Federal Communications Commission FCC 90D-40

5 FCC Red No. 20 Federal Communications Commission FCC 90D-40

claim a comparative advantage on the basis of its pro Before the posed coverage. Joint Stipulation Regarding Areas and Federal Communications Commission Populations to be Served, May 2.2, 1989; Tr. 22. Washington, D.C. 20554 3. A prehearing conference was held on December 15, 1988 and the hearing was scheduled to commence on May 22, 1989. At the May 22 hearing session, the parties announced they were close to a settlement and expected MM Docket No. 88-468 to file a settlement agreement within the week (Tr. 30-31). The exhibits of the parties were received without objec In re Applications of tions, cross examination was waived, and the record was closed (Tr. 32-37). Dates were set for the filing of pro SANDERS File No. BPH-870729MB posed and reply findings with the expectation that the BROADCASTING procedural schedule would be mooted by the expected settlement agreement. However, the parties were unable COMPANY to resolve their differences and a settlement agreement LIMITED was not filed. PARTNERSHIP 4. Greater Greenwood Broadcasting Limited Partner ship (Greater) and Sanders Broadcasting Company Limit GREATER File No. BPH-870729ME ed Partnership (Sanders) fiied proposed findings of fact GREENWOOD and conclusions of law and replies thereto on July 24, BROADCASTING 1989 and August 9, 1989, respectively. Notwithstanding the parties waiving of cross examination and their not LIMITED objecting to each other's exhibits, the findings submitted PARTNERSHIP by the parties challenged the bona fides of the respective applications, opposed the award of integration credit, and For a Construction Permit for a sought diversification demerits. At a conference held on New FM Station on Channel 294A February 1, 1990, the Presiding Judge ruled, absent a in Greenwood, Indiana settlement, that cross-examination of the principals would be required. The record was reopened and a hearing date of February 26. 1990 was established (Tr. 40-51). See also, Appearances Order, FCC 90M-277, released February 14, 1990. David Honig, on behalf of Sanders Broadcasting Com 5. Hearing sessions were held from February 2.6 to 28, pany Limited Partnership; Stephen Diaz Gavin, Paul 1990. With the consent of the parties, the proposed find Perrone, Thomas L. Siebert, Paul C. Besozzi. and J. Jeffrey ings previously filed by Greater and Sanders were dis Craven, on behalf of Greater Greenwood Broadcasting missed (Tr. 260). A new set of findings and conclusions Limited Partnership; and Robert Zauner, on behalf of the was filed on May 24, 1990: replies thereto were filed on Chief, Mass Media Bureau. June 6, 1990. The record was finally reclosed by Memo randum Opinion and Order. FCC 90M-1480 released June 5, 1990. INITIAL DECISION OF ADMINISTRATIVE lAW JUDGE JOSEPH CHACHKIN FINDINGS OF FACT Issued: September 14, 1990 Released: September 25, 1990 SANDERS BROADCASTING COMPANY LIMITED PARTNERSHIP PRELIMINARY STATEMENT BACKGROUND 1. The Mass Media Bureau designated the above-cap tioned applications for comparative hearing by Hearing Designation Order, (HDO), DA 88-1410, released Septem 6. Sanders is a State of Indiana limited partnership ber 23, 1988. 1 The Hearing Designation Order specified the (Greater Ex. ll, p.l; Greater Ex. 13, p. 1). Kerry Sanders following issues for hearing: is the sole general partner and owns 25% of the equity interest of Sanders (Sanders Ex. 1, p. 1). His current address is 4000 N. tv1r;ridian Street, Indianapolis, IN 46205 1. To determine which of the proposals would, on a (Id.; Tr. 75). comparative basis, best serve the public interest. 7. The current and only limited partner of Sanders is 2. To determine, in light of the evidence adduced the A.H.A.B. Family Trust. 916 Oak Avenue, Scranton. pursuant to the foregoing issues, which of the ap Pennsylvania 18508 (Sanders Ex. 1, p. 1). Mr. Guyon plications should be granted, if any. Turner is the Trustee of the Trust. ld. The Trust holds 75% equity interest in the partnership. ld. 2. The designation order permitted the adduction of 8. The original limited partner of Sanders was comparative coverage evidence under the standard com-· MediaComm NationaL Inc. (Greater Ex. 1 L p. 7; Greater parative issues. The parties, have, however. stipulated that Ex. 13, p. 1). Ragan A. Henry is President of MediaComm the differences in area and population to be served are (Greater Ex. 12, p. 1-4; Tr. 217). At the time of the filing insignificant and that neither of the applicants would of the Sanders application. Mr. Henry was the President and 100% shareholder of MediaComm (Tr. 145, 217).

5671 FCC 90D-40 Federal Communications Commission Record 5 FCC Red No. 20

MediaComm assigned its limited partnership interest to work could have been in the context of Mr. Henry's AHAB on May 25, 1988 (Greater Ex. 15, p. 1). The involvement in the National Black Media Coalition, assignment became effective on May 31, 1988. !d. which in turn had Mr. Honig work for it (Tr. 230). Also, 9. Sanders' present limited partner, AHAB, is an irrev Mr. Henry had spoken in the spring of 1987 to Mr. Honig ocable trust created by Mr. Henry for the benefit of his about several clients who wanted to file applications for children, Vincent A., Joseph A., Richard A., and Leah A. Docket 80-90 allocations and needed financial support Henry, and his stepson, Ralph A. Brower (Sanders Ex. 5, (Tr. 227). Mr. Henry had agreed to help Mr. Honig's p. 1). The trust was established on April 21, 1988. !d., p. clients, provided they were "good people" (Tr. 228). 8. The original assets of AHAB included limited partner 16. After calling Mr. Sanders back, Mr. Honig first ship interests in various FM radio applications, including provided Mr. Sanders with some information about Mr. Sanders, plus $8,000.00. ld., p. 9. Mr. Henry created the Henry, and then "patched" Mr. Henry on to the tele trust because his investment banker and lenders had ob phone conversation (Tr. 83). Mr. Sanders knew of Mr. jected to the limited partnership investments, the bankers Henry by reputation but had never met him (Tr. 84). feeling that the limited partnerships diverted Mr. Henry's 17. During the first conversation, Mr. Sanders told Mr. attention from his primary broadcast investments (Tr. Henry about himself, they talked about the Green 261). wood/Indianapolis market, and about how the limited 10. Mr. Sanders first learned of the availability of the partnership would be structured (Tr. 231). Although Mr. Greenwood station in May or June 1987, shortly after he Sanders testified that he had not yet decided on the or moved to Indianapolis (Tr. 77). Sanders moved there in ganizational structure of the application, (Tr. 87), options March 1987 (Tr. 77). He first learned about the availabil including a limited partnership were discussed (Tr. 87). ity from Pippi Riggins, Chairman of the Indianapolis Either in that conversation or in a subsequent conversa Black Media Coalition, whom he knew when they were tion on July 26, 1987, Mr. Henry agreed to proceed with both students at Howard University, Washington, D.C. the application (Tr. 85, 88-89, 232). Mr. Sanders certified (Tr. 76-77). the application two days later, on July 28, 1987 (Tr. 175). 11. Ms. Riggins told him about the station, provided 18. During the July 26 conversation, Mr. Sanders and him an FCC guidebook for the processing of an FM Mr. Henry verbally agreed to form a limited partnership application, and told him about David Honig, Sanders' (Tr. 89, 93). Among other things, it was verbally agreed counsel (Tr. 77-78). Mr. Sanders then contacted Mr. that equity distribution would be split with Mr. Henry Honig on Ms. Pippi's recommendation (Tr. 78-79). receiving 75% and Mr. Sanders 25%. Further, Mr. Henry 12. During their first conversation, Mr. Sanders told would provide funds in the form of a loan to the partner Mr. Honig about his interest in acquiring a station and ship to cover the costs of construction and initial opera Mr. Honig provided Sanders background on doing so (Tr. tion. Also, Mr. Henry would provide funds for the 79). Mr. Honig also discussed FCC procedures and basic prosecution of the application (Tr. 212-215). The qualifications issues (Tr. 80). Their conversation, which understandings reached by Mr. Sanders and Mr. Henry occurred in May or June 1987, lasted approximately 1 was reduced to writing and are contained in a letter dated hour 20 minutes (Tr. 80-81). At that time, Mr. Sanders August 4, 1987 (Greater Ex. 8, p. 2). decided that he would not purchase an existing station but 19. Mr. Henry is a partner in the law firm of Wolf, would pursue an application for a new station (Tr. 80-81). Block, Schorr and Solis-Cohen (Tr. 234). Mr. Henry did Mr. Sanders did not pursue the purchase of an existing not personally draft the limited partnership agreement station because it was too costly (Tr. 81). (Tr. 238). It was drafted by one of Mr. Henry's assistants 13. Sanders realized that he needed an investor, to assist who forwarded it to Mr. Sanders by letter dated August him financially and he contacted various people, includ 21, 1987 (Greater Ex. 9, p. 1; Tr. 101-102, 238). Accord ing Gene D'Angelo, an owner of radio and television ing to Mr. Henry, the agreement was an evolution of his stations in Columbus, Ohio and Indianapolis (Tr. 81-82). law firm's form documents (Tr. 233-234). Mr. Honig did However, these efforts were unsuccessful (Tr. 82). Ap not have a form limited partnership agreement and asked proximately 10-12 days after their first conversation, Mr. Mr. Henry to provide one (Tr. 232-233). Someone at Mr. Sanders contacted Mr. Honig again to advise him of Sand Henry's firm prepared what ultimately became the Sand ers' need for an additional investor (Tr. 82). Mr. Honig ers Agreement (Tr. 238). His office prepared similar limit told Mr. Sanders that some other people might be inter ed partnership agreements for other applicants in which ested (Tr. 82). This call occurred in July 1987 (Tr. 82). MediaComm was a limited partner (Tr. 238). Mr. Henry 14. Within about 4 days time, Mr. Honig contacted Mr. confirmed this when shown a copy of the limited partner Henry and then called Mr. Sanders back (Tr. 83).2 Mr. ship agreement of Novella Broadcasting Co., L.P., another Henry recalled that Mr. Honig called him at home and partnership in which MediaComm was the limited part arranged for a conference call the following day among ner (Tr. 239-240). Messrs. Sanders, Honig and Henry (Tr. 231). 20. Mr. Sanders reviewed the August 21st draft, made 15. Mr. Henry had first learned about the Greenwood changes and had an Indiana attorney review the draft and FM station from Mr. Honig (Tr. 227). Kerry Sanders was forward it to Mr. Henry (Tr. 104). Although Mr. Sanders not the first prospective applicant who Mr. Honig had could not recall what provisions in the August 21st draft discussed with Mr. Henry (Tr. 228). However, Mr. Sand were changed, (Tr. 122-123). Mr. Henry explained that ers was the only person to whom Mr. Henry spoke with the second draft. sent on September 9, 1987. contained Honig about Greenwood (Tr. 229). Mr. Honig is not Mr. provisions also included in a document entitled "Amend Henry's personal attorney (Tr. 229). The law firm of ment to Limited Partnership Agreement," (Greater Ex. Arent Fox Kitner Plotkin & Kahn does most of Mr. 14, pp. 1-2: Tr. 247-248). Mr. Sanders signed the Agree Henry's FCC work (Tr. 229). However, Mr. Honig had ment sometime in early September 1987 (Tr. 129). represented Mr. Henry on some matters (Tr. 230). The

5672 5 FCC Red No. 20 Federal Communications Commission Record FCC 90D-40

21. Mr. Henry's September 9th letter stated that Mr. would draft a letter and send it to Mr. Henry, who would Henry assumed that the limited partnership had already send money (Tr. 170). After AHAB became the limited been formed and requested a copy of the certificate of partner, Mr. Sanders directed capital calls to Mr. Turner, limited partnership (Greater Ex. 10, p. 1). However, Mr. AHAB's Trustee (Tr. 171). The funds for those calls came Sanders was unsuccessful as of September 9, 1987, in from Mr. Henry (Tr. 172), either in the form of advances filing such a certificate (Tr. 107). or loans by Mr. Henry (Tr. 255). He has also guaranteed 22. Mr. Sanders executed the Sanders Certificate of loans by his bank to the Trust. Id. Limited Partnership on September 21, 1987, both on his own behalf and as attorney-in-fact for MediaComm (Greater Ex. 11, p. 6). Kerry Sanders signed as attorney DIVERSIFICATION in-fact pursuant to a power of attorney recorded as instru 28. Neither Sanders nor Kerry Sanders, its General ment number 87-136516 filed in the Marion County Partner, hold any interest in any medium of mass com Recorder's Office. (Id.; Tr. 112). munications (Sanders Ex. 2, p. 1). 23. Sanders' Limited Partnership Agreement (Greater 29. However, as of October 7, 1987, which was the last Ex. 13) has always contained provisions preventing the date for filing Amendments of of right, HDO supra, at limited partner from acting as an employee of the part para. 3, and which is the last date for improvement of an nership, serving in any material capacity as an indepen applicant's comparative position, see generally, 47 C.F.R. dent contractor or agent of the partnership, Section 73.3522, MediaComm's Mr. Henry had the fol communicating regularly with the general partner on lowing attributable media interests. matters pertaining to the day to day operations of the 30. Mr. Henry was an officer, director and 72.33% partnership's business; voting on the removal of the gen voting shareholder of the sole corporate general partner of eral partner; performing any services for the partnership Communications Management National, L.P., licensee of except making loans or acting as a surety for the partner Stations WXTR(FM), La Plata. Maryland, WWIN(AM), ship, or being actively involved in the management or Baltimore, Maryland, and WGHT(FM), Glen Burnie, operation of the media businesses of the partnership. The Maryland (Joint Ex. 2, p. 1). He was also the general Agreement also provides that the general partner may partner of the MediaComm II, Limited Partnership, li veto any admissions of additional general partners ad censee of Station WWER(FM), Newnan, Georgia, and an mitted by any vote of the limited partners. Id. at 22 ~~ officer, director and shareholder of Ragh, Inc., licensee of 7.03 and 7.04. Station KDIA(AM), Oakland, California. Id. 24. The record shows that those provisions have been 31. Mr. Henry is also an officer, director and observed. Ragan Henry's only involvement, other than shareholder of Ragan Henry Broadcast Group, Inc. (Joint providing financing, was that his law firm's form partner Ex. 2, p. 5; Greater Ex. 18. p. 10). Ragan Henry Broadcast ship agreement was used, at the request of Sanders' coun Group is the sole general partner of Ragan Henry Com sel (Tr. 102, 232-233, 238). Other than their discussions munications Group, L.P. (RHCG), Communications Man attendant to formation of the partnership and the transfer agement National, L.P. (CMN), and Ragan Henry of MediaComm's interest to the Trust, Henry's only dis National Radio. L.P. (National Radio). ld. cussion with Sanders was a brief phone call pertaining to 32. As of March L 1990, RHCG was the licensee of a possible settlement of the case (Tr. 138. 140). Similarly. Station WMXB(FM), Richmond, Virginia, WDINWHRK. Kerry Sanders did not communicate with Guyon Turner Memphis, Tennessee, and Station WXLE(FM), Johnstown, except concerning capital calls and possible settlement of Ohio (Greater Ex. 18, pp. 10-11). CMN is licensee of the case (Tr. 174-175). Station WXTR(FM), Waldorf, Maryland and Stations 25. Sanders hired the applicant's consulting engineer, WWIN/WWIN(FM), Glen Burnie, Maryland. Id. National Leachman & Johnson, on the recommendation of Mr. Radio is licensee of Station WKSG(FM), Mount Clemens, Honig (Tr. 86). Mr. Honig prepared the application in Michigan. Id. final form (Tr. 176). As for information regarding Mr. 33. As of March 1, 1990, Mr. Henry was also an officer, Henry in the application, Mr. Sanders deferred to Mr. director and shareholder of Rash, Inc .. licensee of Station Honig (Tr. 177). In estimating costs of station construc KDIA(AM), Oakland, California, VINRAH of New Jersey, tion and operation. Mr. Sanders checked with people Inc .. licensee of Stations WCMC!WZXL(FM), Wildwood, familiar with the construction of a radio station to obtain New Jersey and Tavastock. Inc., licensee of Station cost estimates (Tr. 179). He also used the FCC Guidebook KIDZ(AM), Independence. Missouri (Joint Ex. 2. p. 5; (Tr. 179). Sanders obtained these estimates prior to the Greater Ex. 18. pp. 10-11). July 26th conference call (Tr. 180). 34. As of March 1. 1990. Mr. Henry was also an officer, 26. Sanders paid $3,000 in cash for his 25% ownership director and stockholder of the sole general partner of US interest (Tr. 159-161 ). He used his own personal funds for Radio L.P .. licensee of Station WQQK-FM. South Boston, this capital contribution (Tr. 167). In all, Sanders has Virginia, Station KJOJ(FM). Conroe. Texas. Station made capital contributions of $4.111 (Sanders Ex. 20). In WBSK(AM). Portsmouth. Virginia. Station WOWI(FM). addition, Sanders has advanced several thousands dollars Norfolk. Virginia, and Stations WAKR(FM) and WONE in out-of-pocket expenses which are not reimbursable un FM, Akron. Ohio (Joint Ex. 2. p. 6; Greater Ex. 18, ll). til after grant of the application (Tr. 161-162). 35. Vincent A. Henry. son of Ragan Henry and a 27. MediaComm paid an initial capital contribution of beneficiary of the AHAB Trust. is the President and 100% $9,000 (Tr. 253-254). Mr. Henry could not recall the total shareholder of Broad Based Communications. Inc. (Broad amount contributed by MediaComm between July 1987 Based) (Greater Ex. 8. p. 3). As of March 1. 1990, Broad and May 1988 (Tr. 254). Up until May 31. 1988. when Based is licensee of Stations WWSD(AM) and WIQI(FM), MediaComm was still a limited partner, Mr. Sanders Quincy, Florida (Joint Ex. 2. p. 4). Broad Based is also would make a capital call by telephoning Mr. Honig, who the proposed assignee of Stations KEBE(AM) and KOOI- would advise him of expenses (Tr. 170). Mr. Sanders

5673 FCC 90D-40 Federal Communications Commission Record 5 FCC Red No. 20

FM, Jacksonville, Texas; KYEA(FM), West Monroe, Lou July, 1988 to Present Chairman, Youth Affairs ISlana; and KDAE(AM)/KLTG(FM), Sinton/Corpus Committee, Indiana Black Christi, Texas (Joint Ex. 2, p. 4). Republican Council, Indianapolis chapter. Member of the chapter INTEGRATION since October, 1987. Service area and 36. Kerry Sanders, the General Partner of Sanders, pro membership include poses to work at the station as General Manager on a Greenwood, IN. full-time basis (at least 40 hours per week) (Sanders Ex. 3, p. 1). In that position, Mr. Sanders will ultimately be June, 1988 to June, 1989 Member of the Board of responsible for all management, administrative, budgetary, Directors, Common Cause and programming decisions relating to the operation of and membership include the station. ld. Greenwood, IN. 37. Mr. Sanders is employed full-time as a Business Development Specialist with the Indiana Department of May, 1988 - Present Vice Precinct Commerce. He has held that position since March, 1987. Committeeman, Marion County Republican Central ld. In the event Sanders is awarded the construction Committee. Member of the permit for Channel 294A in Greenwood, Mr. Sanders will Central Committee since resign his position with the Indiana Department of Com July, 1987. merce in order to work full-time at the proposed station. ld. If Mr. Sanders is employed full-time in any other February to November 1988 Member of the Executive position at such time as Sanders might be awarded the Steering Committee, Young construction permit, he will resign such position. Id. Leaders for Mutz 38. Mr. Sanders holds a B.B.A. Degree in Finance from (gubernatorial Howard University (minor in banking), earned in 1978. candidate). He has also earned a J.D. degree from the Ohio State University College of Law (earned in 1984) (Sanders Ex. October, 1987 to Present Member of the Board of 3, p. 1). Directors, Indianapolis Black Media Coalition. 39. Mr. Sanders has also held the following positions: Service area includes March, 1987 - Present: Business Development Specialist, Greenwood, although no Indiana Department of Commerce, Indianapolis, Indiana. members currently reside (Provides financial, management, technical and business there. assistance to established and prospective small, minority and women owned businesses statewide). ld. January, October, 1987 to Present Member, Indianapolis 1986 - March, 1987: Business Consultant, K.C. Sanders Urban League. Service Co., Ft. Wayne, Indiana. (Provided financial, manage area and membership ment, and technical assistance to existing and start-up include Greenwood, IN. businesses). ld. March- December, 1985: Account Execu tive, Money Concepts Financial Planning Center, Colum October, 1987 to Present Member, Indianapolis bus, Ohio. (Provided counseling in the areas of Branch of the NAACP. investments, tax planning, retirement and estate planning, Service area and insurance and wealth accumulation). ld. April, 1983 - membership include Greenwood, IN. March, 1984: Law Clerk, Department of Insurance, State of Ohio, Columbus, Ohio (Part-time position). ld. (Sanders Ex. 3, p. 4; Tr. 72-74). 40. Mr. Sanders, who is Black, currently resides at 4000 North Meridian Street, Indianapolis, IN. (Tr. 70-71). His 42. Mr. Sanders has held employment positiOns in the residence is located within the 70 dB U contour of Sand telecommunication industry (Sanders Ex. 3, p. 2). How ers' proposed station (Sanders Ex. 3, p. 1). Greenwood is ever, he has not claimed any work in a broadcast station. approximately 11 miles from Indianapolis (Tr. 305). Sand ers moved to Indianapolis in March 1987 (Tr. 77). 3 He proposes to move to Greenwood if Sanders' application is AUXILIARY POWER granted (Sanders Ex. 3, p. 1). 43. Sanders proposes to install auxiliary generators at 41. Mr. Sanders has been involved in the following the studio and transmitter sites in order to supply power community, civic and charitable organizations: in the event of a power failure (Sanders Ex. 4, p. 1).

September, 1988 to Present District Committee GREATER GREENWOOD BROADCASTING LIMITED Member, Boy Scouts of America - Explorer PARTNERSHIP Division, Indianapolis. 44. Greater is a State of Indiana limited partnership Service area and (Greater Ex. 1, p.1; Ex. 6, pp. 2, 4). Mary C. Hotopp is membership include the sole general partner and owns 20% of the partnership Greenwood, IN. interests of Greater (Greater Ex. 1, p. 1). The limited partner of Greater is B. Scott Reardon, III (Greater Ex. 1, August, 1988 to Present Deputy Registrar, Marion p. 1; Greater Ex. 6, p. 19). Mr. Reardon owns 80% County, IN. partnership interest in Greater. ld.

5674 5 FCC Red No. 20 Federal Communications Commission Record FCC 900-40

45. Section 4.1 of Greater's Agreement of Limited Part 649). The Agreement is similar in form to a previous nership (the Agreement) provides that the General Part partnership in which Mr. Reardon was a limited partner, ner shall be solely responsible for the management of NJT Limited Partnership (Sanders Ex. 16 pp. 1-21; Tr. Greater's business (Greater Ex. 6, p. 7). Section 2.3 of the 502-503). Agreement specifically prohibits the Limited Partner from 54. Mr. Reardon was interested in forming a limited having any role in the management of the radio station. partnership because he resides in Sioux Falls, South Da Id., p. 6. kota, had a primary interest in operating a cellular tele 46. Section 4.6 of the Agreement, as amended, states phone system, and did not want to relocate to Greenwood that no limited partner shall: (Tr. 480). 55. Mr. Reardon suggested the equity ownership di a. Perform any services to the Limited Partnership vision of 20% for Mrs. Hotopp and 80% for himself (Tr. materially related to its radio station; 440, 622). However, it was decided that she would only have to provide 15% of the funds necessary to prosecute b. Become actively involved in the management or the application and construct the station because she was operation of the Partnership's radio station; putting in her time and would be giving up her employ c. Be an employee of the Partnership's radio station; ment to operate the station (Tr. 440). d. Perform any services as an independent contrac 56. Mrs. Hotopp first heard of the availability of the tor or agent with respect to the Partnership's radio Greenwood FM channel at a Johnson County Bar Associ station; and ation luncheon (Tr. 355). ·However, her first direct com munication about the station was a telephone call from e. Communicate with the General Partner on mat Mr. Reardon, who telephoned her in July 1987 to discuss ters pertaining to the day-to-day operations of its what he characterized as an opportunity (Tr. 355, 479). business. When Mr. Reardon told Mrs. Hotopp that a Greenwood channel was being made available, it piqued her interest (Greater Ex. 5, pp. 9, 23-24). because of what she had previously overheard at the Bar 4 7. Section 7.5 of the Agreement expressly prohibits the Association meeting (Tr. 355). General Partner from transferring more than 49% of her 57. Mr. Reardon had first learned about the Greenwood General Partner interests (Greater Ex. 6, p. 16). availability from Thomas L. Siebert, a Washington, D.C. 48. Section 8.4 of the Agreement provides that the communications attorney (Tr. 643-645). Mr. Siebert pro General Partner can be removed for cause only upon a vided Mr. Reardon information about FM allocations and finding by an independent arbibrator that the General windows (Tr. 662). They had generally discussed the Partner engaged in malfeasance, criminal conduct or wan Docket 80-90 allocations (Tr. 661). Mr. Siebert offered to ton or willful negligence (Greater Ex. 6, p. 17). advise Mr. Reardon of the opening of FM windows (Tr. 49. Greater's General Partner, Mrs. Hotopp, contri 662). Mr. Reardon indicated to Mr. Siebert the markets in buted by check the sum of $1,500 as her initial capital which Reardon had an interest to file (Tr. 62-63). contribution in exchange for her 20% interest (Greater 58. They discussed the Greenwood frequency approxi Ex. 6, p. 22, Tr. 387). This constitutes 15% of the original mately 1 1/2 to 2 months before Mr. Reardon contacted paid-in capital of the Partnership. Mrs. Hotopp and Mr. Mrs. Hotopp (Tr. 643-644). Mr. Siebert sent him informa Reardon have agreed that they will contribute capital tion about the Greenwood frequency and recommended towards the expenses of the Partnership at a ratio of 15% that it might be preferable as an opportunity rather than to 85% and have continued to contribute on this ratio the Indianapolis Docket 80-90 allotment because it would (Tr. 439, 462, 613). attract fewer applications (Tr. 643-645). 50. Mr. Reardon. Greater's Limited Partner, contributed 59. Mr. Siebert had been Mr. Reardon's attornev when by check the sum of $8,500 as his initial capital contribu Reardon filed an application in 1981 for a H~ysville, tion in exchange for his 80% interest (Greater Ex. 6, pp. Kansas FM station (Tr. 475). Mr. Siebert had ceased re 2, 22; Tr. 387). This constitutes 85% of the original presenting the station in 1985 (Tr. 476). paid-in capital of the Partnership. 60. Mr. Siebert is not an investor in any enterprise with 51. Section 7 of the Certificate of Limited Partnership Mr. Reardon (Tr. 552-553). He did not represent Mr. provides that the Limited Partner agrees to make addi Reardon's wife in connection with her own FCC applica tional contributions "when necessary and in the same tion in the RKO proceeding (Tr. 553). proportion as the initial capital contribution bears to the 61. Mr. Siebert had advised Mr. Reardon to find a entire initial investment of all partners" (Greater Ex. 6, p. minority resident of Greenwood as a possible partner 2). (Sanders Ex. 8, p. 2: Tr. 363-364). 52. Mrs. Hotopp has made additional expenditures on 62. Mr. Reardon has been the limited partner in var behalf of Greater (Tr. 437). These have come from per ious FM broadcast applicants (Sanders Ex. 9, pp. 6-7; Tr. sonal funds (Tr. 437-438). She does not have a joint 4 76). Mr. Siebert has represented those applications be account with her husband (Tr. 437). As of the hearing fore the Commission (Tr. 476). 4 date, Mrs. Hotopp had expended approximately $13,000 63. When Mr. Reardon telephoned Mrs. Hotopp, he towards the prosecution of the application (Tr. 439). Mr. told her that he had gone to the Chamber of Commerce Reardon had contributed approximately $75,000 (Tr. and several banks, and that her name had come up re 439). peatedly as someone to contact (Tr. 356, 617). Mr. 53. Mr. Reardon first suggested the formation of a Reardon asked that if she had an interest in running a limited partnership for Greater (Tr. 425, 479). Either he business like a Greenwood radio station, they schedule a or Thomas Siebert, counsel for Greater, provided the draft meeting (Tr. 479). He was in Greenwood specifically to of the document that became the Agreement (Tr. 499,

5675 FCC 90D-40 Federal Communications Commission Record 5 FCC Red No. 20 determine if there was a way that he could put together with Reardon. Mrs. Hotopp believed that she and an application partnership to apply and obtain the Green Reardon had a common interest from the time they ex wood FM license (Tr. 480). ecuted the partnership interest. Also, if a conflict devel 64. Mr. Reardon had earlier discussions with various oped at a later date, she was free to select another people before he went to Greenwood concerning a possi attorney (Tr. 376). · ble general partner (Tr. 481). He contacted John 72. Mrs. Hotopp wanted an attorney competent in FCC O'Connor, an Indianapolis attorney and college classmate matters (Tr. 376). In her mind, she retained Mr. Siebert of Mr. Reardon's father (Tr. 481, 646). Mr. Reardon told after their first telephone conversation (Tr. 379). She had Mr. O'Connor that he was looking for somebody earlier contacted her cousin, a Washington, D.C. lawyer attractive in the eyes of the Commission, someone with who owned 7 or 8 radio stations, but he told her that he management skills, but who had a pattern of fairness in did not practice FCC work (Tr. 379). Her cousin advised his or her business dealings (Tr. 482). He specifically told that Mrs. Hotopp retain an FCC lawyer (Tr. 379). Mr. O'Connor that the FCC preferred minorities and 73. Mrs. Hotopp called Mr. Siebert and felt comfortable females, as well as residents of the community of license with him (Tr. 379). They spoke for about 1 112 hours (Tr. who are active in their communities (Tr. 482). 453). They discussed in great detail what needed to be 65. Mr. O'Connor told Mr. Reardon that he was not done, as well as the impending filing deadline (Tr. 453). familiar with Greenwood, but recommended that Reardon Mrs. Hotopp told Mr. Siebert that she wanted to proceed call one Robert Elrod to learn about Greenwood (Tr. 483, (Tr. 453). 646). Mr. Reardon telephoned Elrod, a Greenwood ac 74. Mrs. Hotopp and Mr. Reardon met face-to-face countant, who suggested that Mr. Reardon contact four or again on July 23, 1987 (Tr. 386). She had decided to five people, including Mrs. Hotopp (Tr. 483-484). Mr. proceed after her telephone conversation with Mr. Siebert Reardon contacted perhaps three people, including Mrs. (Tr. 386). She had also discussed the matter with her Hotopp (Tr. 484). husband (Tr. 386). 66. The first telephone conversation between Mr. 75. Satellite Systems Engineering, Inc. was Greater's Reardon and Mrs. Hotopp lasted approximately 5-10 min consulting engineering firm (Tr. 378). Mrs. Hotopp au utes (Tr. 356). They met the following day in Mrs. thorized Mr. Siebert to contact SSE on July 21 or 22, Hotopp's office (Tr. 356). 1987 (Tr. 378). She herself contacted Rusty Irvin of SSE 67. Their first meeting occurred on July 21, 1987 (Tr. several days later, on July 24 or 25, 1987, to see how 360). It lasted several hours (Tr. 487). During the first things had progressed (Tr. 378, 382, 455). meeting, Mr. Reardon told Mrs. Hotopp more about the 76. Mr. Reardon never discussed SSE with Mr. Siebert FCC licensing process and made clear that his interest (Tr. 664). Nor did he ever direct Rusty Irvin or SSE to do was only in being a financial backer (Tr. 357).5 During any work in connection with the Greenwood application the meeting, Mr. Reardon explained to Mrs. Hotopp the (Tr. 643). Greater paid for SSE's services (Tr. 385). FCC's policies regarding female and minority ownership, 77. Stanley J. Karas provided Mrs. Hotopp with an local ownership and full-time integration (Tr. 365). Mrs. estimate of costs to construct and operate Greater's FM Hotopp had never before considered filing an application station for three months without revenues (Greater Ex. 8, or owning a radio station (Tr. 366-367). She was inter p. 1; Tr. 390, 395). 6 She did not rely on Mr: Reardon for ested in a business opportunity in Greenwood (Tr. 357). the cost estimate underlying Greater's financial certifica 68. Mrs. Hotopp was skeptical about Mr. Reardon's tion (Tr. 421-422). Mr. Siebert had given Mrs. Hotopp the proposal and requested references that she could contact name of Mr. Karas (Tr. 391). She authorized Mr. Siebert (Tr. 357). Mr. Reardon provided her with references, to contact Mr. Karas on her behalf (Tr. 396). She tele some of whom Mrs. Hotopp telephoned, including a Mr. phoned Mr. Karas several days after Mr. Siebert recom Dick Westhoff. a South Dakota C.P.A. (Sanders Ex. 8, p. mended him (Tr. 390, 655). Mr. Karas provided Mrs. 1; Tr. 362, 653). Mr. Siebert was another reference (Sand Hotopp with a verbal estimate of construction and oper ers Ex. 8, p. 1). She also telephoned him (Tr. 362). Mr. ations costs (Tr. 390). Siebert had not already been retained by Mr. Reardon in 78. By letter dated July 27, 1982, Mr. Karas sent her a connection with Greenwood (Tr. 362). written cost estimate (Sanders Ex. 11, p. 1). The study was 69. Mrs. Hotopp knew that Mr. Reardon intended to be directed to her, not Mr. Reardon (ld. ; Tr. 395). The letter a partner in other applications (Tr. 375). This was con indicates that Mr. Siebert received a copy, but nobody else firmed by the July 23, 1987, financial commitment letter (Sanders Ex. 11, p. 1). The study included a detailed cost from Citibank (South Dakota), N.A., which references estimate, including such items as staff, tower construction other applications in which Mr. Reardon might be in costs, antenna costs. etc (Tr. 391). volved as a limited partner (Sanders Ex. 12, p. 1; Tr. 375, 79. Mr. Reardon played no role in preparing the Karas 434). cost estimate (Tr. 420). Mr. Reardon did not speak to Mr. 70. Mrs. Hotopp called Mr. Siebert on July 21 and 22, Karas nor did Mr. Reardon ever request anybody to speak 1987, to check out Mr. Reardon (Tr. 367. 379, 453). At to Mr. Karas about the filing of a Greenwood application that time, she was aware that there was a professional (Tr. 557). He never spoke to anybody about such a cost relationship of sorts between Messrs. Siebert and Reardon, study for Greenwood before he met with Mrs. Hotopp but did not really care (Tr. 368). She also knew of some (Tr. 591). In this connection, in their July 21st meeting, social relationship, but did not know about other applica Mrs. Hotopp and Mr. Reardon had discussed generally a tions in which Mr. Reardon was a partner. which applica breakdown of the costs of prosecuting the Greater applica tions were represented by Mr. Siebert (Tr. 369). tion (Tr. 4.21 ). 71. Mrs. Hotopp did not consider Mr. Siebert's 80. A financial commitment letter from Citibank representation of Greater to be a conflict of interest not (South Dakota). N.A., dated July 23, 1987. and addressed withstanding his disclosure of a past business relationship to Mr. Reardon. (Sanders Ex. 12). together with a hand-

5676 5 FCC Red No. 20 Federal Communications Commission Record FCC 90D-40 written letter from Mr. Reardon to Mrs. Hotopp of the 89. Mr. Reardon does not have any ownership interest same date (Sanders Ex. 13), provided her assurance of his in any radio, television or other broadcast station (Greater ability to meet his financial commitments (Tr. 404, 406, Ex. 2A, p. 1). Similarly, Mr. Reardon does not have any 423, 432). ownership interest in any daily newspaper, magazine, ca 81. In his July 23rd letter to Mrs. Hotopp, Mr. Reardon ble television system, Multipoint Distribution Service Sys committed himself to provide funds towards the construc tem or Multi-channel Multipoint Distribution Service tion and operation of the Greenwood FM station (Sanders System. Id. Ex. 12, pp. 2-3). Citibank's letter is still a valid commit 90. At the time of the filing of the Greater application, ment (Tr. 627). The Bank has not withdrawn it (Tr. 628). Mr. Reardon had a 50% ownership interest in Sedgwick Mrs. Hotopp had personal knowledge of her own assets Broadcasting Co. (Sedgwick), licensee of radio station sufficient to confirm her ability to meet the 15% of the KXLK(FM), Haysville, KS (Greater Ex. 2A, p. 1). Mr. funds necessary to prosecute the application and construct Reardon sold his 50% interest in Sedgwick in April 1988. the station, for which share she was responsible (Tr. Id. 8 443-444). 82. Mrs. Hotopp called Mr. Irvin about the transmitter site (Tr. 455). She knew the owners, Arlene and Lowell INTEGRATION Sutton, and went to speak to them (Tr. 455-456). She 91. Mrs. Hotopp is the sole integrated principal of went with the Suttons to look at the site (Tr. 456). Greater (Greater Ex. 3, p. 1). Mrs. Hotopp will devote full 83. Mrs. Hotopp was also involved in obtaining Great time, a minimum of 40 hours per week, to the position of er's second transmitter site (Tr. 455-457). She went to General Manager of Greater's Greenwood FM station. Id. meet with the owner and obtained his signature on a 92. As General Manager of the Greenwood FM station, reasonable assurance form (Tr. 456). Mrs. Hotopp will have the primary and ultimate respon 84. She worked with Mr. Siebert to prepare the applica sibility for all decisions affecting the station's day-to-day tion (Tr. 471). They reviewed the application form by and long-range operation (Greater Ex. 3, p. 1). Her spe telephone (Tr. 471). She obtained the necessary informa cific responsibilities in this regard will include oversight tion for the EEO statement and personally wrote Great of the station's compliance with all Commission rules and er's program service statement, and then sent that policies; oversight of program production; purchase of information to Mr. Siebert (Tr. 471-472). He then re equipment, services and programming; developing station turned the completed application to her for her signature news and editorial policies; and otherwise directing the on July 28, 1987, along with the Karas study and the operation of the Greenwood FM station. Id. As General complete engineering report (Tr. 472). Manager, Mrs. Hotopp will also hire and supervise all 85. Mr. Reardon's involvement in the preparation of station management personnel (Greater Ex. 3, p. 1). She the application consisted of providing Mrs. Hotopp with will also be responsible for administration and implemen his July 23rd commitment letter (Sanders Ex. 13), as well tation of the station's Equal Employment Opportunity as the Citibank letter, (Sanders Ex. 12). He is aware of no Program. Id. other role that he played (Tr. 650). 93. Mrs. Hotopp is currently employed at Ticor Title 86. Since the filing of the application, Mrs. Hotopp and Insurance Co (Ticor) in its Indianapolis office as Title Mr. Reardon have spoken maybe 5 or 6 times (Tr. 444, Operations Manager and Staff Attorney (Tr. 327). She has 449). 7 Their meeting before the hearing was their first worked there for 4 years as of the hearing (Tr. 327). Mrs. since July 1987 (Tr. 444). They have had several discus Hotopp has no written employment agreement with Ticor sions related to settlement of the proceeding (Tr. 602, (Tr. 328). She has informed Ticor of her integration 604). Bills, including those for legal services, are sent to pledge (Tr. 332). Upon grant of Greater's application, Mrs. Hotopp (Tr. 444). She then calls or writes to notify Mrs. Hotopp will terminate her employment at Ticor him of his 85% share of the bills (Tr. 444). (Greater Ex. 3, p. 2; Tr. 322, 343). 87. Mrs. Hotopp established and maintains Greater's 94. Mrs. Hotopp also has a part-time legal practice in public inspection file (Greater Ex. 3, p. 2). She was which she is self-employed (Tr. 328). On average, she has personally involved in obtaining both Greater's original worked 5-6 hours per week on this legal work, evenings and presently proposed transmitter sites (Id, Tr. 455-456). and weekends (Tr. 338-339). The most that she has She has made all decisions related to the hiring of legal worked in any given week is 10 hours (Tr. 338). She will counsel and an engineering consultant (Greater Ex. 3, p. terminate her legal practice upon grant of the Greater 2; Tr. 378-379, 382). application (Tr. 339). 95. Her practice consists of wills and real estate work (Tr. 329). She has no ongoing clients (Tr. 329). She has DIVERSIFICATION no litigation clients, which would constitute a conflict of 88. Neither Greater nor Mary Hotopp, its General Part interest with her work for Ticor (Tr. 330). Although she ner, hold any interest in any medium of mass commu has retained no copy of her disclosure form, she has nications (Greater Ex. 2A, p. 1). Neither has any interest reported her legal practice income to Ticor on annual in any radio, television or other broadcast facility. Id. disclosure forms (Tr. 330-332). She has earned approxi Similarly, neither Greater nor Mrs. Hotopp have any mately $2,000 from her legal practice during the last two ownership interest in any daily newspaper, magazine, ca years (Tr. 354). ble television system, Multipoint Distribution Service Sys 96. It was her understanding from the beginning of the tem or Multi-Channel Multipoint Distribution Service application process that the station would be her full System. Id. time, only occupation (Tr. 336). She had previously owned a real estate business in Greenwood and has always been involved in Greenwood (Tr. 337). She wanted to

5677 FCC 90D-40 Federal Communications Commission Record 5 FCC Red No. 20

involve herself in a Greenwood business, not full-time 40 e. Citizens for Bless Committee. As Co-Chairman of hours a week, but 60, 80 hours; whatever it took (Tr. this committee, Mrs. Hotopp helped the campaign 337). of Bill Bless, who led the ticket for Greenwood City 97. Section 2.2 of the Limited Partnership Agreement Council in 1988 (Greater Ex. 4, p. 5). provides that Mrs Hotopp, the General Partner, will in f. Greenwood Celebration '88. Mrs. Hotoff worked volve herself in station management on a full-time basis, with her husband, Bob Hotopp, who served as Co within the meaning of the rules and policies of the Com Chairman, for the 1988 July 4th celebration in mission (Greater Ex. 6, p. 5). Greenwood. She was responsible for involving the 98. Mrs. Hotopp is currently a resident of Greenwood, area merchants in a large side-walk sale and craft IN. (Greater Ex. 1, p. 1; Ex. 4, p. 1). She has resided show, along with a walk-a-thon and fire works dis there since 1972 or 1973 (Greater Ex. 3, p. 2; Tr. 458). play (Greater Ex. 4, p. 5). She lived in Indianapolis from her birth in 1942 until she moved to Greenwood in 1972 (Tr. 458). During her 1 1/2 102. Greater has not claimed broadcast experience en years in Texas with her husband, who was in the military hancement credit. service, she maintained her legal residence in Greenwood, Indiana. !d. 99. In 1964, Mrs. Hotopp began working toward her AUXILIARY POWER undergraduate degree at Indiana Central College (Greater 103. Greater will install an auxiliary power supply at Ex. 4, p. 1). She graduated Magna Cum Laude in 1974 both its transmitter and studio location (Greater Ex. 5, p. with a B.S. degree in Business Administration. !d. In 1980 1). Mrs. Hotopp entered school at Indiana University (Great er Ex. 4, p. 1). Five years later, she obtained an M.B.A. and J.D. from Indiana University (Greater Ex. 4, pp. 1, CONCLUSIONS 2). 104. Greater and Sanders suffer no diversification 100. Following graduation from Indiana University, demerit. Greater and Sanders and their respective general Mrs. Hotoff served as Deputy Attorney General in the partners have no media interests. The limited partners of Indiana Office of Attorney General. In 1986, Mrs. Hotoff Greater and Sanders have media interests. However, the joined the Ticor Title Insurance Company, Inc., the na record makes clear that the respective limited partners, tion's largest title insurance company, as a Commercial Scott Reardon and Ragan Henry, have not been involved Title Officer. In 1987 she was promoted to Assistant Vice in any material respect in the prosecution of the applica President and Associate Title Counsel. She was subse tions and are essentially passive investors. Further, Great quently promoted to her current position as Manager of er and Sanders' limited partnership agreements assure that Title Operations/Staff Attorney (Greater Ex. 4, pp. 2-3). the general partners are properly insulated from any pos 101. Mrs. Hotopp has been involved in the following sibility of control or influence by the limited partners. See activities (Greater Ex. 4, p. 4): Ownership Attribution Standards, 55 RR 2d 1465 (1984), recon., 58 RR 2d 604, 615-620 (1985). Also, Daytona a. Greenwood Republican Women's Association. As Broadcasting Co., Inc., 60 RR 2d 1199, 1202 (1986) incor an active member of this group, in 1979-1980, Mrs. porating the insulation standards into the diversification Hotoff served as a Membership Chairman and cam analysis for comparative purposes. Therefore, the media paigned for numerous candidates, including her for interests of Greater's and Sanders' limited partners have mer husband who served as Johnson County not been factored into the diversification analysis. Surveyor. She has been a member since 1975 105. Greater and Sanders seek and receive 100% quan (Greater Ex. 4, p. 4). titative integration credit. Mr. Sanders and Mrs. Hotopp both propose to work full-time as general manager and b. Johnson County Heart Association. As Treasurer the record leaves no doubt that both will fully adhere to in 1981 and 1982, Mrs. Hotopp helped raise and their integration proposals. Integration credit is due, as in account for thousands of dollars for Greenwood and this case, when the applicants have set forth a specific other Johnson County citizens (Greater Ex. 4, p. 4). integration proposal; they have adhered to that proposal; c. Central Nine Vocational School, Director. This and there is reasonable assurance the plan will be carried Johnson County facility, just south of Greenwood, out. See Bradley, Hand & Triplett, 89 FCC 2d 657, 662 trains students from nine county schools. As a Di (Rev. Bd. 1982); Pacific Television. Ltd., 3 FCC Red. 1700 rector during the mid-1970's, Mrs. Hotopp was ac (1987). tively involved in the construction of three houses 106. Moreover, the record persuasively establishes that which were built in Greenwood by the students the partnerships are bona fide. The limited partners have (Greater Ex. 4, p. 4). played a passive role from the outset and will continue to d. Greenwood Citizens for Progress in Government. do so if either of the applications are granted. In this As Secretary of this bi-partisan organization, Mrs. connection, the record demonstrates that Mr. Reardon Hotopp helped direct the successful re-election cam played no role in the preparation of Greater's application paign of the current Greenwood Mayor, Jeannette other than initially contacting Mrs. Hotopp and providing Surina (a Democrat) and five of the eight City financial backing. Mrs. Hotopp has been responsible for Councilmen (four Republicans). She also served as the preparation and prosecution of Greater's application. one of three members of the selection and campaign The record is devoid of even any communications be direction committee. She has belonged to this group tween Mr. Reardon and Mrs. Hotopp after the filing of since 1987 (Greater Ex. 4, p. 5). the application except as relates to settlement and capital contributions. Similarly, Mr. Henry's only involvement

5678 5 FCC Red No. 20 Federal Communications Commission Record FCC 90D-40 has been to provide financial backing to Sanders and to FOOTNOTES send a partnership agreement form to Sanders' counsel at 1 The HDO designated three other applicants for hearing. such counsel's request. The fact that the filing of Sanders' They were subsequently dismissed. By Order, 88M-4290, released partnership agreement with the Indiana Secretary of State December 16, 1988, the Presiding Judge dismissed with preju was delayed does not provide a basis for discrediting or dice the application of Julia M. Carson, for failure to prosecute diminishing Sanders' otherwise valid integration proposal. her application. By Memorandum Opinion and Order, FCC See Victory Media, 3 FCC Red 2073, 2074 (1988); Coast 89M-1062, released April 4, 1989, the Presiding Judge dismissed TV, 5 FCC Red 2751 (1990). Like Mrs. Hotopp, Mr. with prejudice the application of Heartland Radio Limited Sanders has been responsible for the preparation and Partneship for failure to prosecute. By Memorandum Opinion prosecution of Sanders' application. Also, Mr. Henry's and Order, FCC 89M-2116, released August 21, 1989, the Presid communications with Mr. Sanders other than their dis ing Judge dismissed the application of Metro Broadcasters d/b/a cussions attendant to the formation of the partnership and Greenwood Media, pursuant to a Settlement Agreement with the transfer of MediaComms's interest to the AHAB Trust Sanders and Greater. was a brief phone call pertaining to a possible settlement 2 Mr. Henry testified that the first call on this subject oc of the case. Additionally, Mr. Sanders did not commu curred sometime between late May 1987 and July 1987. nicate with Guyon Turner, the trustee of the Trust, except 3 concerning capital calls and a possible settlement. In sum, Sanders also claims Mr. Sanders lived in Indianapolis for a the record is devoid of any evidence which would raise part of 1980. However, Sanders Ex. 3, p. 2, cited as support for questions as to Greater's and Sanders' entitlement to this finding, only concerns Sanders' business experience and 100% quantitative integration credit. doesn't discuss his residence in 1980. 4 107. Since the applicants are quantitatively equal, dis Mr. Reardon is also involved in various cellular telephone position of this case rests on the qualitative attributes of applications, as well as operation of a cellular radio telephone the applicants. Mrs. Hotopps's long term local residence system (Tr. 473, 476). He is represented by either the law firm offsets Mr. Sanders' minority status. Radio Jonesboro, Inc., of Besozzi & Gavin, of which Mr. Siebert is of counsel (Tr. 665), 100 FCC 2d 941, 945 (1985). With regard to the remain or by Gurman, Kurtis, Blask and Freedman, depending on the ing comparative qualitative attributes, Greater is superior. application or issue (Tr. 480). Simply put, Greater's substantial gender and moderate 5 Mrs. Hotopp's discussions with Mr. Reardon were general in civic participation credits (Mrs. Hotopp's involvement in nature and did not concern specific items such as format for the civic affairs since the mid 1970s) clearly outweighs Sand Greenwood station. station employees or even the name of an ers' award of slight local residence (Mr. Sanders· residence engineer she should employ (Tr. 651-652). in the service area since March 1987 and his promise to 6 Mr. Reardon and Mr. Karas had prior dealings (Tr.f 490-491, move to Greenwood)9 and slight civic participation credits 570). He is neither on retainer to Mr. Reardon nor to any (Mr. Sanders' involvement since October 1987). 10 ~ 108. company controlled by him (Tr. 490). Mr. Reardon had known In summary, neither applicant suffers a diversification Mr. Karas for about nine years (Tr. 490). Mr. Siebert had demerit. Both applicants propose auxiliary power. With introduced them (Tr. 570). They had discussed working together respect to the integration criterion, both applicants pro in management of Mr. Reardon's Haysville, Kansas FM station pose and receive 100% quantitative integration credit. (Tr. 490). They have met maybe three times (Tr. 570). They However, for the reasons discussed above, Greater's quali first met at dinner in 1981 or 1982 (Tr. 570). In 1984, they met tative attributes are superior. It should be noted that this at a National Association of Broadcasters meeting in Las Vegas, case is particularly difficult to decide because both ap Nevada (Tr. 572). Mr. Karas was then managing a Las Vegas plicants have impressive credentials. Notwithstanding, station (Tr. 572). In 1985, they met in Haysville (Tr. 570, 573). based on established comparative criteria, Greater is the They did not end up working together (Tr. 573). He and Mr. clear winner and will be granted the construction permit. Karas had discussed forming a limited partnership for the Roch Accordingly, IT IS ORDERED, That unless an appeal ester, New York FM allocation, but did not file an application from this Initial Decision is taken by a party, or it is (Tr. 490-491). Mr. Reardon probably reimbursed Mr. Karas for reviewed by the Commission on its own motion in accor some out of pocket expenditures related to travel for the Roch dance with Section 1.276 of the Rules/ 1 the application of ester FM (Tr. 491). Greater Greenwood Broadcasting Limited Partnership for 7 Mr. Reardon recalled only 3 or 4 such conversations (Tr. a construction permit for a new FM Station on Channel 601). 294A in Greenwood, Indiana IS GRANTED; and the 8 Mr. Reardon currently has ownership interests in a number application of Sanders Broadcasting Company Limited of pending applications. Partnership IS DENIED. 9 Even assuming Sanders' claim that Mr. Sanders lived in Indianapolis for a few months in 1980 was accepted, it would not improve Sanders' local residence credit. FEDERAL COMMUNICATIONS COMMISSION 10 Mr. Sanders merits no credit for broadcast experience. Mr. Sanders' telephone company experience does not demonstrate sufficient nexus to broadcast employment to merit enhancement credit. farad Broadcasting Co .. Inc .. 61 RR 2d 389 (Rev. Bd. 1986). Joseph Chachkin 11 In the event exceptions are not filed within 30 days after Administrative Law Judge the release of this Initial Decision. and the Commission does not review the case on its own motion, this Initial Decision shall become effective 50 days after its public release pursuant to Section 1.276( d).

5679