House Doffs 45% Cap

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Frustration with the Federal Communications Commission poured out last week as the House voted to rescind a new FCC rule allowing the owners of ABC, NBC, CBS and Fox to gobble up more TV stations.

Tension had been building since June 2, when the GOP-controlled FCC voted along partisan lines not only to accommodate the Big Four networks but also to relax rules making it possible for one media company to own a market's dominant newspaper, two or three TV stations and up to eight radio stations.

Last Wednesday, the House ignored White House veto threats and voted 400-21 to pass a fiscal 2004 spending bill that would ban the FCC , for one year, from allowing a TV station group from reaching more than 35% of U.S. TV households.

The 35% cap was contained in a $37.9 billion spending bill that included $279 million for the FCC.

The FCC had raised the cap to 45%, triggering a backlash from hundreds of independent network affiliates and other groups that has yet to run its course.

"I will say one thing that I think all of us as elected officials understand. This started as a very quiet, little modest regulatory issue. But it has turned into a firestorm of criticism," Rep. Jay Inslee (D-Wash.) said last Tuesday during House floor debate.

In June, the Senate Commerce Committee voted to restore the 35% limit and the ban on cross-ownership of broadcast outlets and newspapers.

Sen. Byron Dorgan (D-N.D.), with Republican support, said he is guaranteed a Senate floor vote on a resolution that would nullify the entire FCC ruling. A broadcasting source said Sen. Ted Stevens (R-Alaska), chairman of the Appropriations Committee and sponsor of a 35% bill, planned to use the FCC's new budget to restore 35% in September.

"My guess is that there will be some fast and furious action on this when we get back in September," said Dorgan spokesman Barry Piatt. The House and Senate traditionally leave Washington for the month of August, returning soon after Labor Day.

Few political observers expected the outcry that accompanied the FCC vote to result in credible action on Capitol Hill so swiftly.

Moving the cap from 35% to 45% was probably the least deregulatory move the FCC made, but House supporters of the 35% cap feared that attacking the commission more broadly would have drained support from the effort to retain the 35% cap.

Rep. Maurice Hinchey (D-N.Y.) offered a floor amendment that, like Dorgan's resolution, would have restored the status quo ante. But even sympathetic lawmakers — including Reps. David Obey (D-Wisc.) and John Dingell (D-Mich.) — urged Hinchey's defeat, claiming the White House would easily sustain a veto of a bill that totally gutted the FCC's actions. Hinchey's amendment was defeated.

The White House warned last Thursday that it would attempt to protect FCC chairman Michael Powell.

White House spokesman Scott McClellan told reporters traveling with President Bush to Philadelphia that the administration hoped to strip the 35% cap when House and Senate lawmakers meet in conference to prepare a uniform bill.

"We are going to work with Congress to try and fix that in conference," McClellan said, according to Reuters.

Last Monday, Office of Management and Budget director Joshua Bolton told Rep. Billy Tauzin (R-La.) that if the 35% cap passed Congress, President Bush's "senior advisers would recommend that he veto the bill."

Scott Cleland, a media analyst with Precursor Group, said he doubted Bush would veto a bill limited to just the 35% cap.

"I think a very limited, surgical repeal of the 45% cap is doable without a veto," he said. "Remember, all politics are local, so the affiliates have more clout with politicians than the networks. The [congressional] leadership cares about the networks, but not your average congressman."

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