Gray TV Buying Back Rapid City Station It Divested in 2016

Gray TV is buying back a Rapid City TV station that it divested five years ago, a move possible because the station no longer ranks in the top four.

An asset purchase agreement filed with the FCC says Gray will pay Sherry Nelson’s Legacy Broadcasting of Rapid City $500,000 for MeTV affiliate KHME/23.1 (RF 2, Rapid City) and its satellite, KQME/5.1 (RF 10, Lead). Legacy had purchased the stations in 2016 for $1.

The application to transfer the stations’ licenses states that Gray ABC affiliate KOTA-TV/3.1 (RF 7, Rapid City) is currently ranked #1 in the market and that KHME does not rank in the top four. Current ownership rules allow duopolies as long as only one of the stations is in the top four.

The application requests a continuation of a waiver to allow KQME to operate as a satellite of KHME.

KHME is actually the original KOTA-TV license (facility ID 17688), which Gray TV bought and immediately divested in 2016 because it already owned full-power FOX affiliate KEVN/7. Gray retained KOTA-TV’s callsign, ABC affiliation, and virtual channel by moving the callsign and network to the former KEVN (RF 7) license and moving the KEVN callsign and FOX to a low-power TV station on RF channel 23. It conducted a virtual channel swap mapping channel 3.1 to RF 7, channel 7.1 to RF 23, and channel 23.1 to RF 2. KOTA-TV was later moved into the existing KEVN building on Skyline Drive.

(Low-power TV stations such as KEVN-LD do not count towards ownership caps, even if they carry major networks.)

After adding KHME into the fold, current FCC regulations will not allow Gray to move one of the major networks to the KHME license because it would create a duopoly of two full-power, top-four stations. The station qualifies for must-carry status on cable and satellite since it is a full-power license, giving Gray a third market-wide channel.

KHME has a UHF translator on channel 18 in Rapid City, helping to alleviate reception problems known to exist for stations transmitting on VHF Low channels like KHME.

KHME and KQME also carry H&I, Start TV, and Decades on subchannels.

The other full-power stations in the Rapid City market are locally-owned NBC affiliate KNBN/21.1, Nexstar CBS affiliate KCLO/15.1 (which is a satellite of KELO-TV Sioux Falls), and several stations owned by South Dakota Public Broadcasting. KOTA-TV also has full-power satellite KHSD/11.1 (RF 10, Lead).

This is not the first time Gray has re-purchased a station that it had divested: In a 2019 deal with Legacy Broadcasting, it bought KNHL/5 (Hastings, NE) , which Gray now uses as a satellite of its other stations in the market.

Gray is the dominant TV station owner in the region with stations in 19 of 22 Upper Midwest markets, including all of the markets in South Dakota, North Dakota, and Nebraska.