Background on FCC Underwriting Actions

Over the last few months, the Federal Communications Commission has released a wave of penalties against noncommercial stations. What’s the problem?
 
The issue at hand is underwriting language. The FCC has presented specific rules on the noncommercial nature of community, college and public broadcasters. While the rules seem general, the standards must be followed. Failure to do so can create financial headaches for your station.
 
Of note, a handful of stations were caught violating the regulations and received thousands of dollars in fines. Let’s take a look at the recent cases:

  • The Cossatot Community College of the University of Arkansas’ two stations, KBPU of De Queen, Arkansas, and KTYC of Nashville, Arkasnsas, were fined $76,000 and will be required to implement a five-year compliance plan coordinated with the FCC’s Enforcement Bureau. According to the FCC, the stations aired multiple announcements that promoted for-profit underwriters’ products and/or services that contained qualitative descriptions and comparative language, pricing information, as well as calls to action. The school has been permitted to pay the fine over four payments.
  • The Cesar Chavez Foundation was hit with a $115,000 fine and a one-year moratorium on underwriting announcements from commercial entities because of underwriting language that aired on community radio KNAI-FM and KUFW. CCF violated the Commission’s underwriting regulations by airing announcements from August 2016 to March 2017, which promoted for-profit underwriters’ products and services and contained qualitative descriptions as well as comparative language, pricing information and calls to action.
  • San Tan Educational Media, licensee of low-power FM station KFXY-LP, accepted a $1,500 fine for several issues, including airing announcements that had promoted donors’ businesses or services in impermissible ways. Of note was the length of the spots, which implied commercialism.

The FCC is also said to be looking into a group of low-power FM community stations, following a complaint alleging underwriting violations. The complainant suggests a joint rate card that includes spot rates and classes of time for each station constitutes a violation. The LPFMs deny wrongdoing. Further action is pending.
 
What are the baseline rules related to underwriting announcements? While there are many nuances, in general, your community radio station should respect the following core approaches:

  • Do not make comparisons between an underwriter’s products or services and those of that organization’s competitors.
  • Do not make qualitative statements about an underwriter, such as regarding trustworthiness.
  • Do not include information on prices, savings or value.
  • Do not make calls to action, such as asking a listener “are you ready?”
  • Do not list a “menu” of products or services offered by an underwriter.
  • Do not create long spots (i.e. not longer than 30 seconds) for an underwriter.

Need more assistance? Are you concerned about your community radio station violating underwriting rules? Want to keep your station out the next round of FCC consent decrees? Join us in March for a webinar on underwriting copy, featuring public media veteran Beverly James.

NFCB members can log in to NFCB’s Solution Center for webinars, guides and other great underwriting materials.

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