Making the Broadcaster the Source for the Disclosure of Political Spending? What the FCC's Disclosure Rules Require and What Congress Might Want the FCC to Do
Last week, the FCC Commissioners appeared before Congress for an "oversight hearing." In such hearings, Congressmen often raise many different issues that may be on their mind – everything from issues about the administration of the FCC to detailed policy issues. In the hearing before the Senate Commerce Committee last week, one issue arose that broadcasters should monitor carefully to see what develops. During the course of the hearing, the FCC Commissioners were asked why the FCC had not taken steps to make sure that the sponsors of political advertisements were disclosed on the air. While the FCC rules already require disclosure of the sponsor of any ad, and enhanced disclosure for political ads or other "issue ads" on matters of public importance, what were the Senators after in this line of inquiry?
It appears that the Senators were asking the FCC to ask for more information about the source of the money used by political action groups to buy television advertising time on election issues - including the money used by PACs, SuperPACs and the other types of advocacy groups that spent so much money in the last election cycle, and are already beginning to run ads in states that have Senate races that are likely to be hotly contested in 2014. What do the FCC rules currently require?
As we have written before, any issue ad – whether it be on a Federal or state or local issue – requires the identification of the sponsoring group on the commercial. In addition, the FCC rules require that stations keep, in their public inspection file, a list of the principal officers or directors of the sponsoring organization. While the FCC has never required that stations be an investigatory arm of the government, in one case, the FCC did require a station to include on the advertisement what was considered the "true" sponsor of an ad campaign against an anti-smoking ballot issue, but that was only when it was clear that the group that was originally identified as the sponsor was a mere sham, with all of the officers and directors nothing more than lobbyists or paid employees of the tobacco company that had provided all the funding for the group. This ruling has never been extended to groups that are more broadly organized with local citizens acting as the governing board.
On Federal issues (any issue dealing with a Federal election or Federal issue - such as a matter to be decided by Congress or any DC administrative agency), the FCC rules require more – including all of the information that the FCC requires of a candidate ad. This would include the full schedule for the campaign and the price at which the spots were purchased. See our summary of the requirements for third-party ads here and here.
So what are some in Congress seeking? They reportedly want the FCC to require that stations collect more information on the sponsors of these ads – including not only the identification of the governing board of these groups, but also the source of funding for the organizations. While some of the Commissioners suggested that this suggestion would be worth reviewing, Commissioner McDowell questioned whether this would be a proper avenue for the FCC to pursue (or to force broadcasters to pursue) when other agencies like the Federal Election Commission are more directly charged with dealing with this kind of issue. It would seem to us that the expertise for mandating this kind of disclosure is not one within the core competency of the FCC. But, we will have to wait to see if this issue, which has been raised from time to time before (see our summary of the DISCLOSE Act, here and here, that was proposed and died in a previous Congress), has any more legs this time around than it has had in past.