David Oxenford

By: David Oxenford, Wilkinson Barker Knauer

With the 2024 election looming, broadcasters are already receiving requests for political advertising time, from PACs and other issue groups, and from both established candidates and newcomers eager to make an early splash to enhance their public standing.  Some of these potential buyers advance unique policy positions and, sometimes, unusual ad buying strategies.  How are broadcasters to deal with these early political ad buyers?

Each broadcaster needs to discuss the issues that arise with these early political ads, both internally with their business teams and with their outside FCC counsel or in-house legal advisor.  The first question to ask is whether a station even wants to run these ads.  Ads from non-candidate buyers do not need to be run by stations but, if run, will likely impose some political file obligations on stations to the extent that they discuss candidates, potential candidates, or electoral and political issues (for more on political file issues, see our articles here, here, and here, and this video discussion that I did for the Indiana Broadcasters Association).

Ads from purported candidates can also raise other issues.  First, are the ads for candidates for federal office, or only for state and local office?  Only federal candidates have reasonable access rights – meaning that stations are only mandated to take ads from federal candidates (see our article here on reasonable access considerations).  If stations do take ads from state and local candidates, they must treat all legally qualified candidates for the same office in the same way.  See our articles here and here on some of the differences between the treatment of state and local candidates under FCC rules.

That raises the question of who are “legally qualified” candidates at this point in the election season?  Generally, a legally qualified candidate is one who has qualified for a place on the ballot (which, in most states, likely has not happened as the local filing window for requests for ballot access has not yet opened for the 2024 elections) or one who has made a substantial showing that they are running as a write-in candidate.  There are special rules for a Presidential candidate similarly premised on a place on the ballot or a substantial showing of their candidacy.  Once a Presidential candidate is qualified in 10 states, they are generally considered, for FCC purposes, to be qualified in all states.

What is a substantial showing to determine that a candidate is qualified?  In the jurisdiction in which they are running (or the jurisdictions, in the case of a Presidential candidate), the test is to look at the actions of the candidate to see if they really are conducting a campaign – it is more than simply asking for airtime to run political ads on a broadcast station.  The factors to be considered include the following:

• Is the candidate making campaign speeches,
• Have they been distributing campaign literature,
• Have they been issuing press releases,
• Are they maintaining a campaign committee,
• Have they established campaign headquarters in the jurisdiction,
• Did they create a campaign website, and
• Are they using social media for the purpose of promoting or furthering a campaign for public office?

No one factor alone is sufficient – they all must be weighed to determine if the candidate really is conducting substantial campaign activity in the jurisdiction where they are seeking to claim that they are qualified, and the burden is on the purported candidate to show that they are legally qualified.  See this article on a recent FCC decision on the weighing of these factors.  This is a somewhat subjective determination that a broadcaster should make, based on all the facts, consulting with their attorney.  For some candidates who are not running in a primary, or are running in primaries later in 2024, there may not even be a campaign that has truly started – so for FCC purposes, those seeking to buy time now may not be “candidates” yet, and thus stations may have the option as to whether they need to accept their ads.  For major party presidential candidates in states with early primaries, many candidates may well be able to demonstrate that they meet the criteria for being legally qualified candidates, at least in some states, so that if they are federal candidates they will be entitled to reasonable access. A detailed analysis of these considerations is required – so contact your counsel for assistance in making this determination.

If the station has determined that a federal candidate is legally qualified so that reasonable access applies, or if the station is willing to sell time to the candidate even if the candidate does not meet the test of being legally qualified, the station should also look at other issues in considering any political advertisements that early buyers may want to start running now.  For ads that are not from candidates, or from potential candidates who are not yet legally qualified, there are some business considerations.  Does a station want to disrupt regular ad buyers or provoke the negative reactions from audience members who may react to political ads running outside of election season?

Other issues relate to the precedential nature of what you are doing.  These are questions to discuss with legal counsel.  By accepting ads from potential candidates before they are legally qualified, there may be an argument that you have conceded that there is an election, opening you to more requests for political airtime from other candidates.  Other issues may include novel requests for purchase – for instance, proposals that the candidate only pay after the spots have run, or that a candidate pay a station based on a percentage of funds raised in a candidate’s broadcast appeals.  On the latter request, check on campaign finance ramifications.  The FCC does not require that stations sell to political buyers per inquiry, or other ads where payment is based on the response that the buyer receives.  On the issue of not paying in advance, advancing credit to a candidate may set a precedent that could be applied to other political candidates later in election season.  The FCC allows stations to apply their normal credit policies to candidates.  The FCC has said the following about extending credit to candidates:

If a station’s credit policies would, for example, require advance payment from a commercial entity that has been established only for a temporary time or purpose (e.g., a seasonal fireworks merchant or a concert promoter), has an uncertain credit history with the station (e.g., a company that is new, advertising with the station for the first time, or advertises with the station only occasionally), or has an unstable financial condition, then the station can require advance payment from a political advertiser that falls within one or more of these categories. If, however, a station’s policy is to extend credit to commercial advertisers no matter what their nature, credit history, or financial condition, then the station would be required to extend credit to political candidates.

The FCC recognized that, under this standard, most candidates will not be extended credit and,  seemingly most stations do not routinely extend credit to candidates absent a guarantee of payment by an agency with an established credit history.  If that policy is not observed in one case, it could set a precedent for the future.  Thus, the ramifications of any credit extended to a political advertiser should be discussed with counsel, as extending credit to one candidate may require that it be extended to all candidates.

These are but some of the considerations for early season political ads.  We have written about other issues in the past (see for instance, our articles here and  here), and likely will be covering other issues in the near future.  Start your planning now – set political policies internally and discuss those policies with counsel so that you are familiar with all the ramifications of political sales throughout the coming election season.  Review your political disclosure statement and update it as necessary.  Educate your staff dealing with political issues, including those who post political information to the online public inspection file.  While many stations appreciate the boost that political money provides to ad sales, these sales also impose legal obligations that, if not observed, can result in serious consequences.  So be prepared!

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline. Access information here. (Members only access). There are no additional costs for the call; the advice is free as part of your MAB membership.