A confluence of factors in the 1990s, including a court case invalidating the commission's comparative criteria as arbitrary and capricious; an increased workload that had already led to the implementation of lotteries in certain fields in telecommunications and low-power television; and a desire to reduce the federal budget deficit, led to the FCC ultimately being required by Congress in the Balanced Budget Act of 1997 to auction off broadcast and other licenses to the highest bidder.
[2]: 496 In September 1983, two years after being authorized,[1]: 532 the first low-power TV license lottery was held to select 23 station licensees, with minority-owned applicants given greater weight.
[1]: 530 On December 20, 1993, a federal appeals court ruled in Bechtel v. FCC that a longstanding comparative criterion, which favored the integration of ownership and management, was arbitrary and capricious.
[6][7] The freeze had an impact on new television networks, such as The WB, that were counting on the commission to approve new stations in varying areas of the United States.
When no settlement was held in the 11-year battle, for which an initial winning applicant had already started a station under temporary authority, had it rescinded and then restored, it was sent to auction among five remaining parties.