“It’s not a done deal,” says Neal Rabe of Washington, Missouri.

Rabe is a member of the Lutheran Church-Missouri Synod; now retired, he worked for a Lutheran insurance company, and even worked for the Synod at one point in his career. And, like many members of the LCMS, he opposes the sale of KFUO-99.1 FM to “Christian contemporary” broadcaster Joy FM.

In a thoughtfully written letter to Jeffrey Tignor, acting chief of the Federal Communications Commission’s consumer complaints division, he makes some solid points. Although the FCC officially doesn’t care about formats, they should care about the financials and the secrecy that has led, in the opinion of some observers like Rabe, to an appearance of collusion. Rabe has given permission to reproduce his letter here:

Mr. Jeffrey Tignor, Acting Chief
Consumer Complaints Division
Federal Communications Commission
445 12th Street SW
Washington, DC 20554
Re: The pending sale in St. Louis, MO of KFUO (99.1 FM), “Classic 99,” by The Lutheran Church-Missouri Synod (LCMS) to Gateway Creative Broadcasting (Joy FM)

Dear Mr. Tignor:

It is my understanding that the pending sale of KFUO-FM by the LCMS to Gateway Creative Broadcasting is not a done deal. The transfer of the broadcast license must be approved by the Federal Communications Commission (FCC).

The FCC is perceived to be consumer oriented and responsive to public input, especially if there is appearance of discrimination or collusion.

Assuming the accuracy of that perception, this letter supports petitions you are receiving to delay or deny the proposed sale. Hopefully, prior to granting approval, the FCC will conduct a review hearing relative to one or more of the following concerns.

Concern #1: The Board of Directors of the LCMS maintains that it has exercised due diligence in coming to mutually agreeable terms with the owners of Joy-FM for the pending change in license ownership. However, the latest Form 1099 filed by Gateway Creative Broadcasting with the Internal Revenue Service leads one to question the fiscal ability of the proposed buyer to fulfill its obligations under the purchase agreement. Its present assets are meager. Its current income from listener donations, fees for broadcast time and services plus investment income scarcely covers operational expenses of its existing lower-overhead small rural stations. These existing “rim stations” are not debt free. It appears that Joy-FM will at best be marginal in meeting expanded day-to-day operational overhead if the sale is approved. The additional proposed 10-year amortization obligation for the owners of Joy-FM to actually purchase the KFUO-FM license from the LCMS is an unrealistic challenge for Gateway Creative Broadcasting. Fiscal default appears not only possible, but probable.

Concern #2: “Classic 99″ is a revered partner with classical music and arts organizations in the greater St. Louis area. As such, its presence has a positive economic impact on the St. Louis region. Promoting music and the arts is a natural outcome of its programming format. If the KFUO-FM license is sold to a new owner not committed to the “Classic 99″ format, promotion of and ticket sales for the St. Louis Symphony Orchestra, the Bach Society of St. Louis, the St. Louis Chamber Chorus, the Missouri Botanical Garden, the Repertory Theatre of Saint Louis, the Touhill Performing Arts Center, Opera Theatre of Saint Louis and many other cultural entities would be adversely affected. The collective result would negatively impact the entire St. Louis economy.

Concern #3: Reportedly, there was no defined process for the sale of KFUO-FM that allowed for participation by at least two interested potential buyers committed to retain the “Classic 99″ classical format. A group of interested Lutherans as well as the KFUO-FM Radio Arts Board each sought to participate in the negotiation process. Apparently both were denied the opportunity. The degree of secrecy has spawned the appearance of discrimination or collusion.

Concern #4: KFUO-FM operates under the Communications Act of 1934 passed by the United States Congress. This Act mandates that all FCC-licensed broadcasting must serve the public interest, convenience and necessity. “Classic 99″ is one of the few award-winning classical stations in the nation. It is the only classical station in St. Louis, MO. Its unique programming impressively serves the public interest, convenience and necessity. If the FCC approves the pending sale to Joy-FM, the format will change to contemporary Christian. St. Louis already has other contemporary Christian stations, but nothing else like “Classic 99.”

It is indeed unfortunate that LCMS must liquidate one of its prize assets to pay its own day-to-day expenses. However, inasmuch as there are other potential buyers who are committed to retaining the “Classic 99″ format, perhaps a return to an expanded negotiation table would be a win-win for everyone, including Joy-FM (see Concern #1).

Respectfully,
Neal Rabe