$// MO&O, KSBW-TV Salinas, CA Renewal, rep. cond., forf., FCC 94-239 //$ $/ 300.309 Action Upon Applications /$ $/ 73.2080 Equal Employment Opportunity /$ $/ 300.503 Forfeiture in Cases of Rebates and Offsets /$ $/ 1.80 Forfeiture Provisions /$ $/ FOR FCC RECORD ONLY /$ Before the Federal Communications Commission Washington, D.C. 20554 FCC 94-239 In re Application of ) ) KSBW License, Inc. ) File No.: BRCT-930730KJ ) For Renewal of License for ) Station KSBW-TV ) Salinas, California ) MEMORANDUM OPINION AND ORDER AND NOTICE OF APPARENT LIABILITY Adopted: September 19, 1994 Released: November 4, 1994 By the Commission: Commissioner Quello concurring in the result. I. INTRODUCTION 1. The Commission has before it for consideration: (i) a license renewal application for the captioned television station in Salinas, California; (ii) a Petition to Deny timely filed on November 1, 1993, by the California State Conference of Branches of National Association for the Advancement of Colored People ("NAACP") and the League of United Latin American Citizens ("LULAC"), through its California State Board of Directors (collectively "Petitioners"); (iii) the licensee's opposition; and (iv) the licensee's response to a staff letter of inquiry. 2. The Petitioners allege that the challenged station violated our Equal Employment Opportunity (EEO) Rule and policies. Accordingly, both organizations request that we conduct an investigation of the station's employment practices pursuant to Bilingual Bicultural Coalition on Mass Media, Inc. v. FCC, 595 F.2d 62) (D.C. Cir. 1978) (Bilingual), designate the renewal application for hearing and, thereafter, deny the application. The licensee responds that the Petitioners have presented no evidence of discrimination, that the records indicate compliance with the Commission's EEO Rule, and that unconditional renewal is warranted. II. PLEADINGS 3. STANDING. In challenging an application pursuant to Section 309(d) of the Communications Act, a petitioner must demonstrate party in interest status. In addition, a petitioner must, as a threshold matter, submit, "specific allegations of fact sufficient to show ... that a grant of the application would be prima facie inconsistent with [the public interest, convenience and necessity]." 47 U.S.C.  309(d)(1); Astroline Communications Co. v. FCC, 857 F.2d 1556 (D.C. Cir. 1988) (Astroline); Application of Dubuque T.V. Limited Partnership and Sage Broadcasting Corporation of Dubuque, Iowa for Assignment of Television License for KDUB-TV, Dubuque, Iowa, 4 FCC Rcd 1999 (1989). The allegations, except those of which official notice may be taken, must be supported by the affidavit of a person with knowledge of the facts alleged. 47 U.S.C. Section 309(d)(1). 4. Submitted with the petition is a declaration from Frances Armstrong, a member of the NAACP who states that she is a regular viewer of Station KSBW-TV and that she would be seriously aggrieved if the petition is not granted. Filed with the LULAC petition to deny is a declaration from William Melendez, a member of LULAC. Mr. Melendez states that he is a regular viewer of Station of KSBW-TV and would be seriously aggrieved if the petition is not granted. We find that both statements meet the requirements for standing. Accordingly, we hold that both organizations have petitioner status against Station KSBW-TV. See American Legal Foundation v. FCC, 808 F.2d 84 (D.C. Cir. 1987); see also Petition for Rule Making to Establish Standards for Determining the Standing of a Party to Petition to Deny a Broadcast Application, 82 FCC 2d 89 (1980) (citing Warth v. Seldin, 422 U.S. 490, 511 (1975)). III. DISCUSSION 5. PRIMA FACIE CASE. The Petitioners derived their factual allegations from the licensee's EEO programs and annual employment reports. Review of the licensee's EEO records led us initially to conclude that the Petitioners presented a prima facie case against the station demonstrating that unconditional grant of the renewal application would have been inconsistent with the public interest. Section 309(d)(1) of the Communications Act of 1934, 47 U.S.C. Section 309(d)(1). Astroline, supra. Further inquiry was therefore necessary. See Beaumont Branch of the NAACP and the National Black Media Coalition v. FCC, 854 F.2d 501, 506 (D.C. Cir. 1988) (Beaumont); Bilingual, supra. 6. Review of the Petitioners' EEO allegations, as well as the licensees' opposition and inquiry responses, leads us to conclude that there are no substantial and material questions of fact warranting designation for hearing. In addition, we find no evidence of employment discrimination. Thus, grant of the application will serve the public interest. 47 U.S.C.  309(d)(2); Astroline, supra. However, we will grant renewal with appropriate remedies and sanctions because the licensee's overall recruitment efforts were deficient. 7. Section 73.2080 of the Commission's Rules, 47 C.F.R.  73.2080, requires that a broadcast licensee refrain from employment discrimination and establish and maintain an affirmative action program reflecting positive and continuing efforts to recruit, employ and promote qualified women and minorities. When evaluating EEO performance, the Commission focuses on the licensee's efforts to recruit, employ and promote qualified minorities and women and the licensee's ongoing assessment of its EEO efforts. Such an assessment enables the licensee to take corrective action if qualified minorities and women are not present in the applicant pool. The Commission also focuses on any evidence of discrimination by the licensee. See  73.2080(b) and 73.2080(c). 8. When the renewal application indicates an absence of discrimination and a record of adequate EEO efforts, the application is granted, if otherwise appropriate. When the renewal application fails to evidence a record of adequate EEO efforts, the Commission may impose a variety of sanctions or remedies, such as reporting conditions, renewal for less than a full term, forfeiture, or a combination thereof. Further, the Commission will designate the application for hearing if the facts so warrant. Amendment of Part 73 of the Commission's Rules Concerning Equal Employment Opportunity in the Broadcast Radio and Television Services, 2 FCC Rcd 3967 (1987)(Broadcast EEO), petition for recon. pending; see also 4 FCC Rcd 1715 (1989)(request for clarification by the National Association of Broadcasters). See e.g., Beaumont, supra; Bilingual, supra. 9. The licensee's renewal application, opposition and inquiry response reveal that the licensee filled 72 full-time, including 63 upper-level vacancies, from June 1, 1990 to November 30, 1993. In its inquiry response, the licensee provided the recruitment sources contacted for 71 vacancies. For these vacancies, the licensee contacted the following sources for the cited number of positions: Local newspapers (3); Media Line (7); Broadcasting & Cable (3); Electronic Media (1); Media Line & Broadcasting & Cable (4). For 20 vacancies, the licensee contacted The Californian, Monterey Herald, and El Sol. In addition to these three sources, the licensee contacted some of the following for 18 vacancies: SJ Mercury, KSBW, SF Examiner, local newspapers, Sentinel, Robert Half Associates, and Electronic Media. For the remaining vacancies, the licensee contacted some of the following: Audience, Research & Development Corporation, American Association of Asian American Journalists, Society of Black Journalists, Society of Hispanic Journalists and Chicano News. 10. The licensee provided the number, gender and race or national origin of the applicants for only 59 positions; and the number gender and race or national origin of the interviewees for only 56 vacancies. Further, the licensee provided the referral source, gender and race or national origin for only 65 successful applicants. According to the licensee's inquiry response, successful applicants came from: Monterey Herald (10); Media Line (14), including five Hispanics and one American Indian); The Californian (five, including one Hispanic); professional association (one, including one Asian/Pacific Islander); internal reference (four, including one African American); "word of mouth" (seven, including one Hispanic); local newspapers (four, including one American Indian); Broadcasting & Cable (seven, including one Hispanic and one American Indian); unsolicited (six, including one Hispanic); American Association of Asian American Journalists (one, including one Asian/Pacific Islander); Electronic Media (three); Ron Steiner (two); and Robert Half Associates (one). The licensee apparently attracted minorities to 44 (61%) of the 72 applicant pools, and 41 (56%) of its interview pools, including 38 (60%) of the applicant pools and 35 (55%) of the interview pools for upper-level positions. The licensee hired 15 minorities (nine Hispanics, three American Indians, two Asian/Pacific Islanders, and one Black), all for upper-level positions. 11. Petitioners argue that the station has not complied with our EEO Rule. The Petitioners note a decrease of nine minority upper-level job employees despite an increase of 11 upper-level job employees since KSBW License Inc. acquired the station in 1986. Further, Petitioners argue that during the 12 months preceding the filing of the renewal application, there were only 12 minorities among 41 total hires. Moreover, they contend that the 1988 Renewal Application reflects only five minorities out of 42 full-time hires and that the 1993 Renewal Application reports only one upper-level position among 41 vacancies. Also, the Petitioners note that the station's 1993 Annual Employment reflects 86 upper-level job employees among 97 full-time employees, and that 94 upper-four employees were among 106 total employees (including part-time employees). Finally, the Petitioners argue that while the 1993 Renewal Application identified minority sources, it did not indicate that these sources were contacted for every vacancy, and that it did not list the number of referrals from most recruitment sources. 12. In opposition, the licensee states that the Petitioners rely on erroneous information. Contending that the original Annual Employment Reports for the years 1990-1993 were in error, the licensee submitted revised reports for these years. Also, the licensee faults the Petitioners for using 1990 U.S. Census Labor Force data in analyzing the entire license term and argues that the 1993 Annual Employment Report should be evaluated using 1990 statistics, and that 1980 data should be used for all Annual Employment Reports prior to 1993. Moreover, the station contends that the Commission's practice is to examine only the current license term under review and that the Petitioners' discussion of 1986-1988 employment figures relate to the previous license term and are irrelevant. The licensee also asserts that as a result of its EEO program, minorities occupy "numerous visible and influential positions at the station." Finally, the licensee states that with the exception of 1989, the station's full-time minority employment has exceeded the Commission's guideline of 50% of parity and that its minority hiring and promotion exceeds 50% of parity. 13. There are no substantial and material questions of fact warranting designation for hearing. Astroline, supra. The licensee hired and employed minorities and there is no evidence of employment discrimination. See, n. 2 supra. In addition, the licensee contacted referral sources, including minority-oriented sources, for some of its vacancies. Therefore, renewal of the license is in the public interest. 14. However, we find KSBW-TV's overall recruitment efforts deficient because minorities were absent from a significant number of the licensee's applicant pools and it failed to contact minority specific sources for over one third of its vacancies. The licensee also failed to maintain adequate records for meaningful self-assessment. 47 C.F.R.  73.2080. 15. Earlier this year, we adopted a Policy Statement regarding forfeitures to be assessed for violations of our EEO rules. Standards for Assessing Forfeitures for Violations of the Broadcast EEO Rules, 9 FCC Rcd 929 (1994) ("EEO Policy Statement")(petitions for reconsideration and requests for clarification pending). A court decision issued since the EEO Policy Statement indicated that our general policy statement on forfeitures must be put out for notice and comment. United States Telephone Ass'n v. FCC, 28 F.3d 1232 (D.C. Cir. 1994). While the USTA case did not address our EEO Policy Statement, members of the broadcast community have called for the withdrawal of the EEO Policy Statement until it is likewise made available to the public for notice and comment. See, e.g., Petition for Declaratory Ruling by Eagle Radio, Inc. (filed August 11, 1994); Letter from Henry L. Baumann to William E. Kennard, July 13, 1994. We will respond to these concerns in a separate order. In the meantime, we will utilize our pre-January 1994 process of stare decisis by relying upon case precedent to resolve the decisional case. 16. Under our previous forfeiture authority, which was prior to December 1989, we used a process of stare decisis. We would analogize the cases based on factors such as, but not limited to, station size, number of hiring opportunities, MSA size, recruitment patterns, applicant and interview pools, assessment and record-keeping. Under this approach, in determining appropriate sanctions and/or remedies, we have carefully considered the facts and circumstances of this case in light of pertinent case precedent. We believe that the record in the instant case is similar to, but more egregious than, that of the licensee of KESQ-TV, Palm Springs, California, in Applications of Certain Television Stations Serving Communities in the State of California, 6 FCC Rcd 2340 (1991). The licensee therein used minority sources for 37 of its 70 full-time positions and for 34 of its 56 upper-level positions. KESQ-TV used general recruitment sources for 64 of the 70 full-time positions, and interviewed 161 applicants for 56 upper-level positions, only ten of whom were minorities. In addition, the licensee interviewed 205 applicants, including 13 minorities to fill 70 full-time positions. The licensee hired six minorities, including four Hispanics, for its upper-level staff. On its full-time staff, it hired eight minorities, six of whom were Hispanic. Minorities constituted 23.8% of the labor force for the Riverside - San Bernardino, California MSA. In that case, we concluded that the licensee failed to engage in adequate recruitment and conduct meaningful self-assessment of its EEO program, given the lack of minority applicants and hires. The licensee received a $5,000 Notice of Apparent Liability and reporting conditions. 17. KESQ-TV, although issued in 1991, was decided based on a former forfeiture authority, which was significantly lower. Previously, the forfeiture penalty assessed against a broadcaster could "not exceed $2,000 for each violation or each day of a continuing violation, except that the amount assessed for any continuing violation could not exceed a total of $20,000". In 1989, Congress substantially increased the dollar amounts of our forfeiture authority. Pub. L. No. 100-239, 103 Stat. 2131. Pursuant to Section 503(b)(2), the forfeiture penalty assessed against a broadcaster may "not exceed $25,000 for each violation or each day of a continuing violation, except that the amount assessed for any continuing violation shall not exceed a total of $250,000 for any single act or failure to act". However, even before our forfeiture authority was expanded in 1989, we assessed substantial fines for EEO recruitment deficiencies. See e.g., Kansas City Youth for Christ, 3 FCC Rcd 6866 (1988) (licensee received $10,000 forfeiture, short-term renewal and reporting conditions for failure to self-assess and make any efforts to recruit women or minorities); In re Applications of Certain Broadcast Stations Serving Communities in the State of South Carolina, 5 FCC Rcd 1704 (1990) (licensee received $10,000 forfeiture, short-term renewal and reporting conditions where it failed to hire minorities for upper-level positions in a 6 1/2 year period, and did not use recruitment sources which generated minority referrals); Commission's Letter to John P. Healy, Treasure Coast Radio, Inc., 5 FCC Rcd 3745 (1990) (licensee received $10,000 forfeiture and reporting conditions where its recruitment efforts attracted no minority candidates in labor market with a 12.5% Black labor force, and its records did not show any contacts with minority organizations or hires during a two year period). These deficiencies are somewhat more egregious than those in the instant case. Consequently, the amount assessed in the instant case is lower in proportion to our current forfeiture authority ($250,000) than the amount in the cited cases was to our previous forfeiture authority ($20,000). 18. The record in this case indicates that the licensee recruited for 71 jobs and that minorities were present in only 44 applicant pools and 41 interview pools. In addition, KSBW-TV failed to contact minority sources for 25 (over one-third) of its vacancies. Further, it failed to maintain adequate records for meaningful self-assessment. The licensee provided applicant pool data for only 59 of its 72 vacancies and interview pool information for only 56 of its 72 positions. The licensee hired 15 minorities (nine Hispanics, three American Indians, two Asian/Pacific Islanders, and one Black), all for upper-level category jobs during the review period. As the licensee correctly indicates, absent exigent circumstances, we examine only the reporting years of the current license term. The Salinas MSA included 36.8% minorities from 1989 to 1992 and 44.9% minorities in 1993. 19. We believe that the facts in the instant case are similar to, but more egregious than, those in KESQ. Its location in an extremely significant MSA of 36.8% minorities for the years 1989 to 1992 and 44.9% minorities in 1993 should have prompted KSBW-TV to increase its outreach efforts to include use of minority specific sources whenever vacancies occurred. Also, the licensee did not provide complete applicant and interview pool data. We believe that maintaining such information would better enable the licensee to self-assess the effectiveness of its recruitment efforts. Further, the station experienced a very large hiring cycle during the last three years of the license term, which could have translated into increased numbers of minority applicants. Given the facts of this case, broadcasters' familiarity with our long standing EEO rule, as well as our expanded forfeiture authority in this area, we feel that the circumstances in this case justify issuance of a Notice of Apparent Liability for $15,000. Accordingly, we will grant renewal subject to reporting conditions as set forth below and issue a Notice of Apparent Liability for $15,000. IV. CONCLUSION 20. Upon review of the record and the arguments submitted by all parties, we find no hearings are warranted and that renewal of the license is appropriate. However, we will grant the renewal subject to reporting conditions and issuance of a Notice of Apparent Liability for $15,000. V. ORDERING CLAUSES 21. Accordingly, IT IS ORDERED, that the Petition to Deny filed by the California State Conference of Branches of the NAACP and LULAC against the renewal application of KSBW-TV IS DENIED. 22. IT IS FURTHER ORDERED, that the license renewal application for Station KSBW-TV IS GRANTED subject to reporting conditions specified herein, and pursuant to Section 503, a NOTICE OF APPARENT LIABILITY FOR FORFEITURE in the amount of $15,000. 23. IT IS FURTHER ORDERED that the licensee of KSBW-TV submit to the Commission an original and one copy of the following information on August 1, 1995, August 1, 1996, and August 1, 1997: (a) For each report, please make two lists divided by full- time and part-time vacancies during the 12 months preceding the respective reporting dates, indicating the job title and FCC job category of the position, the race or national origin, sex and the referral source of each applicant for each and the race or national origin and sex of the person hired. These lists should also note which recruitment sources were contacted; (b) A list of employees as of the July 1, 1995, payroll period for the first report, a list of employees as of the July 1, 1996, for the second report, and a list as of the July 1, 1997 payroll period for the third report by job title and FCC job category indicating full-time or part-time status (ranked from highest paid classification), date of hire, sex and race or national origin; (c) Details concerning the station's efforts to recruit minorities for each position filled during the 12-month period specified, including identification of sources used and indicating whether any of the applicants declined actual offers of employment. In addition, the licensee may submit any relevant information with regard to the station's EEO performance and efforts thereunder. 24. IT IS FURTHER ORDERED that the Mass Media Bureau send by Certified Mail - Return Receipt Requested -- one copy of this Memorandum Opinion and Order to all parties. 25. The reports are to be filed with the Acting Secretary of the Commission to the attention of the Mass Media Bureau's EEO Branch. Should the parties have any questions regarding this action, they may telephone the Mass Media Bureau's EEO Branch (202-632-7069). 26. Should the parties have any questions regarding this action, they may telephone the Mass Media Bureau's EEO Branch (202-632- 7069). With respect to the forfeiture proceeding, the licensee may take any of the actions set forth in Section 1.80 of the Commission's Rules, 47 C.F.R.  1.80, as summarized in the attachment to this Order. Any comments concerning the ability to pay should include those financial items set forth in the attachment. FEDERAL COMMUNICATIONS COMMISSION William F. Caton Acting Secretary