I

104TH CONGRESS

1ST SESSION H. R. 177

To amend the Communications Act of 1934 to require the Federal Communications Commission to continue and improve efforts to promote diversity in media ownership, management, and programming, and for other

purposes.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 4, 1995

Mrs. COLLINS of Illinois introduced the following bill; which was referred to

the Committee on Commerce

A BILL

To amend the Communications Act of 1934 to require the

Federal Communications Commission to continue and

improve efforts to promote diversity in media ownership,

management, and programming, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE; REFERENCES.

4 (a) SHORT TITLE.—This Act may be cited as the

5 ‘‘Diversity in Media Act of 1995’’.

6 (b) REFERENCES.—References in this Act to ‘‘the

7 Act’’ are references to the Communications Act of 1934

8 (47 U.S.C. 151 et seq.).
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1 SEC. 2. FINDINGS.

2 The Congress finds that—

3 (1) the Communications Act of 1934 was en4 acted to ensure that the allocation of the various

5 broadcast media would promote the expression of di6 verse opinions and the rapid and vigorous exchange

7 of information;

8 (2) the Federal Communications Commission

9 has formulated policies to promote diversity in the

10 ownership and management of broadcast media;

11 (3) the United States Supreme Court has af12 firmed the constitutionality of the Federal Commu13 nications Commission’s policies to promote diversity;

14 and

15 (4) it is therefore necessary to codify and to ex16 tend the policies and procedures that promote diver17 sity in the ownership, management, and program18 ming of the broadcast media.

19 SEC. 3. FINDINGS AND PURPOSES REGARDING DISCRIMI20 NATION.

21 The Act is amended by inserting after section 2

22 thereof the following new section:

23 ‘‘FINDINGS AND PURPOSES REGARDING DISCRIMINATION

24 ‘‘SEC. 2A. (a) The Congress hereby finds that—

25 ‘‘(1) minority and female Americans have been

26 and continue to be unjustly deprived of full partici-
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1 pation in the common carrier, private radio, and

2 broadcasting communications services regulated

3 under this Act;

4 ‘‘(2) an efficient American telecommunications

5 industry is of grave importance to the interstate and

6 foreign commerce of the Nation;

7 ‘‘(3) minority and female Americans have not

8 fully participated as employees or owners of tele9 communications facilities and this lack of participa10 tion greatly decreases the efficiency of the American

11 telecommunications industry;

12 ‘‘(4) participation by minority and female

13 Americans as owners or employees of telecommuni14 cations facilities materially contributes to the diver15 sity of information available to the public through

16 these facilities;

17 ‘‘(5) such participation promotes the public in18 terest not only in expression of diverse opinions, but

19 in promoting the sense of self-esteem and integrity

20 that is essential to reducing racial tensions and so21 cial conflicts and motivating individuals to seek and

22 take productive places in society; and

23 ‘‘(6) reliance on indirect structural regulation of

24 diversity of ownership and control is an important

25 and reasonable method to carry out the fundamental
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1 objectives of the First Amendment in promoting free

2 and open expression of diverse opinions.

3 ‘‘(b) It is a purpose of this Act to provide for greater

4 diversity of ownership and control of telecommunications

5 in the domestic and international marketplace by requir6 ing persons subject to regulation under this Act to develop

7 and implement equal opportunity programs as part of

8 their employment practices.’’.

9 SEC. 4. DEFINITIONS.

10 Section 3 of the Act (47 U.S.C. 153) is amended by

11 adding at the end thereof the following new paragraphs:

12 ‘‘(hh) ‘Minority’ means American Indians and Alaska

13 Natives; Asians and Pacific Islanders; Blacks, not of His14 panic origin; and Hispanics.

15 ‘‘(ii) An entity is ‘owned or controlled’ by members

16 of a minority or by women if—

17 ‘‘(1) in the case of a sole proprietorship, the

18 sole proprietor is a member of a minority or is a

19 woman;

20 ‘‘(2) in the case of a partnership, a majority of

21 the equity interest held by general partners is held

22 by members of a minority or women, and the general

23 partners hold at least 20 percent of the equity inter24 est in the partnership;
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1 ‘‘(3) in the case of a corporation with only one

2 class of voting securities, a majority of the voting se3 curities are held by members of a minority or

4 women; and

5 ‘‘(4) in the case of a corporation with more

6 than one class of voting securities, members of a mi7 nority or women hold securities controlling a major8 ity of the votes and representing at least 20 percent

9 of the equity interest in the corporation.’’.

10 SEC. 5. ANNUAL REPORT ON OWNERSHIP AND CONTROL BY

11 MINORITIES AND WOMEN.

12 Section 303 of the Act (47 U.S.C. 303) is amended

13 by adding at the end thereof the following:

14 ‘‘(v) Require, by regulation, that each holder of a li15 cense or permit for any media of mass communications

16 submit to the Commission an annual report describing, in

17 such detail as that regulation may require, the proportion

18 of the ownership and control of such holder that is held

19 by minorities and women.’’.

20 SEC. 6. PREFERENCES AND ENHANCEMENTS IN COMPARA21 TIVE SELECTIONS.

22 Section 309(e) of the Act is amended—

23 (1) by inserting ‘‘(1)’’ after ‘‘(e)’’; and

24 (2) by adding at the end thereof the following

25 new paragraphs:
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1 ‘‘(2) When the Commission has so designated for a

2 comparative hearing two or more mutually exclusive appli3 cations, the Commission—

4 ‘‘(A) determines if an applicant is entitled to

5 prevail based on the extent to which selection of the

6 applicant will increase diversification of ownership;

7 ‘‘(B) determines, if an applicant is not so enti8 tled to prevail, if an applicant is entitled to prevail

9 based on the extent to which the ownership and

10 management of the applicant are functionally inte11 grated; and

12 ‘‘(C) determines, if an applicant is not so enti13 tled to prevail, the applicant that, based on the fac14 tors reviewed under subparagraphs (A) and (B), will

15 best promote the public interest, convenience, and

16 necessity.

17 ‘‘(3) In evaluating which applicants will increase di18 versification under paragraph (2)(A), the Commission

19 shall—

20 ‘‘(A) award a demerit based on the extent of

21 ownership in other media of mass communication;

22 and

23 ‘‘(B) award an enhancement credit based on the

24 extent to which the applicant is owned or controlled

25 by minorities or women.
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1 ‘‘(4) In evaluating applicants’ integration of owner2 ship and management under paragraph (2)(B), the Com3 mission shall award enhancement credits for the following

4 characteristics (listed in descending order of the mag5 nitude of the credit which may be awarded):

6 ‘‘(A) The extent to which the applicant is

7 owned or controlled by minorities or women.

8 ‘‘(B) The extent of the applicant’s past local

9 residence and participation in local civic affairs.

10 ‘‘(C) The extent to which the applicant has pre11 vious broadcast or other business experience trans12 ferable to broadcasting.’’.

13 SEC. 7. PREFERENCES AND ENHANCEMENTS IN CONNEC14 TION WITH RANDOM SELECTIONS.

15 (a) DEFINITION OF MEDIA OF MASS COMMUNICA16 TION.—Section 309(i)(3)(C)(i) of the Act is amended—

17 (1) by inserting after ‘‘direct broadcast satellite

18 service,’’ the following: ‘‘instructional television fixed

19 service, operational fixed and fixed satellite services

20 (if used for mass media purposes),’’; and

21 (2) by inserting before the period at the end

22 thereof the following: ‘‘, without regard to whether

23 such services are distributed for a fee or whether the

24 reception system is individually addressed’’.
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1 (b) DEFINITION OF SYSTEM OF RANDOM SELEC2 TION.—Section 309(i)(3)(C) is further amended by adding

3 at the end thereof the following new paragraph:

4 ‘‘(iii) The term ‘system of random selection’ includes

5 any selection system that uses chance, in whole or in part,

6 to select one applicant from a group or pool of qualified

7 applicants, without regard to whether that selection sys8 tem is used alone or in conjunction with any other mecha9 nism (such as a point system, comparative hearing, or

10 other method) as a tie-breaker.’’.

11 (c) RESTRICTIONS ON SELECTION CRITERIA USED IN

12 CONJUNCTION WITH RANDOM SELECTIONS.—Section

13 309(i)(4) of the Act is amended by adding at the end

14 thereof the following:

15 ‘‘(D) If the Commission establishes any point system,

16 comparative criteria, or other selection criteria for use in

17 conjunction with a system of random selection to select

18 among mutually exclusive applicants for licenses for media

19 of mass communication, each such point system, compara20 tive criteria, or other selection system shall provide for the

21 granting of a significant preference or enhancement to any

22 applicant that is owned or controlled by members of a mi23 nority group or by women.’’.
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1 SEC. 8. TAX CERTIFICATES AND DISTRESS SALES.

2 Title I of the Act is amended by adding at the end

3 thereof the following new section:

4 ‘‘SEC. 10. TAX CERTIFICATES AND DISTRESS SALES.

5 ‘‘(a) ISSUANCE OF CERTIFICATE.—When determin6 ing whether to approve an application for consent by the

7 Commission to an assignment of a license or construction

8 permit or to a transfer of control of a corporate licensee

9 or permittee for a broadcast, common carrier, private

10 radio, or other telecommunications facility to an assignee

11 or transferee that is owned or controlled by members of

12 a minority or by women, the Commission, after determin13 ing the qualifications of the applicant under section

14 308(b), shall issue a tax certificate under section 1071 of

15 the Internal Revenue Code of 1954 (relating to gain from

16 sale or exchange to effectuate policies of Federal Commu17 nications Commission) if the Commission finds such ac18 tion to be consistent with section 2A.

19 ‘‘(b) FINDINGS REQUIRED.—When considering a li20 cense which has been designated for a revocation hearing,

21 or a license renewal application which has been designated

22 for hearing, the Commission shall permit the licensee to

23 assign or transfer its license to an applicant that is owned

24 or controlled by members of a minority or by women, if—

25 ‘‘(1) the applicant is qualified under section

26 308(b);
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1 ‘‘(2) the maximum percentage of the fair mar2 ket value, as of the date of the filing of the applica3 tion for transfer or assignment, or as of the date of

4 designation, whichever is lower, of the facility to be

5 paid by the assignee or transferee for the facility

6 does not exceed—

7 ‘‘(A) 75 percent, if the assignment or

8 transfer is proposed after designation for hear9 ing but before the hearing begins;

10 ‘‘(B) 50 percent, if the assignment or

11 transfer is proposed after the first prehearing

12 conference but before the order of the adminis13 trative law judge involved; or

14 ‘‘(C) 25 percent, if the assignment or

15 transfer is proposed after such order but before

16 a final ruling of the Commission denying the li17 cense renewal or revoking the license; and

18 ‘‘(3) there has been no final ruling of the Com19 mission denying the license renewal or revoking the

20 license.’’.

21 SEC. 9. EQUAL EMPLOYMENT OPPORTUNITY.

22 Title I of the Act is further amended by adding at

23 the end the following new section:
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1 ‘‘SEC. 11. EQUAL EMPLOYMENT OPPORTUNITY.

2 ‘‘(a) APPLICATION OF SECTION.—This section shall

3 apply to the following:

4 ‘‘(1) Licensees or permittees of commercially

5 operated amplitude modulation, frequency modula6 tion, television, or international broadcast stations,

7 and licensees or permittees of public broadcast sta8 tions.

9 ‘‘(2) Commercially operated amplitude modula10 tion, frequency modulation, television, or inter11 national broadcast networks, and public broadcast

12 station networks.

13 ‘‘(3) Common carriers.

14 ‘‘(4) Satellite operators, licensees, and permit15 tees, whether licensed as a broadcaster, common car16 rier, or private or other service.

17 ‘‘(5) Headquarters operations of any of the en18 tities listed in paragraph (1) through paragraph (4).

19 ‘‘(b) EQUAL OPPORTUNITY REQUIRED.—Equal op20 portunity in employment shall be afforded by each entity

21 specified in subsection (a) to all qualified persons, and no

22 person shall be discriminated against in employment be23 cause of race, color, religion, national origin, age, or sex.

24 ‘‘(c) PROGRAM REQUIRED.—Any entity specified in

25 subsection (a) which has 5 or more employees shall estab26 lish, maintain, and execute a positive continuing program
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1 of specific practices designed to ensure equal opportunity

2 in every aspect of its employment policy and practice.

3 Under the terms of its programs, it shall—

4 ‘‘(1) define the responsibility of each level of

5 management to ensure a positive application and

6 vigorous enforcement of its policy of equal oppor7 tunity, and establish a procedure to review and con8 trol managerial and supervisory performance;

9 ‘‘(2) inform its employees and recognized em10 ployee organizations of the equal employment oppor11 tunity policy and program and enlist their coopera12 tion;

13 ‘‘(3) communicate its equal employment oppor14 tunity policy and program and its employment needs

15 to sources of qualified applicants without regard to

16 race, color, religion, national origin, age, or sex, and

17 solicit their recruitment assistance on a continuing

18 basis;

19 ‘‘(4) conduct a continuing program to exclude

20 every form of prejudice or discrimination based on

21 race, color, religion, national origin, age, or sex,

22 from its personnel policies and practices and work23 ing conditions; and

24 ‘‘(5) conduct a continuing review of job struc25 ture and employment practices and adopt positive
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1 recruitment, training, job design, and other meas2 ures needed to ensure genuine equality of oppor3 tunity to participate fully in all its organizational

4 units, occupations, and levels of responsibility.

5 ‘‘(d) REGULATIONS REQUIRED.—

6 ‘‘(1) Not later than 180 days after the date of

7 enactment of this section, and after notice and op8 portunity for hearing, the Commission shall pre9 scribe rules to carry out this section.

10 ‘‘(2) Such rules shall specify the terms under

11 which an entity specified in subsection (a) shall, to

12 the extent possible—

13 ‘‘(A) disseminate its equal opportunity pro14 gram to job applicants, employees, and those

15 with whom it regularly does business;

16 ‘‘(B) use minority organizations, organiza17 tions for women, media, educational institu18 tions, and other potential sources of minority

19 and female applicants, to supply referrals when20 ever jobs are available in its operation;

21 ‘‘(C) train minority and female employees,

22 interns, or both, or provide assistance to minor23 ity educational institutions and educational in24 stitutions for women so that they can provide

25 such training, except that such requirement is
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1 not mandatory for entities specified in sub2 section (a) with fewer than fifteen full-time

3 employees;

4 ‘‘(D) evaluate its employment profile and

5 job turnover against the availability of minori6 ties and women in its labor recruitment area;

7 ‘‘(E) undertake to offer promotions of mi8 norities and women to positions of greater re9 sponsibility;

10 ‘‘(F) encourage minority and female entre11 preneurs to conduct business with all parts of

12 its operation; and

13 ‘‘(G) analyze the results of its efforts to re14 cruit, hire, promote, and use the services of mi15 norities and women and explain any difficulties

16 encountered in implementing its equal employ17 ment opportunity program.

18 ‘‘(3) Such rules also shall require an entity

19 specified in subsection (a) to file an annual statis20 tical report identifying by race and sex the number

21 of employees in each of the following full-time and

22 part-time job categories: (A) Corporate Manager;

23 (B) General Manager; (C) Chief Technician; (D)

24 Comptroller; (E) General Sales Manager; (F) Pro25 duction Manager; (G) Managers; (H) Professionals;
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1 (I) Technicians; (J) Sales; (K) Office and Clerical;

2 (L) Skilled Craftspersons; (M) Semiskilled Opera3 tors; (N) Unskilled Laborers; (O) Service Workers.’’.

4 SEC. 10. REPORT TO CONGRESS.

5 Section 4(k) of the Communications Act of 1934 (47

6 U.S.C. 154(k)) is amended by redesignating paragraphs

7 (3) and (4) as paragraphs (4) and (5), respectively, and

8 by inserting after paragraph (2) the following new para9 graph:

10 ‘‘(3) such information and data as may be of

11 value in determining the extent to which minorities

12 and women have participated, and will, under the

13 rules and policies of the Commission, have opportu14 nities to participate, as employees and owners of

15 telecommunications facilities;’’.

16 SEC. 11. ADDITIONAL PROVISIONS.

17 Section 309 of the Communications Act of 1934 is

18 further amended by adding at the end thereof the follow19 ing new subsection:

20 ‘‘(k)(1) Consistent with the objective of promoting di21 versity of ownership of the media of mass communications,

22 the Commission shall include, in any criteria used to limit

23 number, eligibility, or the community (of license) of appli24 cations for new licenses for media of mass communications

25 (as that term is used in subsection (i) of the Act), provi-
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1 sions that will increase the diversity of the ownership

2 among the new licenses granted.

3 ‘‘(2) When specifying application acceptance require4 ments for AM clear-channel stations, the Commission

5 shall accept all technically qualified applications which are

6 owned or controlled by members of a minority or by

7 women.

8 ‘‘(3) As used in paragraph (2) of this subsection, the

9 term ‘AM clear-channel stations’ means new unlimited10 time stations, nighttime operation by an authorized day11 time station, or a major change in facilities resulting in

12 operation on an AM channel (A) on which a dominant sta13 tion or stations render service over a wide area and (B)

14 which is cleared of objectionable interference within its

15 primary service area and over all or a substantial portion

16 of its secondary service areas.’’.

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