I 

116TH CONGRESS 

1ST SESSION H. R. 3957 

To direct the Federal Communications Commission to take certain actions 

to increase diversity of ownership in the broadcasting industry, and 

for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 25, 2019 

Mr. BUTTERFIELD (for himself, Ms. CLARKE of New York, Mr. CA ́RDENAS, 

Mr. RUSH, Mr. VEASEY, and Mr. HASTINGS) introduced the following 

bill; which was referred to the Committee on Energy and Commerce, and 

in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of 

such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To direct the Federal Communications Commission to take 

certain actions to increase diversity of ownership in the 

broadcasting industry, 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. 

4 This Act may be cited as the ‘‘Expanding Broadcast 

5 Ownership Opportunities Act of 2019’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 


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1 (1) One of the main missions of the Federal 

2 Communications Commission, and a compelling gov3 ernmental interest, is to ensure that there is a diver4 sity of ownership and viewpoints in the broadcasting 

5 industry. 

6 (2) The Commission should continue to collect 

7 relevant data and conduct studies on such diversity 

8 and make appropriate recommendations to Congress 

9 on how to increase the number of minority- and 

10 women-owned broadcast stations. 

11 (3) Data from 2014 shows that, of the over 

12 1,700 commercial broadcast television stations in the 

13 United States, less than 6 percent are owned by 

14 women, and less than 3 percent are minority-owned. 

15 With respect to radio stations, women owned ap16 proximately 7 percent of FM broadcast radio sta17 tions, and minorities owned less than 3 percent of 

18 such stations. 

19 (4) Women and minority ownership is 5 to 10 

20 times higher in other industries than in the broad21 casting industry. 

22 (5) During the 17 years that a minority tax 

23 certificate program was in place at the Commission 

24 (from 1978 to 1995), the Commission issued 287 


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1 certificates for radio stations and 40 certificates for 

2 television stations. 

3 (6) The Commission can also support minority4 and women-owned entrants into the broadcasting in5 dustry by implementing an incubator program in 

6 which existing licensees assist new entrants in the 

7 operation of broadcast stations. 

8 SEC. 3. FCC REPORTS TO CONGRESS. 

9 (a) BIENNIAL REPORT CONTAINING RECOMMENDA10 TIONS FOR INCREASING NUMBER OF MINORITY- AND

11 WOMEN-OWNED BROADCAST STATIONS.—Not later than 

12 180 days after the date of the enactment of this Act, and 

13 not less frequently than every 2 years thereafter, the Com14 mission shall submit to Congress a report containing rec15 ommendations for how to increase the total number of 

16 broadcast stations that are owned or controlled by mem17 bers of minority groups or women, or by both members 

18 of minority groups and women. 

19 (b) BIENNIAL REPORT ON NUMBER OF MINORITY20 AND WOMEN-OWNED BROADCAST STATIONS.—Not later 

21 than 180 days after the date of the enactment of this Act, 

22 and not less frequently than every 2 years thereafter, the 

23 Commission shall submit to Congress a report that states 

24 the total number of broadcast stations that are owned or 

25 controlled by members of minority groups or women, or 


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1 by both members of minority groups and women, based 

2 on data reported to the Commission on Form 323. 

3 SEC. 4. TAX CERTIFICATE PROGRAM FOR BROADCAST STA4 TION TRANSACTIONS FURTHERING OWNER5 SHIP BY SOCIALLY DISADVANTAGED INDIVID6 UALS. 

7 (a) REQUIREMENTS FOR ISSUANCE OF CERTIFICATE

8 BY FCC.— 

9 (1) IN GENERAL.—Part I of title III of the 

10 Communications Act of 1934 (47 U.S.C. 301 et 

11 seq.) is amended by adding at the end the following: 

12 ‘‘SEC. 344. TAX CERTIFICATE PROGRAM FOR BROADCAST 

13 STATION TRANSACTIONS FURTHERING OWN14 ERSHIP BY SOCIALLY DISADVANTAGED INDI15 VIDUALS. 

16 ‘‘(a) ISSUANCE OF CERTIFICATE BY COMMISSION.— 

17 Upon application by a person who engages in a sale of 

18 an interest in a broadcast station described in subsection 

19 (b), subject to the rules adopted by the Commission under 

20 subsection (c), the Commission shall issue to such person 

21 a certificate stating that such sale meets the requirements 

22 of this section. 

23 ‘‘(b) SALES DESCRIBED.—The sales described in this 

24 subsection are the following: 


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1 ‘‘(1) SALE RESULTING IN OR PRESERVING OWN2 ERSHIP BY SOCIALLY DISADVANTAGED INDIVID3 UALS.—A sale of an interest in a broadcast station 

4 if, immediately following the sale, the station is 

5 owned by socially disadvantaged individuals (regard6 less of whether the station was owned by socially 

7 disadvantaged individuals before the sale). 

8 ‘‘(2) SALE BY INVESTOR IN STATION OWNED BY

9 SOCIALLY DISADVANTAGED INDIVIDUALS.—In the 

10 case of a person who has contributed capital in ex11 change for an interest in a broadcast station that is 

12 owned by socially disadvantaged individuals, a sale 

13 by such person of some or all of such interest. 

14 ‘‘(c) RULES.—The Commission shall adopt rules for 

15 the issuance of a certificate under subsection (a) that pro16 vide for the following: 

17 ‘‘(1) LIMIT ON VALUE OF SALE.—A limit on the 

18 value of an interest the sale of which qualifies for 

19 the issuance of such a certificate. The limit shall be 

20 no lower than $10,000,000 and no higher than 

21 $50,000,000. 

22 ‘‘(2) MINIMUM HOLDING PERIOD.—In the case 

23 of a sale described in subsection (b)(1), a minimum 

24 period following the sale during which the broadcast 

25 station must remain owned by socially disadvantaged 


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1 individuals. The minimum period shall be no longer 

2 than 3 years. 

3 ‘‘(3) CUMULATIVE LIMIT ON NUMBER OR

4 VALUE OF SALES.—A limit on the total number of 

5 sales or the total value of sales, or both, for which 

6 a person may be issued certificates under subsection 

7 (a). 

8 ‘‘(4) PARTICIPATION IN STATION MANAGEMENT

9 BY SOCIALLY DISADVANTAGED INDIVIDUALS.—Re10 quirements for participation by socially disadvan11 taged individuals in the management of the broad12 cast station. 

13 ‘‘(d) ANNUAL REPORT TO CONGRESS.—The Commis14 sion shall submit to Congress an annual report describing 

15 the sales for which certificates have been issued under sub16 section (a) during the period covered by the report. 

17 ‘‘(e) DEFINITIONS.—In this section: 

18 ‘‘(1) OWNED BY SOCIALLY DISADVANTAGED IN19 DIVIDUALS.—The term ‘owned by socially disadvan20 taged individuals’ means, with respect to a broadcast 

21 station, that— 

22 ‘‘(A) such station is at least 51 percent 

23 owned by one or more socially disadvantaged in24 dividuals, or, in the case of any publicly owned 

25 broadcast station, at least 51 percent of the 


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1 stock of such station is owned by one or more 

2 socially disadvantaged individuals; and 

3 ‘‘(B) the management and daily business 

4 operations of such station are controlled by one 

5 or more of such individuals. 

6 ‘‘(2) SOCIALLY DISADVANTAGED INDIVIDUAL.— 

7 The term ‘socially disadvantaged individual’ means a 

8 woman or an individual who has been subjected to 

9 racial or ethnic prejudice or cultural bias because of 

10 the identity of the individual as a member of a 

11 group without regard to the individual qualities of 

12 the individual.’’. 

13 (2) DEADLINE FOR ADOPTION OF RULES.—The 

14 Commission shall adopt rules to implement section 

15 344 of the Communications Act of 1934, as added 

16 by paragraph (1), not later than 1 year after the 

17 date of the enactment of this Act. 

18 (3) REPORT TO CONGRESS ON PROGRAM EX19 PANSION.—Not later than 6 years after the date of 

20 the enactment of this Act, the Commission shall sub21 mit to Congress a report regarding whether Con22 gress should expand section 344 of the Communica23 tions Act of 1934, as added by paragraph (1), be24 yond broadcast stations to cover other entities regu25 lated by the Commission. 


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1 (4) EXAMINATION AND REPORT TO CONGRESS

2 ON NEXUS BETWEEN DIVERSITY OF OWNERSHIP

3 AND DIVERSITY OF VIEWPOINT.— 

4 (A) EXAMINATION.—Not later than 60 

5 days after the date of the enactment of this 

6 Act, the Commission shall initiate an examina7 tion of whether there is a nexus between diver8 sity of ownership or control of broadcast sta9 tions (including ownership or control by mem10 bers of minority groups or women, or by both 

11 members of minority groups and women) and 

12 diversity of the viewpoints expressed in the mat13 ter broadcast by broadcast stations. 

14 (B) REPORT TO CONGRESS.—Not later 

15 than 2 years after the date of the enactment of 

16 this Act, the Commission shall submit to Con17 gress a report on the findings of the Commis18 sion in the examination under subparagraph 

19 (A), including supporting data. 

20 (b) NONRECOGNITION OF GAIN OR LOSS FOR TAX

21 PURPOSES.— 

22 (1) IN GENERAL.—Subchapter O of chapter 1 

23 of the Internal Revenue Code of 1986 is amended by 

24 inserting after part IV the following new part: 


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1 ‘‘PART V—SALE OF INTEREST IN CERTAIN 

2 BROADCAST STATIONS 

3 ‘‘SEC. 1071. NONRECOGNITION OF GAIN OR LOSS FROM 

4 SALE OF INTEREST IN CERTAIN BROADCAST 

5 STATIONS. 

6 ‘‘(a) NONRECOGNITION OF GAIN OR LOSS.—If a sale 

7 of an interest in a broadcast station, within the meaning 

8 of section 344 of the Communications Act of 1934, is cer9 tified by the Federal Communications Commission under 

10 such section, such sale shall, if the taxpayer so elects, be 

11 treated as an involuntary conversion of such property 

12 within the meaning of section 1033. For purposes of such 

13 section as made applicable by the provisions of this sec14 tion, stock of a corporation operating a broadcast station 

15 shall be treated as property similar or related in service 

16 or use to the property so converted. The part of the gain, 

17 if any, on such sale to which section 1033 is not applied 

18 shall nevertheless not be recognized, if the taxpayer so 

19 elects, to the extent that it is applied to reduce the basis 

20 for determining gain or loss on any such sale, of a char21 acter subject to the allowance for depreciation under sec22 tion 167, remaining in the hands of the taxpayer imme23 diately after the sale, or acquired in the same taxable year. 

24 The manner and amount of such reduction shall be deter25 mined under regulations prescribed by the Secretary. Any 

26 election made by the taxpayer under this section shall be 


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1 made by a statement to that effect in his return for the 

2 taxable year in which the sale takes place, and such elec3 tion shall be binding for the taxable year and all subse4 quent taxable years. 

5 ‘‘(b) MINIMUM HOLDING PERIOD; CONTINUED MAN6 AGEMENT.—If— 

7 ‘‘(1) there is nonrecognition of gain or loss to 

8 a taxpayer under this section with respect to a sale 

9 of property (determined without regard to this para10 graph), and 

11 ‘‘(2) the taxpayer ceases to fulfill any require12 ments of the rules adopted by the Federal Commu13 nications Commission under paragraph (2) or (4) of 

14 section 344(c) of the Communications Act of 1934 

15 (as such rules are in effect on the date of such sale), 

16 there shall be no nonrecognition of gain or loss under this 

17 section to the taxpayer with respect to such sale, except 

18 that any gain or loss recognized by the taxpayer by reason 

19 of this subsection shall be taken into account as of the 

20 date on which the taxpayer so ceases to fulfill such re21 quirements. 

22 ‘‘(c) BASIS.—For basis of property acquired on a sale 

23 treated as an involuntary conversion under subsection (a), 

24 see section 1033(b).’’. 


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1 (2) CLERICAL AMENDMENT.—The table of 

2 parts for subchapter O of chapter 1 of the Internal 

3 Revenue Code of 1986 is amended by inserting after 

4 the item related to part IV the following new part: 

‘‘PART V—SALE OF INTEREST IN CERTAIN BROADCAST STATIONS

‘‘Section 1071. Nonrecognition of gain or loss from sale of interest in certain 

broadcast stations.’’. 

5 (c) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply with respect to sales of interests 

7 in broadcast stations after the date that is 1 year after 

8 the date of the enactment of this Act. 

9 (d) SUNSET.—The amendments made by this section 

10 shall not apply with respect to sales of interests in broad11 cast stations after the date that is 16 years after the date 

12 of the enactment of this Act. 

13 SEC. 5. INCUBATOR PROGRAM. 

14 Not later than 180 days after the date of the enact15 ment of this Act, the Commission shall amend its Report 

16 and Order in the matter of rules and policies to promote 

17 new entry and ownership diversity in the broadcasting 

18 services, MB Docket No. 17–289, FCC 18–114, adopted 

19 on August 2, 2018, to do the following: 

20 (1) Expand the incubator program provided for 

21 in such Report and Order to permit a licensee to 

22 provide financial support or operational support, or 


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1 both, to a qualifying incubated entity that owns or 

2 wants to own a television broadcast station. 

3 (2) Expand the eligibility criteria for an incu4 bated entity under such program to include broad5 cast stations owned by socially disadvantaged indi6 viduals. 

7 SEC. 6. DEFINITIONS. 

8 In this Act: 

9 (1) BROADCAST STATION.—The term ‘‘broad10 cast station’’ has the meaning given such term in 

11 section 3 of the Communications Act of 1934 (47 

12 U.S.C. 153). 

13 (2) COMMISSION.—The term ‘‘Commission’’ 

14 means the Federal Communications Commission. 

15 (3) OWNED BY SOCIALLY DISADVANTAGED IN16 DIVIDUALS.—The term ‘‘owned by socially disadvan17 taged individuals’’ has the meaning given such term 

18 in section 344 of the Communications Act of 1934, 

19 as added by section 4. 

Æ 


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