[Federal Register Volume 77, Number 92 (Friday, May 11, 2012)]
[Rules and Regulations]
[Pages 27631-27657]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-11065]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 73
[MM Docket No. 00-168, 00-44; FCC 12-44]
Standardized and Enhanced Disclosure Requirements for Television
Broadcast Licensee Public Interest Obligations; Extension of the Filing
Requirement for Children's Television Programming Report (FCC Form 398)
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: In this document, the Commission revises its public file
regulations to require that television station public inspection files
be made available in an online public file to be hosted on the
Commission's Web site.
DATES: The rules in this document contain information collection
requirements that are not effective until approved by the Office of
Management and Budget (OMB). These rules will become effective 30 days
after the Commission publishes a document in the Federal Register
announcing OMB approval of those information collection requirements.
FOR FURTHER INFORMATION CONTACT: For additional information on this
proceeding, contact Holly Saurer, Holly.Saurer@fcc.gov of the Media
Bureau, Policy Division, (202) 418-2120. For additional information
concerning the Paperwork Reduction Act information collection
requirements contained in this document, send an email to PRA@fcc.gov
or contact Cathy Williams at (202) 418-2918.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Second
Report and Order, FCC 12-44, adopted and released on April 27, 2012.
The full text of this document is available for public inspection and
copying during regular business hours in the FCC Reference Center,
Federal Communications Commission, 445 12th Street SW., CY-A257,
Washington, DC 20554. This document will also be available via ECFS
(http://www.fcc.gov/cgb/ecfs/). (Documents will be available
electronically in ASCII, Word 97, and/or Adobe Acrobat.) The complete
text may be purchased from the Commission's copy contractor, 445 12th
Street SW., Room CY-B402, Washington, DC 20554. To request this
document in accessible formats (computer diskettes, large print, audio
recording, and Braille), send an email to fcc504@fcc.gov or call the
Commission's Consumer and Governmental Affairs Bureau at (202) 418-0530
(voice), (202) 418-0432 (TTY).
The Commission will seek written comments on the Paperwork
Reduction Act (PRA) modified information collection requirements in a
separate notice that will be published in the Federal Register.
Paperwork Reduction Act of 1995 Analysis
This document contains modified information collection
requirements. The Commission, as part of its continuing effort to
reduce paperwork burdens, will invite the general public to comment on
the information collection requirements contained in this Second Report
and Order as required by the Paperwork Reduction Act of 1995, Public
Law 104-13 in a separate notice to be published in the Federal
Register. 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), we previously sought specific comment on how the
Commission might further reduce the information collection burden for
small business concerns with fewer than 25 employees. We received one
comment specifically addressing this issue. In the present document, we
have assessed the effects of the new requirements on small businesses,
including those with fewer than 25 employees, in the Final Regulatory
Flexibility Analysis (``FRFA'') below.
Summary of the Second Report and Order
I. Introduction
1. In this Second Report and Order we modernize the procedures
television broadcasters use to inform the public about how they are
serving their
[[Page 27632]]
communities, by having stations post their public files online in a
central, Commission-hosted database, rather than maintaining the files
locally at their main studios. This updating of our rules harnesses
current technology to make information concerning broadcast service
more accessible to the public and, over time, reduce broadcasters'
costs of compliance. This Order is another step in our modernization of
the Commission's processes to transition from paper filings and
recordkeeping to digital technology. Without imposing any new reporting
obligation, it will help bring broadcast disclosure into the 21st
century.
2. Specifically, we adopt--with significant modifications--the
proposal discussed in the Further Notice of Proposed Rulemaking
(``FNPRM'') to replace the decades-old requirement that commercial and
noncommercial television stations maintain a public file at their main
studios with a requirement to post most of the documents in that file
to an online public file to be hosted by the Commission. All permittees
and licensees of a TV or Class A TV station in the commercial and
noncommercial educational broadcast services must maintain a public
inspection file. We have departed from the proposal in a number of
respects to maximize public benefits while avoiding compliance costs
that the record suggests would not be justified at this time. First,
because many stations' existing political files are large, and the
retention period for the political file is shorter than for other
portions of the public file, we will not require stations to incur the
cost of upload their existing political files to the online public
file. Rather, stations may upload documents in that portion of the
public file only prospectively. Second, broadcasters will be
responsible for uploading only those items now required to be in the
public file but not otherwise filed with the Commission or available on
the Commission's Web site. In particular, the Commission will itself
import to the online public file any document or information now
required to be kept in the public file and that must already be filed
with the Commission electronically in the Consolidated DataBase System
(``CDBS''), so that stations do not need to post that information.
Third, we do not adopt new disclosure obligations for sponsorship
identifications and shared services agreements at this time, as had
been proposed in the FNPRM. Rather, broadcasters will only be required
to place in their online files material that is already required to be
placed in their local files. Fourth, we do not impose specific
formatting requirements on broadcasters at this time, although stations
should upload relevant documents either in their existing electronic
format or in a simple, easily created electronic format such as .pdf.
Finally, we will provide an organized file system for uploading
documents so that the resulting public file for each station is
orderly, and organizationally similar for all stations, thus promoting
ease of use by stations and the public.
3. To better ensure that the Commission can accommodate television
broadcasters' online filings and to limit any unforeseen start-up
difficulties to those stations that are best able to address them, we
will phase in the new posting requirements. For the next two years we
will only require stations that are affiliated with the top four
national networks (ABC, NBC, CBS and Fox) and that are licensed to
serve communities in the top 50 Designated Market Areas (``DMAs'') to
post political file documents online. We exempt all other stations from
posting their political file documents to their online public file
until July 1, 2014. The Media Bureau will issue a Public Notice no
later than July 1, 2013 to seek comment on the impact of this posting
requirement, to enable us to consider whether any changes should be
made before it takes effect for the other stations. We also defer
considering whether to adopt online posting for radio licensees and
multichannel video programming distributors until we have gained
experience with online posting of public files of television
broadcasters.
II. Background
4. One of a television broadcaster's fundamental public interest
obligations is to air programming responsive to the needs and interests
of its community of license. Rather than dictating how broadcasters
must meet that obligation, the Commission affords broadcasters broad
latitude, subject to a reporting requirement under which broadcasters
must maintain a public inspection file that gives the public access to
information about the station's operations.
5. Almost seventy-five years ago--in 1938--the Commission
promulgated its first political file rule. That initial rule was
essentially identical to our current political file regulation in its
requirements that the file be available for ``public inspection'' and
include both candidate requests for time and the disposition of those
requests, including the ``charges made'' for the broadcast time. More
than 45 years ago--in 1965--the Commission additionally adopted a
broader public inspection file rule. The public file requirement grew
out of Congress' 1960 amendment of Sections 309 and 311 of the
Communications Act of 1934 (the ``Act''), which allowed greater public
participation in broadcast licensing. Finding that Congress, in
enacting these provisions, was guarding ``the right of the general
public to be informed, not merely the rights of those who have special
interests,'' the Commission adopted the public inspection file
requirement to ``make information to which the public already has a
right more readily available, so that the public will be encouraged to
play a more active part in dialogue with broadcast licensees.''
6. In October 2000, in the first Notice of Proposed Rulemaking
issued in this proceeding, the Commission concluded that ``making
information regarding how a television broadcast station serves the
public interest easier to understand and more accessible will not only
promote discussion between the licensee and its community, but will
lessen the need for government involvement in ensuring that a station
is meeting its public interest obligation.'' The Commission tentatively
concluded that it should require television licensees to make the
contents of their public inspection files, including a standardized
form reflecting the stations' public interest programming, available on
their stations' Web sites or, alternatively, on the Web site of their
state broadcasters association. In 2007, the Commission adopted a
Report and Order implementing these proposals.
7. Following the release of the 2007 Report and Order, the
Commission received petitions for reconsideration from several industry
petitioners and public interest advocates. The industry petitioners
raised a number of issues, generally contending that the requirements
were overly complex and burdensome. Public interest advocates argued
that the political file should be included in the online public file
requirement rather than exempted as provided in the 2007 Report and
Order. In addition, five parties appealed the 2007 Report and Order,
and the cases were consolidated in the United States Court of Appeals
for the District of Columbia Circuit. The court granted a petition to
hold the proceeding in abeyance while the Commission reviewed the
petitions for reconsideration. Challenging the rules in a third forum,
several parties opposed the 2007 Report and Order's ``information
collection'' under the Paperwork Reduction Act.\1\
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\1\ The Paperwork Reduction Act of 1995, Pub. L. 104-13,
requires that the Office of Management and Budget (``OMB'') approve
any information collections. As required, the Commission published a
notice in the Federal Register seeking comment on the projected
burdens of the rules. See 73 FR 13462 (Mar. 13, 2008); 73 FR 30316
(May 27, 2008). Because of pending petitions for reconsideration
requesting substantial revisions to the 2007 Report and Order that
would affect the projected burdens, the Commission did not formally
transmit the information collection to OMB for its approval,
choosing instead to address the petitions for reconsideration, and
therefore the rules adopted in the 2007 Report and Order never went
into effect.
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[[Page 27633]]
8. In June 2011, Commission staff released ``The Information Needs
of Communities'' Report (``INC Report''), a comprehensive report on the
current state of the media landscape created by a working group
including Commission staff, scholars, and consultants. The INC Report
discussed both the need to empower citizens to ensure that broadcasters
serve their communities in exchange for the use of public spectrum, and
the need to remove unnecessary burdens on broadcasters who aim to serve
their communities. The INC Report recommended an online system for
public inspection files in order to ensure greater public access. It
also recommended that stations be required to disclose online shared
services agreements and ``pay-for-play'' arrangements. The INC Report
further suggested that governments at all levels collect and publish
data in forms that make it easy for citizens, entrepreneurs, software
developers, and reporters to access and analyze information to enable
them to present the data in more useful formats, and noted that greater
transparency by government and media companies can help reduce the cost
of reporting, empower consumers, and foster innovation.
9. In October 2011, the Commission vacated the 2007 Report and
Order, determining that technological and marketplace changes since
2007 may be pertinent to our consideration of television broadcasters'
public disclosure obligations, and that the best course of action would
be to take a fresh look at the policy issues raised in this proceeding.
The Commission also adopted an FNPRM to refresh the record in this
proceeding. It solicited comment on various proposals, including some
of the proposals parties raised on reconsideration, to improve public
access to information about how broadcasters are serving their
communities while minimizing the burdens placed upon broadcasters.
III. Discussion
10. The updated rules we adopt today modernize disclosure
procedures to improve access to station files that, for decades, have
been public more in theory than in practice. Today, reviewing a
television station's public file typically involves the substantial
expense and inconvenience of traveling to the station and paying for
paper copies. Under our rules, review will involve a quick and
essentially costless Internet search. This modernization is plain
common sense. The evolution of the Internet and the spread of broadband
Internet access has made it easy for stations to post material online
and for many consumers to find information online. The television
broadcast industry should not be left out of the online revolution that
has improved the delivery of products and services across our economy,
as well as the availability of government services and government
information to the public.
11. At the same time, we are committed to updating the outdated
procedures for public access to television stations' public files in a
manner that avoids unnecessary burdens on broadcasters. We have
significantly departed from the proposals in the FNPRM to achieve this
goal. Based on this balance of considerations, the online public file
requirements we adopt today will replace the existing in-station
retention requirements as follows:
Each station's entire public file will be hosted online,
by the Commission.
Television broadcasters will be responsible for uploading
only those items now required to be in the public file but not
otherwise filed with the Commission or available on the Commission's
Web site. These items include citizen agreements, certain EEO
materials, issues/programs lists, children's television commercial
limits records, donor lists for NCEs, local public notice
announcements, time brokerage agreements, must-carry or retransmission
consent elections, joint sales agreements, Class A continuing
eligibility documentation, materials related to FCC investigations
(other than investigative information requests from the Commission),
and any new political file materials.
Any document or information now required to be kept in a
television station's public file and that must already be filed with
the Commission electronically in the Consolidated DataBase System
(``CDBS'') will be imported to the online public file and updated by
the Commission. This includes authorizations, applications and related
materials, contour maps, ownership reports and related materials, EEO
materials, The Public and Broadcasting manual, children's television
programming reports, and Letters of Inquiry and other investigative
information requests from the Commission, unless otherwise directed by
the inquiry itself.
Television stations will not be required to upload their
existing political files to the online file; rather, they will be
permitted to maintain at the station those documents placed in their
political file before the effective date of our rules, and only upload
documents to the online political file on a going-forward basis.
To smooth the transition for both stations and the
Commission and to allow smaller broadcasters additional time to begin
posting their political files online, we will exempt all stations that
are not in the top 50 DMAs and all stations not affiliated with the top
four national television broadcast networks, regardless of the size of
the market they serve, from having to post new political file materials
online until July 1, 2014.
Stations will not be required to upload letters and emails
from the public to their online public file; rather, they will continue
to maintain them in a correspondence file at the main studio.
Stations will not be required to include in their online
public file any documents not already required to be included in their
local file.
We believe these procedures will substantially advance the original
goals of the public file requirements and better enable the public to
engage with their local broadcasters. Further, while broadcasters will
incur a modest, one-time transitional cost to upload some portions of
their existing public file to the Commission's online database, that
initial expense will be offset by the public benefits of online
disclosure. Over time, moreover, broadcasters will benefit from the
lower costs of sending documents electronically to the Commission, as
opposed to creating and maintaining a paper file at the station.
A. A Commission-Hosted Online Public File Will Serve the Public
Interest
12. We agree with commenters who maintain that placing the public
file online will improve the public's access to information and
facilitate dialogue between broadcast stations and the communities they
serve. As the Commission noted in the FNPRM, making public file
information available through the Internet should facilitate public
access and foster increased public participation in the licensing
process. The information provided in the public file is beneficial to
persons who wish to participate in a station's license renewal
proceeding. For example, as the Public Interest, Public
[[Page 27634]]
Airwaves Coalition (``PIPAC'') notes, when broadcasters fall short of
their obligations or violate Commission rules, the public's ability to
alert the Commission by filing complaints or petitions to deny the
renewal of a station's broadcast license is essential, and the public
file provides information necessary to file such complaints or
petitions.
13. We also agree with commenters that access to the public files
has been inconveniently (and unnecessarily) limited by current
procedures. Currently, the public can access a station's public files
only by visiting the main studio during regular business hours. Several
commenters discussed the inconvenience of this limited access and
identified problems they experienced in attempting to access stations'
public files. Making the information available online will permit 24-
hour access from any location, without requiring a visit to the
station, thereby greatly increasing public access to information on how
a station is meeting its public interest obligations. The Internet is
an effective and low-cost method of maintaining contact with, and
distributing information to, broadcast viewers. Indeed, given the
considerable flexibility that stations have in locating their main
studios and the fact that many members of a station's audience may be
working during ``normal business hours''--the only time stations are
obliged to make the file available--there seems little doubt that 24-
hour Internet access would greatly improve the accessibility of these
files. The public benefits of posting this information online, while
difficult to quantify with exactitude, are unquestionably substantial.
14. We further conclude that it will be efficient for the public
and ultimately less burdensome for stations to have their public files
available in a centralized location. The Commission will, therefore,
host the online public file. A Commission-hosted online public file
will allow consumers to easily find the public files of all stations in
their viewing area, making the Commission's Web site a one-stop shop
for information about all broadcast television stations in a viewer's
market and eliminating the need to access multiple stations' Web sites.
As we further discuss below, a uniform organizational structure among
all files will allow consumers to more easily navigate the public files
of all stations of interest. The public will be able to review the
online public file of any station, and quickly navigate to where each
category of documents is found, because each station's online public
file will be organized in the same format.
15. The Commission's hosting of the public file also addresses
concerns expressed by many broadcasters about the burden of hosting
files online themselves. The rules adopted in 2007 would have required
stations to host their public files on their own Web sites. In
petitions for reconsideration, two broadcast trade associations
proposed that the Commission host the files instead, suggesting that
such a solution would be less burdensome to licensees, who would not
have to devote resources to creating and maintaining an online public
file. They also contended this approach would be more efficient, since
many public file items are already filed with the Commission. For
instance, the Named State Broadcasters Associations estimated that the
Commission's hosting of the files would save broadcasters more than $24
million in first-year costs, and almost $14 million in annual costs
thereafter. We agree that having the Commission host stations' public
file information will ultimately reduce costs for stations--compared to
the existing local file requirements.
16. We agree with commenters who reject the argument that there is
no public need that can be met by placing online the political file
portion of the station's public inspection file. As noted by
commenters, placing the political file online will enable candidates,
as well as the public, journalists, educators, and the research
community, to identify and investigate those sponsoring political
advertisements. Under current rules, the political file must contain,
among other things, all specific requests for broadcast time made by or
on behalf of a candidate and the disposition of those requests. It must
also contain information regarding other appearances by candidates
(excluding those in certain news programming exempt from the equal
opportunities provision), and information about issue advertising that
``communicates a message relating to any political matter of national
importance.'' As noted by some commenters, political ad spending is
rapidly increasing, and often the only way to track such expenditures
is through stations' political files. We also agree with PIPAC's
assertion that the disclosures included in the political file further
the First Amendment's goal of an informed electorate that is able to
evaluate the validity of messages and hold accountable the interests
that disseminate political advocacy. As the Supreme Court stated in
Citizens United v. FEC, ``transparency enables the electorate to make
informed decisions and give proper weight to different speakers and
messages'' and that, ``[w]ith the advent of the Internet, prompt
disclosure of expenditures can provide shareholders and citizens with
the information needed to hold corporations and elected officials
accountable for their positions and supporters.'' We are also persuaded
by commenters claiming that ``the public must have access to
information about the messenger as well as the message to fully
understand an ad's content.''
17. Campaigns and candidates will be among those who benefit from
being able to obtain political file information online. Some industry
comments argue that candidates will obtain only limited benefits and
possibly experience detrimental effects from moving the political file
online. Broadcasters argue that the existing process serves the
candidates and the stations well, and there is no reason to believe
that changing the process will benefit candidates or campaigns. Other
broadcasters argue that it is more meaningful and efficient for a
candidate's representatives to speak with a station's sales department
on the phone or in person. According to these broadcasters, personal
interactions would be lost if the political file were to be placed
online, which would be frustrating and create inefficiencies for
advertising buyers and station staff. We fail to see how the online
availability of past political time purchases will discourage buyers
from having contact with the station concerning current and future time
buys or how this information's availability will interfere with ongoing
relationships between the stations and buyers. The fact that buyers and
candidates will have increased ease of access to relevant information
should not preclude or hinder candidates or buyers from a continuing
dialogue with stations as they purchase time. Although some stations
may elect to continue to make information routinely available to
candidates through personal interaction at the station during business
hours, which we do not intend to discourage, we expect that candidates
and their representatives will use the online political file to obtain
information from source documents without filtering by station
personnel and at any time of day. LUC Media, a candidate media buyer,
argues that ``the only way that candidates can make sure that they
receive the availabilities and prices that the law requires is to have
access to stations' and cable television systems' political files.''
LUC Media claims that the political file is necessary because
``stations and cable television
[[Page 27635]]
systems have learned over the years that, if they can limit the
information that candidates have about availabilities and rates, they
can get candidates to overpay for the airtime that they buy.'' While
LUC Media notes that this is not the practice of all stations, LUC
Media routinely reviews stations' political files to ensure that they
are providing candidates with equal opportunities, which is why ``the
Commission requires that this information be available for public
inspection.'' LUC argues that ``Internet access to those files will
enable more candidates to become better informed about availabilities
and pricing and, thus, demand that they receive the lowest unit charge
for the time that they buy.'' Internet access will also eliminate the
need for such buyers to travel to every station in a market to verify
the contents of the public file, and to ask for help from station
employees who have to take time away from their normal duties to
accommodate such requests. We agree with LUC Media that placing the
political file online will enhance the underlying purpose of the
political file.
18. Some broadcasters argue that the Commission's focus in this
proceeding has inappropriately changed from increasing broadcast
dialogue with the public to enabling access to information about the
stations for research and public advocacy groups with no ties to the
broadcast stations' communities. We do not perceive the dichotomy these
broadcasters suggest. While the public file is first and foremost a
tool for community members, it is also a tool for the larger media
policy community. Public advocacy groups, journalists, and researchers
act in part as surrogates for the viewing public in evaluating and
reporting on broadcast stations' performance. And as we stated in the
FNPRM, easy access to public file information will assist the
Commission, Congress, and researchers as they fashion public policy and
recommendations relating to broadcasting and other media issues. For
example, the Commission has said that ``the quarterly issues/programs
lists will provide the public and the Commission with the information
needed to monitor licensees' performance under this new regulatory
scheme and thus permit us to evaluate the impact of our decision.
Existing procedures such as citizen complaints and petitions to deny
will continue to function as important tools in this regard.'' Academic
analysis of such lists help the Commission monitor whether stations are
meeting their responsibilities to their local community, and can
provide information relevant to citizen complaints and petitions to
deny. We recognize the efforts of public interest groups and academics
to analyze publicly available information and educate the public about
how their local stations are serving their communities, and believe
that this work is an important aspect of educating viewers about their
local television broadcast stations.
B. Broadcasters' Initial Costs To Comply Will Be Minimized and the
Online Public File Will Ultimately Lead to Cost Savings
1. We Are Tailoring the Requirements To Minimize Costs of Moving the
Public Files Online
19. We have adopted a variety of measures to minimize the efforts
broadcasters must undertake to move their public files online. In
addition, we have declined to adopt certain proposals in the FNPRM at
this time, to further ensure that the costs of compliance with the new
posting procedures are outweighed by the benefits of online disclosure.
20. First, we are minimizing burdens on stations by not requiring
them to upload documents that are currently part of the public file but
which are also filed in the Consolidated DataBase System (``CDBS'') or
that the Commission already maintains on its own Web site. The
Commission will import these documents into the online public file.
Documents that fall in this category include station authorizations,
applications and related materials, contour maps, ownership reports and
related materials, EEO materials, The Public and Broadcasting manual,
children's television programming reports, and Letters of Inquiry and
other investigative information requests from the Commission, unless
otherwise directed by the inquiry itself. Broadcasters will be
responsible for uploading only those items not otherwise filed with the
Commission or available on the Commission's Web site.
21. We recognize that stations' need to upload other items in the
public file--including citizen agreements, certain EEO materials,
issues/programs lists, children's television commercial limits records,
donor lists for NCEs, local public notice announcements, time brokerage
agreements, must-carry or retransmission consent elections, joint sales
agreements, Class A continuing eligibility documentation, materials
related to FCC investigations (other than investigative information
requests from the Commission), and new political file materials--will
entail some burden initially, inasmuch as stations will have to upload
electronic versions or scan and upload paper versions of existing
public files to the online public file. But not all stations will have
all of these documents. For example, a station may not have time
brokerage agreements, joint sales agreements, or citizen agreements,
and may not be a Class A station. In that situation, there will be
nothing in these categories for the station to upload. Moreover, many
of the items in the public file will not require frequent updating. An
LMA, for example, may have a term of 5 or more years and would not
require any further action on the part of the station unless the
agreement was amended or replaced. Joint sales agreements, citizen
agreements, retransmission and must-carry consent elections similarly
involve extended periods of time. In addition, as discussed below,
stations will not be required to upload any of their existing political
file documents. Rather, stations may upload documents to the political
file component of the online public file only prospectively. We
conclude that, for those public file items that stations do have to
post, the transitional costs would involve only a one-time burden on
broadcasters that, as further explained below, we find is outweighed by
the significant benefits of transitioning the public file online.
22. Second, we minimize burdens on broadcasters by declining to
adopt any new recordkeeping requirements. As discussed below, we are
not adopting the proposal in the FNPRM to require stations to include
sponsorship identification information in the online public files or to
include shared services agreements that are not already required to be
included in the local file. Instead, only information already required
to be included in the local file will need to be posted online.
23. Third, we are not requiring stations to post files online in a
particular format at this time. Thus, they will not need to undertake
the costs of developing new electronic forms or of conforming their
current recordkeeping practices to accommodate a Commission-designed
form.
2. Broadcast Commenters Greatly Overstate the Costs Involved
24. Based upon the actions we are taking to minimize burdens,
discussed above, and our analysis of some television stations' public
files, we conclude that the broadcast commenters vastly overstate the
burdens of moving their public files online.
25. The Commission is taking steps to ensure that the process of
uploading
[[Page 27636]]
files to the online public file--both initially and prospectively--will
be simple and efficient. We are developing the online public file
system to permit broadcasters simply to drag and drop documents into
the relevant folders of their online public file. As a result, although
the initial upload of existing documents--that is, those documents
maintained in the paper file before the effective date of our new
rules--will impose some costs on stations, we do not believe these
costs will be unduly burdensome, particularly compared to the resulting
benefits.
26. Some broadcasters argue that uploading the existing public file
will be unduly burdensome. They argue that we should implement the
online public file requirement solely on a forward-looking basis,
encompassing either all documents created after a certain date or all
documents created after a station's next renewal. Joint TV Broadcasters
notes that many materials must be retained until final action is taken
on a station's next license renewal application, and a decision
requiring all existing local files to be scanned and uploaded would
require stations to upload eight years of information that may soon be
obsolete. It argues that some of the materials, like the issues/
programs lists, commercial limit certifications, and the political
file, should be required to be uploaded to the online public file only
on a going-forward basis.
27. We find that the one-time electronic upload or scanning and
upload of existing documents is not unduly burdensome and that adoption
of a grandfathering approach would be confusing to those seeking access
to the information. Such an approach would necessitate the continued
maintenance of a robust local file, which could diminish the benefits
to the public of the online file with respect to improved public access
to information, and would diminish the benefits to the stations of
moving their files online. We agree with Common Frequency that scanning
existing paper documents does not constitute an extraordinary burden,
as it is a rote process that can be affordably outsourced if necessary.
In addition, if the documents are currently maintained in electronic
form, as some are likely to be, the one-time burden will be de minimis.
28. Our determination that the transition process will not be
unduly burdensome is based in part on a review, in March 2012, of the
public files of stations in the Baltimore DMA. Commenters provided
little data based on actual station records. The Commission therefore
determined that it was advisable to supplement the record with
empirical data from a sample market. Baltimore was selected because its
proximity to Commission headquarters in Washington, DC, and the
relatively compact size of the Baltimore DMA allowed staff to visit
stations there without great difficulty. Our review of the Baltimore
DMA public files indicates that most stations will only need to upload
a fraction of their existing public file to the online public file--or
approximately 250 to 2200 pages, as reflected in the second column of
the chart below. Columns three and four reflect what we believe the
costs are likely to be for stations to upload this information. We
estimate that stations that choose to scan and upload this information
in-house can do so for $.10 per page,\2\ while stations can outsource
such work for approximately $.50 per page. Based on this assumed cost
of $.10 to $.50 per page, we calculate a range of the average cost for
a station to upload their existing public file in accordance with this
Order, with the average cost per station ranging from approximately
$80-$400 per station. We believe that this modest one-time expenditure
(even if it were not offset by later costs savings as we believe it
will be) is worth the benefits of providing the public with access to a
station's existing public file.
---------------------------------------------------------------------------
\2\ Under the Freedom of Information Act, the Commission is
allowed to charge for our research and reproduction services under
certain conditions. See http://www.fcc.gov/guides/how-file-foia-request. We have determined those costs to be $.10 per page. See
Modification of the Freedom of Information Act Fee Schedule, D.A.
10-97 (Jan. 19, 2010). We believe this to be an accurate reflection
of actual reproduction costs, and we expect that scanning costs
would be equal to this or lower, because paper, ink, and fasteners
are not required.
----------------------------------------------------------------------------------------------------------------
Public file
pages to In-house cost Outsourced In-house
upload w/in per page 1 cost per page total Outsourced total
6 months 1
----------------------------------------------------------------------------------------------------------------
WBAL-TV.............................. 998 0.1 0.5 $99.80 $499.00
WMAR-TV.............................. 987 0 0 0.00 0.00
WJZ-TV............................... 844 0.1 0.5 84.40 422.00
WNUV................................. 251 0.1 0.5 25.10 125.50
WBFF................................. 2094 0.1 0.5 209.40 1,047
WUTB................................. 2126 0.1 0.5 212.60 1,063.00
WMPT................................. 2180 0 0 0.00 0.00
WMPB................................. 2180 0 0 0.00 0.00
--------------------------------------------------------------------------
Total............................ 11660 ............. ............. 631.30 3,156.50
----------------------------------------------------------------------------------------------------------------
29. We agree with commenters that, once they incur these modest
costs, stations will realize savings by no longer having to keep a
local file on a going-forward basis. We recognize that stations will be
required to maintain and make publicly available a correspondence file
with letters and emails from the public, but we agree with commenters
that stations will nonetheless realize significant reductions in
burdens by not having to maintain a more robust local file. Placing the
information online will minimize disruptions in the daily operation of
a station, and reduce the burdens placed on station staff that
currently field phone calls and chaperone in-person requests to inspect
the files.\3\ When Commission staff sought to obtain the public files
of the Baltimore stations, as well as those of five other stations
around the country, stations dedicated staff resources to
[[Page 27637]]
copying the files, and were in no case able to provide the copies on
the same day as the request. Further, once broadcasters have completed
the initial upload of documents in the existing public files, as
specified herein, we do not believe that uploading public file
documents on a going-forward basis to an online public file is likely
to be any more burdensome than placing such documents into a paper
file. Indeed, in many instances, using the online public file will be
less burdensome, because uploading (or even scanning, then uploading) a
file may be easier and more efficient than photocopying it, walking it
to the local paper file, finding the appropriate folder and inserting
it in the proper order.
---------------------------------------------------------------------------
\3\ Our current rules do not require stations to accommodate
political file requests over the phone, because such a requirement
could disrupt station operations. We expect that requiring stations
to place the public files online will have a similar beneficial
effect; reducing rather than expanding, disruptions to operations at
the station as station personnel would no longer have to process
requests for access to this information in person, as they are
currently required to do. Instead of accommodating each candidate or
their campaign representatives personally on a frequent basis, an
online requirement will allow a station to upload the most up-to-
date information periodically for all interested parties. As
discussed below, however, we are requiring stations to maintain a
back-up of the political file for use in the event the Commission's
database becomes unavailable or disabled.
---------------------------------------------------------------------------
30. The industry's arguments regarding the costs involved with
uploading documents to the online public file focus on the political
file, which they identify as the most active element of the public
file. NAB states that two stations have estimated that the time
involved in completing political ad buys will ``essentially double'' in
an online environment, at a cost of $80,000 per station. Joint
Broadcasters estimates that ``creating electronic versions of all
political time requests'' and uploading such documents will take one
half hour per record, which would amount to almost 16 hours per week
per station during the political season, compared to the 2.5 hours a
week that stations spend under the current paper filing system. We find
unpersuasive the argument that the time required to assemble the online
political file will double or quadruple. Instead of photocopying
documents and placing them in a paper public file, stations will upload
to the online public file documents already stored in electronic format
or scan paper documents (a process akin to photocopying) and upload the
electronic versions. One commenter notes that not all stations own a
scanner, or a scanner of sufficient quality to make copies of documents
adequate for uploading to the Commission's online public file. For
stations that do not wish to make this minor investment, other business
solutions are available, including creating documents electronically or
outsourcing the scanning functions. Scanning costs may be higher on a
per-page basis if outsourced, just as it would be more expensive per
page to outsource the copying and filing of paper copies. Given that
stations will be uploading fewer documents into the online public file
than they currently place in their paper files, we expect that station
costs going forward will be lower than under the existing requirements.
Given that the requirement to drag and drop the files into our online
public file will replace the requirement to photocopy and walk the
documents to the local file, we expect that fulfilling this requirement
will not take substantially more time and may take less time to
accomplish. Broadcasters provide no specific support for their facially
implausible assertion that creating electronic versions of political
file requests and uploading them would take a half hour. Moreover, they
fail to acknowledge that the time involved in uploading documents
electronically should decrease substantially with time as station
personnel become more accustomed to this process.\4\
---------------------------------------------------------------------------
\4\ As discussed further in Section III.C.1 below, stations are
required to ``keep and permit public inspection of a complete and
orderly record (political file) of all requests for broadcast time
made by or on behalf of a candidate for public office, together with
an appropriate notation showing the disposition made by the licensee
of such requests, and the charges made, if any, if the request is
granted.'' 47 CFR 73.1943. We note that political files that
Commission staff reviewed frequently contained more information than
is required by our rules. Stations that are concerned about the
burdensomeness of placing their political file online on a going-
forward basis may wish to review their political file retention
practices.
---------------------------------------------------------------------------
31. We also disagree with the commenter who projects that the
proposed online public file, and specifically the political file and
sponsorship identification requirements, will require each station to
hire one to three employees at an average cost of $30,000 to $140,000
per station per year. On the contrary, given that the requirement to
upload the files will replace rather than add to the existing file
requirements, we expect that stations will be able to assign these
responsibilities to existing staff, rather than hire additional staff.
We fail to see how this requirement could legitimately result in the
need to hire three additional staff members, even in the heat of an
election. Moreover, the commenters' estimated figures include the costs
of complying with the FNPRM's proposed new public file requirement for
sponsorship identification, which, as we discuss below, we are not
adopting. Further, to the extent these figures include costs associated
with the initial upload of the existing political file, they
overestimate the burden on broadcasters because we do not require the
existing political file to be uploaded.
32. We note that because the size of the political file appears to
roughly correlate with a station's political advertising revenues,
stations with little or no revenue will have little to no obligations
under these rules, and stations with larger numbers of pages to upload
will tend to have similarly large income associated with those pages.
In addition, although candidate advertising must be sold at the lowest
unit charge, issue advertisers are not entitled to reduced rates and
therefore pay market rates for advertising on broadcast stations. When
balanced against the revenues earned from political advertising--which
brought broadcasters an estimated $2.29 billion in 2010 and are
expected to bring in even more in 2012--the costs of complying with the
online posting requirement seem even less significant. Indeed,
political files reviewed by Commission staff, from markets across the
country, generally reflect that stations receive political advertising
revenues of thousands of dollars per page of political file that must
be uploaded. We also agree with commenters who note that ad buyers,
candidates, and the public must today undertake burdens to obtain
information about the political file, including traveling from station
to station to obtain political file information. Our collection of the
Baltimore DMA public files required, in total, dozens of person-hours,
driving back and forth to stations (first to request the copies and
then to collect them), and copying costs that were estimated at close
to $1,700 by the stations themselves. Our action today will
substantially reduce or eliminate each of those burdens.
C. Application of Online Posting Rule to Specific Public File
Components
1. Political File
33. We consider public access to stations' political files
particularly important. Therefore, we will adopt the proposal in the
FNPRM that political files be included in the online public file, but
will exempt all stations not in the top 50 DMAs, and all stations in
the top 50 DMAs that are not affiliated with the top four national
television broadcast networks, from posting their political file
documents online until July 1, 2014. Prior to this exemption expiring--
by July 1, 2013--the Media Bureau will issue a Public Notice seeking
comment on the impact of moving online the political files for these
200 stations, to enable us to consider whether any changes should be
made before the requirement takes effect for the other stations. In
addition, as discussed above, we will not require any stations to
upload their existing political file; rather, they will be required to
upload new political file content on a going-forward basis.
[[Page 27638]]
34. We believe circumstances have changed to warrant reaching a
different conclusion about posting the political file online than we
reached in the 2007 Report and Order. In the 2007 Report and Order, the
Commission excluded the political file from the requirement that
stations post their public files on their Web sites. The Commission
determined that the frequent requests for access by campaigns and the
need for stations to update the file frequently during an election
season made an online posting requirement inappropriate. The Commission
also reasoned that political campaigns generally have greater resources
than individual viewers and, therefore, access to the in-station
political file would tend to be less burdensome for campaign
organizations. Petitioners for reconsideration argued that such a
decision focused exclusively on the interests of the candidates and
broadcasters, and not on the public. In addition, as the Commission
noted in the FNPRM, television stations now handle many political
advertising transactions electronically, through emails and a variety
of software applications. As a result, requiring stations to make this
information publicly available online will impose far less of a burden
under current circumstances than under previous conditions. We thus
disagree with arguments that the Commission does not have a sufficient
basis to reverse the decision of the 2007 Report and Order to exclude
the political file from the online requirement. Our understanding of
how stations manage their political transactions and their traffic
systems, technological advances that have occurred since the 2007
Report and Order, and our decision to host and centralize the online
public file support our revised approach. Below, moreover, we respond
to specific arguments that we should exclude the political file from
the online public file.
35. Electronic Processes. Some industry commenters argue that our
understanding that stations now conduct political advertising
transactions electronically is incorrect. They argue that for some
candidates the purchasing process is not electronic, but done through a
variety of means, including phone, fax, and in person. For political ad
buys, the process can be multi-staged. They state that negotiations may
result in many entries into the political file before an agreement to
provide time is reached. After an agreement is reached, the actual
times the advertisement is aired can still change if the spot is
purchased on a preemptible basis. Advertising time sold on a
preemptible basis means that the advertising spot may be preempted by
another advertiser and re-scheduled for another time. In addition, NAB
states that national advertising sales representatives communicate with
the stations they represent using proprietary software that varies
among companies and may not include information about classes of time
or rates in the documents they generate, and therefore do not provide
sufficient information to fulfill the political file documentation
requirements. Thus, these parties argue, stations do not collect
information in a uniform manner, and the Commission cannot assume that
all of the information that must be in the public file will be included
on one form. NAB goes on to explain that billing systems commonly used
by stations generate a separate series of reports for each order.
During the political season, advertisers generally order time on a
weekly basis. A typical billing system will generate three documents
for the political file relating to each order--one report showing the
original order placed into the station's traffic system, another
showing the exact times that spots ran, and a third showing the final
charges paid by candidates for those spots. For each order, these
reports occupy three to ten printed pages, and for very active
advertisers, a weekly report may be much longer. Further, commenters
argue that computerized traffic management systems used to sell and
schedule television advertising time will not in any way facilitate
compliance with an online political file requirement, as there are many
different types of automated systems that collect, track, and process
information in different ways.
36. Notwithstanding these arguments, broadcasters' record
descriptions of how stations actually track advertising purchases and
manage the scheduling of such transactions confirms our understanding
that stations are capable of, and often do, include electronic
processes in their assembly of the political file. While we recognize
that there are still some portions of the sales process and political
file assembly that are not fully automated, and that some stations use
electronic means to a larger extent than others, our review of
Baltimore political files confirms that many of the records that would
be required to be in the public file originate as or are reduced to
electronic files and would thus be relatively easy to upload in a
universally readable format, such as .pdf. To the extent that a
required document is not automatically converted to electronic form by
the sales or invoice and reconciliation process, they can be easily
scanned and uploaded instead of photocopied and placed in the paper
file, as is the current practice.
37. Furthermore, we reject broadcasters' burden arguments that are
based on the fact that existing electronic traffic management systems
may not be programmed to allow stations to upload documents directly to
a database. According to some broadcasters, each traffic management
software system provider would have to program, test, and finalize an
export function tailored to the Commission's servers, consuming
``hundreds of thousands of man hours,'' after which broadcasters would
have to install this new software on their existing systems, and
[t]aken together, these steps would stretch into years, and the costs
would be significant.'' Under the rules we are adopting, broadcasters
will not need to change the software in their traffic systems to post
documents to our online public file, though they are free to do so if
that is the approach they wish to take. Rather, stations will either
need to save such files to widely available formats such as Microsoft
Word (.doc) or rich text format (.rtf), or convert the files to
portable document format (.pdf) , and then drag and drop those files to
the Commission's online public file. We do not believe that either of
these alternatives will impose appreciable increased costs on
broadcasters as compared to current requirements.
38. Increased Access to Lowest Unit Charge Information. NAB
expresses concern about the ``unintended but potentially very real
marketplace distortions and consequences that could occur if market
sensitive information is readily accessible'' to its competitors. It
notes that, in addition to broadcasters, cable operators and DBS
providers must also keep a political file, and requiring only
broadcasters to place their political file online would ``place
broadcasters at a disadvantage vis-[agrave]-vis their competitors.''
NAB argues that ``[b]roadcasters could see advertising revenues drop if
competitors attempt to use the data in the file to undercut their
rates. This disadvantage would directly harm the public,'' NAB
continues, ``because, if advertising revenue drops due to disparate
regulation, stations would not be able to expand service offerings, and
may have to cut back on current offerings.'' Network Station Owners
also express concern about making ``[t]his proprietary information * *
* available to commercial as well as political advertisers, to other
local stations, and to competing advertising
[[Page 27639]]
media such as cable operators, newspapers and web sites.'' It argues
that because the political file contains ``information on the station's
lowest rates on particular programs and rotations,'' placing the
political file online will ``afford a significant intelligence
advantage to one side in private commercial negotiations. Armed with
political file information, the shrewd time buyer's ability to drive
the hardest possible bargain would be greatly enhanced by data allowing
him to estimate the station's bottom line. One poker player would, in
effect, have had at least a partial glance at the other's hand.'' \5\
---------------------------------------------------------------------------
\5\ One party also claims that online disclosure of a station's
political file will result in an uncompensated government taking in
violation of the Fifth Amendment. We disagree. Target Enterprises is
a media buyer that claims to have ``buil[t] a proprietary computer
statistical model and database'' to enable ``its clients to achieve
the most effective media purchases during an election cycle.''
Target claims that an uncompensated taking will result if the
details of political ad spending become available online in real-
time because Target's ``protected business model and proprietary
approach'' will be disclosed to the public and its competitors and
thus ``cause the value of the company to be lost.'' We reject
Target's takings claim on several grounds. The regulation at issue
does not result in a ``physical taking'' because it does not deprive
Target of any property right, much less result in a direct
appropriation or physical invasion of private property; rather, it
requires television broadcast stations to post online information
that they already make publicly available at their stations. Indeed,
television broadcast stations--not media buyers such as Target--are
subject to the online requirement, and thus no direct appropriation
or physical taking of Target's property can be shown. See Loretto v.
Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982) (to establish
a physical taking requiring just compensation, a party must show a
direct government appropriation or physical invasion of private
property). We note that no broadcast station has raised a takings
argument. Similarly, Target has failed to establish the factors
required for demonstrating a regulatory taking. See Penn Central
Transportation Co. v. City of New York, 438 U.S. 104 (1978)
(identifying several factors for determining what constitutes a
``regulatory taking,'' including the economic impact of the
regulation, the extent to which the regulation has interfered with
distinct investment-backed expectations, and the character of the
government action). Nothing in the Commission's regulations
restricts Target's ability to use or keep confidential its computer
models, database, or any other alleged ``trade secrets.'' Moreover,
Target's claim involves the general health of its business rather
than specific property or estimates as to the property's likely
diminution of value. As the Supreme Court has explained, unilateral
expectations and abstract needs are not sufficient to raise takings
concerns. Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1005-1006
(1984). Further, the broadcasters subject to the online posting
requirement operate in an industry that has long been regulated and
thus this regulatory context undercuts the reasonableness of
Target's purported expectations. Concrete Pipe and Products of
California, Inc. v. Construction Laborers Pension Trust for Southern
California, 508 U.S. 602, 645-646 (1993) (noting, in rejecting the
claim of interference with reasonable investment backed
expectations, that ``those who do business in the regulated field
cannot object if the legislative scheme is buttressed by subsequent
amendments to achieve the legislative end'').
---------------------------------------------------------------------------
39. We find that placing this already-public information online
will not cause significant market distortions. Furthermore, the
benefits of placing the political file online are substantial, and we
will not exclude it on the basis of unsubstantiated burden arguments.
Broadcasters have failed to provide any evidence to support their
claims of commercial harm. We note that several parties raised the
claim of ``commercial harm'' in the final weeks prior to adoption of
this item, but the filings contain little more than generalized and
vague assertions. Most important, we are not requiring broadcasters to
make any information publicly available that stations are not already
required to make public. Broadcasters have been required to make
political file information including rates charged for political
advertising, available in some form since 1938, and anyone, including
broadcasters' competitors and customers can currently access these data
in the paper files. In addition, since 2002, Section 315(e) of the Act
has specifically required that the political file include ``the rate
charged for the broadcast time.'' Moreover, the public files of
broadcasters' competitors have been available in paper form to
television broadcasters and the public for years. Given the mutual,
long-standing public availability of such documentation and the likely
knowledge of this availability among major commercial and political
buyers, we do not believe that the increased ease of access to
broadcasters' public files will lead to significant distortions in the
marketplace. Although we do not know the exact percentage of
advertisers and competitors that seek review of information in
stations' political files, we are aware they do so on a regular basis,
as Commission staff frequently receives calls from stations asking
whether or not they must provide such entities access to the political
file. As staff has previously instructed in these situations, all
members of the public--including advertisers and competitors--are
entitled to access a stations' political files. To the extent it is
economically beneficial for competitors, potential advertisers, or
buyers who seek to represent advertisers, to access this data, they
already have the ability to review the material at the stations. Buyers
do, in fact, review the political file. We recognize that, because of
their economic incentive, competitors and potential advertisers may be
more likely to undertake the expense of visiting stations to review the
current political files. We expect that having the files accessible
online will encourage other members of the public to make use of the
political files. Commenters have failed to show that an online posting
requirement would alter in any meaningful way the economic incentive of
these entities. Moreover, even if it had not been publicly available
for decades, online posting of lowest unit charge information would not
necessarily lead to marketplace distortions. While the political file
lists the lowest unit charge that a candidate receives, it does not
reveal significant information about the commercial transaction that
established that lowest unit charge. Various factors unknown to another
commercial buyer--including that the advertiser establishing the lowest
unit charge bought a higher volume of ads, committed to a long-term
advertising relationship, or other variables--can justify denying the
lowest unit charge rate to a different commercial buyer under different
circumstances. In addition, the fact that there are many variables
(lengths, classes of time, and time periods) for any given lowest unit
charge makes it harder for any potential purchaser to find a lowest
unit charge that is comparable to the ad purchase it is seeking to
make. These variables also make it difficult to compare the lowest unit
charges of competing stations, as the stations may not sell the same
classes of time. In the end, stations are in control of setting lowest
unit rates, and have final determination of how low they are willing to
set their commercial rates. Further, given that the statute expressly
requires such information to be placed in the public file, exempting
such rate information would be contrary to the statutory directive to
make the political file publicly available.
40. Effect on How Stations Sell Time. NAB argues that online filing
would necessitate changes in how stations sell political advertising
time, because ``the variances in the ways in which stations manage
political advertising sales and the political file'' would not be
compatible with a ``standardization of stations' political file
processes.'' These arguments seem to be based on a misunderstanding of
our proposal in the FNPRM. As the Commission emphasized in the FNPRM,
the online political file is meant to serve as a source of information
to candidates, buyers, viewers, and others, but the actual purchase of
advertising time and the receipt of equal time requests will continue
to be handled by the station. We reiterate that we are merely
[[Page 27640]]
changing the form of disclosure to the public of information already
required to be in the public file. We are making no change in the
political advertising sales process. Rather, we expect stations to
continue handling political ad sales in whatever way is most convenient
to them.
41. Substantive Political File Requirements. We likewise are not
persuaded by arguments that the rules regarding what material must be
included in the political file are vague and that, therefore, the
Commission should not adopt an online posting requirement. As discussed
above, this proceeding simply modernizes the procedures television
broadcasters use to inform the public about information they are
already required to disclose. If any licensee is unsure about any
aspect of our political file requirements, it may request clarification
of our existing substantive disclosure rules. To respond to specific
questions raised in this record, however, we offer the following
guidance. The political file rule requires that licensees ``keep and
permit public inspection of a complete and orderly record (political
file) of all requests for broadcast time made by or on behalf of a
candidate for public office, together with an appropriate notation
showing the disposition made by the licensee of such requests, and the
charges made, if any, if the request is granted.'' The same
information, among other things, must be included with respect to issue
advertising containing a message relating to a ``political matter of
national importance.'' These issue ads will also need to be included in
the online political file, just as they currently need to be included
in the local political file. One commenter argues that it is unclear
what ``requests'' includes. Although we do not think that term is
unclear, we clarify that licensees are required to place in their
political files any final orders by candidates for specific schedules
of time or availabilities within a specific schedule of time--in other
words, orders to buy particular schedules (including programs or
dayparts), amounts of time (including spot or program lengths), and
classes of time for particular days (such as preemptible spots, Monday-
Friday rotations, runs of schedule or specific placements). We note
that ``any final orders'' mean orders that station representatives
reasonably believe to be a final, agreed-upon order. If the final order
is later amended after being included in the on-line political file, a
station can replace the previously final order with the amended final
order, or may simply upload the amended final order. Licensees are not
required to place in their political files general requests by
candidates for advertising time stations have available to purchase, or
rates for a general array of time.
42. In response to concerns that the term ``disposition'' is
unclear, we note our rules define it as ``the schedule of time
purchased, when spots actually aired, the rates charged, and the
classes of time purchased.'' We clarify that the ``disposition'' of the
request does not include a record of the negotiations or back-and-forth
discussions between the licensee and the candidate after the request is
made. It does include the final, mutually agreed upon order of time,
including: classes of time purchased; charges made; as well as any
subsequent, relevant reconciliation information about the order,
including the times spots actually aired and details such as any ``make
goods'' provided for preempted time, and rebates or credits issued.
43. Existing Political File. Commenters argue that if we require
stations to upload the existing political file, it will be unduly
burdensome. Some broadcasters provide projected costs and burdens of
placing the political file online. NAB estimates that just uploading
the existing political files could take hundreds of hours per station.
NAB supported its assertions about the burdens of uploading the
existing political file by providing the estimated size of the
political file in inches for six stations in six different television
markets, ranging in size from 3,150 pages to 8,100 pages. For example,
NAB noted that a political file in Burlington, Vermont measured 19.5
inches, which they estimated as equaling 4,388 pages. Free Press argues
that such estimates are exaggerated. Free Press states that it visited
all of the television stations in Burlington, Vermont, and was unable
to find any political file that was as large as the files discussed by
NAB. Further, their review found that each political file reviewed
contained documents beyond the required two year retention period,
illustrating the possibility that ``broadcasters may be mistakenly (and
vastly) inflating the size of the political files they actually are
required to maintain.'' NAB bases its projections on the largest
political file it reported. While we believe that this burden
projection is overstated, we recognize that the existing political file
may contain the greatest number of pages for broadcasters to upload as
they transition to an online public file. Our review of the public
files in the Baltimore DMA indicates that the commercial stations'
political files were made up, on average, of 1568 pages, and accounted
for, on average, 30% of the stations' public files. This excludes
letters and emails from the public, which will be retained in the local
file. One station's political file was made up of 4079 pages, or almost
70% of its public file.
44. Departing from the proposal in the FNPRM, we do not require
stations to post the contents of their existing political files to the
Commission's online public file. Given the two-year retention period
for the political file, broadcasters' investment in uploading existing
political files would have a limited return for the public. Likewise,
exempting the existing political file will only require broadcasters to
continue to maintain a robust local file for a relatively short period.
Because of the two-year retention period for the public file and the
relatively large size of existing files, we conclude that exempting the
existing political file from online posting is a reasonable means of
reducing the initial burden of moving public files online.
45. Small Market and Non-Affiliate Exemption. Finally, we adopt in
part a broadcaster request that we delay online posting of the
political file for smaller stations. These commenters argue that we
should allow all broadcasters to gain experience working with the
online public file system before requiring that they maintain their
political file online. As noted above, this proceeding is over a decade
old, and we believe it is time to bring the accessibility of the entire
public file into the 21st century in as expeditious a manner as is
possible.
46. We are persuaded, however, that it is appropriate to allow
certain stations additional time to begin uploading the political file.
As discussed further below, because the contents of the political file
are time-sensitive, stations must place records in the political file
``immediately absent unusual circumstances.'' We believe it is
appropriate to require stations with a greater market reach to
undertake this time-sensitive transition first, as they will be more
likely to have dedicated resources to address any implementation issues
that arise, if necessary. Therefore, we will temporarily exempt
stations that are not affiliated with the top four national television
broadcast networks (ABC, CBS, NBC and Fox) in the top 50 DMAs and all
stations that serve markets below the top 50 DMAs, regardless of
affiliation, from including their political file in their online public
file for two years. We note that this exemption is permissive, not
mandatory. If any station that falls within this exemption prefers
instead to immediately
[[Page 27641]]
transition to the online political file, it is permitted to do so. This
exemption will ease implementation for broadcasters during the initial
transition to the online public file, while also giving the Commission
time to ensure that the online public file system is implemented
effectively.
47. We believe that exempting stations that are not affiliated with
the top four networks (ABC, CBS, NBC and Fox) in the top 50 DMAs, and
those stations in markets below the top 50 DMAs, creates an exemption
threshold that is clear, easy to establish and implement, and not often
subject to significant change. Other options for identifying the class
of stations to exempt do not provide the certainty that this clear
definition provides. For example, an exemption for the top four ranked
stations in each market would create a threshold that is often subject
to change, would be difficult to measure and administer, and would
provide uncertainty to broadcasters, as they are not as able to predict
or control ratings. The Commission has used a DMA and affiliation-based
standard in other contexts, and we believe it is appropriate to use in
this instance.
48. Moreover, while this exemption will ease the initial
implementation for broadcasters, it will nonetheless provide the public
with online access to the political files of stations garnering the
vast majority of political advertising time and money. Stations
affiliated with the top four broadcast networks often provide the
highest-rated programming, and therefore the most-watched advertising,
including a large proportion of political advertising. Based on numbers
provided by Kantar Media, we find that these 11 percent of stations,
which reach 65 percent of Americans, account for roughly 60 percent of
the total television political advertising dollars spent in each major
election cycle. Affiliated stations are also more likely to have
dedicated IT resources to resolve issues that may arise with
implementation of the online political file in the expeditious manner
that will be necessary for the political file. Stations that will be
exempt initially from the rule generally have smaller political files
than the affiliates in the top 50 DMAs, and therefore the public will
not be deprived of online access to substantial amounts of political
file information during the limited exemption period. In our review of
the political files of the Baltimore DMA, the political files of the
stations that will be exempt averaged 247 pages, which is substantially
smaller than the political files for the stations affiliated with the
top four networks, which averaged 2104 pages. In addition, we believe
that the approximately two years of experience that stations will gain
by transitioning the rest of the online public file will help to ensure
that they are prepared to upload the political file. We also believe
that delayed implementation for stations with a smaller market reach
will ensure that the Commission is able to target assistance to these
stations, if necessary. Commission staff will gain experience with the
process of assisting the smaller first wave of broadcasters
transitioning to the online political file. This will enable staff to
more efficiently assist the larger number of stations that will
transition later, who may need enhanced support because of their more
limited IT resources.
49. As part of our efforts to evaluate the effect of this
transition, the Media Bureau will issue a Public Notice by July 1, 2013
seeking comment on the impact of these rules. This Public Notice will
give commenters--including the initial group of stations to use the
online political file, stations that have yet to transition, and
members of the public that review the online political file--an
opportunity to provide the Commission with information regarding the
impact and utility of the online political file. The Public Notice will
enable the Commission to consider whether any changes should be made
before the requirement takes effect for the other stations.
50. As discussed above, we do not believe online posting of the
public file, including prospective posting of the political file, will
impose an unreasonable burden on any television broadcaster.
Nevertheless, if licensees not covered by the two-year exemption
believe filing new political file materials online will impose an undue
hardship, they may seek a waiver of this requirement. Stations seeking
waivers should provide the Commission with information documenting the
economic hardship the station would incur in complying with this
requirement, its technical inability to do so or such other reasons as
would warrant waiver under our general waiver standards.
51. Authority. No commenter challenged the Commission's authority
to require online posting of the public file generally, but NAB
suggests that the Commission lacks authority to require the placement
of station political files online, and that we therefore must carve out
the political file from the rest of the public file. In supplemental
comments, NAB argues that in the Bipartisan Campaign Reform Act of 2002
(``BCRA''), Congress expressly required that the IRS and FEC make
certain election-related records available online, but did not do so
for the items required to be placed in broadcasters' political files.
They assert that ``the clear implication is that Congress did not
intend for broadcasters to be subject to an obligation to place their
political files online and thus, the FCC lacks authority to impose such
a requirement absent further legislative action.'' NAB further argues
that ``[w]here Congress includes particular language in one section of
a statute but omits it in another section of the same Act, it is
generally presumed that Congress acts intentionally and purposely in
the disparate inclusion or exclusion.''
52. We find NAB's argument unpersuasive. NAB overlooks relevant
facts relating to the adoption of BCRA. First, in adopting the
political file retention requirements of Section 315(e) of the
Communications Act as part of BCRA, Congress explicitly required that
``a licensee shall maintain, and make available for public inspection,
a complete record of a request to purchase broadcast time'' and that
``[t]he information required under this subsection shall be placed in a
political file as soon as possible and shall be retained by the
licensee for a period of not less than 2 years.'' In doing this,
Congress essentially codified the existing political file regulations
as reflected in Section 73.1943 of our rules at the time, and placed no
new restriction on the Commission's discretion to implement the public-
access policy. That is particularly significant because, at the time of
BCRA's passage, the Commission had tentatively concluded in this very
proceeding that stations should place their public inspection files--
including their political files--online. Congress was presumably aware
that moving the political file online was actively being considered by
the Commission, and expressed no intent to prevent such updating of the
rules. Congress instead placed no restriction in BCRA on how the
Commission may direct stations to make the political file ``available
for public inspection.'' Because the statute is silent on the question
of how stations should make the political file ``available for public
inspection,'' the Commission, as the expert agency required to
implement the Communications Act's provisions, has discretion in
determining how to do so, provided that the Commission's decision ``is
based on a permissible construction of the statute.'' Given this
context, we do not believe that ``available for public inspection''
equates to ``available only in paper format and not online,'' as NAB
asserts. We instead believe that this
[[Page 27642]]
requirement of availability for public inspection allows us to require
that such records be made available for public inspection online,
particularly given the ubiquity and general expectation of electronic
access to records today.
53. NAB also argues that ``[i]t is apparent that Congress intended
the FEC to be the central repository of campaign information.'' From
this, they argue that requiring the political file to be placed online
would constitute ``duplicative disclosure.'' This argument overlooks
the explicit requirement in Section 315(e) that stations ``maintain,
and make available for public inspection, a complete record of a
request to purchase broadcast time.'' NAB seems to be arguing that the
statute, rather than our proposed regulation, is unnecessary and
duplicative. The Commission ``must give effect to the unambiguously
expressed intent of Congress.'' Here, that unambiguous intent is that
the Commission require stations to make the contents of the political
file, as outlined in the statute, ``available for public inspection.''
Both the existing requirement, and the proposed online update, give
effect to the expressed Congressional intent. We note as well that
NAB's arguments regarding the Commission's authority are
contradictory--in the first argument, NAB wants to read BCRA's lack of
language concerning an online file strictly, and in the second, it
wants to ignore the political file statutory provision entirely. We
conclude that neither reading is correct. NAB also quotes the FCC's
comments in an FEC proceeding in 2002, which stated that the FCC's
creation of an online database to comply with BCRA ``could be
extraordinarily complex and will require the expenditure of substantial
resources in terms of time, money and personnel.'' NAB goes on to say
that ``[t]he online posting burdens that the FEC proposed to impose on
the FCC ten years ago and that caused the FCC to express concern are
different from those the agency proposes to impose on television
stations today. But the issues here about the burdens that would be
imposed on stations by the FCC's online file proposals ``in terms of
time, money and personnel'' are similarly entitled to respect and
weight.'' As discussed in detail in the text, we have afforded
considerable respect and weight to broadcasters' assertions about the
burdens involved with posting their public files online, and have
adopted a number of measures intended to reduce those burdens without
sacrificing the goals of this proceeding.
54. Furthermore, the information filed with the FCC and the FEC is
substantially distinct and intended for different purposes. The FEC was
established by Congress to regulate federal elections, and FEC
reporting requirements are limited to federal elections. The FCC's
political file, by comparison, requires disclosure of information
regarding all elective offices, including federal, state and local. The
FCC's broadcast political file must be made ``available for public
inspection'' in part to notify candidates of information pertaining to
transactions by an opponent. This notification is necessary in order to
assess candidates' equal opportunities rights under Section 315
corresponding to an opponent's purchases of ad time. The FEC does not
collect any of the specific data that would be useful to candidates in
connection with their equal opportunities rights, all of which appear
in the political file, including: ``(A) Whether the request to purchase
broadcast time is accepted or rejected by the licensee; (B) the rate
charged for the broadcast time; (C) the date and time on which the
communication is aired; (D) the class of time that is purchased.''
Instead, the spending data collected by the FEC requires candidates to
disclose the aggregate amount expended during the period of time
covered by the disclosure to a particular payee, the mailing address of
the payee, the purpose of the transaction(s), the candidate's name and
federal office sought, and the date of disbursement. Typically,
candidates make their television advertising purchases through media
buyers. Thus, under the FEC's aggregate disclosure requirements, a
candidate would only need to disclose the funds provided to a media
buyer without disclosing how the media buyer allocated such funding--
whether it goes to television, radio or print media, let alone how much
was paid to each television station. There is no requirement to
identify the specific components of the ad-sales transactions that
broadcasters include in their political files, making the FEC
disclosures nearly useless for a candidate seeking equal opportunities
or learning what rates their opponents paid or the schedule of time
purchased, and useless to members of the public who are seeking
information about the purchasers of specific advertisements being
carried on their local television station.
55. Immediacy. Consistent with our current political file rules, we
adopt the FNPRM's tentative conclusion that stations must upload
records to their online political file ``immediately absent unusual
circumstances.'' Whether maintained at the station or online, the
contents of the political file are time-sensitive. For example, a
candidate has only seven days from the date of his or her opponent's
appearance to request equal opportunities for an appearance.
56. We do not believe that complying with the longstanding
immediacy requirement will be any more difficult when uploading to an
online public file than when placing paper in a local file; in fact,
using the online public file should often be quicker and more
efficient. Some commenters claim that uploading the political file to
the online public file immediately absent unusual circumstances is
either extremely burdensome or technically impossible, with no public
benefit. These commenters state that political advertising buys are
fluid and often made at the last minute. They also point out that the
final documentation indicating when spots are aired and how much is
charged for them is typically generated only on a monthly basis. They
note that for this reason, the Commission has advised that rather than
having to generate special documents, stations should provide the name
of a contact person who can provide parties reviewing the political
file with the times specific spots aired. NAB argues that if stations
were required to update the online political file to reflect the times
that spots aired on a daily basis, that could entail filing more than
100 pages per day of traffic reports in addition to the materials
already required to be in the political file. Other commenters argue
that moving the political file online will not lessen disruptions to
station operations, because the delayed final disposition information
about when a spot was aired is information that candidates are
interested in obtaining from the station, and stations will still need
to field daily in-person inquiries from buyers seeking this
information.
57. These arguments generally suggest that online filing would
involve a change to existing substantive requirements for assembling
the public file. Under our existing rules, however, the political file
must include all requests for broadcast time made by candidates, the
final disposition of that request, and the charges made. The FNPRM did
not propose to change these record-keeping requirements, and we do not
do so.\6\ We understand that stations
[[Page 27643]]
generally place initial requests and the final order agreed to between
the candidate and the station into the political file immediately,
consistent with our rules. We also understand that stations do not
routinely place documentation relating to reconciliation information--
including the times spots actually aired and details such as any make
goods for preempted time, rebates, or credits issued--in the political
file on a daily basis. Stations instead make station personnel
available to answer questions about final reconciliation in person, by
email, or over the phone, and place written documentation about the
final disposition in the file at a later date consistent with business
practices--usually when final billing is compiled for the purchaser on
a monthly basis. This practice is permitted. As the Commission stated
in the Political Rules Reconsideration decision, ``stations need not be
required to employ extraordinary efforts to place immediately in the
political file the exact time that candidate spots aired * * *. [I]t
will be sufficient to provide information concerning the spots and
program times that were ordered by the candidate, with a notation that
the station will, upon request, provide immediate assistance and access
to the station logs or other definitive information concerning actual
air time.'' We are not changing this precedent or practice. We are
merely requiring that the materials that stations currently copy and
place in their local files on a daily basis now be uploaded to the
online public file on a daily basis, and that other information be
uploaded consistent with existing business practices as previously
approved under Commission precedent. In addition to making this
information available online, stations are free to continue making this
information available over the phone to candidates and their
representatives, if that is their preferred business practice, and as
long as that courtesy is extended to all candidates and their
representatives. Modernizing public inspection procedures for material
in the public file will not increase stations' costs of communicating
information that is not yet in the public file.
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\6\ We are not persuaded by alternative proposals, one by News
Corporation and another by a coalition of broadcast station groups,
to adopt additional record-keeping requirements for stations with
respect to the political file. The proposal initially advanced by
the coalition of broadcast station groups was that we not require
stations to make their entire political files available online, but
rather require online posting--on either the Commission's or the
station's Web site, at the station's election--certain aggregate
data concerning candidate purchases of advertising time, with weekly
or monthly updates. An expanded coalition later advanced a revised
proposal that would require stations to upload certain aggregate
data concerning candidate purchases of advertising time, with
updates daily, every second day, or weekly. News Corporation, on the
other hand, submitted a proposal that would provide stations with
the option of either placing their political files online or putting
summary information (but not individual rates) in the online public
file, while requiring stations to continue to maintain a paper file
at the station that includes the rate information. While we
appreciate the efforts of these parties to develop alternatives, we
believe that these options will deprive the public of the benefits
of immediate online access to all the information in the political
file. These suggested approaches would impose a new substantive
public file reporting obligation on stations, which would be
contrary to our goal of limiting the burdens on broadcasters.
Furthermore, our political file disclosure requirements take into
account a candidate's equal access opportunities afforded under the
statute. Under our rules, these rights exist for only 7 days;
therefore, to be of value in this regard stations must post
political file information immediately. The proposals requiring
stations to post information every other day during the equal
opportunity period (or even every day in the week before an
election), would have limited value to candidates seeking to
exercise their equal opportunities rights.
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58. Finally, some commenters argue that the existing political file
system works adequately for stations and candidates, and that it is
unreasonable to make the political file available immediately online
for the benefit of researchers and other members of the public.\7\
Network Station Owners assert that the interests of researchers,
scholars and citizens in having access to information about political
spending ``is not immediate and can be satisfied by visiting the
station either during or after the election campaign.'' These
commenters seem to be arguing that the needs of stations and candidates
are singularly important, and that if these constituencies are not
seeking changes to how the political file is maintained, then no
changes are warranted. We disagree. First, as LUC Media points out,
candidates will benefit from real-time posting of the political file.
Supporting that view, the record indicates that the online political
file will be used by candidates, their representatives, and the general
public. Second, as discussed above, the statute does not prioritize any
potential users of the political file; it broadly mandates that the
materials be made ``available for public inspection * * * as soon as
possible,'' which the Commission has long interpreted to mean available
to all members of the public ``immediately absent unusual
circumstances.'' The Named State Broadcasters Association expresses
concern that ``public advocacy groups and the Commission will play
`stop watch' roulette if the political files were to go online.'' They
state that the base fine for political file rule violations is $9,000
and that ``the FCC will have a strong incentive to find at least
technical shortcomings in every television station's efforts to comply
with the mechanics of a new online political file requirement,''
potentially exposing them to large fines ``notwithstanding the good
faith efforts of staff-constrained broadcasters.'' We reject this
reasoning. First, if such an enforcement incentive exists, it would
exist now with the existing public file rule. Second, as discussed
throughout this proceeding, our aim in making the public file available
online is to make it more accessible to the public. Commenters'
unsupported speculation about possible arbitrary enforcement provides
no basis for maintaining the obsolete paper filing system. Moreover, we
reject the Named State Broadcasters Association's argument that the
base fine for public and political file violations'' should be lowered,
an issue that is beyond the scope of this proceeding.
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\7\ Joint TV Broadcasters argued that ``even PIPAC, the entity
urging the FCC to require stations to post their political files
online has recognized that the political file can change daily
during the election season and has suggested that the online posting
requirement `could include provisions for a reasonable delay in
posting updated information.' '' They contend this supports their
conclusion that it would be difficult for stations to upload this
information ``in real time.'' The commenter fails to note that with
respect to burdens, PIPAC actually stated its belief that ``placing
this information online will reduce the burden on broadcasters that
often receive multiple daily in-person requests to access this
information during an election season.'' In their comments, PIPAC
``strongly supports'' the public file proposal discussed in the
FNPRM.
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59. Orderliness. The Commission will design the online public file
with an organizational structure that will ensure that the contents of
the file, including the political file components, are orderly and
easily uploaded and downloaded. The Commission's rules require
licensees to keep ``a complete and orderly'' political file. The
Commission stated in the FNPRM that it expected licensees to upload any
political file information to the online file in an organized manner so
that the political file does not become difficult to navigate due to
the sheer number of filings. For an online political file to be useful,
the Commission acknowledged, candidates and members of the public must
be able easily to find information that they seek. The Commission asked
whether it should create federal, state, and local subfolders for each
station's political file, and whether it should allow stations to
create additional subfolders within the political file.
60. NAB recognizes that there are efficiencies in the Commission
creating some organizational categories for stations to use, and argues
that ``to the extent that the Commission can do this in a timely and
accurate manner, for both the general and primary elections for every
race in the country where
[[Page 27644]]
candidates and issue advertisers may purchase advertising on a local TV
station, NAB agrees that it would be desirable.'' We agree with NAB
that it would be desirable and less burdensome on broadcasters for the
Commission to create specific organizational subfolders, not only for
candidate ad buys, but also for issue ads that relate to a political
matter of national importance.
61. NAB also argues that the Commission should continue its policy
of allowing broadcasters to manage their political file in a manner
consistent with their particular operational and sales procedures. It
expressed concern that if the Commission creates a rigid standardized
organizational structure, they will have to redesign their traffic
management systems, which would expand the burdens on broadcasters by
interfering with systems that stations use and that are tailored to
their own circumstances. NAB argues that the Commission should provide
broadcasters with the flexibility to create their own subfolders and
``subcategories'' in order to further organize the data, and recommends
that the Commission consider employing the services of a third-party
Web-based file hosting service such as Dropbox. To facilitate
broadcasters' use of the online file, we will create and propagate
subfolders for candidates and will provide stations with the ability to
create additional subfolders and subcategories in compliance with their
own practices. We also agree with NAB that the use of hosting services
providing a mechanism to allow stations to drag and drop files and
folders to the online public file will allow for greater efficiencies.
We delegate to staff the authority to incorporate such efficiencies,
and to cooperate with industry as it develops specifications to enable
such efficiencies and to incorporate them in the online system, to the
extent the staff concludes that such approaches are workable and
effective. We also delegate to staff the authority to design, add to,
or adjust the features of the online public file, as needed, to
increase its ease of use.
2. Letters From the Public
62. Responding to commenters, we exempt letters and emails from the
public from the online public file, instead requiring that such
material be maintained at the station in a correspondence file. In the
FNPRM, the Commission proposed that letters and emails from the public,
which now are required to be included in the local file, should not be
incorporated in the online public file, but instead continue to be
retained at the station for public viewing in a paper file or an
electronic database at the station's main studio. The Commission
tentatively agreed with reconsideration petitioners that privacy and
burden concerns were significant enough to merit excluding these
documents from the online public file, and sought comment on its
findings.\8\ Alternatively, the Commission asked whether it should
allow or require stations to redact personally identifiable information
before posting letters and emails online. Some commenters, broadcasters
and public interest advocates agree that letters and emails from the
public should not be placed online due to privacy concerns and the
burdens of review and redaction that such concerns would necessitate.
Some broadcasters believe that stations should maintain a
correspondence file available locally at the station, while others
think we should eliminate the requirement entirely. Common Frequency
argues that privacy concerns are exaggerated, since it is common for
members of the public to comment on publicly available Web sites.
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\8\ The Commission also sought comment about whether other
public file information raises similar privacy concerns. We received
very little input on this issue, and will not make any other
privacy-based exemptions to the online public file. Our Privacy
Threshold Analysis (``PTA'') of the online files indicates that the
files to be posted may contain personally identifiable information
(``PII''). Consequently, the Commission will be preparing a Privacy
Impact Analysis (``PIA'') and a Privacy Act system of records notice
(``SORN'') to govern the handling of PII in the station files.
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63. We are concerned that requiring correspondence to be placed in
the online public file may result in violations of the Children's
Online Privacy Protection Act (COPPA), which prohibits posting
children's personally identifiable information online. Commenters agree
with our privacy concerns. Our review of the public files in the
Baltimore DMA indicates that letters and emails from the public can
account for up to one third of a station's public file. Thus, requiring
stations to review these documents for compliance with COPPA before
uploading them to the online public file could pose a burden, which our
decision avoids. Therefore, we will not require stations to post this
information in the online public file.
64. At the same time, we do not believe that the requirement to
retain correspondence from the public should be eliminated entirely.
Letters and emails are required to be made available to the public
under our rules, and this proceeding is about updating the
accessibility of the public file, not about changing its underlying
requirements. We will require stations to maintain in a paper file, or
electronically on a computer located at the main studio, a publicly
available correspondence file at the station. As currently required,
this file will include all letters and emails from the public regarding
operation of the station unless the letter writer has requested that
the letter not be made public or the licensee feels that it should be
excluded due to the nature of its content, such as a defamatory or
obscene letter. We also note that NCE commenters have requested that we
clarify that noncommercial educational stations are not required to
retain letters and emails in their public inspection files. This
request for clarification stems from an inadvertent error in the draft
rules published in the FNPRM. We confirm that NCE stations are not
required to retain letters and emails from the public, and note that
the rule changes reflect this. We emphasize that we are not imposing a
new requirement here, but merely retaining the existing requirement for
retaining correspondence consistent with our rules.
65. The FNPRM also sought comment on a proposal by PIPAC to require
stations to report quarterly on how many letters they have received
from the public. PIPAC was the only supporter of this proposal. Another
commenter noted that such reporting would be burdensome for
broadcasters, some of whom receive thousands of pieces of viewer
correspondence in a year. We are not persuaded that a mere count of
letters received would be of substantial value to the public or the
Commission. We thus conclude based on the current record that the
burdens of tabulating and reporting on such correspondence cannot be
justified, and we do not require it.
66. The Commission also sought comment on whether stations should
have to retain comments left by the public on social media Web sites,
like Facebook, and tentatively concluded that such information should
not be required to be maintained in the correspondence file. Those who
addressed this issue agree with our tentative conclusion that, because
social media posts are already accessible to the public, the burden of
requiring stations to place such material in a correspondence file
would outweigh any benefit. We adopt this assessment, and will not
require stations to retain social media messages in their
correspondence file.
67. Common Frequency suggests that email comments to the station
can be standardized for all stations through a comment form on the
Commission-
[[Page 27645]]
hosted public file Web site, and all commenters could be directed to
this form. We decline to adopt this requirement. We do not believe that
the Commission is the proper forum to shape the dialogue between a
local station and its viewers. Rather, we seek to encourage direct
communication between the station and its viewers. As discussed below,
the online public file will contain contact information for each
station. We encourage members of the public to relay their concerns
directly to the station.
3. Other Components of the Online Public File
68. Contour maps. We adopt the tentative conclusion that the
contour maps available on the Commission's Web site are sufficient for
the online public file. Our rules require that the public file contain
``[a] copy of any service contour maps submitted with any application
tendered for filing with the FCC, together with any other information
in the application showing service contours and/or main studio and
transmitter location.'' In the FNPRM, the Commission noted that maps
showing stations' service contours are available on the Commission's
Web site, and are derived from information provided by stations in
CDBS. The Commission tentatively concluded that these contour maps
available on the Commission's Web site are sufficient for the online
public file as they provide the necessary information regarding a
station's service contours. Only one commenter discussed this issue,
agreeing with the Commission that these contour maps are sufficient. We
ask that stations review these maps and contact the Media Bureau if
they believe they contain any inaccuracies.
69. Main Studio Information. We will adopt the proposal in the
FNPRM that we require stations to include in the online public file the
station's main studio address and telephone number, and the email
address of the station's designated contact for questions about the
public file. Given that the correspondence file will still be publicly
available at the station, along with the existing political file (until
its retention period expires in two years), and because we seek to
encourage an open dialogue between broadcasters and the viewing public,
we believe this information is necessary to assist the public. Stations
with a main studio located outside of their community of license should
list the location of the correspondence file and existing political
file, and the required local or toll free number. Joint TV Broadcasters
argues that if access to the public file is to be facilitated by means
of online posting, the justification for government regulation of a
station's main studio location, at a minimum, erodes substantially. We
disagree with this assertion, which is in any event beyond the scope of
this proceeding. The Commission has previously stated that a main
studio is necessary to maintain reasonable accessibility of station
facilities, personnel, and information to members of the station's
community of license, which enables the residents of the community to
monitor a station's performance, encourages a continuing dialogue
between the station and its community, and integrates a station into
the activities of the community in order to be more responsive to local
community needs in its programming. Although as a result of our action
today most required information about the station will be available
online, the other benefits cited here, as well as access to the
elements of the public file that will not be posted online, continue to
support maintenance of a local main studio.
70. The Public and Broadcasting manual. We adopt the tentative
conclusion that television stations will no longer be responsible for
making available ``The Public and Broadcasting'' manual in their public
files. We received no comment on this issue. As discussed in the FNPRM,
the Commission will make this manual prominently available on the
Commission-hosted online public file Web site once it is created. The
staff is directed to ensure that this manual is updated to reflect the
online public file requirements we adopt here.
71. Issues/programs lists. We adopt the proposal requiring stations
to post their issues/programs lists to the online public file until the
Commission adopts changes to this requirement. Broadcasters' public
files currently must include issues/programs lists, which are lists of
programs that have provided the stations' most significant treatment of
community issues during the preceding quarter. The Commission stated in
the FNPRM that it planned to expeditiously seek comment in a new
proceeding to investigate replacing the issues/programs list with a
standardized disclosure form, which it did last November in a Notice of
Inquiry.
72. In that Notice of Inquiry, the Commission noted that it remains
dedicated to addressing the problem of the lack of access to consistent
and uniform information about television broadcasters' programming.
Despite the shortcomings of the current state of the issues/programs
lists, however, for now this is the best source of information the
public has when investigating how a broadcaster's programming is
meeting the community's needs and interests. A group of stations
commenting as Four Commercial and NCE Licensees argues that the public
has minimal interest in viewing this information, and until there is a
standardized reporting form, issues/programs lists should not be placed
online because they are voluminous and might include program guides
that may not be easily uploaded. We disagree that the public has
minimal interest in viewing this information. Public advocacy
commenters PIPAC and Common Frequency point out that issues/programs
lists are the only requirement that broadcasters have to disclose how
they are providing community-responsive programming, and agree with the
Commission that these lists should be posted to the online public file
on a quarterly basis until the Commission implements a new standardized
form. When creating the issues/programs list requirement, the
Commission declared that one of a broadcaster's fundamental public
interest obligations is to air programming responsive to the needs and
interests of its community of license, and described the issues/
programs list as ``[t]he most significant source of issue-responsive
information under the new regulatory scheme.'' Moreover, the list is a
significant source of information for any initial investigation by the
public or the Commission when renewal of the station's license is at
issue. Because of the importance of the issues/programs lists, we
conclude that any burden imposed upon broadcasters to upload such
information is justified, and find that the lists must be available to
the public in the online public file.
73. FCC investigations and complaints. Our rules currently require
that stations retain in the public file ``material having a substantial
bearing on a matter which is the subject of an FCC investigation or
complaint to the FCC'' of which the station is aware. The Commission
sought comment in the FNPRM on whether the Commission should post
published sanctions, including forfeiture orders, notices of violation,
notices of apparent liability, and citations, in a station's online
public file. The Commission also asked whether licensees should be
required to upload their responses, if any, to such Commission actions.
The Commission noted that this is the sort of information that the
public would want to find in reviewing a licensee's public file, that
this is a natural extension of the requirement to retain Commission
[[Page 27646]]
correspondence, and that parties could seek confidential treatment of
particular information in the filings, if necessary. Common Frequency
argues that the Commission should require broadcasters to post all
materials relating to complaints, petitions, and Commission orders,
because the public has a right to know how a broadcaster is conducting
its business.
74. The public is entitled to review information regarding
Commission investigations and complaints and we consider the scope of
the disclosure rule for this material to be quite broad, although we
also recognize that premature publication can hamper an investigation
and that privacy concerns counsel some limitations on the online
posting of some of this information. We conclude that, subject to any
disclosure limitation included in a Commission inquiry itself or
directed by the staff, the online public file must include Letters of
Inquiry (``LOI''), any supplements thereto, and any other
correspondence from the Commission commencing an investigation,
materials related to such inquiries, licensee responses to these
Commission inquiries, and any documents--including Commission orders--
terminating or concluding the investigation or imposing penalties as a
result of the investigation. We agree that public access to this type
of information concerning a station--information that could be key to a
full understanding of a station's performance of its duties as a
licensee--is important and conclude that it must be placed in a
station's online public file. This material is relevant to any member
of the public that wishes to participate in a station's license renewal
process or to otherwise review and evaluate the service a station is
providing to its community of license. We will therefore adopt the
tentative conclusion in the FNPRM that stations' online public files
should contain all material relating to a Commission investigation.
Unless directed to the contrary by the Commission (in an LOI or
otherwise), stations will be responsible for uploading any materials
related to a Commission investigation or inquiry that they generate or
possess (such as responses to LOIs and relevant documents related to an
investigation). To reduce burdens on stations, the Commission, as it
deems appropriate, will post to the online public file any material
that it originates relating to an investigation, such as LOIs and other
investigative requests. The Commission will also post to the online
public file any complaint or complaints that it possesses and that
underlie an investigation, if doing so is feasible, will not interfere
with or obstruct an investigation and disclosure is consistent with any
privacy concerns that publication might raise. When there are
circumstances in investigatory and enforcement contexts that would
weigh against the disclosure of Commission investigations and related
materials, the Commission or the staff may inform a licensee that a
Letter of Inquiry or request for information or other material related
to a particular investigation need not be placed in the public file or
uploaded to the online public file. In the FNPRM, the Commission
acknowledged concerns expressed in reconsideration petitions about
posting to the online public file any material that is the subject of
an indecency investigation or complaint, and tentatively concluded that
such concerns were unfounded because such material is relevant to the
renewal process and the Commission already posts information relating
to indecency investigations, such as Notices of Apparent Liability and
Forfeiture Orders, on its Web site. As is the case today, stations
filing responsive materials subject to a confidentiality request may
place copies of their filings into the online database with the
confidential material redacted.
75. With respect to complaints that have not prompted an LOI or
other investigative request, whether filed with the Commission or
submitted only to the station, we believe local retention in the
station's correspondence file is appropriate. We conclude, as a general
matter, that privacy concerns weigh against routine online posting of
these complaints. The Commission or relevant Bureaus on delegated
authority, however, may expressly direct a licensee to post such
complaints--ones not related to any Commission investigation or
inquiry--to the online public file, or it may do so itself, if
circumstances warrant.
76. A few commenters argued that the Commission should not require
broadcasters to include information about erroneous or meritless
allegations in the online public file. They argue that these claims may
be unsubstantiated, and that persons with interests adverse to a
broadcaster would have an incentive to file false or irrelevant
complaints to establish a record tarnishing the broadcaster's character
that could be used against it in the license renewal process, and that
the increased accessibility to such false claims will increase such
incentives. As discussed above, we are not requiring stations to
include complaints that are not the subject of a Commission
investigation in their online public files, though they are required to
include them in their local correspondence files unless the Commission
specifies otherwise. We believe that commenters' concern about
erroneous or meritless allegations is adequately addressed by allowing
stations to include their responses to such complaints in their
correspondence files. As discussed above, stations are required to
include in their public files responses to Commission investigations,
unless directed otherwise in the LOI. As the Commission and the courts
are the final arbiters of whether allegations are meritorious, we will
not allow individual stations to decide whether particular
investigations and complaints against them should be kept out of the
public file.
77. EEO and Children's Requirements. Under the Commission's equal
employment opportunity (``EEO'') rules, all broadcast stations that are
required to create an EEO public file report are also required to place
their most recent annual report in their public file and post a link to
the report on their Web site, if they have a Web site. This requirement
was established in order to facilitate meaningful public input, as the
public has a ``right to participate in the process of monitoring and
enforcing our EEO Rule, which directly impacts them.'' We will continue
to require that stations make their EEO materials available on their
Web sites, if they have one. In an effort to reduce burdens on
broadcasters, however, we will permit stations to fulfill this Web site
posting requirement by providing on their own Web site a link to the
EEO materials on their online public file page on the Commission's Web
site.
78. Similarly, in light of our decision in this Order to require
stations with Web sites to provide a link to the online public file on
their homepage, we will not require that stations with Web sites also
post copies of their Children's Television Programming Reports (FCC
Form 398) on their Web sites. In the Further Notice of Proposed
Rulemaking in MM Docket No. 00-44, the FCC sought comment on whether
broadcasters should be required to provide their completed Form 398s on
their own Web sites. Members of the public interested in viewing a
station's Form 398 will be able to locate that filing from the online
public file and, therefore, we do not believe it is necessary to
require stations to post the forms on their own Web sites.
79. Existing Public File Sponsorship Identification Requirements.
Although, as discussed below, we do not impose new sponsorship
identification reporting requirements, we also do not exempt existing
public file requirements
[[Page 27647]]
regarding sponsorship identification from the online posting
requirement. Specifically, we decline the request by the National
Religious Broadcasters (``NRB'') to exempt from the online public file
the disclosure of material required in Section 73.1212(e) of our
rules--namely, where ``material broadcast is political matter or matter
involving the discussion of a controversial issue of public importance
and a corporation, committee, association or other unincorporated
group, or other entity is paying for or furnishing the broadcast
matter,'' stations must disclose ``a list of the chief executive
officers or members of the executive committee or of the board of
directors of the corporation, committee, association or other
unincorporated group, or other entity.'' We note that the rule also
states that ``[i]f the broadcast is originated by a network, the list
may, instead, be retained at the headquarters office of the network or
at the location where the originating station maintains its public
inspection file.'' In addition, Section 315(e) of the Act, added by
BCRA, requires that with respect to messages relating to any
``political matter of national importance,'' the political file must
contain ``the name of the person purchasing the time, the name,
address, and phone number of a contact person for such person, and a
list of the chief executive officers or members of the executive
committee or of the board of directors of such person.'' This
information must be included in the political file, and therefore must
be posted to the online file along with other political file
information Requiring that this information be included in the online
public file should impose little burden on broadcasters, as this
information is already being maintained in the local file.
80. In addition, we reject NRB's argument that making such lists
available via the Internet will violate citizens' First Amendment
rights to enjoy a level of privacy and anonymity regarding their
political, social, moral, and religious values and beliefs, and
associations. NRB argues that this will have a chilling effect on
citizens' willingness to participate in political campaigns. PIPAC
responds that making such already-public records available via the
Internet does not change the substance of the existing retention
requirement. We agree. In addition, we find NRB's argument that this
disclosure will chill citizens' speech overstated, as the disclosure
requirement in Section 73.1212(e) of our rules applies to executives
and board members of sponsoring organizations; it does not relate to
individuals' campaign contributions or other political activities. We
note also that the FEC requires candidates committees to report to the
FEC the identity of individuals who contribute more than $200 to a
candidate's campaign. The identity includes the individual's name,
mailing address and occupation, as well as the name of his or her
employer. We also agree with PIPAC that courts, in evaluating First
Amendment challenges, have embraced disclosure of sponsors of political
advertisements as promoting speech and discussion, not chilling it. As
the Supreme Court stated in Citizens United v. FEC, ``transparency
enables the electorate to make informed decisions and give proper
weight to different speakers and messages'' and that ``[w]ith the
advent of the Internet, prompt disclosure of expenditures can provide
shareholders and citizens with the information needed to hold
corporations and elected officials accountable for their positions and
supporters.'' Similarly, the First Circuit determined that state laws
requiring disclosure of the names of board members on political action
committees ``neither erect a barrier to political speech nor limit its
quantity. Rather, they promote the dissemination of information about
those who deliver and finance political speech, thereby encouraging
efficient operation of the marketplace of ideas.''
4. Proposals To Increase the Public File Requirement Rejected
81. We decline to adopt any new disclosure obligations with respect
to sponsorship identifications and shared services agreements at this
time. While we continue to believe that the public would likely benefit
from further information regarding sponsorship identifications and
shared services agreements as discussed in the FNPRM, we believe it
inadvisable to impose new reporting requirements at the same time
stations are transitioning to the online public file. We wish to ensure
that this Second Report and Order, in all major respects, involves
changing only the form of disclosure and location of material already
required to be included in the public file. We discuss both of these
categories below.
82. Sponsorship Identifications. We will not at this time require
new written disclosure of sponsorship identifications in the online
public file, as proposed in the FNPRM. Section 317 of the
Communications Act requires that broadcasters disclose to their
listeners or viewers at the time of broadcast whether material was
aired in exchange for money, services, or other valuable consideration.
The Commission's sponsorship identification rules implement these
provisions and require that stations provide an on-air disclosure when
content is paid for, furnished, or sponsored by an outside party. With
the exception of sponsored political advertising, and certain issue
advertising that must be disclosed in writing, these rules require that
stations make an on-air disclosure only once during the programming and
that the disclosure remain on the screen long enough to be read or
heard by an average viewer. The implementing rule has long had an
additional public file recordkeeping component for political and
controversial issue announcements, as discussed further below. The
FNPRM noted that the INC Report discussed examples of ``pay-for-play''
arrangements at local TV stations, where ``advertisers have been
allowed to dictate, shape or sculpt news or editorial content.''
Despite our decision not to add new reporting requirements, we continue
to believe that issues pertaining to sponsorship identification and
``pay-for-play'' are important. We will continue to monitor the use of
these practices, and enforce the statute as appropriate.
83. While we agree with commenters that additional written
sponsorship disclosures--posted to a station's public file--would
benefit the public by addressing the shortcomings of sometimes fleeting
on-air disclosures and would provide valuable information that is
otherwise difficult to collect, we are also persuaded that we lack
sufficient information at this time to properly evaluate the burden
that complying with this requirement would impose.
84. Sharing Agreements. We also decline to adopt the tentative
conclusion that stations include sharing agreements in the online
public file. In the FNPRM, the Commission asked whether sharing
agreements among licensees, such as local news sharing and shared
services agreements, should be available in the online public file.
Some broadcasters argue that the disclosure of sharing agreements
is beyond the scope of this proceeding, and should be considered in a
separate proceeding. They argue that the Commission must first solicit
comment and determine the legal status of such agreements. They argue
that there has been no determination that shared services agreements
are relevant to compliance with any Commission rules or standards,
unlike time brokerage agreements and joint sales agreements, which the
Commission has deemed to
[[Page 27648]]
have attribution implications, and which are required to be placed in
the public file. Some note that the recent 2010 Quadrennial Review
seeks comment on sharing agreements, and argue that it would be
premature to require disclosure of sharing agreements prior to the
conclusion of that review. We disagree that the Commission must first
address the appropriate regulatory status of such agreements prior to
requiring their disclosure, as disclosure itself could inform those
decisions and the Commission has wide latitude to impose such a
requirement. Nonetheless, we decline to impose this new requirement on
broadcasters as they transition to the online public file. We will
continue to monitor this issue, and revisit a disclosure requirement
either in this proceeding, or in the ownership proceeding, as suggested
by broadcasters. Because we decline to adopt this requirement, we will
not address comments pertaining to the scope of shared services
agreements covered by this proposal.
D. Format of the Online Public File
85. We will not establish specific formatting requirements for
documents posted to the online public file at this time. Some
commenters promoted making the data well-structured, as searchable as
possible, and downloadable. PIPAC argues that the online public file
should be searchable by text within the documents, and also by station,
state, date, element of the public file and any other metadata
contained in the file. They further argue that the file should provide
an easy-to-use graphic interface in addition to an API, as these both
provide searching and downloading of documents and metadata en mass. We
agree that certain information in the public file would be of much
greater benefit to the public if made available in a structured or
database-friendly format that can be aggregated, manipulated, and more
easily analyzed; this continues to be our ultimate goal. We agree with
PIPAC, however, that converting the files to this format would take
time and money, and the online public file should not be delayed in
order to make all of the material in it available in such a manner.
PIPAC argues that this will likely result in the submission of
documents in non-searchable, non-machine readable format, but it
believes this proposal represents a reasonable trade-off between
maximizing searchability and the need to expedite access to
broadcasters' online public files. We agree that this trade-off is
reasonable, and adopt the Commission's tentative conclusion that the
benefits of an online public file should not be delayed. At this time
we therefore will not require broadcasters to undertake the burdens of
altering the form of documents already in existence prior to posting
them to the online public file. We observe, though, that even without
mandating that documents be filed in a particular format, our creation
of a centralized, orderly public file will facilitate search and
analysis across all elements of stations' public files.
86. We adopt the FNPRM's proposal to require stations to upload any
electronic documents in their existing format to the extent feasible.
For example, to the extent that a required document already exists in a
searchable format--such as the Microsoft Word .doc format or non-copy
protected text-searchable .pdf format for text filings, or native
formats such as spreadsheets in Microsoft .xml format for non-text
filings--broadcasters are expected to upload the filing in that format
to the extent technically feasible. PIPAC agreed with our proposal to
require stations to file documents in their native electronic format.
We understand that it may be difficult for stations to provide older
material that has been in the public file for some time in its native
format. In those instances, we understand that stations may need to
scan these materials for electronic upload into the online public file.
We expect that the need to do this will diminish over time.
87. Also consistent with the FNPRM, the Commission will use optical
character recognition on public file materials that are scanned, and by
default are non-searchable. The Commission asked in the FNPRM whether,
to the extent documents are posted in a non-searchable format, the
Commission should digitize the documents and perform optical character
recognition (``OCR'') on them. PIPAC agrees with the Commission's
suggestion that if a broadcaster posts a record in only a non-
searchable format, the Commission should use an OCR tool to permit
maximum searchability. PIPAC notes that commonly available document
formats--including Microsoft Word .doc, .txt, .pdf or .odf--can be
searched, and can easily be converted into a .pdf file that can be
processed by an OCR tool so the contents can be loaded into a
searchable database. But commenter Ryan Thornburg notes that OCR
software is expensive and faulty, and prefers that the Commission
require well-structured formats. For the reasons discussed above, we
decline to do so at this time. We determine that, when appropriate, the
Commission will use OCR. OCR will be used when text cannot be extracted
from the uploaded document format. When documents are uploaded to the
online public file, documents that are not in recognized formats will
be automatically pushed into OCR, which will scan the document to
extract as much text as possible.
88. Metadata. We will not require stations to create or preserve
metadata in the online public file. In the FNPRM, the Commission asked
whether users should be able to determine when each item was uploaded
to the file, whether the Commission should make available metadata
about who uploaded the item, and if there were any concerns about
metadata disclosures for confidential or privileged information. NAB
anticipates that many stations may use software that removes metadata
from its documents for reasons of confidentiality, privilege, or
privacy, and does not see value in disclosing who uploaded a document,
other than differentiating between documents uploaded by the Commission
versus a station. The Sunlight Foundation noted that as long as each
station provides contact information, there is no need for the metadata
to identify the individual who uploads a filing. We agree, and
determine that stations using software that removes metadata will not
be required to make any modifications. Given that we will be requiring
station contact information, as discussed above, we do not believe that
it is necessary to make metadata information available as part of the
online public file. However, the Sunlight Foundation also argues that
being able to identify the time and date of a filing is important, as
it helps to track the most recent version of a particular filing, and
allows the user to create a timeline of submitted files. This
information, which is captured by the system as files are uploaded,
does not generate similar privacy concerns as the metadata contained
within the documents uploaded by stations. Our system may present
information on the date and time of a filing to users.
E. Implementation
89. Having concluded that broadcast television stations must upload
the contents of their public file, other than the political file and
letters from the public, to a Commission-hosted online public file, we
next discuss issues relating to implementation of the new posting
procedure. As with our consideration of all the issues covered by this
Order, our resolution of implementation issues is guided by a
commitment to creating an online public file experience that is not
[[Page 27649]]
burdensome for broadcasters, and is as useful as possible for the
public.
90. Cloud-Based Solution. We plan to develop the online public file
in accordance with the Federal Government's ``Cloud First Policy''
which directs agencies to default to scalable and elastic, cloud-based
solutions for increased reliability at lower cost. The public file,
consisting entirely of publicly disclosed material, is ideal for
leveraging the cloud-based hosting solutions. We anticipate being able
to design an online public file that is highly available, scalable,
cloud-based, and eliminates any user wait times associated with
processing documents after upload. We expect that this will enable
stations to upload public file material in a timely fashion, including
uploading political file material promptly even during times of
increased traffic prior to elections.
91. We disagree with broadcasters who argue that their experiences
trying to file the revised Form 323 ownership reports suggest a
Commission-created database would suffer from implementation problems.
These commenters represent that it can take hours to upload just one
attachment to the revised Form 323, and that the political file
contains similarly large documents. They argue that such delays would
be unacceptable with respect to the political file, where timely access
is so important. We agree that it is essential that stations are able
to upload public file documents, and particularly political files,
efficiently, and that the online public file should be able to handle
many stations uploading documents at the same time even during an
election season. We recognize problems stations have experienced
uploading the revised Form 323 and are working to fix those problems.
But we do not anticipate similar problems with respect to uploading the
public file. The delays in the Form 323 uploading process stem from the
time required in the current Form 323 filing application to validate
the large spreadsheets that must be filed with Form 323, and the
validation queuing process. Public file documentation will not be
subject to the validation process that is required for the Form 323
spreadsheets, nor will we need to impose a similar queuing system
necessitated by the validation process. Furthermore, Form 323 was
launched and run on existing FCC infrastructure. Since then, the
Commission has begun utilizing scalable cloud-based IT architecture
solutions to enhance the agency's capabilities. In particular, the
Commission anticipates using for online public files the same scalable
architecture that currently is being used successfully for the Customer
Proprietary Network Information certification document filing system
and the National Broadband Map.
92. Back-up Files. In lieu of requiring stations to maintain back-
up copies of all public file materials, as proposed in the FNPRM, the
Commission will generate copies of their online files. With respect to
the political file, however, we will require stations to maintain local
electronic back-up files to ensure that, in the event our online public
file were to become temporarily unavailable, they can comply with their
statutory obligation to make that information available to candidates,
their representatives, non-candidate political time buyers and the
public generally as soon as possible. To minimize any burden imposed by
this requirement, we have developed tools to allow stations to easily
copy mirrors of their online public files, which contain the political
files.
93. In the FNPRM, the Commission proposed that stations retain
electronic copies for back-up purposes of all public file items in the
event the Commission's online public file were to become unavailable or
disabled. The Commission also proposed that in such circumstances,
stations would have to make these back-up files available to the
public. We are persuaded by commenters, however, that requiring
stations to maintain back-up copies of all public file materials and to
make them routinely available directly to the public would reduce the
efficiencies of placing the public file online. These commenters
explain that such an approach would force stations to continue
maintaining a separate complete public file on site so as to comply
with the Commission's rules at a moment's notice.
94. To ensure that stations' public files are available even if the
Commission's online public file were to become temporarily unavailable
or in the event technical problems prevented broadcasters from
accessing the Commission's online file, we will create ``failover''
backups of the online public file, including mirroring daily snapshots
of the public file. That is, the Commission will make a mirror copy of
each station's public file records daily to ensure that if the data in
the online public file is compromised, the public files can be
reconstituted using the back-up copy. Thus, the Commission will relieve
stations of the burden of maintaining a back-up of the entire public
file locally. In addition, with the exception of the political file,
discussed below, will not make stations responsible for making
available to the public information from the public file in the event
the Commission's online files become temporarily inaccessible; the
mirroring approach will enable us to perform the back-up function
ourselves. Although we will not require stations to maintain back-up
copies of the public file, stations are free to maintain back-up
materials and to continue to make the public file available locally or
on their own Web site, in addition to on our Web site, if they choose
to do so. To the extent the public may experience a delay in accessing
the information due to the brief unavailability of the online file, we
consider that delay (with the exception of the political file), on
balance, to be acceptable in order not to burden broadcasters with the
necessity of making public file materials available to the public at
the station. If the Commission's online file becomes temporarily
inaccessible to stations for the uploading of new documents, however,
stations must maintain those documents and upload them to the online
file once it becomes available again for upload. The Commission will
also daily make the mirror copy of every station's public file
available for the station or other interested parties to download so
that, if they wish, they can periodically download a complete mirror of
their public file or automate a periodic synchronization.
95. As suggested in the FNPRM, we conclude that additional steps
should be taken to ensure that access to the political file is not
compromised. Accordingly, if the Commission's online public file were
to become temporarily unavailable, stations will be required to provide
any information pertaining to the political file not just to
candidates, their representatives and other political time buyers, but
directly to any member of the public as well. The benefits of making
such information available immediately outweigh the burdens of
maintaining this limited back-up requirement. Given the short seven-day
deadline for candidates to request equal opportunity appearances, it is
essential to candidates' exercise of their rights under the Act that
they have prompt access to political file information. Moreover,
limiting that access to candidates and their representatives would be
inconsistent with the Communications Act, which requires that political
file information shall be ``available for public inspection'' and
``placed in a political file as soon as possible.'' These requirements
do not distinguish between candidates and their representatives and
other members of the public. In addition, although only
[[Page 27650]]
candidates have rights to equal opportunities and lowest unit charge
under Section 315, other members of the public may also have time-
sensitive needs to access a station's political files. For example, a
sponsor of a political issue advertisement may have a significant
interest in ascertaining which candidates or other issue advertisement
sponsors have bought time at a station.
96. The Commission is taking all steps necessary to ensure that the
Commission-hosted online public file will not become unavailable, and
we expect instances of unavailability to be both rare and of short
duration. As a result, we do not expect the requirement to provide
back-up access to the political file during any times of outages to be
overly burdensome. In addition, we will allow stations to retain such
information in whatever form is most convenient for them. Our making
mirror copies of stations' public files available to stations, as
described above, will enable stations to comply with the political file
back-up requirement with little burden. That is, while not required,
stations may choose to meet the political file back-up requirement by
periodically downloading a mirror copy of the public file. When
choosing this option, stations will need to ensure that they retain any
political file records that have not been uploaded or were uploaded
after their last download of a mirror copy of their online public file.
This means that if a station decides to download a mirror copy of their
online public file on a weekly basis, it will need to maintain at the
station, in paper or electronic form, any documents that have not been
uploaded or that it uploaded to the online political file after its
last weekly download. If a station chooses to download a mirror copy of
their online public file on a monthly basis, it will need to maintain
at the station any documents that have not been uploaded or that it
uploaded to the online political file after its last monthly download.
If a station chooses not to download a mirror copy of their online
public file, and does not otherwise satisfy the back-up requirement, it
will need to maintain at the station all documents required to be in
its online political file. We stress that stations will only be
required to make these backups available if and during such time as the
Commission's online public file is unavailable, which we believe will
only happen in rare instances, such as national or localized
emergencies, because the Commission will follow necessary protocols for
creating failover backups of the online public file.
97. Compliance Dates. In order to facilitate a smooth transition to
the online public file, we will provide a phase-in period for stations
to begin uploading files. Stations will be required to begin using the
online public file after the effective date of this Order, which is 30
days after the Commission announces in the Federal Register that OMB
has completed its review under the Paperwork Reduction Act and approved
the collection.\9\ After the effective date, if a station determines
that any document must be placed in the public file, that document must
be posted to the online public file. We refer to this as the
requirement to post documents online ``on a going-forward basis.'' In
order to ensure that broadcasters have time to familiarize themselves
with the online public file, the Commission will make a version
available to the public soon after adoption of this item. We also
instruct the staff to help educate broadcasters about the online public
file and how it functions.
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\9\ Public Law 104-13. The Commission previously sought comment
on the paperwork burden associated with these proposals. See 76 FR
72144 (Nov. 22, 2011). Because the Order today substantially adopts
the item as proposed in the FNPRM, with the exception of a few
proposed collections that we are declining to impose, a 30 day
public comment cycle will be appropriate. 5 CFR 1320.11(h). The
Commission will publish a notice in the Federal Register regarding
the reduced paperwork burdens adopted in this Order. The OMB review
process will then commence.
---------------------------------------------------------------------------
98. To ensure that existing public file materials--that is, the
public file as it exists prior to the effective date--are uploaded to
the online public file in an orderly manner, we will give broadcasters
sufficient time to do so. Stations will be permitted to begin uploading
existing public file materials immediately after the effective date, at
the same time stations must also begin posting online documents on a
going-forward basis. Stations must complete the process of uploading
the existing public file within six months after the effective date,
i.e., six months after the Commission publishes a notice in the Federal
Register announcing OMB approval under the Paperwork Reduction Act. We
believe that giving stations six months to complete the upload of
existing files will provide broadcasters adequate time and flexibility
to undertake this process.
99. Accessibility for People with Disabilities. In the FNPRM, the
Commission stated that it intended to ensure that the online public
files, like the rest of the Commission's Web site, is accessible to
people with disabilities. Under Section 508 of the Rehabilitation Act,
federal agencies must ensure that members of the public who have
disabilities and who are seeking information or services from a federal
agency ``have access to and use of information and data that is
comparable to the access to and use of the information and data by such
members of the public who are not individuals with disabilities.'' For
federal agencies, including the Commission, this requires access by
people with disabilities to the agencies' Web sites, including
electronic filing systems, such as the Commission's ECFS. In the FNPRM,
we sought comment on whether further actions were necessary to ensure
compliance with respect to the online public file. No commenters raised
concern about this issue. To assure compliance, the Commission will
perform accessibility tests and address any known issues once the
online public file has been created. We believe that Commission
compliance with the requirements imposed by Section 508 of the
Rehabilitation Act will be sufficient to ensure that the online public
file is accessible to individuals with disabilities. If we learn of any
problems with accessibility of the online public file, we will revisit
this issue.
100. Geographic Coverage Area. The Commission's online public file
will be available to anyone who has Internet access, regardless of
their location. Two petitioners on reconsideration of the 2007 Report
and Order suggested that broadcasters should be permitted to limit
online public file access to viewers within a station's geographic
coverage area. The Commission concluded in the FNPRM that it saw no
reason to limit online access to the public file, nor did it know of a
workable mechanism for implementing and enforcing such a proposal. No
commenter opposed this tentative conclusion, and commenters in support
agreed that limiting access to a station's public file to viewers
within a station's viewing area would be misguided. We believe it
entirely consistent with Congressional intent in adopting Section 309
of the Act to enhance the ability of both those within and those beyond
a station's service area to participate in the licensing process. We
see no additional burdens, and several benefits, in providing full
access to the public file of each station. We note, moreover, that such
a restriction would reduce the scope of public access now provided by
our rules--a result clearly at odds with our objective of increasing
the transparency and availability of public records. We conclude that
each station's online public file will not be limited to viewers within
its geographic coverage area.
[[Page 27651]]
101. Maintenance. In order to keep each public file orderly, we
conclude that stations must actively maintain their online public file,
although the Commission will ensure that items filed in CDBS are
updated in the public file as they are updated on CDBS. In the FNPRM,
the Commission proposed that stations would be expected to maintain
their online public files, ensuring that the files contain the
information required by the public file rules and that items be removed
once they no longer must be retained under our rules.\10\ In response,
APTS and PBS argue that it would be more efficient for the Commission
automatically to replace old materials when new materials are imported
into the public file. They argue that it is inefficient and burdensome
for stations to be required to monitor the addition and deletion of
materials. They also argue that the Commission should avoid introducing
contradictory objectives by punishing stations for sharing information
above and beyond what is required while still expecting the stations to
increase disclosure so the public is informed of the station's
broadcast services.
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\10\ As required by the Federal Records Act, 44 U.S.C. 3301, et
seq., the Commission will create a records schedule to set the
retention and disposal of the files. The schedule will require
approval by the National Archives and Records Administration. The
records schedule will govern our handling of the station files.
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102. We believe it is important that stations maintain orderly
public files. While one of our goals is increased disclosure, another
is to be able to provide the public with relevant information in an
efficient manner. We are concerned that if material is never removed
from the online public file, it will be difficult for the public to
find information that is relevant. We note that public file items have
different document retention periods, and recommend that stations
remove such items in a timely fashion. We do not require stations to
remove each item at the end of its retention period, but note that
stations are still required to maintain an orderly file. Each station's
online public file should not become so overgrown with out-of-date
documents that it is difficult to access relevant materials. To assist
with this process, the Commission will strive to facilitate the
identification and management of aging materials. The Commission will
explore creating a mechanism to automatically identify documents that
may be beyond their retention period, and flag such documents for
station review. Some categories of documents, such as time brokerage
agreements and joint sales agreements that need to be retained for as
long as the items are effective, will need active management on the
part of the station. At a minimum, we will require stations to remove
expired contracts when and if replacement agreements are uploaded.
Materials in the online file will be disposed of consistent with the
records schedule we will develop under the Federal Records Act.
103. Certification. We decline the request of two parties that the
Commission remove a question on renewal Form 303-S that asks whether
local public file documents have ``been placed in the station's public
inspection file at the appropriate times.'' The two parties argue that
this certification will be unnecessary, since the online public file
will be available for anyone to evaluate for completeness. We disagree.
Although the Commission will be importing into the online public file
all items that are filed with the Commission in CDBS, stations will
still be responsible for uploading to the online public file all other
items required under our rules. In order to upload information into its
online public file, a station will need to log in with the same
credentials used to file station applications and materials in CDBS.
This will ensure that only station licensees will be able to post
information to their files. As there will still be a requirement that
stations maintain their public files, it is necessary that stations
certify to their compliance with this requirement at the time of
license renewal. This certification requirement is designed to promote
voluntary rule compliance. In addition, as noted in the FNPRM, a
successful upload of a station's public file on the Commission's Web
site will not be considered agency approval of the material contained
in the filing. The purpose of online hosting is to provide the public
ready access to the material, although Commission staff may review the
material placed in each station's online public file, just as
Commission staff currently reviews station public files to determine
compliance with Commission rules.
104. Working Group and Pilot Program. We decline to adopt NAB's
proposal that the Commission create a joint Commission-broadcaster
working group or a pilot program to address the implementation issues
and technical challenges raised by the online public file. NAB argues
that a working group, through which the Commission would work with
broadcasters to design the online public file and develop rules for its
use, would likely reduce overall costs and burdens for the Commission
and stations by identifying more quickly potential problems and their
solutions. NAB and others also support a pilot program, through which a
limited number of stations would test the online public file before the
Commission requires broadcast stations to post files to it. Named State
Broadcasters Association argues that a pilot program is an important
way for the Commission to meet its statutory obligations under the
Paperwork Reduction Act. We disagree with their argument that rules
implementing the Paperwork Reduction Act require the Commission to test
information collections a pilot program. These commenters argue that
the Commission will gain valuable experience and insight if it conducts
a pilot program involving the licensees of representative large,
medium, and small market commercial and noncommercial educational
television stations, and their trade association representatives. Other
implementation suggestions include transition periods, phase-in
approaches, and workshops.
105. For more than ten years the Commission has been exploring in
this proceeding the best way to move broadcasters' public files online
to make them more accessible. A broad group of commercial and
noncommercial broadcasters has participated in every phase of the
proceeding. We do not believe a working group or pilot program is
necessary to ensure that the process of implementing an online public
file is successful, and we believe that the creation of a working group
as a condition precedent could unduly delay its implementation. One
commenter claims that details of a ``pilot program'' were not properly
raised in the FNPRM. To the extent these notice concerns relate to the
phase-in approach we are adopting in this proceeding, we note that in
the FNPRM, the Commission sought comment on whether we should
``consider creating different requirements for small television
broadcasters.'' In any event, the Commission has discretion to
implement changes in a step-by-step fashion.
106. We are addressing the concerns expressed about implementation,
however. The Commission is undertaking rigorous testing of the online
public file to ensure a smooth user experience. We will provide
opportunities for user testing and education before stations are
required to upload their online public files. Because our rules will
require stations simply to upload information to a Commission-hosted
online public file, a process similar to uploading applications to
CDBS--which licensees have been
[[Page 27652]]
doing for more than ten years--we do not believe that this process
demands the kind of groundwork that broadcasters advocate. As already
discussed, only 200 stations, or approximately 11% of all stations,
will be required to upload their political files for the first two
years. While this is not a pilot program, we believe that this smaller
group of stations, which as major-network affiliates are generally
likely to be relatively capable and sophisticated users of technology,
can assist in meeting NAB's stated goals of addressing implementation
issues and technical challenges as they arise. In addition, as
discussed above, we believe that the user testing and education we will
provide will assist stations with any concerns they may have.
Commission staff will be dedicated to assisting stations with any
issues they may confront after implementation of the online public
file. We will also explore the option of providing user or peer support
groups to help stations identify and work through implementation
issues. Such support groups can assist the Commission in identifying
whether any issues are common to many users, or station-specific.
F. Announcements and Links
107. We decline to adopt the FNPRM's proposal to require stations
to make on-air announcements about the availability of the online
public file, but do adopt the proposal that stations provide
information about the online public file on their Web sites to the
extent that they have them. In the 2007 Report and Order, the
Commission adopted a requirement that stations make twice-daily
announcements about the online availability of the public file. On
reconsideration, public television petitioners argued that this was
unduly burdensome, and asked that the Commission reduce this
requirement to a few times a week, at most. In the FNPRM, the
Commission proposed that stations be required to notify viewers of the
existence, location, and accessibility of a station's public file; it
noted that if most viewers are unaware of the existence of the public
file or how to access it, its usefulness would be greatly diminished.
108. The Commission has long required stations to identify both the
call letters of their stations and the cities which they are primarily
licensed to serve in order to enable the public to readily ``identify
the stations to which they are listening and, further, to identify the
communities which they are primarily licensed to serve.'' APTS and PBS
argue that stations should have the option of making announcements
regarding the online public file on their Web sites without having to
also make an on-air announcement. APTS and PBS argue that on-air
announcements are ineffective in informing the public because they are
fleeting and might not reach all individuals within the community,
whereas a notice on the station's Web site is more likely to be found
by persons who are interested in accessing an online public file and
can provide more detail. We are persuaded that providing information on
a station's Web site about the existence and location of the online
public file is a better means of ensuring that all viewers know about
the availability of the online public file than requiring occasional
on-air announcements. Stations will, however be required to revise
their on-air pre- and post-filing renewal announcements to reflect the
availability of a station's renewal application on the Commission's Web
site, as reflected in Appendix A of the Second Report and Order.
109. We adopt the tentative conclusion that stations that have Web
sites be required to place a link to the online public file on their
home page. Common Frequency supports the proposal, and no commenter
opposed it. Although we have concluded that posting station information
to an online public file hosted by the Commission will make the
information easily accessible by viewers, we want to ensure that those
viewers who seek such information on a station's Web site are directed
to the online public file, particularly since stations will not be
required to broadcast on-air announcements regarding the change in
location of their public file. In lieu of requiring stations to
announce on their Web sites the availability of their correspondence
files at their main studios, we will include language in the online
public file that directs the public to the station's main studio to
access letters and email from the public.
110. We also adopt the FNPRM's proposed requirement that stations
that have Web sites include on their home page contact information for
a station representative that can assist any person with disabilities
with issues related to the content of the public files. We note that if
stations receive comments about the accessibility of the online public
file system, it should direct those questions and concerns to the
Commission. PIPAC noted that for a person with disabilities, ``the
burden of searching through several pages or levels becomes an
insurmountable barrier.'' We will adopt the proposal, which no
commenter opposed.
G. Radio and Multichannel Video Programming Distributors
111. Consistent with the FNPRM, we limit this proceeding to
television stations at this time. In the FNPRM, the Commission noted
that this proceeding is directed toward television broadcasters, and
that we may require radio licensees to abide by similar public file
reforms at a later date. LUC Media Group asks that the Commission
consider requiring radio and cable systems to also maintain an online
public file. We disagree that we should extend the online public file
rules to radio and cable systems (or other multichannel video
programming distributors (``MVPDs'')) at this time. First, because this
proceeding has long focused only on television stations, we do not have
a sufficient record concerning radio stations or MVPDs on which to
consider possible new rules for those entities. Second, as discussed in
the FNPRM, we anticipate that starting the online public file process
with the much smaller number of television licensees, rather than with
all broadcasters and MVPDs, will ease the initial implementation of the
online public file.\11\
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\11\ We reject arguments that requiring television broadcasters
to place their political files online will put them at a
disadvantage with respect to competitors, such as MVPDs and radio
stations. As discussed above, to the extent competitors and
potential advertisers have an economic incentive to access this
information, they can already do so at the station; the online
disclosure rule will not alter the economic incentives of these
entities in any meaningful way. In any event, the Commission has
discretion to implement changes in a multistep fashion. We further
note that 75% of political advertising is spent on broadcast
television, thus demonstrating a preference by media buyers to
utilize broadcast television over other forms of available media to
reach voters or customers. There is no evidence in the record to
suggest that such advertising would shift to other forms of media
simply because rate information, already public, will now be
accessible online.
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112. Public TV Licensees asks that we allow NCE radio stations, or
at least those that are licensed to the same entity as, or under common
control with, an NCE television station, to maintain their public
inspection files online on the Commission's Web site on a voluntary
basis. Public Television Licensees argues that this will allow radio
stations that are jointly owned or operated with television stations to
avoid duplicative efforts from having to maintain two separate public
file systems, involving some of the same documents. It notes that with
respect to the NCE rules, all of the requirements for radio stations
are being included in the proposed online public file. We appreciate
that commonly owned and operated radio stations may prefer an
[[Page 27653]]
early transition to the online public file. In this initial phase of
implementing the online public file, however, we are concerned about
adding a significant number of additional entities to the universe of
users. As we and the broadcasting industry gain more experience with
the online public file we will revisit the possibility of allowing
stations not required to use the online public file to use it on a
voluntary basis. We delegate to Commission staff the authority to allow
(but not require) radio stations to voluntarily post their public files
at such time as staff determines that such an option is feasible and
desirable; this will ensure that radio stations wishing to avail
themselves of the online public file can do so promptly. We further
authorize Commission staff to take into account common-ownership
considerations if appropriate.
IV. Procedural Matters
A. Regulatory Flexibility Analysis
113. As required by the Regulatory Flexibility Act (``RFA''), an
Initial Regulatory Flexibility Analysis (``IRFA'') was incorporated in
the Order on Reconsideration and Further Notice of Proposed Rulemaking
(Further Notice) in MB Docket 00-168. The Commission sought written
public comment on the proposals in the Further Notice, including
comment on the IRFA. We received comments from the North Carolina
Association of Broadcasters et al. specifically directed toward the
IRFA. These comments are discussed below. This Final Regulatory
Flexibility Analysis (FRFA) conforms to the RFA.
Need for, and Objectives of, the Second Report and Order
114. One of a television broadcaster's fundamental public interest
obligations is to air programming responsive to the needs and interests
of its community of license. Broadcasters are afforded considerable
flexibility in how they meet that obligation. Among other things, they
are required to maintain a public inspection file, which gives the
public access to information about the station's operations. The goal
of this Second Report and Order is to modernize this public inspection
file requirement, making the public file information more accessible to
members of the public who cannot visit a station during business hours
to review the public file.
115. The Second Report and Order adopts rule changes that will:
Replace the requirement that television stations maintain
a paper public file at their main studios with a requirement to submit
documents for inclusion in an online public file, including the
political file, to be hosted by the Commission;
Reduce the number of documents that television stations
would be required to upload to an online public file, by automatically
linking to information already collected by the Commission;
Streamline the information required to be kept in the
online file, such as by excluding letters and emails from the public;
and
Give the online public file a uniform organizational
structure to allow consumers to more easily navigate the public files.
Legal Basis
116. The proposed action is authorized pursuant to Sections 1, 2,
4(i), 303, and 405 of the Communications Act, 47 U.S.C. 151, 152,
154(i), 303, and 405.
Summary of Significant Issues Raised by Public Comments in Response to
the IRFA
117. In the IRFA, we stated that our purpose was to ensure that any
changes to applicable rules would impose only minimal adverse impact on
small entities. We also solicited comments on alternatives to the
proposed rules that would minimize the impact that any changes to our
rules might have on small entities. In their comments, North Carolina
Association of Broadcasters et al. states that the IRFA has not ``fully
acknowledged, much less actually considered and developed any data to
evaluate, the economic impacts of its proposals to require broadcasters
to upload their political files to the FCC's servers and to require
broadcasters to report all sponsorship identifications in the online
public file.'' The North Carolina Association of Broadcasters et al.
also states that ``the Commission has underestimated the burden of
creating, updating, and maintaining these materials'', and has not
analyzed the costs to the Commission, which it claims will
``undoubtedly'' be bourn by small businesses via increased regulatory
fees.
118. We disagree with these claims. The FNPRM and Second Report and
Order, including the IRFA and this FRFA, consider the impacts of this
revised recordkeeping requirement. Section III.B. of the Second Report
and Order discusses how broadcasters' initial costs of compliance are
minimized, and how the online public file will ultimately lead to cost
savings. This section discusses the Commission's cost analysis,
including our determination that broadcaster's initial costs of
compliance to upload their existing public file will average from $80
to $400 per station. We understand that North Carolina Association of
Broadcasters et al. disagrees with our evaluation of the burdens that
will be placed upon broadcasters in order to comply with these revised
recordkeeping requirements as discussed in the FNPRM. Those arguments
are considered in this Second Report and Order. We also disagree with
North Carolina Association of Broadcasters et al.'s assertion that this
Regulatory Flexibility Analysis must more fully consider costs to the
Commission. We find that such a claim by the Association is based on
purely speculative, and therefore spurious, grounds. In making the
determinations reflected in the Second Report and Order, we have
considered the impact of our actions on small entities, which is the
requirement of the Regulatory Flexibility Act. In any event, the
Commission is taking steps in this Second Report and Order to minimize
burdens on small entities, by undertaking the automatic posting of
several items that are required to be placed in the online public file,
as discussed in Section E, supra. In addition, the Commission declined
to adopt the proposal that stations report all sponsorship
identifications, as discussed by the North Carolina Association of
Broadcasters, and shared services agreements, along with weekly on-air
announcements. Also, the Commission is providing an exemption from
uploading the political file to all stations that are not in the top 50
DMAs and all stations not affiliated with the top four national
television broadcast networks, regardless of the size of the market
they serve, until July 1, 2014. This will enable small market and non-
affiliated broadcasters to have two additional years to familiarize
themselves with the online filing requirements before they need to
begin uploading their political files on a going-forward basis.
Description and Estimate of the Number of Small Entities to Which the
Proposed Rules Will Apply
119. The 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
[[Page 27654]]
``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. Below, we provide a description of such small
entities, as well as an estimate of the number of such small entities,
where feasible.
120. Television Broadcasting. The SBA defines a television
broadcasting station as a small business if such station has no more
than $14.0 million in annual receipts. Business concerns included in
this industry are those ``primarily engaged in broadcasting images
together with sound.'' The Commission has estimated the number of
licensed commercial television stations to be 1,390. According to
Commission staff review of the BIA Kelsey Inc. Media Access Pro
Television Database (BIA) as of January 31, 2011, 1,006 (or about 78
percent) of an estimated 1,298 commercial television stations in the
United States have revenues of $14 million or less and, thus, qualify
as small entities under the SBA definition. The Commission has
estimated the number of licensed noncommercial educational (``NCE'')
television stations to be 391. We note, however, that, in assessing
whether a business concern qualifies as small under the above
definition, business (control) affiliations must be included. Our
estimate, therefore, likely overstates the number of small entities
that might be affected by our action, because the revenue figure on
which it is based does not include or aggregate revenues from
affiliated companies. The Commission 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.
121. In addition, an element of the definition of ``small
business'' is that the entity not be dominant in its field of
operation. We are unable at this time to define or quantify the
criteria that would establish whether a specific television station is
dominant in its field of operation. Accordingly, the estimate of small
businesses to which rules may apply do not exclude any television
station from the definition of a small business on this basis and are
therefore over-inclusive to that extent. Also, as noted, an additional
element of the definition of ``small business'' is that the entity must
be independently owned and operated. We note that it is difficult at
times to assess these criteria in the context of media entities and our
estimates of small businesses to which they apply may be over-inclusive
to this extent.
Description of Projected Reporting, Recordkeeping, and Other Compliance
Requirements
122. The rule changes adopted in the Second Report and Order affect
reporting, recordkeeping, or other compliance requirements. Television
broadcasters are currently required to maintain a copy of their public
inspection files at their main studios. The Second Report and Order
requires stations to replace that requirement with a requirement to
submit documents for inclusion in an online public file, including the
political file, to be hosted on the Commission's Web site. Items in the
public file that must also be filed with the Commission, including FCC
authorizations, applications and related materials, contour maps,
ownership reports and related materials, portions of the equal
employment opportunity file, the public and broadcasting manual,
children's television programming reports (Form 398), and DTV
transition education reports (Form 388), will be automatically imported
into the station's online public file. Television stations will only be
responsible for uploading and maintaining items that are not required
to be filed with the Commission under any other rule. The Second Report
and Order also excludes some items from the online public file
requirement, such as the existing political file and letters and emails
from the public, which will continue to be maintained at the station,
and also declines to add other items to the online public file
requirement, including sponsorship identifications and shared services
agreements, and weekly announcements of the existence of the public
file.
Steps Taken To Minimize Significant Economic Impact on Small Entities,
and Significant Alternatives Considered
123. 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.
124. The Second Report and Order seeks to minimize and modernize
reporting requirements on all television broadcasters, by having the
Commission host the online public file. The previous Report and Order
in this proceeding, which has been vacated, required stations to host
their own public file. Having the Commission host the public file will
ease the administrative burdens on all broadcasters. More than one-
third of the required contents of the public file already have to be
filed with the Commission, and the Second Report and Order requires the
Commission to import and update that information, creating efficiencies
for broadcasters. North Carolina Association of Broadcasters et al.
note that the estimate for the proportion of the public file that is
already filed with the Commission is based on categories of filings,
and not the overall amount of paperwork that needs to be filed.
125. Given the wide variations of most public files, we are not
able to estimate the precise decrease in burdens that each station will
undergo by no longer being responsible for placing in the public file
items that are already filed by the Commission. But regardless whether
the decrease in burdens is measured by category or by overall amount of
paperwork, every station will have its burdens reduced by eliminating
this duplicative requirement. We also understand that all stations will
have an increased burden for the initial transition period from the
paper public file to an online public file. We do not believe that this
effort will be unduly burdensome on small entities, and we believe that
any such burdens are trumped by the increased efficiencies that will
result from such a transition.
126. In any event, the Second Report and Order does not require any
station to upload its existing political files, instead allowing
stations to retain such materials at the station until those files
expire after their two year retention period. All stations will only be
required to upload political file material on a going-forward basis. In
addition, the Commission is exempting all stations that are not in the
top 50 DMAs and all stations not affiliated with the top four national
television broadcast networks, regardless of the size of the market
they serve, from having to post new political file materials online
until July 1, 2014 from including their political file material in the
online public file. After that date, those stations will be required to
upload new political file material on a going-forward basis. This will
enable non-affiliated broadcasters and smaller market broadcasters to
have additional time to
[[Page 27655]]
familiarize themselves with the online filing requirements before they
need to begin uploading their political files.
127. Overall, in proposing rules governing an online public file
requirement, we believe that we have appropriately balanced the
interests of the public against the interests of the entities who will
be subject to the rules, including those that are smaller entities.
Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rule
128. None.
B. Paperwork Reduction Act Analysis
129. This document contains proposed information collection
requirements. 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, as required by the Paperwork
Reduction Act of 1995.\12\ The Commission previously sought comment on
how we might further reduce the information collection burden for small
business concerns with fewer than 25 or fewer employees.
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\12\ Public Law 104-13. The Commission previously sought comment
on these proposals. See 76 FR 72144 (Nov. 22, 2011).
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130. The Commission will send a copy of this Second Report and
Order to Congress and the Government Accountability Office pursuant to
the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).
V. Ordering Clauses
131. Accordingly, It is ordered that, pursuant to the authority
contained in sections 1, 2, 4(i), 303, 307, and 315 of the
Communications Act, 47 U.S.C. 151, 152, 154(i), 303, 307, 315, this
Second Report and Order is adopted.
132. It is further ordered that the requirement that stations place
their new public inspection file documents on the Commission-hosted
online public file shall be effective 30 days after the Commission
publishes a notice in the Federal Register announcing OMB approval.
Stations will be responsible for placing existing public file documents
into the Commission-hosted online public file, with the exception of
letters and emails from the public and the existing political file, as
required by this Second Report and Order, within six months after the
Commission publishes a notice in the Federal Register announcing OMB
approval. Until July 1, 2014, stations not in the top 50 DMAs and all
stations not affiliated with the top four networks, regardless of the
size of the market they serve, are exempt from the requirement, under
47 CFR 73.3526(b)(3) and 73.3527(b)(3), of filing their political file
online.
133. It is further ordered that the proceeding in MM Docket No. 00-
44 is terminated.
134. It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, SHALL SEND a
copy of this Second Report and Order, including the Final Regulatory
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small
Business Administration.
List of Subjects in 47 CFR Part 73
Television broadcasting.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
Final Rules
For the reasons stated in the preamble, the Federal Communications
Commission amends 47 CFR part 73 as follows:
PART 73--RADIO BROADCAST SERVICES
0
1. The Authority citation for Part 73 continues to read as follows:
Authority: 47 U.S.C. 154, 303, 307, and 554.
0
2. Amend Sec. 73.1212 by revising paragraph (e) to read as follows:
Sec. 73.1212 Sponsorship identification; list retention; related
requirements.
* * * * *
(e) The announcement required by this section shall, in addition to
stating the fact that the broadcast matter was sponsored, paid for or
furnished, fully and fairly disclose the true identity of the person or
persons, or corporation, committee, association or other unincorporated
group, or other entity by whom or on whose behalf such payment is made
or promised, or from whom or on whose behalf such services or other
valuable consideration is received, or by whom the material or services
referred to in paragraph (d) of this section are furnished. Where an
agent or other person or entity contracts or otherwise makes
arrangements with a station on behalf of another, and such fact is
known or by the exercise of reasonable diligence, as specified in
paragraph (b) of this section, could be known to the station, the
announcement shall disclose the identity of the person or persons or
entity on whose behalf such agent is acting instead of the name of such
agent. Where the material broadcast is political matter or matter
involving the discussion of a controversial issue of public importance
and a corporation, committee, association or other unincorporated
group, or other entity is paying for or furnishing the broadcast
matter, the station shall, in addition to making the announcement
required by this section, require that a list of the chief executive
officers or members of the executive committee or of the board of
directors of the corporation, committee, association or other
unincorporated group, or other entity shall be made available for
public inspection at the location specified under Sec. 73.3526. If the
broadcast is originated by a network, the list may, instead, be
retained at the headquarters office of the network or at the location
where the originating station maintains its public inspection file
under Sec. 73.3526. Such lists shall be kept and made available for a
period of two years.
* * * * *
0
3. Amend Sec. 73.1943 by adding paragraph (d) to read as follows:
Sec. 73.1943 Political file.
* * * * *
(d) Location of the file. A television station licensee or
applicant must post all of the contents added to its political file
after the effective date of this paragraph in the political file
component of its public file on the Commission's Web site. A television
station must retain in its political file maintained at the station, at
the location specified in Sec. Sec. 73.3526(b) or 73.3527(b), all
material required to be included in the political file and added to the
file prior to the effective date of this paragraph. The online
political file must be updated in the same manner as paragraph (c) of
this section.
0
4. Amend Sec. 73.3526 by revising paragraph (b) to read as follows:
Sec. 73.3526 Local public inspection file of commercial stations.
* * * * *
(b) Location of the file. The public inspection file shall be
located as follows:
(1) For radio licensees, a hard copy of the public inspection file
shall be maintained at the main studio of the station. For television
licensees, letters and emails from the public, as required by paragraph
(e)(9) of this section, shall be maintained at the main studio of the
station. An applicant for a new station or change of community shall
maintain its file at an accessible place in the
[[Page 27656]]
proposed community of license or at its proposed main studio.
(2) A television station licensee or applicant shall place the
contents required by paragraph (e) of this section of its public
inspection file on the Commission's Web site, with the exception of
letters and emails from the public as required by paragraph (e)(9) of
this section, which shall be retained at the station in the manner
discussed in paragraph (b)(1) of this section; and the political file
as required by paragraph (e)(6) of this section, as discussed in
paragraph (b)(3) of this section. A station must provide a link to the
public inspection file hosted on the Commission's Web site from the
home page of its own Web site, if the station has a Web site, and
provide contact information on its Web site for a station
representative that can assist any person with disabilities with issues
related to the content of the public files. A station also is required
to include in the online public file the station's main studio address
and telephone number, and the email address of the station's designated
contact for questions about the public file. To the extent this section
refers to the local public inspection file, it refers to the public
file of an individual station, which is either maintained at the
station or on the Commission's Web site, depending upon where the
documents are required to be maintained under the Commission's rules.
(3) A television station licensee or applicant shall place the
contents required by paragraph (e)(6) of this section of its political
inspection file on the Commission's Web site. Political inspection file
material in existence 30 days after the effective date of this
provision shall continue to be retained at the station in the manner
discussed in paragraph (b)(1) of this section until the end of its
retention period. Any station not in the top 50 DMAs, and any station
not affiliated with one of the top four broadcast networks, regardless
of the size of the market it serves, shall continue to retain the
political file at the station in the manner discussed in paragraph
(b)(1) of this section until July 1, 2014. For these stations,
effective July 1, 2014, any new political file material shall be placed
on the Commission's Web site, while the material in the political file
as of July 1, 2014, if not placed on the Commission's Web site, shall
continue to be retained at the station in the manner discussed in
paragraph (b)(1) of this section until the end of its retention period.
However, any station that is not required to place its political file
on the Commission's Web site before July 1, 2014 may choose to do so,
instead of retaining the political file at the station in the manner
discussed in paragraph (b)(1) of this section.
(4) The Commission will automatically link the following items to
the electronic version of all licensee and applicant public inspection
files, to the extent that the Commission has these items
electronically: authorizations, applications, contour maps; ownership
reports and related materials; portions of the Equal Employment
Opportunity file held by the Commission; ``The Public and
Broadcasting''; Letters of Inquiry and other investigative information
requests from the Commission, unless otherwise directed by the inquiry
itself; Children's television programming reports; and DTV transition
education reports. In the event that the online public file does not
reflect such required information, the licensee will be responsible for
posting such material.
* * * * *
0
5. Amend Sec. 73.3527 by revising paragraph (b) to read as follows:
Sec. 73.3527 Local public inspection file of noncommercial
educational stations.
* * * * *
(b) Location of the file. The public inspection file shall be
located as follows:
(1) For radio licensees, a hard copy of the public inspection file
shall be maintained at the main studio of the station. An applicant for
a new station or change of community shall maintain its file at an
accessible place in the proposed community of license or at its
proposed main studio.
(2) A noncommercial educational television station licensee or
applicant shall place the contents required by paragraph (e) of this
section of its public inspection file on the Commission's Web site,
with the exception of the political file as required by paragraph
(e)(5) of this section, which may be retained at the station in the
manner discussed in paragraph (b)(1) of this section until July 1,
2014. Effective July 1, 2014, any new political file material shall be
placed on the Commission's Web site, while the material in the
political file as of July 1, 2014, if not placed on the Commission's
Web site, shall continue to be retained at the station in the manner
discussed in paragraph (b)(1) of this section until the end of its
retention period. However, any noncommercial educational station that
is not required to place its political file on the Commission's Web
site before July 1, 2014 may choose to do so instead of retaining the
political file at the station in the manner discussed in paragraph
(b)(1) of this section. A station must provide a link to the public
inspection file hosted on the Commission's Web site from the home page
of its own Web site, if the station has a Web site, and provide contact
information for a station representative on its Web site that can
assist any person with disabilities with issues related to the content
of the public files. A station also is required to include in the
online public file the station's main studio address and telephone
number, and the email address of the station's designated contact for
questions about the public file. To the extent this section refers to
the local public inspection file, it refers to the public file of an
individual station, which is either maintained at the station or on the
Commission's Web site, depending upon where the documents are required
to be maintained under the Commission's rules.
(3) The Commission will automatically link the following items to
the electronic version of all licensee and applicant public inspection
files, to the extent that the Commission has these items
electronically: Authorizations; applications; contour maps; ownership
reports and related materials; portions of the Equal Employment
Opportunity file held by the Commission; and ``The Public and
Broadcasting''.
* * * * *
0
6. Amend Sec. 73.3580 by revising paragraphs (d)(4)(i) introductory
text and script and (d)(4)(ii) introductory text and script to read as
follows:
Sec. 73.3580 Local public notice of filing of broadcast applications.
* * * * *
(d) * * *
(4) * * *
(i) Pre-filing announcements. During the period and beginning on
the first day of the sixth calendar month prior to the expiration of
the license, and continuing to the date on which the application is
filed, the following announcement shall be broadcast on the 1st and
16th day of each calendar month. Stations broadcasting primarily in a
foreign language should broadcast the announcements in that language.
Radio announcement: On (date of last renewal grant) (Station's call
letters) was granted a license by the Federal Communications Commission
to serve the public interest as a public trustee until (expiration
date).
Our license will expire on (date). We must file an application for
renewal with the FCC (date four calendar months prior to expiration
date). When filed, a copy of this application will be
[[Page 27657]]
available for public inspection during our regular business hours. It
contains information concerning this station's performance during the
last (period of time covered by the application). Individuals who wish
to advise the FCC of facts relating to our renewal application and to
whether this station has operated in the public interest should file
comments and petitions with the FCC by (date first day of last full
calendar month prior to the month of expiration).
Further information concerning the FCC's broadcast license renewal
process is available at (address of location of the station's public
inspection file) or may be obtained from the FCC, Washington, DC 20554.
Television announcement: On (date of last renewal grant) (Station's
call letters) was granted a license by the Federal Communications
Commission to serve the public interest as a public trustee until
(expiration date).
Our license will expire on (date). We must file an application for
renewal with the FCC (date four calendar months prior to expiration
date). When filed, a copy of this application will be available for
public inspection at www.fcc.gov. It contains information concerning
this station's performance during the last (period of time covered by
the application).
Individuals who wish to advise the FCC of facts relating to our
renewal application and to whether this station has operated in the
public interest should file comments and petitions with the FCC by
(date first day of last full calendar month prior to the month of
expiration).
Further information concerning the FCC's broadcast license renewal
process is available at (address of location of the station) or may be
obtained from the FCC, Washington, DC 20554.
* * * * *
(ii) Post-filing announcements. During the period beginning on the
date on which the renewal application is filed to the sixteenth day of
the next to last full calendar month prior to the expiration of the
license, all applications for renewal of broadcast station licenses
shall broadcast the following announcement on the 1st and 16th day of
each calendar month. Stations broadcasting primarily in a foreign
language should broadcast the announcements in that language.
Television announcement: On (date of last renewal grant) (Station's
call letters) was granted a license by the Federal Communications
Commission to serve the public interest as a public trustee until
(expiration date).
Our license will expire on (date). We have filed an application for
renewal with the FCC.
A copy of this application is available for public inspection at
www.fcc.gov. It contains information concerning this station's
performance during the last (period of time covered by application).
Individuals who wish to advise the FCC of facts relating to our
renewal application and to whether this station has operated in the
public interest should file comments and petitions with the FCC by
(date first day of last full calendar month prior to the month of
expiration).
Further information concerning the FCC's broadcast license renewal
process is available at (address of location of the station) or may be
obtained from the FCC, Washington, DC 20554.
Radio announcement: On (date of last renewal grant) (Station's call
letters) was granted a license by the Federal Communications Commission
to serve the public interest as a public trustee until (expiration
date).
Our license will expire on (date). We have filed an application for
renewal with the FCC.
A copy of this application is available for public inspection
during our regular business hours. It contains information concerning
this station's performance during the last (period of time covered by
application).
Individuals who wish to advise the FCC of facts relating to our
renewal application and to whether this station has operated in the
public interest should file comments and petitions with the FCC by
(date first day of last full calendar month prior to the month of
expiration).
Further information concerning the FCC's broadcast license renewal
process is available at (address of location of the station's public
inspection file) or may be obtained from the FCC, Washington, DC 20554.
* * * * *
[FR Doc. 2012-11065 Filed 5-10-12; 8:45 am]
BILLING CODE 6712-01-P