Skip Navigation

Federal Communications Commission

English Display Options

Commission Document

FCC Brief - Mary V. Harris Found. v. FCC (D.C. Cir.)

Download Options

Released: May 1, 2014
ORAL ARGUMENT NOT YET SCHEDULED
USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 1 of 67
BRIEF FOR APPELLEE
IN THE UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

NO. 13-1304

MARY V. HARRIS FOUNDATION,
APPELLANT,
V.
FEDERAL COMMUNICATIONS COMMISSION,
APPELLEE.

ON APPEAL FROM AN ORDER OF
THE FEDERAL COMMUNICATIONS COMMISSION


JONATHAN B. SALLET
ACTING GENERAL COUNSEL

DAVID M. GOSSETT
ACTING DEPUTY GENERAL COUNSEL

RICHARD K. WELCH
DEPUTY ASSOCIATE GENERAL COUNSEL

MATTHEW J. DUNNE
COUNSEL

FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON, D.C. 20554
(202) 418-1740


USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 2 of 67

CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES


Pursuant to D.C. Circuit Rule 28(a)(1), Appellee the Federal
Communications Commission (“FCC”) certifies as follows:

1. Parties.
All parties, intervenors, and amici appearing before the FCC and in this
Court are listed in the Brief for Appellant Mary V. Harris Foundation.

2. Rulings under review.
The ruling under review in this case is the FCC’s decision in Holy
Family Communications, Inc., Memorandum Opinion and Order, 28 FCC
Rcd 4854 (2013) (JA__), recon. denied, Holy Family Communications, Inc.,
Order on Reconsideration, 28 FCC Rcd 15687 (MB 2013) (JA__).

3. Related cases.
The FCC is not aware of any related cases.







USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 3 of 67

TABLE OF CONTENTS


Table of Authorities......................................................................................... iii 
Glossary .......................................................................................................... vii 
Jurisdiction ........................................................................................................ 1 
Questions Presented .......................................................................................... 2 
Statutes and Regulations ................................................................................... 3 
Counterstatement ............................................................................................... 4 
A.  Problems with the Previous Regime of Comparative
Hearings to Issue Noncommercial Educational FM Radio
Licenses ................................................................................................. 4 
B.  The Present Noncommercial Educational FM Radio
License Framework ............................................................................... 6 
1. 
Threshold Fair Distribution Preference Inquiry ................................ 7 
2. 
Second-Stage Points-Based Comparison ........................................ 10 
C.  Subsequent History of the 2000 NCE Rules ....................................... 12 
D.  Order Under Review ........................................................................... 13 
1. 
Initial Applications .......................................................................... 13 
2. 
Omnibus Order ................................................................................ 14 
3. 
The Harris Foundation’s Administrative Appeals .......................... 17 
Summary of Argument .................................................................................... 20 
Standard of Review ......................................................................................... 23 
Argument ......................................................................................................... 25 
I. 
The Fair Distribution Threshold Is Lawful. ............................................. 25 
A.  The FCC reasonably interpreted Section 307(b) in
instituting the fair distribution threshold. ............................................ 25 
i

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 4 of 67
B.  The FCC reasonably explained its decision to implement
the fair distribution threshold. ............................................................. 32 
II.  The Commission Did Not Abuse Its Discretion In Denying
A Waiver Of The 10 Percent Threshold. ................................................. 34 
III.  Appellant’s Notice-And-Comment Challenge Is Untimely
And, In Any Event, Without Merit. ......................................................... 37 
Conclusion ....................................................................................................... 41 
ii

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 5 of 67

TABLE OF AUTHORITIES

CASES

 
*
Alvin Lou Media, Inc. v. FCC, 571 F.3d 1 (D.C. Cir.
2009) ............................................................................................... 25, 28, 33
American Family Ass’n, Inc. v FCC, 365 F.3d 1156
(D.C. Cir. 2004) .................................................................................... 11, 13
AT&T Corp. v. FCC, 220 F.3d 607 (D.C. Cir. 2000) ..................................... 34
BDPCS, Inc. v. FCC, 351 F.3d 1177 (D.C.Cir.2003) .............................. 25, 34
Bechtel v. FCC, 10 F.3d 875 (D.C. Cir. 1993) .................................................. 5
BellSouth Corp. v. FCC, 162 F.3d 1215 (D.C. Cir.
1999) ............................................................................................................ 34
Blanca Tel. Co. v. FCC, 743 F.3d 860 (D.C. Cir.
2014) ..................................................................................................... 25, 34
Cellular Telecomm. & Internet Ass’n v FCC, 330
F.3d 502 (D.C. Cir. 2003) ........................................................................... 37
Chevron U.S.A., Inc. v. Natural Resources Defense
Council, Inc., 467 U.S. 837 (1984) ............................................................. 24
Consumer Elecs. Ass’n v. FCC, 347 F.3d 291 (D.C.
Cir. 2003) .............................................................................................. 24, 32
Covad Commc’ns Co. v. FCC, 450 F.3d 528 (D.C.
Cir. 2006) ..................................................................................................... 40
Crawford v. FCC, 417 F.3d 1289 (D.C. Cir. 2005) ........................................ 40
FCC v. Allentown Broadcasting Corp., 349 U.S.
358 (1955) ........................................................................................ 9, 25, 27
FCC v. Fox Television Stations, Inc., 556 U.S. 502
(2009) ................................................................................................... 24, 32
Functional Music, Inc. v. FCC, 274 F.2d 543 (D.C.
Cir. 1958) ..................................................................................................... 37
Indep. Cmty. Bankers of Am. v. Bd. of Governors of
Fed. Reserve Sys., 195 F.3d 28 (D.C. Cir. 1999) ........................................ 37
*
JEM Broad. Co., Inc. v. FCC, 22 F.3d 320 (D.C.
Cir. 1994) .................................................................................... 1, 23, 37, 38
iii

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 6 of 67
Nat’l Pub. Radio, Inc. v. FCC, 254 F.3d 226 (D.C.
Cir. 2001) ...................................................................................... 4, 5, 12, 13
Omnipoint Corp. v. FCC, 78 F.3d 620 (D.C. Cir.
1996) ..................................................................................................... 38, 40
Pasadena Broad. Co. v. FCC, 555 F.2d 1046 (D.C.
Cir. 1977) ..................................................................................................... 28
Raton Gas Transmission Co. v. FERC, 852 F.2d
612 (D.C.Cir.1988) ...................................................................................... 38

STATUTES

 
28 U.S.C. § 2344 ........................................................................................ 1, 37
47 U.S.C. § 303 ................................................................................................. 4
47 U.S.C. § 307 ................................................................................................. 4
*
47 U.S.C. § 307(b)................................................................................ 7, 25, 26
47 U.S.C. § 309 ................................................................................................. 4
47 U.S.C. § 309(j)(2)(c) .................................................................................... 6
47 U.S.C. § 397(6)............................................................................................. 6
47 U.S.C. § 402(b)(1) ........................................................................................ 1
5 U.S.C. § 553 ................................................................................................... 3
5 U.S.C. § 706(2)(A) .................................................................................. 3, 24
Balanced Budget Act of 1997, Pub. L. No. 105-33,
111 Stat. 251 .................................................................................................. 6

REGULATIONS

 
47 C.F.R. § 1.106(b)(3) ................................................................................... 20
47 C.F.R. § 1.106(p) ........................................................................................ 20
47 C.F.R. § 73.7000-73.7005 ............................................................................ 7
47 C.F.R. § 73.7002 .......................................................................................... 8
47 C.F.R. § 73.7002(b) ......................................................................... 2, 31, 33
47 C.F.R. § 73.7003 ........................................................................................ 11
47 C.F.R. § 73.7003(b)(4) ............................................................................... 31
47 C.F.R. § 73.7004 ........................................................................................ 15
iv

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 7 of 67
47 C.F.R. § 73.7005(b) .................................................................................... 31

ADMINISTRATIVE DECISIONS

 
Applications of Real Life Educ. Found. of Baton
Rouge, Inc., Jimmy Swaggart Ministries, 6 FCC
Rcd 2577 (Rev. Bd. 1991) ............................................................................. 8
Competitive Bidding for Commercial Broadcast and
ITFS Licensees, Report and Order, 13 FCC Rcd
15920 (1998) .............................................................................................6, 9
New York University, 10 Rad. Reg. 2d (P&F) 215
(1967) ..................................................................................................... 7, 32
Policies to Promote Rural Radio Service and to
Streamline Allotment and Assignment
Procedures
, First Report and Order, 25 FCC Rcd
1583 (2010) ................................................................................................. 33
Reexamination of Competitive Standards for
Noncommercial Educ. Applicants, Memorandum
Opinion and Second Order on Reconsideration,
17 FCC Rcd 13132 (2002) .......................................................................... 41
*
Reexamination of the Comparative Standards for
Noncommercial Educational Applicants, Further
Notice of Proposed Rulemaking, 13 FCC Rcd
21167 (1998) .................................................................................. 4, 6, 9, 39
*
Reexamination of the Comparative Standards for
Noncommercial Educational Applicants,
Memorandum Opinion and Order, 16 FCC Rcd
5074 (2001) ........................................................................ 12, 14, 29, 30, 40
Reexamination of the Comparative Standards for
Noncommercial Educational Applicants, Notice
of Proposed Rulemaking, 10 FCC Rcd 2877
(1995) ............................................................................................................ 5
*
Reexamination of the Comparative Standards for
Noncommercial Educational Applicants, Report
and Order, 15 FCC Rcd 7386 (2000) .... 6, 7, 8, 9, 10, 11, 14, 26, 27, 29, 32,
33, 35, 36
v

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 8 of 67
Reexamination of the Policy Statement on
Comparative Broad. Hearings, Notice of
Proposed Rulemaking, 7 FCC Rcd 2664 (1992) ........................................... 5


* Cases and other authorities principally relied upon are marked with
asterisks.

vi

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 9 of 67

GLOSSARY

Act The
Communications
Act of 1934, as amended
Bureau
FCC Media Bureau
Central Florida
Central Florida Educational Foundation, Inc.
Competitive Bidding Order Competitive Bidding for Commercial Broadcast
and ITFS Licensees, Report and Order, 13 FCC
Rcd 15920 (1998)
FCC Federal
Communications
Commission
The Harris Foundation
Mary V. Harris Foundation
Holy Family
Holy Family Communications, Inc.
NCE (used only in
citations and quotations)
Noncommercial Educational (broadcast)
NCE Order
Reexamination of the Comparative Standards for
Noncommercial Educational Applicants
, Report
and Order, 15 FCC Rcd 7386 (2000)
NCE NPRM
Reexamination of the Comparative Standards for
Noncommercial Educational Applicants
, Further
Notice of Proposed Rulemaking, 13 FCC Rcd
21167 (1998).
NCE Recon Order
Reexamination of the Comparative Standards for
Noncommercial Educational Applicants
,
Memorandum Opinion and Order, 16 FCC Rcd
5074 (2001)
Omnibus Order
Comparative Consideration of 76 Groups of
Mutually Exclusive Applications for Permits to
Construct New or Modified Noncommercial
Educational FM Stations
, Memorandum
Opinion and Order, 22 FCC Rcd 6101 (2007)

vii

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 10 of 67
IN THE UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT

NO. 13-1304

MARY V. HARRIS FOUNDATION,
APPELLANT,
V.
FEDERAL COMMUNICATIONS COMMISSION,
APPELLEE.

ON APPEAL FROM AN ORDER OF
THE FEDERAL COMMUNICATIONS COMMISSION

BRIEF FOR APPELLEE

JURISDICTION

This Court has jurisdiction over many of Appellant’s claims under 47
U.S.C. § 402(b)(1). However, as detailed below, Appellant’s challenge that
the agency failed to provide adequate notice and opportunity for comment on
the underlying substantive rule, issued in 2000, is untimely. 28 U.S.C.
§ 2344. This Court therefore lacks jurisdiction to hear that challenge. JEM
Broad. Co., Inc. v. FCC, 22 F.3d 320, 325 (D.C. Cir. 1994).



USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 11 of 67

QUESTIONS PRESENTED

Under rules the FCC instituted in 2000, when multiple applicants seek
mutually exclusive noncommercial educational FM radio licenses, in
specified circumstances the agency awards the license to an applicant that
would provide service to a community that currently has no or limited
noncommercial educational FM radio. In particular, at a threshold phase of
the process, the agency awards a dispositive preference to an applicant that
would provide the first or second noncommercial educational FM radio
service to at least 10 percent of the population covered by the proposed
station, provided that this 10 percent represents at least 2,000 people. 47
C.F.R. § 73.7002(b). If no party receives this “fair distribution” preference,
the agency selects the applicant that receives the most points based on a
number of other objective criteria.
Appellant Mary V. Harris Foundation (the Harris Foundation) and
Intervenor Holy Family Communications, Inc. (Holy Family) filed mutually
exclusive license applications. Because the Harris Foundation proposed to
provide first or second noncommercial educational FM radio service to only
9.46 percent of its proposed service population, it did not qualify for the
dispositive preference. The agency then awarded the license to Intervenor
2

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 12 of 67
Holy Family instead based on the remaining decisional criteria. The Harris
Foundation’s appeal presents the following questions for review:
1. Whether the 10 percent fair distribution preference represents an
unreasonable interpretation of Section 307(b) of the Communications Act, or
is otherwise arbitrary, capricious, or contrary to law under the Administrative
Procedure Act (APA), 5 U.S.C. § 706(2)(A).
2. Whether the FCC abused its discretion by not waiving its rule and
awarding a dispositive fair distribution preference to the Harris Foundation.
3. Whether the Harris Foundation is time-barred from raising a
procedural challenge to the underlying rule issued in 2000, and, if not,
whether the agency failed to provide adequate notice and opportunity to
comment on the procedure implementing the fair distribution preference, as
required by the APA, 5 U.S.C. § 553.

STATUTES AND REGULATIONS

The relevant statutes and regulations are appended to this brief.


3

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 13 of 67

COUNTERSTATEMENT

This case concerns the award of a noncommercial educational FM
radio license in upstate New York to Intervenor Holy Family
Communications, Inc., over the mutually exclusive application by Appellant
the Mary V. Harris Foundation.

A. Problems with the Previous Regime of Comparative

Hearings to Issue Noncommercial Educational FM
Radio Licenses

The Communications Act of 1934, as amended (Act), directs the FCC
to advance the “public interest, convenience, [and] necessity” by granting
broadcast licenses. See 47 U.S.C. §§ 303, 307, & 309. As part of this duty,
the FCC has long reserved portions of the FM radio spectrum for
noncommercial educational use because of the “‘high quality type of
programming…available in such stations—programming of an entirely
different character from that available on most commercial stations.’” See
Nat’l Pub. Radio, Inc. v. FCC, 254 F.3d 226, 227 (D.C. Cir. 2001) (quotation
marks and citations omitted). Noncommercial educational licensees include
schools, churches, and not-for-profit corporations and foundations. See
Reexamination of the Comparative Standards for Noncommercial
Educational Applicants, Further Notice of Proposed Rulemaking, 13 FCC
Rcd 21167, 21168, ¶ 2 (1998) (NCE NPRM).
4

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 14 of 67
Until the 1990s, the Act required that when two applicants sought
mutually exclusive licenses—i.e., licenses that could not operate
simultaneously because of interference—the Commission must hold an
evidentiary hearing before an administrative law judge to choose which
applicant would receive the license. See Nat’l Pub. Radio, 254 F.3d at 227.
By the 1990s, the FCC and courts began to see this system of
evidentiary comparative hearings as both inefficient and impermissibly
subjective. See Bechtel v. FCC, 10 F.3d 875, 885 (D.C. Cir. 1993) (criteria
used in hearings were “packed with subjective judgments, some generic,
some ad hoc”); Reexamination of the Policy Statement on Comparative
Broad. Hearings, Notice of Proposed Rulemaking, 7 FCC Rcd 2664, 2664,
¶ 2 (1992) (inquiring whether hearing “criteria have become too subjective
and imprecise to be used effectively in the public interest”). Accordingly, in
1995, the Commission froze all proceedings on pending applications for
broadcast licenses and initiated an inquiry into possible improvements to the
selection processes. See Reexamination of the Comparative Standards for
Noncommercial Educational Applicants, Notice of Proposed Rulemaking, 10
FCC Rcd 2877, 2879, ¶ 14 (1995).
In 1997, while the agency rulemaking was ongoing, Congress
authorized the FCC to allot commercial broadcast licenses by auction rather
5

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 15 of 67
than by the existing criteria-based selection process. See Balanced Budget
Act of 1997, Pub. L. No. 105-33, § 3002, 111 Stat. 251 (codified at 47 U.S.C.
§ 309(j)). After notice and comment, the Commission implemented an
auction system for commercial stations. See Competitive Bidding for
Commercial Broadcast and ITFS Licensees, Report and Order, 13 FCC Rcd
15920 (1998) (Competitive Bidding Order).
Congress explicitly prohibited the FCC from auctioning spectrum for
noncommercial educational stations, however. See 47 U.S.C. §§ 309(j)(2)(c)
& 397(6). In 1998, the Commission therefore called for comment on possible
improvements to the process for awarding noncommercial educational
licenses, including the options of using a lottery or using a points system. See
NCE NPRM, 13 FCC Rcd at 21170, ¶ 7.

B. The Present Noncommercial Educational FM Radio

License Framework

In 2000, after extensive comments representing the views of over 100
organizations, the Commission adopted a points system for the award of
noncommercial educational licenses. Reexamination of the Comparative
Standards for Noncommercial Educational Applicants, Report and Order, 15
FCC Rcd 7386, 7391, ¶¶ 5-7 (2000) (NCE Order).
Under this system, the Commission first considers the “fair distribution
of stations to communities as a threshold issue,” and, where that factor is not
6

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 16 of 67
dispositive, selects the application that receives the most points based on a
number of other objective criteria. Id. at 7395, ¶ 19; see 47 C.F.R. §§
73.7000-73.7005. The Commission found that this system would “eliminate
the vagueness and unpredictability of the [previous] system, clearly express
the public interest factors that the Commission finds important in
[noncommercial educational] broadcasters, and select the applicant who best
exemplifies these criteria.” NCE Order, 15 FCC Rcd at 7394, ¶ 18. The
Commission also concluded that this objective system “would reduce the
costs and time associated with comparative proceedings both for applicants
and the Commission.” Id.
1. Threshold Fair Distribution Preference Inquiry
Under Section 307(b) of the Act, the Commission must distribute radio
licenses “among the several States and communities as to provide a fair,
efficient, and equitable distribution of radio service to each of the same.” 47
U.S.C. § 307(b). Under the previous system of comparative hearings for
noncommercial educational FM radio licenses, an ALJ could give weight, as
one criterion among several, to the fact that an applicant proposed to provide
service to an area that had no noncommercial educational service, or had only
one other noncommercial educational station. See New York University, 10
Rad. Reg. 2d (P&F) 215, 217, ¶ 8 (1967) (FCC Add. 2). Although the ALJ
7

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 17 of 67
was “permitted to give whatever weight he deem[ed] appropriate” to these
Section 307(b) factors, id., in practice, this consideration could be dispositive
when it was significant. See, e.g., Applications of Real Life Educ. Found. of
Baton Rouge, Inc., Jimmy Swaggart Ministries, 6 FCC Rcd 2577, 2579, ¶ 11
(Rev. Bd. 1991).
Under the revised system, the Commission now evaluates the fair
distribution of service as a threshold criterion. See NCE Order, 15 FCC Rcd
at 7398, ¶ 24; 47 C.F.R. § 73.7002. Specifically, when competing applicants
propose to serve different communities with mutually exclusive
noncommercial educational FM radio licenses, the Commission awards a
dispositive preference to an applicant that provides the first or second
noncommercial educational signal to at least 10 percent of the people within
the service contours of its station, provided that this percentage represents at
least 2,000 people. 47 C.F.R. § 73.7002. If more than one applicant passes
this threshold, the applicant providing first or second noncommercial
educational service to the most people is selected, provided that the difference
in service between the applicants is at least 5,000 people. Id. If multiple
applicants are equivalent under this test, those applicants move on to the next
stage of selection, based on points. Likewise, if no applicant passes this
threshold, all move on to that next stage.
8

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 18 of 67
In the NPRM, the FCC had proposed considering fair distribution as
part of the points system, awarding points for first or second noncommercial
educational service, as opposed to a potentially dispositive threshold. NCE
NPRM, 13 FCC Rcd at 21177, ¶ 21. “Upon consideration of the comments,”
however, the Commission decided to evaluate fair distribution of service at
the threshold. NCE Order, 15 FCC Rcd at 7396, ¶ 24. The agency noted that
this framework was more consistent with its previous approach—where
significant differences under the Section 307(b) criterion could be
dispositive—as well as its approach in other contexts, such as its then-
recently-adopted rules for commercial AM radio, where the agency also
evaluates fair distribution as a threshold criterion before proceeding to
competitive bidding if appropriate. See id.; see also Competitive Bidding
Order, 13 FCC Rcd at 15964, ¶ 120 (assessing fair distribution at the
threshold avoids “subordinat[ing] the ‘needs of the community’ to the ‘ability
of an applicant for another locality’” (quoting FCC v. Allentown
Broadcasting Corp., 349 U.S. 358 (1955))).
However, the FCC agreed with commenters that differences between
proposals in first or second noncommercial educational service “should be
decisional only if they are significant.” NCE Order, 15 FCC Rcd at 7397,
¶ 25. One commenter had proposed a threshold based on first or second
9

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 19 of 67
noncommercial educational service to 5 percent of the population served or a
2,000 person minimum. Id. The agency “generally concur[red] with this
suggestion, and with the 2,000 person minimum, but believe[d] that the
percentage difference in population coverage must be greater if it is to
distinguish between applications in well populated areas, as a threshold
matter.” Id. To address this concern, the agency set the threshold at 10
percent of the population served. Id. The agency also required that an
applicant satisfy the 10 percent threshold and that this percentage represent at
least 2,000 people. It recognized that, because of this relatively high
threshold, “there may not be a large number of cases in which Section 307(b)
issues will be dispositive.” Id. at 7397, ¶ 24.
To ensure that communities actually receive the benefits in question,
the FCC requires that any station that receives a license based on the Section
307(b) threshold build and operate its service as proposed, and not reduce
service to its proposed community for at least four years. Id. at 7398, ¶ 27.
2. Second-Stage Points-Based Comparison
If an applicant is not chosen by application of the fair distribution
threshold, all remaining applicants are evaluated on points awarded on the
basis of four other factors, as follows:
10

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 20 of 67
Diversity of Ownership (2 points) – awarded where the proposed
service area does not overlap with another service area controlled
by the same entity.
Technical Parameters (1-2 points) – one point awarded if an
applicant serves at least a 10 percent greater area and 10 percent
greater population than other applicants; two points awarded with a
25 percent greater area and population.
Localism (3 points) – awarded where an applicant is physically
headquartered, has a campus, or has 75 percent of its board
members residing within 25 miles of the center of the proposed
service area.
State-Wide Network Credit (2 points) – awarded to an entity with
authority over at least 50 elementary or secondary schools within a
state or at least 5 higher-learning campuses within a state.
See NCE Order, 15 FCC Rcd at 7393-7413, ¶¶ 15-61; 47 C.F.R. § 73.7003;
American Family Ass’n, Inc. v FCC, 365 F.3d 1156 (D.C. Cir. 2004)
(discussing points system). The candidate with the most points is awarded
the license, with further provisions for tie-breaking. NCE Order, 15 FCC
Rcd at 7416-18, ¶¶ 69-74.
11

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 21 of 67

C. Subsequent History of the 2000 NCE Rules

In 2001, the Commission responded to a number of petitions for
clarification and administrative reconsideration. See Reexamination of the
Comparative Standards for Noncommercial Educational Applicants,
Memorandum Opinion and Order, 16 FCC Rcd 5074 (2001) (NCE Recon
Order). On reconsideration, the agency confirmed its decision to evaluate
fair distribution of service as a threshold matter, rather than as part of the
points system. Id. at 5088, ¶ 38. As the Commission explained, although
under the previous system of comparative hearings, the ALJ had discretion to
give “whatever weight he deemed appropriate” to Section 307(b) fair
distribution considerations, in practice, “307(b) issues [could] be dispositive
[under the previous system], as long as the differences [were] not slight.” Id.
The agency explained that its new threshold rules likewise “ensured that only
significant 307(b) differences are decisional.” Id. When applicants “have
only small differences,” as assessed under the threshold, their applications are
evaluated under the points system. Id.
The NCE Order was twice challenged in court. No one challenged the
fair distribution threshold. In National Public Radio, Inc. v. FCC, 254 F.3d
226 (D.C. Cir. 2001), this Court held that the Commission could not require
noncommercial educational applicants to participate in auctions when they
12

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 22 of 67
vied for licenses in unreserved spectrum alongside commercial operators. Id.
at 227. In American Family Association, Inc. v. FCC, 365 F.3d 1156 (D.C.
Cir. 2004), this Court upheld the rules against challenges that certain aspects
of the points system were irrational, or inconsistent with the Act, or
unconstitutional under the free speech or free exercise clauses of the First

Amendment. Id. at 1163, 1168.

D. Order Under Review

1. Initial Applications
Intervenor Holy Family Communications, Inc. and Appellant Mary V.
Harris Foundation filed mutually exclusive applications for noncommercial
educational FM radio stations in upstate New York in September 1996 and
May 1997, respectively. See Holy Family Application (JA___); Harris
Foundation Application (JA__). Because the Commission had instituted a
freeze on processing applications while it considered reform of its license
assignment procedures, see p. 5 above, no further action was taken on those
applications until after the NCE Order set out the new framework. The NCE
Order then directed applicants like the Harris Foundation and Holy Family to
file “points supplements” providing the additional information necessary to
13

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 23 of 67
evaluate the pending applications under the new points system. NCE Order,
1
15 FCC Rcd at 7424, ¶ 91.
Both Holy Family and the Harris Foundation timely filed points
supplements. See Holy Family Points Supplement (JA__); Harris
Foundation Points Supplement (JA__). In those supplements, both applicants
disavowed entitlement to a Section 307(b) fair distribution preference
because neither would provide the first or second noncommercial educational
FM radio service to at least 10 percent of their service population. Id. The
Harris Foundation also did not request a waiver of the fair distribution
threshold.
2. Omnibus Order
In March 2007, the Commission issued decisions on seventy-six
pending noncommercial educational FM radio licenses, including the
applications at issue here. See Comparative Consideration of 76 Groups of

1 The Commission explained that it would evaluate the technical aspects of
proposals—such as the coverage area and strength—as of the date the
applications were originally submitted. This was necessary because the staff
had already designated the groups of mutually exclusive applications based
on the coverage claimed in the previously-filed applications, and any
amendments would require review of all these groups, leading to further
delay. NCE Recon Order, 16 FCC Rcd at 5085, ¶ 31. For purposes of
evaluating applications under the Section 307(b) threshold, however, the
Commission explained that it would use current census data as of the date on
which the points supplements were filed because that would be more accurate
and easier. Id. at ¶ 32.
14

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 24 of 67
Mutually Exclusive Applications for Permits to Construct New or Modified
Noncommercial Educational FM Stations, Memorandum Opinion and Order,
22 FCC Rcd 6101 (2007) (Omnibus Order) (JA__). Because the Harris
Foundation and Holy Family “each certified that it would not qualify for a
Section 307(b) preference,” “[t]he applications…proceed[ed] to a point
hearing.” Id. at ¶ 97 (JA__). Holy Family was awarded three points as an
established local applicant and two points for diversity of ownership, for a
total of five points. Id. at ¶ 98 (JA__). The Harris Foundation was awarded
two points for diversity of ownership for a total of two points. Id. Neither
was awarded points for the best technical proposal because they proposed to
serve approximately equal areas (though the Harris Foundation would serve a
2
greater population). Id. Because Holy Family was awarded more points, it
was tentatively selected as the licensee, subject to petitions for denial. Id. at
¶¶ 2, 98 (JA__, __); 47 C.F.R. § 73.7004.
Although the Harris Foundation did not petition for waiver of the 10
percent threshold for a fair distribution preference in its points supplement,
another party in a different mutually exclusive group had argued that its own

2 Holy Family’s proposed service area encompassed 228 square kilometers
with a population of 93,427. The Harris Foundation’s proposed service area
encompassed 204 square kilometers with a population of 300,673. Points are
awarded only if one applicant’s proposal exceeds the other’s by 10 percent of
both area and population. Id.
15

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 25 of 67
“‘anomalous’ situation…warrant[ed] award of a fair distribution preference.”
Id. at ¶ 28 (JA__). Central Florida Educational Foundation, Inc. (Central
Florida) stated it would provide first or second noncommercial educational
service to almost 25,000 people—9.33 percent of its service population—
which, Central Florida pointed out, was close to the 10 percent benchmark
and “far exceeded” the 2,000 person minimum. The Commission rejected the
request and explained that this argument for a waiver “reflects a
misunderstanding of the [noncommercial educational] Section 307(b)
eligibility standard,” in which both the 10 percent threshold and the 2,000
person minimum were important and served different purposes. Id. at ¶ 30
(JA__). As the agency explained:
These two components work in tandem to make the standard
meaningful regardless of community size. In well-populated
service areas such as Central’s, the ten percent component
ensures that Section 307(b) eligibility is limited to NCE
applicants offering new service to a significant portion of the
relatively large population. In contrast, the 2,000 person
component is designed for small communities to ensure that
trivial service differences are not treated as dispositive. It would
be neither “odd” nor “anomalous” for an applicant in a populated
area to propose first and second service to a population well in
excess of 2,000 yet fail to qualify for a Section 307(b) preference
because it falls short of the ten percent benchmark.
Id. The agency therefore denied Central Florida’s request for a waiver of the
fair distribution preference threshold, and the applications in that group
advanced to a decision based on points. Id.
16

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 26 of 67
3. The Harris Foundation’s Administrative Appeals
The Harris Foundation filed a petition to deny Holy Family’s license.
See Harris Foundation 2007 Petition to Deny (JA__). Among other
contentions, the Harris Foundation argued that the FCC should award it a
dispositive fair distribution preference based on its second noncommercial
educational service to 9.46 percent of its population. It admitted that this
“does not quite reach the 10% threshold,” but argued that “it comes very
close” and “would serve the public interest by bringing a second service to a
substantially larger number of people.” Id. at 5 (JA__).
The Media Bureau (Bureau) rejected this argument as “not
compelling.” Mary V. Harris Foundation, 22 FCC Rcd 18931, 18934 (MB
2007) (“Bureau Letter Decision”) (JA__). The Bureau first pointed out that
the Commission had denied Central Florida’s request for a waiver in similar
circumstances in the Omnibus Order. In response to the Harris Foundation’s
argument that the ten percent threshold was arbitrary, the Bureau pointed out
that the agency “must necessarily draw numerical lines in establishing
threshold qualifications, and has the discretion to do so.” Id. at 4-5 (JA__).
In setting the threshold at 10 percent, the agency “took into account that
applicants receiving a fair distribution preference can prevail on that basis
17

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 27 of 67
alone” and therefore “established standards to ensure that only the most
significant differences would be decisional.” Id. at 5 (JA__).
The Harris Foundation also argued that the 10 percent threshold was
inefficient because, had it been permitted to amend its application, it might
have done so in order to reduce its total service area but increase the
percentage of its coverage as first or second noncommercial educational
service. Harris Foundation 2007 Petition to Deny at 6 (JA__). The Bureau
found this “immaterial” because, under the NCE Order, applicants with then-
pending applications could not make alterations to their coverage area, and
more generally, “[t]he Commission’s procedures encourage applicants to
apply for the facilities that they wish to construct.” Bureau Letter Decision at
5 (JA__).
The Bureau did agree with the Harris Foundation that, based on new
engineering data, Holy Family in fact did not qualify for the two points it had
been awarded for diversity of ownership. Id. Holy Family argued that the
overlap between the coverage area of its proposed operations and existing
operations of less than one square kilometer was de minimis and merited a
waiver. Id. In opposition, the Harris Foundation argued that a waiver would
be inappropriate because the overlap was a result of Holy Family’s own
engineering choices and Holy Family had not shown waiver would be in the
18

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 28 of 67
public interest. Id. The Bureau agreed that a waiver was inappropriate and
therefore deducted two points from Holy Family’s tally. Id. Because Holy
Family still had three points to the Harris Foundation’s two, however, this did
not change the outcome. Id. at 6 (JA__).
The Harris Foundation then petitioned the Bureau for reconsideration.
See Harris Foundation 2007 Petition for Reconsideration (JA__). The
Bureau found that the Harris Foundation did not present new arguments or
facts to support its plea for a waiver of the 10 percent threshold, and therefore
declined to reconsider its previous decision. See 2011 Reconsideration
Decision ¶ 4 (JA __).
The Harris Foundation then petitioned the full Commission for review.
See Harris Foundation 2011 Application for Review (JA__). It again argued
that the 10 percent threshold “serves little practical purpose,” and that the
Commission should award a dispositive fair distribution preference to the
Harris Foundation because it would provide the second noncommercial
educational service to a greater number of people than Holy Family, “which
should be the Commission’s objective.” Id. at 5-7 (JA__). The Commission
found the Bureau had “properly decided the matters raised” by the Harris
Foundation and upheld the previous decisions based on the reasoning set out
there. Commission Order ¶ 2 (JA__).
19

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 29 of 67
The Harris Foundation petitioned the Commission for reconsideration.
See Harris Foundation 2013 Petition for Reconsideration (JA__). It pressed
3
essentially the same argument, and the Bureau, on behalf of the Commission,
dismissed the Petition as repetitious. 2013 Reconsideration Order ¶ 7
(JA__). This appeal followed.

SUMMARY OF ARGUMENT

In the NCE Order, promulgated over thirteen years ago, the FCC
established a simple, bright-line rule to award a potentially dispositive
preference to a noncommercial educational FM radio license application
where the applicant provides the first or second noncommercial educational
signal to at least 10 percent of the people within the proposed station’s
service contour. In the Order under review, the agency determined that the
Harris Foundation, which proposed to provide such service to only 9.46
percent of the people within its service area, did not qualify for the
preference. The Commission’s determination was a straightforward
application of its bright-line rule, and should be upheld.

3 FCC rules provide that a Bureau may dismiss a petition for
reconsideration of a Commission decision affirming a prior Bureau decision
if the petition fails to rely on new facts or changed circumstances. 47 C.F.R.
§§ 1.106(b)(3) & 1.106(p)
20

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 30 of 67

I.


The FCC’s objective test for whether and when to award a dispositive
preference is a reasonable interpretation of the competing goals set out in
Section 307(b), which requires an “equitable,” “efficient,” and “fair
distribution” of radio licenses. As the Harris Foundation itself noted in the
proceeding below, the Commission “explained that the formula is designed to
balance the opportunities for new stations in both large and small
communities.” Harris Foundation 2007 Petition to Deny at 6 (JA__). The
10 percent component of the threshold ensures that “[i]n well populated
service areas” “Section 307(b) eligibility is limited to [noncommercial
educational] applicants offering new service to a significant portion of the
relatively large population.” Omnibus Order ¶ 30 (JA__). A test that simply
counted noses without a percentage would unduly favor applicants in more
populous areas at the expense of applicants in less populous ones.
The Harris Foundation claims that the Commission’s 10 percent
threshold is contrary to Section 307(b)’s requirement that the agency
distribute licenses “efficient[ly]”—a standard that the Harris Foundation
appears to equate with maximizing the number of listeners above all else.
But Section 307(b) also requires an “equitable” and “fair distribution” among
communities, and the agency has discretion to balance these objectives. A
system that concentrates solely on “service for the maximum number of
21

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 31 of 67
people,” as the Harris Foundation urges (Br. 23), would run counter to the
statute. And, contrary to the Harris Foundation’s argument (Br. 28-31), the
rules do not encourage applicants to submit proposals that shrink coverage in
order to raise the percentage of new service. Because the rules prefer
applicants who serve more people if more than one applicant passes the
threshold or if no one passes the threshold, any applicant who purposely
sought to shrink its coverage area would risk losing out to a competing
applicant that proposed to serve more people.
The agency was also reasonable in adopting these rules as a departure
from the previous regime. The agency explained that a system of a bright-
line threshold and points would be both more objective and more efficient
than the prior flawed system of comparative hearings.

II.


The agency did not abuse its discretion in refusing to waive the ten
percent threshold for the Harris Foundation. Every bright-line rule may
present cases in which an applicant is close to, but short of, the threshold.
The Harris Foundation presented no reason to look past this clear line. As the
agency explained, it was hardly “anomalous” that the Harris Foundation—
which proposed to serve a more populous area than Holy Family—did not
qualify for the fair distribution preference even though it would provide new
noncommercial educational service to more people. The very point of the 10
22

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 32 of 67
percent threshold is to avoid unduly preferring applications serving large
communities. Indeed, the agency had already denied a petition to waive
under circumstances that the Harris Foundation did not meaningfully
distinguish.

III.


Finally, under well-settled precedent, the Harris Foundation is barred
from now arguing that the 2000 NCE Order provided inadequate notice and
opportunity to comment on the ten percent threshold. Such a procedural
challenge must be raised at the time a rule is originally promulgated; it cannot
be revived now that the rule has been in effect for more than a decade. JEM
Broad. Co., Inc. v. FCC, 22 F.3d 320, 325 (D.C. Cir. 1994). In any case, the
ten percent threshold is a logical outgrowth of the Notice of Proposed
Rulemaking, where the agency proposed an objective test for the fair
distribution of service and made clear more generally that it aimed to
construct rules that did not unduly favor applicants serving more populous
areas. It was hardly a major shift, then, when the Commission adopted a
modified version of a party’s proposal in the rulemaking record to use a
percentage threshold to accomplish precisely those goals.

STANDARD OF REVIEW

In the Order on review, the Commission upheld the Bureau’s
application of the fair distribution threshold, a rule issued in the 2000 NCE
23

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 33 of 67
Order. The Harris Foundation attacks both the underlying rule and its
application here. Its argument that the fair distribution threshold is contrary
to Section 307(b) is reviewed under the familiar framework of Chevron
U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984).
Under that standard, where Congress has not “unambiguously expressed [its]
intent,” the Court asks “whether the agency’s answer is based on a
permissible construction of the statute.” Id. at 843.
The Harris Foundation also argues that the agency was arbitrary and
capricious in adopting the fair distribution threshold. The Court’s review
under the arbitrary and capricious standard of the APA, 5 U.S.C. § 706(2)(A),
is “necessarily deferential.” Consumer Elecs. Ass’n v. FCC, 347 F.3d 291,
300 (D.C. Cir. 2003). The Court will “presume the validity of the
Commission’s action and will not intervene unless the Commission failed to
consider relevant factors or made a manifest error in judgment.” Id.
Moreover, an agency is not subject to “more searching review” or a
“heightened duty” when it changes course from a previous policy—it need
only provide an adequate explanation for the new one. FCC v. Fox
Television Stations, Inc., 556 U.S. 502, 515 (2009).
Finally, this Court “will vacate the [Commission’s] denial of a waiver
‘only when the agency’s reasons are so insubstantial as to render that denial
24

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 34 of 67
an abuse of discretion.’” Blanca Tel. Co. v. FCC, 743 F.3d 860, 864 (D.C.
Cir. 2014) (quoting BDPCS, Inc. v. FCC, 351 F.3d 1177, 1181
(D.C.Cir.2003)).

ARGUMENT

I.

THE FAIR DISTRIBUTION THRESHOLD IS LAWFUL.

A. The FCC reasonably interpreted Section 307(b) in

instituting the fair distribution threshold.
The Harris Foundation argues that the 10 percent portion of the fair
distribution threshold is an unlawful implementation of Section 307(b). Br.
23-31. That Section tasks the Commission with “mak[ing] such distribution
of [broadcast] licenses...among the several States and communities as to
provide a fair, efficient, and equitable distribution of radio service to each of
the same.” 47 U.S.C. § 307(b). Because “[t]he text of § 307 is silent
regarding…what the Commission should consider in making § 307(b)
determinations,” “the Supreme Court has underscored the scope of the
Commission’s discretion” in carrying out these duties. Alvin Lou Media, Inc.
v. FCC, 571 F.3d 1, 11 (D.C. Cir. 2009) (citing FCC v. Allentown Broad.
Corp., 349 U.S. 358, 362 (1955)). The Harris Foundation must therefore
establish at Chevron’s step two that the fair distribution threshold is
“impermissible” under the language of Section 307(b). Alvin Lou Media, 571
F.3d at 11. It cannot do so.
25

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 35 of 67
1.
The rules set out in the NCE Order—including the fair
distribution threshold—represent a reasonable balancing of the competing
goals of “equit[y],” “fair[ness]” and “efficien[cy]” set out by Section 307(b).
See 47 U.S.C. § 307(b). The agency explained that it chose an objective
system of the 10 percent threshold and a points framework in order to
“eliminate the vagueness and unpredictability of the [previous] system,”
while at the same time “clearly express[ing] the public interest factors that the
Commission finds important in [noncommercial educational] broadcasters.”
NCE Order, 15 FCC Rcd at 7394, ¶ 18. A system of clear objective rules
likewise promised to “reduce the costs and time…both for applicants and the
Commission” in evaluating mutually exclusive applications for
noncommercial educational licenses. Id.
The FCC chose a potentially dispositive 10 percent and 2,000 person
threshold for first or second noncommercial educational service, as opposed
to simply awarding points as part of the points proceeding, because that
approach “would be most consistent with [its then-]existing Section 307(b)
approach, which [had] been upheld in court.” Id. at 7398, ¶ 24. For example,
in Allentown Broadcasting, which the agency cited, id., the Supreme Court
upheld the allocation of a license as a threshold matter to a community
26

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 36 of 67
without service, even though a competing applicant had a superior application
if judged on other, technical grounds. See 349 U.S. at 361-62.
At the same time, the FCC in the NCE Order “agree[d] with
commenters that [fair distribution] differences between proposals should be
decisional only if they are significant.” NCE Order, 15 FCC Rcd at 7396,
¶ 25. To secure this goal, the agency set out a two-part fair distribution
threshold—applicants must provide first or second noncommercial
educational service to at least 2,000 people and the people receiving such
service must constitute at least 10 percent of the total population served. Id.
The 10 percent component is necessary in order to “distinguish between
applicants in well populated areas.” Id. As the agency elaborated in denying
a waiver of the 10 percent requirement in the Omnibus Order, “[i]n well
populated service areas…, the ten percent component ensures that Section
307(b) eligibility is limited to [noncommercial educational] applicants
offering new service to a significant portion of the relatively large
population.” Omnibus Order ¶ 30 (JA__). Otherwise, an applicant in a more
populous area would be much more likely to receive a fair distribution
preference than a competing applicant from a comparatively rural one. Such
a bias in favor of more populous areas would undermine the purpose of the
statute to assure fair distribution to all communities. See Pasadena Broad.
27

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 37 of 67
Co. v. FCC, 555 F.2d 1046, 1050 (D.C. Cir. 1977) (Section 307(b) was
enacted to combat the “[c]oncentration of radio service in the big city”).
2.
The Harris Foundation argues that the FCC’s 10 percent
threshold conflicts with Section 307(b), for two reasons (Br. 23-31), but both
fail to establish that the agency’s reading of Section 307(b) is
“impermissible.” See Alvin Lou Media, 571 F.3d at 11.
First, the Harris Foundation argues that the 10 percent threshold does
not promote an “efficient” allocation of spectrum, as required by Section
307(b), because it is not focused solely on “the raw objective number of
people being served.” Br. 26. But such a myopic focus would run afoul of
the remainder of Section 307(b), which requires a “fair” and “equitable”
distribution of licenses. As this Court explained, Congress did not intend that
a “license is [always] to be awarded to the applicant who would encompass
the most listeners within the range of his signal. If that were so, all
frequencies likely would be assigned sooner or later to powerful stations in
major population centers—precisely the result Congress meant to forestall by
means of Section 307(b).” Pasadena Broad. Co., 555 F.2d at 1049-50. So
too here. A policy which automatically awarded a dispositive preference to
an applicant serving the greater number of listeners, without taking into
28

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 38 of 67
account the percentage of listeners, would be unfairly biased in favor of
applicants with “well populated service areas.” Omnibus Order, ¶ 30 (JA__).
This is not to say the Commission failed to account for efficiency. If
more than one applicant would provide first or second noncommercial
educational service to more than 10 percent of its population, then a candidate
that provides such service to at least 5,000 more people will receive the
preference. NCE Order, 15 FCC Rcd at 7397, ¶ 25. Moreover, efficiency
encompasses not just which station provides the first or second
noncommercial educational service, but also which station provides
noncommercial educational service to the most people or largest area
generally, regardless of the noncommercial educational service already
available. As the Commission explained, this factor is accounted for by the
“technical factor” of the points system, which awards up to two points if an
applicant serves a significantly greater area and population. NCE
Reconsideration Order, 16 FCC Rcd at 5088, ¶ 38; see p. 11 above.
Although a dispositive award for satisfying the fair distribution threshold cuts
off this efficiency consideration, where applicants present no “significant
307(b) differences” the rules take account of efficiency through the technical
factor of the points system. Id.
29

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 39 of 67
Second, the Harris Foundation argues that the rules are inconsistent
with Section 307(b) because they fail to secure an “equitable” and “fair
distribution” of service. Br. 28-31. It alleges that, had it been allowed to
alter its proposal in response to the NCE Order, it could have done so in a
way that would have increased the percentage of listeners receiving first or
second noncommercial educational service while simultaneously shrinking
the total number of listeners—which, it asserts, would somehow be
inequitable or unfair within the meaning of Section 307(b). Br. 28-31.
Putting aside whether such a result would suffice to show that the threshold is
an unreasonable interpretation of the statute—which is far from clear—the
hypothetical is baseless because (1) it could not have occurred here, and (2) it
is unlikely to occur anywhere.
As the Harris Foundation concedes (Br. 29), the gamesmanship of
which it warns could not actually have happened in this case. Under the NCE
Order, applicants with then-pending applications, such as the Harris
Foundation and Holy Family, were not permitted “to alter their technical
proposals…for purposes of enhancing their comparative positions.” Letter
Decision at 5 (JA__); see NCE Recon Order, 16 FCC Rcd at 5085-86, ¶ 31.
In any event, even if framed as a facial challenge—and it is unclear if
the Harris Foundation is making such an argument—such a hypothetical is
30

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 40 of 67
unlikely even going forward with new applications. Under the rules, an
applicant chooses a restricted service area at its own peril. When more than
one applicant passes the 10 percent threshold, the applicant that provides first
or second noncommercial educational service to the most listeners is selected,
as long as the difference is at least 5,000 people. 47 C.F.R. § 73.7002(b).
And where the threshold is not dispositive, candidates receive points under
the “technical” factor for serving significantly more listeners and area. Id. at
§ 73.7003(b)(4). Because an applicant may need to vie against another
applicant based on these factors, a candidate is unlikely to gain an advantage
by purposely shrinking its service area solely to qualify for the fair
distribution threshold. Through these safeguards, “[t]he Commission’s
procedures encourage applicants to apply for the facilities that they wish to
4
construct.” Letter Decision at 5 (JA__).

4 For the same reason, the rules do not encourage applicants to propose
service to a high percentage of first and second noncommercial educational
service “in a relatively small service area” in order to win a fair distribution
preference, and then “later enlarge the service area after the construction
permit is issued” by the agency, as the Harris Foundation alleges. Br. 31.
Putting aside whether this would even be permissible given the holding
period required by the rules, see 47 C.F.R. § 73.7005(b), an applicant cannot
be confident it will receive the dispositive preference in the first place.
31

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 41 of 67

B. The FCC reasonably explained its decision to implement

the fair distribution threshold.
In addition to arguing that the 2000 rules are inconsistent with the
statute, the Harris Foundation also argues that the FCC acted arbitrarily and
capriciously in implementing the fair distribution threshold by failing to
explain those rules. Br. 31-38. The Court’s review under the arbitrary and
capricious standard is “necessarily deferential,” and the Court “will not
intervene unless the Commission failed to consider relevant factors or made a
manifest error in judgment.” Consumer Elecs. Ass’n, 347 F.3d at 300.
Moreover, an agency is not subject to “more searching review” or a
“heightened duty” when it changes course from a previous policy, provided it
“display awareness that it is changing position” and provides a reasonable
explanation for the new policy. Fox Television, 556 U.S. at 515.
To be sure, the 10 percent threshold and points system represented a
departure from the prior procedure, including the prior policy that “permitted
[an ALJ] to give whatever weight he deem[ed] appropriate” to Section 307(b)
factors. New York University, 10 Rad. Reg. 2d at 217, ¶ 8 (FCC Add. 2). But
the FCC acknowledged and explained this change of course. It explained that
the new rules would “eliminate the vagueness and unpredictability of the
[previous] system” with a framework that is both more objective and more
efficient. NCE Order, 15 FCC Rcd at 7394, ¶ 18. The agency specifically
32

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 42 of 67
found that the new fair distribution threshold “is more readily adapted to [the
noncommercial educational] points system, and more consistent with [the]
ongoing goal to evaluate applications quickly, with minimal burden on
applicants and on the staff.” Id. at 7397, ¶ 21.
Indeed, the Harris Foundation conceded in a pleading before the FCC
that the agency had “explained that the formula is designed to balance the
opportunities for new stations in both large and small communities,” a goal
the Harris Foundation described as “worthy.” Harris Foundation 2007
Petition to Deny at 6 (JA__). The Harris Foundation would prefer that the
agency strike a different balance, but Congress has delegated discretion to the
5
agency in balancing these goals. See Alvin Lou Media, 571 F.3d at 11.

5 Contrary to the Harris Foundation’s argument (Br. 37-38), the use of a
percentage threshold is fully consistent with the FCC’s recent adoption of a
rule in favor of applicants owned or controlled by Indian Tribes who provide
the first noncommercial educational service to Tribal lands. See 47 C.F.R.
§ 73.7002(b); Policies to Promote Rural Radio Service and to Streamline
Allotment and Assignment Procedures
, First Report and Order, 25 FCC Rcd
1583, 1587-89, ¶¶ 7-10 (2010). In the case of the Tribal preference, there is
no need to compare applicants using a percentage threshold of first or second
noncommercial educational service because the Tribal rule is already
constructed to favor applicants who serve these sparsely populated areas. See
id.
at 1587, ¶ 8. Therefore, in the perhaps unlikely event that more than one
applicant seeks to provide the first noncommercial educational service to
these historically unserved areas, it is rational to pick the candidate that
would serve the most people on Tribal lands.
33

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 43 of 67

II.

THE COMMISSION DID NOT ABUSE ITS DISCRETION
IN DENYING A WAIVER OF THE 10 PERCENT
THRESHOLD.

Conceding that it does not qualify for the 10 percent dispositive
preference by its terms (Br. 38), the Harris Foundation next argues that the
agency erred in not waiving the rule and awarding it a dispositive preference
anyway. Br. 38-41. This Court’s review in such cases is “extremely
limited”— it will “vacate the denial of a waiver only when the agency’s
reasons are so insubstantial as to render that denial an abuse of discretion.”
Blanca Tel. Co., 743 F.3d at 864 (quoting BDPCS, Inc., 351 F.3d at 1181).
The agency did not abuse that broad discretion here. As the Bureau
explained in denying the waiver, the Commission set the benchmark at 10
percent “to ensure that only the most significant differences would be
decisional.” Letter Decision at 5 (JA__). An agency “has wide discretion to
determine where to draw administrative lines,” AT&T Corp. v. FCC, 220
F.3d 607, 627 (D.C. Cir. 2000), and, as the Bureau explained below, it “must
necessarily draw numerical lines in establishing threshold qualifications.”
Letter Decision at 4-5 (JA__). Any bright-line rule can create cases in which
a candidate is close to, but short of a line, but that alone is not good cause for
a waiver. See BellSouth Corp. v. FCC, 162 F.3d 1215, 1225 (D.C. Cir. 1999)
(waiver of bright-line rule not merited where “a waiver applicant seeks to
34

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 44 of 67
circumvent a rule merely because it does so only minimally”). In this case,
the agency moved to a set of objective rules both to promote efficiency and to
mitigate the arbitrary nature of the previous regime. NCE Order, 15 FCC
Rcd at 7396, ¶ 22. Waiver of those rules in close cases, without further
6
extenuating circumstances, would compromise those goals.
The Bureau also found that the Harris Foundation’s plea for a waiver
was not meaningfully different from that of Central Florida, which the
Commission had already denied. Letter Decision at 4 (JA__); see pp. 15-16
above. Central Florida had likewise argued that it merited a fair distribution
preference because it would offer new noncommercial educational service to
close to 10 percent of its population and more people than its competitors. As
the Commission explained, there was nothing “anomalous” about such a
situation—an applicant in a more populous area is likely to provide

6 Indeed, in this same proceeding, the Bureau also declined a request
from Intervenor Holy Family to waive a different “de minimis” failure to
satisfy the rules—a denial with which the Harris Foundation agreed. Letter
Decision
at 5 (JA__). In that instance, Holy Family argued that the Bureau
should overlook the one-square-kilometer overlap in the service area of its
proposed and existing operations. Letter Decision at 5 (JA__). The Bureau
refused, explaining that even a de minimis overlap was cognizable under the
rules. Id.; see also Harris Foundation Reply to Opposition to Petition to
Deny
at 5 (JA__) (where a party seeks a “waiver in order to obtain a benefit,”
FCC practice is to deny “even when the violation might be characterized as
‘de minimis’”).

35

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 45 of 67
noncommercial educational service to more people, and the purpose of the 10
percent threshold is to ensure that such an application is not unfairly preferred
over those of applicants in comparatively sparsely populated areas. Omnibus
Order ¶ 30 (JA__). The same logic applied in this case. Letter Decision at 4
(JA__).
Moreover, granting a fair distribution preference based on differences
in proposed new service that are not “significant” under the rules would
wholly cut off consideration of other regulatory objectives that are evaluated
under the points system, such as diversity of ownership and local control.
The FCC set a relatively high threshold recognizing that “there may not be a
large number of cases in which Section 307(b) issues will be dispositive.”
NCE Order, 15 FCC Rcd at 7397, ¶ 24. A waiver here would have
compromised the agency’s interest in furthering the other objectives secured
by the points system, as well as Holy Family’s interest in seeing the rules
neutrally applied so that it could vie for the license under that system.
In short, enforcement of the 10 percent threshold serves, rather than
undermines, the purposes of the fair distribution rule. Because the Harris
Foundation did not show good cause for a waiver, it cannot show that the
Commission abused its discretion here.
36

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 46 of 67

III. APPELLANT’S NOTICE-AND-COMMENT CHALLENGE

IS UNTIMELY AND, IN ANY EVENT, WITHOUT MERIT.

Finally, the Harris Foundation contends that the 10 percent threshold
was promulgated with inadequate notice and opportunity to comment under
the APA. Br. 41-48. That contention is time-barred and in any event
meritless.
The Hobbs Act allows a party “aggrieved” by a “final [agency] order”
to petition for review “within 60 days after its entry.” 28 U.S.C. § 2344. This
“statutory deadline is jurisdictional,” and challenges brought after 60 days are
generally time-barred. Cellular Telecomm. & Internet Ass’n v FCC, 330 F.3d
502, 508 (D.C. Cir. 2003). This Court has recognized an exception when a
party in an enforcement action challenges the substantive validity of a rule in
question. Functional Music, Inc. v. FCC, 274 F.2d 543, 546 (D.C. Cir.
1958). However, “challenges to the procedural lineage of agency
regulations, [even when] raised…as a defense to an agency enforcement
proceeding, will not be entertained outside the 60–day period provided by
statute.” JEM Broad., 22 F.3d at 325 (emphasis in original, quotation marks
and citations omitted); see also Indep. Cmty. Bankers of Am. v. Bd. of
Governors of Fed. Reserve Sys., 195 F.3d 28, 34 (D.C. Cir. 1999). “‘Strict
enforcement of the [statutory] time limit is necessary to preserve finality in
agency decisionmaking and to protect justifiable reliance on agency rules.’”
37

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 47 of 67
JEM Broad., 22 F.3d at 326 (quoting Raton Gas Transmission Co. v. FERC,
852 F.2d 612, 615 (D.C.Cir.1988)). Because the 60-day period to challenge
the 2000 NCE Order has long passed, the Harris Foundation cannot bring a
procedural challenge to the rule based on an alleged lack of notice and
7
opportunity to comment. Br. 41-53.
The challenge would be meritless in any case because the Section
307(b) fair distribution threshold is a logical outgrowth of the discussion in
the NCE NPRM. “A final rule is not a logical outgrowth of a proposed rule
when the changes are so major that the original notice did not adequately
frame the subjects for discussion.” Omnipoint Corp. v. FCC, 78 F.3d 620,
631 (D.C. Cir. 1996) (quotation marks and citations omitted). Here, the FCC
framed the subject for discussion in the NPRM in a way that amply
encompasses the 10 percent threshold that it ultimately adopted. The agency
announced that it sought an objective system that would need to account for
fair distribution of service under Section 307(b), although at that time it
contemplated doing so through awarding points for first and second

7 As a party with a pending application, the Harris Foundation had notice
of, and standing to challenge, the NCE Order when it was issued. Even had it
not, however, other parties had motive and opportunity to challenge, and the
interest in finality would outweigh the interest of the party against whom the
rule is later enforced in bringing a procedural challenge. JEM Broad., 22
F.3d at 326.
38

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 48 of 67
noncommercial educational service. See NCE NPRM, 13 FCC Rcd at 21177-
78, ¶ 21. The agency also made clear more generally that it aimed to
construct rules that avoided unfairly favoring larger service populations,
explaining that it would evaluate the “technical” factors based on area as well
as population. Id. at 21178, ¶ 22. Though that specific proposal centered on
the technical factors for evaluation rather than a fair distribution threshold,
the NCE NPRM made clear that the FCC wished to construct rules that
balanced opportunities for applicants serving populous and less populous
areas—the concern that underlies the 10 percent threshold that the agency
eventually adopted.
The Harris Foundation concedes that the general approach adopted in
the rules “was not inconsistent” with the NCE NPRM. Br. 42. In particular,
it acknowledges that evaluating fair distribution of service as a threshold
matter is a logical outgrowth of the NPRM and previous practice. Id. It
complains only that parties had inadequate notice of the specific mechanism
of a 10 percent numerical threshold. Id. at 43. But as the Harris Foundation
also recognizes, the final rule responded to, and was in large part based on,
comments by a party. Br. 50. The FCC acted “well within its authority
when it chose” to implement its already stated objective through a numeric
threshold “based on comments” from a party. Omnipoint Corp., 78 F.3d at
39

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 49 of 67
632; see also Covad Commc’ns Co. v. FCC, 450 F.3d 528, 549 (D.C. Cir.
2006).
After all, “the notice-and-comment requirements presume that the
contours of the agency’s final rule may differ from those of the rule it initially
proposes in an NPRM.” Crawford v. FCC, 417 F.3d 1289, 1295 (D.C. Cir.
2005). It is only those modifications that are not logical outgrowths of the
notice that require an additional notice and opportunity to comment. Here,
the Commission made clear in its notice that it was seeking an objective
system that would account for fair distribution of service, and also made clear
more generally that it wished to avoid unduly favoring applicants serving
large populations. It was no great surprise, then, when the agency adopted
the proposal to use a specific numeric threshold to evaluate this characteristic.
No party, including the Harris Foundation, sought to bring a notice-and-
comment challenge to the threshold at the time of the rule’s adoption. See
generally NCE Recon Order, 16 FCC Rcd at 5087-89, ¶¶ 35-44 (discussing
other challenges and requests for clarification); pp. 12-13 above (discussing
40

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 50 of 67
8
court challenges to the 2000 rule). The Harris Foundation brings one now,
too late, not because the rule was unexpected but because it is displeased with
the result of its application.

CONCLUSION

The appeal should be dismissed in part for lack of jurisdiction, and
otherwise denied.

8 The Harris Foundation’s allegation (Br. 43) that the FCC “cut off” and
“blocked further comment” is misplaced. The agency issued two Orders on
Reconsideration, but no one argued after the rule was issued that the 10
percent threshold is unlawful or arbitrary. See p. 12 above; see also
Reexamination of Competitive Standards for Noncommercial Educ.
Applicants
, Memorandum Opinion and Second Order on Reconsideration, 17
FCC Rcd 13132 (2002).
41

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 51 of 67
Respectfully
submitted,

JONATHAN B. SALLET
ACTING GENERAL COUNSEL

DAVID M. GOSSETT
ACTING DEPUTY GENERAL
COUNSEL

RICHARD K. WELCH
DEPUTY ASSOCIATE GENERAL
COUNSEL

/s/ Matthew J. Dunne

MATTHEW J. DUNNE
COUNSEL

FEDERAL COMMUNICATIONS
COMMISSION
WASHINGTON, D.C. 20554
(202) 418-1740
April 30, 2014
42

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 52 of 67
IN THE UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT


MARY V. HARRIS FOUNDATION,
APPELLANT,
v.
NO. 13-1304

FEDERAL COMMUNICATIONS COMMISSION,
APPELLEE.



CERTIFICATE OF COMPLIANCE

Pursuant to the requirements of Fed. R. App. P. 32(a)(7), I hereby
certify that the accompanying Brief for Appellee in the captioned case
contains 8,676 words.

/s/ Matthew J. Dunne
Matthew J. Dunne

Counsel
Federal Communications Commission
Washington, D.C. 20554
(202) 418-1740 (Telephone)
(202) 418-2819 (Fax)
April 30, 2014



USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 53 of 67
 
 
 
 
 
 
 
 
 
 

ADDENDUM


Telecommunications Law Resource Center
http://telecomlaw.bna.com/terc/display/batch_print_display.adp?searchid...
USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 54 of 67
Source: Communications Cases > Federal Communications Commission > New York University, 10 RR2d 215 (FCC
1967)
10 RR2d 215

New York University

FCC 67-673

Federal Communications Commission

June 07, 1967

Headnotes

  ►CA.307(E)(17) ►1.593(M) ►73.24(A)(5)
“Boiler plate” 307(b) and standard comparative issues are not appropriate for mutually exclusive
non-commercial educational applications. In the case of applications of New York University and Fairleigh
Dickinson University (Teaneck, N.J.) for an FM station, any determination under the “available services"
issue should be limited to available educational FM signals within the respective service areas of the two
applicants. The Hearing Examiner should be permitted to give whatever weight he deems appropriate to
the origination point of such signals, i.e., whether a 307(b) determination under this standard should
include consideration of New York State-originated educational FM signals serving Fairleigh Dickinson's
proposed New Jersey service areas, and vice versa. An issue should also be specified as to the relative
integrated use of the requested FM facility proposed by each of the applicants in its overall educational
operation. The standard comparative criteria (local residence, integration, broadcast experience,
diversification, etc.) are virtually meaningless in a case of this type.

Opinion

NEW YORK UNIVERSITY New York, New York, Requests: 89.1 mc, #206; 8.3 kw(H); 7.7 kw(V); 220 ft.;
FAIRLEIGH DICKINSON UNIVERSITY Teaneck, New Jersey, Requests: 89.1 mc, #206; 550 w(H); 550 w(V);
500 ft. , For Construction Permits

FCC 67-673
Mimeo 1260
Docket No. 17454, File No. BPED-742, Docket No. 17455, File No. BPED-751
June 8, 1967, Released; Adopted
June 7, 1967
By the Commission: (Chairman Hyde absent).
MEMORANDUM OPINION AND ORDER
By the Commission: (Chairman Hyde absent).

1. On May 17, 1967, the Commission adopted a Memorandum Opinion and Order designating for hearing the
applications of New York University (Docket No. 17454, File No. BPED-742), and Fairleigh Dickinson University
(Docket No. 17455, File No. BPED-751) on Section 307(b) and comparative issues. 1 The background of this
proceeding was set forth in that Order (FCC 67-607) and need not be repeated here. However, the
Commission on its own motion on May 24, 1967, pursuant to Sec. 1.108 of the Rules, has reconsidered the
aforesaid designation order and has determined that it should be modified in the following respects.
2. The designation order recites the “boiler plate” 307(b) and standard comparative issues. 2 Upon
reconsideration, we do not believe that such traditional issues are appropriate in the instant case.
3. A review of the Commission's records indicates that we have not previously designated two non-commercial
educational applications for comparative hearing. Accordingly, the Commission has not previously had occasion
to state with specificity the precise issues which would be of decisional significance in such a proceeding. We

FCC Add. 1

1 of 3
4/30/2014 10:49 AM

Telecommunications Law Resource Center
http://telecomlaw.bna.com/terc/display/batch_print_display.adp?searchid...
USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 55 of 67
feel it appropriate that we take this occasion to delineate appropriate issues.
4. We note that in at least one other instance there are competing non-commercial educational applicants
before the Commission for a reserved educational television channel. In addition, with the lack of available
spectrum becoming more pronounced, it is reasonable to assume that we will be faced with other instances in
which two or more educational organizations will be compelled to proceed through the hearing process in order
for one applicant to obtain a reserved FM or TV assignment.
5. Compounding the problem in this case, is the fact that the applicants are located in New York, New York and
Teaneck, New Jersey, respectively. This, on its face, raises in the traditional sense a 307(b) issue. Additional
307(b) implications are raised by the disparity in power and radiation patterns proposed by the two applicants.
We are not persuaded that our traditional areas and populations, and other available services criteria are
appropriate in this instance, nor are we persuaded that the factors involved in the usual standard comparison 3
are appropriate in the context of this proceeding.
6. Our reconsideration is primarily founded on our desire to avoid round after round of interlocutory pleadings
and appeals which would not only involve unnecessary expense to the two applicants, but would be much more
wasteful than necessary of Commission staff time at the Broadcast Bureau, Hearing Examiner and Review
Board levels, and of the time of the Commission itself. Therefore, we will modify the issues in this proceeding
as set forth below.
7. The initial FM educational reservations were made by the Commission early in 1938. See Rules 1057 and
1058, 3 FR 312. Even at that initial stage the intention was that such a facility be made available to the
applicant “for the advancement of its educational work and for the transmission of educational and
entertainment programs to the general public”. However, the rules then adopted also provided that a
non-commercial station would be licensed “only to an organized non-profit educational agency and upon a
showing that the station will be used for the advancement of the agency's educational program”. The
Commission has never squarely faced the question of whether these reservations were intended strictly as
educational tools or were planned to be hybrid facilities to serve that end, as necessary, and during the
remainder of the time to serve as additional available conventional, although non-commercial, broadcast
outlets.
8. It becomes obvious from the foregoing discussion that we are faced in this proceeding with unique questions.
One of the applicants has submitted material indicating that as many as 51 FM signals are available in some
part of the respective service areas proposed by the two applicants. We are thus faced with the question of
whether “available services” within the context of a Section 307(b) determination should include both operating
commercial and educational stations. In light of our determination that the Commission's purpose in reserving
educational channels at the lower end of the FM band was to establish a separate and independent service, we
believe that any determination under the “available services” issue should be limited to available educational
FM signals within the respective service areas of the two applicants. In addition, we believe that the Hearing
Examiner should be permitted to give whatever weight he deems appropriate to the origination point of such
signals: i. e., whether a 307(b) determination under this standard should include consideration of New York
State-originated educational FM signals serving Fairleigh Dickinson's proposed New Jersey service areas, and
vice versa. We further believe that an issue should be specified as to the relative integrated use of the
requested FM facility proposed by each of the applicants in its overall educational operation. In adopting these
issues in a case of first impression, we further note that our standard comparative criteria (local residence,
integration, broadcast experience, diversification, etc.) are virtually meaningless in a case of this type.
9. Accordingly, it is ordered that Issues 2 and 3 are modified as follows:
Issue 2 is modified as follows:
2. To determine the number of other reserved-channel educational FM services available in the proposed
service area of each applicant, and the areas and populations served thereby.
Issue 3 is modified as follows:
3. To determine the extent to which each of the proposed operations will be integrated into the overall
educational operation and objectives of the respective applicants; or whether other factors in the record
demonstrate that one applicant will provide a superior FM educational broadcast service.
10. In all other respects, our Memorandum Opinion and Order adopted May 17, 1967 (FCC 67-607) is affirmed.

End Notes

   1.   An issue was also specified as to whether NYU's tower would constitute a menace to air navigation.
   2.   The standard comparative issues would be those considered within the terms of the Commission's

FCC Add. 2

2 of 3
4/30/2014 10:49 AM

Telecommunications Law Resource Center
http://telecomlaw.bna.com/terc/display/batch_print_display.adp?searchid...
USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 56 of 67
Policy Statement on Comparative Broadcast Hearings, 5 RR 2d 1901
   3.   See Policy Statement on Comparative Broadcast Hearings, supra.
Contact us at http://www.bna.com/contact/index.html or call 1-800-372-1033
ISSN 2158-8589
Copyright © 2014, The Bureau of National Affairs, Inc. Reproduction or redistribution, in whole or in part, and in any
form, without express written permission, is prohibited except as permitted by the BNA Copyright Policy.

FCC Add. 3

3 of 3
4/30/2014 10:49 AM

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 57 of 67













STATUTORY APPENDIX



















47 U.S.C. § 307(a)-(b)

47 C.F.R. § 73.7002
47 C.F.R. § 73.7003










USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 58 of 67
47 U.S.C. § 307




UNITED STATES CODE ANNOTATED
TITLE 47. TELEGRAPHS, TELEPHONES, AND
RADIOTELEGRAPHS
CHAPTER 5. WIRE OR RADIO COMMUNICATION
SUBCHAPTER III. SPECIAL PROVISIONS RELATING TO RADIO
PART I. GENERAL PROVISIONS

§ 307. Licenses

(a) Grant

The Commission, if public convenience, interest, or necessity will be served
thereby, subject to the limitations of this chapter, shall grant to any applicant
therefor a station license provided for by this chapter.

(b) Allocation of facilities

In considering applications for licenses, and modifications and renewals
thereof, when and insofar as there is demand for the same, the Commission
shall make such distribution of licenses, frequencies, hours of operation, and
of power among the several States and communities as to provide a fair,
efficient, and equitable distribution of radio service to each of the same.



* * * * * *



USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 59 of 67
47 C.F.R. § 73.7002




CODE OF FEDERAL REGULATIONS
TITLE 47. TELECOMMUNICATION
CHAPTER I. FEDERAL COMMUNICATIONS COMMISSION
SUBCHAPTER C. BROADCAST RADIO SERVICES
PART 73. RADIO BROADCAST SERVICES
SUBPART K. APPLICATION AND SELECTION PROCEDURES
FOR RESERVED NONCOMMERCIAL EDUCATIONAL
CHANNELS, AND FOR CERTAIN APPLICATIONS FOR
NONCOMMERCIAL EDUCATIONAL STATIONS ON NON–
RESERVED CHANNELS

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

(a) If timely filed applications for full service stations on reserved FM
channels are determined to be mutually exclusive, and will serve different
communities, the Commission will first determine, as a threshold issue,
whether grant of a particular application would substantially further the fair
distribution of service goals enunciated in section 307(b) of the
Communications Act, 47 U.S.C. 307(b).

(b) In an analysis performed pursuant to paragraph (a) of this section, a full-
service FM applicant that identifies itself as a Tribal Applicant, that
proposes Tribal Coverage, and that proposes the first reserved channel NCE
service owned by any Tribal Applicant at a community of license located on
Tribal Lands, will be awarded a construction permit. If two or more full-
service FM applicants identify themselves as Tribal Applicants and meet the
above criteria, the applicant providing the most people with reserved channel
NCE service to Tribal Lands will be awarded a construction permit,
regardless of the magnitude of the superior service or the populations of the
communities of license proposed, if different. If two or more full-service FM
applicants identifying themselves as Tribal Applicants each meet the above

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 60 of 67
47 C.F.R. § 73.7002
Page 2

criteria and propose identical levels of NCE aural service to Tribal Lands,
only those applicants shall proceed to be considered together in a point
system analysis. In an analysis performed pursuant to paragraph (a) of this
section that does not include a Tribal Applicant, a full service FM applicant
that will provide the first or second reserved channel noncommercial
educational (NCE) aural signal received by at least 10% of the population
within the station's 60dBu (1mV/m) service contours will be considered to
substantially further fair distribution of service goals and to be superior to
mutually exclusive applicants not proposing that level of service, provided
that such service to fewer than 2,000 people will be considered insignificant.
First service to 2,000 or more people will be considered superior to second
service to a population of any size. If only one applicant will provide such
first or second service, that applicant will be selected as a threshold matter.
If more than one applicant will provide an equivalent level (first or second)
of NCE aural service, the size of the population to receive such service from
the mutually exclusive applicants will be compared. The applicant providing
the most people with the highest level of service will be awarded a
construction permit, if it will provide such service to 5,000 or more people
than the next best applicant. If none of the applicants in a mutually exclusive
group would substantially further fair distribution goals, all applicants will
proceed to examination under a point system. If two or more applicants will
provide the same level of service to an equivalent number of people
(differing by less than 5,000), only those equivalent applicants will be
considered together in a point system.

(c) For a period of four years of on-air operations, an applicant receiving a
decisive preference pursuant to this section is required to construct and
operate technical facilities substantially as proposed and shall not downgrade
service to the area on which the preference was based. Additionally, for a
period beginning from the award of a construction permit through four years

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 61 of 67
47 C.F.R. § 73.7002
Page 3

of on-air operations, a Tribal Applicant receiving a decisive preference
pursuant to this section may not:

(1) Assign or transfer the authorization except to another party that
qualifies as a Tribal Applicant;

(2) Change the facility's community of license; or

(3) Effect a technical change that would cause the facility to provide less
than full Tribal Coverage.




USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 62 of 67
47 C.F.R. § 73.7003




CODE OF FEDERAL REGULATIONS
TITLE 47. TELECOMMUNICATION
CHAPTER I. FEDERAL COMMUNICATIONS COMMISSION
SUBCHAPTER C. BROADCAST RADIO SERVICES
PART 73. RADIO BROADCAST SERVICES
SUBPART K. APPLICATION AND SELECTION PROCEDURES
FOR RESERVED NONCOMMERCIAL EDUCATIONAL
CHANNELS, AND FOR CERTAIN APPLICATIONS FOR
NONCOMMERCIAL EDUCATIONAL STATIONS ON NON–
RESERVED CHANNELS

§ 73.7003 Point system selection procedures.

(a) If timely filed applications for reserved FM channels or reserved TV
channels are determined to be mutually exclusive, applications will be
processed and assessed points to determine the tentative selectee for the
particular channels. The tentative selectee will be the applicant with the
highest point total under the procedure set forth in this section, and will be
awarded the requested permit if the Commission determines that an award
will serve the public interest, convenience, and necessity.

(b) Based on information provided in each application, each applicant will
be awarded a predetermined number of points under the criteria listed:

(1) Established local applicant. Three points for local applicants as
defined in § 73.7000 who have been local continuously for no fewer than
the two years (24 months) immediately prior to application, if the
applicant's own governing documents (e.g. by-laws, constitution, or their
equivalent) require that such localism be maintained.



USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 63 of 67
47 C.F.R. § 73.7003
Page 2

(2) Local diversity of ownership. Two points for applicants with no
attributable interests as defined in § 73.7000, in any other broadcast
station or authorized construction permit (comparing radio to radio and
television to television) whose principal community (city grade) contour
overlaps that of the proposed station, if the applicant's own governing
documents (e.g. by-laws, constitution, or their equivalent) require that
such diversity be maintained. The principal community (city grade)
contour is the 5 mV/m for AM stations, the 3.16 mV/m for FM stations
calculated in accordance with § 73.313(c), and the contour identified in §
73.685(a) for TV. Radio applicants will count commercial and
noncommercial AM, FM, and FM translator stations other than fill-in
stations. Television applicants will count UHF, VHF, and Class A
stations.

(3) State-wide network. Two points for an applicant that does not qualify
for the credit for local diversity of ownership, if it is:

(i) An entity, public or private, with authority over a minimum of 50
accredited full-time elementary and/or secondary schools within a single
state, encompassed by the combined primary service contours of the
proposed station and its existing station(s), if the existing station(s) are
regularly providing programming to the schools in furtherance of the
school curriculum and the proposed station will increase the number of
schools it will regularly serve; or

(ii) An accredited public or private institution of higher learning with a
minimum of five full time campuses within a single state encompassed
by the combined primary service contours of the proposed station and its
existing station(s), if the existing station(s) are regularly providing

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 64 of 67
47 C.F.R. § 73.7003
Page 3

programming to campuses in furtherance of their curriculum and the
proposed station will increase the number of campuses it will regularly
serve; or

(iii) An organization, public or private, with or without direct authority
over schools, that will regularly provide programming for and in
coordination with an entity described in paragraph (b)(3)(i) or (ii) of this
section for use in the school curriculum.

(iv) No entity may claim both the diversity credit and the state-wide
network credit in any particular application.

(4) Technical parameters. One point to the applicant covering the largest
geographic area and population with its relevant contour (60 dBu for FM
and Grade B for TV), provided that the applicant covers both a ten
percent greater area and a ten percent greater population than the
applicant with the next best technical proposal. The top applicant will
receive two points instead of one point if its technical proposal covers
both a 25 percent greater area and 25 percent greater population than the
next best technical proposal.)

(c) If the best qualified (highest scoring) two or more applicants have the
same point accumulation, the tentative selectee will be determined by a tie-
breaker mechanism as follows:

(1) Each applicant's number of attributable existing authorizations
(licenses and construction permits, commercial and noncommercial) in
the same service (radio or television) nationally, as of the time of
application shall be compared, and the applicant with the fewest
authorizations will be chosen as tentative selectee. Radio applicants will

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 65 of 67
47 C.F.R. § 73.7003
Page 4

count commercial and noncommercial AM, FM, and FM translator
stations other than fill-in stations. Television applicants will count UHF,
VHF, and Class A stations.

(2) If a tie remains after the tie breaker in paragraph (c)(1) of this section,
the tentative selectee will be the remaining applicant with the fewest
pending new and major change applications in the same service at the
time of filing;

(3) If a tie remains after the tie breaker in paragraph (c)(2) of this section,
each of the remaining applicants will be identified as a tentative selectee,
with the time divided equally among them.

(d) Settlements. At any time during this process, the applicants may advise
the Commission that they are negotiating or have reached settlement, and the
Commission will withhold further comparative processing for a reasonable
period upon such notification. Settlement may include an agreement to share
time on the channel voluntarily or other arrangement in compliance with
Commission rules. Parties to a settlement shall comply with § 73.3525,
limiting any monetary payment to the applicant's reasonable and prudent
expenses.

(e) For applications filed after April 21, 2000, an applicant's maximum
qualifications are established at the time of application and will be reduced
for any post-application changes that negatively affect any evaluation
criterion.

(f) For applications filed on or before April 21, 2000, an applicant's
maximum qualifications are established as of the relevant date listed in
paragraph (f)(1), (2), or (3) of this section. After the relevant date for

USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 66 of 67
47 C.F.R. § 73.7003
Page 5

determining an applicant's maximum points, points will be reduced for any
changes that negatively affect any evaluation criterion. Applicants will
establish their qualifications according to the following:

(1) If the applicant is in a group for which a “B” cut-off notice issued
prior to April 21, 2000 its maximum non-technical qualifications are
established as of the date by which applicants must supplement their
applications to supply point information, and its maximum technical
qualifications are established as of the date of the “B” cut-off notice;

(2) If the applicant is in a group for which an “A” cut-off notice issued
prior to April 21, 2000 but for which no “B” cut-off notice issued, its
maximum non-technical qualifications are established as of the date by
which applicants must supplement their applications to supply point
information, and its maximum technical qualifications are established as
of April 21, 2000;

(3) If the applicant was neither placed on an “A” cut-off list prior to April
21, 2000 nor filed in response to such an “A” cut-off list, it is subject to
competition from applications filed within the first filing window, and its
maximum technical and non-technical qualifications will be determined
as of the close of the first filing window.




USCA Case #13-1304 Document #1490819 Filed: 04/30/2014 Page 67 of 67

13-1304


IN THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT



Mary V. Harris Foundation,
Appellant,

v.

Federal Communications Commission,



Appellee.


CERTIFICATE OF SERVICE



I, Matthew J. Dunne, hereby certify that on April 30, 2014, I electronically
filed the foregoing Brief for Appellee with the Clerk of the Court for the
United States Court of Appeals for the D.C. Circuit by using the CM/ECF
system. Participants in the case who are registered CM/ECF users will be
served by the CM/ECF system.

Some of the participants in the case, denoted with asterisks below, are not
CM/ECF users. I certify further that I have directed that copies of the
foregoing document be mailed by First-Class Mail to those persons, unless
another attorney at the same mailing address is receiving electronic service.


Donald E. Martin, P.C.
Denise B. Moline, Esq.
P.O. Box 8433
358 Pines Blvd.
Falls Church, Virginia 22041
Lake Villa, IL 60046-6600
Counsel for: Mary V. Harris
Counsel for: Holy Family
Foundation
Communications, Inc.





/s/ Matthew J. Dunne

Note: We are currently transitioning our documents into web compatible formats for easier reading. We have done our best to supply this content to you in a presentable form, but there may be some formatting issues while we improve the technology. The original version of the document is available as a PDF, Word Document, or as plain text.

close
FCC

You are leaving the FCC website

You are about to leave the FCC website and visit a third-party, non-governmental website that the FCC does not maintain or control. The FCC does not endorse any product or service, and is not responsible for, nor can it guarantee the validity or timeliness of the content on the page you are about to visit. Additionally, the privacy policies of this third-party page may differ from those of the FCC.