The Fair Elections Now Act (S. 1285) certainly isn't fair to everybody, and broadcasters can get in front of the line of aggrieved parties. The bill would cut rates, kill scheduling options, expand the pool of advertisers receiving discounts and directly tax broadcasters. NAB President/CEO David Rehr is leading the charge to keep such provisions off the law books.
Rehr fired off a letter to Diane Feinstein (D-CA) detailing problems with the bill. Rehr notes that under current law, candidates are offered a station's lowest unit rate (LUR), which is generally 30% below a station's usual rate. The new bill would force stations to offer a fixed rate 20% below LUR, and would apply during the 45-day period prior to a primary election and 60 days before a general election. It would make such advertising nonpreemptable. It would extend these rights to the federal party committees. Finally, it would impose a 2% tax on gross broadcast advertising revenues to give politicians and committees a "Political Advertising Voucher Account."
Rehr said, "The bill requires broadcasters – and broadcasters alone – to subsidize these discounted political advertising rates. It is unfair for government to single out broadcasters to shoulder these burdens." He also noted constitutional problems and the fact that such rules would harm not only broadcasters but small businesses that rely on broadcast stations to advertise their goods and services.
RBR observation: Is the US political system broken? It's not in our mission to get into that debate, but in our humble opinion, more political advertising would not contribute to a solution, it would exarcerbate the problem. Is there not enough mudslinging already? Have we not seen enough candidate families? We should select our representatives based on the same techniques used to influence our selection of soft drinks or toilet paper? The last thing we need are more political ads.
Text of Rehr's letter
June 20, 2007
Dear Senator Feinstein:
I am writing with regard to today's Senate Rules Committee hearing on S.1285, the Fair Elections Now Act. As the Committee hears testimony on the legislation, please know that sections of the bill are of great concern to broadcasters.
First, the bill requires broadcasters to offer participating candidates and political parties fixed advertising rates. These rates would be 20 percent less than the station's lowest unit charge (LUC) during the 45 days before a primary election and 60 days before a general election. Under current law, candidates already receive an average discount of about 30 percent through use of the LUC rates. The bill creates a significant price advantage for federal candidates over small business owners who advertise every day on broadcast television and radio.
Mandating a further reduction in rates also raises significant constitutional questions. The bill unconstitutionally favors certain types of speakers – – political candidates and political parties – – over other speakers. While current law (47 U.S.C. 315(b)) entitles political candidates to pay advertising rates that are equal to the lowest unit charge offered to a commercial client, the bill would entitle both political candidates and political parties to pay rates that are significantly more favorable than those afforded commercial clients. Such favoritism towards specific political speech and certain political speakers contradicts settled First Amendment principles.
Second, the legislation would bar broadcasters from preempting purchased airtime by federal candidates. All advertisers, including federal candidates, have choices when placing their ads. They may choose among various day parts regarding the time slot in which their ad may run, as well as from different classifications surrounding the ad. To mandate that a federal candidate must receive a steep price discount as well as guaranteeing a non-preemption classification gives federal candidates a special benefit unavailable to anyone else.
Third, the Fair Elections Now Act would extend LUC to federal party committees. Extending LUC discounts to political parties greatly expands LUC beyond the original scope of the law and would allow an entity not directly connected to a federal candidate access to discounted airtime. Were these provisions to become law, local businesses would be adversely affected by the limited inventory left for their advertising needs. Local advertising would need to get in line behind federal candidates and their political party organizations.
Fourth, the legislation would tax commercial broadcasters two percent of their gross advertising revenues to establish a Political Advertising Voucher Account for use by federal candidates and party organizations. The bill requires broadcasters – and broadcasters alone – to subsidize these discounted political advertising rates. It is unfair for government to single out broadcasters to shoulder these burdens.
Local broadcasters are proud of our service to communities. We take our responsibility as lifeline providers very seriously and are among the first to step up in times of emergency and need. We raise billions of dollars annually to the benefit of our local communities and charitable organizations that serve them. Local broadcasters very strongly oppose this tax proposal, as it would take away resources from our continued efforts to serve the public.
On behalf of the 8,300 members of the National Association of Broadcasters (NAB), please know of our concerns with S.1285 as outlined above and our opposition to the legislation should it move forward. NAB will be submitting a more detailed paper for inclusion in the hearing record. We look forward to meeting with you and your staff to provide a greater understanding of our concerns.
David K. Rehr
cc: Members, Senate Rules Committee