McCAIN INTRODUCES BILL TO CHANGE FCC PROCEDURES
Legislation introduced Fri. by Senate Commerce Committee Chmn. John McCain (R-Ariz.) would make sweeping changes in the FCC’s operation, such as raising the fees for rule violations, preventing the use of bankruptcy to avoid spectrum payments and preventing nongovernmental entities from reimbursing travel costs for FCC officials. The bill also would make several changes in the media ownership review process.
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The FCC Reauthorization Act would be the first reauthorization of the agency since 1991, McCain said in a Senate floor speech. The bill, co-sponsored by ranking Democrat Hollings (S.C.), would reauthorize the FCC until 2007 and would be considered during the committee’s June 19 meeting.
Fine limits would be increased by a factor of 10, McCain said, to prevent companies from writing them off as a “cost of doing business.” The bill would increase the statute of limitations on FCC rule violations to 2 years from 1. The Commission repeatedly has asked for authority to levy larger fines on the premise that the financial penalties it can assess now aren’t heavy enough to deter rule violations. A party that’s injured by a common carrier would be eligible to recover damages at the FCC or before a U.S. Dist. Court., the bill proposes. ALTS Pres. John Windhausen said his CLEC members supported increasing the fines. “Increasing the fines could cause the Bell companies to wake up and obey the law,” he said, and fines haven’t affected RBOCs bottom lines: “The next stage is getting the FCC to impose the fines.”
The bill includes several changes relevant to broadcasters, cable and satellite. It would change the review period of media ownership to 5 years from 2 years and would allow the FCC to reregulate media ownership if it was deemed necessary. All 5 commissioners advocated a longer review period in the recent Senate Commerce Committee hearing on media ownership (CD June 5 p1). Several commissioners also advocated giving the FCC power to reregulate ownership, McCain said, and courts have found ownership review to carry with it the presumption of deregulation.
The bill would authorize more funds for FCC travel, McCain said, citing reports that in the past 8 years Commission officials had taken more than 2,500 trips paid for by the industries it regulated. Travel at the expense of a nongovt. entity would be banned, he said. “Although this is perfectly legal and it is often appropriate for FCC officials and staff should attend such conventions, conferences or meetings, it should be without the appearance of impropriety,” McCain said. The bill would impose a one-year ban on lobbying by high-level FCC staffers after they left the Commission.
The agency could assess fines against direct broadcast satellite operators in the same manner it does against broadcasters and cable operators, under the bill. In reaction to a recent U.S. Appeals Court, D.C., ruling, it would give the FCC the authority to require visual descriptions of TV programming to assist the visually impaired.
Companies couldn’t declare bankruptcy to avoid making spectrum payments, an apparent reaction to the NextWave case, and the bill would establish an office within the FCC “for the recording and perfecting of security interests related to licenses,” McCain said. The Commission would have the power to seize broadcasting equipment that was used for malicious interference to radio communications.
The bill would allocate funds to the FCC for a thorough audit of the e-rate program. McCain cited allegations of fraud in the e-rate program and said the bill would require the agency to issue a report of its findings every year from 2004 to 2007. “Serious allegations of fraud in the operation of the e-rate fund have been raised in recent months, and we should provide the Commission with adequate resources to ensure that e-rate funds are being used for the purposes intended,” McCain said. The House Commerce Investigation Subcommittee has been reviewing the e-rate program and spokesman Ken Johnson said the “eye-opening” investigation had uncovered millions of dollars of abuse in the program. Johnson said there would be an e-rate hearing in the early fall.
FCC Chmn. Powell said he supported the bill, saying it contained provisions “that I have long advocated” and that would make the Commission “a more effective agency.” Johnson said the House Commerce Committee could schedule an FCC reauthorization hearing in the near future.