Ownership/Diversity Redux: Is the Answer A New Restricted Use FRN?

For years, the FCC has tried to figure out the diversity of broadcast station owners in order to decide whether to adopt rules or special ownership opportunities for minorities. They began doing so a few years ago by changing the ownership reporting form and data for commercial stations. They encountered some hiccups when owners were required to obtain an FCC Registration Number (FRN) to help the FCC track ownership interests. Some owners were reluctant to provide personal social security numbers as part of obtaining an FRN. So the FCC temporarily adopted “Special Use FRNs” that were auto-assigned in the ownership report, and did not require submission of social security number information.

Well, it turns out that the Special Use FRN process has been too confusing for the FCC to track. The result is that they are uncertain about the minority status of about 25% of individuals reported as having broadcast ownership interests of some kind. So what to do?

In its latest attempt to get some clarity on this issue, the FCC has issued a further proposed rulemaking (this is the 7^th one) proposing the use of a “Restricted Use FRN”. Owners with a regular FRN would have to get one in order to report ownership interests in commercial broadcast stations. It would require name, address, gender, ethnicity and the last four digits of the individual’s social security number. Supposedly, there would not be a similar outcry about privacy by using only four of the nine digits in the social security number. Fun, right?

There’s more. If the FCC ultimately adopts similar ownership reporting reforms for noncommercial radio stations (still yet to be decided), it proposes that members of the non-profit licensee’s board of directors be required to obtain and use Restricted Use FRNs as well. Seems crazy to us, since those individuals are often volunteers and actually hold no equity ownership interest in the station assets. More fun.

Those with an opinion on the FCC’s latest ownership-tracking brilliance can let the FCC know what they think. Comments are due by March 30, 2015. Comments must be filed electronically via the FCC electronic comment filing system.