INTRODUCTION AND SUMMARY
In the NPRM, the Commission proposes using auctions to decide among pending and future mutually-exclusive applications for new commercial AM, FM, TV, FM Translator, LPTV, and TV Translator stations. It also requests comment on whether to use auctions to resolve mutually-exclusive applications for modifications to existing broadcast facilities. The Commission states that it will not consider the question of competing applications for full-service noncommercial stations in this proceeding. Nevertheless, it proposes adhering to an auction process when one or more of the applicants for a station on a "commercial frequency" is a non-profit educational organization under Section 73.503 of the Commission’s rules or other non-profit entity. By the term "commercial frequency," the Commission appears to mean all AM frequencies, all FM frequencies outside of the reserved FM band (87.9 - 91.9 MHz), and all television channels other than those reserved for noncommercial educational use, even though applicants may establish noncommercial educational broadcast stations on all AM, FM and TV frequencies.
While NPR, NFCB and CPB take no position on the use of auctions to resolve mutually-exclusive applications solely among commercial applicants, they urge the Commission to reject the use of auctions in any case where one or more of the applicants is a public broadcaster. The implementation of a competitive bidding system under these circumstances flies in the face of both the law and sound public policy. First, the Balanced Budget Act of 1997 does not authorize the Commission to use auctions when an applicant seeks a license to construct and operate or modify a noncommercial educational broadcast station. Second, subjecting public radio stations to auctions would restrict the diversity of voices and viewpoints available on the public airwaves by effectively closing the entire AM and FM spectrum, except for the reserved FM band, to public radio stations, who lack the substantial resources necessary to compete in auctions. Third, the use of auctions would contradict long-standing Congressional and Commission support for public broadcasting, including precedent opposing the reclamation of Federal funds granted to public broadcasters through government fees.
When a public broadcaster is one of the mutually-exclusive applicants for a frequency outside of the reserved band, the Commission should implement a selection process which promotes universal public radio service, diversity and localism, and protects public broadcasters. Specifically, in the case of mutually-exclusive applications for full-service broadcast stations the Commission should consider a point system which prioritizes applications proposing (a) the first or second noncommercial broadcast service to a geographic area, (b) significant minority or female ownership, control or involvement, or programming which uniquely serves the interests of minorities or women, and/or (c) significant involvement of or service to the local community. For FM translator applications, the Commission should continue to use its existing priority system. Moreover, public radio stations should be able to replace displaced FM translators on a first-come, first-served basis. Finally, the Commission should prioritize the modification applications of public broadcasters already located outside of the reserved band.