Clyburn Pushes CBS Radio to Consider Minority Owners.
FCC commissioner Mignon Clyburn is using her bully pulpit to give CBS Radio a public nudge. With the company’s IPO expected by the end of the first quarter, Clyburn is urging the company to use the opportunity to sell some of its 117 stations in 26 markets to new entrants. “I would encourage this group owner and others like it to consider offers from women and minority-owned businesses seeking to enter or expand their presence in the radio business,” Clyburn said during a speech on Wednesday in Washington. It’s unknown whether CBS would even consider the idea, however. The company didn’t respond to a request for comment.
As the only Democrat on the Commission until President Trump fills two vacancies, Clyburn also signaled she will be doing what she can to block any efforts by the new Republican majority to ease media ownership restrictions and put more stations in the hands of the big media conglomerates. “I have heard those Commission rules described as ‘outdated relics of a long-gone era’ and that the elimination of some of these rules would increase investment opportunities,” she said. “What I am still waiting to hear is how we should work together in order to move the inclusion and opportunity needle for those of us who still dream of owning and operating broadcast properties.”
Clyburn is the former owner of a weekly African-American-targeted newspaper in South Carolina and she told the National Association of Broadcasters’ Capital Assets Conference that the idea of owning a radio or television station has been “a dream” of hers for as long as she can remember. “But the hard, cold reality is this: A new entrant, with no existing license, has a supreme challenge when it comes to acquiring the capital necessary to seal a broadcast property deal,” she said. “Compound this with being a woman or person of color, and it may seem next to impossible to break into the business.” Clyburn told the conference focused on helping women and minority operators secure financing that she met with four different station owners at the NAB-RAB Radio Show in Nashville and learned firsthand just how big a challenge it can be. “A minority-owned station group estimated that launching a single new radio station would require around $10 million in financing,” Clyburn said. “So we should not be surprised at all that our local banks are not rushing to finance these deals.”
The FCC says just over 8% of commercial radio stations and about 6% of local television stations are owned by minority broadcasters. To help boost those numbers, Clyburn said she also now supports an idea, first suggested by the National Association of Broadcasters, of backing a pilot incubator program that would waive certain ownership restrictions for an incumbent broadcaster if the operator agrees to help a new entrant get a toehold in the business. “Such incubation, perhaps in the form of lending financial, programming or technical support, could result in the successful entry of a new broadcaster, increasing the diversity of voices available to the public,” she said.
Clyburn last month released a multipart proposal—what she’s calling her “Solutions 2020 Call to Action Plan”—that urges the reinstatement of the FCC’s Minority Tax Certificate Program be the first step taken. During its 17-year existence, according to Clyburn, it helped minority radio ownership rise from just 40 radio and TV stations in 1978 to 288 radio and 43 TV stations by the time Congress pulled the plug. “Despite ending in 1995, I am convinced not only does bipartisan support for this program remain, but that we should collectively push for an updated bill,” she said.
Reviving the minority tax certificate would require an act of Congress. The last time legislation was introduced was in 2007, and while it drew no opposition, there was also limited support with similar fraud concerns that had sidelined the program earlier. Rather than giving a seller a break on capital gains taxes as in the past, supporters have suggested a new program be crafted more as a tax deferral program that would impose a cap on the amount of tax that could be deferred in a transaction, and imposing a cap on the total deferred taxation for all transactions within a year.
This story was first published by Inside Radio
Your Editor Echos: Beautiful work, Commissioner
