**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

In re Application of )

)

)

**High I-Q Radio, Inc.** )

)

Noncommercial Educational FM Station ) Facility ID No. 78344

KOLI(FM), Electra, Texas )

)

Application for License to Cover Construction )

Permit ) File No. BLH-980203KB

) Application for Assignment of Construction ) File No. BAPH-980421HW

Permit to Cumulus Licensing Corp. )

#  MEMORANDUM OPINION AND ORDER 

**Adopted: March 17, 2004 Released: April 21, 2004**

By the Commission: Commissioner Martin concurring and issuing a
statement; Commissioners Copps and Adelstein concurring in part,
dissenting in part, and issuing a joint statement.

1\. The Commission has before it two applications for review filed by
Apex Broadcasting, L.L.C.[^1] ("Apex"), regarding the captioned
applications of High I-Q Radio, Inc. ("High"), former licensee of
station KOLI(FM), Electra, Texas. In the first application for review,
filed on October 13, 1998, Apex seeks review of a September 14, 1998,
action by the Mass Media Bureau ("Bureau") which denied Apex's February
8, 1998, "Petition for Emergency Relief" and its May 20, 1998, Informal
Objection to the captioned KOLI(FM) license application ("1998 Letter
Decision").[^2] In the second application for review, filed on September
13, 1999, Apex seeks review of the Bureau's August 10, 1999, letter
decision which both denied Apex' petition to deny the application to
assign the station from High to Cumulus Licensing Corporation
("Cumulus") and granted the KOLI(FM) license and assignment applications
("1999 Letter Decision"). For the reasons set forth below, we will (1)
deny Apex' October 13, 1998, application for review, (2) grant the
September 13, 1999, application for review in part and deny it in part;
and (3) issue admonitions to both High and Cumulus.

### Factual Background

2\. On November 8, 1995, High applied for a construction permit to build
a new noncommercial educational ("NCE") FM station on non-reserved
channel 235C2 at Electra, Texas. Electra is located approximately 25
miles from the larger community of Wichita Falls. The Commission granted
the application on May 23, 1996.

3\. On June 3, 1997, applications were filed which proposed the
assignment of three station licenses in the Wichita Falls area to
Cumulus. The Commission granted these applications on October 3, 1997.
On December 2, 1997, Cumulus closed on the transactions and became the
licensee of stations KLUR-FM and KQXC(FM), Wichita Falls and KYYI(FM),
Burkburnett, Texas.

4\. Shortly after the filing of the referenced assignment applications,
Cumulus commenced discussions with High about its Electra permit. By
letter dated July 28, 1997, Cumulus proposed to pay Larry Hickerson
("Hickerson"), High's then president, \$10,000 not to sell, offer to
sell, or solicit an offer to sell the permit to anyone other than
Cumulus for a period of 14 days. Cumulus also proposed that it and High
"agree to negotiate promptly and in good faith toward the preparation
and execution" of a Memorandum of Understanding ("MOU") in the form
attached to the letter. Hickerson signed the letter that day. According
to a declaration later submitted by Hickerson, he sought the Electra
authorization because he had intended to return to Texas, his home
state. However, Hickerson stated that he subsequently developed heart
and lung problems in 1997, which caused him to remain in Georgia and
resulted in several hospitalizations.[^3]

5\. On August 8, 1997, Cumulus' Chairman, Richard Weening ("Weening"),
executed the MOU. Hickerson, on behalf of High, signed the MOU three
days later. The MOU recited that Cumulus would acquire the equipment
necessary to operate the radio station and lease it to High. Cumulus
also agreed to loan High sufficient working capital to construct and
commence operations. The MOU also provided that, for \$27,600, High
would give Cumulus an assignable option to acquire the station's assets.
The option would be exercisable for a one-year period beginning with the
commencement of station operations. In the event Cumulus exercised the
option, it promised to pay \$238,400 for the station's assets upon
finality of the grant of an assignment application.[^4] Cumulus would
also assume all indebtedness under loans made by Cumulus to High. The
MOU further provided that the parties would enter into a time brokerage
agreement under which Cumulus would program the station from its
commencement of operation and pay High's monthly expenses, plus \$500
per month. The MOU stipulated that High was to file a copy of that
agreement with the Commission.[^5]

6\. By letter dated August 22, 1997, Weening arranged for Jack Sellmeyer
("Sellmeyer") to provide overall engineering services in connection with
the construction of the station. Although Weening informed Sellmeyer
that his invoices should be sent to Cumulus, Weening also stated that
Hickerson was Sellmeyer's client. Further, Weening advised Sellmeyer of
Hickerson's plan to do a live morning show and his desire to have
installed a "20 channel Pacific Recorder board manufactured by AirWav."
With respect to the tower, Weening stated that "the design should be
mindful of the fact that this system will likely be relocated .... For
this reason ... every effort should be made to find a used tower."
Sellmeyer coordinated the bidding process for the purchase of equipment.
Specifically, he requested and received proposals from equipment vendors
and worked with Cumulus to place orders. Sellmeyer also supervised Jeff
Chancey ("Chancey"), a technician in the Wichita Falls area, in the
construction of the station. Sellmeyer also averred that he had several
telephone conversations with Hickerson regarding station construction
and the preparation of license and STL (studio-to-transmitter link)
applications.

7\. In September 1997, Hickerson negotiated a lease for the transmitter
site and, on behalf of High, entered into a three-year lease. Upon
execution of the lease, High prepaid \$7,200 for three years' rent.
During that same month, Hickerson also worked with and later paid a
survey firm \$1,700 to determine the exact tower location.

8\. *1997 Extension Application*. On October 22, 1997, High filed an
application signed by Hickerson, to extend the KOLI(FM) permit (File No.
BMPED-971022JA). Therein, High stated that: "A firm order was placed
with Harris Corporation on October 21, 1997, for all necessary
transmitting, antenna and studio-to-transmitter link equipment for the
station." High also reported that: "The studio and satellite equipment
is expected to be ordered from Harris Corporation on October 22, 1997."
High also indicated that a tower construction order had been placed.
Moreover, High stated: "The lease for the station's studio space has
been signed" and "the space has been built out." Finally, High reported
that it had entered into a tower site lease and had paid \$7,200 for
three years' rent. The application did not disclose Cumulus's role in
ordering equipment and constructing the station. The staff granted the
extension application on December 29, 1997.

9\. *Agreements between High and Cumulus*. On December 1, 1997, High and
Cumulus executed an option agreement, a time brokerage agreement
("TBA"), a loan agreement, and a lease agreement. During the pendency of
the extension application, none of the agreements were filed with or
otherwise disclosed to the Commission. The option agreement and TBA were
filed with the Commission in February 1998, and the loan and lease
agreements in June 1998.

10\. The option agreement recited that Cumulus had previously made a
non-refundable payment of \$27,600 to High.[^6] Exercise of the option
was solely at Cumulus' discretion. The purchase price was \$238,400, the
amount that had been set forth in the MOU. As part of the option
agreement, High and Cumulus agreed to the form of the asset purchase
agreement that was to be executed upon the option's exercise. Finally,
the option agreement stated that the loan and lease agreements would be
cancelled and the loan forgiven upon consummation of the asset purchase
agreement.

11\. The TBA gave Cumulus the right to program the station. High
retained the right to preempt or refuse to broadcast any program it
deemed contrary to the public interest and to schedule and present
public interest programming. High was to retain full authority over
station operations and was required to hire a station general manager.
Under the terms of the TBA High also was solely responsible for all of
the station's expenses. Cumulus was required to reimburse High for
itemized expenses on a monthly basis. Reimbursible expenses included,
*inter alia*, the general manager's salary, tower, transmitter site and
studio space rentals, insurance premiums, telephone and utilities.

12\. High's one-year, eight-percent loan was secured by a security
interest in all station assets other than the permit. The loan amount
included \$8,662.38 for expenses already incurred by High: namely, the
three-year lease and the payment due the surveyor. In addition, Cumulus
agreed to make additional loans to cover the salaries for a station
manager and contract engineer, lease expenses, insurance premiums,
utility deposits, and hook up fees. High was required to make a written
request for funds. High was also to maintain insurance and name Cumulus
as the insured. During the period of the loan, High could not, without
Cumulus' consent: acquire an interest in any other broadcast station;
pay any bonus to any station employee; enter into an employment contract
that was not terminable at will; provide any fringe benefit other than
regular wages; or enter into any other contract, lease or agreement
concerning the station with anyone other than Cumulus, unless the matter
was terminable on no more than 30 days notice without penalty or
payment.

13\. Pursuant to the lease agreement, Cumulus would lease to High an
antenna, a transmission line, a transmitter and related equipment,
antenna and transmitter space, a main studio and related equipment. High
was to pay \$500 per month for the rental of the tower and related
equipment, and an additional \$500 per month for the studio. The
station's studio and office space was at the same address as that for
KLUR-FM, one of the other stations that Cumulus was about to acquire.

14\. *Commencement of KOLI(FM) Operation*. KOLI(FM) station construction
was completed following Commission grant of the extension application.
On January 30, 1998, the station commenced operations as an NCE station.
Shortly thereafter, High submitted a covering license application signed
by Hickerson (File No. BLH-980203KB).[^7] Therein, High stated that "due
to a change in circumstances," it would operate KOLI(FM) as a commercial
station. On February 4, 1998, the station commenced airing commercials.
High also represented that it would file its ownership report by
February 6, 1998.[^8]

15\. On February 6, 1998, Apex, a competitor in the Wichita Falls
market, filed a petition for emergency relief. Specifically, Apex sought
revocation of High's program test authority. Apex argued that KOLI(FM)
was not authorized to operate as a commercial station and that High had
violated the Commission's public file rules. Included with Apex's
petition was a promotional document from Cumulus referencing, *inter
alia*, the cost of advertising on its "4^th^ station soon to be up and
running," an apparent reference to KOLI(FM). On February 19, 1998, High
filed an opposition to Apex's petition. In addition to responding to
Apex's commercial programming and the public file arguments, High
included a declaration from Hickerson and one from James Marks
("Marks"), who identified himself as Cumulus' marketing manager in the
Wichita Falls area. Among other things, Marks averred that he responded
to a February 2, 1998, inquiry about the location of KOLI(FM)'s public
file by stating that the caller would have to call Hickerson in Georgia
in order to ascertain the file's whereabouts.[^9]

16\. On May 20, 1998, Apex filed an informal objection to High's license
application, arguing that the "automatic program test authority" ("PTA")
provisions in Section 73.1620 apply only when construction is completed
in accordance with the terms of the station's license. Because KOLI
commenced operation as a commercial station, it was not operating in
accordance with its noncommercial educational authorization, claimed
Apex, and the staff should revoke KOLI's PTA. Apex also argued that High
violated the public inspection file rule, 47 C.F.R. § 73.3526, because
the KOLI public inspection file was in Brunswick, Georgia, nearly 1000
miles from Electra, Texas. The allegations and arguments from the
informal objection and related pleadings were repeated in a petition to
deny the subsequently filed assignment application.

17\. *KOLI(FM) Assignment Application*. On April 21, 1998, Cumulus and
High filed an application to obtain Commission consent to assign the
KOLI(FM) license.[^10] On June 1, 1998, Apex filed a petition to deny
the assignment application. In addition to repeating arguments made in
its earlier pleadings, Apex also argued that Cumulus and High had
engaged in a premature transfer of control based on Cumulus' financial
involvement and the alleged role of Marks, a Cumulus employee.[^11] In
support of its claims, Apex submitted copies of web sites prepared by
Cumulus for stations KOLI(FM), KQXC and KLUR-FM. Each listed Marks as
the station general manager. In addition, the sites for KOLI(FM) and
KLUR-FM stated that Jim Nash was the music director and that Jay
Phillips was the program director and web site designer.

18\. Both High and Cumulus opposed Apex's petition. In addition to
supplying the loan and lease agreements between itself and Cumulus, High
submitted the declaration of James Driskill ("Driskill"). Driskill
identified himself as KOLI(FM)'s general manager; stated that he became
KOLI(FM)'s general manager on January 30, 1998; and averred that he was
a full-time employee of High and solely compensated by it. In its
opposition, High reported that Driskill also served as KOLI(FM)'s music
director and as an air personality under the air name "Jim Nash." High
further acknowledged that Driskill provided services, "*for no
compensation*," (emphasis in the original) as music director to
KLUR-FM.[^12] High claimed that Driskill had no other connection with
KLUR-FM or Cumulus. High further contended that it had controlled and
continued to control the station's policy decisions in the areas of
programming, personnel, and finances. High noted that, under the TBA, it
had sole responsibility for ensuring that programming met the needs of
the community of Electra and that it employed Driskill to ensure that
High met its programming responsibilities. Regarding personnel and
finances, High averred that it had no relationship with Marks and that,
in addition to Driskill, KOLI(FM) had a staff employee. High stated that
it compensated both of its employees directly. Finally, High argued that
the loan and lease agreements imposed no undue burdens. In this regard,
High observed that, under the loan agreement, its obligation was merely
to repay the sums loaned. Moreover, if Cumulus did not purchase the
station and the TBA were terminated, High had the option of purchasing
the equipment from Cumulus. In sum, High argued that its arrangement
with Cumulus was structured in accordance with Commission precedent[^13]
and that it had not prematurely transferred control of KOLI(FM) to
Cumulus.

19\. Cumulus also claimed that the loan and lease agreements comported
with Commission precedent. However, Cumulus also noted that Driskill had
a three-hour morning show on KOLI(FM), which aired Monday through
Friday. Although Cumulus acknowledged that its employees helped Driskill
produce his show, it argued that the show's content was under Driskill's
control. Finally, Cumulus submitted a declaration from Marks, who
identified himself at this point as Cumulus' time brokerage operations
manager for KOLI(FM). Marks averred that Driskill did not report to
Cumulus on any KOLI(FM) programming matters.

20\. Apex's reply alleged that as of June 23, 1998, High still had not
arranged for a local telephone number for KOLI(FM). Apex also pointed
out that Driskill was listed in the *1998 Broadcasting & Cable Yearbook*
as KLUR-FM's music director, and it argued that it was "absurd" to
believe that Driskill was insulated from his former employer, Cumulus,
merely because he was now employed by High. Apex also contended that the
nature of the financial arrangements, coupled with High's non-profit
status and lack of income, ensured that Cumulus would acquire the
station, either by purchase or by default.

21\. *1998 Letter Decision*. By letter dated September 14, 1998, the
Bureau denied Apex's informal objection and cautioned High and Cumulus
for improperly commencing commercial operations on KOLI(FM). The Bureau
took no further action on the issue of High's premature commercial
operation, stating that the violation was less egregious than that
admonished in a prior staff action.[^14] The Bureau also admonished High
for violating the Commission's public file rule, Section 73.3527.[^15]
At the same time, however, the 1998 Letter Decision withheld action on
the license and assignment applications pending submission of
information relating to the roles of High and Cumulus in constructing
and operating KOLI(FM). The letter requested, among other things, that
High and Cumulus provide (1) a copy of all attachments to the December
1, 1997, TBA between High and Cumulus; (2) Commission precedent
approving the type of negative covenants imposed on High in the December
1997 Loan Agreement; (3) the basis for the \$238,400 purchase price for
KOLI(FM) specified in the December 1, 1997, option agreement; (4) the
name or names of the persons who constructed and oversaw construction of
KOLI(FM); (5) a description of all actions taken by High to construct
KOLI(FM); and (6) specific information regarding James Driskill's duties
as KOLI(FM) general manager. High and Cumulus responded by letters dated
October 26, 1998; Apex submitted comments on the responses on November
6, 1998.

22\. Initially, High contended that it had completed the preliminary
site work. In this regard, High stated that Hickerson had located the
site referenced in the 1995 construction permit application and, in
1997, negotiated the lease, prepaid the rent, and worked with the survey
firm to establish the site's boundaries and the precise location of the
tower. However, both High and Cumulus acknowledged that the station's
facilities were constructed by Sellmeyer and Chancey.[^16] Further, both
agreed that Cumulus placed numerous construction-related orders and
directly paid vendors for these services and equipment. Finally, both
acknowledged that Cumulus leased the studio and office space for
stations KLUR-FM and KOLI(FM), and, in turn, sub-leased a portion of
that space to High. Nevertheless, High argued that Sellmeyer knew that
final authority for construction of the station rested with
Hickerson,[^17] while Cumulus insisted that the station was constructed
according to specifications provided by High. High further contended
that in July 1997, Hickerson "began negotiations with Cumulus in order
to obtain financing for the construction" of the station, which led to
the execution of the MOU, a copy of which it attached.[^18] According to
High, "negotiations continued through the fall of 1997, culminating in
the execution" of the option agreement, TBA, loan agreement, and lease
agreement in December 1997.

23\. With respect to personnel, High averred that Driskill began his
KOLI(FM) general manager duties on January 30, 1998, when the station
began broadcasting. According to Driskill, he and Hickerson negotiated
Driskill's salary and duties in January 1998. Prior to working for High,
Driskill stated that he was the music director for KLUR-FM and reported
to Jay Phillips, the station's operations director. After beginning
employment at KOLI(FM), Driskill acknowledged that he "agreed to provide
\[his\] services to station KLUR on an uncompensated basis, assisting
Mr. Phillips with music selection." Driskill further averred that in
mid-April 1998, Phillips took primary responsibility for music selection
at KLUR-FM and that in July 1998 he \[Driskill\] "ceased all activities
relating to music selection and play-list development for the station."
Driskill declared that, as KOLI(FM)'s general manager, he performed his
daily on-air shift and necessary commercial production work, prepared
the daily music log, reviewed programming provided by Cumulus, prepared
payroll and other expenses for payment and updated the public file.
Driskill also stated that he supervised the other KOLI(FM) employee, who
answered the telephone, maintained the public service record
announcements and paid some bills. According to Cumulus, Driskill
officially resigned from its employment, effective February 15, 1998.
Finally, Cumulus reported that Chancey, then a Cumulus employee,
provided engineering services for High.

24\. High's October 26, 1998, response contains an additional affidavit
from Marks. In this affidavit, Marks identified himself as the general
manager of Cumulus stations KLUR-FM, KQXC, and KYYI. Marks acknowledged
that he was responsible for programming KOLI(FM) under the TBA.
According to Marks, Cumulus initially programmed the station without
commercials. Upon the filing of the license application, Cumulus began
commercial programming.

25\. With respect to finances, High submitted copies of all attachments
to the TBA. These submissions require Cumulus to reimburse High for
salaries, rental payments, utility charges, and insurance premiums.
However, no payment amount for airtime was specified in the TBA
attachments. In response to the Bureau's inquiry about certain negative
covenants in the loan agreement,[^19] High observed that the covenants
did not flatly prohibit High from taking the specified actions but
merely required Cumulus' consent. In any event, High argued, the
covenants in the loan agreement were for the express purpose of
protecting Cumulus' investment and did not confer control of KOLI(FM)
upon Cumulus. As for the setting of the \$238,400 purchase price for the
station, the applicants contended that it was established through
arms-length negotiations as facilitated by a broker. The purchase price
did not include station equipment, and Cumulus acknowledged that the
equipment was purchased "with the contemplation that the Station, and
all related assets, would eventually be purchased by Cumulus from High."
High further observed that Cumulus had paid approximately \$6 million
for its other three Wichita Falls area stations.

26\. In its comments filed November 6, 1998, Apex argued that the
applicants' submissions compelled the conclusion that a premature
transfer of control had occurred. Regarding construction, Apex contended
that High had not undertaken any meaningful activity to construct or
supervise construction of KOLI(FM). Apex further charged that, contrary
to the claim made by High that Driskill had ceased performing any
services for Cumulus in July 1998, Driskill continued to provide
services to KLUR-FM into October 1998. Regarding Driskill's specific
duties, Apex argued that the duties were devoid of substance and were
more likely performed for Cumulus' benefit. Thus, according to Apex,
Driskill cannot be viewed as a High management-level employee.[^20]
Further, considering that funds for Driskill's salary were provided by
Cumulus, Apex argued that Driskill's role must be deemed contrary to the
cross interest policy articulated by the Bureau in *Michael R.
Birdsill*.[^21] Apex also contended that, contrary to previous
representations, High has no financial responsibility for KOLI(FM),
because Cumulus paid all expenses. Finally, Apex argued that High's
extension and license applications lacked candor inasmuch as they made
no mention of Cumulus.

27\. *April 30, 1999, Staff Inquiry Letter*. By letter dated April 30,
1999, the staff sought further information from High and Cumulus to
assess more fully the allegations related to control of Station
KOLI(FM), High's compliance with document filing rules and the main
studio rule, and the *bona fides* of High's extension and license
applications.[^22] After receiving two extensions of time, High and
Cumulus responded by letters dated July 16, 1999.[^23]

28\. In response to queries about its finances, High acknowledged that
it could not demonstrate that it had any liquid assets for construction
of KOLI(FM) other than what it received from Cumulus. Indeed, the only
pre-Cumulus payment High could verify was for a 1995 engineering charge
for preparing High's construction permit application. Moreover, once
Cumulus became involved, High could not point to any expense related to
KOLI(FM) that Cumulus had not paid directly or indirectly. As for its
failure to file the letter of intent with the Commission, High contended
that the letter of intent was nothing more than an expression of intent
to negotiate and only set forth a procedure for negotiation. As for the
MOU, High argued that it merely provided that Cumulus would assist High
with station construction and that it merely required High to negotiate
in good faith a definitive option agreement but did not constitute a
fully negotiated option or purchase agreement.

29\. With respect to the extension application, High acknowledged that
Cumulus had entered into the referenced lease agreement. High explained
that Cumulus had agreed with High to make a portion of Cumulus' space
available to High. High also explained that it made no reference to
Cumulus in its extension or license applications because it thought none
was necessary. High maintained that it answered the questions posed by
the applications based on the facts and circumstances as they then
existed. High further contended that it filed its ownership report as it
stated it would in its license application and that it supplemented its
ownership report shortly thereafter.

30\. High admitted that the option, the TBA, and the loan agreement were
not filed within the time specified by the rules, but argued that they
were filed as soon as High recognized its oversight. High attributed
this tardy filing to inadvertence. High contended that it was not
required to file either the MOU or the letter of intent. Cumulus also
conceded that, technically, it should have filed the TBA within 30 days
of its execution; however, it contended that, because the TBA did not
become effective until January 30, 1998, its filing on February 12,
1998, should be viewed as timely.

31\. Regarding construction, Cumulus acknowledged that it contacted
Sellmeyer to construct KOLI(FM)'s authorized facilities. According to
Sellmeyer, he, Cumulus, and Hickerson agreed to an arrangement where
Sellmeyer would submit his bills directly to Cumulus. Sellmeyer and High
further claimed that, during construction, telephone conversations
between Sellmeyer and Hickerson occurred.

32\. With respect to Driskill, High averred that, beginning in January
1998, Driskill and Hickerson spoke about Driskill's potential employment
and that, following Driskill's hiring, they spoke about two to three
times per week until March 1998. From then until Hickerson's death on
April 23, 1998, they spoke about once a week. Subsequently, High stated
that Driskill also telephoned High's Treasurer, Zachary Hickerson.[^24]
High did not provide the dates of any of the calls. High's response also
reflects that Driskill received a \$100 per month raise from his prior
salary upon assuming his new duties, but that he continued to provide
services to KLUR-FM, without compensation from Cumulus, through August
1998. High conceded that it neither knew nor approved of Driskill's work
for Cumulus. According to Cumulus, Driskill is eligible for re-hire.

33\. As for programming, High averred that, on Sundays at 8 a.m.,
KOLI(FM) aired a 30-minute public affairs program hosted by Driskill,
and it provided a list of the topics covered between March 29, 1998 and
July 26, 1998. However, High also conceded that "on a few occasions" a
Cumulus employee "contributed to the programming" after Driskill had
determined that the subject matter was important to the Electra
community. With respect to Driskill's morning show, High and Cumulus
acknowledged that his daily air shift was simply part of the time
brokered by Cumulus.

34\. With regard to station expenses, Cumulus conceded that as of March
1998, it had not yet established with High the payment procedures
contemplated by the TBA. As a result, Cumulus paid most of the station's
expenses directly to third party vendors. However, by July 1998, it
appears that High was paying most of the expenses that it was obligated
to pay under the TBA although, even then, the telephone and electric
bills were addressed to Cumulus. In any event, pursuant to the TBA,
Cumulus reimbursed High for the station's expenses paid by High.
Finally, notwithstanding the TBA's recitation that High was to maintain
insurance for KOLI(FM), it appears that High did not do so.

35\. *August 10, 1999, Letter Decision*. By letter dated August 10,
1999, the Bureau granted the petition to deny in part and denied it in
part, finding that Apex had not raised a substantial and material
question of fact calling for further review regarding the license and
assignment applications. The Bureau also granted the license and
assignment applications "without prejudice to whatever action, if any,
the Commission deems appropriate in light of the matters raised \[in the
two inquiry letters discussed in greater detail above.\]"

**Discussion**

*A. Applications for Review*

36*.* [October 13, 1998, application for review]{.underline}. In its
October 13, 1998, application for review, Apex argues that the 1998
Letter Decision finding erred in failing to order the termination of
KOLI(FM)'s program tests which, it claims, were undertaken in "an
intentional and unexcused violation of a clear Commission rule." Section
73.1690(c), states Apex, clearly requires grant of an application on FCC
Form 302 before a broadcaster can convert from NCE to commercial
operation,[^25] and "there is absolutely no basis, either in law or in
fact, to support the ultimate finding . . . that \[High's\] commercial
operation of its noncommercial permit was the result of an honest
mistake."

37\. We disagree and affirm the Bureau's decision. Section 399B of the
Communications Act of 1934, as amended,[^26] implemented by Section
73.503 of the Commission's Rules, prohibits NCE broadcast stations from
broadcasting announcements that promote the sale of goods and services
of for-profit entities in exchange for remuneration. It is undisputed
that High, despite holding a permit for KOLI(FM) authorizing NCE FM
operations on non-reserved FM Channel 235, commenced commercial
operations on February 4, 1998, prior to grant of the license
application proposing, *inter alia*, conversion to commercial operation.
This operation violated the terms of its authorization and Section
73.503. As noted, High claims to have believed that Section 73.1690 did
not apply to KOLI(FM), as by its terms the rule applies only to
licensees, not permittees, and it therefore needed only to notify the
Commission of its commercial operation.[^27]

38\. We conclude that the Bureau properly rejected High's contention
that Section 73.1690(c)(9) requires NCE *licensees*, but not permittees,
to receive approval of a modification of license application prior to
converting to commercial operation. As noted by the Bureau, Section
73.1690(c) requires prior Commission approval -- *i.e.*, a finding that
a conversion to commercial operations would further the public interest
-- prior to effectuation of the change. Although the rule is phrased in
terms of licensees, no rational basis exists for applying the provisions
of Section 73.1690(c)(9) to licensees while not applying those
provisions to permittees especially when, as here, the permittee is
operating pursuant to program test authority.[^28] Despite this
violation, we conclude that Apex has not established a *prima facie*
case that High engaged in disqualifying conduct by commencing commercial
operations prior to grant of the modification of license application.
Permission to change from noncommercial to commercial service on a
non-reserved channel is routinely granted, and no basis exists in this
record to consider High's request anything but routine. While its
commencement of commercial operations was premature, this action appears
to be a simple mistake and does not implicate High's basic
qualifications.[^29] Accordingly, we affirm the staff's decision not to
pursue the matter further, and we will deny Apex' October 13, 1998,
application for review.

39\. [September 13, 1999, application for review]{.underline}. In its
September 13 application for review, Apex contends that the 1999 Letter
Decision "does not constitute reasoned decision making," as required by
the Administrative Procedure Act[^30] and the federal courts. Such
"impermissible brevity" prejudiced Apex, it claims, because it is unable
to analyze the staff's reasoning. It claims that the 1999 Letter
Decision "is utterly silent as to whatever facts it may have considered
and the manner in which its ultimate conclusion was reached." We agree
that the Letter Decision did not constitute reasoned decision making. To
rectify this deficiency, we have reviewed *de novo* the pleadings that
culminated in that ruling. For the reasons set forth below, we affirm
the staff's conclusion that Apex has not raised a substantial and
material question of fact regarding the license and assignment
applications.[^31] We will, however, admonish High and Cumulus for
unauthorized transfer of control and further admonish High for its
failure to file required contracts, as discussed *infra*.

*B. Unauthorized Transfer of Control*

40\. Section 310(d) of the Communications Act states, in pertinent part:

> No construction permit or station license, or any rights thereunder,
> shall be transferred, assigned, or disposed of in any manner,
> voluntarily or involuntarily, directly or indirectly, or by transfer
> of control of any corporation holding such permit or license, to any
> person except upon application to the Commission and upon finding by
> the Commission that the public interest, convenience, and necessity
> will be served thereby.[^32]

There is no fixed formula for evaluating whether a party is in *de
facto*, or actual, control of a broadcast station.[^33] In making such a
determination, we traditionally look to whether a new entity has
obtained the right to determine the basic operating policies of the
station.[^34] Specifically, we seek to ascertain who determines the
station's policies with respect to programming, personnel and
finances.[^35] A licensee may delegate certain functions on a day-to-day
basis to an agent or employee,[^36] but such delegation cannot be
wholesale. That is, those persons assigned a task must be guided by
policies set by the permittee or licensee.[^37] Moreover, the standards
by which we measure control are equally applicable in situations
involving time brokerage agreements.[^38] Finally, when examining a
situation where relevant agreements were entered into prior to or during
construction, we also look to see who was in control of station
construction.[^39]

41\. We find that Cumulus, not High, was the entity in control of
station construction. Cumulus, in accordance with the July 28, 1997,
letter and MOU, acquired equipment and constructed the station. Cumulus
contacted and paid Sellmeyer, the engineer who oversaw construction, and
supplied and paid the technician who had on-site responsibility for
station construction. Cumulus, after receiving proposals from Sellmeyer,
also directly contracted with equipment suppliers and paid the invoices.
In addition, Cumulus arranged for KOLI(FM) studio space in conjunction
with its acquisition of studio space for three other stations. High's
documented construction activity consisted of working with the surveyor
and finalizing the lease for the land on which the tower was built.
Finally, while we recognize that the engineer, Sellmeyer, had periodic
conversations with Hickerson and supposedly understood that High was the
client, the fact remains that Cumulus retained Sellmeyer and paid his
invoices. In sum, it appears that High's role in the construction
process was minimal while Cumulus' role was dominant.[^40]

42\. With respect to programming, the TBA gives Cumulus the right to
program the station although High can preempt or refuse to broadcast any
program it deems contrary to the public interest. In addition, the TBA
gives High the right to schedule and present public interest programming
at any time it deems best. On their face, these provisions are similar
to those previously approved by the Commission. The TBA of the type
employed in this case and the parties' programming decisions under this
agreement do not constitute an unauthorized transfer of control.[^41]

43\. As far as personnel are concerned, Apex has failed to rebut High's
claim that it hired Driskill in January, 1998, to serve as station
general manager. In that capacity, High proffers that Driskill (1)
performed one daily on-air broadcast shift;[^42] (2) performed necessary
commercial production work; (3) prepared the daily music log; (4)
reviewed the programming provided by Cumulus to ensure that it comports
with Commission requirements and meets the needs of the residents of
Electra, Texas; (5) supervised High's one other KOLI(FM) station
employee;[^43] (6) prepared payroll and other expenses for payment; (7)
updated and maintained the KOLI(FM) public inspection file; and (8)
performed "any other necessary day-to-day operational activities."[^44]
High also claims that Driskill produced a weekly 30-minute public
affairs show on Sunday mornings,[^45] and Mr. Driskill states that he
also was responsible for ensuring that KOLI(FM) complies with Commission
technical standards and for requesting engineering services for the
station as necessary.[^46] However, it also is the case that Driskill
regularly performed duties for Cumulus well after he resigned from
Cumulus' employ and became KOLI(FM)'s general manager in late January
1998.[^47] Moreover, High has failed to establish that Driskill
exercised any substantive managerial responsibilities at KOLI(FM). This
lack of control is buttressed by Cumulus' substantial financial control
over station operations.

44\. With respect to finances, for the first several months after
KOLI(FM) went on the air, Cumulus paid directly most, or perhaps all, of
the station's expenses. Indeed, there is no evidence that High paid
*any* station expenses until the summer of 1998. Moreover, station
telephone and electric bills were addressed to Cumulus after that time,
and there is no indication that High maintained insurance protection, as
it was required to under the TBA. Although High maintained a bank
account at all times during its tenure as permittee of KOLI(FM), we
conclude that High permitted Cumulus to assume key managerial and
financial control over KOLI(FM) operations from the time of the letter
of intent in July 1997 and did not regain control subsequently.[^48]

C.  *Material Omissions*

45\. High\'s assertions in the 1997 extension application concerning
equipment orders and station construction were truthful. At issue is
whether High\'s failure to disclose its contractual reliance on Cumulus
to complete station construction constitutes a \"willful material
omission\" in violation of Section 73.1015. We conclude it does not.

46\. A permittee may rely on external technical, financial and legal
assistance to construct its authorized station.[^49] In fact, the
Commission has concluded that a non-permittee/option holder may be
\"closely involved in the many facets of the funding and construction\"
of a new station.[^50] Nothing in the former extension of permit
application required the disclosure of the extent to which the permittee
was relying on unrelated parties for station construction or the terms
of the various related agreements. Although one can conclude that High
was wholly dependent on Cumulus to construct KOLI, essentially the same
\"charge\" can be leveled against any permittee that is relying on
lenders, equipment suppliers, and other vendors to finance and build its
authorized station. On these facts we cannot conclude that the extension
application was materially incomplete.

D.  *Failure to file contracts*

47\. Section 73.3613 provides in pertinent part that each broadcast
permittee is required to file with the Commission within 30 days of
their execution, certain agreements which affect the ownership and/or
operation of the permittee's station. Specifically, a permittee is
required to file, *inter alia*: "(b) \[c\]ontracts, instruments or
documents relating to the present or future ownership or control of the
permittee . . . \[including\] (3) (iii) options to purchase stock and
other executory agreements; (5) loan agreements containing provisions
restricting the . . . permittee's freedom of operation; and (d) time
brokerage agreements. In addition, Sections 73.3615(a)(4)(i) and
73.3615(b) provide that permittees include with ownership reports filed
with their license applications "\[a\] list of all contracts still in
effect required to be filed with the FCC by \[Section\] 73.3613 showing
the date of execution and expiration of each contract."

48\. As noted above, High executed the MOU on August 11, 1997. That
document established the parameters of the High-Cumulus relationship.
Specifically, it provided that Cumulus would acquire and own the
equipment necessary to operate the radio station and that it would lease
the equipment to High. It provided that Cumulus would also loan High the
money needed to construct and commence operations. It further provided
that High would give Cumulus an assignable option to acquire the
station's assets, including the station authorization, and it set the
price of the option and described it in detail. The MOU also noted what
Cumulus would pay to acquire the station's assets, and it also provided
that Cumulus would assume all indebtedness under loans made by Cumulus
to High. Moreover, the MOU provided that the parties would enter into a
time brokerage agreement. Finally, the MOU called for High to file a
copy of the executed document with the Commission. Clearly, both Cumulus
and High understood that the MOU was a document that was related to the
future ownership of KOLI(FM).[^51] As such, it should have been filed no
later than 30 days after execution, that is, by September 11, 1997.
However, High did not file it until October 26, 1998. We also find that
High did not timely file the loan agreement, the option agreement or the
TBA, nor did it provide a list of those agreements with its ownership
report. Each of the foregoing documents was executed December 1, 1997.
The TBA and option agreement were filed in February 1998; the loan
agreement was filed in June 1998. All should have been filed within 30
days of their execution as High concedes.

**Conclusions/Actions**

49\. Based upon our review of the facts and circumstances in this case,
we conclude that an evidentiary hearing is not appropriate. The
Commission is usually hesitant to designate a renewal or assignment
application for evidentiary hearing on grounds of technical or legal
violations in the absence of misrepresentation or lack of candor.[^52]
While the record indicates that Cumulus prematurely assumed control of
station KOLI(FM), there is no evidence of any attempt to intentionally
mislead the Commission about these matters.[^53] Further, as noted
previously, High's President, Larry Hickerson, is deceased, thus
mitigating the potential for future lapses.[^54] For these reasons, we
conclude that the violations here do not raise questions about the
character qualifications of these parties to be licensees.[^55] Thus,
despite the improper actions of the parties, we believe that designation
of the subject applications for evidentiary hearing, or the institution
of revocation proceedings, would be inappropriate.

50\. As discussed above, however, we find that High apparently abdicated
control of KOLI(FM) without Commission consent upon the execution of the
MOU and that such abdication continued to the date the Commission
granted the assignment of the KOLI(FM) permit to Cumulus. Furthermore,
High admittedly failed to file the MOU or TBA, loan, and option
agreement within 30 days of their execution, as required by Section
73.3613 of the Commission's Rules, and failed to list them in its
ownership report as required by Section 73.3615. Additionally, as
discussed above, we find that Cumulus apparently obtained control of
KOLI(FM) without Commission consent upon the signing of the MOU and that
such abdication continued to the date the Commission granted the
assignment of the KOLI(FM) permit to Cumulus.

51\. Under Section 503(b)(1)(A) of the Communications Act, the
Commission may assess a forfeiture against a person who has \"failed to
comply substantially with the terms and conditions of any license \[or\]
permit . . . .\"[^56] Section 503(b)(6)(A) disallows the assessment of
forfeitures against a person \"hold\[ing\] a broadcast license issued
under title III of \[the Communications\] Act . . . if the violation
charged occurred (i) more than 1 year prior to the date of issuance of
the required notice or notice of apparent liability; or (ii) prior to
the date of commencement of the current term of such license, which ever
is earlier.\"[^57] Under Section 503(b)(6)(B), a forfeiture cannot be
imposed on a person not holding a broadcast station license "if the
violation charged occurred more than one year prior to the date of
issuance of the required notice."[^58] Because the specified violations
occurred more than one year ago, while High was the permittee of
KOLI(FM), we may not levy a forfeiture against High for the violations
discussed above.[^59] With respect to Cumulus, the unauthorized transfer
of control ended with the Bureau's August, 10, 1999 grant of the subject
assignment application. The simultaneous grant of the license
application also forecloses our ability to issue a forfeiture to Cumulus
for assuming control of the station KOLI(FM) construction permit without
Commission authorization, because the conduct at issue occurred more
than one year ago. Accordingly, we ADMONISH High and Cumulus for their
failure to comply with the Commission's rules.

52\. In light of the above actions, Apex' October 13, 1998 application
for review filed on behalf of Apex Broadcasting, L.L.C. IS DENIED, and
its September 13, 1999 application for review IS GRANTED TO THE EXTENT
INDICATED HEREIN and IS DENIED in all other respects.

FEDERAL COMMUNICATIONS COMMISSION

Marlene H. Dortch

Secretary

**JOINT STATEMENT OF**

**COMMISSIONERS MICHAEL J. COPPS AND JONATHAN S. ADELSTEIN**

**CONCURRING IN PART AND DISSENTING IN PART**

*Re: High I-Q Radio, Inc., Noncommercial Educational FM Station
KOLI(FM), Electra, Texas, Memorandum Opinion and Order*

This case is replete with violations of Commission rules, including the
unauthorized commencement of commercial operations for a noncommercial
permittee; an unauthorized transfer of control of the station; and
failure to file required documents with the Commission. We concur in
these findings.

Each of these violations would ordinarily be subject to a fine or
further enforcement action. Yet, the Order concludes that no further
action is warranted on some violations, and that the lengthy delay in
this case prevents the Commission from fining the parties for other
violations because the statute of limitations has expired. So
ultimately, Cumulus, the entity that prematurely assumed control of the
station, walks away with a minor warning, all necessary FCC
authorizations and a clean slate.

Because we are not convinced that this case raises no major questions
for further inquiry, we dissent in part.

**CONCURRING STATEMENT OF**

**COMMISSIONER KEVIN J. MARTIN**

*Re: High I-Q Radio, Inc., Noncommercial Educational FM Station
KOLI(FM), Electra, TX, Application for License to Cover Construction
Permit, Application for Assignment of Construction Permit to Cumulus
Licensing Corp., Memorandum Opinion and Order*

I agree with the findings made in this Order, including the unauthorized
commercial operation and the premature transfer of control. I am
concerned, however, that the Commission's delay in action has rendered
us powerless to issue a fine. We need to act in a more timely fashion so
that the statute of limitations does not eviscerate our ability to
enforce our rules.

[^1]: Apex indirectly controls through various subsidiaries four radio
    stations licensed to Wichita Falls, Texas: KNIN-FM, KTLT, KWFS(AM),
    and KWFS-FM. These stations compete with KOLI for listeners and
    advertisers.

[^2]: *See Letter to High I-Q Radio, Inc. and Cumulus Licensing
    Corporation*, reference 1800B3-MFW (MMB, Sept. 14, 1998). High I-Q
    Radio, Inc. filed an opposition on October 28, 1998, to which Apex
    filed a reply on November 9, 1999.

[^3]: Hickerson subsequently died on April 23, 1998.

[^4]: The MOU reflects that a broker hired and paid by Cumulus helped
    determine the purchase price.

[^5]: High did not do so, however, until October 1998. High stated that
    its failure to file promptly was due to an oversight on the part of
    its counsel. Moreover, High did not submit the July 1997 letter
    until July 1999. *See* *infra*.

[^6]: The record in this case does not indicate when the option price
    was paid by Cumulus to High.

[^7]: S*ee* *infra* ¶ 18.

[^8]: High did file its ownership report on February 5, 1998. However,
    it did not include the list of contracts required by Section
    73.3615(a)(4) of the Commission's Rules.

[^9]: Apex's March 3, 1998, reply raised no new matters.

[^10]: File No. BAPH-980421HW.

[^11]: Apex also contended that High was attempting to sell an unbuilt
    station for consideration far in excess of its legitimate and
    prudent expenses in violation of Section 73.3597(c)(2) of the
    Commission's Rules. However, by *Notice of Proposed Rule Making,*
    *1998 Biennial Regulatory Review*, 13 FCC Rcd 11349, 11360 (1998),
    the Commission proposed to eliminate the "no profit" rule.
    Subsequently, by *Report and Order,* *1998 Biennial Regulatory
    Review -- Streamlining of Mass Media Rules*, 13 FCC Rcd 23056, 23070
    (1998), the Commission eliminated the no profit limitation with
    respect to the sale of outstanding commercial station construction
    permits. With respect to noncommercial educational stations, the
    Commission eliminated the no profit limitation for permits granted
    prior to the release of the Report and Order. In light of this rule
    change and considering all of the circumstances, we do not believe
    it necessary to consider this allegation further.

[^12]: Opposition at 7, n. 5.

[^13]: High relies principally on *Letter to William L. Silva, Esq*., 9
    FCC Rcd 6155 (MMB 1994), *recon. denied,* July 24, 1995,
    *application for review denied sub nom*. *Choctaw Broadcasting
    Corporation*, 12 FCC Rcd 8534 (1997).

[^14]: The Bureau cited *Letter to State of Oregon Acting by and through
    the State Board of Educations f/b/o Southern Oregon State College
    and Mr. Thomas F. Erickson (KZRO(FM), Dunsmuir, California)*,
    reference 1800B3-MFW (Aud. Serv. Div., rel. June 26, 1997)
    ("*KZRO*"), *aff'd on other grounds*, *Fatima Response, Inc.*, 14
    FCC Rcd 18543 (1999), *recon. denied*, 15 FCC Rcd 10520 (2000).

[^15]: 47 C.F.R. § 73.3527.

[^16]: Cumulus also reported that, as of September 1, 1998, Chancey
    became a Cumulus employee.

[^17]: In this regard, High submits a declaration from Sellmeyer, who
    avers that "\[t\]hroughout the construction of station KOLI I
    conferred via telephone with Mr. Larry Hickerson on several
    occasions." Sellmeyer also states that he worked with Larry
    Hickerson to prepare the STL and license applications, that he knew
    the permittee was High, and that actual final authority for
    construction rested with Larry Hickerson.

[^18]: The MOU, in turn, referenced a "letter of intent," which had been
    executed two weeks earlier.

[^19]: The Bureau referenced provisions in the agreement pursuant to
    which High was not to take any of the following actions without
    Cumulus' prior written consent: (1) change its name; (2) enter into
    any written or oral employment contract unless the contract is
    terminable at will without penalty; (3) contract with any labor
    union; or (4) enter into "any contract, lease, or agreement *with
    anyone other than Cumulus*" unless the contract was terminable upon
    30 days' notice without penalty (emphasis supplied).

[^20]: Apex also pointed out that one of High's own exhibits belied its
    claims regarding Driskill inasmuch as it was a February 3, 1998,
    letter from Cumulus' counsel addressed to Marks as "General Manager"
    of stations including KOLI.

[^21]: *Michael R. Birdsill*, 7 FCC Rcd 7891 (MMB 1992).

[^22]: *Letter to High I-Q Radio, Inc. and Cumulus Licensing
    Corporation,* reference 1800C1-JWS, (Enf. Div., rel. Apr. 30, 1999).

[^23]: In addition, by letter dated August 24, 1999, Apex submitted
    further comments on the July 16, 1999, responses of High and
    Cumulus. To the extent appropriate, Apex's comments will be
    incorporated into the discussion set forth below.

[^24]: Hickerson states that:

    > in the first month after Larry Hickerson's death, Mr. Driskill
    > spoke with me two to three times per week, assisting me in getting
    > up to speed regarding station operations as well as answering
    > questions regarding the station which were relevant to the
    > settlement of Larry Hickerson's estate. Beginning in approximately
    > June 1998, my contacts with Mr. Driskill have become less
    > frequent, depending on station activity.

    July 16, 1999, High response, Letter of Zachary Hickerson, at 3.

[^25]: Section 73.1690(c)(9) states, in pertinent part, that "a
    noncommercial educational . . . FM licensee on Channels 221 to 300
    (except Class D stations) on a channel not reserved for
    noncommercial educational use, may apply to change from educational
    or commercial *via* a modification of license application, and no
    exhibits are required with the application. The change will become
    effective upon grant of the license application." High argued that
    Section 73.1690(c)(9) did not apply here, because it was only a
    permittee, not a licensee, of KOLI(FM).

[^26]: 47 U.S.C. § 399B.

[^27]: The staff previously rejected this interpretation in *KZRO*. In
    fact, however, even prior to the adoption of Section 73.1690(c)(9),
    the staff required the filing of a license application for consent
    to convert from NCE to commercial operations.

[^28]: The "plain meaning" of a statute or regulation will not be
    followed where to do so produces an absurd result in clear violation
    of the intent of the drafters. *See United States v. American
    Trucking Associations*, 310 U.S. 534 (1940).

[^29]: At most, the premature commencement of commercial operations
    would have warranted a forfeiture for violation of Section 73.503
    and operating at variance with the KOLI(FM) authorization. *See,
    e.g.*, *Family Vision Ministries*, 18 FCC Rcd 1418 (2003) ("isolated
    occurrence" of violation of Section 73.503 did not warrant any
    sanction); *Isothermal Community College*, 17 FCC Rcd 22,666 (2002)
    (license admonished for violation of Section 399B of the Act and
    Section 73.503 of the Commission's rules when it broadcast numerous
    promotional announcements for a for-profit concert event); and
    *Russellville Educational Broadcast Foundation*, 14 FCC Rcd 13508
    (\$2,500 forfeiture imposed for violation of Section 399B of the Act
    and Section 73.503 of the Commission's rules when licensee aired
    over 800 promotional announcements on behalf of for-profit entities
    over a one-year period); *Minority Television Project Inc*., 17 FCC
    Rcd 15646 (EB, rel. Aug. 9, 2002) (\$10,000 forfeiture imposed for
    numerous and egregious violations of Section 399B of the Act and
    Section 73.621(e) of the Commission\'s rules, but finding no other
    type of sanction to be necessary or justified at the time).

[^30]: 5 U.S.C. § 551 *et seq.*

[^31]: *Serafyn v. FCC,* 149 F.3d 1213 (D.C. Cir. 1998); *Astroline
    Communications Co. v. FCC*, 857 F.2d 1556, 1561-62 (D.C. Cir. 1988);
    *Gencom, Inc.,* 832 F.2d 171, 180-81 (D.C. Cir. 1987); *Citizens for
    Jazz on WRVR v. FCC*, 775 F.2d 392, 394-95 (D.C. Cir. 1985). The
    Court of Appeals for the District of Columbia Circuit has held that
    the Commission need not rigidly follow this two-step process, and
    can focus on the second step when evaluating a petition to deny.
    *See Mobile Communications Corp. of America v. FCC*, 77 F.3d 1399,
    1409-10 (D.C. Cir. 1996), *cert. denied*, 519 U.S. 823 (1996).

[^32]: 47 U.S.C. § 310 (d). *See also* 47 C.F.R § 73.3540.

[^33]: *See, e.g*., *Stereo Broadcasters, Inc*., 55 F.C.C.2d 819, 821
    (1975), *modified*, 59 F.C.C.2d 1002 (1976).

[^34]: *See* *WHDH, Inc.*, 17 F.C.C.2d 856 (1969), *aff'd sub nom*.
    *Greater Boston Television Corp. v. FCC*, 444 F.2d 841 (D.C. Cir.
    1970), *cert. denied*, 403 U.S. 923 (1971).

[^35]: *See* *Choctaw Broadcasting Corporation*, 12 FCC Rcd at 8538
    (1997).

[^36]: S*ee, e.g*., *Southwest Texas Public Broadcasting Council*, 85
    F.C.C.2d 713, 715 (1981).

[^37]: *See* *David A. Davila*, 6 FCC Rcd 2897, 2899 (1991).

[^38]: *Choctaw Broadcasting Corporation*, *supra*.

[^39]: *See* *Roy M. Speer*, 11 FCC Rcd 18393 (1996).

[^40]: *Accord*, *Roy M. Speer*, 11 FCC Rcd at 18414-17; *Salem
    Broadcasting, Inc.,* 6 FCC Rcd at 4173.

[^41]: *See* *Choctaw Broadcasting Corporation*, 12 FCC Rcd at 8539;
    *Manahawkin Communications Corporation,* 17 FCC Rcd 342 (2001).

[^42]: Cumulus sells the advertising time and provides the material to
    be aired during Mr. Driskill's program pursuant to the TBA.

[^43]: Driskill supervised Ms. Marti Driskill, who began working at the
    station on February 16, 1998, as a receptionist. Her primary duties
    are answering the telephone, maintaining the public service record
    announcements, and paying some bills. *See* High's October 26, 1998
    response to staff inquiry letter, Declaration of James Driskill, ¶
    8.

[^44]: *See* High's June 11, 1998, Opposition to Petition to Deny,
    Affidavit of James Driskill, ¶¶ 5, 6; High's October 26, 1998,
    response to staff inquiry letter, Declaration of James Driskill, ¶¶
    6-8; and High's July 16, 1999, response to staff inquiry letter,
    Letter of Zachary C. Hickerson, at 5.

[^45]: High acknowledges that Brad Austin, a Cumulus employee, has
    contributed to this program "when Mr. Driskill has determined that
    Mr. Austin's own public affairs programming on behalf of Cumulus is
    important to the Electra Community." *See* High's July 16, 1999,
    response to staff inquiry letter, Letter of Zachary C. Hickerson, at
    5.

[^46]: *See* High's October 26, 1998, response to staff inquiry letter,
    Declaration of James Driskill, ¶ 7.

[^47]: For example, Cumulus' webs sites for KLUR-FM and KOLI(FM),
    maintained by KLUR-FM program director Jay Phillips, advertised that
    Jim Nash, that is, Driskill, was the music director for Cumulus'
    station KLUR-FM as of May 11, 1998. Consistent with the information
    on those web sites, Driskill acknowledged that he continued to
    assist Phillips in the selection of music at KLUR-FM into the summer
    of 1998. Additionally, Driskill worked for Cumulus' benefit at
    KOLI(FM) in the past by serving as a Saturday show host, and he
    continues to work to Cumulus' benefit as the host of a three-hour
    Cumulus-originated program aired Monday through Friday. The
    programming for these shows was supplied by Cumulus, and Driskill
    acted as host of these programs.

[^48]: *See, e.g., Ms. Sally Hoskins, President*, 13 FCC Rcd 25317 (MMB
    1998).

[^49]: *Roy M. Speer,* 11 FCC Rcd at 18415.

[^50]: *Manahawkin Communications Corporation,* 17 FCC Rcd at 357, ¶ 24.

[^51]: Arguably, High should also have filed the July 1997 letter of
    intent within 30 days of its execution because it also constituted a
    document that related to the future ownership of KOLI. Further,
    inasmuch as the document was not filed until July 1999, we could
    impose a forfeiture for its untimely filing. However, we conclude
    that Section 503(b)(6) also prohibits the imposition of a forfeiture
    for this violation.

[^52]: *See, e.g., Edwin L. Edwards,* 16 FCC Rcd 22236, 22247-8 (2001),
    and *Duchossois Communications of Maryland, Inc.*, 10 FCC Rcd 6688,
    6694 (1995).

[^53]: *See Edwin L. Edwards,* 16 FCC Rcd at 22247-8.

[^54]: *See, e.g.,United Broadcasting Company,* 94 F.C.C.2d 960 (1982);
    *Friendly Broadcasting Company*, 90 F.C.C.2d 225 (1982).

[^55]: *See, e.g., Edwin L. Edwards, supra; Roy M. Speer, supra
    (*"serious" unauthorized transfer of control lasting for 42 months
    did not necessitate designation of applications for hearing where
    there was no substantial and material question of fact as to whether
    parties intended to deceive the Commission); *FM Broadcasters of
    Douglas County, Assignor*¸ 10 FCC Rcd 10429, 10430 (1995) (11-month
    unauthorized transfer of control unaccompanied by false responses or
    deception "did not put in issue the qualifications" of the parties;
    forfeiture was the appropriate remedy).

[^56]: *See* 47 U.S.C. § 503(b)(1)(A).

[^57]: 47 U.S.C. § 503(b)(6)(A)(i)-(ii).

[^58]: 47 U.S.C. § 503(b)(6)(B).

[^59]: *See, e.g., California State University at Sacramento
    (KKTO(FM))*, 14 FCC Rcd 10018 (MMB 1999), *citing Roy M. Speer,* 13
    FCC Rcd 19911, 19920 (1998).