Backers of a would-be LPFM in St. Petersburg, Fla., have lost an appeal to the FCC.
The decision is a victory for Cox Radio, which owns WSUN(FM) in nearby Holiday.
The case delved into questions of “voting interests” and “ownership interests.” In 2001 the Caribbean Festival Association, or Carifesta, applied for an LPFM, listing six officers and directors including two with American citizenship and four of Jamaican citizenship.
Cox asked the FCC to deny the application, arguing that the law prohibits a radio license when more than a fifth of the corporation’s capital stock is owned or voted by aliens. While Jamaican citizens are legal permanent residents of the United States, they are not qualified to own or control a radio station under the law.
Carifesta then amended its application for the new LPFM and said the board would instead be four American citizens and two Jamaicans, one of whom pledged to recuse himself from votes.
The FCC said no again in 2004; even after these changes, it decided, the board was still 33 percent Jamaican ownership. Although the sixth member might not vote, he still had an ownership interest.
Carifesta then countered that the commmission staff was “simply wrong on the law,” arguing that only 20 percent of the voting interests would be held by aliens. The FCC, it said, should ignore the presence of the board member who would recuse himself; he would have no voting interest.
The FCC staff has now rejected Carifesta’s appeal, saying the commission lacks authority to exclude “positional interests” in this way.
It also said the FCC had anticipated this issue when it instituted the LPFM service; that citizenship requirements reflect a judgment on the part of Congress to prevent undue foreign influence in broadcasting; and that the FCC has long treated the directors of non-stock, non-profit corporations as principals.
A principal’s agreement to recuse himself “will not be sufficient to demonstrate compliance … if that principal’s ownership interest exceeds the statutory limit.”
