FCC rejects petition to block WLRN purchase of Palm Beach station

The FCC will not block South Florida Public Media Group’s purchase of an FM station in Palm Beach County, according to a Feb. 18 letter released by the commission’s Media Bureau.

Under the proposed license transfer agreement, filed with the commission in June, SFPMG would acquire West Palm Beach’s The Flame 104.7, a commercial station broadcasting under the call letters WFLM, for $6.45 million.

The Miami-Dade County School Board, which opposes the purchase, holds the license of dual-service WLRN in Miami; SFPMG manages the stations under a contract with the school board.

The school board petitioned the FCC to block the acquisition in July, then filed a lawsuit in September with the Circuit Court of the Eleventh Judicial Circuit in Miami-Dade County. The lawsuit seeks a court order blocking the transfer of funds needed to complete the purchase.

The court is scheduled to take up the dispute Wednesday during a hearing on SFPMG’s motion to transfer the case to the Complex Business Litigation Division, according to the court docket.

The court case, and the conflict it seeks to settle, were beyond the scope of the FCC license application, Albert Shuldiner, chief of the media bureau’s audio division, wrote in his letter to petitioners and their attorneys. Upon reviewing the FCC application, the subsequent petition to deny, replies, supplemental pleadings and a motion to dismiss, the commission found no reason to block the acquisition.

“After careful consideration of the record, we find that grant of the Application is not inconsistent with the public interest, convenience, and necessity,” Shuldiner wrote. “Additionally, we find that the dispute pending in the Circuit Court of the Eleventh Judicial District in Miami-Dade County, Florida, is a private contractual matter and does not provide a basis for denying or deferring action on the instant Application.”

“Absent a final court judgment raising issues within the Commission’s jurisdiction or an injunction specifically prohibiting the filing or processing of the Application, we do not withhold consent to an otherwise acceptable application,” Shuldiner added.

SFPMG CEO John LaBonia told Current in an email that “we have no comment at this time.”

“The School Board of Miami-Dade County intends to appeal the FCC’s decision to ensure that WLRN’s resources remain dedicated to our local community,” a spokesperson said in a statement to Current. “We believe this acquisition diverts vital support away from the talented employees and high-quality programming at WLRN, which make the station a community treasure. Our priority is to protect these public assets for the listeners and the employees who depend on them.”

Dispute over revenues

According to its FCC petition and lawsuit, the school board contends that SFPMG has no independent sources of funding other than the donations it raises for WLRN and leasing revenues earned from its Educational Broadband Service frequency. Funds generated from fundraising and spectrum leases are part of the WLRN endowment and are not available for “unrelated activities,” the board argues.

The board’s FCC petition asserted that any use of funds from WLRN’s endowment or donation revenues “would constitute a misappropriation of funds.”

In its response to the petition in July, SFPMG called the school board’s opinion “nothing more than an effort to lure the Commission into a private disagreement in which the School Board is erroneously asserting a claim to SFPMG’s assets.”

SFPMG is the FCC licensee for the EBS license WHR866 and leases the spectrum to Clearwire Spectrum Holdings II LLC, the group said in its reply. Revenues from the spectrum lease are financing the purchase.

“The School Board is not the licensee of WHR866, and the School Board is not a party to the EBS leasing arrangement between SFPMG and Clearwire,” the response filing said. “Simply put, the School Board has no claim to the revenue derived from the WHR866 EBS lease and any assertion otherwise by the School Board is, at most, a private business dispute wholly outside the Commission’s jurisdiction.”

In its court case, the school board seeks a court order requiring SFPMG to deposit $645,000 — the same amount it placed as a deposit for WFLM — into the endowment benefiting WLRN. It also asks the court to bar SFPMG from spending the $5.8 million that would complete the purchase.

After Wednesday’s court hearing, former Circuit Court Judge Michael A. Hanzman is scheduled to lead a mediation meeting Thursday morning.

This article has been updated to include a statement from Miami-Dade County Public Schools.