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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
)
HBC License Corporation ) File No. EB-02-SD-157
)
Licensee of Station KHOT-FM ) and
Paradise Valley, Arizona )
) File No. EB-02-SD-158
Licensee of Station KHOV-FM )
Wickenburg, Arizona ) NAL/Acct. No.:
) 200332940001
) FRN: 000-494-6141
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Released:
November 29,
2002
By the District Director, San Diego Office, Enforcement
Bureau:
I. INTRODUCTION
1. In this Notice of Apparent Liability for
Forfeiture ("NAL"), we find that HBC License Corporation
(``HBC''), licensee of FM Broadcast stations KHOT-FM,
Paradise Valley, Arizona and KHOV-FM, Wickenburg, Arizona,
has apparently willfully and repeatedly violated Sections
11.35(a), 11.35(c) and 11.61 of the Commission's Rules by
failing to maintain operational Emergency Alert System
("EAS") encoder and decoder equipment and by failing to
conduct and log required EAS tests.1 We conclude, pursuant
to Section 503(b) of the Communications Act of 1934, as
amended (``Act''),2 that HBC is apparently liable for a
forfeiture in the amount of eight thousand dollars ($8,000).
II. BACKGROUND
2. On May 6, 2002, an Agent from the FCC's San Diego
Office inspected stations KHOT-FM and KHOV-FM at the shared
main studio facility located at 4745 N. 7th St., #140,
Phoenix, Arizona. The inspection revealed that KHOT-FM and
KHOV-FM share common EAS equipment, which at the time of
inspection, appeared to be operational. The Agent noted
that HBC maintained a single, continuous printout of the log
for the EAS equipment for both KHOT-FM and KHOV-FM. This
printout indicated that no EAS tests (sent or received) were
conducted during the period from September 14, 2001 through
April 9, 2002. Further, the printout indicated that the EAS
unit was not operational from September 17, 2001 through
April 8, 2002. There was no written explanation of why the
EAS tests were omitted or any indication that the stations'
chief operator or other personnel attempted to identify the
source of any problem with the EAS equipment.
3. On May 28, 2002, an official Notice of Violation
was issued to HBC for failing to maintain operational EAS
equipment, for failing to receive and transmit tests, and
for failing to conduct weekly checks of the station's
records by the designated chief operator from September 14,
2001 though April 9, 2002.3
4. On June 27, 2002, the FCC's San Diego office
received a reply letter dated June 26, 2002, from HBC. The
letter included a statement from HBC's designated chief
operator dated June 24, 2002. In that statement the chief
operator acknowledged the violations and delineated steps
taken to prevent future EAS rule violations.
III. DISCUSSION
5. Section 503(b) of the Act provides that any person
who willfully or repeatedly fails to comply substantially
with the terms and conditions of any license, or willfully
or repeatedly fails to comply with any of the provisions of
the Act or of any rule, regulation or order issued by the
Commission thereunder, shall be liable for a forfeiture
penalty.4 The term ``willful'' as used in Section 503(b)
has been interpreted to mean simply that the acts or
omissions are committed knowingly, and ``repeated'' means
the commission or omission of the act more than once or for
more than one day.5
6. The Rules provide that every FM Broadcast station
is part of the nationwide EAS network and is categorized as
a participating national EAS source unless the station
affirmatively requests authority to not participate.6 The
EAS provides the President and state and local governments
with the capability to provide immediate and emergency
communications and information to the general public.7
State and local area EAS plans identify sources responsible
for coordinating carriage of common emergency messages from
agencies such as the National Weather Service or local
emergency management officials.8
7. The Rules require FM Broadcast stations to ensure
that EAS equipment, such as encoders, decoders, attention
signal generators and receivers, is installed so that the
monitoring and transmitting functions are available during
the times whenever the station is in operation.9 The Rules
also require FM Broadcast stations to: (a) receive monthly
EAS tests from designated EAS sources and retransmit the
monthly test within 60 minutes of its receipt and (b)
conduct tests of the EAS header and EOM codes at least once
a week at random days and times.10
8. As required by Section 11.61 of the Rules, monthly
EAS tests must be retransmitted within 60 minutes of
receipt, weekly EAS tests be conducted at least once a week
at random times and all EAS tests received and transmitted
must be logged in the station's records. Section 73.1820(a)
of the Rules provides, in part, that entries must be made in
the station log either manually by a person designated by
the licensee who is in actual charge of the transmitting
apparatus or by automatic devices.11 This rule section
further provides that all stations must enter each test and
activation of the EAS pursuant to the requirements of Part
11 of the Rules and the EAS Operating Handbook.12 Stations
may keep EAS data in a special EAS log maintained at a
convenient location; however, this log is considered a part
of the station log.
9. The shared EAS log for KHOT-FM and KHOV-FM indicated
that the EAS equipment was not operational for over 6
months, and that personnel for both stations failed to
conduct or log a single transmitted or received test
(monthly or weekly) from any source from September 14, 2001
through April 9, 2002. The log also revealed that the
designated chief operator did not conduct the weekly review
of the station's log.
10. Based on the evidence, we find that HBC willfully
and repeatedly violated Sections 11.35 and 11.61 of the
Rules by failing to maintain operational EAS equipment and
failing to comply with EAS testing and logging requirements.
The base forfeiture amount set by The Commission's
Forfeiture Policy Statement and Amendment of Section 1.80 of
the Rules to Incorporate the Forfeiture Guidelines,
(``Forfeiture Policy Statement''),13 and Section 1.80 of the
Rules,14 for EAS equipment not installed or operational is
$8,000. In assessing the monetary forfeiture amount, we
must also take into account the statutory factors set forth
in Section 503(b)(2)(D) of the Act, which include the
nature, circumstances, extent, and gravity of the
violation(s), and with respect to the violator, the degree
of culpability, and history of prior offenses, ability to
pay, and other such matters as justice may require. Applying
the Forfeiture Policy Statement and the statutory factors to
the instant case, an $8,000 forfeiture is warranted.
IV. ORDERING CLAUSES
11. Accordingly, IT IS ORDERED THAT, pursuant to
Section 503(b) of the Communications Act of 1934, as
amended,15 and Sections 0.111, 0.311 and 1.80 of the
Commission's Rules, HBC is hereby NOTIFIED of an APPARENT
LIABILITY FOR A FORFEITURE in the amount of eight thousand
dollars ($8000) for violations of Sections 11.35(a),
11.35(c) and 11.61 of the Rules.16
12. IT IS FURTHER ORDERED THAT, pursuant to Section
1.80 of the Commission's Rules, within thirty days of the
release date of this NOTICE OF APPARENT LIABILITY, HBC SHALL
PAY the full amount of the proposed forfeiture or SHALL FILE
a written statement seeking reduction or cancellation of the
proposed forfeiture.
13. Payment of the forfeiture may be made by mailing a
check or similar instrument, payable to the order of the
Federal Communications Commission, to the Forfeiture
Collection Section, Finance Branch, Federal Communications
Commission, P.O. Box 73482, Chicago, Illinois 60673-7482.
The payment must include the FCC Registration Number (FRN)
and the NAL/Acct. No. referenced in the caption.
14. The response, if any, must be mailed to Federal
Communications Commission, Enforcement Bureau, Technical and
Public Safety Division, 445 12th Street, SW, Washington,
D.C. 20554 and must include the NAL/Acct. No. referenced in
the caption.
15. The Commission will not consider reducing or
canceling a forfeiture in response to a claim of inability
to pay unless the petitioner submits: (1) federal tax
returns for the most recent three-year period; (2) financial
statements prepared according to generally accepted
accounting practices (``GAAP''); or (3) some other reliable
and objective documentation that accurately reflects the
petitioner's current financial status. Any claim of
inability to pay must specifically identify the basis for
the claim by reference to the financial documentation
submitted.
16. Requests for payment of the full amount of this
Notice of Apparent Liability under an installment plan
should be sent to: Chief, Revenue and Receivables
Operations Group, 445 12th Street, SW, Washington, D.C.
20554.17
17. Under the Small Business Paperwork Relief Act of
2002, Pub L. No. 107-198, 116 Stat. 729 (June 28, 2002), the
FCC is engaged in a two-year tracking process regarding the
size of entities involved in forfeitures. If you qualify as
a small entity and if you wish to be treated as a small
entity for tracking purposes, please so certify to us within
thirty (30) days of this NAL, either in your response to the
NAL or in a separate filing to be sent to the Federal
Communications Commission, Enforcement Bureau, Technical &
Public Safety Division. Your certification should indicate
whether you, including your parent entity and its
subsidiaries, meet one of the definitions set forth in the
list provided by the FCC's Office of Communications Business
Opportunities (``OCBO'') set forth in Attachment A of this
Notice of Apparent Liability. This information will be used
for tracking purposes only. Your response or failure to
respond to this question will have no effect on your rights
and responsibilities pursuant to Section 503(b) of the Act.
If you have questions regarding any of the information
contained in Attachment A, please contact OCBO at (202) 418-
0990.
18. IT IS FURTHER ORDERED THAT a copy of this NOTICE OF
APPARENT LIABILITY shall be sent by Certified Mail - Return
Receipt Requested, to HBC License Corporation, 3102 Oak Lawn
Ave., Suite 215, Dallas, Texas 75219.
FEDERAL COMMUNICATIONS
COMMISSION
William R. Zears Jr.
District Director, San Diego
Office
Enc: FCC List of Small Entities
Attachment A
October 2002
FCC List of Small Entities
As described below, a ``small entity'' may be a small
organization,
a small governmental jurisdiction, or a small business.
(1) Small Organization
Any not-for-profit enterprise that is independently owned
and operated and
is not dominant in its field.
(2) Small Governmental Jurisdiction
Governments of cities, counties, towns, townships, villages,
school districts, or
special districts, with a population of less than fifty
thousand.
(3) Small Business
Any business concern that is independently owned and
operated and
is not dominant in its field, and meets the pertinent size
criterion described below.
Industry Type Description of Small Business
Size Standards
Cable Services or Systems
Special Size Standard -
Cable Systems Small Cable Company has 400,000
Subscribers Nationwide or Fewer
Cable and Other Program
Distribution $12.5 Million in Annual
Receipts or Less
Open Video Systems
Common Carrier Services and Related Entities
Wireline Carriers and
Service providers
1,500 Employees or Fewer
Local Exchange Carriers,
Competitive Access
Providers, Interexchange
Carriers, Operator Service
Providers, Payphone
Providers, and Resellers
Note: With the exception of Cable Systems, all size
standards are expressed in either millions of dollars or
number of employees and are generally the average annual
receipts or the average employment of a firm. Directions
for calculating average annual receipts and average
employment of a firm can be found in
13 C.F.R. §121.104 and 13 C.F.R. § 121.106, respectively.
International Services
International Broadcast
Stations
$12.5 Million in Annual
Receipts or Less
International Public Fixed
Radio (Public and Control
Stations)
Fixed Satellite
Transmit/Receive Earth
Stations
Fixed Satellite Very Small
Aperture Terminal Systems
Mobile Satellite Earth
Stations
Radio Determination
Satellite Earth Stations
Geostationary Space Stations
Non-Geostationary Space
Stations
Direct Broadcast Satellites
Home Satellite Dish Service
Mass Media Services
Television Services
$12 Million in Annual Receipts
or Less
Low Power Television
Services and Television
Translator Stations
TV Auxiliary, Special
Broadcast and Other Program
Distribution Services
Radio Services
$6 Million in Annual Receipts
or Less
Radio Auxiliary, Special
Broadcast and Other Program
Distribution Services
Multipoint Distribution Auction Special Size Standard -
Service Small Business is less than
$40M in annual gross revenues
for three preceding years
Wireless and Commercial Mobile Services
Cellular Licensees
1,500 Employees or Fewer
220 MHz Radio Service -
Phase I Licensees
220 MHz Radio Service - Auction special size standard -
Phase II Licensees Small Business is average gross
revenues of $15M or less for
the preceding three years
(includes affiliates and
controlling principals)
Very Small Business is average
gross revenues of $3M or less
for the preceding three years
(includes affiliates and
controlling principals)
700 MHZ Guard Band Licensees
Private and Common Carrier
Paging
Broadband Personal
Communications Services 1,500 Employees or Fewer
(Blocks A, B, D, and E)
Broadband Personal Auction special size standard -
Communications Services Small Business is $40M or less
(Block C) in annual gross revenues for
three previous calendar years
Very Small Business is average
gross revenues of $15M or less
for the preceding three
calendar years (includes
affiliates and persons or
entities that hold interest in
such entity and their
affiliates)
Broadband Personal
Communications Services
(Block F)
Narrowband Personal
Communications Services
Rural Radiotelephone Service 1,500 Employees or Fewer
Air-Ground Radiotelephone
Service
800 MHz Specialized Mobile Auction special size standard -
Radio Small Business is $15M or less
average annual gross revenues
for three preceding calendar
years
900 MHz Specialized Mobile
Radio
Private Land Mobile Radio 1,500 Employees or Fewer
Amateur Radio Service N/A
Aviation and Marine Radio
Service 1,500 Employees or Fewer
Fixed Microwave Services
Small Business is 1,500
Public Safety Radio Services employees or less
Small Government Entities has
population of less than 50,000
persons
Wireless Telephony and
Paging and Messaging 1,500 Employees or Fewer
Personal Radio Services N/A
Offshore Radiotelephone 1,500 Employees or Fewer
Service
Wireless Communications Small Business is $40M or less
Services average annual gross revenues
for three preceding years
Very Small Business is average
gross revenues of $15M or less
for the preceding three years
39 GHz Service
Auction special size standard
(1996) -
Multipoint Distribution Small Business is $40M or less
Service average annual gross revenues
for three preceding calendar
years
Prior to Auction -
Small Business has annual
revenue of $12.5M or less
Multichannel Multipoint
Distribution Service $12.5 Million in Annual
Receipts or Less
Instructional Television
Fixed Service
Auction special size standard
(1998) -
Local Multipoint Small Business is $40M or less
Distribution Service average annual gross revenues
for three preceding years
Very Small Business is average
gross revenues of $15M or less
for the preceding three years
First Auction special size
standard (1994) -
Small Business is an entity
that, together with its
affiliates, has no more than a
218-219 MHZ Service $6M net worth and, after
federal income taxes (excluding
carryover losses) has no more
than $2M in annual profits each
year for the previous two years
New Standard -
Small Business is average gross
revenues of $15M or less for
the preceding three years
(includes affiliates and
persons or entities that hold
interest in such entity and
their affiliates)
Very Small Business is average
gross revenues of $3M or less
for the preceding three years
(includes affiliates and
persons or entities that hold
interest in such entity and
their affiliates)
Satellite Master Antenna
Television Systems $12.5 Million in Annual
Receipts or Less
24 GHz - Incumbent Licensees 1,500 Employees or Fewer
24 GHz - Future Licensees Small Business is average gross
revenues of $15M or less for
the preceding three years
(includes affiliates and
persons or entities that hold
interest in such entity and
their affiliates)
Very Small Business is average
gross revenues of $3M or less
for the preceding three years
(includes affiliates and
persons or entities that hold
interest in such entity and
their affiliates)
Miscellaneous
On-Line Information Services $18 Million in Annual Receipts
or Less
Radio and Television
Broadcasting and Wireless
Communications Equipment 750 Employees or Fewer
Manufacturers
Audio and Video Equipment
Manufacturers
Telephone Apparatus
Manufacturers (Except 1,000 Employees or Fewer
Cellular)
Medical Implant Device 500 Employees or Fewer
Manufacturers
Hospitals $29 Million in Annual Receipts
or Less
Nursing Homes $11.5 Million in Annual
Receipts or Less
Hotels and Motels $6 Million in Annual Receipts
or Less
Tower Owners (See Lessee's Type of Business)
_________________________
1 47 C.F.R. §§ 11.35(a), 11.35(c) and 11.61.
2 47 U.S.C. § 503(b).
3 47 C.F.R. §§ 11.35, 11.61(a)(1) & 73.1870(c)(3).
4 47 U.S.C. § 503(b).
5 Section 312(f)(1) of the Act, 47 U.S.C. § 312(f)(1), which
applies to violations for which forfeitures are assessed
under Section 503(b) of the Act, provides that ``[t]he term
`willful', when used with reference to the commission or
omission of any act, means the conscious and deliberate
commission or omission of such act, irrespective of any
intent to violate any provision of this Act or any rule or
regulation of the Commission authorized by this Act....''
See Southern California Broadcasting Co., 6 FCC Rcd 4387
(1991). Section 312(f)(1), which also applies to Section
503(b), provides: ``[t]he term ``repeated'', when used with
reference to the commission or omission of any act, means
the commission or omission of such act more than once or, if
such commission or omission is continuous, for more than one
day.''
6 47 C.F.R. §§ 11.11 & 11.41.
7 47 C.F.R. § 11.1 & 11.21.
8 47 C.F.R. § 11.18. State EAS plans contain guidelines
that must be followed by broadcast and cable personnel,
emergency officials and National Weather Service personnel
to activate the EAS for state and local emergency alerts.
The state plans include the EAS header codes and messages to
be transmitted by the primary state, local and relay EAS
sources.
9 47 C.F.R. § 11.35.
10 47 C.F.R. § 11.61(a)(1)(v). At the time of the
violations, the Rules required monthly EAS tests to be
retransmitted within 15 minutes of receipt of the required
test message. Effective May 16, 2002, the Rules were
modified to require monthly EAS tests to be retransmitted
within 60 minutes of receipt of the required monthly test
message. Amendment of Part 11 of the Commission's Rules
Regarding the Emergency Alert System, EB Docket No. 01-66,
Report and Order, FCC 02-64 (Feb. 26, 2002); 67 Fed Reg
18502 (April 16, 2002).
11 47 C.F.R. § 73.1820(a).
12 47 C.F.R. Part 11.
13 12 FCC Rcd 17087 (1997), recon denied, 15 FCC Rcd 303
(1999).
14 47 C.F.R. § 1.80.
15 47 U.S.C. § 503(b).
16 47 C.F.R. §§ 0.111, 0.311, 1.80, 11.35(a), 11.35(c) and
11.61.
17 See 47 C.F.R. § 1.1914.