Tech

Corruption At The FCC? TV Execs Donate To Dem Lawmaker, Get Million-Dollar Rule Exception

Giuseppe Macri
Tech Editor

A single television station has been granted a significant exception to the Federal Communications Commission’s upcoming broadcast spectrum overhaul — a station whose operators made joint campaign contributions to a key lawmaker with oversight authority over the FCC.

House Energy & Commerce Committee Ranking Democrat Henry Waxman — who oversees the FCC — received more than $12,000 in campaign contributions from three television executives in danger of losing broadcast rights after their company missed a crucial agency deadline. The company was subsequently granted the sole exception to the FCC’s rule.

“The timing of the campaign donations is very suspicious,” a source at the FCC familiar with the spectrum deliberations told The Daily Caller. “It appears that you can buy special favors from the FCC worth millions of dollars by giving money to Democrats.  Would the result have been the same if the company’s executives were Republican donors?  I doubt it.”

In May the FCC finalized plans to hold a spectrum incentive auction, the goal of which is to free up and transition broadcast television ultra-high frequency spectrum space over to the growing mobile broadband services market.

Starting sometime in mid-2015, TV broadcasters will have the opportunity to sell spectrum back to the commission, which will then re-sell it to wireless carriers. Broadcasters choosing not to sell will be repacked (or moved to different spectrum) in order to stay in business.

The central question facing broadcasters is who will be eligible for auction participation, and who will be eligible for repacking in the event they fail to sell their spectrum.

That decision will be left up to the commission based on three FCC broadcast power and classification distinctions — “Class A” and “Full-Power Stations,” which will be eligible for auction participation or repacking, and “Low-Power Stations,” which will be ineligible for auction participation.

Full-Power Stations cover large broadcast ranges and must meet certain public interest requirements. Low-Power Stations cover smaller, more-localized areas and are exempt from those requirements. Class A Stations are former Low-Power Stations that received full-power status by filing an application with the commission, and meeting the public interest protocols.

Class A and Full-Power Stations will either receive millions of dollars by selling their spectrum to the FCC or stay in the television business via new, repacked spectrum, whereas Low-Power Stations are not guaranteed spectrum after the auction — meaning if there’s no room left, they’ll be forced off the air.

That makes the distinction between Class A and Low-Power Stations worth, literally, millions of dollars more for the former.

The commission released its adopted incentive auction rules in June, which established a simple rule: All Low-Power Stations that failed to file applications to become Class A Stations by February 22, 2012 (the date the law authorizing the incentive auction was enacted) would be ineligible to participate in the auction, or be protected through repacking.

All except one –  a local station based in Los Angeles, which received a special exception to the rule.