FCC Report 10/6: Commission Begins Actions On Charlottesville Area LPFM Co-Op

FCC Actions

The FCC has begun to rule on Saga Communications’ five year battle against the licenses of five Charlottesville VA LPFMs operating as the “Virginia Radio Co-Op” as it enters into a consent decree with a $1000 penalty and an abbreviated license renewal term with Genesis Communications Inc. Oldies “97.9 The Wren” WREN-LP Charlottesville.

Saga originally challenged the licenses of WREN-LP as well as “Rock Hits 92.3” WXRK-LP Charlottesville, Hip Hop “101.3 Jamz” WVAI-LP Charlottesville, and the since surrendered licenses of 94.7 WPVC-LP Charlottesville and 96.5 WKMZ-LP Ruckersville. Saga challenged the license renewals of the stations claiming that they were housed in the same facility operating as a cluster as a party to a prohibited operating agreement or management agreement, not conforming to the educational purpose outlined in its original application, selling sponsorships on the stations as a package, running commercial advertising, making false certifications in its permit application abusing FCC processes and lacking candor.

The commission finds that many of Saga failed to raise a substantial and material question of fact in regard to many of its arguments. In regards to operating as a co-op with the other LPFMs, the FCC states, “we acknowledge that the Coop operating agreement is highly unusual and that petitioner has identified issues that we will bear in mind should we be called upon to examine a similar agreement in the future. However, the Coop operating agreement itself does not contain any provisions that allow the Coop to control the programming, personnel, or finances of any Station operated by its members that are Commission licensees. The agreement specifically states: ‘Nothing in this Operating Agreement shall supersede or violate any FCC, IRS, or federal, state, or local statute, rule or regulation pertaining to the separate and distinct business and operational integrity of its members.’ Licensee also has confirmed that ‘the Coop’s role is limited to shared real property, facilities and other limited related expenses,” and ‘each member remains independent from a programming and management perspective.” Nothing in the record suggested that the Co-op had control over WREN-LP’s programming, personnel or finances with it formed to share a transmitter site, antenna, studio and office facilities. The FCC agrees with Saga that the arrangement is unconventional and warrants greater scrutiny to ensure that it does not result in violations of the restrictions on LPFM ownership, but “after reviewing the record, we conclude that the Coop operating agreement is akin to a shared services agreement”. It also adds, “to the extent that petitioner alleges that licensee and other Coop members collaborated and consulted with each other about their LPFM applications, we note that the Commission believes that ‘allowing and encouraging applicants to collaborate’ can help ensure increased service to the public.

Moving to the Co-op’s arrangement with Experience Media and Experience Media Sales LLC to handle revenue generation, the commission says that Saga failed to raise a substantial and material question of fact regarding whether the Co-Op any other individual or entity holds an attributable interest in an of its other members or that Experience Media and Experience Media Sales LLCdid so. The comment there is valid concerns regarding the relationship between the Co-op and the other parties but no proof. The arrangement specified that Experience Media was “acting as an independent contractor and not as an employee” and explicitly stated that it did “not create a partnership or joint venture” between the parties and is “exclusively a contract for service.” The marketing materials specified different rates for underwriting announcements at each station, and did not indicate that the purchase of underwriting announcements on one station was tied to the purchase of announcements on any other station or that a discount was being offered for the purchase of underwriting announcements on more than one of the stations. As the licensee had the right to accept or reject any underwriting referrals it maintained control, while also rejecting the argument that the arrangement was problematic because the owner of Experience Media Sales was an on-air host at the station as being an employee at a station does not give someone an attributable interest in the station.

The FCC also finds that Saga failed to prove that WREN-LP made false certifications in its applications, but it does find the station in violation of the Underwriting Laws as the station admitted fault in airing commercials that went beyond what is allowed for non-commercial licenses. It also was in violation of section 73.855(a) as Jonathan Hall held attributable interests in WREN-LP and WKMZ-LP, which operated as a complete simulcast until surrendering its license in October 2019 following Saga’s original complaint. Hall was General Manager, Program Director and engineer of WREN-LP and was an officer of WKMZ-LP, while his wife Sharon was a Director, but because the license was cancelled no further enforcement action was taken in regards to that violation.

Actions against WXRK-LP and WVAI-LP remain forthcoming.

The FCC has proposed a $16,000 fine against KCCS LLC for unauthorized transfer of control of 1220 KSLM/104.3 K282BY Salem OR from Cindy Wyant Smith to her daughter Jacqueline Smith.

The commission notes that Wyant Smith agreed to sell what was then KCCS to Jaqueline Smith in May 2014 with the $250,000 purchase to be paid via sweat equity in bookkeeping and administrative services to be provided at a rate of $4630 per month through February 2021. Upon the completion of that, the station’s transfer was filed Oregon Secretary of State noting that Jaqueline Smith was sole owner of the station. It was later amended to “correct previous mistakes and allow Smith to obtain the benefit of the bargain” saying the license transfer would be filed with the FCC within ten days, but that did not occur until February 2022.

During FCC review, Cindy Wyant Smith filed a declaration under penalty of perjury stating, “I am the Owner of KCCS, LLC. I am also the only LLC Member with voting and equity interests in KCCS, LLC. Jacqueline Smith
is the General Manager of KCCS, LLC. She is also a non-voting, non-equity LLC Member.” She also said that following consummation of the transaction she would maintain supervision and ultimate control of the licenses. The commission’s review then found that starting in June 2022 Smith and her three sisters were the co-owners of the station with a news article timed to their format change from Christian to Conservative Talk noting that Jaqueline Smith was General Manager, with sisters Katie Wilson as traffic director, Cynthia Ramirez as director of sales, and Amanada Smith an on-air host.

The FCC says that they found “apparently two unauthorized transfers of control” of the station. The first coming in February 2021 when Smith is listed as the only member of the LCC as she fully performed the equity services required even though her mother then amended to say she was the only voting and equity member. The second occurred when Smith and her sisters began “holding themselves out to the public as co-owners of the station.” The FCC says, “regardless of what interest an entity or individual holds in a licensee, it may nonetheless be found to have exerted actual control of a station” with the sisters not voluntarily disclosing the unauthorized transfers of control or in response to the Bureaus repeated requests, over a two year period, for further information concerning the apparent unauthorized transfers of control.

License Cancellations

After its failed donation to Relevant Radio led to Blarney Stone Broadcasting to take 1230 WMQU Grayling MI silent in February, the company has surrendered the station’s license.

E&R Broadcasting has turned in the license of 1290 WOPP Opp AL.

After being tolled for a decade, Miriam Media has surrendered the Construction Permit for 98.7 KMMI Loleta/Eureka CA.

Silent Notifications

The majority of stations filing to go silent this week were due to Hurricane Helene.

iHeartMedia’s 1230 WBHP Huntsville AL (Delivery truck clipped guy-wire causing tower collapse)
iHeartMedia’s 1340 WYNF Augusta GA (Helene)
iHeartMedia’s 1440 WGIG Brunswick GA (Helene)
iHeartMedia’s 107.7 WPRW-FM Martinez GA (Helene)
iHeartMedia’s 880 WPEK Fairview NC (Helene)
Multnomah County School District #1’s 1450 KBPS Portland OR (Station equipment being replaced)
iHeartMedia’s 96.3 WKSP Aiken SC (Helene)
iHeartMedia’s 560 WVOC Columbia SC (Helene)
iHeartMedia’s 800 WDSC Dillon SC (Helene)
iHeartMedia’s 94.1 WRZE Kingstree SC (Helene)
iHeartMedia’s 104.9 WROO Mauldin SC (Helene)
Beasley Media Group’s 102.7 WGUS-FM New Ellenton SC (Tower destroyed by Helene)
iHeartMedia’s 102.9 WZTF Scranton SC (Helene)
New Life Ministries’ 1150 WNLR Churchville VA (Lack of staffing)