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Public Broadcasting Self-Sufficiency Act of 1996, H.R. 2979, introduced by Rep. Jack Fields, 1996; no action taken
A bill governing the phase-out of federal appropriations to CPB, introduced in the House, Feb. 28, 1996, by Rep. Jack Fields (R-Tex.), then chairman of the House telecommunications subcommittee. Cosponsors: Porter, Oxley, Moorhead, Schaefer, Barton (Tex.), Hastert, Gillmor and Frisa. This text was originally posted on the Library of Congress web site.
To ensure the financial self-sufficiency of public broadcasting, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the `Public Broadcasting Self-Sufficiency Act of 1996'.
TITLE I--TRANSITION FROM FEDERAL FUNDING
Subtitle A--Public Broadcasting Station Opportunities
SEC. 101. DEFINITIONS.
Section 397 of the Communications Act of 1934 (47 U.S.C. 397) is amended by adding at the end the following new paragraph:
`(18) The term `transition period' means the period beginning on the date of enactment of the Public Broadcasting Self-Sufficiency Act of 1996 and ending at the close of September 30, 2000.'.
SEC. 102. EXPANDED UNDERWRITING OPPORTUNITIES.
Section 399B(b) of the Communications Act of 1934 (47 U.S.C. 399b) is amended by adding at the end thereof the following new paragraph:
`(3) Paragraph (2) shall not prohibit a public broadcast station from broadcasting or accepting remuneration for broadcasting--
`(A) well-established corporate logos or slogans, even if such logos or slogans include a call to action by the viewer or listener; or
`(B) strictly quantifiable comparative descriptions of products, services, or providers of products or services.'.
SEC. 103. PUBLIC/COMMERCIAL PARTNERSHIPS.
Section 399(b) of the Communications Act of 1934 is further amended by adding at the end the following new paragraph:
`(4) A noncommercial educational broadcast station may broadcast programs produced by, or at the expense of, or furnished by persons other than the licensee, and may receive compensation (in addition to costs incidental to production and broadcasting) for broadcasting such programs.'.
SEC. 104. CONVERSION OF STATIONS TO COMMERCIAL STATUS.
Subpart E of part IV of title III of the Communications Act of 1934 is amended by adding at the end the following new section:
`SEC. [Struck out->][ 399D. ][<-Struck
out] TELEVISION CHANNEL EXCHANGES.
`(a) PETITION- The licensees or permittees of a commercial and a public broadcast television station may jointly petition the Commission to request an exchange of channels (including public broadcast television stations on VHF channels to be exchanged for UHF channels). The Commission shall, within 90 days after receipt of such a petition, amend the television table of allotments and modify the licenses (or permits) of the petitioners to specify operation on the appropriately exchanged channels upon finding that--
`(1) the stations serve substantially the same market; and
`(2) the consideration to be paid to the public broadcast television licensee or permittee--
`(A) will be dedicated to the provision of public telecommunications services; and
`(B) fairly reflects the value of the exchange of channels and related facilities.
`(b) OTHER CONSIDERATIONS PROHIBITED- In acting on the joint petition, the Commission may not consider proposals by other parties to become licensees or permittees on the channels to be exchanged.'.
SEC. 105. REMUNERATIVE USES OF OVERLAPPING STATIONS.
Subpart E of part IV of title III of the Communications Act of 1934 is further amended by inserting after section 399D (as added by section 104 of this Act) the following new section:
`SEC. [Struck out->][ 399E. ][<-Struck
out] REMUNERATIVE USES OF OVERLAPPING STATIONS.
`(a) REMUNERATIVE USES-
`(1) AUTHORITY TO OPERATE FOR REMUNERATIVE PURPOSES- Subject to the requirements and limitations of this section, the licensee or licensees of 2 overlapping stations may, notwithstanding the allocated and licensed status of such stations as noncommercial educational television stations, operate one such station for remunerative purposes, including the transmission of commercial television programming originated by such licensee or by another party and transmission of subscription television or pay-per-view services.
`(2) CONDITIONS FOR REMUNERATIVE USE- The licensee or licensees of overlapping stations intending to operate one of such stations for remunerative purposes pursuant to paragraph (1) shall file with the Commission a joint operating agreement or other instrument providing assurances that--
`(A) the remuneration from such operations (in excess of the costs of the commercial and public television operations of such station) is dedicated to the provision of local public telecommunications services on the other overlapping station to substantially the same market; and
`(B) the station operated for remunerative purposes is, but for the remunerative operations, otherwise operated consistent with the provisions of this Act and the rules and policies of the Commission applicable to such operations.
`(3) INELIGIBILITY FOR GRANTS- No noncommercial educational television station operating under an agreement or instrument filed under paragraph (2) shall be eligible to receive any grant from funds appropriated pursuant to section 396.
`(b) SALE OF OVERLAPPING STATION-
`(1) SALE PERMITTED- Upon application by the licensee of 2 or more overlapping public television stations, the Commission shall approve the assignment of one of the licenses of such licensee for a television station to another person or entity, and shall permit such person or entity to operate such station as a commercial television station, if--
`(A) the licensee assigning such license will dedicate all compensation received for such assignment to the support of the local public telecommunications services on the retained station; and
`(B) the compensation provided to the licensee for assigning such license fairly reflects the value of the license and related facilities.
`(2) INELIGIBILITY FOR GRANTS- No public television station operated by the licensee making an assignment of a license under paragraph (1) shall be eligible to receive a grant from funds appropriated pursuant to section 396.
`(c) DEFINITIONS- For purposes of this section:
`(1) OVERLAPPING STATION- Two public television stations are `overlapping stations' if the Grade A contour of one of such stations reaches more than 50 percent of the Grade A contour of the other such station in the same television market.
`(2) TELEVISION MARKET- The term `television market' has the meaning provided in section 76.55(e)(1) of the Commission's rules (47 C.F.R. 76.55(e)(1)).'.
Subtitle B--Corporation for Public Broadcasting Financial Flexibility
SEC. 121. RELAXATION AND REDUCTION OF STATUTORY MANDATES.
(a) PURPOSES- Subsection (a) of section 396 of the Communications Act of 1934 (47 U.S.C. 396(a)) is amended to read as follows:
`(a) PURPOSES- The purposes of the Corporation for Public Broadcasting shall be--
`(1) to promote the delivery of local public telecommunications services which advance education,
support culture, and foster citizenship for all Americans;
`(2) to promote efficiency and effectiveness in the provision of public broadcasting services, through technological advances and, where appropriate, through mergers, consolidations, and joint operating agreements;
`(3) to promote and support program production;
`(4) to preserve and enhance the geographic and cultural diversity of public broadcasting programs and services;
`(5) to support public broadcasting services for rural and underserved areas and audiences;
`(7) to preserve and protect their editorial integrity and independence; and
`(8) to pioneer new telecommunications technologies and to adapt those technologies for educational and public service purposes.'.
(b) AUTHORIZED ACTIVITIES- Subsection (g) of such section is amended to read as follows:
`(g) The Corporation is authorized to take such actions consistent with the District of Columbia Nonprofit Corporation Act (D.C. Code, sec. 29-1001 et seq.) as it may, in the exercise of its business judgment, determine to be necessary to carry out the purposes set forth in subsection (a) of this section. To carry out such purposes and to take such actions, the Corporation shall have the usual powers conferred on a nonprofit corporation by such Act.'.
(c) FINANCING-
(A) by striking subparagraph (B) and inserting the following:
`(B) There are authorized to be appropriated to the Fund $250,000,000 for each of the fiscal years 1998, 1999, and 2000.';
(B) by striking subparagraphs (C) and (E);
(C) by redesignating subparagraph (D) as subparagraph (C); and
(D) by inserting after such subparagraph (C) the following new subparagraph:
`(D) The Secretary of the Treasury shall make the appropriated funds under this subsection available on a fiscal year basis.'.
(d) ALLOCATION OF APPROPRIATIONS- Section 396(k) of such Act is further amended by striking paragraphs (2) through (10) and inserting the following:
`(A) not more than 5 percent of all the amounts appropriated into the Fund available for allocation for any fiscal year shall be available for administrative expenses;
`(B) 75 percent of the remainder (after allocations are made under subparagraph (A) shall be allocated in direct grants to public television stations for the provision of public television broadcasting; and
`(C) 25 percent of such remainder shall be allocated in direct grants to public radio stations for the provision of public radio broadcasting.
`(3) CONDITIONS ON ALLOCATIONS PERMITTED- The Corporation shall have the authority to establish requirements, guidelines, and limitations with respect to the use of Federal funds by public broadcasting stations.
`(4) PUBLIC ACCOUNTABILITY OF RECIPIENTS- During the transition period, funds may not be distributed pursuant to this subsection to the Public Broadcasting Service or National Public Radio (or any successor organization), or to the licensee or permittee of any public broadcast station, unless the governing body of any such organization, any committee of such governing body, or any advisory body of any such organization, holds open meetings preceded by reasonable notice to the public. All persons shall be permitted to attend any meeting of the board, or of any such committee or body, and no person shall be required, as a condition to attendance at any such meeting, to register such person's name or to provide any other information. Nothing contained in this paragraph shall be construed to prevent any such board, committee, or body from holding closed sessions to consider matters relating to individual employees, proprietary information, litigation and other matters requiring the confidential advice of counsel, commercial or financial information obtained from a person on a privileged or confidential basis, or the purchase of property or services whenever the premature exposure of such purchase would compromise the business interests of any such organization. If any such meeting is closed pursuant to the provisions of this paragraph, the organization involved shall thereafter (within a reasonable period of time) make available to the public a written statement containing an explanation of the reasons for closing the meeting.
`(5) PUBLIC ACCESS TO REPORTS- During the transition period, funds may not be distributed pursuant to this subsection to any public telecommunications entity that does not maintain for public examination copies of the annual financial and audit reports, or other information regarding finances, submitted to the Corporation.
`(A) in communities in which there is a substantial overlap in the service areas of public television stations, the total funds made available to those stations are not more than would be provided if such areas were served by a single station; and
`(B) in communities in which there is a substantial overlap in the service areas of public radio station, the total funds made available to those stations are not more than would be provided if such areas were served by a single station, unless such stations serve significantly different listening audiences, using distinct formats and providing a high proportion of locally originated programming.
`(7) RATES OF PAY- During the transition period, funds may not be distributed pursuant to this subsection to the Public Broadcasting Service or National Public Radio (or any successor organization) unless assurances are provided to the Corporation that no officer or employee of the Public Broadcasting Service or National Public Radio (or any successor organization), as the case may be, will be compensated at an annual rate of pay which exceeds the rate of basic pay in effect from time to time for level I of the Executive Schedule under section 5312 of title 5, United States Code, and unless further assurances are provided to the Corporation that no officer or employee of such an entity will be loaned money by that entity on an interest-free basis.
`(8) SATELLITE INTERCONNECTION FUND-
`(A) There is hereby established in the Treasury a fund which shall be known as the Public Broadcasting Satellite Interconnection Fund (hereinafter in this subsection referred to as the `Satellite Interconnection Fund'), to be administered by the Secretary of the Treasury.
`(B) By December 31, 1996, the Public Broadcasting Service and National Public Radio shall prepare a final report for Congress on the status of the Satellite Interconnection Fund.
`(9) POST-TRANSITION DISCRETION- The provisions of this subsection shall cease to be effective upon the expiration of the transition period. Thereafter, the Corporation may make funding and financing decisions, and place requirements on licensees, permittees and other public broadcasting entities, in the exercise of its business judgment in consultation with public television and radio licensees.'.
TITLE II--PRIVATIZATION OF THE CORPORATION FOR PUBLIC BROADCASTING
SEC. 201. CONVERSION OF CORPORATION.
(a) CONVERSION OF BOARD TO PRIVATE APPOINTMENT PROCEDURES- Section 396(c) of the Communications Act of 1934 is amended to read as follows:
`Board of Directors
`(c)(1) The Corporation for Public Broadcasting shall have a Board of Directors (hereinafter in this section referred to as the `Board'). Until the expiration of the transition period, the Board shall consist of 9 members appointed by the President, no more than 6 of whom may be members of the same political party.
`(2) Members of the Board appointed after the date of enactment of the Public Broadcasting Self-Sufficiency Act shall be selected by the President from a list of candidates nominated by the selection committee convened under paragraph (3). The President may request the selection committee to nominate additional candidates. Such candidates shall be selected by the selection committee and the President on the basis of their qualifications and expertise in one or more of the following fields:
`(A) Investment management.
`(B) Corporate finance.
`(C) Telecommunications.
`(D) Education.
`(E) Public broadcasting.
`(3) Upon the occurrence of any vacancy in the Board prior to the expiration of the transition period, a selection committee is established to nominate candidates for such vacancy. The selection committee shall be composed of the majority and minority leaders of the Senate and the Speaker and minority leader of the House of Representatives. The selection committee shall consult with representatives of public broadcast station licensee prior to nominating any candidates.
`(4) After the expiration of the transition period, members of the Board shall be appointed in accordance with the bylaws of the Corporation. The terms of all members appointed pursuant to this subsection shall expire upon the expiration of the transition period, except as otherwise provided in such bylaws as in effect on that date.
`(5) Any vacancy in the Board shall not affect its power.'.
(e) TERMINATION OF PROVISIONS- Section 396 of such Act is further amended by adding at the end the following new subsection:
`Termination of Provisions
`(n) Effective at the end of the transition period, the following provisions of this section shall cease to be effective: subsections (d), (e), (h), (i), (l), and (m).
SEC. 202. ESTABLISHMENT OF TRUST FOR PUBLIC BROADCASTING.
(a) ESTABLISHMENT- Subpart D of part IV of title III of the Communications Act of 1934 is amended by inserting after section 396 (47 U.S.C. 396) the following new section:
`SEC. 396A. TRUST FOR PUBLIC BROADCASTING.
`(a) PURPOSE- It is the purpose of this section--
`(1) to provide for the establishment of a trust fund by the Corporation to provide ongoing support for public broadcasting after the cessation of annual appropriations under section 396(k);
`(2) to prohibit expenditures from the corpus of such trust fund; and
`(3) to authorize the appropriations to the trust fund of the proceeds of certain competitive bidding procedures, to form the corpus of the trust fund.
`(b) REQUIREMENTS- The Corporation shall, in accordance with the laws of the District of Columbia, establish a trust fund for the investment and management of
funds made available under this section. The instruments governing such trust fund shall provide--
`(1) that no part of the trust fund corpus may be expended for the operations of the Corporation or otherwise in furtherance of the purposes of the Corporation;
`(2) such trust fund corpus shall be invested in such manner as the Board of the Corporation determines to be reasonable and prudent; and
`(3) the trust fund income shall be available in accordance with the bylaws of the Corporation--
`(A) to carry out the purposes of section 396;
`(B) to pay the operational and administrative expenses of the Corporation;
`(C) to pay for public broadcasting system support; and
`(D) to provide direct grants to public broadcasting stations.
`(c) ALLOCATION REQUIREMENTS-
`(1) ONE-STATION-TO-A-MARKET SUPPORT- The Corporation shall ensure that--
`(A) in communities in which there is a substantial overlap in the service areas of public television stations, the total funds made available through direct grants to those stations are not more than would be provided if such areas were served by a single station; and
`(B) in communities in which there is a substantial overlap in the service areas of public radio station, the total funds made available through direct grants to those stations are not more than would be provided if such areas were served by a single station, unless such stations serve significantly different listening audiences, using distinct formats and providing a high proportion of locally originated programming.
`(2) USE TO SUPPORT PROGRAM PRODUCTION- The Corporation may expend up to 25 percent of the income from trust for television and radio program production.
`(1) COMMISSION ACTION REQUIRED- The Commission shall allocate by means of competitive bidding under section 309(j) the initial licenses and construction permits for the use of such portions of the electromagnetic spectrum as are, on the date of the enactment of the Public Broadcasting Self-Sufficiency Act, reserved for noncommercial education television stations and as to which no application has been accepted for filing by the Commission by such date. In addition, the Commission shall allocate by such means licenses and permits for stations relinquished under paragraph (5).
`(2) BIDDING REQUIREMENTS- The competitive bidding required by paragraph (1) shall be completed not later than January 1, 1999. In conducting such competitive bidding, the Commission--
`(A) shall, notwithstanding section 309(j)(4)(A), require lump sum payment of all bids;
`(B) shall, notwithstanding section 309(j)(4)(D), not prescribe regulations granting bidding preferences that would reduce receipts from the competitive bidding required by paragraph (1) of this subsection;
`(C) shall, prior to conducting such competitive, make such adjustments to the communities of license of the stations to be allocated as necessary, consistent with the avoidance of harmful interference, to recover for the public the full value of the spectrum resource being made available; and
`(D) shall allocate to winning bidders the same rights to obtain an allocation of spectrum for the provision of advanced television services as is available to any incumbent television broadcast station licensee.
`(3) USE OF PROCEEDS; BIDDING CONTINGENT ON APPROPRIATIONS- The proceeds of any competitive bidding conducted pursuant to this subsection, not to exceed $1,000,000,000, are authorized to be appropriated to the trust fund established by the Corporation under this section. No competitive bidding may be conducted with respect to the portions of the electromagnetic spectrum described in paragraph (1) unless the proceeds of such bidding are appropriated to such trust fund.
`(4) USE OF SPECTRUM- The Commission shall award commercial television broadcast licenses to persons or entities that are successful bidders in the competitive bidding required by paragraph (1).
`(5) AUTHORITY TO COMPENSATE RELINQUISHING LICENSEES- The Commission may enter into agreements with public broadcasting entities for the purpose of making available additional stations for allocation by competitive bidding under paragraph (1). Such agreements may provide that a public broadcasting entity that agrees to relinquish its station license may obtain 50 percent of the proceeds of the competitive bidding for the spectrum previously allocated to that station. Any such agreement shall provide that any amounts provided to such entity under this paragraph shall be used to support public broadcasting or education.
`(e) COMPLIANCE VERIFICATION- Before making any funds appropriated under subsection (d)(3) available to the Corporation, the Secretary of the Treasury--
`(1) shall verify that the Corporation has established the trust fund in accordance with the requirements of this section;
`(2) shall require the Corporation to agree that, in the event of a substantial failure by the Corporation to carry out the purposes of section 396, the corpus of the trust fund shall revert to the United States;
`(3) shall verify that the Corporation has amended its bylaws to provide for the prudent administration of the trust fund by the Corporation after the expiration of the transition period; and
`(4) may require such other information or agreements as may be necessary to protect the Federal fiscal interest.
`(f) ANNUAL REPORT- The Corporation shall submit to the Congress an annual statement on the financial condition of the trust fund.'.
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