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                           Before the
                Federal Communications Commission
                     Washington, D.C. 20554

In the Matter of                 )    File No. EB-02-DV-383
Arnold Broadcasting Company,     )    NAL/Acct. No. 200332800007
Inc.                             )
Station KNEC(FM)                 )    FRN No.  0006-1597-43
Yuma, Colorado

                        FORFEITURE  ORDER

Adopted:  July 27, 2004                 Released:  July 29, 2004

By the Chief, Enforcement Bureau:


     1.        In this Forfeiture Order  (``Order''), we issue  a 
monetary  forfeiture  in  the  amount  of  six  thousand  dollars 
($6,000)  to Arnold Broadcasting  Company, Inc. (``Arnold'')  for 
willful   and  repeated   violation  of   Section  301   of   the 
Communications Act of 1934 (``Act'')1 and Section 11.61(a)(2)  of 
the  Commission's  Rules  (``Rules'').2   The  noted   violations 
involve Arnold's  operating radio transmitting equipment  without 
a  license and failing  to receive and  transmit required  weekly 
tests of the Emergency Alert System (``EAS'').

     2.        On  December  4,  2002,  the  Commission's  Denver 
District Office (``Denver  Office'') issued a Notice of  Apparent 
Liability for Forfeiture (``NAL'') to Arnold for a forfeiture  in 
the amount of  twelve thousand dollars ($12,000).3  Arnold  filed 
a response to the NAL on January 2, 2003.


     3.        On June 13, 2002, a Denver Office agent  inspected 
station  KNEC.   The  agent  determined  that  KNEC  operated  an 
unlicensed studio-to-transmitter  link (``STL'') on 948.0 MHz  at 
KNEC's studio,  205 South Main Street,  Yuma, Colorado.  The  STL 
link  terminated  at KNEC's  transmitter  site  approximately  12 
kilometers  south  of  Yuma,  Colorado.4   The  station   manager 
represented to  the agent that KNEC  began STL operations in  May 
1999.  In addition,  on  the same  day  the Denver  Office  agent 
reviewed KNEC's  station logs and  determined that KNEC  received 
no required weekly EAS test (``RWT'') from the designated LP1  or 
LP2 sources  for the period from May  13, 2002 to June 9,  2002.5  
Further, the Denver  Office agent found that KNEC's station  logs 
revealed that  the station failed to  transmit two required  RWTs 
during the  same time period.  Finally,  the Denver Office  agent 
also  noted that  while KNEC  was monitoring  the designated  LP1 
radio  station  KNNG, it  was  not monitoring  a  designated  LP2 
station.6   Instead, KNEC  was  monitoring the  National  Weather 
Service (``NWS'').  According to the State of Colorado EAS  Plan, 
the NWS is a recommended additional source but not a  replacement 
for the designated local primary station.

     4.        On December 4, 2002,  the Denver Office issued  an 
NAL  to  Arnold   for  twelve  thousand  dollars  ($12,000)   for 
operating an aural broadcast auxiliary station without a  license 
in violation  of Section 301 of  the Communications Act of  1934, 
as amended, and for failing to receive and transmit the  required 
RWTs and RMTs in willful and repeated violation of Section  11.61 
of  the Rules during  the period May  13, 2002 -  June 9,  2002.7  
Arnold  responded to the  NAL conceding that  KNEC failed to  log 
the receipt and broadcast of EAS tests.  Arnold argues that  this 
failure  was ``in no  way attributable  to the fact  that it  was 
monitoring  the [NWS] instead  of one of  the two designated  LP2 
stations.''8  Therefore,  Arnold contends, KNEC's monitoring  the 
NWS  rather than the  LP2 should not  figure into the  forfeiture 

     5.        Arnold submits  that operating  an STL  without  a 
license  should be deemed  a ``much less  serious offense''  than 
operating  a  full-service station  without  a  license.   Arnold 
argues  that  its  operation of  an  unlicensed  STL  posed  ``no 
significant  risk   of  interference  to  other  stations,''   as 
evidenced by Section 74.24 of the Rules, which permits 720  hours 
of  operation  per  year  without  a  license.   Arnold   further 
contends  that this  permission  for unlicensed  operation  ``can 
lead  a licensee into  making the sort  of innocent mistake  that 
Arnold  made, to  wit, believing  that a  license would  be  duly 
issued....''    Arnold  further  stated  that  it  expected   its 
consulting  engineer to submit  its STL application  and that  it 
would receive a  license in due course.  Arnold admitted that  it 
``did not think about the matter again'' until the Denver  Office 
agent's inspection.


     6.        The proposed forfeiture  amount in  this case  was 
assessed in accordance with Section 503(b) of the  Communications 
Act  of  1934,  as  amended,  (``Act''),9  Section  1.80  of  the 
Rules,10  and The  Commission's Forfeiture  Policy Statement  and 
Amendment  of  Section  1.80 of  the  Rules  to  Incorporate  the 
Forfeiture Guidelines,  12 FCC Rcd  17087 (1997), recon.  denied, 
15  FCC Rcd  303  (1999) (``Policy  Statement'').   In  examining 
Arnold's response,  Section 503(b) of the  Act requires that  the 
Commission  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 such other matters as justice may require.11

     7.        Section 301 of the Act mandates that ``[n]o person 
shall  use  or operate  any  apparatus for  the  transmission  of 
energy or communications or signals by radio'' within the  United 
States ``except under and in accordance with this Act and with  a 
license  in that  behalf  granted under  the provisions  of  this 
Act.''12    Section   74.24  of  the  Rules  permits   short-term 
operation  of broadcast  auxiliary  stations subject  to  several 
conditions, including the  requirement that such operation is  on 
a  secondary,  non-interference  basis  to  regularly  authorized 
stations  and shall  be discontinued  immediately if  perceptible 
interference is caused to a regularly authorized station.13   The 
short-term  operations may  not  exceed 720  hours  annually  per 
frequency. 14 

     8.        Arnold does not claim  that its STL operation  did 
not exceed 720 hours annually during its two years of  unlicensed 
operation.   Indeed,  Arnold  appears to  concede  that  it  made 
greater than  720 hours annual use  of the station without  first 
determining whether  or not it had  a license.  Arnold relied  on 
an independent contractor to file an application for the  station 
and  expected that  a  license would  be  issued in  due  course.  
Arnold admits  that it ``did not  think about the matter  again'' 
until the Denver  Office agent's inspection.  Arnold argues  that 
its  failure to follow  up with  its contractor  was an  innocent 
mistake.   We find  this  argument to  be without  merit.   ``The 
Commission  has long  held that  licensees and  other  Commission 
regulatees are  responsible for the acts  and omissions of  their 
employees  and  independent  contractors  and  has   consistently 
refused  to  excuse licensees  from  forfeiture  penalties  where 
actions of employees or independent contractors have resulted  in 

     9.        Likewise, we find that Arnold's argument that  its 
operations  posed no  significant  risk to  other stations  is  a 
fundamental   misunderstanding   of   the   Communications    Act 
requirement   of   a  license   prior   to   broadcasting   radio 
transmissions.   It  is  well  established  that  enforcement  of 
Section  301 of  the  Act does  not depend  on the  existence  of 
interference caused by the unauthorized operations.16

     10.       Arnold also appears to  rely upon the  flexibility 
of Section  74.24 of the Rules  to mitigate Arnold's own  failure 
to  ensure it  had a  license: ``In  view of  the fact  that  STL 
stations can  be placed in operation and  operated for up to  720 
hours  per year  without a is  unreasonable to  the 
extent of  being arbitrary and capricious  for the Commission  to 
assess  the same forfeiture  for operating  a [sic]  `unlicensed' 
STL  station  that it  would  for operating  an  unlicensed  full 
service  station.''17   We  agree  that the  proposed  forfeiture 
here  was excessive  under the  circumstances.  The  unauthorized 
operation in  this case is not a  violation on the same order  as 
is construction and  operation with no color of authority.18   In 
this case,  Section 74.24 of the Rules  gave Arnold the color  of 
authority to begin  operations, although Arnold had no  authority 
to  continue operations  past the  specified 720  hours for  more 
than two  years.   Accordingly, we impose  a forfeiture for  this 
violation of four thousand dollars ($4,000), the base amount  for 
using  an unauthorized frequency,  rather than  the ten  thousand 
dollars ($10,000) proposed in the NAL. 

     11.       Section 11.61(a)(2) of  the Rules requires  weekly 
tests  of the  EAS  header codes  and  End of  Message  (``EOM'') 
codes.  At the time of the inspection on June 13, 2002,  Arnold's 
records  showed that it  failed to receive  RWTs between May  13, 
2002  and June  9, 2002.   In addition,  Arnold's records  showed 
that  it failed to  transmit RWTs  during the  same time  period.  
Arnold  does not dispute  that it failed  to conduct RWTs  during 
this  time  period.   Accordingly,  without  regard  to  Arnold's 
monitoring  of the NWS,  we conclude that  a two thousand  dollar 
($2,000) forfeiture is appropriate for this violation.

     12.       We have  examined  Arnold's response  to  the  NAL 
pursuant to the statutory factors above, and in conjunction  with 
the  Policy Statement as  well.  As  a result of  our review,  we 
conclude  that Arnold willfully  and repeatedly violated  Section 
301 of the Communications Act of 1934, as amended,19 and  Section 
11.61(a)(2) of the Rules, but we find that the forfeiture  should 
be reduced to $6,000 for these violations.  


     13.       Accordingly,  IT  IS  ORDERED  that,  pursuant  to 
Section  503(b)  of  the  Act,  and  Sections  0.111,  0.311  and 
1.80(f)(4) of the  Rules,20 Arnold Broadcasting Company, Inc.  IS 
LIABLE FOR  A MONETARY FORFEITURE in  the amount of six  thousand 
dollars ($6,000) for its violation of Section 301 of the Act  and 
Section 11.61(a)(2) of the Rules.  

     14.       Payment of  the forfeiture  shall be  made in  the 
manner provided for  in Section 1.80 of the Rules within 30  days 
of  the release of  this 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.21  Payment may be made by mailing a check or  similar 
instrument, payable  to the order  of the Federal  Communications 
Commission,  to the Federal  Communications Commission, P.O.  Box 
73482,   Chicago,  Illinois  60673-7482.    The  payment   should 
reference  NAL/Acct.  No.  200332800007  and  FRN   0006-1597-43.   
Requests  for full payment  under an installment  plan should  be 
sent to: Chief,  Revenue and Receivables Group, 445 12th  Street, 
S.W., Washington, D.C. 20554.22    

     15.       IT IS FURTHER  ORDERED that a  copy of this  Order 
shall be  sent by First Class  and Certified Mail Return  Receipt 
Requested  to Arnold Broadcasting  Company, Inc.,  P.O. Box  830, 
Sterling, Colorado  80751, and to  its counsel, David  Tillotson, 
Esq.,  Law Office of  David Tillotson,  4606 Charleston  Terrace, 
N.W., Washington DC 20007-1911.

                              FEDERAL COMMUNICATIONS COMMISSION

                              David H. Solomon
                              Chief, Enforcement Bureau

1 47 U.S.C.  301.  
2 47 C.F.R.  11.61(a).  
3 Notice of Apparent Liability for Forfeiture, File No. EB-02-DV-
383, NAL/Acct. No. 200332800007 (released December 4, 2002).     
4  The  Commission's  records  indicate  that  Arnold  filed   an 
application for the STL on 948.0 MHz on July 16, 2002, one  month 
after the agents inspected the station.  The license was  granted 
on October 23, 2002, with an assigned call sign of WPWD551.
5  The station logs also  reflected that it received no  required 
monthly EAS test (``RMT'').   However, we note  that the RMT  for 
that time period was cancelled. 
6  The designated LP2 stations for KNEC are KATR(FM) or KRDZ(AM).
7  NAL at  1, 8.
8  Arnold's Response at page 2.
9  47 U.S.C.  503(b).
10  47 C.F.R.  1.80.
11  47 U.S.C.  503(b)(2)(D).
12  47 U.S.C.  301.
13  47.C.F.R.  74.24(c).
14  47 C.F.R.  74.24(d).
15  Eure Family Limited Partnership,  17 FCC Rcd 21861,  21863-64 
(2002)  (internal  quotation  marks  omitted)  and  cases   cited 
16  Stephen Paul Dunifer, 11 FCC Rcd 718, 726 (1995). 
17  Arnold's Response, pages 3-4.
18  See, e.g.,  WWC License  LLC Licensee  of Microwave  Stations 
WPJE660, WPJD256 and  WPJA761, Kansas, 16  FCC Rcd 19490  (2001); 
New York Radio Service, WPTM988, Brooklyn, New York, --- FCC  Rcd 
----, DA 04-1720 (rel. June 18, 2004).
19  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,' 
... 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 ....''  Southern  California Broadcasting Co., 6  FCC 
Rcd 4387 (1991). As  provided by 47  U.S.C.  312(f)(2),  ``[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.'' The  Conference  Report  for  Section 
312(f)(2)  indicates  that  Congress   intended  to  apply   this 
definition to Section 503 of the Act as well as Section 312.  See 
H.R. Rep. 97th  Cong. 2d  Sess. 51  (1982).  Southern  California 
Broadcasting Co., supra.  
20 47 C.F.R.  0.111, 0.311, 1.80(f)(4).
21 47 U.S.C.  504(a).
22 See 47 C.F.R.  1.1914.