[Federal Register Volume 85, Number 29 (Wednesday, February 12, 2020)]
[Rules and Regulations]
[Pages 7880-7892]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-01009]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 73

[MB Docket No. 19-3; FCC 19-127; FRS 16411]


Reexamination of the Comparative Standards and Procedures for 
Licensing Noncommercial Educational Broadcast Stations and Low Power FM 
Stations

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, the Commission adopts changes to its rules 
and procedures to select and license competing applications for new 
noncommercial educational (NCE) broadcast stations and low power FM 
(LPFM) stations. The changes are designed to improve the comparative 
selection procedures, reduce confusion among future applicants, 
expedite the initiation of new service to the public, and eliminate 
unnecessary applicant burdens.

DATES: Effective April 13, 2020, except for rule changes to Sec. Sec.  
73.865, 73.872, 73.7002(c), 73.7003, and 73.7005. The Commission will 
publish a separate document in the Federal Register announcing the 
effective date of these rules.

FOR FURTHER INFORMATION CONTACT: Albert Shuldiner, Chief, Media Bureau, 
Audio Division, (202) 418-2721; Lisa Scanlan, Deputy Division Chief, 
Media Bureau, Audio Division, (202) 418-2704; Amy Van de Kerckhove, 
Attorney Advisor, Media Bureau, Audio Division, (202) 418-2726. For 
additional information concerning the Paperwork Reduction Act (PRA) 
information collection requirements contained in this document, contact 
Cathy Williams at 202-418-2918, or via the internet at 
[email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report 
and Order (R&O), MB Docket No. 19-3; FCC 19-127, adopted on December 
10, 2019, and released on December 11, 2019. The full text of this 
document is available electronically via the FCC's Electronic Document 
Management System (EDOCS) website at http://fjallfoss.fcc.gov/edocs_public/ or via the FCC's Electronic Comment Filing System (ECFS) 
website at http://www.fcc.gov/ecfs. (Documents will be available 
electronically in ASCII, Microsoft Word, and/or Adobe Acrobat.) This 
document is also available for public inspection and copying during 
regular business hours in the FCC Reference Information Center, which 
is located in Room CY-A257 at FCC Headquarters, 445 12th Street SW, 
Washington, DC 20554. The Reference Information Center is open to the 
public Monday through Thursday from 8:00 a.m. to 4:30 p.m. and Friday 
from 8:00 a.m. to 11:30 a.m. The complete text may be purchased from 
the Commission's copy contractor, 445 12th Street SW, Room CY-B402, 
Washington, DC 20554. Alternative formats are available for people with 
disabilities (braille, large print, electronic files, audio format), by 
sending an email to [email protected] or calling the Commission's Consumer 
and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-
0432 (TTY).

Paperwork Reduction Act of 1995 Analysis

    This document contains new or modified information collection 
requirements subject to the Paperwork Reduction Act of 1995 (PRA), 
Public Law 104-13, see 44 U.S.C. 3507. The Commission, as part of its 
continuing effort to reduce paperwork burdens, will invite the general 
public and the Office of Management and Budget (OMB) to comment on the 
information collection requirements contained in this document in a 
separate Federal Register Notice, as required by the PRA. These new or 
modified information collections will become effective after the 
Commission publishes a document in the Federal Register announcing such 
approval and the relevant effective date.
    In addition, pursuant to the Small Business Paperwork Relief Act of 
2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), the Commission 
previously sought specific comment on how the Commission might further 
reduce the information collection burden for small business concerns 
with fewer than 25 employees.

Congressional Review Act

    The Commission will send a copy of this R&O to Congress and the 
Government Accountability Office (GAO) pursuant to the Congressional 
Review Act, 5 U.S.C. 801(a)(1)(A).

[[Page 7881]]

Synopsis

    1. Introduction. In this R&O, the Commission adopts changes to its 
rules and procedures for comparatively considering competing 
applications for new and major modifications to noncommercial 
educational FM radio stations, FM translator stations, and full power 
television stations (collectively, NCE or NCE broadcast) and low power 
FM (LPFM) stations, which it proposed in the notice of proposed 
rulemaking, 84 FR 10275 (March 20, 2019), FCC 19-9, 34 FCC Rcd 851 
(2019) (NPRM). Specifically, it adopts several of the proposals from 
the NPRM, including: (1) Eliminating the requirement that NCE 
applicants amend their governing documents to pledge to maintain 
localism and diversity in order to receive points for being an 
``established local applicant'' and for ``diversity of ownership''; (2) 
expanding the scope of the divestiture policies by recognizing station 
divestitures for comparative purposes; (3) improving and expanding the 
NCE tie-breaker process and reducing the need for mandatory time-
sharing; (4) establishing a mandatory time-sharing process, similar to 
the LPFM involuntary time-share rules, for mutually exclusive (MX) NCE 
applicants that are unable to arrive at a voluntary time-share 
agreement; (5) clarifying aspects of the ``holding period'' rule by 
which NCE permittees must maintain the characteristics for which they 
received comparative preferences and points; (6) clarifying the LPFM 
rules to specifically permit LPFM applicants to discuss their intent to 
aggregate points and time-share prior to tentative selectee 
designations; (7) aiding NCE and LPFM permittees by eliminating certain 
tolling notification requirements; (8) supporting LPFM permittees and 
licensees by extending the construction period from 18 months to a full 
three years; and (9) allowing the assignment or transfer of LPFM 
permits after an 18-month holding period and eliminating the three-year 
holding period on assigning LPFM licenses. The changes are designed to 
improve the comparative selection procedures, reduce confusion among 
future applicants, expedite the initiation of new service to the 
public, and eliminate unnecessary applicant burdens.
    2. Due to the noncommercial nature of the NCE and LPFM service, 
mutually exclusive (MX) applications for new station licenses are not 
subject to auction but are resolved by applying comparative procedures. 
This includes a point system, which is a simplified ``paper hearing'' 
method for selecting among MX applications. The NCE and LPFM 
comparative procedures used in past filing windows facilitated the 
grant of several thousand new station construction permits. Certain 
rules, however, confused applicants, drew criticism, or delayed the 
initiation of new service. Based on experience gained from the conduct 
of the prior NCE and LPFM filing windows, and the comments submitted in 
this proceeding, the Commission adopts changes to clarify, simplify, 
and otherwise improve its licensing procedures for new NCE broadcast 
and LPFM stations.
    3. Eliminate Governing Document Requirements for Established Local 
Applicants. The Commission adopts the NPRM's proposal to eliminate the 
requirement that NCE applicants claiming points as an established local 
applicant amend their governing documents to require that ``localism be 
maintained'' (Localism Governing Document Requirement). Commenters 
support this change, and none oppose it.
    4. Under the NCE point system selection process, to qualify as an 
``established local applicant,'' as defined in 47 CFR 73.7000, a party 
must certify that it has been local and established in the community to 
be served continuously for at least two years immediately prior to the 
application filing. Further, to receive three localism points, the 
rules currently require an applicant to submit in its initial 
application: (1) Documentation to illustrate how it qualifies as local 
and established; and (2) documentation demonstrating that the 
applicant's governing documents have been amended to require that 
``such localism be maintained'' (Localism Governing Document 
Requirement).
    5. The Commission will continue to enforce the existing requirement 
that an applicant submit substantiating documentation to verify that it 
has been local and established for at least two years immediately prior 
to the application filing. The Commission, however, eliminates the 
current 47 CFR 73.7003(b)(1) requirement that an applicant's governing 
documents be amended to include a localism provision, and the 
corresponding requirement to submit such documents to the Commission 
for all categories of applicants. The Commission believes, and 
commenters concur, that any benefits from the Localism Governing 
Document Requirement have been outweighed by the harm it has engendered 
in the licensing process.
    6. To keep the points meaningful and safeguard the localism goals, 
the Commission incorporates into the current holding period rule a new 
provision explicitly requiring any prevailing applicant that receives 
localism points during the point system analysis to maintain localism 
during the period from the grant of the construction permit until the 
station has achieved four years of on-air operations. The Commission 
believes this rule clarification, along with a certification pledging 
to maintain localism at the time of filing the Schedule 340 
application, will help protect the ``established local applicant'' 
criterion.
    7. Eliminate Governing Document Requirements for Applicants 
Claiming Diversity Points. The Commission adopts the proposal in the 
NPRM to simplify its diversity of ownership requirements by eliminating 
both: (1) The requirement that applicants amend their governing 
documents, or provide an alternative demonstration to guarantee that 
``diversity be maintained'' (the Diversity Governing Document 
Requirement), and (2) the requirement to submit such documents to the 
Commission and place the documentation in the applicant's public 
inspection file. The commenters addressing this proposal unanimously 
endorse this change.
    8. Under the point system selection process, two points are awarded 
for local diversity of ownership if the principal community contour of 
the applicant's proposed NCE station does not overlap with those of any 
other station in which either the applicant or any party to the 
application holds an attributable interest. To qualify for diversity 
points, the Commission requires applicants to document both current and 
future diversity. In particular, to document future diversity, an 
applicant is required to file a copy of its pertinent corporate 
governance documents, showing that it properly amended its governing 
documents to require the maintenance of diversity in the future. The 
Commission has found, and commenters agree, that the requirement had 
the unintended effect of frustrating and confusing many applicants, 
sparking numerous challenges regarding whether applicants sufficiently 
satisfied the requirement, disqualifying legitimate applicants that 
failed to comprehend the requirement, and delaying or curtailing the 
initiation of new NCE FM service. The R&O, therefore, eliminates the 
Diversity Governing Document Requirement for all applicants seeking to 
qualify for diversity points.
    9. To safeguard the Commission's diversity goals, the R&O 
incorporates into the current holding period rule a new provision 
prohibiting any prevailing applicant that receives diversity points 
during the point system

[[Page 7882]]

analysis from acquiring stations which would overlap the principal 
community contour of its new NCE station during the period from the 
grant of the construction permit until the station has achieved four 
years of on-air operations. The restriction will apply to the applicant 
itself, any parties to the application, and any party that acquires an 
attributable interest in the permittee or licensee during this period. 
The R&O also adds an additional question to FCC Schedule 340, FCC Form 
314, and FCC Form 315, requiring applicants to certify that the 
proposed acquisition would comply with the subject authorization's 
diversity condition.
    10. Establish Uniform Divestiture Pledge Policies. The R&O adopts 
the NPRM's proposal to expand the scope of the Commission's divestiture 
policies by recognizing full-service station divestiture pledges for 
comparative purposes and crediting all contingent divestiture pledges 
that are made and submitted in the application by the close of the 
filing window.
    11. The Commission examines an applicant's qualifications for 
comparative points, including diversity of ownership, as of the close 
of the filing window. The Commission previously held that, generally, a 
contingent pledge to divest an attributable broadcast interest or 
resign from an attributable positional interest is an ineffective 
mechanism to avoid the attribution of broadcast interests. Although the 
Commission has carved out exceptions to this general policy and accepts 
contingent divestiture pledges for some secondary services, the 
Commission has never allowed applicants to utilize contingent 
divestiture pledges to exclude full-service stations from the diversity 
of ownership consideration.
    12. The Commission finds no compelling reason to continue to limit 
acceptable divestiture pledges for NCE applicants to only secondary 
service interest holdings, and commenters agree. The Commission 
concludes that the public interest is better served by permitting all 
applicants and parties to maintain continuity of service to the public 
during the licensing and construction process. Accordingly, the 
Commission will permit an NCE applicant with any type of overlapping 
attributable broadcast interest to qualify for diversity of ownership 
points if it commits to divest the broadcast interest or resign from 
the attributable positional interest. The Commission explains that the 
divestiture pledge must be submitted by the close of the filing window. 
The actual divestiture or resignation must be completed by the time the 
new NCE station commences program test operations.
    13. Expand Tie-Breaker Criteria. The R&O expands the Commission's 
tie-breaker criteria to add an additional tie-breaker round, and 
therefore, minimize the need to resort to the unpopular last-resort 
tie-breaker option, mandatory time-sharing. Under the NCE point system 
process, applicants tied with the highest number of points awarded in a 
MX group proceed to a tie-breaker round. If the tie is not broken, the 
Commission uses mandatory time-sharing as the tie-breaker of last 
resort for full-service NCE stations. The Commission has previously 
acknowledged that mandatory time-sharing ``can be difficult for 
applicants with different missions, philosophies, or formats'' as well 
as ``confusing to audiences and potentially inefficient to listeners.'' 
The NPRM, therefore, sought comment on whether there are further tie-
breaking measures the Commission should use, and therefore, minimize 
the need to resort to the final mandatory time-sharing option.
    14. The R&O adopts Discount Legal's proposal that an applicant be 
granted a dispositive tie-breaker preference if it can demonstrate 
that: (1) It applied in a previous filing window, and had its 
application accepted for filing and processed, but subsequently 
dismissed in favor of an applicant possessing superior points or a tie-
breaker showing; and (2) it was in continuous existence as a legal 
entity at all times from the date of the previous NCE window filing 
until the present. The Commission concludes that Discount Legal's 
proposal is a practical, fair, and effective way to improve and apply 
the current tie-breaker process, award new permits to deserving 
legitimate applicants, and minimize resorting to the mandatory time-
share option. Accordingly, the R&O incorporates Discount Legal's 
proposal into the Commission's rules as the third and final tie-breaker 
criterion. The tie-breaker is limited to applicants that were 
unsuccessful in all previous NCE windows in which they participated and 
have no NCE permits or licenses. In the event a tie is still not 
resolved after this new third tie-breaker criterion, the Commission 
will impose mandatory time-sharing on the remaining applicants
    15. Revise Procedures for Allocating Time in NCE Mandatory Time-
Sharing Situations. The R&O adopts mandatory time-share rules and 
procedures for mutually exclusive NCE applicants, modeled after the 
current LPFM rules, including a rule to delineate an explicit deadline 
for submitting voluntary time-share agreements and detailed steps to 
allocate time to NCE tentative selectees that are unable to arrive at a 
voluntary time-share agreement within the allotted deadline. The new 
rules are designed to expedite new NCE service to the public and expand 
the diversity of voices available to radio audiences.
    16. The NPRM proposed rules and procedures for mutually exclusive 
NCE tentative selectees that are unable to reach a voluntary time-share 
agreement, modeled after the LPFM service rules. Commenters agree with 
the proposed changes. The R&O, therefore, adopts an explicit 90-day 
deadline and requires tied NCE applicants to file voluntary time-share 
agreements within 90 days of the release of the public notice or order 
announcing the tie. If mutually exclusive tied NCE applicants are 
unable to reach a voluntary time-share agreement within the designated 
90-day period, the applicants will now proceed to mandatory time-
sharing, modeled after the LPFM involuntary time-share rules, which 
have worked effectively to resolve mutual exclusivities and expedite 
new service to the public. Pursuant to the new mandatory time-share 
rules, NCE applicants with tied, grantable applications will be 
eligible for equal, concurrent, non-renewable license terms. The number 
of mandatory time-share applicants is limited to three. Although some 
commenters suggested no limit, the Commission explains that mandatory 
time-shares with more than three applicants may be cumbersome, may 
result in the licensees obtaining too few hours for programming and 
prove difficult to allocate time-slots and assign the applicants an 
equal number of hours per week. If there are more than three tied, 
grantable applicants in an MX group, the Commission will use the date 
of established presence in the local community as the cut-off 
mechanism, and therefore, dismiss all but the applications of the three 
applicants that have been local for the longest uninterrupted periods 
of time.
    17. To effectuate this process, the Commission will require each 
applicant to provide, as part of its initial application, its date of 
established presence in the local community. The R&O also adopts time 
slots and selection procedures modeled after the LPFM service. 
Specifically, when there are three remaining tied NCE applicants in an 
MX group, the Commission will assign each applicant one of the 
following time slots: 2 a.m.-9:59 a.m., 10 a.m.-5:59 p.m., and 6 p.m.-
1:59 a.m. If there are only two applicants, the Commission will assign 
each one of the following time slots: 3 a.m.-2:59 p.m., or 3 p.m.-2:59 
a.m. The Bureau staff will allow the NCE applicants to

[[Page 7883]]

confidentially select their preferred time slots, giving preference to 
the applicant that has been local for the longest uninterrupted period 
of time. In the event an applicant neglects to designate its preferred 
time slot, the Bureau staff will select a time slot for the applicant. 
Finally, to ensure that there is no gamesmanship, the Commission will 
require the applicants to certify that they have not colluded with any 
other applicants in the selection of time slots.
    18. Clarify and Modify the ``Holding Period'' Rule. The R&O adopts 
both stylistic and substantive changes to 47 CFR 73.7005 (the Holding 
Period Rule) to (1) better promote the goal of ensuring that the 
comparative selection process is meaningful and the public receives the 
benefit of the best proposal, and (2) aid permittees and licensees by 
eliminating the current absolute bar on any section 307(b) preference-
related service downgrade. The commenters who addressed this issue 
generally agree with the changes, with some suggested modifications.
    19. First, the Commission renames Sec.  73.7005 of the rules 
``Maintenance of comparative qualifications.'' Second, the Commission 
adopts a new provision to Sec.  73.7005 to establish, for the first 
time, specific timing requirements for maintaining comparative 
qualifications. Specifically, NCE permittees and licensees issued 
authorizations under comparative procedures must maintain their 
comparative qualifications from the grant of the construction permit 
until the station has achieved at least four years of on-air 
operations. Although Prometheus contends that a four-year maintenance 
period is not sufficient and suggests a ten-year maintenance period, 
the Commission explains that a four-year period strikes the correct 
balance and is sufficient to establish meaningful service for the 
community and deter license speculators, while not unduly burdening the 
licensee.
    20. Third, the Commission relaxes Sec.  73.7005(b) and the parallel 
provision in Sec.  73.7002(c) (Fair distribution of service on reserved 
band FM channels) to eliminate the current absolute bar on any 
preference-related service downgrade. The Commission explains that it 
will allow minor modifications, provided that any potential loss of 
first and/or second NCE FM service is offset by first and, separately, 
combined first and/or second NCE FM service population gain(s). This 
rule change is designed to aid permittees and licensees by allowing 
them reasonable flexibility to implement facility modifications while 
also benefiting the public by limiting service losses to areas in which 
the NCE FM station is providing section 307(b)-preferred service.
    21. Prohibit Amendments to Cure Section 301 Violations by 
Application Parties. The Commission amends its rules to preclude an 
LPFM applicant dismissed due to unauthorized broadcasting from seeking 
nunc pro tunc reinstatement of its application and to disallow any 
change in directors as a means of resolving the applicant's basic 
qualifications under 47 CFR 73.854. Section 632(a)(1)(B) of the Making 
Appropriations for the Government of the District of Columbia for 
Fiscal Year 2001 Act ``prohibit[s] any applicant from obtaining a low 
power FM license if the applicant has engaged in any manner in the 
unlicensed operation of any station in violation of section 301 of the 
Communications Act of 1934.'' Section 73.854 of the rules and FCC 
Schedule 318 implement this mandate by requiring an LPFM applicant to 
certify under penalty of perjury that neither the applicant, nor any 
party to the application, has engaged in any manner in unlicensed 
operation of any station. There is currently no explicit rule, however, 
precluding an LPFM applicant dismissed for violations of the 
Appropriations Act and Sec.  73.854 from seeking nunc pro tunc 
reinstatement by amending its application to remove board members that 
have engaged in unauthorized broadcasting, and no rule barring an LPFM 
applicant from making a minor board of directors change to cure an 
``unauthorized broadcasting'' ownership defect. The R&O incorporates 
these restrictions, which are consistent with Bureau policy, into the 
rules.
    22. Although commenters disagree on the breadth of the changes, the 
Commission declines to adopt suggestions to make the rule more 
encompassing, or less harsh. The Commission explains that the rule was 
implemented to specifically address Congress's direct mandate to treat 
unlicensed broadcasting as disqualifying, not to address a myriad of 
additional application defects. The Commission also explains that it 
continues to believe that a restriction on corrective amendments to 
resolve basic qualification issues under Sec.  73.854 is not too harsh, 
but rather, is in keeping with the intent of the Appropriations Act and 
reflects the seriousness with which the Commission treats unauthorized 
broadcasting.
    23. Permit Time-Sharing Agreements Prior to Tentative Selectee 
Designations. The R&O modifies 47 CFR 73.872(c) to specifically permit 
LPFM point aggregation discussions and agreements at any point before 
the Bureau implements the involuntary time-share procedures, including 
prior to tentative selectee designations, if any such agreement is 
conditioned on each of the parties subsequently achieving tentative 
selectee status. The Commission also modifies its rules to limit the 
number of applicants that can enter into a time-sharing arrangement to 
three.
    24. The Commission explains that although its procedures for 
voluntary time-share agreements have generally been an efficient and 
effective means for resolving mutual exclusivity among tied LPFM 
applicants, there has been confusion as to whether LPFM applicants can 
communicate and collaborate with each other, either pre- or post-
application filing, with the goal of potentially aggregating points. 
Accordingly, in the NPRM the Commission sought comment on amending its 
rules to explicitly allow applicants to communicate and collaborate on 
time sharing arrangements, and what, if any, safeguards are needed to 
limit the potential for gamesmanship. The commenters generally agree on 
allowing communication and collaboration during the LPFM application 
process. The Commission explains that it continues to believe this type 
of cooperation can help ensure increased service to the public, and 
accordingly, amends its rules to explicitly allow LPFM point 
aggregation discussions and agreements, provided that the agreement is 
conditioned on each application becoming a tentative selectee.
    25. The commenters disagree widely on what safeguards, if any, are 
necessary to prevent gamesmanship, and whether to limit the number of 
organizations that can enter into a time-sharing agreement. Several 
commenters urge the Commission to place no limit on the number of 
applicants that can enter into a time-sharing agreement. REC recommends 
limiting time-share agreements to no more than three proponents and 
adopting safeguard provisions to create ``viable time-share 
agreements.''
    26. The Commission recognizes that there are indeed benefits, as 
many commenters note, of placing no explicit limit on the number of 
applicants that can enter into a point aggregation agreement. The 
Commission, however, also recognizes that it encourages LPFM stations 
to originate programming locally by awarding one point to each MX 
applicant that pledges to provide at least eight hours per day of local 
programming. The Commission explains that if it continues to place no 
limit on point aggregation, each applicant in a group with more than 
three applicants

[[Page 7884]]

will not be able to fulfill this local origination commitment. The R&O, 
therefore, caps the number of applicants that can aggregate points at 
three to better align with the eight hours of local programming pledge 
and ensure that the pledge is enforceable. The Commission declines, 
however, to adopt REC's other ``safeguard'' proposals, including the 
proposal to require time share applicants to specify different 
transmitter sites with a minimum separation from the other proponents. 
The Commission explains that this suggested safeguard would 
unnecessarily penalize future LPFM applicants and hamper the cost 
efficiencies of timesharing.
    27. Finally, the Commission declines to reconsider the current 
process for reapportioning time following the surrender or expiration 
of a construction permit or license of a time-share party. Currently, 
following the award of voluntary time-share construction permits, if 
one of the participants in a voluntary time-sharing arrangement does 
not construct, or surrenders its station license after commencing 
operations, the remaining time-share participants are free to apportion 
the vacant air-time as they see fit. Although two commenters expressed 
support for requiring abandoned air-time to instead be made available 
in a mini-window, the Commission explains that mini-windows are a 
complicated solution that would likely pose a great administrative 
burden while providing only minimal benefits. Moreover, the Commission 
explains that its elimination of the absolute prohibition on the 
assignment and transfer of LPFM construction permits and the three-year 
holding period for LPFM licenses is a necessary change that will help 
to ensure viable community groups build LPFM stations. Accordingly, the 
R&O does not adopt a mini-window approach. Rather, if one of the 
participants in a voluntary time-sharing arrangement does not 
construct, or chooses to surrender its station license after commencing 
operations, the particular permittee or licensee may either (1) seek 
Commission consent to assign or transfer its existing permit or license 
to another qualified party; or (2) surrender the existing permit or 
license to the Commission, and the remaining time-share participants 
can apportion the vacant air-time as they see fit pursuant to 47 CFR 
73.872(c)(3).
    28. Establish Procedures for Remaining Tentative Selectees 
Following Dismissal of Accepted Point Aggregation Time Share 
Agreements. The Commission amends its rules to codify a procedure that 
when a tentatively accepted time-share agreement is dismissed, the 
Bureau will resume the processing of any remaining tentative selectees. 
As proposed in the NPRM, the Commission will announce a second 90-day 
period, affording all remaining applicants tied for the highest point 
total within the affected MX group a further opportunity to enter into 
either a universal settlement or a voluntary time-share arrangement.
    29. The Commission declines to shorten the time-period for filing 
voluntary time-sharing arrangements, as one commenter suggests. The 
Commission explains that it believes a 90-day period is necessary to 
allow applicants sufficient time to negotiate and reach viable 
agreements. The Commission also declines to amend its rules to allow 
for a third 90-day period, explaining that such a change would have 
minimal benefit, but rather, would create an administrative burden and 
delay the initiation of new LPFM service.
    30. The Commission codifies the following procedural changes. 
Following the dismissal of a tentatively-accepted time-share agreement, 
the Commission will direct the Bureau to release a public notice to 
initiate a second 90-day period, affording all remaining tentative 
selectees within the affected MX group a further opportunity to enter 
into either a universal settlement or a voluntary point-aggregating 
time-share arrangement in accordance with Sec.  73.872(c) and (e). The 
Commission directs the Bureau to dismiss all pending point aggregation 
amendments/agreements when it releases the public notice commencing the 
new settlement period. If applicants are unable to reach voluntary 
agreements during this subsequent 90-day period, the Commission will 
assign involuntary time-sharing arrangements to no more than three of 
the tied applicants in each MX Group.
    31. NCE and LPFM Board Changes. To decrease regulatory burdens and 
provide certainty, the Commission amends its rules to classify as 
``minor'' most board changes for nonstock and membership NCE and LPFM 
applicants. The Commission will also treat all board changes in a 
governmental applicant as minor.
    32. The NCE and LPFM new station application processes are governed 
by Sec. Sec.  73.3572, 73.3573, and 73.871, respectively, each of which 
define as a ``major change'' any amendment to an application where the 
original party or parties to the application do not retain more than 50 
percent ownership interest in the application as originally filed. The 
Commission's current practice is to consider waivers for gradual 
(although not sudden) majority board changes occurring while a new 
station application is pending. Because the current waiver approach has 
led to uncertainty for NCE and LPFM applicants undergoing board changes 
as a regular or natural part of their organizational function, the NPRM 
proposed to amend the rules to classify as ``minor'' any gradual board 
changes in nonstock and membership NCE and LPFM applicants, even when 
they result in a change in the majority of such organization's 
governing board.
    33. The Commission declines to adopt Public Broadcasting and Joint 
NCE Licensee's approach of considering any change in an NCE or LPFM 
applicant governing board, regardless of the timing and regardless of 
whether it changes the majority of the governing board, as minor. The 
Commission explains that it is not feasible or appropriate in light of 
the wide, diverse range of NCE and LPFM applicants and its experience 
with previous application filing windows when it identified problematic 
board changes. The Commission recognizes that a although a change in 
the composition of the board generally does not alter the nature of the 
NCE or LPFM applicant itself, there are nevertheless instances where a 
majority board change is indicative of gamesmanship or takeover issues. 
The commenters' suggested approach would not allow the Commission to 
detect such issues and respond to such circumstances, which is 
inconsistent with its processing regime.
    34. The Commission, however, concurs with Public Broadcasting and 
the Joint NCE Licensees that all changes to governing boards of 
governmental applicants should be treated as minor and adopts this 
proposal from the NPRM. The Commission also agrees that it is 
unnecessary to make a finding that changes in governmental applicants 
have no effect on the applicant's mission and will omit this 
requirement from its rules. For non-governmental applicants, the 
Commission will continue to treat gradual board changes as minor. The 
Commission recognizes that nonprofit organizations often have routine 
or mandated changes in board members that do not impact the 
organization or its operations, and accordingly, will treat all routine 
board turnover changes due to term expirations, resignations, etc. as 
minor. For sudden board changes that take place over the course of less 
than six months, the Commission will treat those changes as minor 
unless there is evidence that the change in the board is the result of 
a conflict within the

[[Page 7885]]

organization, an attempted takeover or some other change that would 
change the essence or mission of the organization. To the extent that 
an ownership change is not solely board-related, the Commission is not 
modifying the existing standard for what constitutes a major change. 
The rule changes will allow the Commission to avoid micromanaging the 
composition of nonprofit boards and discontinue the current potentially 
subjective and time-consuming waiver process, while deterring abuses. 
Finally, the Commission emphasizes that any applicant undergoing a 
change of its governing board, even if considered minor under the new 
rules, is required to notify the Bureau of the changes via an amendment 
to its application, in accordance with 47 CFR 1.65.
    35. LPFM-specific transferability issues for permittees and 
licensees. The Commission clarifies how board changes impact LPFM 
licensees and permittees under rule 73.865. The modification is 
intended to provide clarity to LPFM permittees and licensees that a 
sudden change of control of more than 50 percent of an LPFM board is 
permitted at any time, provided that the affected permittee or licensee 
files a pro forma FCC Schedule 316 for a sudden majority board change. 
The Commission also clarifies that the 316 application must be filed 
within 30 days of the final event that caused the LPFM permittee or 
licensee to exceed the 50 percent threshold (for example, within 30 
days of the election of a third new board member out of five within a 
year).
    36. Clarify Reasonable Site Assurance Requirements. To promote 
compliance with the reasonable site assurance requirement and the 
efficient processing of NCE and LPFM applications, the Commission 
implements FCC Schedule 318 and Schedule 340 instruction and 
application form changes, including adding a reasonable assurance of 
site certification to these applications. When an applicant files an 
application, it must have reasonable assurance that its specified site 
will be available for the construction and operation of its proposed 
facilities. Despite this obligation, NCE and LPFM station applicants 
have never been required to certify the availability of proposed 
transmitter sites in the NCE and LPFM construction permit applications, 
and the Instructions to the NCE and LPFM construction permit 
applications do not explain the Commission's site availability 
requirements. This lack of clarity led to speculative applications, 
numerous site availability challenges, and processing delays. The 
commenters agree that application form changes are necessary to address 
these issues.
    37. Although some commenters argue that requiring site assurance 
documentation could be burdensome, the Commission explains that any 
purported burden of a combined site certification and the minimal 
documentation requirement is offset by the resulting benefits of 
reducing frivolous and speculative applications, deterring site 
availability challenges, and promoting the expeditious processing of 
applications and initiation of service to the public. The Commission, 
therefore, directs the Bureau to take the following steps. First, it 
will update the FCC Schedule 318 and Schedule 340 Instructions to 
explain the requirement of obtaining reasonable site availability prior 
to the application filing. Second, it will amend the FCC Schedule 318 
and Schedule 340 to add a question requiring an applicant to certify 
that it has obtained reasonable assurance from the tower owner, its 
agent, or authorized representative that its specified site will be 
available. The certification will require the applicant to list the 
name and telephone number of the person contacted, and specify whether 
the contact is a tower owner, agent, or authorized representative.
    38. Streamline Tolling Procedures and Notification Requirements. 
The Commission adopts the NPRM's proposal to simplify the tolling 
procedures for NCE and LPFM permittees, including the current tolling 
notification requirements for these services. Broadcast construction 
permits terminate and, thus, are forfeited, if the permittee does not 
complete construction and file a covering license application prior to 
expiration. Although the Commission will ``toll'' the broadcast 
construction period when an original construction permit is encumbered 
by certain circumstances beyond the permittee's control, tolling 
treatment is not automatic but rather requires notification from the 
permittee.
    39. Because the Commission has characterized tolling notification 
requirements as an unnecessary bureaucratic hurdle for LPFM permittees 
with limited resources, the NPRM proposed to shift the onus of 
identifying a tolling event from the permittee to the Commission staff 
in certain situations. The R&O streamlines the tolling procedures for 
both NCE and LPFM permittees as follows. The Commission will identify 
and place into a tolling posture any NCE or LPFM construction permit: 
(1) That includes a condition on the commencement of operations and the 
Commission has a direct licensing role in the satisfaction of this 
condition; (2) that is subject to administrative or judicial review of 
the permit grant; or (3) that is subject to international coordination. 
In such situations, the Commission directs the Bureau staff to add 
appropriate tolling codes to the broadcast database. Permits tolled by 
staff under these revised procedures will not be subject to the six-
month update requirement. Rather, the Commission will be responsible 
for ending tolling treatment and notifying the permittee of such 
termination upon the resolution of the pertinent encumbrance. These 
changes are limited to NCE and LPFM stations, services which have more 
commonly encountered challenges with the current tolling procedures.
    40. Lengthen LPFM Construction Period. The Commission adopts the 
NPRM's proposal to lengthen the construction period for LPFM permittees 
from 18-months to a full three-years. Commenters agree that lengthening 
the construction period will have the dual benefit of aiding LPFM 
permittees struggling to complete construction and eliminating the 
administrative burdens associated with filing and processing waiver 
requests. The Commission amends 47 CFR 73.3598(a) to extend the LPFM 
construction period to three years. The extended construction period 
will apply to both existing LPFM permits, which have not yet expired as 
of the effective date of the new rule and will now expire three years 
from the original grant of the permit, and prospectively to new permits 
granted after the new rule takes effect.
    41. Modify Restrictions on the Transfer and Assignment of LPFM 
Authorizations. The Commission adopts the NPRM's proposal, which was 
initiated by REC, to eliminate both the absolute prohibition on the 
assignment and transfer of LPFM construction permits and the three-year 
holding period for LPFM licenses. The Commission also adopts an 18-
month holding period on the assignment and transfer of original LPFM 
construction permits and requires the assignee or transferee of the 
authorization to satisfy certain ownership and eligibility criteria 
including compliance with the Holding Period rule. No commenter objects 
to these changes.
    42. Some commenters, however, disagree on whether and how to limit 
consideration for the sale of the authorization. The Commission 
declines to adopt a proposal to remove the requirement that all sales 
be capped at fair market value. As the Commission has previously 
emphasized, the for-profit sale of LPFM authorizations is

[[Page 7886]]

inconsistent with the goal of promoting local, community-based use and 
ownership of LPFM stations. The Commission explains that it believes 
that allowing the for-profit sale could have the adverse effect of 
enabling gamesmanship and the trafficking in licenses by those with no 
genuine interest in providing LPFM service. The Commission, therefore, 
retains the prohibition on the for-profit sale of LPFM authorizations, 
uses the same consideration standard that it applies to full-service 
NCE FM stations, and restricts consideration received or promised to 
the assignor's or transferor's ``legitimate and prudent expenses.'' 
``Legitimate and prudent expenses'' are those expenses reasonably 
incurred by the assignor or transferor in obtaining and constructing 
the station (e.g., expenses in preparing an application, in obtaining 
and installing broadcast equipment to be assigned or transferred, 
etc.), but do not include costs incurred in operating the station (e.g. 
rent, salaries, utilities, music licensing fees, etc.).
    43. The Commission modifies its rules to permit parties to assign 
or transfer LPFM permits and station licenses, provided that the 
following safeguards are satisfied: (1) The assignment or transfer does 
not occur prior to 18 months from the date of issue of the initial 
construction permit; (2) consideration promised or received does not 
exceed the legitimate and prudent expenses of the assignor or 
transferor; (3) the assignee or transferee satisfies all eligibility 
criteria that apply to a LPFM license; and (4) for a period of time 
commencing with the grant of any permit awarded on the basis of the 
comparative point system provisions of 47 CFR 73.872, and continuing 
until the station has achieved at least four years of on-air 
operations, (a) the assignee or transferee must meet or exceed those 
points awarded to the LPFM tentative selectee, and (b) for LPFM 
stations selected in accordance with the involuntary time-sharing 
provisions of 47 CFR 73.872(d), the date the assignee or transferee was 
``locally established'' must be the same as or earlier than the date of 
the most recently established local applicant in the tied MX group.

Procedural Matters

    44. Regulatory Flexibility Analysis. As required by the Regulatory 
Flexibility Act of 1980 (RFA), as amended, an Initial Regulatory 
Flexibility Certification was incorporated into the NPRM. The 
Commission sought written public comment on the proposals in the NPRM, 
including comment on the IRFA. Because the Commission amended the rules 
in this R&O, it included this Final Regulatory Flexibility Analysis 
(FRFA) which conforms to the RFA.
    45. Need for, and Objectives of, the R&O. The R&O adopts several 
rule changes that are intended to clarify and simplify the point 
systems used to evaluate competing applications for both NCE full-
service FM, full power television, and FM translator broadcast stations 
and LPFM broadcast stations, and related NCE and LPFM application 
processing rules. Specifically, in the R&O the Commission adopts new 
rules and procedures to: (1) Eliminate the current requirement that NCE 
applicants amend their governing documents, pledging that localism/
diversity be ``maintained in the future,'' in order to receive 
comparative points as an ``established local applicant'' and or 
``diversity of ownership''; (2) expand the scope of the current 
divestiture policy by awarding points based on a contingent pledge to 
divest an interest in an existing full-service station, therefore 
allowing applicants to maintain continuity of service during the 
licensing and construction process; (3) expand the current two tie-
breaker criteria to add an additional tie-breaker round and thus reduce 
the need for mandatory time-sharing; (4) clarify aspects of the 
``holding period'' to better promote the goal of ensuring that the 
comparative selection process is meaningful and the public receives the 
benefit of the best proposal; (5) disallow any LPFM post-filing window 
change in directors as a means of resolving an alleged history of 
unauthorized operations by a party to the application; (6) adopt new 
rules authorizing early time-sharing discussions among LPFM applicants 
and limit the number of applicants that can enter into a time-sharing 
arrangement to three; (7) establish a process pursuant to which the 
Media Bureau will resume the processing of any remaining tentative 
selectees following the dismissal of a tentatively accepted time-share 
agreement; (8) modify the NCE and LPFM application forms to clarify the 
existing requirement for applicants to obtain reasonable assurance of 
site availability and add a reasonable assurance of site certification 
to these forms; (9) toll, meaning temporarily stop the construction 
clock, NCE and LPFM broadcast construction deadlines without 
notification from the permittee, based on certain pleadings pending 
before, or actions taken by, the agency; (10) lengthen the LPFM 
construction period from 18 months to three years; (11) allow the 
assignment and transfer of LPFM construction permits after an 18-month 
holding period; and (12) eliminate the three-year holding period for 
the assignment and transfer of LPFM licenses. The new rules and 
procedures are designed to clarify the comparative requirements, 
minimize confusion among applicants, deter speculative applications, 
reduce burdens upon NCE and LPFM broadcasters, and initiate service to 
the public quickly and efficiently.
    46. Summary of Significant Issues Raised by Public Comments in 
Response to the IRFA. No comments were filed to the IRFA.
    47. Response to Comments by the Chief Counsel for Advocacy of the 
Small Business Administration. Pursuant to the Small Business Jobs Act 
of 2010, which amended the RFA, the Commission is required to respond 
to any comments filed by the Chief Counsel for Advocacy of the Small 
Business Administration (SBA), and to provide a detailed statement of 
any change made to the proposed rules as a result of those comments. 
The Chief Counsel did not file any comments in response to the proposed 
rules in this proceeding.
    48. Description and Estimate of the Number of Small Entities to 
Which the Proposed Rules Will Apply. RFA directs agencies to provide a 
description of and, where feasible, an estimate of the number of small 
entities that may be affected by the proposed rules, if adopted. The 
RFA generally defines the term ``small entity'' as having the same 
meaning as the terms ``small business,'' ``small organization,'' and 
``small governmental jurisdiction.'' In addition, the term ``small 
business'' has the same meaning as the term ``small business concern'' 
under the Small Business Act. A small business concern is one which: 
(1) Is independently owned and operated; (2) is not dominant in its 
field of operation; and (3) satisfies any additional criteria 
established by the SBA.
    49. The new rules will apply to applicants, permittees, and 
licensees within the LPFM service, NCE full power television service, 
and to radio stations licensed to operate on channels reserved as 
``noncommercial educational,'' either within the reserved band of the 
FM spectrum or designated solely for noncommercial educational FM use 
through the Commission's allocations process. Most affected entities 
will be applicants for which a ``point system'' process is used to 
compare their qualifications with those of competing applicants. 
However, the rule changes concerning reasonable site assurance and 
tolling of broadcast construction deadlines will also affect

[[Page 7887]]

applications granted outside of the comparative process, such as those 
that are ``singletons'' or resolved by settlement among originally 
conflicting parties. Below is a description of these small entities, as 
well as an estimate of the number of such small entities, where 
feasible.
    50. NCE FM Radio Stations. The new rules and policies will apply to 
NCE FM radio broadcast licensees, and potential licensees of NCE FM 
radio service. This Economic Census category ``comprises establishments 
primarily engaged in broadcasting aural programs by radio to the 
public.'' The SBA has created the following small business size 
standard for this category: Those having $41.5 million or less in 
annual receipts. Census data for 2012 show that 2,849 firms in this 
category operated in that year. Of this number, 2,806 firms had annual 
receipts of less than $25 million, and 43 firms had annual receipts of 
$25 million or more. Because the Census has no additional 
classifications that could serve as a basis for determining the number 
of stations whose receipts exceeded $41.5 million in that year, the 
Commission concludes that the majority of radio broadcast stations were 
small entities under the applicable SBA size standard. In addition, the 
Commission has estimated the number of noncommercial educational FM 
radio stations to be 4,122. NCE stations are non-profit, and therefore 
considered to be small entities.
    51. The changes adopted herein will primarily impact potential 
licensees. The Commission accepts applications for new NCE FM radio 
broadcast stations in filing windows. There are no pending applications 
remaining from previous NCE FM filing windows. The Commission 
anticipates that in future filing windows it will receive a number of 
applications similar to past filing windows and that all such 
applicants will qualify as small entities. The last filing window for 
reserved band FM spectrum occurred in 2007 and generated approximately 
3,600 applications, of which approximately 2,700 were mutually 
exclusive. The last filing window for channels reserved for NCE use 
through the allotment process was held in 2010, and generated 323 
applications, virtually all of which were mutually exclusive. This 
estimate may overstate the number of potentially affected applicants 
because filing windows typically include some proposals that need not 
be resolved by a point system, such as those resolved through 
settlement agreements.
    52. FM Translator Stations and Low Power FM Stations. The changes 
adopted herein will affect licensees of FM translator stations and LPFM 
stations, as well as potential licensees in these radio services. The 
same SBA definition that applies to radio stations applies to low power 
FM stations. As noted, the SBA has created the following small business 
size standard for this category: Those having $41.5 million or less in 
annual receipts. While the U.S. Census provides no specific data for 
these stations, the Commission has estimated the number of licensed low 
power FM stations to be 2,186. In addition, as of September 30, 2019, 
there were a total of 8,177 FM translator and FM booster stations. 
Given the fact that low power FM stations may only be licensed to not-
for-profit organizations or institutions that must be based in their 
community and are typically small, volunteer-run groups, the Commission 
will presume that these licensees qualify as small entities under the 
SBA definition.
    53. The new rules will primarily affect applicants in future FM 
translator and LPFM windows. The Commission anticipates that in future 
filing windows it will receive a number of applications similar to past 
filing windows and that all applicants will qualify as small entities. 
The last LPFM filing window in 2013 generated approximately 2,827 
applications. The 2003 FM translator filing window generated 
approximately several hundred applications from NCE applicants, of 
which approximately 69 were mutually exclusive.
    54. NCE Television Stations. This Economic Census category 
``comprises establishments primarily engaged in broadcasting images 
together with sound.'' These establishments operate television 
broadcast studios and facilities for the programming and transmission 
of programs to the public. These establishments also produce or 
transmit visual programming to affiliated broadcast television 
stations, which in turn broadcast the programs to the public on a 
predetermined schedule. Programming may originate in their own studio, 
from an affiliated network, or from external sources. The SBA has 
created the following small business size standard for such businesses: 
Those having $41.5 million or less in annual receipts. The 2012 
Economic Census reports that 751 firms in this category operated in 
that year. Of this number, 656 had annual receipts of $25 million or 
less, 25 had annual receipts between $25 million and $49,999,999, and 
70 had annual receipts of $50 million or more. Based on this data the 
Commission therefore estimates that the majority of noncommercial 
television broadcasters are small entities under the applicable SBA 
size standard. Specifically, the Commission has estimated the number of 
licensed noncommercial educational (NCE) television stations to be 380. 
The Commission, however, does not compile and otherwise does not have 
access to information on the revenue of NCE stations that would permit 
it to determine how many such stations would qualify as small entities.
    55. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements. The rule changes adopted in the R&O will, in a 
few cases, impose different reporting requirements on potential NCE 
full-service stations, NCE FM Translators, and LPFM licensees and 
permittees. Specifically, the R&O creates a new submission of 
information verifying that the applicant obtained reasonable assurance 
of site availability. The applicant will be required to list the name 
and telephone number of the person contacted to obtain site assurance, 
and specify whether the contact is a tower owner, agent, or authorized 
representative. Any additional burden, however, will be minimal because 
the underlying requirement to obtain such assurance is currently a 
prerequisite to the application filing. Likewise, NCE applicants 
seeking points as ``established local applicants'' or for ``diversity 
of ownership'' will be required to provide information that is 
different from that currently required. The Commission believes that 
the new information will be simpler for applicants to produce because 
applicants will no longer be required to amend their governing 
documents. The elimination of certain tolling notification 
requirements, and shifting the onus of identifying a tolling event from 
the permittee to Commission staff in certain situations, will decrease 
burdens on applicants that experience encumbrances preventing 
construction. An NCE or LPFM permittee will receive additional 
construction time for which it qualifies without initiating a process 
to notify the Commission of actions taken by or pending within the 
Commission. By lengthening the LPFM construction period to three years, 
LPFM permittees needing more than the current 18-month construction 
period will no longer need to file and justify requests for an 18-month 
extension. Finally, by adopting the proposals to clarify and/or modify 
application requirements that applicants have found confusing, the 
burdens on applicants to file and/or respond to petitions challenging 
point claims will be reduced.

[[Page 7888]]

    56. Steps Taken to Minimize Significant Impact on Small Entities, 
and Significant Alternatives Considered. The RFA requires an agency to 
describe any significant alternatives that it has considered in 
reaching its proposed approach, which may include the following four 
alternatives (among others): (1) The establishment of differing 
compliance or reporting requirements or timetables that take into 
account the resources available to small entities; (2) the 
clarification, consolidation, or simplification of compliance or 
reporting requirements under the rule for small entities; (3) the use 
of performance, rather than design, standards; and (4) an exemption 
from coverage of the rule, or any part thereof, for small entities.
    57. The rules adopted herein are intended to assist NCE full-
service broadcast stations, NCE FM Translator, and LPFM broadcast 
applicants by clarifying and simplifying requirements for claiming and 
maintaining qualifications that are used to compare competing 
applications. The new rules and procedures will enable such applicants: 
(1) To claim comparative points without the burdensome process of 
amending their governing documents; and (2) to maintain existing full-
service broadcast operations by allowing contingent pledges that do not 
require divestment of existing interests prior to application grant. 
The new rules will also: (1) Expand the current two tie-breaker 
criteria to add an additional tie-breaker round, and therefore, reduce 
the need for the currently unpopular use of mandatory time-sharing; (2) 
eliminate the assignment and transfer ``holding period'' for LPFM 
licenses, clarify elements of the NCE ``holding period'' rule, and aid 
permittees and licensees by eliminating the current absolute bar on any 
section 307(b) preference-related service downgrade; (3) clarify that 
LPFM applicants dismissed due to unauthorized broadcasting operations 
cannot seek to reinstate the application by removing the board 
member(s) that have engaged in unauthorized broadcasting; (4) reduce 
challenges based on reasonable assurance of site availability; (5) toll 
NCE and LPFM broadcast construction deadlines without notification, for 
certain matters known to the agency, including when a permit is subject 
to international coordination or under administrative or judicial 
review; (6) provide at the outset a longer construction period for LPFM 
stations; and (7) permit the assignment and transfer of LPFM 
construction permits after 18 months. The Commission sought comment as 
to whether its goals of providing new NCE and LPFM service to the 
public, limiting speculation, and clarifying requirements could 
effectively be accomplished through these means, and the commenters 
supported the changes. The rules adopted herein are intended to 
minimize burdens on NCE and LPFM broadcasters, virtually all of whom 
are small businesses.
    58. Report to Congress. The Commission will send a copy of this 
R&O, including this FRFA, in a report to Congress and the Government 
Accountability Office pursuant to the Small Business Regulatory 
Enforcement Fairness Act of 1996. In addition, the Commission will send 
a copy of the R&O, including the FRFA, to the Chief Counsel for 
Advocacy of the Small Business Administration. A copy of the R&O and 
FRFA (or summaries thereof) will also be published in the Federal 
Register.
    59. Paperwork Reduction Act. The R&O contains new or modified 
information collection requirements subject to the Paperwork Reduction 
Act of 1995 (PRA), Public Law 104-13. The requirements will be 
submitted to the Office of Management and Budget (OMB) for review under 
section 3507(d) of the PRA. OMB, the general public, and other Federal 
agencies will be invited to comment on the new or modified information 
collection requirements contained in this proceeding. In addition, the 
Commission notes that pursuant to the Small Business Paperwork Relief 
Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), it 
previously sought specific comment on how it might further reduce the 
information collection burden for small business concerns with fewer 
than 25 employees.
    60. In this R&O, the Commission adopts new rules and licensing 
procedures for new NCE broadcast and LPFM stations. The Commission has 
assessed the effects of the new rules on small business concerns. It 
finds that the streamlined rules and procedures adopted here will 
minimize the information collection burden on affected applicants, 
permittees, and licensees, including small businesses.
    61. Congressional Review Act. The Commission has determined, and 
the Administrator of the Office of Information and Regulatory Affairs, 
Office of Management and Budget, concurs that this rule is ``non-
major'' under the Congressional Review Act, 5 U.S.C. 804(2). The 
Commission will send a copy of this R&O to Congress and the Government 
Accountability Office pursuant to 5 U.S.C. 801(a)(1)(A).

Ordering Clauses

    62. It is ordered that, pursuant to the authority contained in 
sections 1, 4(i), 4(j), 301, 303, 307, 308, 309, 316, and 319 of the 
Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i),154(j), 
301, 303, 307, 308, 309, 316, and 319, this R&O is adopted and will 
become effective 60 days after publication in the Federal Register.
    63. It is further ordered that part 73 of the Commission's Rules is 
amended and the rule changes to Sec. Sec.  73.854, 73.871(c), 
73.3572(b), 73.3573(a), and 73.3598 adopted herein will become 
effective 60 days after the date of publication in the Federal 
Register.
    64. It is further ordered that the rule changes to Sec. Sec.  
73.865, 73.872, 73.7002(c), 73.7003, and 73.7005, which contain new or 
modified information collection requirements that require approval by 
the Office of Management and Budget under the Paperwork Reduction Act, 
will become effective after the Commission publishes a document in the 
Federal Register announcing such approval and the relevant effective 
date.
    65. It is further ordered that, should no petitions for 
reconsideration or petitions for judicial review be timely filed, MB 
Docket No. 19-3 shall be terminated, and its docket closed.
    66. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of the R&O, including the Final Regulatory Flexibility 
Certification, to the Chief Counsel for Advocacy of the Small Business 
Administration.
    67. It is further ordered that the Commission shall send a copy of 
this R&O in a report to be sent to Congress and the Government 
Accountability Office pursuant to the Congressional Review Act, see 5 
U.S.C. 801(a)(1)(A).

List of Subjects in 47 CFR Part 73

    Cable television, Civil defense, Communications equipment, Defense 
communications, Education, Equal employment opportunity, Foreign 
relations, Mexico, Political candidates, Radio, Reporting and 
recordkeeping requirements, Satellites, Television.

Federal Communications Commission.
Marlene Dortch,
Secretary, Office of the Secretary.

Final Rules

    For the reasons set forth in the preamble, the Federal 
Communications Commission amends 47 CFR part 73 as follows:

[[Page 7889]]

PART 73--RADIO BROADCAST SERVICES

0
1. The authority citation for part 73 continues to read as follows:

    Authority: 47 U.S.C. 154, 155, 301, 303, 307, 309, 310, 334, 
336, 339.


0
2. Revise Sec.  73.854 to read as follows:


Sec.  73.854  Unlicensed radio operations.

    No application for an LPFM station may be granted unless the 
applicant certifies, under penalty of perjury, that neither the 
applicant, nor any party to the application, has engaged in any manner, 
including individually or with persons, groups, organizations, or other 
entities, in the unlicensed operation of any station in violation of 
Section 301 of the Communications Act of 1934, as amended, 47 U.S.C. 
301. If an application is dismissed pursuant to this section, the 
applicant is precluded from seeking nunc pro tunc reinstatement of the 
application and/or changing its directors to resolve the basic 
qualification issues.

0
3. Revise Sec.  73.865 to read as follows:


Sec.  73.865  Assignment and transfer of LPFM permits and licenses.

    (a) Assignment/transfer. No party may assign or transfer an LPFM 
permit or license if:
    (1) Consideration promised or received exceeds the legitimate and 
prudent expenses of the assignor or transferor. For purposes of this 
section, legitimate and prudent expenses are those expenses reasonably 
incurred by the assignor or transferor in obtaining and constructing 
the station (e.g., expenses in preparing an application, in obtaining 
and installing broadcast equipment to be assigned or transferred, 
etc.). Costs incurred in operating the station are not recoverable 
(e.g. rent, salaries, utilities, music licensing fees, etc.);
    (2) The assignee or transferee is incapable of satisfying all 
eligibility criteria that apply to a LPFM licensee; or
    (3) For a period of time commencing with the grant of any 
construction permit awarded based on the comparative point system, 
Sec.  73.872, and continuing until the station has achieved at least 
four years of on-air operations:
    (i)(A) The assignee or transferee cannot meet or exceed the points 
awarded to the initial applicant; or
    (B) Where the original LPFM construction permit was issued based on 
a point system tie-breaker, the assignee or transferee does not have a 
``locally established date,'' as defined in Sec.  73.853(b), that is 
the same as, or earlier than, the date of the most recently established 
local applicant in the tied mutually exclusive (MX) group.
    (ii) Any successive applicants proposing to assign or transfer the 
construction permit or license prior to the end of the aforementioned 
period will be required to make the same demonstrations. This 
restriction does not apply to construction permits that are awarded to 
non-mutually exclusive applicants or through settlement.
    (b) Name change. A change in the name of an LPFM permittee or 
licensee where no change in ownership or control is involved may be 
accomplished by written notification by the permittee or licensee to 
the Commission.
    (c) Holding period. A construction permit cannot be assigned or 
transferred for 18 months from the date of issue.
    (d) Board changes. Notwithstanding the other provisions in this 
section, transfers of control involving a sudden or gradual change of 
more than 50 percent of an LPFM's governing board are not prohibited, 
provided that the mission of the entity remains the same and the 
requirements of paragraph (a) of this section are satisfied. Sudden 
majority board changes shall be submitted as a pro forma ownership 
change within 30 days of the change or final event that caused the LPFM 
permittee or licensee to exceed the 50 percent threshold.

0
4. Amend Sec.  73.871 by revising paragraph (c)(3) to read as follows:


Sec.  73.871  Amendment of LPFM broadcast station applications.

* * * * *
    (c) * * *
    (3) Changes in ownership where the original party or parties to an 
application either:
    (i) Retain more than a 50 percent ownership interest in the 
application as originally filed;
    (ii) Retain an ownership interest of 50 percent or less as the 
result of governing board changes in a nonstock or membership applicant 
that occur over a period of six months or more; or
    (iii) Retain an ownership interest of 50 percent or less as the 
result of governing board changes in a nonstock or membership applicant 
that occur over a period of less than six months and there is no 
evidence of a takeover concern or a significant effect on such 
organization's mission. All changes in a governmental applicant are 
considered minor;
* * * * *

0
5. Amend Sec.  73.872 by revising paragraph (c) introductory text and 
adding paragraph (c)(5) to read as follows:


Sec.  73.872  Selection procedure for mutually exclusive LPFM 
applications.

* * * * *
    (c) Voluntary time-sharing. If mutually exclusive applications have 
the same point total, no more than three of the tied applicants may 
propose to share use of the frequency by electronically submitting, 
within 90 days of the release of a public notice announcing the tie, a 
time-share proposal. Such proposals shall be treated as minor 
amendments to the time-share proponents' applications and shall become 
part of the terms of the station authorization. Where such proposals 
include all of the tied applications, all of the tied applications will 
be treated as tentative selectees; otherwise, time-share proponents' 
points will be aggregated. Applicants may agree, at any time before the 
Media Bureau implements the involuntary time-share procedures pursuant 
to paragraph (d) of this section, to aggregate their points to enter 
into a time-share agreement. Applicants can only aggregate their points 
and submit a time-share agreement if each is designated a tentative 
selectee in the same mutually exclusive group, and if each applicant 
has the basic qualifications to receive a grant of its application.
* * * * *
    (5) In the event a tentatively accepted time-share agreement is 
dismissed, the Commission staff will release another public notice, 
initiating a second 90-day period for all remaining tentative selectees 
within the affected MX group to enter into either a voluntary time-
share arrangement or a universal settlement in accordance with 
paragraph (c) or (e) of this section. If the tie is not resolved in 
accordance with paragraph (c) or (e) of this section, the tied 
applications will be reviewed for acceptability, and applicants with 
tied, grantable applications will be eligible for involuntary time-
sharing in accordance with paragraph (d) of this section.
* * * * *

0
6. Amend Sec.  73.3572 by revising paragraph (b) to read as follows:


Sec.  73.3572  Processing TV broadcast, Class A TV broadcast, low power 
TV, TV translators, and TV booster applications.

* * * * *
    (b)(1) A new file number will be assigned to an application for a 
new station or for major changes in the facilities of an authorized 
station, when it is amended so as to effect a major

[[Page 7890]]

change, as defined in paragraph (a)(1) or (2) of this section, or 
result in a situation where the original party or parties to the 
application do not retain more than 50 percent ownership interest in 
the application as originally filed, and Sec.  73.3580 will apply to 
such amended application. However, such change in ownership is minor 
if:
    (i) The governing board change in a nonstock or membership 
noncommercial educational (NCE) full power television applicant 
occurred over a period of six months or longer; or
    (ii) The governing board change in a nonstock or membership NCE 
full power television applicant occurred over a period of less than six 
months and there is no evidence of a takeover concern or a significant 
effect on such organization's mission.
    (2) All changes in a governmental applicant are considered minor.
    (3) An application for change in the facilities of any existing 
station will continue to carry the same file number even though 
(pursuant to FCC approval) an assignment of license or transfer of 
control of such licensee or permittee has taken place if, upon 
consummation, the application is amended to reflect the new ownership.
* * * * *

0
7. Amend Sec.  73.3573 by revising paragraph (a)(1) introductory text 
to read as follows:


Sec.  73.3573  Processing FM broadcast station applications.

    (a) * * *
    (1) In the first group are applications for new stations or for 
major changes of authorized stations. A major change in ownership is 
one in which the original party or parties to the application do not 
retain more than 50 percent ownership interest in the application as 
originally filed, except that such change in ownership is minor if: The 
governing board change in a nonstock or membership NCE applicant 
occurred over a period of six months or longer or the governing board 
change in a nonstock or membership NCE applicant occurred over a period 
of less than six months and there is no evidence of a takeover concern 
or a significant effect on such organization's mission. All changes in 
a governmental applicant are considered minor. In the case of a Class D 
or an NCE FM reserved band channel station, a major facility change is 
any change in antenna location which would not continue to provide a 1 
mV/m service to some portion of its previously authorized 1 mV/m 
service area. In the case of a Class D station, a major facility change 
is any change in community of license or any change in frequency other 
than to a first-, second-, or third-adjacent channel. A major facility 
change for a commercial or a noncommercial educational full service FM 
station, a winning auction bidder, or a tentative selectee authorized 
or determined under this part is any change in frequency or community 
of license which is not in accord with its current assignment, except 
for the following:
* * * * *

0
8. Amend Sec.  73.3598 by:
0
a. Revising paragraph (a) introductory text;
0
b. Removing the word ``or'' at the end of paragraph (b)(2);
0
c. Removing the period at the end of paragraph (b)(3) and adding a 
semicolon in its place;
0
d. Adding paragraphs (b)(4) and (5); and
0
e. Revising paragraphs (c) and (d).
    The revisions and additions read as follows:


Sec.  73.3598  Period of construction.

    (a) Except as provided in the last two sentences of this paragraph 
(a), each original construction permit for the construction of a new 
TV, AM, FM or International Broadcast; low power TV; low power FM; TV 
translator; TV booster; FM translator; or FM booster station, or to 
make changes in such existing stations, shall specify a period of three 
years from the date of issuance of the original construction permit 
within which construction shall be completed and application for 
license filed. An eligible entity that acquires an issued and 
outstanding construction permit for a station in any of the services 
listed in this paragraph (a) shall have the time remaining on the 
construction permit or eighteen months from the consummation of the 
assignment or transfer of control, whichever is longer, within which to 
complete construction and file an application for license. For purposes 
of the preceding sentence, an ``eligible entity'' shall include any 
entity that qualifies as a small business under the Small Business 
Administration's size standards for its industry grouping, as set forth 
in 13 CFR parts 121 through 201, at the time the transaction is 
approved by the FCC, and holds:
* * * * *
    (b) * * *
    (4) A request for international coordination, with respect to a 
construction permit for stations in the Low Power FM service, on FM 
channels reserved for noncommercial educational use, and for 
noncommercial educational full power television stations, has been sent 
to Canada or Mexico on behalf of the station and no response from the 
country affected has been received; or
    (5) Failure of a Commission-imposed condition precedent prior to 
commencement of operation.
    (c) A permittee must notify the Commission as promptly as possible 
and, in any event, within 30 days, of any pertinent event covered by 
paragraph (b) of this section, and provide supporting documentation. 
All notifications must be filed in triplicate with the Secretary and 
must be placed in the station's local public file. For authorizations 
to construct stations in the Low Power FM service, on FM channels 
reserved for noncommercial educational use, and for noncommercial 
educational full power television stations, the Commission will 
identify and grant an initial period of tolling when the grant of a 
construction permit is encumbered by administrative or judicial review 
under the Commission's direct purview (e.g., petitions for 
reconsideration and applications for review of the grant of a 
construction permit pending before the Commission and any judicial 
appeal of any Commission action thereon), a request for international 
coordination under paragraph (b)(4) of this section, or failure of a 
condition under paragraph (b)(5) of this section. When a permit is 
encumbered by administrative or judicial review outside of the 
Commission's direct purview (e.g., local, state, or non-FCC Federal 
requirements), the permittee is required to notify the Commission of 
such tolling events.
    (d) A permittee must notify the Commission promptly when a relevant 
administrative or judicial review is resolved. Tolling resulting from 
an act of God will automatically cease six months from the date of the 
notification described in paragraph (c) of this section, unless the 
permittee submits additional notifications at six-month intervals 
detailing how the act of God continues to cause delays in construction, 
any construction progress, and the steps it has taken and proposes to 
take to resolve any remaining impediments. For authorizations to 
construct stations in the Low Power FM service, on FM channels reserved 
for noncommercial educational use, and for noncommercial educational 
full power television stations, the Commission will cease the tolling 
treatment and notify the permittee upon resolution of either:
    (1) Any encumbrance by administrative or judicial review of the 
grant of the construction permit under the Commission's direct purview;

[[Page 7891]]

    (2) The request for international coordination under paragraph 
(b)(4) of this section; or
    (3) The condition on the commencement of operations under paragraph 
(b)(5) of this section.
* * * * *

0
9. Amend Sec.  73.7002 by revising paragraph (c) to read as follows:


Sec.  73.7002  Fair distribution of service on reserved band FM 
channels.

* * * * *
    (c)(1) For a period of four years of on-air operations, an 
applicant receiving a decisive preference pursuant to this section is 
required to construct and operate technical facilities substantially as 
proposed. During this period, such applicant may make minor 
modifications to its authorized facilities, provided that either:
    (i) The modification does not downgrade service to the area on 
which the preference was based; or
    (ii) Any potential loss of first and second NCE service is offset 
by at least equal first and, separately, combined first and second NCE 
service population gain(s), and the applicant would continue to qualify 
for a decisive Section 307(b) preference.
    (2) Additionally, for a period beginning from the award of a 
construction permit through four years of on-air operations, a Tribal 
Applicant receiving a decisive preference pursuant to this section may 
not:
    (i) Assign or transfer the authorization except to another party 
that qualifies as a Tribal Applicant;
    (ii) Change the facility's community of license; or
    (iii) Effect a technical change that would cause the facility to 
provide less than full Tribal Coverage.

0
10. Amend Sec.  73.7003 by:
0
a. Revising paragraphs (b)(1) and (2);
0
b. Adding a heading for paragraph (c)(1);
0
c. In paragraph (c)(2):
0
i. Adding a heading; and
0
ii. Removing the semicolon at the end of the paragraph and adding a 
period in its place;
0
d. Revising paragraph (c)(3); and
0
e. Adding paragraphs (c)(4) and (5).
    The revisions and additions read as follows:


Sec.  73.7003  Point system selection procedures.

* * * * *
    (b) * * *
    (1) Established local applicant. Three points for local applicants, 
as defined in Sec.  73.7000, who have been local continuously for no 
fewer than the two years (24 months) immediately prior to the 
application filing.
    (2) Local diversity of ownership. Two points for applicants with no 
attributable interests, as defined in Sec.  73.7000, in any other 
broadcast station or authorized construction permit (comparing radio to 
radio and television to television) whose principal community (city 
grade) contour overlaps that of the proposed station. The principal 
community (city grade) contour is the 5 mV/m for AM stations, the 3.16 
mV/m for FM stations calculated in accordance with Sec.  73.313(c), and 
the contour identified in Sec.  73.685(a) for TV. Radio applicants will 
count commercial and noncommercial AM, FM, and FM translator stations 
other than fill-in stations. Television applicants will count UHF, VHF, 
and Class A stations.
* * * * *
    (c) * * *
    (1) Tie breaker 1. * * *
    (2) Tie breaker 2. * * *
    (3) Tie breaker 3. If a tie remains after the tie breaker in 
paragraph (c)(2) of this section, the tentative selectee will be the 
remaining applicant that can demonstrate that:
    (i) It applied in a previous filing window, and had its application 
accepted for filing and processed, but subsequently dismissed in favor 
of an applicant with superior points or a tie-breaker showing;
    (ii) It has been in continuous existence at all times from the date 
of that previous filing until the present; and
    (iii) It does not hold any NCE construction permit or license.
    (4) Voluntary time-sharing. If a tie remains after the tie breaker 
in paragraph (c)(3) of this section, each of the remaining tied, 
mutually exclusive applicants will be identified as a tentative 
selectee and must electronically submit, within 90-days from the 
release of the public notice or order announcing the remaining tie, any 
voluntary time-share agreement. Voluntary time-share agreements must be 
in writing, signed by each time-share proponent, and specify the 
proposed hours of operation of each time-share proponent.
    (5) Mandatory time-sharing. If a tie among mutually exclusive 
applications is not resolved through voluntary time-sharing in 
accordance with paragraph (c)(4) of this section, the tied applications 
will be reviewed for acceptability. Applicants with tied, grantable 
applications will be eligible for equal, concurrent, non-renewable 
license terms.
    (i) If a mutually exclusive group has three or fewer tied, 
grantable applications, the Commission will simultaneously grant these 
applications, assigning an equal number of hours per week to each 
applicant. The Commission will require each applicant subject to 
mandatory time-sharing to simultaneously and confidentially submit 
their preferred time slots to the Commission. If there are only two 
tied, grantable applications, the applicants must select between the 
following 12-hour time slots: 3 a.m.-2:59 p.m., or 3 p.m.-2:59 a.m. If 
there are three tied, grantable applications, each applicant must rank 
their preference for the following 8-hour time slots: 2 a.m.-9:59 a.m., 
10 a.m.-5:59 p.m., and 6 p.m.-1:59 a.m. The Commission will require the 
applicants to certify that they did not collude with any other 
applicants in the selection of time slots. The Commission will give 
preference to the applicant that has been local, as defined in Sec.  
73.7000, for the longest uninterrupted period of time. In the event an 
applicant neglects to designate its preferred time slots, staff will 
select a time slot for that applicant.
    (ii) Groups of more than three tied, grantable applications will 
not be eligible for licensing under this section. Where such groups 
exist, the Commission will dismiss all but the applications of the 
three applicants that have been local, as defined in Sec.  73.7000, for 
the longest uninterrupted periods of time. The Commission will then 
process the remaining applications as set forth in paragraph (c)(4)(i) 
of this section.
* * * * *

0
11. Amend Sec.  73.7005 by:
0
a. Revising the section heading and paragraph (b);
0
b. Redesignating paragraph (c) as paragraph (d);
0
c. Adding new paragraph (c); and
0
d. Adding a heading for newly redesignated paragraph (d)
    The revision and addition read as follows:


Sec.  73.7005  Maintenance of comparative qualifications.

* * * * *
    (b) Technical. In accordance with the provisions of Sec.  73.7002, 
for a period of four years of on-air operations, an NCE FM applicant 
receiving a decisive preference for fair distribution of service is 
required to construct and operate technical facilities substantially as 
proposed. During this period, such applicant may make minor 
modifications to its authorized facilities, provided that either:
    (1) The modification does not downgrade service to the area on 
which the preference was based; or
    (2) Any potential loss of first and second NCE service is offset by 
at least

[[Page 7892]]

equal first and, separately, combined first and second NCE service 
population gain(s).
    (c) Point system criteria. Any applicant selected based on the 
point system (Sec.  73.7003) must maintain the characteristics for 
which it received points for a period of time commencing with the grant 
of the construction permit and continuing until the station has 
achieved at least four years of on-air operations. During this time, 
any applicant receiving points for diversity of ownership (Sec.  
73.7003(b)(2)) and selected through the point system, is prohibited 
from:
    (1) Acquiring any commercial or noncommercial AM, FM, or non-fill-
in FM translator station which would overlap the principal community 
(city grade) contour of its NCE FM station received through the award 
of diversity points;
    (2) Acquiring any UHF, VHF, or Class A television station which 
would overlap the principal community (city grade) contour of its NCE 
television station received through the award of diversity points;
    (3) Proposing any modification to its NCE FM station received 
through the award of diversity points which would create overlap of the 
principal community (city grade) contour of such station with any 
attributable authorized commercial or noncommercial AM, FM, or non-
fill-in FM translator station;
    (4) Proposing any modification to its NCE television station 
received through the award of diversity points which would create 
overlap of the principal community (city grade) contour of such station 
with any attributable authorized UHF, VHF, or Class A television 
station;
    (5) Proposing modifications to any attributable commercial or 
noncommercial AM, FM, or non-fill-in FM translator station which would 
create overlap with the principal community (city grade) contour of its 
NCE FM station received through the award of diversity points; and
    (6) Proposing modifications to any attributable UHF, VHF, or Class 
A television station which would create overlap with the principal 
community (city grade) contour of its NCE television station received 
through the award of diversity points. This restriction applies to the 
applicant itself, any parties to the application, and any party that 
acquires an attributable interest in the permittee or licensee during 
this time period.
    (d) Non-comparative permits. * * *

[FR Doc. 2020-01009 Filed 2-11-20; 8:45 am]
BILLING CODE 6712-01-P