Dear Senator:
I write to you as a retired employee of New Jersey Public Broadcasting Authority, (NJN) having served there for 27 years including 10 years in management. I write in opposition to any privatizing plan for NJN that would transfer the FCC broadcast licenses out of state control.
In the 1960’s, Governor Hughes commissioned a study of television coverage in New Jersey. At the time, and to this day, most TV coverage in the state comes from stations located and licensed to communities outside of New Jersey. Then, as now, New Jersey is largely neglected by these stations. Programming from these “foreign” stations, largely located in New York and Philadelphia, fails to address the unique needs of New Jersey and its people. Governor Hughes’s report concluded that there was a need for New Jersey based television coverage. The Legislature’s creation of the New Jersey Public Broadcasting Authority NJN was the outgrowth of that study.
Other states have privatized their Public Television entities however New Jersey is in a very different situation than any of these other states. These other states have viable commercial television stations within their respective states that do address the needs of their residents. As I mentioned above, this is not the case in New Jersey. All of the best and certainly most of the commercial TV Licenses were issued long ago to New York and Philadelphia. Even the few New Jersey commercial TV stations licensed within the state cater to these two large cities and seek to tap into their financial benefits.
The Legislature has made a significant investment in NJN over the past 40 years. I believe this has been a wise and prudent investment. To be sure it has guarantied that New Jersey’s citizens can get TV coverage for and about them.
Letting go of these valuable FCC broadcast licenses is absolutely the wrong thing for the state to do. Once out of the states hands these licenses are lost forever. They can be bought and sold to any number of other entities. The argument is often made that the licenses have little value since they are reserved by the FCC for Public TV use only. That is not necessarily the case. The FCC in the last ten years permitted the conversion of a public TV station in Pittsburg to commercial status and that station was sold for millions of dollars ($165 million I believe). Can you imagine the value of such a conversion in New Jersey which falls in the New York and Philadelphia First and Fourth Neilson TV Markets? What a tragic loss that would be in dollars to the citizens of New Jersey. Simply stated, any privatization of NJN should be done at fair market value where the state can recover the maximum value of its assets. The City of New York did this when they privatized their Public Radio station a number of years ago. I recall that the radio station was sold by the city to its own foundation for some 20 million dollars. One can only imagine the value of NJN. Remember though that the real significant value is in the FCC Licenses and not the physical assets themselves.
The NJN Foundation is not the best choice for privatization either. Over my time at NJN I watched the Foundation grow and consume its resources to a far greater degree that it was supposed to do. The NJN Foundation was supposed to raise funds and awareness for NJN. Instead it has withheld millions of dollars from the operation of the network. Were not these funds raised for the network?
During my time at NJN I wrote the federal matching grants for the conversion of NJN to Digital TV (DTV). The match for these funds came from state appropriations. I do not recall any funds for DTV conversion coming from the NJN Foundation and yet DTV conversion has been the single largest cost in the TV industry in this country for the past 10 years. All the while the Foundation maintained balances in its accounts of several million dollars.
Even if the State wishes to privatize NJN, it should retain the FCC licensees and hence ultimate oversight of NJN for no other reason than to insure that New Jersey continues to get TV service that is relevant to the state. Any privatized entity will surely follow sources of funding in order to be viable. I believe that the majority of such funding would come from New York and Philadelphia. Over time the TV programming would obviously shift to serve those constituencies leaving New Jersey where it was in the mid 1960’s when it comes to real TV services.
NJN is uniquely “New Jersey” because it is owned by the state. Perhaps the wiser course of action would be to give NJN the type of latitude and freedom from state regulations that the Sports & Exposition Authority enjoys.
NJN has certain assets that include EBS licenses (Educational Broadband Service) and DTV multicasting capabilities over its TV channels that can be leased for significant dollars thereby freeing up the need for large state appropriations. Leasing of the EBS licenses alone would generate several million dollars per year in revenue to NJN. When I was preparing to retire last fall, significant offers, in the tens of millions of dollars, were being made by wireless companies to lease these EBS licenses from NJN. State regulations hamper the ability of NJN to do so. These regulations should be changed with regard to NJN in order that it may further reduce its dependence on state appropriations.
Senator, please do not let the privatization of NJN happen to the people of New Jersey. I remember with pride my service to the people of New Jersey for over a quarter of a century. I remember traveling from one end of the state to the other as part of my work for NJN. I remember setting up equipment to broadcast from many places throughout the state over the years. I even remember being sent to your campaign headquarters as an engineer to cover your victory Live on NJN in November of 1993. Television like this can only happen when the station owner (in this case the State and its People) make it happen.
Best Regards,
Charles W. Loughery
