POWELL, SERRANO SPAR OVER STERN, FCC DECENCY ENFORCEMENT

FCC Chmn. Powell defended himself against vague accusations that the FCC “intimidated” broadcasters to prevent them from challenging FCC fines, during a hearing on the FCC’s budget Wed. House Appropriations Commerce Justice State ranking Democrat Serrano (N.Y.) also implied that the FCC pressured Clear Channel to drop Howard Stern from its 6 stations that carried the program. Powell defended the FCC’s actions on indecency, denied any role in Clear Channel’s decision and asked Serrano for more specifics, saying Serrano was making “ethical accusations.”

Serrano was one of a handful of members who has said Clear Channel’s removal of Stern was linked to Stern’s reversal of his support for President Bush. During the hearing, Serrano said he would have “loved to have… heard the conversations between the FCC and Clear Channel” before the decision was made to drop Stern. Powell immediately fired back that there were no such conversations. Powell said he first learned of the company’s decision from the newspaper and that the decision was most likely timed to coincide with a House Telecom Subcommittee hearing on indecency. Also, Powell said the FCC has only once issued fines against Stern during his tenure as chairman. “I get criticized for not taking enough action” against Stern and other programs, Powell said. Powell said fines against Clear Channel were for radio broadcasts other than Stern’s.

Serrano voiced concerns about the “climate” that indecency enforcement was creating and said the FCC “selectively” decides what content should be subject to fines. Serrano also said broadcasters are intimidated from challenging fines, because the FCC would retaliate in other ways, such as delaying broadcast license renewals. Serrano didn’t cite specific examples, but said the FCC was “hellbent” to go after Stern: “Stern was okay until he started disagreeing with the administration.” Serrano said he hoped legislation to raise fines for indecency would “die in the Senate.”

Powell said the Communications Act, with case law, helped determine how the FCC should approach indecency. He said broadcasters should “feel free” to challenge any fines levied against them and noted that his actions are often the subject of lawsuits. Powell did acknowledge there was a level of interpretation in deciding which cases to bring, much like criminal prosecutors’ discretion in bringing criminal cases. The debate ended amicably when Serrano offered to schedule Powell for a guest appearance on Stern’s show.

House Appropriations CJS Subcommittee Chmn. Wolf (R-Va.) also asked about indecency, in the context of media ownership and the V-chip. Powell told Wolf -- a supporter of the 35% broadcast ownership cap -- that he believed more indecency was occurring as a result of less media consolidation. He said wholesome shows like I Love Lucy were the standards when TV was in the “consolidated” period of having just 3 networks. With hundreds of channels to surf, programmers are now trying hard to push the limits to retain viewers, Powell said. Powell also told Wolf that the V-chip is underused and the govt. should periodically promote the V-chip to remind parents of its usefulness.

During the hearing, Wolf and Serrano addressed the full gamut of FCC issues. Wolf asked several questions about public safety, interoperability, auction funding and FCC travel. Serrano asked about the prospects of a Triennial Review Order appeal and connection fees charged for cell phone calls to other countries, specifically Latin American countries.

Powell told Wolf that solutions to public safety interference would likely be expensive, $1 billion-$4 billion. He said the FCC was in the “late innings” of developing a solution to the 800 MHz interference problem and would probably have a solution developed within months, possibly sometime in April. Powell also told Wolf that public safety and interoperability issues might require legislation from Congress, but didn’t elaborate on legislative specifics.

Powell told Wolf that Senate action to cut into the FCC’s auction budget has forced the Commission to lay off about 20 important contractors. “The cap makes it nearly impossible” to run the auction program, Powell said. The Omnibus Appropriations bill established an $85 million cap on auction funding, which comes directly from auction proceeds. The FCC has requested $93.5 million. The Senate Appropriations CJS Subcommittee originally cut the funding completely before it was restored. Powell said the sophisticated program needed the funding to keep it technically viable. Powell said the FCC has properly audited the funding.

Wolf also said the FCC should work to eliminate all corporate-funded travel for Commission staff. Powell said the FCC budget has added $300,000 for additional travel. He said the FCC will be able to fund travel for Commissioners, their staffs and high level officers such as bureau chiefs. However, lower-level staff would still need to travel on industry dime in some circumstances. Powell pointed out that govt. regulations allow this and that all industry-funded travel is approved in his office. While Wolf said Powell has done a good job of addressing the issue -- which he said creates the impression of impropriety -- but the FCC should get its reliance on industry-sponsored travel “down to zero.”

Serrano asked about the FCC’s plans for appealing the U.S. Appeals Court, D.C., Triennial Review Order (see separate story). Powell expressed opposition to the UNE-P portion of the order and said each Commissioner was talking individually with the Solicitor Gen. about whether to appeal. He said should the case be appealed to the Supreme Court, a decision wouldn’t be likely until July 2005. “The market needs to get off the litigation merry-go-round,” Powell said.

Additionally, Wolf asked Powell to quickly get top FCC scientists in touch with Defense Dept. officials to help counter some of the bomb techniques in Iraq. Many bombs are set off by remote controls, sometimes using a wireless phone, and Wolf suggested the FCC might be develop a counter mechanism that would trigger the bombs before they can harm soldiers and civilians. Wolf also questioned the FCC’s request for $2.6 million for vehicles, a request he said seemed “odd.” Powell explained that much of that funding goes to vehicles designed to triangulate radio interference. Also, many of the FCC’s fleet of cars and vans are nearly 15 years old, he said.