2021 NCE Window: What's next in the process? (updated 5/2/22)

As we proceed through the aftermath of the 2021 NCE Filing Window, some may be asking, how long it is going to take for the FCC to start granting applications.  If we attempt to compare to the 2007 NCE window, it may be a challenge to compare since the 2007 window was much more enormous in scale.  In 2007, the FCC received over 3,000 applications, which resulted in the establishment of 457 groups of mutually exclusive (MX) applications.  By comparison, in the 2021 window, the FCC received 1,282 applications, resulting in 231 MX groups.

Let’s look at the timeline of the post-window events and how they will likely go.

Close of the filing window

In 2007, the FCC ended the filing window on October 22, 2007.  This included a short extension of the deadline due to a verified issue with CDBS.  The 2021 window ended on November 9, 2021.  While REC did receive inquiries that the window should be extended, we were unable to identify any widespread performance issues with LMS.  Other than some of the quirks that those of us experience when we interact with LMS on a regular basis (such as the system logging you out in the middle of doing something), we did not notice anything extremely different during the NCE window.  In fact, LMS did behave a bit better than CDBS did during the 2007 NCE and 2013 LPFM windows, even during the home stretch rush near the cut off time for the window.

Identification of singleton applications

While we do not have the specific information for the 2007 window, in the 2021 window, the FCC immediately imposed a filing freeze after the close of the window.  This permitted Staff to identify the MX groups and determine which applications were singleton.  The filing freeze would last until November 29, 2021 (20 days after the close of the window).  Most of the identified singletons from the 2021 window appeared on the “Applications” Public Notice, published on November 16, 2021 (7 days after window close).  Once the singletons were identified, they were put up on a 30 day hold for Petitions to Deny.  The first singleton grants in the 2021 NCE window were on December 20, 2021 (41 days after window close).

Identification of MX groups and settlement window

Because of the massive scale of the 2007 window, this was divided up into four phases.  First, on November 8, 2007 (17 days after window close), the FCC opened a settlement window that would run through January 7, 2008 (77 days after window close).  At that time, the FCC did not actually release any lists of MX groups.  Instead, they advised applicants that they need to weed through the database and determine whether they were MX.  Of course, computer programs made this task a little easier.

In 2007, the FCC would eventually release the identity of the MX groups a few months after the settlement period ended.  Because of the massive size of the window, the FCC split the MX groups into three categories.  The first list was released on March 7, 2008 (137 days after window close), which included 263 groups that had between 2 and 4 applicants per group.  The second list was released on June 18, 2008 (240 days after window close).  This list identified 148 MX groups with 5 to 13 applicants in each group.  The final list would be released on October 9, 2008 (353 days after window close) and would identify 46 groups with more than 13 applicants per group.

Because of the smaller scale, 2021 was handled much differently.  On November 29, 2021 (20 days after window close), the FCC not only announced a settlement opportunity until January 28, 2022 (80 days after window close), but they also released the list of all 231 identified MX groups, regardless of the group size.  In other words, the FCC combined four documents (as was the case in 2007) into a single document release.  This cut off about 11 months from the process when compared with 2007. 

During the settlement window and the time afterwards up to this writing, 73 MX groups have been dissolved through amendments to become singleton and dismissals.

Threshold Fair Distribution Analysis of MX groups

When an MX group is evaluated, the first thing that is looked at are claims of fair distribution preference.  This includes applicants that: (1) introduce first service over land area where there is currently no community contour AM or FM coverage, (2) qualifies for tribal priority, (3) can provide a first NCE service to at least 2,000 persons and (4) can provide a second or aggregated first and second NCE service to at least 2,000 persons.  In the latter two, greater consideration is given to applicants who can propose the appropriate service level to 5,000 more people than other applicants in the same category. If no applicant in the group qualifies, or there are no communities to compare or if there is still a “tie” after considering the criteria mentioned, then the group goes to the point system.

During the Threshold Fair Distribution Analysis, the FCC identifies MX groups where the tentative selectee can be determined using the fair distribution criteria above and it does not have to resort to the point system. 

In 2007, because the MX group lists were released in three phases, they spread out the releases of the tentative selectees, with the release of 8 orders over a 26-month period.  The average release addressed about 23 groups.  Overall, the FCC analyzed 183 MX groups including split groups (those that were bifurcated/split as a result of amendments to become singleton and voluntary dismissals).  The first of those lists was released on June 23, 2008 (245 days after window close, 108 days after identification of first MX groups).

For 2021, REC has identified 73 MX groups and split groups that would fall under the threshold fair distribution criteria.  We also know that while the settlement period ended on January 28, 2022, multiple groups were given an extension until March 7, 2022 to work out their settlement agreements. 

Now, just out of pure speculation, we could see the FCC releasing, perhaps three Threshold Fair Distribution orders.  Perhaps the first order(s) will be for those MX groups that did not request an extension of their settlement period.  If we consider the timeline from 2007 in speculating about 2021, we can probably estimate that the first Fair Distribution order could come out as soon as March 17, 2022 or Staff can hold off on everything until the extended settlements are in and then we would be looking at around April 22, 2022 and then if staff does divide the orders up into groups of about 25 each, it is very likely that they could be done with the 73 “easy” and “easier” groups by, perhaps, the end of June or perhaps into July.  Again, this is only speculation.

Comparative Consideration of MX Groups

An MX group can go to the point system through one of three ways: (1) if no applicant claims fair distribution, (2) if all MX applicants are in the same community, regardless of fair distribution claims or (3) if a tentative selectee can’t be determined through a threshold fair distribution analysis.  In the point system, 3 points are awarded for a showing of established local presence where the organization has been established and has either 75% of their board members, their headquarters or campus within 25 miles of the reference coordinates for the community of license. 2 points are awarded for a diversity showing that that the applicant has no other holdings in the area through either a separate statement attesting to such or through a contour map showing other holdings.  2 points can be awarded for a “state-wide network”, which is reserved for stations proposed by entities that operate either 50 K12 or 5 college campuses and actually deliver academic programming to campuses by radio.  This is a very antiquated method.  No applicant can claim both state-wide network and diversity.  Technical points are also awarded to the top applicant in both land area and population if those values are at least 10 or 25 percent better than the next best applicant.  In the event of a tie, there are tie breakers based on total number of current authorizations, number of pending applications and previous outcome for the organization in the 2007 and 2010 NCE windows.  If there is still a tie, the two oldest local organizations would be placed into a time sharing arrangement.

Unlike the fair distribution threshold analysis process, which is conducted by the Media Bureau under delegated authority, comparative reviews of applicants through the point system are prepared by the Media Bureau and then presented through circulation to the full Commission for a vote and adoption.  This is a hold-over from the old days of the Commission approving comparative reviews for competing applications.  A process that was eventually replaced by the simplified point system for NCE and competitive bidding (auctions) for commercial applications.

In the 2007 window, there were over 220 MX groups and split groups that went to the point system.  These comparative reviews were conducted in 8 orders over a 15 month time span.  The first comparative review was conducted on February 16, 2010 (848 days after window close, 63 days after the last threshold fair distribution order). 

In 2021, we are estimating that there will be about 80 MX groups that will be going to the comparative process/point system.  If we follow a similar schedule of the gaps between how staff handled the time between the fair distribution analysis and the comparative review orders in the 2007 window, we can speculate that the first comparative review order would probably be adopted in September, 2022.  This may be done in multiple orders, so it could take until the end of the year before everyone is finished.

Challenges to the FCC’s determinations

When applications are considered as tentative selectees, they go on a public notice process for 30 days to allow for the filing of informal objections and petitions to deny.  At this time, those who wish to challenge the outcome of an MX group can file a pleading.  This is where things can get substantially delayed as staff needs to sort out the claims made in the pleading and if staff does grant an objection and if it involves the point system, it will need to be circulated through the full Commission for adoption. 

Conclusion

While we do understand the many constraints that staff is under right now, especially in light of the current remote working situation and the fact that Media now has a new Bureau Chief who may see the timeline differently, this process is going to take some time and accordingly, applicants should be patient through this “hurry up and wait” process that is very normal for government.  The Audio Division does not necessarily have dedicated staff for the window, so they will also be involved with other work. 

With the much lower volume in the 2021 window, as compared with the 2007 window, it will also mean that staff will their work done sooner, which will increase the appetite for the processes to start the next LPFM filing window, which former Chairman Pai pretty much promised would happen following the NCE window.  Assuming that the Commission could get through entire fair distribution and comparative process by the end of October, I would not be surprised that our Christmas present this year would be a public notice announcing an LPFM window in early 2023.  Of course, the FCC could do the first LPFM announcements before then and late 2022 may also be a reality.  It’s up to the full Commission, who the Media Bureau answers to and then its also up to the Media Bureau itself to determine where its resources should be prioritized. 

Again… be patient with staff through all of this!

Timeline of the 2007 NCE Window for reference only

Our very speculative timeline for the 2021 NCE Window

Potential order of handling by MX group (5/2/2022)

When we look at how the FCC handled the 2007 window and how the FCC has handled the 2021 window so far, the appear to be first processing the groups with a lower number of applicants before going to the groups with a higher number of applicants.  The following list shows the 2021 MX groups in order of how many pending applications are in the group.  Group numbers in bold have already been decided by the FCC.  This may give a speculative impression as to which groups will be next.

Fair distribution

Comparative Review

Our even more speculative timeline for the next LPFM window

This assumes that it takes the Commission until the end of the year to finish the NCE comparative reviews, takes a break for the holdiays and picks up in January, 2023.  This is based on the intervals from the 2013 LPFM window and LMS behavior in the 2021 NCE window.  Keep in mind, the FCC may open multiple settlement opportunities based on the volume of applications (in 2013, they did three settlement windows after identifying tentative selectees). 

Again, this is only pure speculation.. and nothing more!