TO WIN BIG IN ’08 RACES, JUST FOLLOW THE RULES

This column is about big money: perhaps $2.6 billion in TV political ad spending in 2008 in federal, state and local races, from president to the local sheriff. Why so much? For starters, the unprecedented early heavy volume of presidential candidate advertising in 2007, the large number of candidates for that and other offices and polls showing voters as restive, undecided and eager for change (i.e., perhaps persuadable by TV advertising.)

To many in television, a downside of this historic opportunity is the web of political advertising regulation. Knowing and navigating it can empower stations to maximize election-year revenue, accommodate commercial and political advertisers and minimize advertiser complaints, refunds to candidates and FCC enforcement. 

In other elections, December would be too early for a column on this subject. But not this time around. The 45-day, lowest-unit-charge period for primary elections is already underway in several states, including Michigan, South Carolina and, of course, New Hampshire and Iowa. It starts Dec. 15 for Florida and Dec. 22 for the many Super Tuesday states with Feb. 5 primaries (California, New York, Illinois, among others). Some primary dates may still change.

To address this extraordinary situation, this column focuses on six areas that have been generating questions to the FCC and station lawyers. Later columns on other aspects of election law will follow in 2008.

1. The effect of Internet ad sale sites on lowest unit charge.

The FCC needs to decide a June 2007 petition to clarify whether lowest unit charges required for legally qualified candidates must reflect the low prices of airtime sold by many stations through Internet sales representatives like SoftWave, Bid4Spots/EBay and DmarcBroadcasting/Google. On these Web sites, advertisers indicate what they’re willing to pay for unsold time on a large “unwired network” of stations represented by the Web site proprietor. Stations can accept the bids online. 

During pre-election periods (45 days before primaries/caucuses, 60 days before general elections) stations must offer their “lowest unit charge”—the best rate that is in effect then for the most favored commercial advertiser—to legally qualified candidates for public office who appear in their own ads (i.e., candidate “uses”). Candidates are entitled to these rates even if they buy only a single spot and the commercial rate is based on volume.  

The pending legal issue is whether an earlier FCC policy exempting network-generated sales from individual station lowest unit charge calculations applies to the Internet arrangements. The expected ruling could affect many stations and candidates as use of the sites is increasing.

2. The anticipated increase in corporate and union requests for non-candidate, “issue ad” time.

Last month, a Federal Election Commission rule change allowed corporations and labor unions to use their own funds for political issue ads run during the 30 days before primaries and 60 days before general elections. These ads can name federal candidates if they stop short of directly supporting or opposing them. The change reflects a Supreme Court ruling, covered in this column last summer, striking down a former ad financing ban.

The FEC change applies directly to corporations, unions and ad producers, not stations or the FCC. But stations should prepare for more issue ad requests from more sources than previously. 

Issue ads are unlike candidate “uses,” which are bought by a legally qualified candidate or his/her campaign committee and the candidate appears “positively” in the ad in support of his/her election for at least 4 seconds. Stations do not have to sell issue ads at all, can charge any rate they choose, and equal time does not apply. (Note that a negative appearance of a candidate—in an ad by an opposing candidate or group—is not a “use” and does not trigger “use” obligations). Stations may also censor (e.g., require changes to) non-candidate ads. 

Not so for uses. They cannot be censored, and stations cannot be liable legally (e.g., for libel) for their contents.   

3. Employees who become candidates.  

A station is not legally required to take an anchor off the air if he or she decides to run for Congress. But certain regulations do kick in when the employee becomes a “legally qualified candidate.” That happens when the employee (or any candidate) has done all of the following: publicly announced, met the legal requirements for the position (e.g., minimum age) and met the local requirements, which vary even for federal candidates, to qualify for listing on the local voting place’s ballot or as write-ins.

Once an employee meets these tests, his or her air time must be timed and noted in the public file. Opposing candidates can request equal opportunities within seven days of each employee appearance.  If the employee did not pay for the time, “equal” means free. Note that the subject matter of the employee appearance does not have to relate to the campaign to trigger equal opportunities; the on-air time itself does it. 

If the employee appears in a news program that is exempt from equal opportunities under federal law, no equal opportunities applies as long as the employee does not control the show. Being the host of a news interview is an example of control. The FCC defers to station judgments on this unless there is a complaint that a judgment is unreasonable.

4. Non-employee candidates who appear in non-news TV programs.

Presidential candidate Fred Thompson is not a station employee but appears in Law and Order episodes. TV stations must document those—and other non-employee candidate appearances—in their public files. Opponents can seek equal opportunities for the number of minutes that Thompson appears. 

Thus far it appears that no opponent has done that, perhaps because broadcasters have stopped airing the Thompson episodes. The FCC has received no complaints on this. Cable is different. The political rules apply only to “origination cablecasting,” defined as programming content under the operator’s exclusive control. That is likely why Thompson episodes may continue to run on cable channels, though the episodes could spark a challenge to an operator’s immunity.

5.  Ads on TV station Web sites.

These are burgeoning. FCC political ad requirements apply only to broadcasting, not to station Web sites. If a station links the two, however, such as by offering Web ads to candidates who buy broadcast time, stations should be careful not to discriminate among opposing candidates in how that is done. 

6. State and local candidates.

Federal candidates are in a class by themselves. Each has a personal right to reasonable access to air time, including in primetime, in connection with his/her campaign. (To get lowest unit charge, though, only federal candidates must tell stations, in writing when the buy is made, whether or not their ad will refer to an opposing candidate. If yes, the sponsoring federal candidate’s image must appear at the ad’s end for at least four seconds while wording is displayed identifying the sponsoring candidate and saying that he or she approved the ad and the candidate or authorized committee paid for it.) 

Candidates for state and local office lack the right of reasonable access as to primaries and general elections.  A station must decide which, if any, state and local races it will sell time for. Stations may, and should, specify in a written political time policy the nonfederal contests for which they will offer time, along with the amounts and classes of time and other details. Stations can change or end these policies as long as equal opportunities requests for ads already run are honored. 

Once a station decides to sell or give time to non-federal candidates, lowest unit charge, no content censorship or liability and equal opportunities apply just as for federal candidates.

In sum, focusing on the details now and preparing a plan for the year ahead could pay important dividends. Stations should be careful not to “oversell” noncandidate time in advance, to allow for candidate reasonable access and equal opportunities requests whose numbers may exceed expectations.

This column on TV law and regulation by Michael D. Berg, a veteran Washington, D.C. communications lawyer and the principal in the Law Office of Michael D. Berg, appears monthly. He is also the co-author of FCC Lobbying: A Handbook of Insider Tips and Practical Advice. He can be reached at [email protected] or 202-298-2539.

Note: This article provides general guidance only and is not a substitute for individualized legal advice for particular situations.