LPFM Frequently Asked Questions: Licensing
Q. Why do we have to wait for a filing window?
A. The filing window serves two primary purposes. First, it allows the FCC to use their limited resources in the most effective way to assure that all radio services are able to get the most attention possible. This allows the FCC to only worry about one type of application filing before moving to something different. Second, it is about fairness. The filing window gives all eligible organizations the ability to file in the window if there are competing applicants, the FCC utilizes a point system to determine which applicants will be granted construction permits.
Q. Do we know who has already filed before we file?
A. No. During a filing window, all applications for new stations are kept confidential at the FCC until after the close of the filing window. Once the filing window closes, all of the applications filed in the window will become public information.
Q. I really want to run a station but it says that individuals can't hold a license. Is there something that can be done?
A. LPFM was intended for existing nonprofit educational organizations, educational institutions, government public safety agencies and tribal entities to obtain a community radio station. While LPFM stations will not be licensed to individuals, a group of individuals can get together and form a corporation with their Secretary of State office. That corporation must, of course, be nonprofit. Some states have a requirement on the minimum number of board members and in some cases, the board members can't be related by family. The organization must be established with the state prior to the filing window. It is also important that the organization has an educational purpose and when applying for a radio station, they must state how the station will advance their organization's educational objectives. Therefore, a statement like "we just want to play music for the community" will not cut it.
Q. So we can't have advertisers?
A. You can't have advertisers, but you can have donors and underwriters. LPFM stations are allowed to acknowledge over the air, donations received from for-profit businesses and can mention the business in a manner that identifies the business but not promote the business. Some stations have faced 5-figure fines for running commercials. If you are thinking that you are going to make a profit from LPFM, LPFM is not the service you want.
Q. Who owns the LPFM station?
A. The station is owned by the nonprofit organization. It is not owned by any individual.
Q. We have heard that an organization must be two years old in order to apply for an LPFM license. Is this correct?
A. As long as the organization is incorporated with the state prior to the filing window, even if it is a few days before the window opens, the organization can apply. Organizations that have a local community presence for a minimum of two years prior to the filing window will have a priority in the point system used for the selection of conflicting (mutually exclusive) applications.
Q. Can an out of state organization apply for an LPFM station?
A. The LPFM service is available only for applicants considered "local". For educational organizations and institutions, an organization must be headquartered, or have a campus or have 75% of the organization's board members reside within 10 miles of the transmitting antenna if the station is in a county designated by ratings company Nielsen Audio as a top-50 market county and within 20 miles from all other areas. Therefore, the organization must have a local presence. As long as the organization is local, they can have their corporation status in any state in order to satisfy the FCC. Some states may require a corporation that is incorporated in a different state to also hold a "foreign corporation" in that state in order to conduct business (i.e. collect donations). Lack of foreign corporation status is not an impediment with the FCC.
Q. Can an LPFM station be sold?
A. The license itself has no value. An LPFM station can be sold for what was paid to construct the station infrastructure. For example, if your organization paid $5,000 for a transmitter, you can be recouped $5,000 for that transmitter. Your organization can also be reimbursed for the costs of construction. The organization can't be compensated for operating costs such as leases, rents, utilities, music licensing, intellectual property, etc. Licensees cannot sell their stations for a profit. Unbuilt construction permits can be given to another organization (with the FCC's permission) after 18 months from the grant of the permit. In some cases, there will be additional restrictions on the "assignment" of a LPFM license in the first 4 years of operation of the LPFM station.