[Congressional Record Volume 153, Number 110 (Wednesday, July 11, 2007)]
[Extensions of Remarks]
[Page E1488]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           INTRODUCTORY STATEMENT OF TELECOMMUNICATIONS BILL

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                         HON. CHARLES B. RANGEL

                              of new york

                    in the house of representatives

                        Wednesday, July 11, 2007

  Mr. RANGEL. Madam Speaker, today I am introducing legislation to 
provide tax incentives to encourage greater diversity of ownership in 
telecommunications businesses. My bill is a response to the increasing 
ownership of television and radio properties by large media companies.
  I strongly believe that promoting diverse viewpoints on the airwaves 
is an important public policy goal. The only way to accomplish that 
goal is to broaden the ownership of broadcast stations. The television 
and radio spectrum is a limited resource. The trend in recent years has 
been toward a greater concentration of ownership in the hands of large 
media companies. We need to reverse that trend.
  Madam Speaker, small businesses that wish to enter telecommunications 
businesses face significant barriers. To enter a broadcast industry, a 
small business must purchase an existing property. Owners of those 
properties find it much easier to sell to large businesses than to 
small businesses. Therefore, small businesses quite often do not have a 
seat at the table when there are negotiations over the sale of 
broadcast properties.
  My bill would reduce those barriers by providing limited deferral of 
capital gain taxes when a telecommunications property is sold to a 
small business. This would provide the sellers of those properties a 
positive incentive to consider a small business purchaser.
  Large segments of our society historically have been underrepresented 
in the ownership of radio and television properties. I believe that it 
is vital that those groups have access to the television and radio 
spectrum so that their views are represented on our airwaves. As a 
result, my bill increases the capital gain tax deferral when the sale 
is to a small business owned and controlled by individuals from these 
historically underrepresented groups.

  Madam Speaker, I understand that some may attack my bill as being the 
re-enactment of a flawed prior program. The provisions in my bill are 
quite similar to the tax certificate program that was repealed by the 
Congress in 1995. I do not quarrel with those who assert that there 
were abuses in that program. However, it is unfortunate that the 
Congress chose repeal and not reform because that program had been 
effective in accomplishing its goal of expanding ownership of radio and 
television businesses. In 1978, before the implementation of that 
program, only .05 percent of all broadcast stations in this country 
were owned by minority groups. By 1994, the year before the program was 
repealed, the program had succeeded in increasing minority ownership 
60-fold to 3 percent. Since that program was repealed, the number of 
minority-owned broadcast properties has declined.
  The bill that I am introducing today is designed to prevent any 
potential abuses. It is limited to small business purchasers, it 
contains restrictions on the number of purchases that can be made by 
anyone business, it contains recapture provisions to prevent the use of 
the small business as a front for another party, and it contains 
provisions designed to prevent avoidance of the ownership requirements 
through options or other sophisticated transactions.
  All small businesses, regardless of their ownership, would be 
eligible for the benefits of my bill. I believe this incentive is 
appropriate so that the views of many different groups are heard on our 
Nation's airwaves. The bill simply attempts to ensure that small 
businesses, including minority-owned small businesses, have a seat at 
the table when a broadcast property is being sold.
  Madam Speaker, I am hopeful that we will be able to deal with this 
issue on a bipartisan basis. We should all support the goal of 
expanding diversity in ownership of broadcast properties. I am pleased 
that in the past Senator McCain introduced a similar proposal in the 
Senate. I am hopeful that we can find bipartisan support in the House.

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