TV stations fight FCC over political ad disclosure

Broadcasters are pushing back against the Federal Communications Commission after the agency made clear it wants broader public disclosure regarding TV political ads.

With the 2020 election less than a year away and political TV ads running more frequently, the FCC issued a lengthy order to clear up any ambiguities licensees of TV stations had regarding their responsibility to record information about ad content and sponsorship. In response, a dozen broadcasting stations sent a petition to the agency, asking it to consider a more narrow interpretation of the law.

This dispute over disclosure rules for TV ads comes at a time when digital ads are subject to little regulation. Efforts to apply the same rules for TV, radio and print advertising across the internet have been stymied by Congress's partisanship and the Federal Election Commission being effectively out of commission.

Already presidential candidates have spent more than $100 million on TV ads since Jan. 1. Unsurprisingly, billionaires Tom Steyer and Michael Bloomberg are collectively responsible for 77 percent of the ad buys so far. Broadcast and cable TV ad spending for the 2016 election totaled about $5.8 billion, according to media tracker Borrell Associates.

Sign up for The Fulcrum newsletter

Television stations are required to maintain public files that document the content of ads and who pays for them. Good-governance groups access these files to track activity and ensure proper disclosure. When discrepancies are found, groups will often file complaints with the FCC.

While it seems the FCC will stand by its clarification of the law since it favors more ad disclosure, the agency did agree to allow for public comments until mid-January after TV stations complained input wasn't considered in the first place.

Rather than announce the clarification in a separate order, the FCC included it in a document that also addressed complaints filed by good-governance groups against the TV stations for improperly disclosing ad information.

The stations were admonished — officially reprimanded, but not fined — by the FCC for their violations and warned that, moving forward, failure to comply with the clarified disclosure obligations would result in "enforcement action."

So what did the FCC clarify?

In addition to ads made by or on behalf of candidates, broadcasting stations are also responsible for reporting who sponsored ads relating to "any political matter of national importance." This clause was the main focus of the FCC's clarification because TV stations were interpreting it in different ways.

If an ad mentions federal candidates, elections or legislative issues, federal law requires broadcast licensees to include the name of the candidate, election or issue in their public filings. Some licensees argue that because the law uses the term "or" when referring to the three types of information, they have the discretion to select what information is reported. The FCC disagrees and says all categories referenced must be included in the ad report.

State and local election ads are not necessarily exempt from the "national importance" clause, the FCC says. For example, if an ad about a gubernatorial candidate mentions immigration reform, it would trigger a disclosure obligation because immigration reform is a national issue.

The FCC also clarified how licensees should report who pays for the ads. The law requires licensees to report "a list of the chief executive officers or members of the executive committee or board of directors" of any group seeking to purchase political ad time. In the case a complete list is not provided, the FCC says licensees must inquire further with the ad buyer. This is meant to increase transparency around ad sponsorship since outside groups often don't have to disclose their donors (see "dark money").

The agency says requiring broader disclosure by stations will "avoid illogical results than a narrower reading" would. For instance, if two stations ran the same ad, but reported differently, the political ad files would contain "dramatically different records, creating the potential for confusion and, thereby, frustrating the ability of those who are seeking to track and analyze political advertising in a particular market."

Some licensees argue these rules are "too onerous," but the FCC is not sympathetic. It believes the benefits of disclosure "outweigh the marginal burdens stations may incur."

And what did the TV stations have to say about this?

The National Association of Broadcasters, Hearst Television, Graham Media Group, Nexstar Broadcasting Fox Corporation, Tegna and the E.W. Scripps Company argue in their petition that the FCC's interpretation of the law is too broad and has "inadvertently and unnecessarily created a minefield" for broadcasters.

They recommend narrowing the definition of "a political matter of national importance" to mean "a message directed to or about national political actors in a position to take national political action on the matter" — eliminating the possibility of state and local ads being subject to disclosure.

Rather than require "a laundry list of issues" referenced in each ad, the petitioners say the FCC should allow TV stations to "make reasonable, good faith efforts to disclose the topics that are a focus of political ads."

"These decisions will have significant, far-reaching and imminent impacts on all broadcasters, especially during the 2020 election cycle," the petitioners wrote.

Good-governance groups weigh in

Although this dispute between the broadcasting group and the FCC is still ongoing, the agency continues to issue enforcement orders.

On Tuesday, the FCC settled a complaint filed two years ago by good-governance groups Issue One and the Campaign Legal Center. The complaint was directed at two Georgia TV stations for improperly disclosing information for ads that ran in the 2017 special election for the state's 6th district — the most expensive House race in U.S. history.

The FCC admonished the stations for failing to provide complete information about the content of the ads. Both Issue One and the Campaign Legal Center said they are pleased with the agency's ruling. (The Fulcrum has been incubated by Issue One but remains journalistically independent.)

"Stations that air political ads have an obligation to ensure that viewers have relevant information about who is attempting to influence their vote. The FCC should continue to uphold the public's right to basic information about the content ads and the wealthy special interests that fund them," said Brendan Fischer, CLC's director of federal reform.

Meredith McGehee, executive director of Issue One, said the FCC should be wary of the broadcasters' proposal to narrow regulations governing disclosure of political TV ads.

"Weakening of current disclosure standards would be misguided, especially at a time when dark money groups are spending millions on political ads and trying to hide who is paying for political advertising in elections," McGehee said.