Last week, the Office of Management and Budget determined that the FCC’s new rules on Leased Access to cable channels (see our bulletin describing those rules) violated the Paperwork Reduction Act. This means that the new rules, which would have significantly lowered the cost for parties who wanted to lease cable channels to provide their own programming, will be sent back to the FCC for further consideration. These rules are also on appeal to the Courts, which had stayed the effectiveness of the rules while the appeal is being considered, which is usually a good indication that the Court had issues with the rules as well. The OMB action has the effect of returning the rules back to the FCC to be considered anew in light of the OMB findings. Our firm has prepared a memo detailing the decision, here. Given the OMB decision that these rules imposed too great a burden on cable systems, one wonders if this decision portends a similar result when the OMB reviews the FCC’s rules on Enhanced Disclosure and an on-line public inspection file – rules that would impose a significant burden on television broadcasters (about which we wrote here).
The OMB decision on the leased access rules highlighted some of the perceived shortcomings of the FCC decision, including that the FCC had not shown that they had taken steps to minimize the burden on companies who would have to hire staff to comply with the new rules, and they had not provided reasons why reduced timeframes for responses to requests for leased access were necessary. Looking at these standards, one would have to think that much of the same reasoning would apply to the FCC’s Enhanced Disclosure requirements for TV stations as set out in the new Form 355. The completion of the Form would clearly require the hiring of new staff. We’ve also questioned whether the Commission has given any justification for the increased paperwork requirements, as the information itself has no regulatory purpose as the FCC has not adopted any quantitative standards for public interest programming. With no purpose and increased costs, how could the OMB treat the enhanced disclosure requirements differently than it did the leased access requirements?