If the initial excitement you feel at the prospect of what will hopefully be another bountiful political advertising market quickly gives way to a sick, uneasy feeling as you try to recall the FCC’s rather complex, and often confusing, political broadcasting rules, then this “update” is for you. Although there haven’t been any significant changes to the FCC’s political advertising requirements, this high-level refresher guide will quickly bring you up to speed on the basics of what you used to know and what you need to know to handle the new political season.
To be clear, this guide just covers the basics and is by no means comprehensive; but it should serve as a useful resource to help you spot the key issues and ask the right questions. In that regard, we strongly recommend that all station staff handling political buys and/or maintaining the political file take some time to brush up on the key rules governing political broadcasting, as summarized below.
Although the FCC’s core political advertising requirements haven’t changed since our last guide, we’ve updated the guide with some practical tips for compliance. Notably, we call your attention to the fact that because stations’ political files are now available online for all to see, diligent compliance with the FCC’s recordkeeping requirements is critical, especially now that we’re in the midst of the license renewal process.
The following guide follows a simple Q&A format, and is split into two sections. The first section covers “candidate ads” – i.e., those sponsored by candidates (or their authorized campaign committees). The second section covers “third-party ads” – i.e., those that are sponsored by – you guessed it – a third party, such as an independent political action committee, a political party, a corporation or an advocacy group.
WHAT TYPES OF SPOTS/PROGRAMS TRIGGER THE FCC’S POLITICAL BROADCASTING RULES?
The FCC’s political broadcasting rules – e.g., reasonable access, lowest unit rate, equal opportunities, etc. – generally come into play only when a spot or program involves a candidate “use.” A candidate “use” is any appearance by a candidate – by identifiable voice or picture – that is positive in nature – regardless of what the candidate talks about. A typical “use” would be a candidate’s spot advocating his or her election; however, a “use” could also be a candidate’s positive appearance in, say, a local charity telethon or an old movie (think Ronald Reagan in “Bedtime for Bonzo”).
Keep in mind, however, that the FCC’s rules only apply to “legally qualified candidates” who have fulfilled all of the requirements to run for a particular office. Whether a candidate is legally qualified is usually pretty obvious; however, if you’re not sure, it’s okay to ask for proof. It is up to the candidate, not the station, to demonstrate that he or she meets the candidate requirements under applicable federal, state or local law.
HOW MUCH TIME DO I HAVE TO SELL TO CANDIDATES?
Federal candidates – i.e., candidates for President, Vice President, U.S. Senate, and U.S. House of Representatives – are entitled to “reasonable access” to buy spots on broadcast stations. Stations must sell time to federal candidates throughout their campaign and cannot set any predetermined limits on the spot inventory made available to federal candidates. The only exception is that stations can exclude federal candidate spots from news programs.
State and local candidates, on the other hand, do not have any right of access. Accordingly, stations can set limits on their inventory and/or accept ads only for certain races; or decline ads altogether. However, if you accept one candidate, you must treat all other candidates in the same race evenhandedly. Also, remember that if you afford time to state and local candidates, all other political rules apply, including lowest unit rate and equal opportunities obligations.
WHAT IS THE LOWEST UNIT RATE AND WHEN DOES IT APPLY?
During the 45-day period preceding a primary, primary run-off or caucus election and the 60-day period preceding a general or special election, all spots sold to candidates must be provided at the station’s “lowest unit rate.” The lowest unit rate (or LUR) is the amount that is offered or charged to the station’s most preferred commercial advertiser for the same class (e.g., immediately preemptible spot) and amount of time (e.g., 30 seconds) for the same period (e.g., 11:00 news or morning drive time). Outside the applicable LUR windows, stations can charge “comparable rates” charged other similarly-situated commercial advertisers.
Remember that the LUR does not apply to third-party ads or Internet advertising. The LUR only applies to authorized candidate “uses.” If necessary, you can request that the party buying the ad provide you with documentation confirming that the spot is authorized by the candidate.
HOW DO I VALUE SPOTS IN A PACKAGE, LONG-TERM OR BONUS BUY DEAL?
Spots sold in package plans, long-term contracts or bonus buy deals must be counted in the LUR calculation for relevant time periods even if the candidate does not choose to purchase a similar package plan. Candidates cannot be subject to volume purchase requirements and are permitted to “cherry pick” among the various components of the deal. This is the case with respect to multi-platform packages that stations increasingly are offering to advertisers, which may consist of spots on a station’s primary channel, one or more multicast channels and the station’s website. During LUR windows, candidates may choose among the various parts of such packages and cannot be required to purchase spots on any particular platform.
So what is a station to do? At the time the sales contract is entered, the station should create a separate internal memo that allocates the “true values” of each spot in the package, long-term contract or bonus buy deal (such that those spots with more value are accorded a higher rate), and these values (rather than the rates shown on the face of the contract) will be used to calculate the LUR for each individual component of the deal. This memo should not be placed in the station’s public file, but simply retained in its internal files for future reference.
And there’s one very important thing to remember when assigning values to bonus spots: THE VALUE OF BONUS SPOTS IS NOT ZERO! Rather, the station should use its reasonable, good faith discretion to allocate a portion of the contract price to the bonus ads. That value must be taken into account when determining the value of each spot that is part of the overall contract. For example, if a station charges $100 for 10 morning drive spots, and throws in 2 “free” overnight spots as a bonus, unless the station allocates separate values to the spots, the FCC will consider all of the spots to be equal (i.e., each of the 12 spots purchased for $100 would be valued at $8.33), thus decreasing the value of the morning drive spots for LUR purposes – which you would likely want to avoid.
HOW DOES THE BI-PARTISAN CAMPAIGN REFORM ACT (BCRA) AFFECT THE LOWEST UNIT RATE?
Under BCRA, to obtain the LUR, federal candidates must certify in writing to the station that (i) the spots they will air do not contain a reference to an opposing candidate or (ii) if there is such a reference, the spots will include the following additional disclosure:
- For TV: For at least 4 seconds at the end of the spot, a clear image of the candidate and a clearly readable printed statement identifying the candidate, stating that the candidate approved the spot and that the candidate or an authorized committee paid for the spot.
- For radio: An audio statement by the candidate identifying himself/herself and the office sought, indicating that the candidate has approved the broadcast.
If you run into a candidate who doesn’t meet the above requirements, you must still air the non-compliant spot; however, you have a few options for dealing with the situation, so we advise you to promptly consult your attorneys.
BCRA also requires that federal candidate-sponsored ads include so-called “Stand By Your Ad” disclosures – e.g., “I’m Joe Candidate and I approved this message” – whether or not the spot mentions an opposing candidate. Although the “Stand By Your Ad” requirements are very similar to the LUR-related disclosures specified above, they are a bit more detailed. However, any failure to comply with these requirements is the candidate’s problem, not the station’s, so broadcasters need only worry about the LUR-related disclosures specified above.
WHAT IS THE SPONSORSHIP IDENTIFICATION REQUIREMENT FOR CANDIDATE ADS?
All spots must include a sponsorship ID stating that the ad was “paid for” or “sponsored by” the entity actually paying for the time. The sponsorship ID must reflect the true identity of the party paying for the ad. For TV, the sponsorship ID must be visual, readable (i.e., equal to or greater than 4 percent of the vertical picture height) and on the screen for at least 4 seconds. Also, if a candidate’s spot is paid by someone other than the candidate, the spot must state whether that person or entity is authorized by the candidate.
WHAT IS A POLITICAL DISCLOSURE STATEMENT?
So that candidates can make informed buying decisions, the FCC requires that stations fully and accurately disclose to candidates information concerning the station’s current advertising sales practices and policies. This information usually takes the form of a station “Political Disclosure Statement.” Although the FCC does not require that the information be provided to candidates in writing, we strongly advise stations to prepare written disclosure statements to avoid disputes as to what information has been provided to candidates. Also, it’s very important that the disclosure statement be kept up-to-date throughout the election season.
At a minimum, the disclosure statement should include information concerning (i) the classes of time available for purchase; (ii) the rates that will be charged for each class; (iii) how and when preemptions may be made and the likelihood of preemption for each class; (iv) payment policies; and (v) any other selling practice that could reasonably affect political buying decisions (for example, make-good rights).
WHAT ARE EQUAL OPPORTUNITIES?
When there has been a “use” of a station by one candidate, legally qualified opposing candidates for the same office (whether federal, state or local) must be given an equal opportunity to “use” the station in a manner comparable to the first candidate. Stations are not required to notify opposing candidates of their equal opportunities rights; instead notice is provided by placing information about political buys and other “uses” in the station’s political file. This information should be uploaded promptly as other candidates have only seven days to make their equal opportunities claims after the triggering “use.”
For example, if Mayoral Candidate A buys a schedule of prime time spots, then the station must allow Mayoral Candidate B an equal opportunity to purchase the same amount and desirability of time, provided that Candidate B requests such time within seven days after Candidate A’s first spot airs. The equal opportunities obligation also applies where a free “use” is made. For example, if the station airs an old movie in which Candidate A appears, then Candidate B would have a right to request free comparable time on the station.
Please note, however, that candidate appearances on many news and public affairs programs are exempt from the equal opportunities requirements. These exempt “uses” include candidate appearances on bona fide newscasts, news interview programs, news documentaries and on-the-spot coverage of news events.
WHAT IS THE “NO CENSORSHIP” RULE?
Stations cannot censor or edit a candidate’s ad, except to provide the required sponsorship identification information (discussed above). Unless the spot is obscene or otherwise violates a felony statute or another FCC rule, a station must broadcast a candidate’s ad uncensored – no matter how offensive, distasteful or defamatory the ad may be. Because stations cannot censor candidate ads, broadcasters are immune from civil liability for the content of such ads. On the other hand, the “no censorship” rule (and, hence, the station’s shield against potential liability) does not apply to third-party ads, so stations may refuse to air such ads or demand edits if they’re uncomfortable with the ad’s content.
WHAT NEEDS TO BE IN THE STATION’S PUBLICLY AVAILABLE ONLINE POLITICAL FILE?
All stations must maintain an online political file (uploaded to the FCC’s public inspection files website) that contains specific information concerning all requests for broadcast time made by or on behalf of candidates and, thanks to BCRA, certain third-party ads (discussed in the next section below).
For ads by candidates or their authorized committees, the file should include:
- Nature and disposition of all requests for time (e., whether request was accepted or rejected)
- Name of candidate and office sought
- Candidate’s authorized committee
- Name of committee’s treasurer
- Schedule of time purchased (e., spot length, classes of time, rates charged)
- Dates and times spots aired
- Any other written information relevant to the order (g., makegoods, LUR rebates)
The information listed above can be provided on contracts and invoices and should be uploaded to the online political file as soon as possible. Documentation of payment is not required to be—and should not be—placed in the online public file. Prior to uploading any document, review it carefully to ensure any payment information (such as credit card numbers) or other confidential information has been removed or redacted.
If there is a non-advertising appearance by a candidate (e.g., a candidate appears on a program not covered by one of the news exceptions to the equal opportunities rule), information regarding that non-advertising “use” should also be noted in the political file.
DO I HAVE TO ACCEPT THIRD-PARTY ADS?
No, a station can reject a third-party ad in its discretion if the ad is not sponsored or authorized by a candidate or his/her official committee.
WHAT CAN I CHARGE FOR A THIRD-PARTY AD?
Third-party ads are not entitled to lowest unit rates. Stations can set the rates for these spots based on demand and market conditions.
WHAT IS THE SPONSORSHIP IDENTIFICATION REQUIREMENT FOR THIRD-PARTY ADS?
Just like any other commercial ad, the spot must include a sponsorship ID stating that the ad was “paid for” or “sponsored by” the person or entity actually paying for the time.
DO EQUAL OPPORTUNITIES APPLY TO THIRD-PARTY ADS?
Generally, no; however, if a third-party ad includes the favorable appearance of a candidate – and is therefore a “use” – opposing candidates can request equal opportunities rights.
WHAT NEEDS TO BE IN THE PUBLICLY AVAILABLE ONLINE POLITICAL FILE FOR A THIRD-PARTY AD?
Data about third-party ads does not have to be placed in the online political file UNLESS the third-party ad falls into one of the following categories (which, in practice, they almost always do):
- If the spot includes the favorable appearance of a candidate, it will be considered a “use,” and general information about the order should be placed in the file (g., spot length, dates and times spots aired, etc.).
- If the spot concerns a “controversial issue of public importance” (g., ballot propositions, referenda, constitutional amendments, etc.) and the sponsor is a corporation, committee or group, the file must also include a list of officers, directors or committee members of the sponsoring organization.
- Pursuant to BCRA, if the spot involves a “political matter of national importance” (e., relates to a candidate, a federal election, or a “national legislative issue of public importance”), the station must collect all information normally collected for a candidate spot, plus (i) the name of the candidate, if any, referred to in the spot; (ii) the election, if any, referred to in the spot; (iii) the issue, if any, referred to in the spot; (iv) the name of the person purchasing the time; (v) the name, address and phone number of a contact person for the entity sponsoring the ad; and (vi) a list of officers, directors or committee members of the sponsoring organization.
With regard to this last bullet point, exactly what constitutes a “political matter of national importance” is as yet unspecified, but the FCC has advised us that they will defer to a station’s “good faith” discretion. However, the FCC staff has also indicated that it does not interpret BCRA’s recordkeeping requirements as being exclusive to spots that reference a candidate, a federal election or pending legislation, but may be triggered by any spot that is “political” in nature and of “national importance.” For example, an advertisement pertaining to a local ballot proposition could qualify if it references a position on an issue debated at the national level, such as gun control, healthcare or abortion rights. The FCC staff has also suggested that if a spot addresses multiple issues, the station must identify in the political file all of the issues referenced in the spot.
Finally, we note that political advertisers are sometimes reluctant to provide all of the required information; however, broadcasters must ensure that the station’s public file records are complete. Accordingly, stations should carefully review all information provided by an advertiser to confirm that the information is complete and accurate. If the station has a reasonable basis for believing that the information initially provided is incomplete or inaccurate, the station should make further inquiry and, as necessary, supplement the political file to ensure that all required information is adequately disclosed.
WHAT IF SOMEONE COMPLAINS ABOUT THE CONTENT OF A THIRD-PARTY AD AND DEMANDS THAT THE STATION STOP AIRING IT?
The “no censorship” rule and a station’s immunity from civil liability do not extend to third-party ads. Accordingly, before airing third-party ads, station management should be sure that it is comfortable with the content (and it can demand that changes be made to the content as a condition to airing the spot), since the station is not immune from defamation suits or copyright infringement claims arising out of the content of such ads.
A situation that occurs with increasing frequency – and intensity – as election day nears is this: a station runs a third-party ad that attacks a candidate, and then the candidate tells the station that the ad is a pack of lies and threatens to sue the station if it doesn’t stop running the ad. So what is a station to do? First, if the station doesn’t already have it, you should immediately request that the sponsor of the spot provide you with documentation of its claims. Second, we strongly recommend contacting your attorneys to assess the risk of continuing to the run the ad while you investigate the matter and also to help you determine if the documentation provided is sufficient to support the claims made in the ad.
Keeping in mind that a broadcaster is always free to decline running a third-party ad if it is uncomfortable with it, we note that most political ads – albeit replete with nasty political hardball – generally do not rise to the level of defamation. More often than not, the alleged defamatory content proves essentially to be a matter of interpretation, rather than an outright falsehood. Moreover, although the target of an attack ad often will argue that the station is responsible for the truth or falsity of all material aired on the station – which is technically true – the FCC has been disinclined to saddle stations with the burden of examining and verifying the merits of every political claim. However, when a third-party ad veers from political issues into attacks on a candidate’s personal character or integrity – e.g., accuses him or her of having an affair, committing a crime, etc. – stations should be extra cautious.
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To reiterate, the FCC’s political broadcasting rules and polices can be mind-numbingly complex…and even though we’ve spilled a lot of ink here, we’ve only covered the basics. Our hope, however, is that with this in hand, you can now recognize important issues as they arise and then intelligently discuss those issues with your attorneys.