LMAs skate on thin ice

Sep 3, 2001  •  Post A Comment

Several operators of local marketing agreements are operating illegally.
The LMA operators are ducking the Federal Communications Commission’s breakup deadline, hoping that the agency’s new GOP majority or the courts will allow them to keep their TV station combinations permanently.
“Everybody’s hiding in the bushes,” said one communications attorney who asked not to be identified.
One of the affected LMA operators is Fox affiliate KXTF-TV in Twin Falls, Idaho, which has an LMA to operate a second Fox affiliate, KFXP-TV, in Pocatello, Idaho.
In a petition filed Aug. 6 with the FCC, the stations said they wanted to preserve the LMA at least until the courts rule on a pending lawsuit by Sinclair Broadcast Group that could ax the FCC’s restrictions altogether.
When the FCC revised its duopoly regulations two years ago to permit broadcasters to buy a second TV station in major markets, it said local marketing agreements entered into after Nov. 5, 1996, that didn’t qualify for duopoly relief would have to be ended by Aug. 6 of this year.
A decision in the Sinclair case is expected as early as next spring.
The court has already stayed the divestiture requirement for Sinclair’s four affected combinations, but the stay applies only to Sinclair.
The Idaho stations want a regulatory ruling extending the stay to them. “Don’t make us disband the LMA and cause us a lot of disruption if the court is going to knock it down,” said Howard Weiss, an attorney for KFXP.
In addition, Pegasus Broadcasting last month asked the FCC for a waiver from the agency’s divestiture requirement for its Fox affiliate WOLF-TV in Wilkes-Barre, Pa., which has an LMA to operate The WB affiliate, WSWB-TV, in the same market.
“The basis for the waiver is that the Pegasus LMA would have been in effect before the Nov. 5, 1996, cutoff but [was stalled by an] FCC delay in action on a construction permit application,” said Denise Rolfe, Pegasus vice president of broadcast operations.
It’s unclear how many other LMAs are ducking the FCC’s divestiture requirement, because agency officials said they were unaware of how many stations faced or met the obligation.
In the Idaho case, the request for relief is being opposed by ABC affiliate KIFI-TV in Idaho Falls., which is arguing that the Fox affiliates put off their request until the divestiture date itself.
“That’s way too late,” said Kathy Schmeltzer, a KIFI attorney.
One broadcast industry source said the FCC could have avoided the uncertainty by simply having extended the divestiture relief that Sinclair won from the court in June to all affected broadcasters.
“That’s just bad management,” the source said.
When the FCC changed its duopoly rules, it said that LMAs, or agreements allowing one station to operate another in the same market, entered into before Nov. 5, 1996-the date the FCC proposed to consider relaxing the ownership restrictions-would be grandfathered for at least five years before they would be subject to agency review.
But LMAs entered after that date were accorded less protection on the theory that broadcasters have been put on notice that possible changes were in the works.