beliefs and our backgrounds, that we may not share 
some of your values that you think that vote us as Christians.
    But, be that as it may, I really want to talk about 
broadcasting and NPR issues. Mr. Willner, in your earlier 
testimony, some of your testimony, you outline in your 
testimony, you talked about what the cable industry has decided 
to offer HDTV. In fact, someone, I think one of my Republican 
colleague said they are having to pay extra for their digital 
for their PBS station. I would assume that might be because 
they are paying extra for their digital TV.
    Why is there an additional cost for cable subscribers to 
have HDTV, and why wouldn't it be offered as free digital tier, 
as an incentive to spur that transition?
    Mr. Willner. Congressman, the cable industry, as I said 
earlier, spent over $60 billion in upgrading its plant to be 
able to deliver both analog and digital signals, provide high-
speed access to the Internet, as well as the alternative to the 
local telephone company with a facilities-based alternative.
    As I said, by spending private capital, not coming before 
you for that $60 billion that we have already spent and another 
$10 billion that is being spent, we have to show our investors, 
our equity investors, our debt investors, a return on that 
investment.
    For every high-definition television set that we hook up to 
a cable system, we are going to install a box that we are 
estimating right now is going to cost around $400, which, by 
the way, is about $400 less expensive than the digital tuner 
the consumer would have to buy on his own, if he bought his own 
HDTV and had----
    Mr. Green. Well, my wife just wrote our check to pay for my 
local digital top boxes on the number of TVs at home that we 
have so that we would have digital. So the ratepayers under 
cable are paying for that.
    Mr. Willner. The consumer is paying for the box, that's 
right. We are buying it and they are paying a monthly fee for 
it.
    Mr. Green. Okay. Again, I understand that somebody has to 
pay for it. Your investors had to invest the capital. But, 
ultimately, you will get a return on it, I assume like the 
broadcasters will, although I didn't have to pay for digital 
for over-the-air television. Granted, I would have to buy a 
receiver for it.
    But I appreciate that because I know that is something that 
has been discussed a great many times. I know the folks here 
from public broadcasting are having, particularly from rural 
areas who don't have the resources that they do in an urban 
area like I have in Houston, but most of our other stations, 
you know, our network stations, they had to go to the same type 
of investors, the same capital markets, that my cable folks had 
to go to.
    So that is one of the things that I hear complaints all the 
time. If we are going to go to digital in Houston, we have to 
buy these boxes, and I think it is worth it. It expanded our 
number of channels amazingly, but, again, I think that is 
something that maybe folks need to realize, that there is a 
monthly cost for that. If you have more than one TV that is 
cable hookup, like most of us, I guess, up here would have, 
then it can be a substantial amount every month.
    But I appreciate that, and I understand you had to. But, 
again, NPR doesn't have the ability to go to the capital 
markets like the private sector, like cable, like my local 
cable or even my broadcasters do, my for-profit broadcasters.
    Mr. Willner. Well, the broadcasters, I can assure you, are 
developing business plans where they will make money off of 
that digital frequency.
    Mr. Green. Oh, and ultimately we will all pay for it 
because whatever cost I pay for whatever product I buy, I am 
sure there is no free lunch.
    Mr. Willner. Right.
    Mr. Green. So we are going to pay for that.
    Mr. Klose, as you move forward with your new digital 
programming, is there anything you are learning from the recent 
rollout at XM Radio or Sirus? These two companies really offer 
a widely available digital radio format, and I was wondering if 
you anticipate consumer demand based on the current level of 
that response.
    Mr. Klose. Yes, sir. Congressman, we actually have two 
channels on Sirus Satellite Radio, the other competing company 
with XM. We have been listening with great interest and 
intensity both to XM and to Sirus.
    We believe that there will be additional kinds of 
audiences, additional segments of the country, people in the 
country who may not be listening to public radio right now who 
are going to naturally migrate to those systems; also, that 
there are people who do listen to public radio now who are 
going to be looking to supplement it with other services. We 
look forward to the digital transition giving us the capacity 
to bring more content and more contact both at the community 
level, at the regional level, and at the national level.
    Mr. Green. Thank you. Thank you, Mr. Chairman.
    Ms. Lafferty. May I respond to his comments?
    Mr. Upton. Yes.
    Ms. Lafferty. Thank you.
    Congressman Green, I just wanted to assure you that I have 
been in what you called ``the pit'' for a long time. So I 
understand that it is a tough business. I do a lot of media. I 
get a lot of tough questions.
    But what we are talking about--you may not understand 
this--we are talking about----
    Mr. Green. Oh, I understand what you are talking about.
    Ms. Lafferty. [continuing] slander. I think even now maybe 
Mr. Klose understands this was a serious problem. It is not 
that I am not tough enough and can't handle it. It was an 
attack against a lot of people, a lot of Bible-believing 
Christians.
    Mr. Green. Well, I disagree with you because I am a Bible-
believing Christian, have grown up in the church, so has my 
family----
    Ms. Lafferty. So it is okay to call a Christian 
organization and just assume that they would try and murder 
Senators?
    Mr. Green. I think they ought to have the ability to call 
anyone who wants to be part of the political system, and you 
want to be part of it.
    Ms. Lafferty. I am a part of it, yes.
    Mr. Green. Okay.
    Ms. Lafferty. As are our 43,000 churches.
    Mr. Green. We are all a part of it, but you ought to be 
able to have those same tough questions. You can't imagine some 
of the questions as Members of Congress we get on everything we 
do and what our families do.
    Ms. Lafferty. And those reporters should be held 
accountable if they are slanderous kinds of questions and when 
they run a show about it.
    Mr. Green. Oh, you just can't imagine how many people in 
public office on whatever level have those kinds of questions, 
but that is one of the prices we pay for having a free media 
and a free society to be able to question their leaders or 
their opinion-makers or opinion leaders. That is true whether 
you are elected or whether you are----
    Ms. Lafferty. I understand that I am considered a public 
figure, but that doesn't give National Public Radio the right--
and, frankly, they know that they shouldn't have done it, and 
how they are going to resolve it is another issue.
    Mr. Green. Okay, I disagree with the question, but, again, 
I don't want the taint of media not being able to ask even 
those dumb questions that one shouldn't be asked, because I am 
worried they may not ask one that should be asked.
    Ms. Lafferty. Well, you have been in the business long 
enough, and so have I; we know they ask all the questions.
    Mr. Green. Oh, well, I do, and I try to give them the 
answers I want, instead of what they want.
    Thank you, Mr. Chairman.
    Mr. Upton. Mr. Blunt?
    Mr. Blunt. Thank you, Mr. Chairman. Thank you for having 
this hearing today.
    I get to follow two of my very good friends on this 
committee, Mr. Green and Mr. Pickering. I would suggest, not to 
extend and prolong the debate on this topic, but I think the 
debate is different with these organizations represented at the 
table today than it would be the rest of the media, because all 
taxpayers subsidize this particular news programming, this 
particular programming generally.
    Because of that, the questions that would not be nearly as 
appropriate if this was totally something in the private market 
are, in fact, appropriate for members of this panel. If my 
dollars go to pay that reporter, just like the person who owns 
the newspaper or owns the national news network has some impact 
on how that reporter does their job, I have more of a right to 
have input about what is on NPR or PBC as a taxpayer than I do 
otherwise.
    The 623,000 people I represent all helped make these 
particular organizations and their approach possible. So I do 
think there is a different level of appropriateness for us to 
discuss this topic.
    I think Mr. Pickering did such a good job of expressing 
just the way that people of faith view the importance of faith 
in our society, and I think you did a fairly good job of 
responding as a panel to your efforts on PBS and NPR to begin 
to approach that.
    I listened to both. I don't know that I have heard the 
particular programs you mentioned, and I will look at some 
interest--I would be interested now if there is a consistent 
viewpoint, and if that viewpoint in that programming is broad-
based from a religious sense or it is based from one particular 
religious point of view. I really do intend to look at that, 
and I am glad you are doing it, and I hope you are also looking 
at it from that way, not just that we do a religious program or 
that we have somebody that looks at religion. But does the 
person that looks at religion really look at it from a way that 
creates a broad sense of faith in our society, how important it 
is to how many people, all of whom are part of the effort to 
pay to make this service available?
    I am fortunate; in my community I serve on the advisory 
panel for the public radio station. I think it is well-run, and 
I make comments, and they asked me to do that. The ethics folks 
here said I could do that, and I have been glad to do that. I 
was involved a little bit even before I came here in that 
regard and with public television both.
    So I do think there is a service that needs to be provided, 
particularly in the parts of the country not served, in the 
case of public television, by cable. There is a diversity 
possibility there that is much more important, in my view, in 
rural America, unserved by cable, maybe even unserved by 
satellite, certainly unserved everywhere without extra expense 
than elsewhere.
    I want to ask a couple of questions. I just want to follow 
up. I came in the middle of Mr. Pickering's comments. I believe 
he was characterizing, Mr. Klose, your comments to Ms. Lafferty 
today as an apology. Would that be the way you would 
characterize your comments?
    Mr. Klose. Yes, sir, those are the words I used. I said, 
``I apologize, both personally and professionally, for this 
mistake that was made in this segment, in this part of a report 
from our correspondent.''
    Mr. Blunt. Well, I read the transcript, and I agree with 
you; I think it was mistakenly stated and unfortunate in its 
nature.
    Have you done that before today? Was this the day that you 
made that apology?
    Mr. Klose. This is my personal apology today, yes, sir.
    Mr. Blunt. Has there been a less personal apology prior to 
today?
    Mr. Klose. On our website and on the air we, as I think is 
perhaps in the record, several days after this mistake 
occurred, there was a statement on NPR, which I could read, if 
you would care to, or----
    Mr. Blunt. I would like you to read it. Do you have it with 
you?
    Mr. Klose. Yes, sir, I do. I think, actually, Ms. Lafferty 
has actually read it herself earlier. Let me just find it here.
    This was from ``Morning Edition,'' the morning news 
program, corrected on the ``Morning Edition,'' about a week 
after the original mistake was made.
    ``A story last week about the ongoing anthrax investigation 
mentioned the Traditional Values Coalition reported David 
Kestenbaum contacted that group to ask if it had been contacted 
by the FBI. The TVC said it had not, since there was no 
evidence that it was or should be investigated. The TVC said it 
was inappropriate for it to be named on the air. The NPR 
editors agree.''
    Mr. Blunt. The NPR editors agreed that it had been 
inappropriate to name them on the air?
    Mr. Klose. Yes, inappropriate, that it was inappropriate.
    Mr. Blunt. And you issued what you consider a personal 
apology today?
    Mr. Klose. I have today, sir, and this is on our website 
and has been on the website since the correction was made on 
the January 30.
    Mr. Blunt. Ms. Lafferty, do you want to comment on the 
apology that was on the--the retraction on the website versus 
the comments you heard today, several months later?
    Ms. Lafferty. Right. Well, it is not an apology and it is 
not a retraction. He just says, ``We agree.''
    You know, there are serious problems at National Public 
Radio which have been made clear today. There's issues of 
them--a lot of other issues, not just dealing with Traditional 
Values Coalition, that they need to deal with.
    But there has not been a real apology or a retraction. We 
believe that 8 million people or more heard this, and so there 
needs to be further discussion about how to resolve this 
problem.
    Mr. Blunt. And I assume there are other ways besides here 
for you to pursue that discussion?
    Ms. Lafferty. Mr. Klose has hired an outside lawyer. We 
have been talking to their people. Mr. Kestenbaum is still 
there, but he is working and still reporting on anthrax, but he 
really is not the issue. The issue is that he is a symptom of 
the problem at National Public Radio.
    Mr. Blunt. Okay, Ms. Mitchell, I want to thank you again 
for coming by, as you did a few weeks ago to visit with me. In 
my office we talked about balance and a sense of bias and your 
thoughts about that as well. We had a great discussion.
    I am wondering, as you talk about the documentary plans for 
next year and what you have had on this year, do you make an 
effort in that to really create a balance there, and is it a 
balance both in terms of viewership and availability as well as 
content? I am just asking you to comment on that. I am asking a 
question here I have no idea what the answer is to in terms of 
how you are balancing it as it relates to who actually sees the 
program and when it is available, and that sort of thing.
    Ms. Mitchell. Thank you, Mr. Blunt, for the opportunity to 
talk a bit about the way in which our programs are selected. In 
this congressional season, PBS has distributed to its member 
stations 8,800 hours of programming, and that has resulted from 
some 3,000 proposals that we receive. We evaluate each of those 
proposals. Only about 300 or 400 get selected, by the way.
    But we evaluate them on the guidelines that were 
established by charter of this committee in the early 1970's. 
That charter is certainly editorial integrity, balance, 
certainly top production quality.
    So we make sure that any program to be distributed to our 
member stations meets those qualifications. In looking over the 
scope and the depth of our work, which, as you know, is quite a 
lot of genres, including everything from nature to history to 
social studies, we always are attempting to provide the scope 
and the depth of not only American interest, what our 
constituents are interested in seeing, but also what we feel 
serves them best.
    Each year we do a viewer survey of that programming, and we 
ask our viewers, ``Have you been served well by this 
programming?'' Each year, gratefully, the greatest percentage 
of them, more than 70 percent, have indicated that they do not 
find our programming biased and that they do find it a balanced 
and in-depth look at our country. We take that very seriously.
    We also pay a lot of attention to complaints that come from 
our member stations as well as viewers directly to us. I 
reviewed, in preparation for this hearing, programming over the 
last year, and there were only nine that we would call notable 
complaints.
    By ``notable,'' we mean something in excess of 200, which 
is really not a lot when you consider we reach 100 million 
Americans every month. Those were in some instances letter-
writing campaigns, in some instances--in fact, three--having to 
do with schedule and format.
    We don't measure the impact of our programming by the 
number of people who turn up or by the number of complaints 
that come in. We factor all of this into our overall concern 
that we are serving the largest number of Americans with the 
greatest depth and scope of programming that we can, 
representing the balance of interest in this country, what they 
want to know and what they need to know.
    Mr. Blunt. As you evaluate in that survey of your viewers, 
do you ever try to evaluate who doesn't quality for the survey 
because they don't view and why it is that they don't, never 
have, or used to and quit? Taking advantage of this service, do 
you try to evaluate that in your survey as well?
    Ms. Mitchell. Mr. Blunt, that is something we have been 
discussing a lot, that this next year we are going to change 
our viewer survey process. We are looking at doing it through 
perhaps political pollsters. We are looking to broaden the 
survey, so that we might reach people who aren't watching us. 
This survey does, but it is really aimed at our committed 
viewers.
    Mr. Blunt. I have seen it because you brought it to me, and 
it has got a high satisfaction level, but, of course, among 
viewers you would assume that it would have a higher 
satisfaction level----
    Ms. Mitchell. Right.
    Mr. Blunt. [continuing] than people who have decided not to 
view it.
    Mr. Coonrod, on that same topic, do you have a strategy to 
look at ways to expand your reach and viewership, and perhaps 
the broader definition of what you put on the air?
    Mr. Coonrod. We do, but I would also mention that one of 
the polls that we use regularly is a national poll, the Roper 
Starch Poll. That does not measure the views just of viewers, 
but that is a broader public reaction to public broadcasting. 
In those polls, consistently they rate public radio and public 
television very high. And these are not polls that public 
broadcasting conducts. These are polls that are conducted by 
others. They rate public broadcasting very high.
    They also consistently rate it very high in terms of the 
value they believe that their tax dollar delivers for public 
broadcasting. So that is another indicator.
    But we do a number of things to try to stay in touch with 
this. We solicit public comment. We maintain a 24-hour toll-
free telephone number. We have a dedicated email address for 
comments, any comment that you might have about public 
broadcasting, and we maintain a post office box for those 
people who still write letters.
    We link these; at least all of the electronic means are 
linked so that the comments that we get are made available to 
producers, PBS, and others, so that we can feed back the public 
comment that we do get.
    We monitor public perceptions, as I have said. I think we 
operate best when we are able to look at the broad, the variety 
of voices and perspectives that are on public broadcasting, the 
rich variety of voices and perspectives, and look at supporting 
new programs that will add to the number of voices that are 
there, not detract from it in any way That is part of what we 
try to do and the kind of support that we provide both to 
public radio and to public television.
    Mr. Blunt. Well, it is a challenge to work for everybody, 
and it does put you in a slightly different situation, 
particularly, I would say again, from the news perspective. 
There is a different perspective there when you have such a 
broad base of ownership, the people of America, than if you 
have a narrower structure and you can say, ``Look, we can put 
on whatever we want to. We can do it however we want to.'' It 
appeals to somebody, and doesn't appeal to somebody else.
    You are here today for a purpose that others would not be 
here for, because you do have this unique contact with American 
taxpayers, and I think, because of that, a responsibility that 
goes beyond just how you would traditionally deliver these 
exact same kinds of services in an absolute free market.
    So, Mr. Chairman, thank you for giving me the time.
    Mr. Upton. Thank you, Mr. Blunt.
    This concludes the questions from the panel members. I 
appreciate you all being here.
    Mr. Markey. Can I have 30 seconds, Mr. Chairman?
    Mr. Upton. I will yield 30 seconds to the gentleman from 
Massachusetts.
    Mr. Markey. I wanted to compliment you, Mr. Chairman, on 
this very helpful hearing----
    Mr. Upton. I will let you have 2 minutes now.
    Mr. Markey. I think it has really helped all of the members 
of the committee to actually have the major players all sitting 
here simultaneously. I think everyone leaves today hopeful that 
we can work together with both the radio and television parts 
of the public broadcasting system.
    For my own part, Mr. Chairman, I hope that the personal and 
professional apology from Mr. Klose to Ms. Lafferty can now 
result in a reconciliation that can take place that doesn't 
need lawyers, and that you can work it out as human beings. 
Because I think that that gesture is now something that, if it 
was reciprocated, can help for this not to escalate, but rather 
to be resolved in a way that allows for better long-term 
understanding between all parties.
    I thank you, Mr. Chairman, for the great opportunity that 
you have presented here today for everyone.
    Mr. Upton. I thank you for those kind words, and I do want 
to reiterate and follow Chairman Tauzin as well, that if at 
some point we do want to reauthorize, we understand the many 
complicated issues that are there, some of them Congress' 
doing, and particularly as we move to the digital age.
    I appreciate many of you having private meetings in my 
office as we put this hearing together.
    I want to compliment the staff on both sides, the 
professionalism that was experienced there.
    With that, this hearing is now adjourned. Thank you.
    [Whereupon, at 1:57 p.m., the subcommittee adjourned, 
subject to the call of the Chair.]


                            
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