Opinion ID: 446761
Heading Depth: 3
Heading Rank: 1

Heading: Exclusive Operating Certificates

Text: 39 In its rulemaking proceeding the CAB properly disposed of the argument made by petitioners and others that all certificated air carriers should be subject to section 504 because they receive federal financial assistance in the form of operating certificates giving exclusive domain over valuable air routes. 90 40 While an operating certificate may be of some value, it no longer gives airlines exclusive domain over routes, see section 1601(a)(1)(C) of the Act. It therefore presents a situation similar to Gottfried v. Federal Communications Commission, 655 F.2d 297 (D.C.Cir.1981), wher it was held that broadcast licenses do not count as financial assistance within the meaning of section 504. 91 41 As appropriate as the Board's reliance upon our holding in Gottfried was, however, that case merits a brief discussion here, not only because it represents an important earlier construction of the statute, but also because its holding must be understood in its appropriate--and somewhat limited--context. 42 In Gottfried this court remanded to the FCC a challenge to the license renewal of a public television station on the ground that the Commission had failed to inquire specifically into the station's efforts to meet the programming needs of the hearing impaired. 92 Its obligation to do so, the court noted, was founded upon section 504 of the Rehabilitation Act, to which the public station was bound by virtue of its receipt of federal financial assistance. 93 The court expressly held, however, that Congress did not intend broadcast licenses to count as 'financial assistance' within the meaning of section 504. 94 Accordingly, it declined to remand a parallel challenge to the license renewal of seven commercial stations to which, it concluded, section 504 did not apply. 95 43 In so doing, this court in Gottfried reviewed the legislative heritage of section 504 and of the Civil Rights Act of 1964 upon which it was modeled and discovered no reference to the FCC or to any other government program involving issuance of federal licenses. 96 Moreover, we noted that in its original regulations issued for the guidance of all federal agencies, HEW never explicitly classified broadcast licenses as financial assistance, 97 even though not only federal funds but services of Federal personnel and real and personal property or any interest in or use of such personal property and other less obviously financial assistance was so included. 98 Finally, we observed that the Justice Department, which had recently been designated by Executive Order as the agency responsible for coordinating federal efforts to implement section 504, had specifically held that  '[t]he term Federal financial assistance ... does not include licenses, for example, since licenses are not Federal assistance grants, contracts, loans, or cooperative agreements.'  99 44 In relying upon Gottfried to justify its rejection of the argument that operating certificates granted to carriers constitute federal financial assistance within the meaning of section 504, therefore, the Board was correct. 100 The license-specific nature of Gottfried's holding and rationale, however, limits its applicability when considering other types of federal financial assistance. 101