Senate Majority Leader Bob Dole (R- Kans.) March 7 questioned the merits of an FCC program that would allow Viacom to defer millions in taxes by selling its cable TV systems to a partnership headed by Sacramento-based black business-man Frank Washington.
Dole’s comments came as the Senate Finance Committee began exploring legislation passed by the House of Representatives that would kill an FCC tax certificate program designed to increase minority ownership in the media. The House bill was also designed to retroactively kill Viacom’s planned $2.3 billion cable system sale to Washington and cable giants Tele-Communications Inc. and Intermedia Partners.
“Even though I sympathize with the goals (of minority ownership of broadcast and cable properties), I can’t sympathize with somebody walking off with a half a billion dollars,” Dole said, referring to Viacom’s plans to defer more than $400 million in taxes through its cable system sale.
Other lawmakers on the panel chaired by Sen. Bob Packwood (R-Ore.) were leery of applying tax law retroactively to thwart the Viacom deal. Senators Alfonse D’Amato (R-N.Y.), Alan Simpson (R-Wyo.) and Orrin Hatch (R-Utah) all questioned the fairness of singling out Viacom for punishment.
Packwood said he hopes to hold a vote in his committee this week, and that the “overwhelming evidence” suggests minority owners of broadcast and cable properties offer programming that is distinctly different than that offered on white-owned media outlets. The issue, he said, is whether Congress should encourage ethnic diversity of broadcast and cable ownership.