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Holy War for PBS Station

Jul 10, 2005  •  Post A Comment

A dispute between a local community college and a Christian broadcaster may turn on this question: Does preaching about God on TV fulfill the mandate that a station’s programming serve the educational, instructional or cultural needs of a community?

The fight is between Coast Community College District in Orange County, Calif., and televangelist powerhouse Daystar Television Network, which owns more than 40 TV stations in the United States. The community college district put up for sale a PBS station it had been operating.

The California 4th District Court of Appeal ruled last month that the college district acted improperly when it sold KOCE-TV to the foundation that raises money for the station. The court said the sale process violated a state law requiring that the station be sold to the highest bidder. Judge David Sill wrote that the KOCE Foundation’s arrangement amounted to “no better than a post-dated check.”

The college district accepted a $32 million bid for the station from the KOCE Foundation over a $40 million Daystar bid that arrived a day after the deadline.

Jerry Starr, executive director of Citizens for Public Broadcasting, said the court’s decision shows that guidelines that govern use of noncommercial channels are murky.

“The large[r] issue is about the religious right’s ability to take over public stations,” Mr. Starr said. “It’s the failure of the [Federal Communications Commission] to adequately clarify and enforce educational guidelines.”

Broadcasters seeking a license to use noncommercial frequencies are supposed to prove that more than half of their programming will be “primarily educational,” the FCC stated in 2000. To qualify, “A program must have as its primary purpose service to the educational, instructional or cultural needs of the community.”

KOCE currently broadcasts on a band reserved for noncommercial programming and requires a noncommercial education license to operate.

“If [the college district] feels it has an educational mission, then they have to honor the license and its original issuance,” Mr. Starr said.

“No matter who owns the station, they will have to keep it noncommercial unless they petition the FCC to de-reserve the channel,” said Margo Davenport, an FCC spokeswoman.

The FCC has granted such a petition only once before, in 2002, when it de-reserved a public station, WQED-TV in Pittsburgh, that was $9 million in debt and had the opportunity to sell its channel to a commercial broadcaster.

The trustees of the station’s former owner, the college district, plan to decide during a July 20 meeting whether to appeal the California 4th District Court of Appeal’s June 23 ruling that reversed the sale of Channel 50 to the KOCE Foundation, the station’s longtime fund-raising arm. The foundation has been operating the channel since November and has kept its PBS programming lineup.

Although the three-judge panel limited the basis for its decision to financial matters, saying that the district could not accept a credit sale, Judge Sill made multiple mentions of bias he saw against Texas-based Christian broadcaster Daystar. He wrote that a trustee implied in a statement that the district was “bound and determined from the beginning to ‘filter out’ any televangelists.”

Daystar attorney Richard L. Sherman said the ruling got to the heart of the matter. “We were able to prove favoritism and discrimination against the Christian broadcasters, that the board members had their own agenda,” he said.

Daystar, which operates commercially under the name Word of God Fellowship, has grown in the past two decades into the second-largest Christian TV network in the world.

According to Daystar’s Web site, preacher Marcus Lamb married Joni Trammell and in 1984, “Following God’s specific guidance, they moved to Montgomery, Ala., to build WMCF-TV 45,” and thus Daystar was born. The network has a “singular goal,” according to the site: “To reach souls with the good news of Jesus Christ.”

The KOCE flap marks the first time a court has rejected the sale of a PBS station. While the decision has not disrupted the channel’s operations, the ruling has kept the players in limbo as they consider ownership scenarios.

A PBS spokeswoman said the network considers the KOCE case purely a local issue and that it will not speculate on any national implications.

The KOCE Foundation currently holds KOCE’s broadcasting license. If the district appeals the sale reversal, a decision might not be made for months, in which case the foundation will continue to hold the license.

The FCC, which approved the license transfer last fall, will not be involved unless ownership changes hands again, Ms. Davenport said. If the district does not appeal and retains ownership, it will have to reapply for a broadcasting license, she said.

“Plan A is to get this turned around,” said Mel Rogers, president and general manager of KOCE-TV. “The worst case in our view is, we hope, that we could enter into a lease agreement with the district.”

A lease agreement, or local marketing agreement, would allow the KOCE Foundation to run and finance the station. The district would remain the legal owner and hold the FCC broadcasting license. A lawyer for the foundation refused to comment on the possibility of such an arrangement.

If the trustees decide not to appeal, they can either hold a new sale or take the station off the market, the appeals court ruled.

When the Huntington Beach, Calif.-based college district decided to sell KOCE in 2002, Daystar bid $25.1 million for the station. On the last day of bidding, the KOCE Foundation, which has many wealthy individual supporters, offered $8 million up front with a promise to pay $24 million with interest over 30 years.

Daystar upped its offer to $40 million the next day, but the bid was declined for being too late.

After the district accepted the foundation’s $32 million bid, the trustees reduced the price tag to $28 million, saying that because the foundation planned to continue PBS programming, the district could avoid having to refund $4 million in grants and funding to the Corporation for Public Broadcasting and other donors.

Those at KOCE have not tried to hide their preference that the foundation continue to own the station. “What we’re doing is obviously valued,” Mr. Rogers said. “[Daystar’s] pattern is to do televangelism out of Texas, and then the station becomes a local translator for that national feed. … That’s why the survival under the auspices of the KOCE Foundation is so important for so many people.”

KOCE-TV is Orange County’s sole PBS station. Mr. Rogers also maintained that Daystar’s $40 million offer simply came too late, and he was “pretty surprised that the judge saw it as a valid bid.”

In further defense of the sale, Mr. Rogers cited a letter the district received from the CPB warning that if the district sold KOCE to a non-PBS entity, it might have to give back the CPB’s community service grants. The CPB gives $1.4 million a year to KOCE, about 15 percent of the station’s yearly funding.

Daystar is preparing a lawsuit against district board members for breach of fiduciary duty, or violating their legal obligation to sell to the highest bidder, Mr. Sherman said. “If they could’ve pumped $40 million into the school system-that would have been their best option,” he said. Daystar is still interested in bidding if there is a new sale, he said.