The dream may start at a young age, while listening to a favorite radio station. The dream to be part of what is coming out of those speakers. The dream to own a station.
Perhaps that is why the majority of the estimated 15,000 radio stations in the US are owned by smaller or independent operators.
You read that right. For all the attention focused on the “big guys,” only 13% of broadcast radio outlets — about 2,000 stations — are part of major groups.
As a result, it’s the smaller players that hold a majority role as the bedrock of their local communities. And not only in times of crisis. After all, small and independent owners live, eat, shop, and are active in every aspect of their neighborhoods and Main Streets.
Radio needs more of these owners, but dreams alone can’t buy stations. It ultimately takes money.
The Minority Tax Certificate program, launched by the FCC in 1978, was designed to bring more ownership diversity to the broadcasting industry. In and of itself, that’s a good thing. But the initiative does more than open doors to minority entrepreneurs.
Yes, it helps ease the barriers to entry by making purchasing capital more accessible to those who have all the qualifications but lack financial resources, but the benefit is not just to the buyer. It’s a win for sellers, offering the opportunity to defer capital gains taxes — a savings that can make the sale more attractive.
Even still, there’s more to this than a transactional arrangement offering a financial incentive to sellers and a realized dream to buyers.
Far too many stations, especially in smaller markets, are languishing due to benign neglect. They have become plug-and-play outlets for syndicated talent, or impersonal jukeboxes. Why not give those signals new life? Especially a life that could better serve their listeners and communities. And white men need not be excluded. There are plenty of women and minorities who could benefit from an experienced limited partner or stakeholder, regardless of gender or ethnicity.
Due to continued RIFs at all levels, many out there are eager to find a way to stay in the game. Some might even qualify for purchases on their own.
The original Minority Tax Certificate program had its critics, and some of their concerns were well founded. But with proper checks and balances in place, history doesn’t have to repeat itself in those areas where questionable advantage was taken. Those who need the opportunity should not be penalized for the predatory actions of a few.
Radio needs fresh blood if it is to survive. The Minority Tax Certificate could be just that infusion.
Amen, Deborah!