FCC ownership cap vote heads to August meeting amid legal doubts, congressional skepticism

The FCC plans to vote during its August meeting on replacing its 39% national television ownership cap with a case-by-case public interest review, a move that would remove the only federal limit on how many households a single broadcast company can reach — and one that faces opposition from the Republican chairman of the Senate Commerce Committee.

“A vote to eliminate this cap next month would be unlawful on its face and certain to face court challenge,” Commissioner Anna Gomez said at a press conference following the commission’s July 22, 2026, open meeting. “Congress set the cap at 39% in 2004, and it did so deliberately. It is not a commission rule. It’s a statute, and only Congress has the authority to change it.”

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Chairman Brendan Carr defended the proposal during the same press conference, framing it as necessary to help local broadcasters compete against national programmers that now reach audiences through streaming services, apps and virtual cable platforms without comparable restrictions.

“National programmers can distribute their programming to 100% of the country, either through their own streaming services or through deals they cut with nationwide virtual cable companies like YouTube TV,” Carr said. “The cap no longer constrains their control over distribution in this respect.”

He added: “But the 39 percent cap continues to apply uniquely to the owners of local broadcast TV stations, forcing the market out of balance.”

The legal dispute

The question of whether the FCC has the authority to change the cap at all has divided even Republicans. Sen. Ted Cruz, the Republican chairman of the Senate Commerce Committee, said he is “skeptical this change can be made without an act of Congress.” Carr acknowledged at the July press conference that he is in regular contact with Cruz’s team but pushed back on the legal argument.

Carr cited a prior D.C. Circuit ruling in which the FCC had argued it lacked authority to modify the cap. The court disagreed, Carr said, finding that 39% was “merely a starting point.” He argued that subsequent statutory changes did not eliminate the commission’s authority to adjust the rule.

“Even when that position had been deferred to, the court overruled it,” Carr said, referring to the pre-Chevron era. “So I think that’s instructive as to how the court would address this in a post-Chevron world.”

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Gomez was unconvinced. She pointed to the 2004 Consolidated Appropriations Act, which wrote the 39% figure into law, exempted it from the FCC’s quadrennial review of media ownership rules and specified that the commission could not forbear from enforcing it.

“It specifically said we can’t forbear from enforcing it, and it removed it from consideration in the quadrennial review,” Gomez said. “So it in multiple places basically said, ‘Don’t touch this cap.'”

The proposal would most immediately affect Nexstar Media Group and Sinclair, two of the largest U.S. station group operators. Both companies have long advocated for relaxing the cap.

The FCC’s Media Bureau earlier this year waived the cap to approve the $6.2 billion Nexstar-Tegna merger, which would give the combined company 259 stations reaching roughly 80% of television households. A federal judge in April issued a preliminary injunction blocking the deal on antitrust grounds, finding that DirecTV and eight state attorneys general challenging the merger were likely to succeed in their claim that it would reduce competition and raise retransmission fees.

Gomez cited the injunction as evidence that the commission’s deregulatory approach was already backfiring.

“When this commission waved the cap to push through the unlawful Nexstar-Tegna merger, a federal judge stepped in and issued a preliminary injunction, finding that the states and DirecTV are likely to succeed in the deal violates antitrust law,” Gomez said. “That is a court telling this commission in plain terms that this kind of consolidation harms competition and harms consumers.”

The newspaper comparison

Carr has drawn a parallel between broadcast television and the newspaper industry, arguing that the FCC maintained a similar investment restriction on newspapers for more than 40 years before eliminating it in 2017.

“Meanwhile, local newspapers shut down by the dozen, and many Americans are now left to choose from a small number of national papers,” Carr wrote in a Breitbart op-ed published July 15. “We can’t let local broadcast TV follow the same path.”

Gomez turned the analogy against him.

“Newspapers are not a model to follow,” she said. “They are a warning. Between 2004 and 2020, the largest newspaper chains grew their share of the industry from under a third to 70%. Over that same stretch, the country lost more than 3,300 newspapers and roughly 1,600 independent owners. Consolidation did not save that industry. It picked apart what was left of it while the industry itself collapsed.”

Data from Northwestern University’s Local News Initiative and the University of North Carolina’s news desert research supports the broad strokes of Gomez’s argument. Since 2004, roughly 2,100 newspapers have closed and the number of newspaper owners has dropped from approximately 4,000 to 2,400, according to the UNC research. Nearly 1,800 communities that had at least one newspaper now have none.

Case-by-case or blank check

Under the proposed rules, the FCC would not eliminate ownership limits outright. Instead, transactions that would push a company past 39% of national television household reach would be subject to public interest review, with the commission evaluating each deal individually.

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“There may be transactions that would have exceeded the limits of the 39% national cap that do not promote the public interest and those will be denied,” the FCC said in a statement announcing the August vote.

Gomez expressed concern that the case-by-case framework would give the commission discretion to treat different broadcasters differently depending on their relationship with the administration.

“It does open the door to treatment of different broadcasters differently depending on who their owners are,” she said at her July press conference.

She proposed a market-by-market approach as an alternative, arguing that the commission should evaluate local competitive conditions rather than applying blanket deregulation.

“I don’t like just wholesale deregulation. I don’t think that serves the local communities very well,” Gomez said. “But I do think that we need to look at it from a market-by-market basis because of the fact that we need to understand the changes in the economics and we want to make sure that we have voices representing those communities.”

The commission’s August meeting is scheduled for Aug. 6. Carr and Commissioner Olivia Trusty are expected to vote in favor. Gomez has signaled she will dissent.