Public, Commercial Broadcasters in Head-to-Head Battle : Fight Over Fairness Doctrine and License Transfer Fees

Public and commercial broadcasters have squared off in Washington over legislation that would resurrect the so-called Fairness Doctrine and also raise more than $300 million a year for public TV and radio stations.

And though commercial broadcasters appeared late Friday to have won the first round of the intense lobbying battle, the war seems to be far from over.

The debate focuses on two pieces of legislation that bring to a boil a long-simmering feud between public and commercial broadcasters over money and audience:

One, passed by the House a week ago on a 259-157 vote, would make the Fairness Doctrine a federal law.

The second, defeated 66-28 by the Senate late Thursday, would have imposed a license transfer fee on the sale of radio and TV stations. The fees, ranging from 2% to 4%, depending on how long the license had been held by the seller, would have collected in a trust fund that perennially cash-strapped public broadcasters could have begun tapping for programming and operating expenses in 1990.

Neither side appears ready to give in.

“We keep on because right and truth are on our side,” said Senate Commerce Committee Chairman Ernest F. Hollings (D-S.C.), one of the authors of the Fairness Doctrine/funding measures backed by public broadcasters.

“We’ve always been great supporters of the public broadcasting system, but we don’t think it’s fair that we should be the ones who have to support our competition,” said Susan Kraus, spokeswoman for the National Assn. of Broadcasters, which represents more than 6,000 commercial radio and television stations opposing the Fairness Doctrine and license transfer fee.

Douglas Bennet, president of National Public Radio, said, “I think the issue of long-term financing is more alive now than it was before we started the fight. It’s part of an ongoing process and we hope we can work out a way of longer-term funding that commercial broadcasting can support.”

Hollings, who tried to tie the two issues together and tag them on to an all-inclusive federal budget deficit reduction bill, was less charitable in his comments about the commercial broadcasting lobby that went to work to defeat both bills a month ago.

“This crowd makes millions out of (federally licensed broadcast licenses) and doesn’t pay a dime for it,” Hollings told The Times shortly after his transfer fee bill went down to defeat in the Senate.

As for the lobbying tactics, Hollings said: “It was horrendous.”

“Our broadcaster friends . . . are the most powerful I know of,” Hollings told fellow senators Thursday night as he made a last-ditch effort to save the transfer fee bill. “If you do not really understand, I can tell you here and now they can change votes right and left. And that is quite understandable. We live and breathe by television, and that is our re-election. . . . If the local broadcaster calls, you are going to do him a favor. You are not worried about (a veto threat by) the President. You are worried about your own re-election.”

Like newspaper publishers, commercial broadcasters are among the most powerful groups lobbying on Capitol Hill, Hollings told The Times in a later interview.

“All you need are two good broadcasters from your district or your state to come by and say, ‘This is important to me,’ and that’s a vote you throw to them,” Hollings said. “They (broadcasters) change the votes right quickly.”

The Fairness Doctrine provision will go to separate House-Senate conference committees this week, but the transfer-fee scheme appears to be dead for the moment.

“We considered it the most important piece of legislation to come along in 20 years, as far as it applied to public broadcasting,” said Bruce Christensen, president of the Public Broadcasting Service, which supplies programming to the nation’s 300 public TV stations.

Commercial broadcasters, on the other hand, said the plan would unjustly force them to subsidize non-commercial TV and radio--with which they compete for audience, if not advertisers.

Walt Wurfel, vice president of the commercial broadcasters’ association, described a mobilization plan nearly two months ago that sounded like strategy to take Normandy. In addition to letter-writing, telegram and phone campaigns, association members were encouraged to fly to Washington to visit their representatives and senators and to corral them in their hometowns if they happened to be home meeting with constituents.

“We even had one of our members track down (Sen. John) Danforth (R-Mo.) at the World Series in St. Louis and bend his ear between innings,” Wurfel said.

Though NPR’s Bennet and PBS’ Christensen seemed as strident as NAB members in their low-profile attempts to lobby for Hollings’ bill, they were not successful in part because they don’t have the money and numbers of the commercial broadcasters. Hollings called the NAB’s tactics “never more greedy, never more selfish, never more stupid.”

What upset the broadcasters’ association and its members most was the license transfer fee, which Kraus said her organization viewed as a punitive tax. In recent years, radio stations have sold for as much as $40 million, television stations as much as $500 million.

The association also objected to a section of Hollings’ bill that would have added another 1% to the license transfer fee if the station owner was found by the Federal Communications Commission to have violated the Fairness Doctrine.

Abolished by the FCC on Aug. 4, the Fairness Doctrine had been federal policy for 38 years. It required broadcasters to air opposing and divergent points of views on controversial issues of public importance.

Sen. Bob Packwood (R-Ore.), a Fairness Doctrine opponent, described the proposed extra 1% penalty for Fairness Doctrine violations as “a tax on free speech.”

While President Reagan vetoed a congressional attempt to make the Fairness Doctrine law in July, the legislative forces that spearheaded that effort incorporated it into Hollings’ bill and a similar House bill aimed at reducing the federal deficit.

However, after a round of complicated political bargaining on Thursday, Hollings agreed to strip the Fairness Doctrine provision from his bill. The Fairness Doctrine remains a part of the House bill.

Reagan has repeatedly warned that he will veto any legislation containing the Fairness Doctrine or transfer fees. However, many on Capitol Hill are skeptical that the President would follow through on that threat if it means jeopardizing the deficit-reduction bill.

Treasury Secretary James A. Baker III and budget director James C. Miller III insisted in a letter to Senate leaders on Thursday that the veto threat is not a bluff.

Had the transfer-fee legislation passed, it would have raised $254 million by 1990 and $304 million by 1991, according to projections released by the Congressional Budget Office.

During the ‘80s, the federal government’s share of the total public broadcasting budget (now about $1.5 billion) has steadily decreased. From a high of as much as 23% of the annual budgets of public radio and TV stations seven years ago, the federal appropriation is now about 15%, according to Nancy Nubauer, director fo communications for the National Assn. of Public Television Stations.

Hollings said that the scramble to get public subscriptions--which can account for as much as 75% of a station’s annual budget--diverts public TV from its central mission: producing quality programming. “We’re trying to stabilize public broadcasting, because a third of their time is spent begging,” the senator said.

For the current fiscal year, federal funding for public broadcasting totals $228 million. But by 1991, the Corporation for Public Broadcasting, which oversees all federal funding for public television and radio, will ask Congress for $595 million.

Part of the large increase is laid to the need for a new satellite system to distribute programming, according to Christensen.

“Our satellite system is going to go kaput in 1991,” he said. “We own three transponders on Westar 4 (a communications satellite) and it’s going to take at least $200 million to replace them.”

Westar 4 is expected to wear out within three to five years.

“Public broadcasters saw the bill as a bird in the hand,” said the NAB’s Kraus. “But we’re saying it’s an unnecessary thing right now. There are alternatives to look at and plenty of time.”

One such alternative is an NAB-supported proposal to apply a tax of 1.5% to 2% to the sales of radios, television sets and videocassette recorders. That money would then be placed in trust for public broadcasters.