Failing to meet the obligations set out under the law for required sponsorship identification on Federal political ads could, theoretically, cost candidates significant amounts of money – if stations decide to hold the candidates to the letter of the law. Under the terms of the Bipartisan Campaign Reform Act (“BCRA”), Federal candidates airing television commercials that refer to a competing candidate must specifically state, in the candidate’s own voice, that he or she has approved the ad, while a full-screen image of the candidate appears on the screen. In addition, the name of the sponsoring candidate’s campaign committee must appear in text on the screen for at least 4 seconds at 4 percent of screen height, with sufficient color contrast to make the text readable. If the proper identification is not contained in an ad, the candidates forfeit their right to lowest unit rates for the entire pre-election period (45 days before a primary or 60 days before an election), even with respect to future ads that comply with the rules. In recent days, representatives of Democratic Congressional candidates have reportedly filed complaints that argue that Republican competitors have not complied with the rules in several cases, as their written disclosures did not air for the full four seconds. The challengers argue that television stations must take away LUR for these candidates. While the statute say that the candidates forfeit their rights to such rates, the law is unclear as to whether stations are obligated to deny that rate to candidates after the right has been forfeited – and these cases could resolve this issue.
Television stations undeniably have the power to charge full rates to candidates whose ads have not complied with the requirements of the campaign statute. However, many stations have been reluctant to do so for minor infractions such as the ones identified in this complaint. Why wouldn’t television stations want to charge more money? For several reasons. First, denying one candidate lowest unit rates will no doubt trigger a fly-specking of every commercial by the competitor who filed the complaint against the first candidate, to try to trigger a forfeiture of the second candidate's right to Lowest Unit Rates, and adjudicating such complaints will no doubt make the station’s political sales process much more difficult and costly to administer. In addition, there is the question of whether, for a minor violation, a station really wants to give the other candidate a political advantage – especially if the candidate who gets charged more more wins the election and gets to vote on laws that may effect business in the future. But can stations legally continue to charge the lowest unit rate even when a candidate has not complied with the legal requirements for sponsorship identification?
The issue is really whether, by charging candidates the lowest unit rates when they have forfeited their rights to that rate, the stations are giving the candidates illegal campaign contributions – i.e. financial benefits from the station's corporate owners in the form of discounted rates. This is not the first time the issue has come up – in several past elections it has been brought to the Federal Election Commission who has, each time, tied in a 3-3 vote as to whether the practice was prohibited. Thus, the issue has remained unsettled. Television stations, and the candidates who have received the discounts, have argued that the candidates are not getting something at below market rates as, by definition, the LUR is the rate charged to the station’s best commercial customer. Thus, that rate has been charged commercially and hence is not a “contribution” to the candidate, but is a service given for value. Those arguing on the other side contend that, in practice, candidates get benefits by being allowed to buy these spots at rates that most commercial clients could not obtain, and thus client’s are in fact getting a benefit.
For more information on the sponsorship identification requirements for political ads, see our Political Broadcasting Guide. And watch these pages to see if the issues are resolved in time for this election, or if they will continue to be unresolved even if they reach the FEC once again.