News-rack law again delayed
Supervisors look for ways to void deal with media giant

By Tali Woodward

With some members expressing concern over signing a 20-year contract with a notorious media giant, the San Francisco Board of Supervisors again delayed action April 29 on the deal that would hand over newspaper distribution in the most congested parts of the city to Clear Channel Communications. The delay gave opponents of the deal some hope that the contract can still be defeated.

The contract was originally approved by the board in 1999, as part of a plan to eliminate freestanding news racks and replace them with pedestal-mounted distribution centers. Clear Channel won the contract to build the so-called pedmounts, half of which could have lighted billboards on the back.

But nine newspaper publishers who distribute in San Francisco sued to stop the plan. The publishers – including the Bay Guardian – have signed off on a settlement deal that preserves freestanding racks in some areas of the city. As part of the settlement, the city negotiated some changes to the Clear Channel contract.

Now the board is exploring whether it can void the entire news-rack deal.

"There are clearly a lot of issues that the first round didn't get into," Sup. Matt Gonzalez said at the meeting. Acknowledging some public concern about freestanding racks, he asked, "Do you really want to replace that with advertising lighted up at night?"

Sups. Aaron Peskin and Tom Ammiano, while expressing displeasure with the contract, said they are inclined to approve it in order to protect the city's financial interests.

Gonzalez urged the board to postpone voting on the three-piece legislative package until it can meet in closed session with the city attorney. "Why can't we use the constitutional arguments [raised in the publishers' lawsuit] as a way to get out of the contract?" he asked. The board then voted 10-1 – with only Sup. Leland Yee dissenting – to schedule that discussion May 6.

"At least they didn't pass it today," said Jeff Perlstein, executive director of Media Alliance, the San Francisco nonprofit that is organizing opposition to the Clear Channel deal. "The cost [of the deal] is extraordinary," he told us. "You're trading in your democracy to have a slightly more orderly sidewalk."

Peskin first delayed consideration of the deal April 22, when he asked board budget analyst Harvey Rose to update his 1998 report on the contract. Rose's report, released April 26, presents without challenge the city attorney's position that "if the lawsuit is not settled and the City does not prevail in court, the City could be liable for up to an estimated $3.4 million in attorney's fees." But it's worth noting that, under the settlement, the publishers have agreed to accept only $85,000 in legal fees from the city. The report does not delve into Clear Channel's ownership of other media in San Francisco or the expansion of the company's empire nationwide since the original contract was signed. And it raises no real concerns over the fact that Clear Channel can back out of the 20-year deal fairly easily, even though the city can't.

Perlstein, like other critics of the deal, is particularly concerned that Clear Channel, which owns seven radio stations and hundreds of billboards in San Francisco and also runs 19 TV stations and much of the country's concert business, will control the pedmounts. He said the city is looking at "opening the gate for Clear Channel to dominate another medium, when they've used terrible anticompetitive tactics that have resulted in the destruction of local and independent media across the country."

Since the Telecommunications Act of 1996 greatly loosened federal regulation of media ownership, Clear Channel has grown into a monster-size media company. Before then-president Bill Clinton signed the law, a single company was prohibited from owning more than 40 U.S. radio stations. Clear Channel now controls more than 1,200 – six times the number of stations owned by the next-largest radio chain.

Clear Channel is trying to get Federal Communication Commission clearance for a plan to take over the Ackerley Group, which, like Clear Channel, operates TV stations, radio stations, and billboards throughout the United States. Eight of Ackerley's TV stations are in California, including two – KCBA and KION – in Monterey. U.S. Rep. Sam Farr (D-Monterey) has written the FCC to urge that Clear Channel's request be denied. Residents of Monterey fear the company will continue the cost-cutting that has earned it the moniker "Cheap Channel" and has prompted cries of homogenization from radio professionals and music industry representatives.

The American Federation of Television and Radio Artists specifically cited Clear Channel in a legal brief it filed with the FCC in April. Consolidation, the brief said, "has harmed the public interest by reducing diversity and competition in local radio markets" to the point that "there is concern both the radio and sound recordings industries have been forever transformed and destroyed."

For more stories and links to information about Clear Channel and the news-rack debate, please see:
Clear and present danger 04.24.02

A press conference and rally organized by Media Alliance that focuses on the news-rack deal takes place Mon/6, noon, steps of City Hall, 1 Dr. Carlton B. Goodlett Place, S.F. For more information on protesting the deal, go to www.media-alliance.org. E-mail Tali Woodward at tali@sfbg.com