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THE COMMUNICATIONS ACT OF 1979

TUESDAY, JUNE 26, 1979

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON COMMUNICATIONS,
COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE, ,

Washington, D.C. The subcommittee met, pursuant to notice, at 9:35 a.m., in room 2322, Rayburn House Office Building, Hon. Lionel Van Deerlin, chairman, presiding.

Mr. VAN DEERLIN. Good morning. This is, needless to say, public radio morning. Sometimes, I know, public radio feels that it tends to get lost in the shadow of its more visible partner, public TV. That is why we decided to schedule an entire morning on the subject of radio only.

We will start off with a panel of very distinguished witnesses all directly involved in the operation and management of public radio stations. The panelists are Ruth Hirschman, general manager of KCRW-FM in Santa Monica, Calif., who has been previously a witness before the committee; Thomas Bartunek, program manager of WXXI-FM, Rochester, N.Y.; Tom Thomas, executive director of the National Federation of Community Broadcasters; Peter Franck, counsel for the Pacifica Foundation; and Steven Meuche, general manager of WKAR-AM and FM, East Lansing, Mich.

We have asked the panelists to be prepared to discuss a number of questions: First, are there structural and financial differences between public radio and public television that should be taken into account in our new legislation? If so, what are they? And, how well does H.R. 3333 address these differences?

Could existing limitations on the ability of the public radio stations to generate non-Federal revenue be reduced without undermining the distinctive nature of the service? In what way?

What specific changes, if any, might be suggested in H.R. 3333? If this panel is like previous panels and witnesses from whom we have heard, the number of suggested changes are sure to challenge our time limitations.

Ms. Hirschman, would you begin this morning's discussion?

(157)

STATEMENTS OF RUTH HIRSCHMAN, GENERAL MANAGER,

KCRW-FM, SANTA MONICA, CALIF.; THOMAS BARTUNEK, WXXI-FM, ROCHESTER, N.Y.; THOMAS J. THOMAS, EXECUTIVE DIRECTOR, NATIONAL FEDERATION OF COMMUNITY BROAD. CASTERS; PETER FRANCK, VICE PRESIDENT AND CHAIRPER. SON, COMMUNICATIONS POLICY COMMITTEE, PACIFICA FOUNDATION, ACCOMPANIED BY RALPH ENGELMAN, VICE PRESIDENT; AND STEVEN K. MEUCHE, GENERAL MANAGER, WKAR-AM-FM, MICHIGAN STATE UNIVERSITY

Ms. HIRSCHMAN. KCRW is a small public radio station located in a playground in Santa Monica, Calif. Last June we achieved a dubious celebrity with the passage of proposition 13 and the subsequent loss of 90 percent of our institutional funding. KCRW views H.R. 3333 from the vantage of a struggling community college station with a diversified program format and a commitment to the neighborhood issues.

Our station operates on the principles of public access, volunteer programing, and community participation. In the face of extraordinary financial adversity we have continued to provide and expand our local service.

Public radio-public television: Clear about their own priorities, stations like KCRW are convinced of the importance of, and committed to the support of, a strong national network.

By calculatedly invoking the sacrosanct principle of local station control, the Nixon administration intentionally prevented the development of a national public television news service.

Conversely, national public radio's news magazine "All Things Considered” flourishes because direct funding to the network tends to insulate the program from local pressure and system politics.

The fear of centralized control of public broadcasting was carefully cultivated by the Nixon administration to promote individual station power brokering and to destroy the opportunities for controversial, investigative national public affairs programing. Television's structure evolved out of 5 years of political manipulation. It is a flawed system that the Endowment for Program Development has the opportunity to remodel.

Existing limitations on fund-raising: Underwriting has already claimed public broadcasting's purity but I doubt that commercial clusters will lead to her

walking the streets. My own licensee will not permit advertising. The commercial station in town regards it as unfair, Government-subsidized competition. It could be right.

Radio is, first of all, sound: KCRW operates the oldest transmitter of its kind west of the Mississippi. It suffers periodic and unpredictable breakdowns. Many replacement parts must be handcrafted since they are no longer being manufactured.

Programing grants and operating budgets do not address KCRW's fundamental problem: the state of our equipment. Few of even the wealthiest stations in the system can replace major equipment without Government aid.

This bill provides the funding for programing. Without facilities money, the local stations will become merely consumers of programs produced outside the community.

KCRW has access to the country's leading writers, directors, actors, and musicians but it does not have access to the studios or the equipment to produce state-of-the-art programing.

I urge you to revoke the sunset provision for facilities grants. Instead, you must expand NTIA's mandate to help the stations meet the sweeping technological changes that are revolutionizing the communications industry.

H.R. 3333 eliminates the Federal matching grant principle: In August 1978, I testified before this committee in Los Angeles. This is how I described the present system:

Large public stations, well-staffed, owned and operated by wealthy licensees, equipped with powerful transmitters covering major population areas, broadcasting noncontroversial, culturally approved programing and serving an elite audiencethese stations can raise a greater amount of outside financial support than the rest of us. And these very stations, which are far better able to support themselves, are also getting more of the taxpayer's dollar.

On the other hand there are the small stations, licensed to beleaguered local institutions and struggling community groups, providing public access, inviting volunteer participation and committed to a diversity of programing that reflects the very diversity of the community itself. These stations provide services which may never be self-supporting but are equally as deserving of tax support. And yet it is these stations, under the present system, which receive the "smallest slice of the pie."

Noncommercial and educational broadcasting has achieved a predictable success by serving a cultivated, affluent sector. Removing the matching-grant principle as the basis for Federal funding will give public broadcasting the opportunity to serve the public.

Conclusion: The provisions for public broadcasting in H.R. 3333 are imaginative, innovative, and visionary. The bill has a western sensibility, it keeps the risks alive, and it argues for a braver, bolder vision of public broadcasting.

Mr. VAN DEERLIN. Thank you, Ms. Hirschman.
Mr. Bartunek.

STATEMENT OF THOMAS BARTUNEK Mr. BARTUNEK. Thank you.

Thank you for the opportunity to speak with you. I want to point out that I am here as a manager of a public radio station and not as a representative of my licensee. And I want to point out too that though we are here as public radio, many of us recognize the debt we owe to our public television colleagues. Especially those of us that are joint licensees realize in many cases it was their skill at fundraising that put our stations on the air in the first place. But I think we also have to recognize that, despite the fact we share the same status, sometimes the same buildings with them, there are fundamental differences in needs and costs and in technological future that render them deserving of separate consideration and us deserving of separate consideration in this legislation.

The bill is happy to draw a distinction between commercial radio and commercial television. And I think it should make the same distinction between public radio and public television.

One of the major thrusts of the bill is diversity of programing, which we all think is a laudable goal. But I think two elements of the bill work against that goal. One is the loss of the impetus to expand the system through a facilities program; the other is the funding system which provides in many ways a boondoggle for those stations which are the only stations serving their area.

A station that is only one or two in its State will be getting all or half, for example, of the money allocated for that State, while stations which serve smaller constituencies will get a smaller percentage. But in order to expand the system we need to expand the system where there are few stations. And stations will lose greater percentages of their income from this funding formula if they are one or two and one or two more are added in that area.

I agree with the committee that the Federal Government's role in public radio should be to provide a partial shield against marketplace forces and that the financial future of public broadcasting will depend in large part on its success in tapping the resources of the private sector. I appreciate the effort to provide a structure which will make access for us easier to the private sector.

My quarrel though is not with the intention but with the structure provided. I do not think that commercial clusters will serve the purpose for which they are intended. And I will be happy to offer reasons why as the morning progresses.

My contribution to the thousands of suggestions you have already received about the legislation is to suggest that contributions to public broadcasting, either as membership fees or as underwriting support, be made tax credits rather than income deductions. The logic behind that suggestion is that dollars thus generated will in a sense be substituting for direct Federal assistance, that is, substituting for taxes; and the hope behind the suggestion is that it will make support for public broadcasting more attractive, especially for listeners with lower incomes and companies which might not otherwise have considered underwriting support like specialty restaurants or record stores or small businesses.

Consequently that will increase the degree of local accountability in the system and provide public radio with the opportunity to serve the diverse audiences that it wants to serve with its diverse program.

Mr. VAN DEERLIN. Thank you, sir.
Mr. Thomas.

STATEMENT OF THOMAS J. THOMAS Mr. THOMAS. Good morning, Mr. Chairman. It is a pleasure to be here on behalf of the 50 members and 38 associates and production groups of the National Federation of Community Broadcasters. It is also good to be here on a morning devoted entirely to the specific needs of public radio.

NFCB appreciates the opportunity we have had over the past 2 years to work with this committee. Many of our views are already on the record concerning earlier incarnations that carry over to H.R. 3333. You also have a written statement that addresses in some detail our thoughts on the new proposals before us today. If that statement can be placed in the record, I will concentrate our remarks on our major concerns.

First, I would like to touch on some of the programs we like in the bill as it stands.

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