The FCC\u27s Minority Ownership Policies from Broadcasting to PCS

The Federal Communication Commission\u27s (FCC\u27s) proposed minority preference scheme for broadcast spectrum allocation has been called into question in the wake of the Supreme Court(s recent decision in Adarand Constructors, Inc. v. Pena. The Authors begin by discussing the development of minority preference schemes in the 1970s and 1980s and the changes in the methods through which the FCC has awarded broadcast licenses. In 1993, the FCC was granted the authority to auction spectrum allocation, provided that the FCC ensured the economic opportunity of minority-owned business under such a competitive bidding regulatory regime. However, this grant of authority presented the FCC with a legal concern: ensuring that the a minority preference scheme was not violative of the Equal Protection Clauses of the Fifth and Fourteenth Amendments. To this end, the FCC established entrepreneurs\u27 blocks in which two spectrum blocks were set-aside for applicants meeting certain financial qualifications. These financial-based eligibility restrictions appeared to create a solid legal foundation. However, the Adarand decision has resulted in the FCC postponing the proposed entrepreneurs\u27 block auction indefinitely. The remainder of the Article is a discussion of the Adarand decision and its effect on the proposed blocks. In particular, the Authors discuss whether the FCC-proposed scheme will survive the strict scrutiny standard imposed by Adarand