Last updated: February 21, 2008 - 11:08am
MINORITY TAX CERTIFICATES POISED FOR RETURN?
[SOURCE: tvnewsday, AUTHOR: Kim McAvoy]
From nearly 20 years, from 1978 to 1995, the minority tax certificate was the most popular and effective tool for increasing the ranks of minority TV and radio station owners. But the certificate may have been too much of a good thing. Some of the minority buyers turned out to be fronts for non-minorities, and the amounts of the deferred taxes start running into some serious money. In 1995, Viacom announced that it was selling its cable systems to an investment group headed by Frank Washington for $2.3 billion and that, because Washington was black, it would defer as much as $400 million using the tax certificate, even though Washington had only a small amount of his own money in the deal. Such excesses coupled with a new Republican majority in Congress skeptical of race-based programs led to Congress killing the certificate in 1995. Now, with Democrats back in control of Congress and broadcasters seeing increased minority and female ownership as a pre-condition of relaxing broadcast ownership rules, there is renewed hope and interest in resurrecting the tax certificate on Capitol Hill. The program was a “win-win for both sides and we need to reinstitute that,” says Henry Rivera, chairman of the Minority Media and telecommunications Council and chairman and of the FCC’s Advisory Committee on Diversity for Communications in the Digital Age.
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