legislative history provides that approximately 25 percent of CPB's annual budget for radio and TV by fiscal year 1981 should be allocated to public radio.

NPR's position stems from relationship established between Section 396(k)(3)(B)(iv) which directs CPB:

"In determining the amounts of funds which shall be made available for radio programming and operations under this subparagraph, the Corporation shall take into account the increased financial needs relating to radio programming and operations resulting from the expansion and development of noncommercial radio broadcast station facilities through the use of funds made available pursuant to Section 393(d)."

And that portion of the PTFA dealing with the Public Telecommunications Facilities Program which provides in Section 393(d):

"Of the sums appropriated pursuant to section 391 for any fiscal year, a substantial amount shall be available for the expansion and development of noncommercial radio broadcast facilities."

NPR contends that the language in 396(k)(3)(B)(iv) should be interpreted by relying on the language found in the report of the House Committee with respect to both the CPB title of the PTFA and the facilities title.

The House version of the bill contained language for 396(k)(3)(B)(iv) which was identical to the final statutory language. However, the House version of Section 393(d) read:

"Of the funds appropriated pursuant to Section 391 for any fiscal year, not more than 25 percentum shall be available for the expansion and development of noncommercial radio broadcast station facilities."

NPR argues that these two provisions are tied together by a portion of the House report which comments on what was then 393(k)(3)(B)(iii):

"Under the new facilities program, the Committee is authorizing nearly twice as much for radio facilities over the next 3 years as was appropriated over the last 8 years combined. The Committee's amendment to Section 396(k)(3)(B)(iii) provides that the Corporation is to insure a level of funding for radio programming commensurate with the expansion in facilities. The two must be viewed as directly linked. Accordingly, it is the Committee's hope that over the duration of this legislation the Corporation will increase (to approximately 25 percent) the share of its funds it provides public radio through both the CSG's and the programming grants to NPR and other producing entities." (Housing report at page 26).

However, NPR overlooks a critical paragraph in the same document from which they seek support-the House report. The first paragraph in the report commenting on 396(k)(3)(B)(iii) states explicitly:

"Paragraph (3) of subsection 396(k) also is amended to direct the Corporation to take into account the increasing financial needs of radio in determining the division of funds between radio and television. No particular percentage is specified because it is intended that the Corporation should retain the flexibility to assess and respond to needs which may change from year to year." (Italics added.) (House report at page 26).

This Congressional intention, flexibility for CPB in the allocation of funds, was codified in 396(k)(3)(B)(iii) and, as indicated above, survived the conference to appear unchanged in the final bill. The need for CPB discretion in this area has thus remained consistently recognized by the drafters.

The 25 percent requirement for funds for the expansion and development of facilities for radio did not fare as well. In the conference, where no Senate position on the matter was represented, the House managers receded from their provision of a specified 25 percent funding level, and agreed with their Senate counterparts that: a priority of this program should be to strengthen public radio through the provision of adequate levels of funding for expansion and development. While the conferees agree that a specific set-aside would remove necessary discretion in the administration of the program, the conferees expect that the funding received by public radio should approximate the percentages received during fiscal years 1977 and 1978, or should be greater if eligible radio expansion and development applications so justify. In addition, the conferees expect that the Secretary of Commerce will coordinate activities in this area with those of the Corporation for Public Broadcasting." (Conference report at page 25.)

Thus the nondiscretionary limit of 25 percent was eliminated from the facilities provisions and replaced with the words "a substantial amount." It is clear from the legislative history that this 25 percent level was the nexus between the facilities title in the bill and the CPB budget section. Accordingly, the House Report language relating to a specific percentage applicable to the CPB budget was vitiated, so as to give the Corporation flexibility in determining the amounts of its funds to be allocated to radio and television. In any event, the language guaranteeing CPB

flexibility in administration of funds has remained unaltered throughout. That position is consistent with a theme running throughout the conference report and the final PTFA which gives to CPB the necessary discretion in the management of its fiscal responsibility. Through the above-quoted conference language, that discretion was extended to the managers of the facilities program.

The argument has also been made that the 25 percent level deleted from the facilities provisions was different and distinct from a 25 percent level for operations under the CPB budget provisions. That theory suggests that the 25 percent programming and operations guidelines, not being addressed in the conference report, was retained in the CPB title from the House version and thus the House report language would be controlling. There is no basis in fact nor support in the legislative history for this argument. Clearly, the 25 percent referenced in the House report (but not reflected in the bill language) referred to the facilities title provision as expressed in the language quoted above from page 26 of the House Report. There is no reference to any 25 percent guideline outside of the reference to the facilities program.

CPB recognizes that Congress' predominant desire was to give the Corporation flexibility in the administration of its funds. However, CPB also recognizes its responsibility to public radio. The Corporation has been and will continue to be aware of the increasing needs of public radio, particularly in response to the increasing commitment made to radio under the facilities program. CPB intends to be a knowledgable and active partner with NTIA in the development of NTIA's plan for the direction and administration of the facilities program.

In addition, CPB's own five-year plan will treat public radio as a vital element in the long-range development of public telecommunications.

It is the Corporation's belief that to best serve radio and all other public telecommunications components, it is necessary for CPB to have maximum flexibility in the prudent management and allocation of its funds. CPB is confident that the legislation provides that flexibility.

Mr. WIRTH. I think that there is perhaps some debate about that. We might talk about what the intent of the subcommittee was and the conferees, and what remains is the final statement. I think all of us were very leery of setting any percentages on this, but I think the intent was to encourage public radio where possible. Perhaps we can go into that at a later date. Time is running along here, and let's not have parliamentary discussions about the percentages in public radio.

If there are no further questions, I thank you all for being here, Mr. Fleming, Mr. Cardwell, and Mr. Linn.

Mr. FLEMING. Thank you very much.

Mr. WIRTH. We will proceed as quickly as possible to our next witnesses. But before doing that, we have other seats up here and I think there are a couple of seats back here. Mr. Mason and Mr. Grossman and others, if you would like to, please sit down.

Before getting to the panel on insulation of public broadcasting, we have two other witnesses. We are running a little behind time here.

The next two witnesses we would like to have, if we might, is a panel consisting of Mr. Michael Middleton, from the Office of Civil Rights at HEW, and Mr. James Fellows, who is president of the National Association of Educational Broadcasters.

Mr. Middleton and Mr. Fellows, please. If we might proceed, I think that your statements are with the committee and can be submitted in full for the record. If you would like to summarize those in any way in which you think it might be appropriate, we might proceed, starting with Mr. Middleton.

Thank you for being here.

STATEMENT OF MICHAEL A. MIDDLETON, DEPUTY DIRECTOR, OFFICE OF STANDARDS, POLICY AND RESEARCH, OFFICE FOR CIVIL RIGHTS, DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, ACCOMPANIED BY WILLIAM H. VAN DEN TOORN, OFFICE OF INTERGOVERNMENTAL AFFAIRS

Mr. MIDDLETON. I am Michael Middleton, Deputy Director, Office of Standards, Policy and Research at the Office for Civil Rights. With me is Bill Van den Toorn from our Office of Intergovernmental Affairs.

Mr. Chairman and members of the subcommittee, we would like to thank you for having us here today. As you pointed out, our statement has been submitted, and I will briefly summarize where we are in the development of our EEO regulation applying to these telecommunications entities.

The Department, and OCR specifically, has developed a regulations proposal generally that will identify the compliance standards that will apply to these telecommunications entities.

Mr. WIRTH. If you could speak up, sir. I am not sure that is a microphone. I think you will have to rely on good, natural lung

power.

Mr. MIDDLETON. You will have to excuse me. I have been under the weather quite a bit lately. I will do my best.

Mr. WIRTH. That is the way a lot of us feel, as well.

Mr. MIDDLETON. I was saying that the regulations proposal that we have developed and which has been through the departmental clearance processes proposes to identify compliance standards that will apply to telecommunications entities such as the local broadcast stations, PBS and NPR. The regulation will also establish procedures for carrying out the data collection activities, the processing of discrimination complaints, and procedures for initiating enforcement proceedings in the event voluntary compliance cannot be achieved.

Mr. MARKS. Excuse me a moment.

Mr. Chairman, may I ask a question?
Mr. WIRTH. Yes.

Mr. MARKS. Mr. Middleton, you keep using the word "will."
Mr. MIDDLETON. Yes, sir.

Mr. MARKS. You are using that "will" when?

Mr. MIDDLETON. We expect to get a proposed regulation published for public comment by the end of June of this year.

Mr. MARKS. By the end of June.

Mr. MIDDLETON. Yes, sir.

Mr. MARKS. How long have you been working on it?

Mr. MIDDLETON. For about a month or two.

Mr. MARKS. Does it take 6 months?

Mr. MIDDLETON. Amazingly enough, sir, it does take that long. Mr. MARKS. Thank you.

Mr. MIDDLETON. Finally, the regulation, if it is issued ever, will explain the roles of HEW and the Corporation in monitoring compliance and implementing the standards and procedures which are being developed. During the drafting stage of this regulation, which is already under way, OCR is consulting with the Equal Employment Opportunity Commission, which under Executive Order 12067 has the responsibility to insure that Federal departments and

agencies are enforcing consistent compliance standards in the area of equal employment opportunity.

We will also obtain the views of the Corporation, the FCC, and other interested parties in the development of this regulation to assure that it is sound and practical. As I stated earlier, we expect to get this proposal out for public comment in June. Depending upon the extent of that comment, we expect a final regulation to be issued within a month and a half thereafter.

That concludes my brief statement unless you have some questions.

[Mr. Middleton's prepared statement follows:]

STATEMENT OF MICHAEL A. Middleton, DEPUTY DIRECTOR, OFFICE OF STANDARDS, POLICY AND RESEARCH, Office for Civil RIGHTS, DEPARrtment of HeALTH, EDUCATION, AND WELFARE

Mr. Chairman and members of the subcommittee, we appreciate the opportunity to testify on the Department's plans to enforce the equal employment opportunity provisions of the Public Telecommunications Financing Act of 1978.

The statute amends Section 398 of the Communications Act of 1934 to prohibit employment discrimination and assure equal employment opportunity in public broadcasting on the grounds of race, color, religion, national origin, and sex.

To give effect to this provision, the statute creates a distinct compliance and enforcement mechanism. The Secretary of HEW is directed to issue rules and regulations outlining the nondiscrimination and equal employment opportunity responsibilities of telecommunications entities, including the Public Broadcasting Service and National Public Radio. Based on the Department's regulation and compliance review procedures, the Corporation for Public Broadcasting will initially determine whether a recipient of assistance is affording equal employment opportunity, relying on information furnished by the recipient.

If the Corporation is not satisfied that a recipient is in compliance, HEW will review the case and make a final determination.

Whenever the Department determines that the recipient is violating the equal employment opportunity provisions, the recipient will be given 120 days to either refute the finding or negotiate an acceptable corrective plan. The Secretary of HEW shall direct the Corporation to reduce or suspend payments to the recipient whenever voluntary compliance cannot be achieved.

The first step required by the statute is to develop a regulation. To lay the groundwork, the Office for Civil Rights (OCR) has had discussions with representatives of the Corporation, the Federal Communications Commission, the Equal Employment Opportunity Commission and other interested parties. Through these discussions we have developed an understanding of the public broadcasting field, the employment patterns of the local stations as a group, and existing data collection procedures.

On March 13, OCR published in the Federal Register a public notice announcing our intention to develop a regulation. As indicated in the notice, the regulation will: Identify the compliance standards that will apply to telecommunications entities, such as local broadcasting stations, PBS and NPR; established procedures for carrying out data collection activities, processing discrimination complaints, and initiating enforcement; and explain the roles of HEW and the Corporation in monitoring compliance and implementing the standards and procedures.

We expect to publish a proposed regulation for public comment by the end of June. During the drafting stage, OCR will consult the Equal Employment Opportunity Commission which, under Executive Order 12067, has the responsibility to ensure that Federal departments and agencies are enforcing consistent compliance standards in the equal employment opportunity area. OCR will also obtain the views of the Corporation and of other affected organizations to ensure that the proposed regulation is sound and practical.

In enacting the equal employment opportunity provision, the Congress moved to close the gaps in the enforcement scheme. A single agency-HEW-was assigned the responsibility to monitor compliance in public broadcasting and to focus on the problems that several reports have brought to light. This is an important responsibility and we will do our best to develop and effective compliance program.

Thank you.

Mr. COLLINS. Could we have all of the statements?

Mr. WIRTH. Let's go ahead and do that.

Mr. Fellows.

STATEMENT OF JAMES A. FELLOWS, DIRECTOR, INTERREGIONAL COUNCIL ON PUBLIC TELEVISION POLICY, ACCOMPANIED BY BRUCE CHRISTENSEN AND LAWRENCE FRYMIRE, COCHAIRMEN

Mr. FELLOWS. I am here today with the Interregional Council on Public Television Policy. With me are Mr. Bruce Christensen, the cochair of the council, and Dr. Larry Frymire, who is also a cochair. We have provided a statement to the committee. The statement also includes the composition of the Interregional Council at the present time, which covers, I think, about 23 States across the country.

The Interregional Council is a formal effort on the part of the public television licensees to identify, examine, analyze, and deal with a number of policy issues and problems which they have as public broadcasting stations. It is the specific device that the stations have chosen to use to develop and operate in specific ways, policies that they think will address problems that have been identified through this committee's hearings and which have been identified by the stations themselves.

The council is only about 3 months old, and our effort has been to study policy questions in a manner that will lead to specific action items. We are not looking toward puffy, arrogant policy statements. We are looking toward things stations can actually do in a number of these critical areas.

The council will hold its third meeting later this week, and if these hearings were next week, I could report to you a little more definitively about what would happen. But I think we can constitute this as something of a progress report now to give you an idea of some of the topics under consideration for the council and the kinds of things which will be discussed at that meeting.

The work of the council, Mr. Chairman, has been carried out by six policy groups that have been established in key areas. The policy groups are licensee based and it is the licensees who really carry out this work. They do not have an elaborate staff in Washington that works for them. They work for themselves.

I think it would be appropriate for me to turn over this part of the presentation to Mr. Christensen and Dr. Frymire to report on these six areas and summarize our report. Dr. Frymire will report on the work being undertaken in EEO, access by independent producers and fundraising and underwriting practices, and Mr. Christensen will report on the work being undertaken on financial reporting and accountability and technology and systems structure. Mr. FRYMIRE. Mr. Chairman, I am Lawrence Frymire from the New Jersey Public Broadcasting Authority, and cochairman of the Interregional Council. I appreciate the opportunity to share this platform with you and with Mr. Fellows.

Very briefly, the three areas I would report on are three essential items that have surfaced during the course of hearings and thoughtful negotiations and discussions over the past year or two as essential areas in which public broadcasting should show prog