FORUM COMMUNICATIONS, INC.,
Docket No. 18711 File No. BRCT-98; Docket No. 18712 File No. BPCT-4249
FEDERAL COMMUNICATIONS COMMISSION
20 F.C.C.2d 298 (1969)
RELEASE-NUMBER: FCC 69-1162
October 22, 1969 Adopted
BY THE COMMISSION: COMMISSIONER BARTLEY CONCURRING AND ISSUING A STATEMENT IN WHICH COMMISSIONER JOHNSON JOINS; COMMISSIONER ROBERT E. LEE CONCURRING IN THE RESULT.
[*298] 1. The Commission has before it for consideration: (a) The application (BRCT-98) of WPIX, Inc. (WPIX), for renewal of its license to operate on channel 11, New York, N.Y.; (b) the application (BPCT-4249) of Forum Communications, Inc. (Forum), for a construction permit for a new television broadcast station to operate on channel 11, New York, N.Y., and its request for waiver of section 73.610(b) of the Commission's rules; and (c) objections filed by The Association of Maximum Service Telecasters, Inc. (AMST), directed against (b) above.
2. Forum proposes to locate its transmitter
[*299] 3. Based on the information contained in Forum's application, at least $3,316,537 will be needed for the construction and first 3 months cost of operation of the proposed station, consisting of downpayment on equipment -- $315,000; payments for 9 months on equipment including interest -- $334,687; buildings -- $250,000; other items -- $118,500; and 3 months cost of operations -- $2,298,350. Since the Commission's TV Broadcast Financial Data Report for 1968 reveals that the New York City television broadcast stations generated revenues on an average in excess of the applicant's anticipated first-year operating costs ($9,193,400), the cash needed figure has been computed on the basis of requiring that the applicant demonstrate the availability of cash to meet the first 3 months operating costs until the previously established revenues can be generated.
4. To meet the cash needed requirements, the
applicant relies upon the availability of $1,100,000 in stock subscription
agreements and a $2 million bank loan from the Bank of Commerce,
n1 It should be noted that the breakdown of first-year operating expenses submitted by the applicant provides for the first-year repayment of $160,000 in interest on the bank loan. Moreover, while the bank loan provides that the bank will defer repayment of principal during the first 3 months of the station's operation, the cash needed figure must be increased by the amount of any principal repayments made during the remaining portion of the first-year of operation.
5. Information before the Commission including the Commission's field inquiry into the operation of television broadcast station WPIX raises a number of questions regarding WPIX, Inc.'s news operation and its control and supervision thereof. Accordingly, appropriate issues have been specified and we have provided that the Chief, Broadcast Bureau shall serve upon the above-captioned applicants, within 20 days of the release of this order, a bill of particulars setting forth the basis for these issues.
6. In Suburban Broadcasters, 30 F.C.C. 1020, 20 R.R. 951 (1961); our "Public Notice" of August 22, 1968 ( F.C.C. 68-847, 13 R.R. 2d 1903); and City of Camden (WCAM), 18 F.C.C. 2d 412 (1969), we indicated that applicants were expected to provide full information on their awareness of and responsiveness to local community needs and interests. While we find that Forum has satisfactorily complied with these requirements, WPIX has not shown that it has contacted a representative cross-section of the community or that it has adequately listed the suggestions received regarding community needs. Consequently, it is not clear whether the programs proposed by WPIX are responsive to community needs. Accordingly, a programing issue will be specified.
7. Except as indicated by the issues set forth below, WPIX, Inc., is qualified to own and operate television broadcast station WPIX and except as indicated by the issues set forth below, Forum Communications, Inc., is qualified to construct, own and operate the proposed new television broadcast station. The applications are, however, mutually exclusive in that operation by the applicants as proposed would result in mutually destructive interference. The Commission is, therefore, unable to make the statutory finding that a grant of the applications would serve the public interest, convenience and necessity, and is of the opinion that they must be designated for hearing in a consolidated proceeding on the issues set forth below.
8. It is ordered, That, pursuant to section 309(e) of the Communications Act of 1934, as amended, the above-captioned applications of WPIX, Inc., and Forum Communications, Inc., Are designated for hearing in a consolidated proceeding at a time and place to be specified in a subsequent Order, upon the following issues:
1. To determine with respect to the application of WPIX, Inc.:
(a) Whether the licensee or any of its employees distorted, falsified or misrepresented news.
(b) In view of the facts ascertained under issue (a), whether WPIX, Inc., has demonstrated sufficient knowledge, control or supervision of its news operation.
(c) What actions WPIX, Inc., took to exercise control or supervision of its news operation subsequent to the disclosure of the facts ascertained and relevant to issue (a).
(d) Whether in light of the evidence adduced pursuant to the foregoing issues, WPIX, Inc., is disqualified to remain [*301] a licesee of the Commission or if not so disqualified, whether a comparative demerit or demerits should be assessed against it in this proceeding.
(e) The efforts made by WPIX, Inc., to ascertain the community needs and interests of the area to be served and the means by which it proposes to meet those needs and interests.
2. To determine with respect to the application of Forum Communications, Inc.:
(a) Whether Ronnie Myers Eldridge, Irwin Sonny Fox, and Lawrence K. Grossman have available liquid and current assets (as defined in sec. III, par. 4(d), F.C.C. Form 301) in excess of current liabilities in sufficient amounts to meet the remainder of their respective stock subscription commitments to the applicant.
(b) Whether Arthur D. Leidesdorf, Elmer Engel, and James Marshall have available liquid and current assets (as defined in sec. III, par. 4(d)) in excess of current liabilities in sufficient amounts to meet their respective stock subscription commitments to the applicant.
(c) The terms of repayment of principal and the nature of the security in connection with the $2 million loan from the Bank of Commerce.
(d) In view of the evidence adduced under issue (c), the extent, if any, to which the applicant's cash requirements will ba increased.
(e) Assuming that all of the funds upon which the applicant relies will be available to it, how the applicant will obtain sufficient additional funds to be used for the construction and first 3 months operation of the station.
(f) Whether, in view of the evidence adduced under the preceding issues, the applicant is financially qualified.
3. To determine which of the proposals would better serve the public interest.
4. To determine, in light of the evidence adduced pursuant to the above issues, which, if either, of that applications should be granted.
9. It is further ordered, That, in the event of a grant of the application of Forum Communications, Inc., the applicant's request for waiver of section 73.610(b) of the Commission's rules Shall be granted.
10. It is further ordered, That, the Chief, Broadcast Bureau is directed to serve upon the above-captioned parties, within 20 days of the release of this order, a bill of particulars setting forth the basis for the adoption of the above hearing issues 1(a) through
11. It is further ordered, That the Broadcast Bureau shall proceed with the initial introduction fo evidence with respect to issues 1(a) through 1(c) and that WPIX, Inc., shall have the burden of proof with respect to issues 1(a) through 1(d).
12. It is further ordered, That WPIX, Inc., shall have the burden of proceeding with the introduction of evidence and the burden of proof with respect to issue 1(e), and that Forum Communications, Inc., shall have the burden of proceeding with the introduction of [*302] evidence and the burden of proof with respect to issues 2(a) through 2(f).
13. It is further ordered, That, to avail themselves of the opportunity to be heard, the applicants pursuant to section 1.221(c) of the Commission's rules, in person or by attorney, shall, within 20 days of the mailing of this order, file with the Commission, in triplicate, a written appearance stating an intention to appear on the date fixed for the hearing and present evidence on the issues specified in this order.
14. It is further ordered, That, the applicants herein shall, pursuant to section 311(a) (2) of the Communications Act of 1934, as amended, and section 1.594 of the Commission's rules, give notice of the hearing within the time and in the manner prescribed in such rule, and shall advise the Commission of the publication of such notice as required by section 1.594(g) of the rules.
FEDERAL COMMUNICATIONS COMMISSION, BEN F. WAPLE, Secretary.
I concur, but would add an issue on undue concentration of control of media of mass communications by WPIX, Inc.