Telecommunications Minority Assistance Program Announcement of Administration Program.

The Carter administration today announced a program to increase minority ownership in electronic communications. The program will encourage minority ownership of broadcast and cable television facilities and increase the flow of Federal advertising dollars to minority owned stations, publications, and advertising and production firms.

Because of telecommunications' vital role in social, economic, and political progress, full minority participation is a critical component of President Carter's economic and social policy goals. Minority ownership markedly serves the public interest, for it ensures the sustained and increased sensitivity to minority audiences. Today, fewer than 1 percent of the Nation's commercial and public radio and television stations and cable television systems are owned or controlled by minorities.

Historically, minorities seeking broadcast ownership have faced:

—difficulty obtaining initial financing;

—a shortage of available properties because most communications assignments were made years ago;

—barriers to technical training and employment opportunities;

—difficulty in attracting advertising to support operations. The administration seeks to remove these barriers with a comprehensive package including:

—urging the Federal Communications Commission to adopt a minority ownership policy;

—changes in loan policies of the Small Business Administration and the Economic Development Administration;

—initiating an American Indian ownership and training program at the Department of Labor;

—changes in the Public Broadcasting Act to make more public broadcasting facilities money available to minorities;

—developing Federal guidelines to help ensure more agency advertising money for minority outlets and advertising firms;

—working with communications industry and professional groups which are developing minority ownership assistance programs.

A petition filed today with the FCC was signed by the Office of Telecommunications Policy and the Department of Commerce on behalf of the administration. It urged the FCC to establish a policy promoting ownership of broadcast facilities by minorities in areas with minority populations. If adopted, the policy would justify modifications of other Commission policies and rules in all areas of FCC license processing so that more broadcast properties and funding prospects would be available for minority applicants.

The petition suggests:

—In comparative hearings (more than one applicant) for licenses, a preference be given to applicants where minorities participate in ownership.

—In the noncomparative licensing process, the Commission should take various steps, including:

• expedite the processing of minority applications;

• permit minorities to operate stations part-time through extensive brokerage of broadcast time, giving minority entrepreneurs an opportunity to develop management experience;

• adopt the National Association of Broadcasters proposal permitting deferral of capital gains taxes for broadcasters who sell their stations to minority entrepreneurs;

• make minority ownership a basis for waiving limitations on the number of television stations one owner may acquire in the 50 largest television markets;

• lessen the financial requirements for minority applicants to facilitate licensing;

• adopt the Congressional Black Caucus proposal to permit sales at reduced prices of stations designated for license renewal or revocation hearings to groups with at least 50 percent minority ownership.

To ease initial financing problems, the SBA and the EDA have announced rule changes to extend their loan and loan guarantee programs to broadcast and cable facilities. The SBA program will extend direct loans of up to $350,000 and guarantee loans up to $500,000 to individuals or groups wishing to buy cable and broadcast properties. The EDA will extend its loan program to broadcasting and cable consistent with its job-ratio requirement of creating one direct job for every $10,000 expended and/or where EDA has invested considerable resources in a community's development. Both agencies intend minorities to be the major beneficiaries of their rule changes.

The Department of Labor has launched a program to assist native American communities in starting communications facilities. The program will provide training coordinated with various Government loan programs.

Public broadcasting would be further opened to minorities by President Carter's Public Broadcasting Act, proposed in October 1977. The bill would change the grant program for public broadcasting facilities to make minority control a primary consideration for choosing grantees.

In addition, the administration program addresses Federal agencies' advertising programs. The Office of Federal Procurement Policy, Office of Management and Budget, is working with the Department of Defense, AMTRAK, the Postal Service, and other agencies which advertise to establish by June 1978 policies and procedures to increase the flow of Federal advertising business to minority-owned advertising and production firms and to minority-owned media.

The administration also has been coordinating with professional and industry groups in seeking to promote minority assistance programs:

—The National Association of Broadcasters has formed a Minority Ownership Task Force with representatives from the broadcasting industry, civil rights organizations, and foundations to develop financial assistance and other remedies for potential minority broadcast owners.

—The National Radio Broadcasters Association has drafted a program to establish an information clearinghouse on available radio properties and a "buddy system," making management and financing assistance available to qualified potential and existing minority broadcasters.

—The National Cable Television Association, through a program it established a year ago, has helped establish the American Association of Cable Television Owners, an organization to assist minorities in obtaining debt financing for cable television. In addition, NCTA has formed an advisory committee of financiers and cable brokers who give free assistance to minority cable franchise holders and who are working with the financial community to bring them together with minority cable franchisees.

—The Federal Communications Bar Association has established a free and reduced fee legal assistance program for qualified minorities.

—The American Association of Advertising Agencies (AAAA) has formed a Task Force of the AAAA, the Association of National Advertisers, the American Research Foundation, and minority station owners to examine the methods employed by rating services in measuring minority audiences and the industry's advertising selling practices as they relate to minority outlets.

The administration program was developed by the Office of Telecommunications Policy and the White House staff as part of President Carter's efforts to aid minority business. Coordination of the program will be assumed by the National Telecommunications and Information Administration in the Commerce Department when it replaces OTP upon implementation of Reorganization Plan No. 1. In the future, the program will include initiatives in advertising and rating practices and minority participation in the development of emerging telecommunications services.