That rule was effectively overturned with the release of FCC 12-29 the fourth report and order and the third order of consideration on translators and the creation of a Low Power Radio Service(No I'm not maiking this up) dated March 19th 2012.
I beleive ALL translators are now legal for AM use (Or will be after publishing in the federal register. + 30 days yada yada yada) I would suspect an STA would be granted now just like when they started AM on FM a few years ago.
They didn't go quite that far. (which surprises me)
FM translators which are already authorized, or whose applications were on file by May 1, 2009
, may be used to relay AM stations.
Now, since they haven't accepted any translator applications since 2003, that does in effect mean any translators currently "in the hopper" will be able to relay AM. However, if they hold a future translator window, those translators won't have that opportunity.
Unless the FCC changes their mind again, which I think is quite likely.http://www.fcc.gov/document/lpfm-fourth-report-and-order-and-third-order-reconsideration
A couple of winters ago, KGA in Spokane was operating non-directional at night. In hopes of landing a rare state at my location near Nashville, I spent a LOT of time DXing 1510.
By far the major source of interference was this Canton station. It may be a daytimer but it sure wasn't acting that way.
(I did eventually log KGA anyway)