Political Consultants Will Scramble Under New FCC Light

Cockroaches, otherwise known as political consultants will be scrambling to find new dark places to hide after the Federal Communications Commission this week adopted rules to require cable operators, satellite television (DBS) providers, and broadcast radio and satellite radio licensees to post their public and political files to the FCC’s online public inspection file database.

Now, organizations like Sean Noble’s “American Encore,” dubbed a “washing machine” by the Arizona Politics blog, which ran “the dark money portion of Doug Ducey’s Arizona gubernatorial campaign, funneling money to various groups which – combined with AE’s own ads – resulted in more than $3.3M in anonymized spending,” will have to work in the sunlight.

According to Arizona Politics:

“… Noble’s personal companies netted more than $1.8M, and American Encore retained nearly $3.5M going into the quiet 2015 year (ready to spend this year)…. The sources of the $5.4M contributed to American Encore in 2013-14 are entirely secret, leading to the use of the term “dark money…. American Encore is a 501(c)(4) social welfare organization. Its required IRS filing for 2014 was made this past November and just became publicly available this month. (That is part of the problem with the patchwork of disclosure laws – untimely disclosures which organizations can take advantage of.)

AE started 2014 off with $8.5M in the bank, and brought in $3.2M during the year. Of the $7.9M spent during the year, most – $5.1M was either directly spent in Arizona or went to groups that have been focused on Arizona races. Here is the breakdown.

The Commission adopted online public file rules for broadcast television licensees in 2012, moving television public files online to a central, Commission-hosted database rather than maintaining files locally at their main studios. TV broadcasters completed their transition to the online file in July 2014. Modernizing the filing process made it easier for consumers to access information about their broadcast services without having to travel to the station’s main studio and reduced the cost of broadcaster compliance.

The rules adopted today extend the online file to these additional entities and include a number of measures to minimize the effort and cost associated with moving the public files online. Specifically, the rules adopted are:

• Require entities to upload to the online file only public file documents that are not already on file with the Commission or maintained by the Commission in its own database; the Commission will include in the online file documents already on file with the Commission;

• Exempt existing political file material from the online file requirement and require that political file documents be uploaded only on a going-forward basis, consistent with the approach taken in the television transition;

• Exempt cable systems with fewer than 1,000 subscribers from all online file requirements, as these systems have few public file requirements and are not required to maintain a political file;

• Delay for two years the requirement to upload new political file material to the online file for cable systems with between 1,000 and 5,000 subscribers, similar to the approach taken toward smaller television stations in the television transition;

• With respect to radio broadcasters, impose the online file requirement initially only on commercial stations in the top 50 Nielsen Audio markets with 5 or more full-time employees while delaying for two years all mandatory online public file requirements for other radio stations;

• Permit entities that are temporarily exempt from part or all online public file requirements to upload material to the online file voluntarily before the delayed effective date of their online file requirement;

• Permit entities that have fully transitioned to the online public file to cease maintaining a local public file, as long as they provide online access to back-up political file material via the entity’s own website if the FCC’s online file database becomes temporarily unavailable.

The action furthers the Commission’s effort to modernize the way consumers are able to access information about a station’s or other video program provider’s programming, operations, and compliance with the FCC’s rules, including candidate requests for political advertising time. Public inspection files have been maintained for decades at the local station, cable office, or DBS or satellite radio headquarters office. The Commission’s online database makes these files easier to access, reducing consumer time and expense as well as the long-term costs for government and the private sector. The new rules would not impose new or modified public file requirements, with some streamlining exceptions.

The public file database is available on the Commission’s website at https://stations.fcc.gov/.

Action by the Commission January 28, 2016 by Report and Order (FCC 16-004). Chairman Wheeler and Commissioners Clyburn, Rosenworcel, and O’Rielly approving and issuing separate statements. Commissioner Pai approving in part and concurring in part and issuing separate statement.

1 Comment

  1. Dark Money = Dirty Money. It would be nice to see where all this money is coming from and from whom because what little spending money that I have; I would like to spend it with companies that actually do something good for everyone.

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