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                                   Before the

                       Federal Communications Commission

                              Washington, DC 20554

                                                  )   EB-06-IH-5642          
     In the Matter of                                                        
                                                  )   Facility ID No. 36478  
     Lancaster Educational Broadcasting                                      
     Foundation                                   )   NAL/Account No.        
     Licensee of Noncommercial Educational        )                          
     Station WFCO(FM), Lancaster, Ohio                FRN 0003018645         

                                FORFEITURE ORDER

   Adopted: July 8, 2009 Released: July 8, 2009

   By the Chief, Investigations and Hearings Division, Enforcement Bureau:


    1. In this Forfeiture Order, we impose a monetary forfeiture of $6,000
       against Lancaster Educational Broadcasting Foundation ("Lancaster" or
       "Licensee"), licensee of noncommercial educational Station WFCO(FM),
       Lancaster, Ohio, for violating Section 399B of the Communications Act
       of 1934, as amended (the "Act"), and Section 73.503(d) of the
       Commission's rules by broadcasting prohibited advertisements over the

   I. background

   2. This case arises from a complaint made to the Commission alleging that
   noncommercial educational Station WFCO(FM) broadcast prohibited
   underwriting announcements during its broadcast of Capital University
   college football games during the 2006 season. Thereafter, the Bureau
   inquired of the licensee concerning the allegations contained in the
   complaint. Lancaster responded to the LOI on September 14, 2007.

   3. On February 10, 2009, the Bureau issued a Notice of Apparent Liability
   for Forfeiture ("NAL"), finding that the Licensee had apparently violated
   the pertinent statute and Commission rules, and proposing a monetary
   forfeiture of $7,500. On March 20, 2009, Lancaster responded to the NAL,
   stating that the Station has taken remedial actions. Lancaster also urges
   the Commission to cancel or substantially reduce the NAL's proposed
   forfeiture amount asserting that it is unable to pay that amount and that
   the forfeiture amount should reflect its history of compliance with the
   Commission's rules.


   4. The proposed forfeiture amount in this case was assessed in accordance
   with Section 503(b) of the Communications Act, Section 1.80 of the
   Commission's Rules, and the Commission's forfeiture guidelines set forth
   in its Forfeiture Policy Statement. In assessing forfeitures, Section
   503(b) of the Act requires that we take into account the nature,
   circumstances, extent, and gravity of the violation, and with respect to
   the violator, the degree of culpability, any history of prior offenses,
   ability to pay, and other matters as justice may require. As discussed
   further below, we have examined Lancaster's response to the NAL pursuant
   to the aforementioned statutory factors, our rules, and the Forfeiture
   Policy Statement, and find that cancellation or reduction of the
   forfeiture on the basis of inability to pay is not appropriate in this
   case. We find, however, that a reduction is warranted based on Lancaster's
   prior history of compliance with Commission rules.

   5. In its NAL Response, Lancaster does not dispute the NAL's finding that
   the twenty announcements violated the Commission's underwriting rules and
   so we will adopt the NAL's apparent conclusion concerning those
   announcements. Instead, Lancaster claims that due to its strained
   financial condition, it cannot satisfy the forfeiture amount and argues
   that cancellation or reduction is therefore warranted. Lancaster also
   urges the Commission to consider the remedial actions that it undertook
   prior to the initiation of the Bureau's investigation as well as its good
   compliance history as factors supporting forfeiture rescission or

   6. In support of its inability to pay claim, Lancaster has provided
   financial documentation for 2006, 2007, 2008, and part of 2009. Lancaster
   asserts that the proposed forfeiture amount is many times more than its
   net income for the last four years. Lancaster also claims that it had
   losses and low net income during the past four years, and that, if
   required to pay, it will most likely have to cease operations. Lancaster
   requests that we rescind or reduce the forfeiture in the instant case.

   7. The Commission has determined that a licensee's gross revenues are the
   best yardsticks for determining its ability to pay, and that the net-loss
   experience does not, in the absence of other mitigating factors,
   demonstrate a licensee's inability to pay. In its NAL Response, Lancaster
   erroneously compares itself to the licensee in Discussion Radio, Inc. In
   Discussion Radio, the Commission did reduce the forfeiture based on
   inability to pay, but only after first considering the gross revenues of
   the licensee. Although the Commission in Discussion Radio did also
   evaluate the licensee's losses and modest income, the Commission reduced
   the forfeiture because it held that the forfeiture amount either
   approached or exceeded the licensee's gross revenues.

   8. In contrast, in this case, the forfeiture proposed by the NAL does not
   exceed or even approach the gross revenues of Lancaster; it falls well
   within the percentage range that our precedents have found acceptable.
   While Lancaster has also cited its net losses and low net income, the
   Commission has held that "other financial indicators such as net losses,
   may be relevant [but,] [i]f gross revenues are sufficiently great, the
   mere fact that a business is operating at a loss does not by itself mean
   that it cannot afford to pay a forfeiture." In this case, we find that
   Lancaster's gross revenues are sufficient to sustain the forfeiture.

   9. Lancaster also points to its low cash reserves and claims that if it is
   required to pay the forfeiture amount it will "most likely have to cease
   operations." Upon providing proper documentation, however, Lancaster may
   request an installment payment plan option to lessen the immediate impact
   of the forfeiture. For this reason, the full forfeiture amount need not be
   satisfied by existing cash reserves and need not drive the Station out of
   business. We note also that the Commission has considered arguments in the
   past concerning potential cessation of operations, but only where such
   cessation would result in the entire community of license losing broadcast
   service. While the Station's assertion that it might go out of business
   concerns us greatly, our precedent requires that in forfeiture proceedings
   such defenses be evaluated with respect to the public impact of that
   eventuality on the entire composition of broadcasters in the community, in
   this case in Lancaster, Ohio. We note that Lancaster is not the only
   broadcaster serving this community. Finally, based on our precedent, we
   believe the gross revenue information the Licensee provided demonstrates
   that Lancaster has sufficient resources to pay the forfeiture imposed
   without jeopardizing the Station's ability to continue to serve its
   community. Therefore, after considering the entire record, and in light of
   pertinent Commission precedents, we do not find that rescission or
   reduction is appropriate in this case based on inability to pay.

   10. We also do not find Lancaster's post-facto remedial actions to be
   mitigating. We have repeatedly stated that remedial actions taken to
   correct a violation are not mitigating factors warranting forfeiture

   11. Finally, Lancaster asks that we consider reducing the forfeiture based
   on its overall record of compliance with the Commission's rules. We have
   reviewed our records and find no other violations against the Licensee.
   Under similar circumstances, we have reduced proposed forfeitures, and
   find that doing so in this case is appropriate. Consequently, we reduce
   Lancaster's forfeiture amount from $7,500 to $6,000.


   12. ACCORDINGLY, IT IS ORDERED  that, pursuant to Section 503(b) of the
   Communications Act of 1934, as amended (the "Act"), and Section 1.80 of
   the Commission's rules, Lancaster Educational Broadcasting Foundation, IS
   LIABLE FOR A MONETARY FORFEITURE in the amount of $6,000 for willfully and
   repeatedly violating Section 399B of the Act, as amended, and Section
   73.503 (d) of the Commission's Rules.

   13. Payment of the forfeiture shall be made in the manner provided for in
   Section 1.80 of the Rules within thirty (30) days of the release of this
   Forfeiture Order. If the forfeiture is not paid within the period
   specified, the case may be referred to the Department of Justice for
   collection pursuant to Section 504(a) of the Act. Payment of the
   forfeiture must be made by check or similar instrument, payable to the
   order of the Federal Communications Commission. The payment must include
   the NAL/Account No. and FRN No. referenced above. Payment by check or
   money order may be mailed to Federal Communications Commission, P.O. Box
   979088, St. Louis, MO 63197-9000. Payment by overnight mail may be sent to
   U.S. Bank-Government Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza,
   St. Louis, MO 63101. Payment by wire transfer may be made to ABA Number
   021030004, receiving bank TREAS/NYC, and account number 27000001. For
   payment by credit card, an FCC Form 159 (Remittance Advice) must be
   submitted. When completing the FCC Form 159, enter the NAL/Account Number
   in block number 24A (payment type code). Lancaster will also send
   electronic notification on the date said payment is made to,,,
   and Requests for full payment under an
   installment plan should be sent to: Chief Financial Officer -- Financial
   Operations, 445 12th Street, S.W., Room 1-A625, Washington, D.C. 20554.
   Please contact the Financial Operations Group Help Desk at 1-877-480-3201
   or Email: with any questions regarding payment

   14. IT IS FURTHER ORDERED that a copy of this Order shall be sent, by
   Certified Mail/Return Receipt Requested, to Lancaster Educational
   Broadcasting Foundation, 201 South Broad Street, Suite 301, Lancaster,
   Ohio 43140, and by regular mail to its counsel, Coe W. Ramsey, Esq.,
   Brooks, Pierce, McLendon, Humphrey, & Leonard, L.L.P., Wachovia Capitol
   Center, Suite 1600, 150 Fayetteville Street, Post Office Box 1800,
   Raleigh, North Carolina 27602.


   Hillary S. DeNigro

   Chief, Investigations and Hearings Division

   Enforcement Bureau

   See 47 U.S.C. S: 399b.

   See 47 C.F.R. S: 73.503(d).

   See Letters from Complainant to Benigno E. Bartolome, Deputy Chief,
   Investigations and Hearings Division, Enforcement Bureau, dated September
   15, 2006, and March 1, 2007 (collectively the "Complaint").

   See Letter from Benigno E. Bartolome, Deputy Chief, Investigations and
   Hearings Division, Enforcement Bureau, to Lancaster, dated August 20, 2007

   See Letter from Steve Rauch, President, Lancaster Educational Broadcasting
   Foundation, to Benigno E. Bartolome, Deputy Chief, Investigations and
   Hearings Division, Enforcement Bureau, dated September 14, 2007 ("LOI

   See Lancaster Educational Broadcasting Foundation, Notice of Apparent
   Liability for Forfeiture, 24 FCC Rcd 1384 (Enf. Bur., Investigations &
   Hearings Div., 2009) ("NAL").

   See Letter from Coe W. Ramsey, attorney for Lancaster Educational
   Broadcasting Foundation, to Hillary S. DeNigro, Chief, Investigations and
   Hearings Division, Enforcement Bureau, Federal Communications Commission,
   filed March 20, 2009 ("NAL Response").

   See NAL Response at 2-3.

   See 47 U.S.C. S: 503(b).

   See 47 C.F.R. S: 1.80.

   See The Commission's Forfeiture Policy Statement and Amendment of Section
   1.80 of the Rules to Incorporate the Forfeiture Guidelines, Report and
   Order, 12 FCC Rcd 17087 (1997), recons. denied, 15 FCC Rcd 303 (1999)
   ("Forfeiture Policy Statement").

   See 47 U.S.C. S: 503(b)(2)(E).

   See NAL Response at 2-3.

   See id. at 2-4.

   See id. at Attachment C. Lancaster cites to San Jose Navigation, Inc. for
   the types of financial documentation accepted by the Commission to
   establish an inability to pay claim. See San Jose Navigation, Inc.,
   Forfeiture Order, 22 FCC Rcd 1040, 1043 (2007).

   See NAL Response at 3.

   See id.

   See id. at 2.

   PJB Communications of Virginia, Inc. Memorandum Opinion and Order, 7 FCC
   Rcd 2088 (1992) ("PJB Communications").

   See Independent Communications Inc., Memorandum Opinion and Order and
   Forfeiture Order, 14 FCC Rcd 9605, 9610 (1999); PJB Communications, 7 FCC
   Rcd at 2089.

   See NAL Response at 3 citing Discussion Radio, Inc., Memorandum Opinion
   and Order and Forfeiture Order, 24 FCC Rcd 2206 (Media Bureau 2009)
   ("Discussion Radio").

   See Discussion Radio, 24 FCC Rcd at 2207.

   See id. at 2207.

   See NAL, 24 FCC Rcd at 1384 (proposing a forfeiture of $7,500).

   See, e.g., PJB Communications, 7 FCC Rcd at 2089 (forfeiture not deemed
   excessive where it represented approximately 2.02 percent of the
   violator's gross revenues); Local Long Distance, Inc., 16 FCC Rcd 24385,
   24389 (2000), recons. denied, 16 FCC Rcd 10023, 10025 (2001) (forfeiture
   not deemed excessive where it represented approximately 7.9 percent of the
   violator's gross revenues); Hoosier Broadcasting Corporation, 15 FCC Rcd
   8640, 8641 (Enf. Bur. 2002) (forfeiture not deemed excessive where it
   represented approximately 7.6 percent of the violator's gross revenues).
   In this case, the forfeiture represents a percentage within the range of
   PJB Communications of Virginia, Inc., Local Long Distance, Inc., and
   Hoosier Broadcasting Corp.

   PJB Communications, 7 FCC Rcd at 2089.

   See NAL Response at 2.

   See, e.g., First Greenville Corporation, Memorandum Opinion and Order and
   Forfeiture Order, 11 FCC Rcd 7399 (1996).

   Station WHOK-FM, licensed to the Wilks License Company-Columbus, L.L.C.
   and Station WLOH (AM), licensed to WLOH Radio Company, also currently hold
   licenses for Lancaster, Ohio. See Federal Communications Commission, Media
   Bureau, CDBS Public Access available at
   (last visited July 2, 2009).

   See, e.g., Capstar TX Limited Partnership (WKSS(FM)), Notice of Apparent
   Liability, 20 FCC Rcd 10636 (Enf. Bur. 2005) (forfeiture paid); AT&T
   Wireless Services, Inc., Notice of Apparent Liability, 17 FCC Rcd 21866,
   21871 (2002); KVGL, Inc., Memorandum Opinion and Order, 42 FCC Rcd 258,
   259 (1973). While Lancaster's alleged remedial actions may have pre-dated
   the Bureau's investigation, its actions were taken after the Complaint was
   filed. Therefore, we still do not find their remedial actions mitigating.
   See, e.g., Clear Channel Broadcasting Licenses, Inc., Notice of Apparent
   Liability for Forfeiture, 21 FCC Rcd 4072, 4075 (Enf. Bur., Investigations
   & Hearings Div., 2006) (forfeiture paid) (finding that during a
   licensee-conducted contest, where the licensee engaged in remedial actions
   after receiving complaints about the manner in which it conducted the
   drawing for the contest, but prior to Commission investigation, such
   action was not considered mitigating) ("Clear Channel").

   See Clear Channel, 21 FCC Rcd at 4075.

   See NAL Response at 3-4.

   See, e.g., WMGO Broadcasting Corp., Inc., Forfeiture Order, 23 FCC Rcd
   3754 (Enf. Bur., Investigations & Hearings Div., 2008).

   See 47 U.S.C. S: 503(b), 47 C.F.R. S: 1.80.

   See 47 U.S.C. S: 399b; 47 C.F.R. S: 73.503(d).

   See 47 C.F.R. S: 1.80.

   See 47 U.S.C. S: 504(a).

   Federal Communications Commission DA 09-1511



   Federal Communications Commission DA 09-1511