What Every Station Should Know About Political Advertising

1
What Every Station Should Know About Political
Advertising
2
Whats New

• Petition for Declaratory Ruling
• - Named State Broadcasters
• - Google/dMarc, Bid4Spots and Softwave Media
  Exchange
• - Interim?

3
Wisconsin Right to Life

• June 15, 2007 Supreme Court Decision FEC vs.
  Wisconsin Right to Life, Inc.
• Loosened restrictions on TV and Radio ads that
  corporations and labor unions can finance prior
  to an election
• No Other Reasonable Interpretation Standard
• Redefines Electioneering Communications

4
Electioneering Communications

• Electioneering communications are any broadcast,
  cable or satellite programming that refer to a
  federal candidate, are aired within 60 days prior
  to a general election or within 30 days prior to
  a primary election and reach 50,000 or more
  persons.
• What this means for stations

5
Refresher Course

• Reasonable Access
• Equal Opportunities
• Lowest Unit Charge
• Sponsorship ID and BCRA
• Public File

6
Reasonable Access

• Stations must sell time to federal candidates
• Applies during the entire campaign
• Stations cannot set up front limits on the
  amounts or type of time that candidates can buy
• But, stations may reject unreasonable requests
  and negotiate with candidates

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Carter-Mondale Factors
Reasonable access requests must be evaluated
using 4 factors

• How much time the candidate has already bought
• The amount of disruption the buy would create
• The potential for equal opportunities demands
  from other candidates
• The timing of the request

8
State Local Candidates

• State and local candidates have no right of
  access
• Stations may exclude some or all state and local
  candidate ads

9
State Local Candidates

• Stations can take ads from some races and not
  others
• Stations can limit the number of ads
• Stations can restrict the dayparts for state and
  local ads
• But, stations must make discount classes
  available and equal opportunities and lowest unit
  charge rules apply

10
Equal Opportunities

• Does not require equal time, just equal right
  (i.e., pay for pay and free for free)
• Triggered by any non-exempt use
• Applies only to candidates in the same race
• Candidates must request equal opportunities
  within 7 days

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What type of programs are exempt?

• Bona fide newscasts
• Bona fide news interview programs
• Bona fide documentaries
• On-the-spot coverage of bona fide news events
  includes station-sponsored debates and some free
  time offers

12
Political Rates

• Apply to all races federal, state and local
• Issue ads do not receive political rates
• Party ads are only entitled to political rates if
  the party is one of the candidates authorized
  committees
• - if a party or other ad supporting a
  candidate is an independent expenditure,
  political rates are not required

13
Lowest Unit Charge

• Since 1991, the most important requirement is
  disclosure
• A stations political rates are determined by the
  rates it offers commercial advertisers
• Stations must tell candidates about all relevant
  information and rates offered to commercial
  advertisers

14
Disclosure Statement

• Stations should have a written disclosure
  statement
• It should be given to every candidate or agency
  requesting political time
• Dont just copy the disclosure statement you used
  last election check to see if it still
  accurately describes your sales practices

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What to Include in Calculating the LUC

• All paid spots
• All contracts in effect during the political
  window or available to commercial advertisers
• Paid PSAs which are aired for commercial
  advertisers
• The value of bonus spots must be included in
  the LUC this includes bonus spots that air
  outside the window

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What to Exclude from the LUC

• Spots for which no payment is received
• Pure barter spots
• Per-inquiry spots
• Bonuses for non-profit organizations and the
  government
• De minimis value-added incentives or incentives
  that would imply a station endorsement

17
Packages

• Candidates do not have to buy a package to
  benefit from the package rate
• Every spot in every package must be valued
• Package prices may be allocated on the contract
  or in a signed and dated internal memo
• If a station does not allocate, FCC will assume
  all spots have an equal value

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Calculating the LUC Incentives

• Non-cash merchandise and promotional incentives
  do not have to be factored into the LUC
• They must be offered to candidates on the same
  basis as to commercial advertisers
• Incentives of de minimis value or which imply
  endorsement do not have to be offered to
  candidates

19
Preemptible Time

• Stations which offer commercial advertisers
  separate levels of preemptible time may treat
  each level as a separate class
• Stations may offer candidates fixed time so
  long as that class is offered to commercial
  advertisers
• Stations which sell time on an auction basis have
  only one class of preemptible time

20
Candidate-Only Discount Class

• Stations may create a non-preemptible class of
  time for candidates only
• If occasional spots clear below the candidate
  discount rate, no rebate is required

21
Changes in Rates

• If a contract with a commercial advertiser
  expires during the window, the LUC may change
• Rate changes which are part of a stations
  ordinary business practices will affect the LUC
• Rates may vary due to changed ratings, seasonal
  demand, etc.

22
Issue Ads

• Do not qualify for political rates
• Stations are liable for defamation and may censor
  
• Must have sponsor ID
• No requirement to offer or give time to opponents

23
Issue Ads

• Public file must show that station aired ads
• May have to show date and times aired and rates
  if the ad includes a message relating to any
  political matter of national importance
• Must include a list of officers, directors, or
  committee members of sponsoring organization
• Stations should be careful about misleading
  sponsor identifications

24
Sponsor Identification

• All spots must have a sponsor ID
• The ID must state that the ad is paid for or
  sponsored by the entity actually paying for the
  time
• Candidate spots paid for by someone other than
  the candidate must state whether they are
  authorized by the candidate
• Ads for federal candidates that refer to
  opponents have new BCRA ID requirements

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Sponsor Identification

• If a spot comes in without an FCC-required ID,
  the station must add it to the spot
• A station-added ID may obliterate part of the ad
• A spot that arrives without an ID may be aired
  once without penalty the ID must be inserted
  for all subsequent airings

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Sponsor Identification TV

• TV political spots must have a visual sponsor ID
• It must air for at least 4 seconds
• The ID must be in letters equal to 4 of the
  screen height or 20 scan lines
• BCRA added additional requirements, particularly
  for ads that refer to opponents

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Speaking of BCRA

• Bipartisan Campaign Reform Act
• All significant provisions upheld by Supreme
  Court in December 2003
• Many provisions apply to candidates stations
  are not obliged to enforce them
• FCC will not adopt new rules will not punish
  broadcasters who exercise good faith discretion

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Stand by Your Ad

• To obtain the LUC, federal candidates or their
  authorized committees must certify in writing to
  stations that
• the political programming they will air does not
  contain a reference to an opposing candidate, OR
• if there is a reference to an opposing candidate,
  the spots will contain additional disclosures

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Example- Ref. Opposition But Not Advocating
Election/Defeat (Radio)

• At the end of the programming, an audio statement
  by the candidate identifying him or herself, the
  office being sought and that the candidate
  approved the broadcast
• Sponsor ID Chart

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Stand by Your Ad

• Does it have to be a negative reference?
• How often should candidates certify?
• BCRA says at the time of purchase
• NAB suggests obtaining a certification for each
  buy
• Do stations have to check the accuracy of
  candidate certifications?

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What Happens if a Candidate Doesnt Certify?

• Loses LUC for the remainder of the campaign
• FCC staff says that if a candidate loses the LUC
  for the primary, he/she can get it back for the
  election
• FEC Deadlock
• BCRA suggests that candidates would lose the LUC
  on all stations, but no way to enforce that

32
Political File

• Important because this is the only source of
  information for candidates about their
  oppositions appearances
• Stations may not respond to blind requests for
  avails or time
• FCC excludes political file from telephone access
  rule and new enhanced disclosure rule

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Political File Must Include

• All requests for time (but not simple rate
  inquiries)
• The nature and disposition of the request (i.e.,
  how did the station respond?)
• The rates charged
• The dates and times spots aired
• Any other non-exempt uses

34
Political File

• Information must be placed in the file as soon
  as possible
• Stations may provide exact times when spots aired
  upon request
• Stations must keep information in the political
  file for 2 years

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Resources

• NAB Members can call the NAB Legal Hotline at 866
  682 0276
• Be Sure to Utilize Your Station Counsel
• PB-16 and Political Broadcast Catechism are
  available at www.nabstore.com