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portunity for additional applications to come in in case of swapoffs or payoffs.

Mr. AVERY. I think we all agree that certainly swapoffs are not in the public interest.

In my own mind, when we start thinking about the application of a legal prohibition we end up a vicious circle because there are so many intangibles that we are not able to touch.

I don't want to preempt the entire time, Mr. Chairman. I have some more questions, but I think I shall defer them, if you like. The CHAIRMAN. Go right ahead.

Mr. AVERY. Mr. Rogers, do you have any questions?

Mr. ROGERS of Texas. I yield to you.

Mr. AVERY. I certainly appreciate the generosity of the gentleman from Texas.

Mr. YOUNGER. Will the gentleman yield?

Mr. AVERY. Of course.

Mr. YOUNGER. Mr. Ford, the law as now written states as follows in 307 (d):

No license granted for the operation of a broadcasting station shall be for a longer term than 3 years.

Why is it necessary for the Commission to make a rule authorizing licenses for less than 3 years?

Mr. FORD. Applicants before the Commission, I think, are entitled to know what they are applying for. Our present rules provide that the license shall be for 3 years. The proposed rulemaking we have would conform to this language.

Mr. YOUNGER. Do you imply that your rule which you now have is not according to the law?

Mr. FORD. It is according to the law because the law authorizes us to grant a license for as much as 3 years. But we have not reserved to ourselves any discretion within that rule.

Mr. YOUNGER. Why do you have to reserve any discretion? It is already in the law. That is the point I am making.

Is there a disagreement in the Commission as to what this law means?

Mr. FORD. I don't think there is any disagreement at all among the Commissioners as to this.

The rule as presently written is to inform the licensee what he may expect in terms of the period that his license will be granted for.

Mr. YOUNGER. Just a minute, please. There is not anything that the Commission can make in the way of a rule which will supersede the law, is there?

Mr. FORD. No, sir.

Mr. YOUNGER. Anybody applying for a license knows under the law that he can receive a license for 3 years or less at the determination of the Commission; is that true?

Mr. FORD. That is true. That is correct.

Mr. YOUNGER. Then why do you need a rule to tell them that? Mr. FORD. Because we exercised that discretion to say that we will grant them for 3 years.

Now, we are proposing to exercise that discretion to put them on notice that they may be granted for less than 3 years.

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Mr. YOUNGER. It looks to me as if you are trying to pass rules that supersede the law. Maybe we should not pass any law and just leave it up to the FCC. Certainly, under the interpretation of this section anyone applying for a license knows that he can get a license for not to exceed 3 years.

But if the Commission wanted to, they could give him a license for 30 days?

Mr. FORD. That is correct.

Mr. YOUNGER. There is nothing in the rule or no power which you have of making a rule that says all of your licenses should be for 3 years. I think if you had exercised your authority and granted licenses for 1 year or 2 years and had put in conditions on licenses, which you certainly have authority under this law to do, there would be no necessity for this legislation.

But apparently, in view of the fact that you have not exercised the authority in the past granted to you under this law, now we have to spell out in the law what you ought to do.

That is the way it looks to me.

That is all, Mr. Chairman.

Mr. AVERY. Mr. Ford, in respect to your comments on section 317, as I understand under the present language of section 317, the Commission has issued or has invited comments on the pending rule whereby even a record that had been received by a broadcaster must be so reported on the broadcast. Am I correct in that?

Mr. FORD. No; that is only a discussion, is the way it is termed, in the public notice. It is a discussion of what we think the law means. Mr. AVERY. I suppose the broadcaster can take that as an indication that a rule might be in the making to that effect?

Mr. FORD. No; he takes that as an indication that this is the Commission's view of what the statute means.

Mr. AVERY. If that is what it means, how can he escape making such announcement?

Mr. FORD. We don't think he can.

Mr. AVERY. In other words, we may expect unless the present language is amended, that even if a single record is presented as a gratuity to a broadcaster it must be so identified every time it is played or just once?

Mr. FORD. There is dispute as to that. The industry disputes that. We have issued a notice of inquiry to permit members of the industry and interested persons to file memorandums of law discussing various features of this public notice which they claim does not accurately interpret the law.

Mr. AVERY. But finally the Commission is going to have to make the decision?

Mr. FORD. We will have to make the decision as to what we think.
Mr. AVERY. Unless the language of section 317 is amended?
Mr. FORD. That is correct.

Mr. AVERY. I notice at the bottom of page 20 of your statement you say you feel that this term property is too broad and the Commission should have authority to exempt certain material that they think is in the public interest.

What is an example of that kind of material?

Mr. FORD. There is material, records, film clips of one sort or another, furnished by various charitable organizations, such as the Red Cross, war bond drives, matters of that kind. Usually that type of broadcast carries within the body of it the idea that it is furnished by the Red Cross. But sometimes they may not.

Mr. AVERY. I am thinking about Members of Congress that send out news clips once in awhile. Are news items going to be in a different category than records? I think almost every Member of Congress, in addition to news clips, sends out so-called educational programs, I think, to enlighten their constituents on various problems before the Congress.

Some limit those to 5 minutes, others to 15. I understand some go as long as 30. I am just wondering, since that is a gratuity to the licensee, I am wondering under this bill if we can differentiate between a 39-cent record and a matter of great educational importance, such as the news clips the Members of Congress send out.

Mr. FORD. Normally if it is a news source we don't get into that. This is a little more difficult question. I would hesitate to give an off-the-cuff answer to this question.

Mr. AVERY. I can understand. It is a rather penetrating question. As I read the language in section 317, unless there is going to be some exemption made, it would appear to me that it is probably covered.

Mr. FORD. It is probably covered in the present 317. We have not ruled on that. I would hesitate to answer that.

Mr. AVERY. Actually it seems to me that might be helpful to Members of Congress because they would get additional recognition. They would interrupt a 5-minute or 15-minute news program by saying the following interview was provided us with Senator So and So from the Capital City and then proceed with the news film itself. Would that not be the circumstance?

Mr. FORD. I can imagine situations in which that would be extremely helpful. That is, to the Member of Congress.

Mr. AVERY. It depends on what he said.

I think that is all, Mr. Chairman. Thank you very much.
Thank you, Mr. Ford, for your consideration.

The CHAIRMAN. Mr. Ford, let us take H.R. 11341. The first section would amend section 309. It would amend it in two broad phases: First, it provides for mandatory hearings with reference to initial grants of licenses.

You do not believe that as proposed here it would be in the public interests to require hearings to be held in the local area in every case? Mr. FORD. That is correct. That is in every case.

The CHAIRMAN. Do you agree that in some instances such hearings should be held?

Mr. FORD. Yes, very definitely. In some instances they are.

The CHAIRMAN. In some instances hearings have been held in the community?

Mr. FORD. Yes. Not only original licenses, but renewal hearings or revocations.

The CHAIRMAN. Have you every revoked a license?

Mr. FORD. Yes.

The CHAIRMAN. When was the last one revoked? I was not aware that there had been any revocations.

Mr. FORD. I think the cause of the confusion is that you asked the question very generally and I answered it generally, whereas the people are usually talking about for program reasons. The Wilco case was one. There have been a number of revocations.

When you see the language quoted, you see it quoted with respect to program matters and those are quite old cases.

The CHAIRMAN. What consideration is given by the Commission to statements contained in applications for licenses as to proposed programing?

Mr. FORD. In each case in which there is an application the staff prepares a flimsy.

The CHAIRMAN. A what?

Mr. FORD. What is called a flimsy. It is a slang term for an analysis of the application. In that analysis they put the program types, and various percentages of types that will be broadcast, spot announcements, and that sort of thing.

The CHAIRMAN. Are these statements as to programs significant in noncontested applications as well as in contested applications?

Mr. FORD. I think the same procedure is followed in both types of

cases.

Frequently we ask for additional information on programing.

The CHAIRMAN. As a matter of fact, can local groups which are interested in proposed programing really participate in hearings unless the hearings are held locally rather than here in Washington? Mr. FORD. I don't think so.

The CHAIRMAN. Then since you oppose local hearings, would you have any alternative suggestion, as to how the local needs with regard to programing can be brought out in case of an uncontested or contested application?

Mr. FORD. Our opposition did not go to the point of local hearings. The question that was involved was the slowing down of the processes. In those instances that appear to require local hearings, I am sure the Commission would have no objection to local hearings, providing we had the money. That is always a deterring factor.

The CHAIRMAN. When was the last time that you held a hearing in a local community?

Mr. FORD. About 1956 or 1957, in Boston. WMEX.

The CHAIRMAN. How many hearings have been held in the locality in the last 10 years, if you know?

Mr. FORD. If you include 10 years I, will have to check.

Mr. HYDE. Prior to the 1952 amendments quite a number of hearings were held in the field. The Commission undertook to conduct many of them there. Commissioners themselves conducted hearings in order to help handle the workload.

I conducted hearings myself in such places as Kansas, Iowa, Colorado, Maryland, California. This is prohibited under the 1952 amendments.

The CHAIRMAN. Commissioner, I was getting to that provision. I wanted to ask you about this since you have had many years of experience on the Commission. As a matter of fact, I assume you are as familiar with communications law and the Commission's procedure as anybody in Washington.

The 1952 amendments took away from the Commission certain powers in determining some matters on the basis of public interest, convenience, and necessity, did it not?

Mr. HYDE. The MacFarland amendments prohibited individual Commissioners from conducting hearings. It did not prohibit the entire Commission from sitting en banc and conducting a hearing, but obviously, the whole board cannot conduct a large number of hearings and take care of their other duties.

The CHAIRMAN. In matters of transfers, did not the amendments go so far as to say that the Commission could not consider whether transfer to a person other than the proposed transferee would be in the public interest?

Mr. HYDE. I believe, Mr. Chairman, that the changes in the 1952 amendments were to limit the scope of our examination of renewal or transfer.

Yes, I have the language right here. It did provide that any such application, referring to a transfer or assignment, shall be disposed of as if the proposed transferee or asignee were making application under section 308 for the permit or license in question.

But in acting thereon, the Commission may not consider whether public interest, convenience, and necessity might be served by the transfer, assignment, or disposal of the permit or license to a person other than the proposed transferee or assignee.

I think that limitation on what we might do was suggested by an earlier effort on rulemaking when the Commission undertook to make it possible to consider what you might call alternate transferees. The CHAIRMAN. Do you agree with me that that prohibition should be repealed, or would you want to make a comment about that? Mr. HYDE. I think that you should give the Commission broader discretion than is permitted here, yes.

I am not proposing in this, however, to recommend adoption of what we call the Avco rules, because our experience with them was not satisfactory.

The CHAIRMAN. At the same time, do you agree that it is going a little far to limit the Commission in the consideration of the public interest in most anything it has to do?

Mr. HYDE. I think it would have been well to have given the Commission more discretion and more responsibility here than is permitted under the amendment.

The CHAIRMAN. Now, Mr. Ford, that hearing at Boston that you referred to, was that on an original or a renewal application? The CHAIRMAN. That was a renewal application.

The CHAIRMAN. Do you ever hold hearings in any locality on an original application?

Mr. FORD. As you said a while ago, in the last 10 years. About that time each year there would be a schedule of hearings. I know I have participated in the circuit of holding hearings around in the various communities.

Recently we just haven't had that kind of money.

Usually at that time the nonengineering portion is within the field. I know as a fact that frequently members of the public would come in and testify. But the engineering portion of those hearings at that time were held here in Washington.

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