Report No. MM95-21           MASS MEDIA ACTION                March 7, 1995


         GRAFTON PUBLIC SCHOOL DISTRICT #3 GRANTED CP AND LICENSE
                   FOR ITFS CHANNELS C1-C4 IN MILTON, ND

     The Commission has conditionally granted the application of
Grafton Public School District #3 for a construction permit (CP)
and license in the Instructional Television Fixed Service (ITFS)
on Channels C1-C4 in Milton, ND; and denied the competing
application of Dakota Prairie School District #1 for ITFS
channels at Inkster, ND.

     In cases of mutually exclusive  ITFS applications, where
applicants are competing for the same or adjacent channels in the
same geographic area, each application is reviewed pursuant to
the Commission's comparative process.  This procedure awards a
maximum of 12 merit points based on five criteria deemed most
relevant to predicting the applicant best qualified to provide
the service for which the ITFS spectrum was allocated.

     In this case, Dakota was awarded four points for being
local, three points for being accredited, and two points for
observing the four-channel limitation, for a total of nine
points.  Grafton received four points for being local, three
points for being accredited, two points for observing the four-
channel limitation, and two points for proposing at least 41
hours of formal educational programming per channel per week, for
a total of 11 points.  Thus, Grafton is the tentative selectee.

     Grafton proposed leasing its excess capacity for non-ITFS
use and submitted a copy of its lease agreement with Control
Technology, Inc. (CTI).  Generally, the parties to an excess
capacity lease agreement are identified as the lessor and lessee. 
The ITFS licensee (in this case Grafton) is the lessor, and the
wireless cable operator (CTI) is the lessee.  However, the lease
agreement identified Grafton as the lessee and CTI as the lessor. 
Because of this mislabeling, the Commission was unable to review
the lease to determine if it conformed in all respects to FCC
requirements.  According, the Commission instructed Grafton to
submit for review a lease agreement which correctly and
consistently identifies the parties and their respective
obligations.


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     The Commission noted, however, that this does not reflect on
Grafton's basic or comparative qualifications, nor preclude grant
of an authorization.

     Action by the Commission February 28, 1995, by Memorandum
Opinion and Order (FCC 95-85).  Chairman Hundt, Commissioners
Quello, Barrett, Ness, and Chong.


                                   -FCC-

     News Media contact: Patricia A. Chew at (202) 418-0500.
     Mass Media Bureau contact: Marsha Evans at (202) 418-1610.