AMENDING THE COMMUNICATIONS ACT OF 1934 WEDNESDAY, MARCH 27, 1968 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON COMMUNICATIONS AND POWER, COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE, Washington, D.C. The subcommittee met at 10 a.m., pursuant to notice, in room 2361, Rayburn House Office Building, Hon. Torbert H. Macdonald (chairman of the subcommittee) presiding. Mr. MACDONALD. The hearing will come to order. This morning we are holding hearings on H.R. 15986, which would amend the Public Broadcasting Act of 1967 so as to postpone from 1968 to 1969 the authorization for the appropriation of $9 million to support the Corporation for Public Broadcasting until it can be sustained by a permanent plan for financing. (H.R. 15986 and departmental reports thereon follow :) [H.R. 15986, 90th Cong., second sess.] A BILL To amend the Communications Act of 1934 by extending the authorization of appropriations for the Corporation for Public Broadcasting Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That paragraphs (1) and (2) of section 396 (k) of the Communications Act of 1934 are each amended by striking out "1968" and inserting in lieu thereof "1969”. ! EXECUTIVE OFFICE OF THE PRESIDENT, BUREAU OF THE BUDGET, Washington, D.C., March 27, 1968. Hon. HARLEY O. STAGGERS, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, DEAR MR. CHAIRMAN: This is in response to your request for our views on H.R. 15986, a bill to amend the Communications Act of 1934 by extending the anthorization of appropriations for the Corporation for Public Broadcasting, introduced March 14, 1968. H.R. 15986 would change the authorization enacted in the Public Broadcasting Act of 1967 from fiscal year 1968 to fiscal year 1969. This is necessary because the Corporation is only now being organized and getting underway. The Bureau of the Budget recommends favorable consideration of H.R. 15986 and its enactment would be in accord with the program of the President. Sincerely yours, WILFRED H. ROMMEL, Assistant Director for Legislative Reference. (1) DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, Hon. HARLEY O. STAGGERS, Chairman, Committee on Interstate and Foreign Commerce, DEAR MR. CHAIRMAN: This letter is in response to your request of March 15, 1968, for a report on H.R. 15986, a bill to amend the Communications Act of 1934 by extending the authorization of appropriations for the Corporation for Public Broadcasting. This bill embodies the legislative proposal contained in a draft bill submitted by this Department to the Congress on March 11, 1968. For your convenience a copy of the letter to the Speaker of the House briefly explaining the proposal is enclosed. We urge early enactment of this proposed legislation. The Bureau of the Budget advises that enactment of this proposed legislation would be in accord with the program of the President. Sincerely, WILBUR J. COHEN, Acting Secretary. DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, Hon. JOHN W. MCCORMACK, DEAR MR. SPEAKER: Enclosed is a draft of a bill to amend the Communications Act of 1934 by extending the authorization of appropriations for the Corporation for Public Broadcasting. In view of the delay in the initiation of the Corporation's activities, it is unlikely that it would need or be able to use any appropriated funds this year. We anticipate, however, that it will begin to need and be able to use such funds in fiscal year 1969. The enclosed draft bill would take cognizance of this situation by substituting for the present authorization of $9,000,000 for fiscal year 1968 an authorization of a like amount of appropriations for fiscal year 1969. As the President indicated in his Message on education, we will be working with the Secretary of the Treasury, the Director of the Bureau of the Budget and the Board of Directors of the Corporation for Public Broadcasting, as well as appropriate Congressional committees, to formulate a long-range financing plan. We should appreciate it if you would refer the enclosed draft bill to the appropriate committee for consideration. We are advised by the Bureau of the Budget that enactment of this bill would be in accord with the program of the President. Sincerely, WILBUR J. COHEN, FEDERAL COMMUNICATIONS COMMISSION, Hon. HARLEY O. STAGGERS, Chairman, Committee on Interstate and Foreign Commerce, DEAR MR. CHAIRMAN: This is in reply to your letter of March 15, 1968 requesting the Commission's comments on H.R. 15986, a bill to amend the Communications Act of 1934 by extending the authorization of appropriations for the Corporation for Public Broadcasting. When your Committee was considering S. 1160, which became the Public Broadcasting Act of 1967, the Commission supported the creation of the Corporation for Public Broadcasting and the provisions of the bill relating to it. H.R. 15986 substitutes for the present authorization of $9,000,000 for expenses of the Corporation for fiscal year 1968 an authorization of a like amount of appropriations for fiscal year 1969. It also substitutes for the fiscal 1968 restriction to $250,000 of appropriated funds for payments under any grant or contract made by the Corporation for any one project or to any one station a like restriction for fiscal 1969. We understand that these amendments are technical in nature necessitated by the delay in the nominations of the directors of the Corporation and the consequent delay in its organization. The Commission therefore has no objection to enactment of H.R. 15986. Sincerely yours, ROSEL H. HYDE, Chairman. Mr. MACDONALD. In his education message to the Congress dated February 5, 1968, President Johnson stated: I am asking the Secretary of Health, Education, and Welfare, and the Secre tary of the Treasury, the Director of the Bureau of the Budget, all of whom have been studying this problem since the law was enacted, to work with the Board of Directors of the Corporation for Public Broadcasting and the appropriate committees of the Congress to formulate a long-range financing plan that will promote and protect this vital new force in American life. Because of the importance of the long-range plan of financing, and the Interstate and Foreign Commerce Committee's involvement in the Public Broadcasting Act of 1967, we would expect to receive assurance, which I am sure we will get today, from the representatives of the Departments of Health, Education, and Welfare, and the Treasury, and the Bureau of the Budget that the House Committee on Interstate and Foreign Commerce is an "appropriate committee of the Congress" within the meaning of the President's message. We would also like some indication from those representatives on how they intend to work with this committee in formulating a longrange financing plan for the corporation. Unfortunately, the Chairman of the Board of Directors of the Corporation, the Honorable Frank Pace, Jr., is hospitalized and cannot appear before the subcommittee today. However, the subcommittee is fortunate in having in his place the Honorable Joseph D. Hughes, of Pittsburgh, Pa., who is a member of the Board of Directors. He is a governor and vice president of T. Mellon & Sons, and is also cochairman of the Pennsylvania Committee for Public TV. If Mr. Hughes will come forward, I understand he is accompanied by a gentleman who is well known to us, and who is a great friend of our very distinguished chairman of the full committee. We welcome you both. I am sure Chairman Staggers would like to say a few words in welcoming you both. Mr. STAGGERS. Thank you very kindly, Mr. Macdonald. I would like to welcome Mr. Hughes and Mr. Stephen Ailes to the committee. As Chairman Macdonald has said, Mr. Hughes is a renowned banker from Pittsburgh, with a name we have known for many years to be associated with money, the Mellon interests. I would like to welcome Stephen Ailes, who is one of our distinguished West Virginians. He is the grandson of one of the great and distinguished Governors of our State. He is also former Secretary of the Army of the United States. We are happy to have both of you. We are especially happy to welcome Mr. Ailes because I have known him, his family, and all of his relatives, who live in my district, close by my hometown at Keyser. They live in Romney. Steve now is a member of the law firm of Step toe & Johnson. We do welcome both of you to be witnesses on what I consider to be an important subject that affects all America. Thank you, Mr. Chairman. STATEMENT OF HON. FRANK PACE, JR., CHAIRMAN, BOARD OF DIRECTORS, CORPORATION FOR PUBLIC BROADCASTING, PRESENTED BY JOSEPH D. HUGHES, MEMBER, BOARD OF DIRECTORS; ACCOMPANIED BY STEPHEN AILES, COUNSEL Mr. HUGHES. Mr. Chairman and members, we regret that Mr. Pace could not be here to present this statement to you this morning. He underwent major surgery last Thursday for kidney stones, from which he is recovering quite nicely. It appears, however, that a period of convalescence of several weeks will occur before he is back in harness and able fully to resume a role in the Corporation for Public Broadcasting. The statement which I will present in his behalf was worked out with Mr. Pace by telephone, and is his statement. It is as follows: Mr. Chairman and members of the subcommittee, it is a great pleasure for me to have this opportunity to present to you my views on the proposed bill authorizing appropriation of funds for the Corporation for Public Broadcasting for the fiscal year ending June 30, 1969. Before turning to the bill itself, I want to pay tribute to the significant role that members of your subcommittee played in the legislative process which resulted in the Public Broadcasting Act of 1967 and thus in the creation of the Corporation for Public Broadcasting. I am very pleased to report that the necessary incorporation papers will be filed today and the Corporation formally established as a nonprofit corporation in the District of Columbia. I look forward in the next weeks to the first formal meeting of the Board of Directors, of which I have the honor to be Chairman. My fellow Board members are distinguished Americans, some with backgrounds in television and radio, and others with broad experience in other aspects of government, education, business, and cultural affairs. As I do, they come to this new and exciting venture with a deep sense of purpose and with an openmindedness as to how we should function to carry out the broad intent of the legislation. It was the desire of both the President and the Congress that this corporation be independent in practice as well as in theory. In my judgment, there is no better guarantee of this than the men-and the lady-who were chosen to be the incorporators and first Board of Directors. They are people of stature and ability who have already made great contributions to American life. It is clear that they take this new responsibility most seriously and, working closely with the Congress, will strive to see to it that the Corporation achieves the great goals set by the legislation. The opportunities and responsibilities facing this new instrumentality are enormous. We are all aware that television is an immensely powerful technology— new in any relative sense and growing steadily more influential. We all seek to bring this technology into the full service of man and to do so within the framework of our creative free society. At the same time, we are aware that the older institution of radio remains a vital and progressive force in American life, deserving of the attention of the Corporation for Public Broadcasting. Since the Board has not formally met, I cannot speak for the directors as a body. But in the weeks since the President's nomination, I have talked with many of its members and with many other people who have assessed the nature and purpose, as well as the experience of television to date. I have sought their advice on what we should do and how we should go about doing it. My own view of the immediate future is clear. While I do not want to disappoint any of the short-range hopes held by many for this Corporation, it would be equally dangerous to encourage false hopes that dramatic new departures in broadcasting are going to be achieved overnight. We shall move carefully-some may say cautiously, but nevertheless, our mandate from the Congress requires us to begin the first steps of the journey. For example, it is clear that one of our main long-term functions will be to strengthen the programming available to public television. It is also clear that this is to be done mainly by strengthening local stations, providing them with more choice in what they present, while at the same time helping them to maintain their independence. We hope to learn much from what others have done in |