Campaigns & Elections' Political Broadcast Manual - March 2008 - (Page 32)

If rebates are required, they must be calculated on a periodic basis and made promptly - and, to the extent practical, within a useful time frame. The FCC expects stations to make rebates on an even more expeditious basis as Election Day draws closer. Rotations Many stations use various forms of rotators to sell preemptible time. The FCC recognizes distinctly different rotations as separate periods of time for calculating the LUC even if rotators overlap. In analyzing the reasonableness of a station’s determination, the FCC will consider whether two ostensibly different rotations are consistent with the station’s normal selling practices and are based upon objective criteria such as varying audience size or demographics which warrant differences in their prices. A station must disclose to candidates either all of its rotations or a complete summary of its procedures for identifying all possible rotations that can be purchased. The FCC also recognizes that prices may vary from week to week and even day to day. Stations may calculate the LUC solely on the basis of spots that ran during the relevant 24-hour period, even if some of the spots were the result of contracts that are in effect over the course of several weekly rotations. Assume that a commercial advertiser has bought a 13-week rotation and at the time of the purchase the price per spot was $200. During the course of that rotation, the station increases its rates to other commercial advertisers to $250. The political advertiser must pay no more than $200 even though commercial advertisers may be charged more, if one of those $200 13-week rotation ads was left to run in the 24-hour period surrounding the candidate’s ad. Package Plans, Volume Discounts and Bonus Spots The FCC does not consider package plans or bonus spots to be a separate classification of time. All rates and bonuses offered to commercial advertisers in packages must be included in LUC calculations. This includes all packages and bonus spots, whether individually negotiated or available to every advertiser. When the package is simply a volume discount within a single class of spot, then the unit rate for each spot within the package is the package price divided by the total number of spots. When a package contains spots in more than one class or time period, though, a broadcaster may allocate the package price among the spots in each class or time period. Otherwise, the rotation may establish a new lowest unit rate for other classes of time within the rotation. Determining the value of bonus spots or spots within a package can be illustrated as follows. If a radio station sells five morning drive spots for $1000 and throws in another five morning drive spots at no charge, the average cost of the spots for LUC purposes would be $100 (that is, the $1000 total price divided by the ten total morning drive spots). If, though, the station were to sell the five morning drive spots for $1000 and then throw in another five ROS spots at no charge, the station could value the ROS spots at the LUC for that class of time (for example, $10 each), resulting in a lowest unit rate for the drive time spots of $190. Thus, a station may allocate an ROS package over its various classes of time in which the spot will run and assign different values to them. The FCC also recognizes that the spots in a package sold over a long period of time will have different values in different seasons, and will allow the allocation of those spots over time. Thus a 26-week package of afternoon drive radio spots, sold in March, may be assigned different values in April, July and September. The prices assigned to each spot in the package must be documented, either on the face of the contract or invoice or on a separate internal memorandum. If a separate memorandum is used, it should be prepared simultaneously with the formation of the contract and should be signed and dated by an authorized representative of the station. Moreover, if the pertinent rates for LUC purposes are included on the separate document but are different from the value reflected in the contract and/ or invoice (which may reflect only an average rate or total cost), then the information on the separate document should be either included in the public file or otherwise disclosed to candidates seeking to purchase time. Non-Cash Incentives Non-cash merchandising and promotional incentives which have minimal value (such as coffee mugs) or which might imply a relationship between the station and an advertiser (such as a bumper sticker) need not be offered to candidates. A more substantial incentive (such as a vacation) would have to be offered to any political advertiser who became eligible by purchasing the required amount of advertising. Billboards and Promotional Announcements Billboards (i.e.: brief promotional announcements preceding or following a sponsored program) and announcements of upcoming programming need not be offered to political advertisers, nor must their value be factored into lowest unit rate calculations for the class and time period in which they appear. The FCC’s exemption of these types of bonuses is premised upon the impracticality of including the required political sponsorship identification in such mentions, which are generally quite brief. 32 « March 2008

Table of Contents Feed for the Digital Edition of Campaigns & Elections' Political Broadcast Manual - March 2008

Campaigns & Elections' Political Broadcast Manual - March 2008 Contents Introduction – The Scope of the Political Broadcasting Rules “Legally Qualified” Candidates Reasonable Access “Uses” of Broadcast Facilities Exempt Programs Requests for Equal Opportunities Equal Opportunities Lowest Unit Charges The Disclosure Censorship of Uses Sponsorship Identification Political File Contents Access to the Political File The Fairness Doctrine Political Editorials Personal Attacks Issue Advertising News Distortion Conclusion

Campaigns & Elections' Political Broadcast Manual - March 2008

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