Ethical questions raised by Gene Stipe deal

Monday, March 21st 2005, 10:22 am

By: News On 6

WILBURTON, Okla. (AP) _ In a deal raising ethical questions, $300,000 in state-appropriated money built and equipped a studio for a radio station former state Sen. Gene Stipe started at Eastern Oklahoma State College in 2002, The Oklahoman reported Monday.

Stipe resigned amid scandal in March 2003 from the state Senate seat he first won in 1956. A month later he pleaded guilty to federal conspiracy and perjury charges in a scheme to illegally fund a congressional campaign.

Ethics rules and a state constitutional provision are aimed at preventing lawmakers from doing business with the state.

Stipe sold the Wilburton station, KESC-FM, and four McAlester stations for $2.2 million in a deal the Federal Communication Commission's Media Bureau approved Jan. 18. But the FCC has said it will review and may undo the deal.

The FCC wants to consider whether Stipe should have been required to forfeit the licenses, rather than profit from their sale, after his guilty plea. Airwaves are considered a public asset and license holders are required to meet a character test to obtain and maintain their broadcast licenses.

Meanwhile, the station's new owners, including state Sen. Richard Lerblance, who succeeded Stipe in office, have upset Wilburton residents, filing an FCC application to move the Wilburton station to Okemah. If the move goes through, the college would be left with a radio studio but no license to broadcast.

Records show Stipe's Little Dixie Radio corporation obtained its FCC license for the station in 2002 after working out a deal that called for the college to build and equip the broadcast studio.

The college was to gain by having educational opportunities available to students interested in radio broadcasting. Stipe's company was to gain by not having to pay for the broadcasting equipment and studio, receiving some free student labor, and receiving the profits from the station's operation.

An assistant attorney general who reviewed the contract was not told Stipe was the owner of Little Dixie Radio and was not asked to look into the ethics or legality of a state lawmaker benefiting financially from appropriations the Legislature approved, said Charlie Price, a spokesman for the attorney general's office.