Posted on May 20, 2009

Democrats Seek Financial Rescue of Minority-Owned Broadcasters

Silla Brush, The Hill, May 19, 2009

High-ranking House Democrats are urging the Treasury Department to prop up minority-owned broadcasters suffering from a lack of capital and lost advertising revenue amid the economic slump.

House Majority Whip James Clyburn (D-S.C.) is leading an effort to convince Treasury Secretary Timothy Geithner to take “decisive action” by extending credit to this sector of the broadcasting industry.

Clyburn and other senior members, including House Financial Services Committee Chairman Barney Frank (D-Mass.) and Ways and Means Committee Chairman Charles Rangel (D-N.Y.), argue that minority-owned broadcasters are sound businesses, but that the recession could undermine the government’s efforts to diversify the airwaves.

A number of members from the Congressional Black Caucus signed the letter, too.

“While many jobs are at stake, a more important principle–the government’s fundamental interest in promoting a diversity of voices, including service to underserved communities–is severely threatened,” the members write in a draft of a letter that was scheduled to be sent Tuesday.

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The congressmen suggest the Treasury Department could provide access to capital to minority-owned broadcasters, which they say represent less than 7 percent of full-power radio stations and a “negligible” ownership of television stations.

“They are looking for continued access to capital to continue their otherwise fundamentally sound operations,” the members write.

The letter suggests Treasury could set up a credit facility specific to the industry, similar to the government’s efforts to support auto suppliers, or possibly set up a program for bridge financing and government-backed loans until the economy improves.

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Other members signing the letter are Democratic Reps. Bobby Rush (Ill.), Edolphus Towns (N.Y.), Maurice Hinchey (N.Y.), Carolyn Maloney (N.Y.), Maxine Waters (Calif.), Gregory Meeks (N.Y.), G.K. Butterfield (N.C.), Barbara Lee (Calif.), Lynn Woolsey (Calif.) and Bennie Thompson (Miss.)

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