*Pages 1--8 from Microsoft Word - 55310.doc* Federal Communications Commission DA 06- 473 Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D. C. 20554 In the Matter of ) ) Broadcast Company of the Americas, LLC ) File Nos 325- NEW- 20050425- 00010 for Section 325( c) of the Act to Permit ) 325- NEW- 20050425- 00011 Delivery of Programming to Station ) XHBCE- FM, Class C1, Municipio de ) Call Sign: XHBCE- FM Tecate, B. C. Mexico and Station XHBCE- FM, ) Class B, Matamoros Jaramillo, B. C. Mexico ) ) and ) ) Quetzal Bilingual Communications, Inc. ) 325- NEW- 20050406- 00008 for Section 325( c) Permit to Deliver ) Programming to Station XHBCE- FM, ) Class C1, Tecate, B. C. Mexico ) ORDER AND AUTHORIZATION Adopted: February 24, 2006 Released: February 24, 2006 By the Chief, Strategic Analysis and Negotiations Division, International Bureau: I. INTRODUCTION 1. In this Order, we grant Broadcast Company of the Americas, LLC’s (BCA) request for authority, under Section 325( c) of the Communications Act, to deliver programming to Class C1 Station XHBCE- FM, Tecate, Baja California, Mexico, for re- broadcast into the United States. We find that the operating parameters of XHBCE- FM are properly coordinated pursuant to the 1992 USA- Mexico FM Broadcasting Agreement and comply with the parameters upon which the United States and Mexico agreed. Grant of this request serves the public interest by allowing unique programming to residents in the San Diego area. In this Order, we also discuss related applications filed by Quetzal Bilingual Communications, Inc. II. BACKGROUND A. BCA’s Applications for 325( c) Authority 2. On April 25, 2005, BCA, a U. S. company, filed two applications for authority under Section 325( c) of the Communications Act to deliver programming from a facility in the United States to the Mexican broadcast station, XHBCE- FM, for the purpose of the programming being re- broadcast and received in the San Diego area. Specifically, BCA seeks authority under Section 325( c) to deliver programming to (1) the Class B facilities of Station XHBCE- FM located in Matamoros Jaramillo, Baja 1 Federal Communications Commission DA 06- 473 2 California 1 and (2) the Class C1 facilities of Station XHBCE- FM located in Cerro Bola, Municipio de Tecate, Baja California. 2 At the time of filing, XHBCE was operating on the Class B facilities and was authorized to construct new Class C1 facilities at a location nearby. 3 BCA planned to use the B facilities in Matamoros Jaramillo until such time as the C1 facility in Tecate was fully constructed. 4 BCA also filed an application for special temporary authority (STA) to provide a single program to the Class C1 facilities while its application remained pending. 5 B. Quetzal’s Application for 325( c) Authority and Related Filings 3. At the time BCA filed its applications, an application from Quetzal Bilingual Communications, Inc. (Quetzal), for a 325( c) permit to deliver programming to XHBCE- FM’s Class B facilities in Matomoros Jarmillo, Baja California, Mexico was pending at the Commission. 6 Lazer Broadcasting Corporation, Emmis Communications Corporation, and Citicasters Licenses, L. P., U. S. licensed radio station operators, filed a Joint Petition to Deny the application. 7 Petitioners assert that several facilities for which Quetzal either holds, or held, Section 325 authority were not operating in accordance with the terms of their authorizations or the coordinations between the United States and Mexican governments. Petitioners also allege that Quetzal’s owner, Mr. Bonilla, “had a record of abuse in terms of using unauthorized Mexican facilities to broadcast programming back into the U. S. under Section 325( c) permits. 8 Quetzal withdrew this application in July 2005. 9 1 See Public Notice, Report No. 325- 00099 and File No. 325- NEW- 20050426- 00011 (BCA Application for B facilities). 2 See Public Notice, Report No. 325- 00098 and File No. 325- NEW- 20050425- 00010 (BCA Application for C1 facilities). 3 BCA Application at Exhibit III. The 1992 USA- Mexico FM Broadcasting Agreement defines the parameters for Class B and Class C1 facilities. For example, a Class B facility has a maximum effective radiated power (ERP) of 50 kilowatts (kW) with an antenna height above average terrain (HAAT) of 150 meters (m), which produces a protected contour extending 65 kilometers (km). The protected contour of a Class B facility is 0. 5 mV/ m (54 dBu). Conversely, a Class C1 facility has a maximum ERP of 100kW with an HAAT of 300m, which produces a protected contour extending 72km. The protected contour of a Class C1 facility is 1.0 mV/ m (60 dBu). 4 BCA C1 Application at Exhibit III. In a letter dated July 29, 2005, BCA indicated that the C1 facility was fully constructed and operational. Letter from John M. Pelky, Counsel for BCA, to Marlene H. Dortch, Secretary, Federal Communications Commission, Counsel’s File No. 21554- 00100- 64. 5 Letter from John M. Pelkey, Counsel for BCA, to Marlene H. Dortch, Secretary, Federal Communications Commission (dated July 1, 2005), File No. 325- STA- 20050701- 00016. Lazer Broadcasting and Emmis Communications filed Petitions to Deny this request. BCA also filed an application for authority under 325( c) to provide programming to AM station XEKTT. This application remains pending. 6 See Public Notice, Report No. 325- 00094 and File No. 325- NEW- 20050406- 00008. 7 Petition to Deny Quetzal Application for Section 325( c) Permit to Deliver Programming to Station XHBCE- FM Class C1, Tecate B. C. Mexico, jointly filed by Lazer Broadcasting, Emmis Corporation and Citicasters Licensees, filed May 16, 2005. The Commission also received requests from Quetzal and the Petitioners for extensions of time to file various responses. Quetzal Bilingual Communications Inc., Motion for Extension of Time (filed May 24, 2005). This request was granted verbally by Linda Armstrong, International Bureau, FCC, May 27, 2005. Lazer Broadcasting Corporation and Emmis Corporation, Motion for Extension of Time (filed June 27, 2005); Broadcast Company of the Americas, LLC, Motion for Leave to File (filed June 30, 2005); Lazer Broadcasting Corporation and Emmis Communications Corporation, Motion for Extension of Time (filed July 14, 2005). We accepted and fully considered all of pleadings filed in connection with the Quetzal applications and STA requests. In any event, all filings related to the Quetzal applications are now moot. 8 Petition to Deny Quetzal Application at 1- 2. 2 Federal Communications Commission DA 06- 473 3 4. On April 1, 2005, while the underlying request for authority was still pending, the International Bureau granted Quetzal an STA to deliver programming to XHBCE- FM’s Class B facilities. 10 Quetzal requested an extension of the STA. 11 Given that there is no longer a request for permanent 325( c) authority and that the Mexican Administration has ordered XHBCE to cease operating from the Class B facility, 12 we find that Quetzal’s request to extend this STA and the objections to these applications and requests moot with respect to this proceeding. C. Petitions to Deny BCA Applications 5. Lazer and Emmis also filed a Petition to Deny both BCA applications. 13 At the time BCA filed its applications, BCA, by contractual agreement, was providing programming to Quetzal for transmission over XEKTT and the Class B facilities of XHBCE- FM. The Petitioners argue that the core concerns related to the BCA applications are the same as those presented in their Petition to Deny the Quetzal Application, “namely misuse of Section 325( c) permits and misrepresentations by FCC licensees who knowingly interconnect with internationally uncoordinated and illegally operating Mexican radio stations.” 14 Petitioners claim that, because of the illegal nature of the operations, XHBCE is causing interference to Station KXRS in Hemet California, which operates on the same frequency as XHBCE (105.7). 15 According to the Petitioners, “as the programming partner of Bonilla and Bonilla’s wife, BCA must be charged with the knowledge that XHBCE- FM has never operated from its authorized Class B site at Matamoros Jaramillo,” 16 and that the STA issued to Quetzal for this site is being used to deliver programs to another unauthorized site (the Class C1 facility). In a subsequent filing, the Petitioners expand their requested remedy to include canceling all section 325( c) permits associated with Stations XESS, XESDD, XEKTT, and XHBCE, regardless of the companies named in such permits and taking punitive actions against BCA and Quetzal in any future requests for license renewal. 17 6. On June 30, 2005 BCA filed an Opposition to the Petition to Deny. BCA asserts that the Petitioners allegations are based upon speculation. 18 BCA also claims that the Petitioners arguments with respect to the Class B facilities are without merit. BCA asserts that it is responsible for providing programming over those stations consistent with Mexican and U. S. law. BCA does not, however, operate 9 Letter from Henry A. Solomon, Counsel for Quetzal Bilingual Communications, Inc., to Marlene Dortch, Secretary, Federal Communications Commission (dated July 25, 2005). Lazer and Emmis assert that despite Quetzal’s withdrawal of the application, as an FCC licensee, Quetzal should be held accountable for the alleged misstatements it has made to date. Reply to BCA Opposition at 1. 10 See Public Notice, Report No. 325- 00088 and File No. 325- STA- 20050401- 00003. 11 Letter from John M. Pelkey, Counsel for BCA, to Marlene H. Dortch, Secretary, Federal Communications Commission dated June 20, 2005. Quetzal filed a supplement to that request dated June 24, 2005. In an Informal Objection (dated June 24, 2005), Lazer and Emmis opposed the extension. 12 Letter from John M. Pelkey, Counsel for BCA, to Marlene H. Dortch, Secretary, Federal Communications Commission (dated September 9, 2005). 13 Petition to Deny BCA Application filed June 15, 2005 (Petition to Deny). With the exception of a new engineering report, Petitioners provided the same evidence to support their position as in the Petition to Deny the Quetzal Application. 14 Petition to Deny BCA Application at 3. 15 Reply to BCA Opposition. 16 Petition to Deny BCA Application at 7. 17 Reply to BCA Opposition at 15. 18 BCA Opposition to Petition to Deny at 1. 3 Federal Communications Commission DA 06- 473 4 the Mexican stations for which it provides programming, rather that is a function of the licensee. 19 With regard to the Class C1 facilities, BCA asserts that it was only after the Petitions were filed that XHBCE completed construction and operation of the Class C1 facility, and that both the construction and operation are consistent with the authorization and the parameters of the Mexican coordination with the United States. 20 Finally, BCA argues that the claims regarding interference from the Class C1 facilities are unfounded. 21 D. BCA Application at the Class B site at Matamoros Jaramillo and Request for Special Temporary Authority 7. On July 1, 2005, BCA also requested an STA to permit it to provide certain programming to the Class C1 facility of XHBCE while its application for underlying authority for a 325( c) permit remained pending. 22 Given that in this Order we grant BCA’s underlying application for a 325( c) permit to deliver programming to XHBCE’s Class C1 facility, we find this request for special temporary authority and related objections moot. In addition, since the Mexican Administration has ordered XHBCE to cease operating from the Class B facilities, we find that BCA’s application for a permit to deliver programming to the Class B facility and the objections to this particular application also moot. III. DISCUSSION 8. To make a determination on the facts of this case, we must examine Sections 325 and 309 of the Communications Act of 1934, which govern the export of domestic programming and the public interest analysis applied. Section 325( c) requires applicants to obtain a permit prior to transmitting electronically program material from the United States to a foreign broadcast station that can be received consistently in the United States. 23 This requirement was intended primarily to address two problems: objectionable programming and harmful interference by foreign stations. 24 9. BCA’s request for a permit under Section 325( c) does not involve any allegation of objectionable programming; the Petitioners do, however, complain that Mexican Station XHBCE is causing interference to a U. S. station. With respect to interference, Congress viewed Section 325 as a way to reduce severe electrical interference that U. S. stations were receiving from Mexican border stations. 25 Section 325 gave the interfering stations an incentive to resolve this problem because they would otherwise be unable to receive the benefit of U. S. programming services. 26 As with domestic broadcast applications in determining whether to grant or deny a Section 325 permit we must consider the 19 BCA Opposition to Petition to Deny at 3. 20 BCA Opposition to Petition to Deny at iii. 21 BCA Opposition to Petition to Deny at iv. 22 File No. 325- STA- 20050701- 00016. On July 11, 2005, Lazer and Emmis objected to this request. 23 47 U. S. C. Section 325( c); see also Section 73. 3545 of the Commission’s rules. 24 S. Rep. No. 319, 73d Cong., 2d Sess. 1934. 25 Remote Control Border Stations: Hearings on H. R. 7800 Before the Committee on Merchant Marine, Radio, and Fisheries, 73d Cong., 2d Sess. (1934). 26 The standard for Section 325 applications is delineated in the North American Free Trade Agreement (“ NAFTA”), North American Free Trade Implementation Act, Pub. L. No. 103- 182, 107 Stat. 2057 (1993). NAFTA is an international treaty designed to eliminate barriers to trade and to promote conditions of fair competition between Canada, Mexico, and the United States. North American Free Trade Agreement, Dec. 17, 1992, U. S. –Can. –Mex., Chap. 1, Art. 102, H. R. Treaty Doc. No. 159, 103d Cong., 1 st Sess. (1993). There is a specific NAFTA provision applicable to the FCC’s handling of foreign programming applications under Section 325. 4 Federal Communications Commission DA 06- 473 5 public interest, convenience, and necessity, of such a grant as provided in Section 309 of the Communications Act. 27 The focus of our discussion is whether BCA is legally and technically qualified to hold a Commission permit to provide programming to XHBCE- FM’s Class C1 facilities for rebroadcast into the United States. We will address each of the issues raised by the petitioners in turn. 10. As an initial matter, the Petitioners assert that BCA should be held accountable for alleged wrongdoing by one of its programming partners, Quetzal. 28 The Petitioners assert that Quetzal has a history of misusing 325( c) permits and BCA as its programming partner should be charged with knowledge of Quetzal’s alleged conduct. 29 Petitioners also raise specific allegations that XHBCE- FM was not operating the B facility in accordance with the terms of its authorization and was not operating at its authorized location for the B facility at Matamoros Jaramillo. However, as previously discussed, the SCT has instructed the licensee of XHBCE FM to terminate operations at the Matamoros Jarmillo location now that the site in Tecate, B. C. is constructed. In addition Quetzal has also withdrawn its application for a 325( c) permit. For these reasons, we do not need to reach the merits regarding the alleged violations against Quetzal and therefore do not need to reach a decision as to whether BCA should have had knowledge of the alleged misrepresentations with respect to this proceeding. In any event, the record does not provide sufficient nexus between Quetzal and BCA to raise concerns about BCA’s knowledge of Quetzal’s alleged misconduct with respect to this proceeding. Moreover, there is no overlap in ownership with Quetzal and Mr. Bonilla. There is nothing in the record of the BCA proceeding that allows us to conclude that the allegations of misrepresentation on the part of Quetzal are grounds for a denial of a permit for BCA. 11. Directional Antenna: Petitioners also assert that the antenna for XHBCE- FM’s Class C1 facility cannot produce the required directional antenna pattern and cannot protect KXRS- FM, located in Hemet, California. Specifically, Petitioners claim that XHBCE- FM’s Class C1 antenna pattern is an incorrect representation of the actual operating facility and that the antenna actually radiates with full-power towards KXRS- FM, which in turn results in interference to a majority of KXRS- FM’s protected 60 dBu service area. 30 Petitioners state that the directional antenna submitted to the Commission does not actually have the directional characteristics it is claimed to have because the Petitioners could not find documentation that demonstrates that the antenna has the parts (parasitic elements) added to it to cause it to be directional. 31 In response, BCA filed a measured directional antenna pattern and the results of a survey indicating that the antenna is pointing at an azimuth of 280°. 32 In reply, Petitioners state that XHBCE- FM’s antenna is so broad that the difference in antenna orientation makes little difference. 33 12. Based on our review of XHBCE- FM’s Class C1 operating parameters, including the directional antenna pattern, supplied to us by Mexico’s Secretaria de Comunicaciones y Transportes (SCT), we find that XHBCE- FM’s facility complies with the limitation to which the United States and Mexico agreed. 34 We also reviewed the operating parameters BCA submitted in the Opposition to the 27 47 U. S. Sections 309( a) and 325( d). 28 Petition to Deny BCA application at 7. 29 Petition to Deny BCA Application at 3 and 7. 30 Petition to Deny BCA at 8. Lazer is the licensee of Station KXRS- FM, 105.7 MHz, Hemet, California. 31 Reply to BCA Opposition at pp 4- 5. 32 BCA Opposition to Petition to Deny at 7 and Attachments 1- 13. 33 Reply to BCA Opposition pp at 4- 5. 34 Letter from Jorge Rodriguez Castaneda, Director General, State Office of Radio and Television Systems, Secretaria de Comunicaciones y Transportes, (SCT) to Kathryn O’Brien, Chief, Strategic Analysis and Negotiations Division, International Bureau, Federal Communications Commission (dated May 8, 2005). 5 Federal Communications Commission DA 06- 473 6 Petition to Deny and reach the same conclusion – that is, the operating parameters, including the measured directional antenna pattern, comply with the limitations mentioned above. In matters such as this, we rely on the responses of SCT, since it has the authority to regulate XHBCE- FM. 35 Thus, we lack evidence to find that XHBCE- FM’s operations are inconsistent with the notified operating parameters in accordance with Article 8.3 of the 1992 USA- Mexico FM Broadcasting Agreement. 36 13. Antenna Size: Petitioners also argue that XHBCE- FM’s Class C1 antenna is too large. Specifically, petitioners claim that XHBCE- FM’s eight bay antenna is “far larger than would be required for the authorized maximum ERP of 8.2 kW.” 37 In response, BCA states that the use of an 8- bay antenna is common, that the 8- bay antenna was purchased because the station was originally authorized to use a higher power, that more bays means less transmitter power output, and that the ability of an antenna to operate with more power does not mean that it will be operated with more power. 38 In their reply, Petitioners state that they have no confidence that XHBCE- FM will operate at 8.2 kW or operate directionally towards KXRS- FM. 39 14. The fact that XHBCE- FM uses an 8- bay antenna does not raise any specific concerns with us. BCA has sufficiently explained why XHBCE- FM is using an antenna that is larger than what would normally be used. 40 However, if we were to find that XHBCE- FM is operating with facilities different from those listed in the SCT’s May 8, 2005 letter, BCA will have to immediately cease program operations. In addition, if is determined that XHBCE- FM’s parameters do not comply with those of its associated allotment, or its protected contour is greater than or extends beyond that of its corresponding allotment the SCT must immediately suspend XHBCE- FM operation in accordance with Section 8.1.1 of the 1992 USA- Mexico FM Broadcasting Agreement. 15. Interference: Finally, Petitioners claim that station XHBCE- FM is causing interference to station KXRS- FM. 41 Specifically, a KXRS- FM sales representative, Mr. Armando Gutierrez, states that he is receiving calls from customers, advertisers and listeners claiming that they are receiving interference to the KXRS- FM signal. The Petitioners claim that the interference is coming from a station in Mexico that operates on the same frequency as KXRS- FM. Mr. Gutierrez states that he has investigated the interference and can confirm “that KXRS’s signal receives interference from the Mexican co- channel station.” 42 BCA states that Mr. Gutierrez fails to provide the call sign of the offending station, declarations from complaining parties, audio tapes of the interference, the source of the alleged interference, or the locations of the alleged interference. 43 35 Letter from Jorge Rodriguez Castaneda, Director General, State Office of Radio and Television Systems, Secretaria de Comunicaciones y Transportes to Kathryn O’Brien, Chief, Strategic Analysis and Negotiations Division, International Bureau, Federal Communications Commission (dated May 8, 2005). 36 We will, however, periodically monitor transmissions to ensure that the transmissions are in accordance with the 1992 USA- Mexico FM Broadcasting Agreement. 37 Petition to Deny BCA Application at 7. 38 BCA Opposition to Petition to Deny at 11. 39 Reply to BCA Opposition at 6. 40 The larger the antenna, the higher the initial cost to build the facility, however, the operating cost will be lower in the long run. 41 Petition to Deny BCA Application at 2. 42 Both Petitioners’ Petition to Deny (Exhibit 1). 43 The Federal Communications Commission requests, in part, the following information when it receives a complaint of interference: a detailed description of the nature of the interference, including the duration and 6 Federal Communications Commission DA 06- 473 7 16. According to BCA, the Petitioner’s claim that the Class C1 facility will cause interference to Station KXRS in Hemet is premised entirely upon a misperception of the orientation of the antenna and the pattern thereof. BCA attached to its pleading a certificate from a licensed surveyor to prove that the directional antenna installed at the C1 site by XHBCE is installed along the correct azimuth. 44 BCA also provided a copy of a range- testing report prepared by the U. S. manufacturer for the XHBCE antenna at the C1 facility. 45 According to that range test, the pattern achieved by the antenna provides the requisite protection mandated by the Commission with respect to Hemet and Ludlow. 46 Finally, BCA argued that the Petitioners’ claim of interference should be disregarded because “they are founded upon a declaration not of an engineer but of a sales representative who vaguely alludes to complaints of interference that he does not even allege stem from operations by XHBCE- FM.” 47 17. The Commission treats allegations of interference to other authorized stations as a serious issue. At this time we are unable to confirm Petitioners’ claims. The record does not support a claim of actual interference. Should the Commission find that XHBCE- FM is causing any unacceptable interference to any lawfully operating U. S. station in the future, BCA will be required to cease operations immediately and we reserve the right to revoke this grant. 18. We find that it is also in the public interest to allow BCA to transmit programming to XHBCE- FM from the Class C1 facility. This will allow consumers in areas of California to view unique programming. IV. CONCLUSION 19. Based on the reasons discussed above, we find that it is in the public interest to grant BCA’s request for authority under Section 325( c) of the Communications Act. BCA is granted a permit to deliver programs to Station XHBCE- FM’s C1 facilities located in Tecate, B. C., Mexico for re-broadcast into the United States. V. ORDERING CLAUSES 20. Accordingly, pursuant to Section 0.261 of the Commission's rules on delegated authority, 47 C. F. R. § 0.261, Broadcast Company of the Americas, LLC’s, request for authority under Section 325( c) to deliver programming to XHBCE’s Class C1 facilities in Tecate, B. C., Mexico, File No. 325- NEW- 20050425- 00010, is GRANTED. 21. IT IS ORDERED that Broadcast Company of the Americas, LLC’s request for authority under Section 325( c) to deliver programming to XHBCE’s Class B facilities in Matamoros Jarmillo, Mexico, File No. 325- NEW- 20050426- 00011, is DISMISSED as moot. 22. IT IS FURTHER ORDERED that Broadcast Company of the Americas, LLC’s request for Special Temporary Authority, File No. 325- STA- 20050701- 00016, to provide the program “El Cucuy Por La Manana” from the Class B facilities of XHBCE- FM is DISMISSED. 23. IT IS FURTHER ORDERED that Quetzal Bilingual Communications, Inc, ’s request to withdraw its application for authority under 325( c) to deliver programming to XHBCE’s Class B facilities, File No. 325 NEW- 20050406- 00008 is GRANTED. frequency of the occurrence of interference; the call sign and address of the station believed to be the source of the interference; and any documentation supporting the alleged existence and cause of the interference. 44 BCA Opposition to Petition to Deny at iii. 45 BCA Opposition to Petition to Deny at iii. 46 BCA Opposition to Petition to Deny at iii. 47 BCA Opposition to Petition to Deny at iv. 7