Moody Bible Institute of Chicago

c/o Jeffrey D. Southmayd, Esq.

Southmayd & Millar

1220 19 Street, N.W.

Washington, D.C. 20036

Re: NEW(FM), Crown Point, IN

Facility ID No. 28188

BPED-19891019MA

> MX Group No. 89101E
>
> **Petition to Deny**
>
> **Petition for Reconsideration**

Dear Counsel:

We have before us a Petition to Deny ("Petition") filed on May 1, 2007,
by Moody Bible Institute of Chicago ("Moody") and related pleadings.
Moody contests the Commission's tentative decision to grant the
application of Hyles-Anderson College ("HAC") for a permit to construct
a new noncommercial educational ("NCE") FM station, as proposed in the
Commission's March 27, 2007, *Omnibus Order*.[^1] For the reasons set
forth below, we deny the Petition.[^2]

The *Omnibus Order* applied the Commission's NCE comparative selection
criteria[^3] to seventy-six groups of mutually exclusive NCE FM
applications. Moody and HAC comprised MX Group 89101E, a group of two
mutually exclusive applicants competing for a single permit to build a
new NCE FM station at Crown Point, Indiana. Because both applicants
proposed to serve the same community, the Commission did not perform a
fair distribution analysis[^4] and proceeded directly to a point system
analysis. The Commission tentatively selected HAC's application for
grant because HAC qualified for 5 points and Moody qualified for 4
points under the point system.[^5] The Commission observed that HAC's
governing board, which is elected by the membership of the First Baptist
Church of Hammond (the "Church"), had undergone a gradual change in
ownership such that the original parties to the application no longer
retained more than a fifty percent interest in the application as
originally filed. The Commission waived the Rules to avoid the
assignment of a new file number, an action that would have resulted in
the dismissal of the HAC application for this "major" ownership
change.[^6]

The Commission's *Omnibus Order* delegated authority to the Media Bureau
("Bureau") to consider petitions to deny the tentative selectees, and to
grant and dismiss applications in accordance with the Commission's
tentative determinations in cases where no substantial and material
question of fact is raised through the petition to deny process.[^7]
Each of Moody's arguments is related to the change in HAC's governing
board. Moody maintains that HAC's governing board change is an
impermissible major change requiring dismissal of HAC's application.[^8]
It further alleges that HAC's failure to report those changes
contemporaneously is grounds for denial of the application because HAC
either intentionally misrepresented the composition of its board to
prevent dismissal of its application or demonstrated such "clear
ineptness" and negligence as to raise a question concerning HAC's basic
qualifications.[^9] Finally, Moody alleges that HAC failed to disclose
the real party in interest to HAC's application, which Moody contends is
the First Baptist Church of Hammond. HAC responds that the Commission
appropriately waived the Rules with respect to gradual changes in HAC's
governing board; that any failure to file timely amendments reflecting
the gradual change was due to inadvertence and not to any intention to
deceive; and that the relationship between HAC and the Church does not
present any real party in interest question.

Pursuant to Section 73.3573 of the Rules, a fifty percent change in the
governing board of an NCE applicant would generally be considered a
"major change" and would not be permissible outside of a filing
window.[^10] Moody, however, ignores the fact that the Commission waived
Section 73.3573 for HAC and other similarly situated NCE applicants that
experienced gradual ownership changes where those changes were not an
outgrowth of the party's desire to gain control over the NCE station
application.[^11] The *Omnibus Order* determined that it would be
unreasonable to penalize such NCE applicants for routine and inevitable
changes over the substantial period -- in this case, over sixteen years
-- during which the Commission was unable to act on their applications
due to rulemaking proceedings to fashion new NCE comparative procedures
and judicial challenges to those procedures.[^12] Moody maintains that
the waiver was inconsistent with the *Ocean Pines* decision[^13] in
which an administrative law judge dismissed an NCE application following
a major change in governing board composition.[^14] We find, however,
that *Ocean Pines,* which involved a sudden majority change in board
membership, is inapposite.

HAC reported changes to its governing board in amendments filed in 2001
and 2005. HAC acknowledges that it did not file amendments between 1990
and 2001, which it attributes to lack of communications counsel during a
period when the Commission had essentially ceased processing NCE
applications. The cases cited by Moody for the proposition that a
failure to report changed information raises a basic qualifications
issue, are distinguishable because they all involve failures to report
potentially decisional information or reflected a possible intent to
deceive the Commission.[^15] While it is true that HAC should have
notified the Commission contemporaneously of changes in its board, its
delayed reporting of that information is neither disqualifying nor
comparatively decisional. It is clear that the facts of this case fall
within the scope of the relief the Commission has fashioned for these
long-pending applications. Moody has not made a *prima facie* case of
any intent to deceive or that changes in HAC's governing board would
reduce the number of points for which HAC would have qualified. Moody's
argument that HAC's reporting failure is potentially disqualifying based
on "ineptness" relies on license renewal cases questioning the
qualifications of licensees that had violated multiple engineering rules
during the prior license term.[^16] HAC's failure to update its board in
a pending application at a time when the Commission was not processing
such applications is not comparable.

With respect to allegations concerning real party in interest, Moody
argues that we should apply the test of whether a third party has an
ownership interest in, or is or will be in a position to actually or
potentially control the station.[^17] At the time of HAC's initial
application in 1989, however, the Rules contained no definition of
attributable interests for NCE stations because attribution was
generally immaterial to NCE stations prior to the advent of the point
system. The application that HAC completed in 1989 asked simply for all
"parties" to the application *e.g.,* officers, directors, members of the
governing board, and members with a right to vote one percent of more of
stock, membership, or ownership interests.[^18] HAC identified its six
officers. It also included a list of 98 voting members of HAC's Board of
Directors, which included the previously identified officers. HAC
identified each member as having a less than one percent voting
interest. It did not identify the Church as a party.

The Commission did not address attribution standards for NCE stations
until April 2000 when it established the current NCE comparative
procedures.[^19] In 2001, and again in 2005, HAC amended the parties to
its application, and disclosed the relationship between HAC and the
Church. The 2001 amendment stated that "\[e\]ach Member of the governing
board of Hyles-Anderson College is also a member of the Board of Deacons
of the First Baptist Church of Hammond, Indiana. The Board of Deacons is
elected by the general membership of the First Baptist Church of
Hammond, Indiana." In response to Moody's allegations that the Church
controls HAC's governing board, HAC explains that, under a
congregational form of governance, there is no controlling Church
hierarchy that selects the governing board of HAC, but rather that there
is a grassroots process by which the general membership of the Church
elects the members of various governing bodies, including that of
HAC.[^20] Assuming *arguendo* that the Church has a reportable
attributable interest in the HAC application under the policy announced
in 2000, we cannot find that such an interest would have been reportable
from the time of initial application in 1989 through the April 2000 date
of the policy announcement. Moody has adduced no evidence that could
help establish that HAC intended to hide this information from the
Commission. To the contrary, HAC forthrightly disclosed the relationship
with the Church in July 2001 after the Commission's clarification and
prior to any comparative analysis. Moreover, the Commission was aware of
the relationship between HAC and the Church when it tentatively selected
HAC's application for grant.[^21]

Accordingly, IT IS ORDERED, That the Petition for Reconsideration filed
on April 26, 2007, by Moody Bible Institute of Chicago IS DISMISSED.

IT IS FURTHER ORDERED, That the Petition to Deny filed on May 1, 2007,
by Moody Bible Institute of Chicago IS DENIED.

IT IS FURTHER ORDERED, That the application of Hyles-Anderson College
(File No. BPED-19891019MA) IS GRANTED CONDITIONED UPON its compliance
with Section 73.7005 of the Commission's Rules, 47 C.F.R. § 73.7005,
which sets forth a four-year holding period for applicants that are
awarded permits by use of a point system.

IT IS FURTHER ORDERED, That the mutually exclusive application of Moody
Bible Institute of Chicago (File No. BPED-19910409MF) IS DISMISSED.

Sincerely,

Peter H. Doyle

Chief, Audio Division

Media Bureau

cc: Hyles-Anderson College

[^1]: *See Comparative Consideration of 76 Groups of Mutually Exclusive
    Applications for Permits to Construct New or Modified Noncommercial
    Educational FM Stations,* Memorandum Opinion and Order, FCC 07-40
    (rel. Mar. 27, 2007) ("*Omnibus Order*").

[^2]: On April 26, 2007, Moody also sought reconsideration of the
    underlying *Omnibus Order* ("April Submission")*.* However, Section
    1.106(a)(1) of the Commission's Rules (the "Rules") specifically
    prohibits petitions for reconsideration of interlocutory actions.
    *See* 47 C.F.R. § 1.106(a)(1). The *Omnibus Order* was not a final
    action with regard to any of the tentatively selected applications.
    *See Bennet v. Spear*, 520 U.S. 154, 177 (1997) (for agency action
    to be final, it \"must mark the \'consummation\' of the agency\'s
    decisionmaking process-it must not be of a merely tentative or
    interlocutory nature.\") (internal quotes and cites omitted).
    Confirming the interlocutory nature of the *Omnibus Order,* the
    Commission emphasized that \"\[o\]ur selection is \'tentative\'
    because petitions to deny may be filed against the applicant
    tentatively selected pursuant to these point system
    determinations.\" *See Omnibus Order,* \_\_ FCC Rcd at \_\_\_ ( ¶
    1). The April Submission is therefore dismissed. The only argument
    unique to the April Submission is Moody's claim that it should have
    received a fair distribution preference over HAC although both
    proposed to serve the same community. The Commission's Rules (the
    "Rules") are clear that a fair distribution analysis for NCE
    applications is appropriate only when mutually exclusive applicants
    will serve different communities. *See* 47 C.F.R. § 73.7002(a). The
    April Submission, even if treated as an informal objection to the
    grant of HAC's application, fails to raise a *prima facie* case that
    the tentative selection of HAC is in error or that grant of HAC's
    application would be contrary to the public interest.

[^3]: *See* 47 C.F.R. §§ 73.7000 -- 05.

[^4]: *See* 47 U.S.C. § 307(b); 47 C.F.R. § 73.7002.

[^5]: *See Omnibus Order*, \_\_ FCC Rcd at \_\_\_ (¶ 73); 47 C.F.R. §
    73.7003(c)(1).

[^6]: *See* 47 C.F.R. § 73.3573(b)(3).

[^7]: *See Omnibus Order*, \_\_ FCC Rcd at \_\_\_ (¶¶ 202-03); 47 C.F.R.
    §§ 0.61(h), 0.283.

[^8]: Moody argues that had HAC filed a timely amendment reflecting a
    major change in ownership it would have been a "suicide amendment"
    resulting in dismissal of the application. *See* Petition at 8
    *citing* *C. Ray Helton,* Hearing Designation Order, 4 FCC Rcd 1205
    (MMB 1989); *Maricopa County Community College District,* Hearing
    Designation Order, 3 FCC Rcd 5637 (MMB 1988); *St. Croix Wireless
    Co.,* Hearing Designation Order, 2 FCC Rcd 4447 (MMB 1987).

[^9]: *See* Petition to Deny at 8-9, n.13; 47 C.F.R. § 1.65(a).

[^10]: 47 C.F.R. §§ 73.3573(a)(1), (b)(2), and (b)(3).

[^11]: *See Omnibus Order*, \_\_ FCC Rcd at \_\_\_ (¶ 59).

[^12]: *Id.*

[^13]: *See Ocean Pines LPB Broadcast Corp.,* Initial Decision, 4 FCC
    Rcd 7767 (ALJ 1989) ("*Ocean Pines*").

[^14]: *Id.* at 7770.

[^15]: *See Fidelity Radio, Inc.,* Memorandum Opinion and Order, 1 FCC
    2d 1145 (Rev. Bd. 1965); *Edgefield-Saluda Radio Co.,* Memorandum
    Opinion and Order, 5 FCC 2d 148 (Rev. Bd 1966); *Cleveland
    Broadcasting, Inc.,* Decision, 7 FCC 2d 680 (Rev. Bd. 1967),
    *decision set aside and settlement approved,* 12 FCC 2d 1008 (1968).

[^16]: *See Heart of Black Hills,* Decision, 32 FCC 2d 196 (1971); *Nick
    J. Chaconas,* Decision, 28 FCC 2d 231 (1971); *Marvin C. Hanz,*
    Memorandum Opinion and Order, 22 FCC 2d 147 (Rev. Bd. 1970).

[^17]: *See KOWL, Inc.,* Memorandum Opinion and Order, 49 FCC 2d 962,
    964 (Rev. Bd. 1974).

[^18]: *See* FCC Form 340, Section II (May 1989 ed.).

[^19]: *See Reexamination of Comparative Standards for Noncommercial
    Educational Applications,* Report and Order, 15 FCC Rcd 7386,
    7418-19 (2000); 47 C.F.R. § 73.3555, note 2.

[^20]: Moody's showing that HAC's Chancellor was also Pastor of the
    Church and sent Moody a letter on Church stationary concerning
    settlement negotiations in this proceeding is inconsequential.

[^21]: *See Omnibus Order, \_\_* FCC Rcd \_\_\_ (¶53 and n.148).