Rule2022-02484
Political Programming and Recordkeeping Rules
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
February 10, 2022
Effective
March 14, 2022
Issuing agencies
Federal Communications Commission
Abstract
In this document, the Commission updates the political programming and recordkeeping rules for broadcast licensees, cable television system operators, Direct Broadcast Satellite (DBS) service providers, and Satellite Digital Audio Radio Service (SDARS) licensees. The revisions conform the political programming and recordkeeping rules with statutory requirements, reflect modern campaign practices, and increase transparency.
Full Text
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[Federal Register Volume 87, Number 28 (Thursday, February 10, 2022)]
[Rules and Regulations]
[Pages 7748-7756]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-02484]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 25, 73, and 76
[MB Docket No. 21-293; FCC 22-5; FR ID 69577]
Political Programming and Recordkeeping Rules
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: In this document, the Commission updates the political
programming and recordkeeping rules for broadcast licensees, cable
television system operators, Direct Broadcast Satellite (DBS) service
providers, and Satellite Digital Audio Radio Service (SDARS) licensees.
The revisions conform the political programming and recordkeeping rules
with statutory requirements, reflect modern campaign practices, and
increase transparency.
DATES: Effective March 14, 2022, except for the amendments to
Sec. Sec. 25.701(d), 25.702(b), 73.1943, and 76.1701, which are
delayed indefinitely. The Commission will publish a document in the
Federal Register announcing the effective date.
FOR FURTHER INFORMATION CONTACT: For additional information, contact
Kathy Berthot, <a href="/cdn-cgi/l/email-protection#743f15001c0d5a361106001c1b00341217175a131b02"><span class="__cf_email__" data-cfemail="efa48e9b8796c1ad8a9d9b87809baf898c8cc1888099">[email protected]</span></a>, of the Media Bureau, Policy
Division, (202) 418-7454.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report
and Order, FCC 22-5, adopted and released on January 25, 2022. This
document will be available via ECFS, <a href="http://www.fcc.gov/cgb/ecfs/">http://www.fcc.gov/cgb/ecfs/</a>.
Documents will be available electronically in ASCII, Word, and/or Adobe
Acrobat. Alternative formats are available for people with disabilities
(Braille, large print, electronic files, audio format), by sending an
email to <a href="/cdn-cgi/l/email-protection#086e6b6b3d383c486e6b6b266f677e"><span class="__cf_email__" data-cfemail="31575252040105715752521f565e47">[email protected]</span></a> or calling the Commission's Consumer and
Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432
(TTY).
Paperwork Reduction Act of 1995 Analysis
This document contains new or modified information collection
requirements. The Commission, as part of its continuing effort to
reduce paperwork burdens, will invite the general public and the OMB to
comment on the information collection requirements contained in the
amendments to Sec. Sec. 25.701(d), 25.702(b), 73.1943(a) and (b), and
76.1701(a) and (b), in a separate Federal Register document, as
required by the Paperwork Reduction Act of 1995, Public Law 104-13, see
44 U.S.C. 3507. In addition, pursuant to the Small Business Paperwork
Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we
previously sought specific comment on how we might further reduce the
information collection burden for small business concerns with fewer
than 25 employees.
Congressional Review Act
The Commission has determined, and the Administrator of the Office
of Information and Regulatory Affairs, Office of Management and Budget,
concurs, that this rule is ``non-major'' under the Congressional Review
Act, 5 U.S.C. 804(2). The Commission will send a copy of this Report
and Order to Congress and the Government Accountability Office pursuant
to the Congressional Review Act, 5 U.S.C. 801(a)(1)(A).
Synopsis
I. Introduction
1. In this Report and Order, we update our political programming
and recordkeeping rules for broadcast licensees, cable television
system operators, Direct Broadcast Satellite (DBS) service providers,
and Satellite Digital Audio Radio Service (SDARS) licensees. We revise
the definition of ``legally qualified candidate for public office'' to
add the use of social media and creation of a campaign website to the
existing list of activities that may be considered in determining
whether an individual running as a write-in candidate has made a
``substantial showing'' of his or her bona fide candidacy. We also
amend our political file rules consistent with the Bipartisan Campaign
Reform Act of 2002 (BCRA), which extends the Commission's political
file requirements to any request for the purchase of advertising time
that ``communicates a message relating to any political matter of
national importance'' (i.e., issue ads) and specifies the records that
must be maintained. These updates, which are consistent with the
proposals set forth in the Notice of Proposed Rulemaking (NPRM) in this
proceeding, not only conform our rules with statutory requirements,
they also reflect modern campaign practices and increase transparency.
II. Background
2. In recognition of the critical role that political programming
plays in keeping the electorate informed, Congress has long established
specific requirements governing political programming. These
requirements ensure that candidates for elective office have access to
broadcast facilities and certain other media platforms and foster
transparency about entities sponsoring advertisements.
3. Political Programming Obligations. Political programming
obligations for certain Commission licensees and regulatees are set
forth in Sections 312(a)(7) and 315 of the Communications Act of 1934,
as amended (Act), 47 U.S.C. 312(a)(7), 315. Section 312(a)(7) requires
broadcast licensees to give legally qualified candidates for federal
office ``reasonable access'' to their facilities, or to permit them to
purchase ``reasonable amounts of time.'' Section 312(a)(7) of the Act
also applies to SDARS licensees and DBS service providers, but it does
not apply to cable system operators. Under section 315(a), if a
broadcast licensee permits one legally qualified candidate for a public
office to use its station, it must afford all other candidates for that
office an ``equal opportunity'' to use the station. Section 315(b)
provides that, during certain periods before an election, legally
qualified candidates are entitled to ``the lowest unit charge of the
station for the same class and amount of time for the same period.''
The equal opportunity and lowest unit charge requirements also apply to
cable system operators, SDARS licensees, and DBS service providers. The
entitlements afforded by Sections 312(a)(7) and 315 of the Act are
available only to individuals who have achieved the status of ``legally
qualified candidate.''
4. The Communications Act does not define the term ``legally
qualified candidate,'' but the Commission has adopted a definition and
codified it in Section 73.1940. Generally, in order to be considered a
``legally qualified candidate,'' an individual must publicly announce
his or her intention to run for office, must be qualified to hold the
office for which he or she is a candidate,
[[Page 7749]]
and must have qualified for a place on the ballot or have publicly
committed himself or herself to seeking election by the write-in
method. If seeking election by the write-in method, the individual, in
addition to being eligible under applicable law to be a write-in
candidate, must make a ``substantial showing'' that he or she is a bona
fide candidate for the office being sought. Section 73.1940(f) of the
Commission's rules establishes the requirements for making a
``substantial showing'' of a bona fide candidacy. The term
``substantial showing'' of a bona fide candidacy means ``evidence that
the person claiming to be a candidate has engaged to a substantial
degree in activities commonly associated with political campaigning.''
Such activities include making campaign speeches, distributing campaign
literature, issuing press releases, maintaining a campaign committee,
and establishing campaign headquarters.
5. Political Recordkeeping Obligations. The political recordkeeping
requirements are integral to ensuring compliance with the statutory
protections for political programming. The Commission initially adopted
rules requiring broadcast stations to maintain public inspection files
documenting requests for political advertising time more than 80 years
ago. The Commission subsequently extended political file rules to cable
television system operators, DBS providers, and SDARS licensees.
Requiring these entities to maintain complete and up to date political
files is critical because the information in these files directly
affects, among other things, the statutory rights of opposing
candidates to request equal opportunities under Section 315(a) of the
Act and present their positions to the public prior to an election. In
addition, the political files allow the public to verify that
Commission licensees and regulatees have complied with their
obligations relating to use of their facilities by candidates for
political office and to obtain information about entities sponsoring
candidate and issue advertisements.
6. In 2002, Congress enacted the BCRA, which amended Section 315 of
the Act. The BCRA added a new Section 315(e) to codify the Commission's
existing political file obligations by requiring that information
regarding any request to purchase advertising time that ``is made on
behalf of a legally qualified candidate for public office'' be placed
in the political file. The BCRA also expanded the political file
requirements to include any request to purchase political advertising
time that ``communicates a message relating to any political matter of
national importance,'' (i.e., issue ads). Additionally, Section
315(e)(2) of the Act specifies the kinds of records that must be
maintained in political files, and Section 315(e)(3) of the Act
provides that ``[t]he information required by [Section 315(e)] shall be
placed in a political file as soon as possible and shall be retained by
the licensee for a period of not less than 2 years.''
7. In August 2021, the Commission adopted an NPRM proposing to
update the political programming and recordkeeping rules. The NPRM
proposed to revise the definition of ``legally qualified candidate'' to
add the use of social media and creation of a campaign website to the
existing list of activities that may be considered in determining
whether an individual running as a write-in candidate has made a
``substantial showing'' of his or her bona fide candidacy. The NPRM
also proposed to revise the political file rules to conform with
Section 315(e), as amended by the BCRA. Only three comments were
submitted in response to the NPRM. The National Association of
Broadcasters (NAB) supports adding the use of social media and the
creation of a campaign website to the list of activities that may be
taken into account in determining whether a write-in candidate has made
a substantial showing that he or she is a ``legally qualified candidate
for public office'' but submits that certain conditions should apply.
Kenia Trujillo (Trujillo) raises concerns that adding the use of social
media to this list would make it too easy for anyone to obtain status
as a ``legally qualified candidate for public office.'' Canal Partners
Media, LLC (Canal Partners) asserts that broadcast licensees often
refuse to comply with the political file obligations, which makes it
difficult to monitor their compliance with the political programming
requirements. No reply comments were submitted.
III. Discussion
A. Substantial Showing for Write-In Candidates
8. We adopt our proposal and update the definition of ``legally
qualified candidate for public office'' in Sections 73.1940 and 76.5(q)
of the Commission's rules to add the use of social media and the
creation of a campaign website to the list of activities that a
broadcast licensee or cable operator may take into account in
determining whether an individual running as a write-in candidate has
made a ``substantial showing'' of his or her bona fide candidacy. As we
explain above, only those individuals who have achieved the status of
``legally qualified candidate'' may avail themselves of the benefits
bestowed by the political programming rules, including the reasonable
access, equal opportunities, and lowest unit charge provisions. An
individual seeking elective office using the write-in method must, in
addition to being eligible under applicable law to be a write-in
candidate, make a ``substantial showing'' that he or she is a bona fide
candidate for the office. Sections 73.1940(f) and 76.5(q)(5) define
what it means to make a ``substantial showing'' by listing various
activities that are commonly associated with political campaigning,
including ``making campaign speeches, distributing campaign literature,
issuing press releases, [and] maintaining a campaign headquarters.''
9. We conclude that adding the use of social media and the creation
of a campaign website to the list of activities that may be taken into
account in determining whether there has been a ``substantial showing''
of a bona fide candidacy will ensure that our definition of ``legally
qualified candidate'' more accurately reflects modern campaign
practices. As stated above, NAB supports this revision. In so doing, it
``agree[s] with the FCC that modern candidates routinely use social
media and campaign websites to share their views and solicit votes and
financial contributions.'' Recent articles reinforce that bona fide
political campaigns use major social media platforms, such as Twitter,
Facebook, and Instagram, to share campaign updates, communicate with
voters, advertise, solicit support, and fundraise, and that such
engagement in social media use typically increases donations for new
politicians. In addition, social media platforms enable political
campaigns, especially for new or lesser known candidates, to build
support by disseminating campaign updates and targeting advertisements
to potential voters, and they provide sophisticated tools to regularly
measure user engagement. It also has become common practice for bona
fide candidates to use campaign websites to connect to a wide audience
of potential voters and facilitate direct communication and
fundraising. No commenters challenged or rebutted the proposition that
candidates today regularly use social media and campaign websites to
connect with voters or the articles and media reports cited in the NPRM
to support that proposition. We therefore
[[Page 7750]]
conclude that revising the definition of ``legally qualified
candidates'' to add the use of social media and the creation of a
campaign website to the list of activities that may be considered in
determining whether there has been a ``substantial showing'' of a bona
fide candidacy is consistent with modern campaign practices.
10. Some examples of social media activities that may support a
substantial showing of a bona fide candidacy include the use of social
media to fundraise, solicit votes, share policy positions, and engage
in digital dialogues with voters. These examples are intended to be
illustrative, rather than an exhaustive list of the social media
activities that may be relied upon in making a substantial showing of a
bona fide candidacy. Other campaign-related uses of social media may be
taken into account in determining whether an individual has made a
substantial showing that he or she is a ``legally qualified
candidate.''
11. We emphasize that the use of social media and campaign websites
alone will not be sufficient to support a finding that an individual
has made a substantial showing that he or she is a ``legally qualified
candidate.'' As NAB points out, ``given the simplicity of creating and
running a social media account or website, certain stipulations should
apply to ensure the legitimacy of candidates. Otherwise, any individual
with a Facebook, Twitter or Instagram account could claim status as a
legally qualified candidate . . . .'' Accordingly, as proposed in the
NPRM, social media presence and campaign websites will be treated as
additional indicators of activities commonly associated with political
campaigning that may be relied on to make a substantial showing of a
bona fide candidacy, not as determinative factors. At NAB's suggestion,
we include language in the substantial showing rules that specifically
states that ``[t]he creation of campaign websites and the use of social
media shall be additional indicators of a bona fide candidacy, not
determinative factors.'' We therefore reject concerns raised by
Trujillo that the addition of social media to the list of activities
that supports a substantial showing for a write-in candidate could
allow anyone to rely solely on social media and campaign websites to
obtain status as a ``legally qualified candidate for public office.''
12. We agree with NAB that only digital activities that are
directly related to the campaign should be counted toward the requisite
substantial showing. The definition of ``legally qualified candidate''
set forth in our rules states that ``the term substantial showing of a
bona fide candidacy . . . means evidence that the person claiming to be
a candidate has engaged to a substantial degree in activities commonly
associated with political campaigning.'' In the NPRM, we proposed to
add to the list of activities commonly associated with political
campaigning ``creating a campaign website, and using social media for
the purpose of promoting or furthering a campaign for public office.''
This language, which we are including in the final rules, makes clear
that only digital activities that are campaign-related should be taken
into account in determining whether there has been a substantial
showing of a bona fide candidacy.
13. We agree with NAB that digital activities like social media and
campaign websites must be combined with campaign activities conducted
in the relevant geographic area to substantiate a candidate's ``genuine
interest in elective office,'' ``given the simplicity of creating and
running a social media account or website.'' Therefore, we are
including language in the revised substantial showing rules that
specifically states that ``[t]he creation of a campaign website and the
use of social media shall be additional indicators of a bona fide
candidacy, not determinative factors, and that such digital activities
must be combined with other activities commonly associated with
political campaigning that are conducted in substantial portions of the
relevant geographic area'' (e.g., establishing a campaign headquarters,
making campaign speeches, participating in debates, appearances at
community events, and distributing campaign literature). We note that
the NPRM contemplated a similar geographic limitation in seeking
comment on whether to add any other activities consistent with modern
campaign practices, such as digital marketing and advertising, to the
list of recognized campaign activities, specifically asking whether the
substantial showing analysis should ``involve any limiting factors,
such as requiring that the marketing and advertising be directed toward
persons in areas where votes are being solicited.'' We find that the
requirement that digital activities like social media and campaign
websites must be combined with campaign activities conducted in the
relevant geographic area is an appropriate and necessary limitation on
our original proposal to ensure a candidate's legitimacy when relying
on social media and campaign websites. We will consider what
constitutes the ``relevant geographic area'' on a case-by-case basis.
In general, however, the ``relevant geographic area'' will consist of
the legislative, congressional, or other electoral district in which
the candidate is soliciting votes from eligible voters.
14. NAB requests that we amend our substantial showing rules to
specify that write-in candidates ``bear the burden of demonstrating the
substantial showing required'' to be a legally qualified candidate, and
that a Commission licensee or regulatee's ``reasonable, good faith
determination as to whether a candidate has fulfilled this requirement
is entitled to deference.'' We agree with these interpretations and
note that the Media Bureau has long interpreted the Commission's
substantial showing rules in this manner. Given the dearth of comments
on this question, including from political candidates and the public,
we decline to amend our rules. However, we will address these issues
based on the facts and circumstances of each particular case in keeping
with this interpretation.
15. Additionally, we decline to add any other activities consistent
with modern campaign practices, such as the use of digital marketing
and advertising, to the list of recognized campaign activities in
Sections 73.1940(f) and 76.5(q)(5) of our rules. No commenter expressly
supported or even addressed the addition of other such activities to
the list of recognized campaign activities set forth in the rules. In
the absence of any support or comment in the record on this issue, we
conclude that the addition of other activities to the list is not
warranted at this time.
B. Implementation of the BCRA and Section 315 of the Act
16. We adopt our proposal and amend the political file rules for
broadcast licensees, cable operators, DBS providers, and SDARS
licensees consistent with the BCRA and Section 315(e) of the Act. No
commenter objects to this update. Enacted in 2002, the BCRA, among
other things, added a new Section 315(e) of the Act. Section
315(e)(1)(A) codifies the Commission's long-standing requirement that
records of a request to purchase advertising time that ``is made on
behalf of a legally qualified candidate for public office,'' known as a
candidate ad, be maintained in the political file. Section 315(e)(1)(B)
extends political recordkeeping obligations to records of a request for
the purchase of advertising time that ``communicates a message relating
to any political matter of national importance,'' known as an issue ad.
[[Page 7751]]
Section 315(e)(2) identifies the specific records that must be placed
in political files for both candidate and issue ads. These records
include (1) whether the request to purchase broadcast time is accepted
or rejected by the licensee; (2) the rate charged for the broadcast
time; (3) the date and time on which the communication is aired; (4)
the class of time that is purchased; (5) the name of the candidate to
which the communication refers and the office to which the candidate is
seeking election, the election to which the communication refers, or
the issue to which the communication refers (as applicable); (6) in the
case of a request made by, or on behalf of, a candidate, the name of
the candidate, the authorized committee of the candidate, and the
treasurer of such committee; and (7) in the case of any other request,
the name of the person purchasing the time, the name, address, and
phone number of a contact person for such person, and a list of the
chief executive officers or members of the executive committee or of
the board of directors of such person. Although the Commission has
provided guidance on political recordkeeping consistent with these
statutory requirements following their adoption in 2002, the political
file rules were not previously updated to reflect these statutory
requirements.
17. We accordingly revise the political file rules for broadcast
licensees, cable television system operators, DBS providers, and SDARS
licensees to bring them into conformity with Section 315(e) of the Act.
Specifically, we revise our rules to require these entities to maintain
in their online political files not only records of each request for
advertising time that is made by or on behalf of a legally qualified
candidate for public office, but also records of each request for
advertising time that ``communicates a message relating to any
political matter of national importance.'' Additionally, we amend the
rules to specify the particular records that must be maintained in
online political files for both candidate ads and issue ads, consistent
with the list set forth in Section 315(e)(2). These revisions ensure
that the political recordkeeping rules fully and accurately reflect
statutory requirements. Further, these revisions will foster greater
transparency about the entities sponsoring candidate and issue ads.
18. We do not believe this is the appropriate proceeding to address
Canal Partners' proposed interpretation of the phrase ``a message
relating to any political matter of national importance'' in Section
315(e)(1)(B). Canal Partners asserts that ``licensees regularly refuse
to comply with their public-disclosure obligations'' and urges the
Commission to make clear that ``the phrase `a message relating to any
political matter of national importance' should be interpreted broadly
in favor of full disclosure and transparency and that licensees must
act fairly, sensibly, honestly, and without any intent to seek
commercial advantage when deciding whether to place information in
their public political files.'' Canal Partners makes allegations
against two broadcast stations to support its assertion that licensees
regularly refuse to comply with their public-disclosure obligations.
19. As an initial matter, we decline to address this issue as we
did not seek comment on the interpretation of this phrase in the NPRM.
Even assuming that there was misconduct by the two stations referenced
by Canal Partners, we see no need to adopt a rule on this issue at this
time. The Commission addresses complaints on their individual merits.
To the extent that Canal Partners maintains that licensees regularly
refuse to comply with their political file obligations, specific
allegations of such misconduct are properly addressed through the
complaint process. Furthermore, the Commission recently clarified the
standard of review of broadcasters' compliance with their political
file disclosure obligations. Specifically, the Commission clarified
that the agency will apply a standard of reasonableness and good faith
decision-making with respect to the efforts of broadcasters to comply
with their obligations under Section 315(e) of the Act. To the extent
that Canal Partners challenges the Commission's clarifications, we find
that challenge is an untimely petition for reconsideration of that
prior order and accordingly we decline to adopt it.
C. Cost-Benefit Analysis
20. We conclude that to the extent that the revised rules impose
any costs on Commission licensees and regulatees, such costs will be
minimal and are outweighed by the benefits to the public of the revised
rules. No commenters explicitly addressed the costs and benefits of the
proposed rules or provided specific data and analysis supporting
claimed costs and benefits in response to the NPRM. As noted above,
however, NAB states that the revision to the definition of ``legally
qualified candidates'' will not drastically alter current industry
practices because broadcasters already consider digital activities in
determining whether an individual has established that he or she is a
bona fide candidate. In addition, the revisions to the political file
rules merely conform our rules to longstanding statutory requirements
and the Commission has provided licensees and regulatees guidance on
political recordkeeping consistent with these statutory requirements
since their adoption in 2002. Thus, we expect that any costs imposed by
the updated rules will be minimal and outweighed by the public benefits
of transparency and clarity.
Final Regulatory Flexibility Act Analysis
21. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), the Initial Regulatory Flexibility Analysis (IRFA) was
incorporated into the NPRM released in this proceeding. The Federal
Communications Commission (Commission) sought written public comment on
the proposals in the NPRM, including comment on the IRFA. The
Commission received no comments on the IRFA. This Final Regulatory
Flexibility Analysis (FRFA) conforms to the RFA.
A. Need for, and Objectives of, the Report and Order
22. The Report and Order updates the political programming and
recordkeeping rules for broadcast licensees, cable television system
operators, Direct Broadcast Satellite (DBS) service providers, and
Satellite Digital Audio Radio Service (SDARS) licensees to conform
these rules with modern campaign practices and statutory requirements
and increase transparency. The Report and Order revises the definition
of ``legally qualified candidate for public office'' to add the use of
social media and creation of a campaign website to the existing list of
campaign-related activities that may be considered in determining
whether an individual running as a write-in candidate has made a
``substantial showing'' of his or her bona fide candidacy. The Report
and Order makes clear that social media presence and campaign websites
will be treated as additional indicators of activities commonly
associated with political campaigning needed to make substantial
showing of a bona fide candidacy, not as determinative factors, and
such digital activities must be combined with other activities commonly
associated with political campaigning that are conducted in substantial
portions of the relevant geographic area.
23. The Report and Order also amends the political file rules
consistent with the Bipartisan Campaign Reform Act of 2002 (BCRA),
which extends the Commission's political file requirements to any
request for the purchase of
[[Page 7752]]
advertising time that ``communicates a message relating to any
political matter of national importance'' (i.e., issue ads) and
specifies the records that must be maintained. The Report and Order
revises the rules to require that broadcast licensees, cable operators,
DBS providers, and SDARS licensees maintain in their online political
files not only records of each request for advertising time that is
made by or on behalf of a legally qualified candidate for public
office, but also records of each request for advertising time that
``communicates a message relating to any political matter of national
importance.'' Further, the Report and Order amends the rules to specify
that the following record must be placed in online political files for
both candidate ads and issue ads:
(1) Whether the request to purchase advertising time is accepted
or rejected by the licensee or regulatee;
(2) the rate charged for the advertising time;
(3) the date and time on which the communication is aired;
(4) the class of time that is purchased;
(5) the name of the candidate to which the communication refers
and the office to which the candidate is seeking election, the
election to which the communication refers, or the issue to which
the communication refers (as applicable);
(6) in the case of a request made by, or on behalf of, a
candidate, the name of the candidate, the authorized committee of
the candidate, and the treasurer of such committee; and
(7) in the case of any other request, the name of the person
purchasing the time, the name, address, and phone number of a
contact person for such person, and a list of the chief executive
officers or members of the executive committee or of the board of
directors of such person.
B. Summary of Significant Issues Raised in Response to the IRFA
24. No comments were filed in response to the IRFA.
C. Response to Comments by the Chief Counsel for Advocacy of the Small
Business Administration
25. Pursuant to the Small Business Jobs Act of 2010, the Commission
is required to respond to any comments filed by the Chief Counsel for
Advocacy of the Small Business Administration (SBA), and to provide a
detailed statement of any change made to the proposed rules as a result
of those comments. The Chief Counsel did not file any comments in
response to the proposed rules in this proceeding.
D. Description and Estimate of the Number of Small Entities To Which
the Rules Will Apply
26. The RFA directs agencies to provide a description of and, where
feasible, an estimate of the number of small entities that entities
that may be affected by the proposed rules, if adopted. The RFA
generally defines the term ``small entity'' as having the same meaning
as the terms ``small business,'' ``small organization,'' and ``small
governmental jurisdiction.'' In addition, the term ``small business''
has the same meaning as the term ``small business concern'' under the
Small Business Act. A small business concern is one which: (1) Is
independently owned and operated; (2) is not dominant in its field of
operation; and (3) satisfies any additional criteria established by the
SBA. The rules proposed herein will directly affect small television
broadcast stations. Below, we provide a description of these small
entities, as well as an estimate of the number of such small entities,
where feasible.
27. The rules adopted herein will directly affect small television
broadcast stations. Below, we provide a description of these small
entities, as well as an estimate of the number of such small entities,
where feasible.
28. Television Broadcasting. This U.S. Economic Census category
``comprises establishments primarily engaged in broadcasting images
together with sound.'' These establishments operate television
broadcast studios and facilities for the programming and transmission
of programs to the public. These establishments also produce or
transmit visual programming to affiliated broadcast television
stations, which in turn broadcast the programs to the public on a
predetermined schedule. Programming may originate in their own studio,
from an affiliated network, or from external sources. The SBA has
created the following small business size standard for such businesses:
those having $41.5 million or less in annual receipts. According to the
2012 Economic Census (when the SBA's size standard was set at $38.5
million or less in annual receipts), 751 firms in the small business
size category operated in that year. Of that number, 656 had annual
receipts of $25 million or less, 25 had annual receipts between $25
million and $49,999,999 and 70 had annual receipts of $50 million or
more. Based on this data, we estimate that the majority of commercial
television broadcast stations are small entities under the applicable
size standard.
29. Additionally, the Commission has estimated the number of
licensed commercial television stations to be 1,372. Of this total,
1,263 stations (or 92%) had revenues of $41.5 million or less in 2019,
according to Commission staff review of the BIA Kelsey Inc. Media
Access Pro Television Database (BIA) on July 30, 2020, and therefore
these stations qualify as small entities under the SBA definition. In
addition, the Commission estimates the number of noncommercial
educational television stations to be 384. The Commission does not
compile and does not have access to information on the revenue of NCE
stations that would permit it to determine how many such stations would
qualify as small entities. There are also 385 Class A stations. Given
the nature of this service, the Commission presumes that all of these
stations qualify as small entities under the applicable SBA size
standard.
30. Radio Broadcasting. This U.S. Economic Census category
``comprises establishments primarily engaged in broadcasting aural
programs by radio to the public.'' Programming may originate in the
establishment's own studio, from an affiliated network, or from
external sources. The SBA has created the following small business size
standard for such businesses: those having $41.5 million or less in
annual receipts. According to Economic Census data for 2012 (when the
SBA's size standard was set at $38.5 million or less in annual
receipts), 2,849 firms in this category operated in that year. Of that
number, 2,806 operated with annual receipts of less than $25 million
per year, 17 with annual receipts between $25 million and $49,999,999
million and 26 with annual receipts of $50 million or more. Based on
this data, we estimate that the majority of commercial radio broadcast
stations were small under the applicable SBA size standard.
31. The Commission has estimated the number of licensed commercial
AM radio stations to be 4,519 and the number of commercial FM radio
stations to be 6,682 for a total of 11,201 commercial stations.
According to Commission staff review of the BIA Kelsey Inc. Media
Access Pro Television Database (BIA) on July 30, 2020, 99% of
commercial radio stations had revenues of $41.5 million or less in
2019, and therefore these stations qualify as small entities under the
SBA definition. In addition, there were 4,211 noncommercial,
educational (NCE) FM stations. The Commission does not compile and does
not have access to information on the revenue of NCE stations that
would permit it to determine how many such stations would qualify as
small entities.
[[Page 7753]]
32. We note, however, that in assessing whether a business concern
qualifies as ``small'' under the above definition, business (control)
affiliations must be included. Our estimate, therefore, likely
overstates the number of small entities that might be affected by our
action, because the revenue figure on which it is based does not
include or aggregate revenues from affiliated companies. In addition,
another element of the definition of ``small business'' requires that
an entity not be dominant in its field of operation. We are unable at
this time to define or quantify the criteria that would establish
whether a specific television broadcast station is dominant in its
field of operation. Accordingly, the estimate of small businesses to
which the rules may apply does not exclude any radio or television
station from the definition of a small business on this basis and is
therefore possibly over-inclusive. An additional element of the
definition of ``small business'' is that the entity must be
independently owned and operated. Because it is difficult to assess
these criteria in the context of media entities, the estimate of small
businesses to which the rules may apply does not exclude any radio or
television station from the definition of a small business on this
basis and similarly may be over-inclusive.
33. Cable Companies and Systems (Rate Regulation Standard). The
Commission has also developed its own small business size standards for
the purpose of cable rate regulation. Under the Commission's rules, a
``small cable company'' is one serving 400,000 or fewer subscribers
nationwide. Industry data indicates that, of the 777 cable companies
currently operating in the United States, 766 serve 400,000 or fewer
subscribers. Additionally, under the Commission's rules, a ``small
system'' is a cable system serving 15,000 or fewer subscribers.
According to industry data, there are currently 4,336 active cable
systems in the United States. Of this total, 3,650 cable systems have
fewer than 15,000 subscribers. Thus, the Commission believes that the
vast majority of cable companies and cable systems are small entities.
34. Cable System Operators (Telecom Act Standard). The
Communications Act of 1934, as amended, also contains a size standard
for small cable system operators, which is ``a cable operator that,
directly or through an affiliate, serves in the aggregate fewer than
one percent of all subscribers in the United States and is not
affiliated with any entity or entities whose gross annual revenues in
the aggregate exceed $250,000,000.'' As of 2019, there were
approximately 48,646,056 basic cable video subscribers in the United
States. Accordingly, an operator serving fewer than 486,460 subscribers
shall be deemed a small operator if its annual revenues, when combined
with the total annual revenues of all its affiliates, do not exceed
$250 million in the aggregate. Based on available data, we find that
all but five cable operators are small entities under this size
standard. We note that the Commission neither requests nor collects
information on whether cable system operators are affiliated with
entities whose gross annual revenues exceed $250 million. Therefore, we
are unable at this time to estimate with greater precision the number
of cable system operators that would qualify as small cable operators
under the definition in the Communications Act.
35. Direct Broadcast Satellite (DBS) Service. DBS service is a
nationally distributed subscription service that delivers video and
audio programming via satellite to a small parabolic dish antenna at
the subscriber's location. For the purposes of economic classification,
establishments providing satellite television distribution services
using facilities and infrastructure that they operate are included in
the Wired Telecommunications Carriers industry. The Wired
Telecommunications Carriers industry comprises establishments primarily
engaged in operating and/or providing access to transmission facilities
and infrastructure that they own and/or lease for the transmission of
voice, data, text, sound, and video using wired telecommunications
networks. Transmission facilities may be based on a single technology
or combination of technologies. Establishments in this industry use the
wired telecommunications network facilities that they operate to
provide a variety of services, such as wired telephony services,
including VoIP services, wired (cable) audio and video programming
distribution; and wired broadband internet services. The SBA determines
that a wireline business is small if it has fewer than 1,500 employees.
Economic census data for 2012 indicate that 3,117 wireline companies
were operational during that year. Of that number, 3,083 operated with
fewer than 1,000 employees. Based on that data, we conclude that the
majority of wireline firms are small under the applicable standard.
However, currently only two entities provide DBS service, which
requires a great deal of capital for operation: DIRECTV (owned by AT&T)
and DISH Network. According to industry data, DIRECTV and DISH serve
14,831,379 and 8,957,469 subscribers respectively, and count the third
and fourth most subscribers of any multichannel video distribution
system in the U.S. Given the capital required to operate a DBS service,
its national scope, and the approximately one-third share of the video
market controlled by these two companies, we presume that neither would
qualify as a small business.
36. Satellite Radio. Sirius-XM, which offers subscription services,
is the sole, current U.S. provider of satellite radio (SDARS) services,
Sirius-XM. Sirius-XM reported revenue of $8.04 billion and a net income
of $131 million in 2020. In light of these figures, we believe it is
unlikely that this entity would be considered small
E. Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements for Small Entities
37. In this section, we identify the reporting, recordkeeping, and
other compliance requirements adopted in the Report and Order and
consider whether small entities are affected disproportionately by any
such requirements.
38. Reporting Requirements. The Report and Order does not adopt any
new or modified reporting requirements.
39. Recordkeeping Requirements. The Report and Order revises the
political file rules, consistent with the BCRA's amendment to Section
315(e) of the Act, to reflect the statutory requirements that broadcast
licensees, cable television system operators, DBS providers, and SDARS
licensees are obligated to maintain in their online political
inspection files records of each request for advertising time that ``is
made on behalf of a legally qualified candidate for public office'' and
each request for advertising time that ``communicates a message
relating to any political matter of national importance'' (i.e., issue
ads). In addition, the Report and Order revises the political file
rules to list the specific records that must be maintained in political
files.
40. Other Compliance Requirements. The Report and Order revises the
political programming rules to add the use of social media and the
creation of campaign websites to the list of activities that may be
considered in determining whether an individual who is running as a
write-in candidate has made a ``substantial showing'' of his or her
bona fide candidacy.
[[Page 7754]]
F. Steps Taken To Minimize Significant Economic Impact on Small
Entities and Significant Alternatives Considered
41. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its proposed approach,
which may include the following four alternatives (among others): ``(1)
the establishment of differing compliance or reporting requirements or
timetables that take into account the resources available to small
entities; (2) the clarification, consolidation, or simplification of
compliance and reporting requirements under the rule for such small
entities; (3) the use of performance, rather than design standards; and
(4) an exemption from coverage of the rule, or any part thereof, for
small entities.''
42. The Report and Order revises the political programming and
political file rules to bring them into conformity with modern campaign
practices and statutory requirements. As discussed below, the updates
are not expected to significantly impact small entities.
43. The changes in the Recordkeeping Requirements merely conform
our rules with the statutory requirements in Section 315(e) of the Act,
which was added in 2002 by the BCRA. The Commission has provided
guidance on political recordkeeping consistent with these statutory
requirements since their adoption in 2002. The revisions ensure that
the political file rules fully and accurately reflect the statutory
requirements.
44. The changes in the Compliance Requirements conform with modern
campaign practices. NAB states that these changes will not drastically
alter current industry practices because broadcasters already consider
digital activities in determining whether an individual has made a
substantial showing that he or she is a bona fide candidate.
G. Report to Congress
45. The Commission will send a copy of the Report and Order,
including this FRFA, in a report to be sent to Congress pursuant to the
Congressional Review Act. In addition, the Commission will send a copy
of the Report and Order, including this FRFA, to the Chief Counsel for
Advocacy of the SBA. The Report and Order and FRFA (or summaries
thereof) will also be published in the Federal Register.
Ordering Clauses
46. Accordingly, it is ordered, pursuant to the authority contained
in Sections 1, 4(i), 4(j), 303, 307, 312, 315, and 335 of the
Communications Act, as amended, 47 U.S.C 151, 154(i), 154(j), 303, 307,
312, 315, and 335, that this Report and Order is adopted.
47. It is further ordered that the Commission's rules are hereby
amended as set forth below.
48. It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of this Report and Order including the Regulatory Flexibility
Analysis, to the Chief Counsel for Advocacy of the Small Business
Administration.
List of Subjects in 47 CFR Parts 25, 73, and 76
Cable television, Political candidates, Radio, Reporting and
recordkeeping requirements, Satellites, Television.
Federal Communications Commission.
Katura Jackson,
Federal Register Liaison Officer.
Final Rules
For the reasons discussed in the preamble, the Federal
Communications Commission amends 47 CFR parts 25, 73, and 76 as
follows:
PART 25--SATELLITE COMMUNICATIONS
0
1. The authority citation for part 25 continues to read as follows:
Authority: 47 U.S.C. 154, 301, 302, 303, 307, 309, 310, 319,
332, 605, and 721.
0
2. Delayed indefinitely, amend Sec. 25.701 by revising paragraph (d)
to read as follows:
Sec. 25.701 Other DBS Public interest obligations.
* * * * *
(d) Political file. (1) Each DBS operator engaged in origination
programming shall maintain, and make available for public inspection, a
complete record of a request to purchase adverting time that:
(i) Is made by or on behalf of a legally qualified candidate for
public office; or
(ii) Communicates a message relating to any political matter of
national importance, including:
(A) A legally qualified candidate;
(B) Any election to Federal office; or
(C) A national legislative issue of public importance.
(2) A record maintained under this paragraph shall contain
information regarding:
(i) Whether the request to purchase advertising time is accepted or
rejected by the DBS operator;
(ii) The rate charged for the advertising time;
(iii) The date and time on which the communication is aired;
(iv) The class of time that is purchased;
(v) The name of the candidate to which the communication refers and
the office to which the candidate is seeking election, the election to
which the communication refers, or the issue to which the communication
refers (as applicable);
(vi) In the case of a request made by, or on behalf of, a
candidate, the name of the candidate, the authorized committee of the
candidate, and the treasurer of such committee; and
(vii) In the case of any other request, the name of the person
purchasing the time, the name, address, and phone number of a contact
person for such person, and a list of the chief executive officers or
members of the executive committee or of the board of directors of such
person.
(3) When free time is provided for use by or on behalf of
candidates, a record of the free time provided shall be placed in the
political file.
(4) All records required by this paragraph shall be placed in the
online public file hosted by the Commission as soon as possible and
shall be retained for a period of two years. As soon as possible means
immediately absent unusual circumstances.
* * * * *
0
3. Delayed indefinitely, amend Sec. 25.702 by revising paragraph (b)
to read as follows:
Sec. 25.702 Other SDARS Public interest obligations.
* * * * *
(b) Political file. (1) Each SDARS licensee engaged in origination
programming shall maintain, and make available for public inspection, a
complete record of a request to purchase broadcast time that:
(i) Is made by or on behalf of a legally qualified candidate for
public office; or
(ii) Communicates a message relating to any political matter of
national importance, including:
(A) A legally qualified candidate;
(B) Any election to Federal office; or
(C) A national legislative issue of public importance.
(2) A record maintained under this paragraph shall contain
information regarding:
(i) Whether the request to purchase broadcast time is accepted or
rejected by the licensee;
(ii) The rate charged for the broadcast time;
(iii) The date and time on which the communication is aired;
(iv) The class of time that is purchased;
(v) The name of the candidate to which the communication refers and
the
[[Page 7755]]
office to which the candidate is seeking election, the election to
which the communication refers, or the issue to which the communication
refers (as applicable);
(vi) In the case of a request made by, or on behalf of, a
candidate, the name of the candidate, the authorized committee of the
candidate, and the treasurer of such committee; and
(vii) n the case of any other request, the name of the person
purchasing the time, the name, address, and phone number of a contact
person for such person, and a list of the chief executive officers or
members of the executive committee or of the board of directors of such
person.
(3) When free time is provided for use by or on behalf of
candidates, a record of the free time provided shall be placed in the
political file.
(4) All records required by this paragraph shall be placed in the
online public file hosted by the Commission as soon as possible and
shall be retained for a period of two years. As soon as possible means
immediately absent unusual circumstances.
* * * * *
PART 73--RADIO BROADCAST SERVICES
0
4. The authority citation for part 73 continues to read as follows:
Authority: 47 U.S.C. 154, 303, 309, 310, 334, 336, and 339.
0
5. Effective March 14, 2022, amend Sec. 73.1940 by revising paragraph
(f) to read as follows:
Sec. 73.1940 Legally qualified candidates for public office.
* * * * *
(f) The term ``substantial showing'' of a bona fide candidacy as
used in paragraphs (b), (d), and (e) of this section means evidence
that the person claiming to be a candidate has:
(1) Satisfied the requirements under applicable law to run as a
write-in (such as registering, collecting signatures, paying fees,
etc.); and
(2) Has engaged to a substantial degree in activities commonly
associated with political campaigning. Such activities normally would
include making campaign speeches, distributing campaign literature,
issuing press releases, maintaining a campaign committee, establishing
campaign headquarters (even though the headquarters in some instances
might be the residence of the candidate or his or her campaign
manager), creating a campaign website, and using social media for the
purpose of promoting or furthering a campaign for public office. Not
all of the listed activities are necessarily required in each case to
demonstrate a substantial showing, and there may be activities not
listed herein which would contribute to such a showing. The creation of
a campaign website and the use of social media shall be additional
indicators of a bona fide candidacy, not determinative factors, and
such digital activities must be combined with other activities commonly
associated with political campaigning that are conducted in substantial
portions of the relevant geographic area.
0
6. Delayed indefinitely, amend Sec. 73.1943 by revising paragraph (a),
redesignating paragraphs (b) and (c) as paragraphs (c) and (d), and
adding new paragraph (b).
The revision and addition read as follows:
Sec. 73.1943 Political file.
(a) A licensee shall maintain, and make available for public
inspection, a complete record of a request to purchase broadcast time
that:
(1) Is made by or on behalf of a legally qualified candidate for
public office; or
(2) Communicates a message relating to any political matter of
national importance, including:
(i) A legally qualified candidate;
(ii) Any election to Federal office; or
(iii) A national legislative issue of public importance.
(b) A record maintained under paragraph (a) shall contain
information regarding:
(1) Whether the request to purchase broadcast time is accepted or
rejected by the licensee;
(2) The rate charged for the broadcast time;
(3) The date and time on which the communication is aired;
(4) The class of time that is purchased;
(5) The name of the candidate to which the communication refers and
the office to which the candidate is seeking election, the election to
which the communication refers, or the issue to which the communication
refers (as applicable);
(6) In the case of a request made by, or on behalf of, a candidate,
the name of the candidate, the authorized committee of the candidate,
and the treasurer of such committee; and
(7) In the case of any other request, the name of the person
purchasing the time, the name, address, and phone number of a contact
person for such person, and a list of the chief executive officers or
members of the executive committee or of the board of directors of such
person.
* * * * *
PART 76--MULTICHANNEL VIDEO AND CABLE TELEVISION SERVICE
0
7. The authority citation for part 76 continues to read as follows:
Authority: 47 U.S.C. 151, 152, 153, 154, 301, 302, 302a, 303,
303a, 307, 308, 309, 312, 315, 317, 325, 339, 340, 341, 503, 521,
522, 531, 532, 534, 535, 536, 537, 543, 544, 544a, 545, 548, 549,
552, 554, 556, 558, 560, 561, 571, 572, 573.
0
8. Effective March 14, 2022, amend Sec. 76.5 by revising paragraph
(q)(5) to read as follows:
Sec. 76.5 Definitions.
* * * * *
(q) * * *
(5) The term ``substantial showing'' of a bona fide candidacy as
used in paragraphs (q)(2) through (4) of this section means evidence
that the person claiming to be a candidate has:
(i) Satisfied the requirements under applicable law to run as a
write-in (such as registering, collecting signatures, paying fees,
etc.); and
(ii) Has engaged to a substantial degree in activities commonly
associated with political campaigning. Such activities normally would
include making campaign speeches, distributing campaign literature,
issuing press releases, maintaining a campaign committee, establishing
campaign headquarters (even though the headquarters in some instances
might be the residence of the candidate or his or her campaign
manager), creating a campaign website, and using social media for the
purpose of promoting or furthering a campaign for public office. Not
all of the listed activities are necessarily required in each case to
demonstrate a substantial showing, and there may be activities not
listed herein which would contribute to such a showing. The creation of
a campaign website and the use of social media shall be additional
indicators of a bona fide candidacy, not determinative factors, and
such digital activities must be combined with other activities commonly
associated with political campaigning that are conducted in substantial
portions of the relevant geographic area.
* * * * *
0
9. Delayed indefinitely, amend Sec. 76.1701 by revising paragraph (a),
redesignating paragraphs (b) through (d) as paragraphs (c) through (e),
and adding new paragraph (b).
The revision and addition read as follows:
[[Page 7756]]
Sec. 76.1701 Political file.
(a) Every cable television system operator engaged in origination
programming shall maintain, and make available for public inspection, a
complete record of a request to purchase cablecast time that:
(1) Is made by or on behalf of a legally qualified candidate for
public office; or
(2) Communicates a message relating to any political matter of
national importance, including:
(i) A legally qualified candidate;
(ii) Any election to Federal office; or
(iii) A national legislative issue of public importance.
(b) A record maintained under paragraph (a) shall contain
information regarding:
(1) Whether the request to purchase cablecast time is accepted or
rejected by the cable television system operator;
(2) The rate charged for the cablecast time;
(3) The date and time on which the communication is aired;
(4) The class of time that is purchased;
(5) The name of the candidate to which the communication refers and
the office to which the candidate is seeking election, the election to
which the communication refers, or the issue to whih the communication
refers (as applicable);
(6) In the case of a request made by, or on behalf of, a candidate,
the name of the candidate, the authorized committee of the candidate,
and the treasurer of such committee; and
(7) In the case of any other request, the name of the person
purchasing the time, the name, address, and phone number of a contact
person for such person, and a list of the chief executive officers or
members of the executive committee or of the board of directors of such
person.
* * * * *
[FR Doc. 2022-02484 Filed 2-9-22; 8:45 am]
BILLING CODE 6712-01-P
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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.