Federal Election Commission Main Page
FEDERAL ELECTION COMMISSION
Washington, DC 20463
December 9, 2005
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
ADVISORY OPINION 2005-19
Mr. Emil Franzi
Inside Track Productions
P.O. Box 2128
Tucson, AZ 85702
Dear Mr. Franzi:
We are responding to your advisory opinion request
concerning the application of the Federal Election Campaign
Act of 1971, as amended (the "Act"), and Commission
regulations to "The Inside Track," a weekly radio program
that you produce and air in Tucson, Arizona. The Commission
concludes that any discussion and interviewing of Federal
candidates on "The Inside Track" program within 30 days of a
primary election or 60 days of a general election is exempt
from the prohibition on corporate funding of electioneering
communications under the press exemption in the Act and
Commission regulations. Moreover, any costs incurred in the
production and broadcast of The Inside Track are similarly
exempt from the Act's prohibitions on corporate
contributions and expenditures under the press exemption.
Background
The facts presented in this advisory opinion are based
on your letter received on October 13, 2005, and phone
conversations that occurred on October 18, 2005 and November
15, 2005.
You are the host of the radio talk show "The Inside
Track," which is broadcast on KJLL in Tucson, Arizona. KJLL
broadcasts to virtually the entire metropolitan area of
Tucson, reaching a potential audience of approximately
400,000 people, including at least 50,000 people in both
Arizona's Seventh and Eighth Congressional Districts. You
also operate a for-profit corporation, Paradigm Shift
Productions, which purchases airtime on KJLL in order to air
The Inside Track. Paradigm Shift Productions then sells
advertising on the program to recoup the costs of the
airtime.
Neither Paradigm Shift Productions nor KJLL is in any
way owned or controlled by any political party, political
committee, or candidate. In addition, you are not an
officer or employee of any political party or political
committee. Finally, you are not currently a candidate for
Federal office.
Politics is the major focus of discussion on The Inside
Track. As a result, throughout 2006 the program will
include discussions of candidates for the United States
Senate and House of Representatives, interviews with these
candidates, and comments and questions from callers that
mention these candidates. You have stated that the
candidates you will discuss and interview include those
running for Senate in Arizona and for the House of
Representatives in Arizona's Seventh and Eight Congressional
Districts. These activities would occur within 30 days of
the Arizona primary election on September 12, 2006 or 60
days of the November 7, 2006 general election.
Question Presented
May Paradigm Shift Productions produce The Inside Track
and purchase airtime to broadcast it within 30 days of a
primary election or 60 days of a general election if the
program mentions or clearly identifies a Federal candidate?
Legal Analysis and Conclusions
The Commission concludes that Paradigm Shift
Productions may produce The Inside Track and purchase
airtime to broadcast it within 30 days of a primary election
or 60 days of a general election if the program mentions or
clearly identifies a Federal candidate because the proposed
activities fall within the press exemptions to the
prohibition on corporate funding of electioneering
communications and the definitions of "contribution" and
"expenditure."1
I. Electioneering Communications
The Act and Commission regulations define an
"electioneering communication" as any broadcast, cable, or
satellite communication that refers to a clearly identified
candidate for Federal office; is publicly distributed for a
fee2 within 60 days before a general, special or runoff
election for the office sought by the candidate, or within
30 days before a primary or preference election for the
office sought by the candidate; and in the case of a
candidate for the U.S. Senate or House of Representatives,
is targeted to the relevant electorate. See 2 U.S.C.
434(f)(3) and 11 CFR 100.29(a). A communication is targeted
to the relevant electorate if it can be received by 50,000
or more persons:
(1) in the district the candidate seeks to represent,
in the case of a candidate for Representative; or
(2) in the State the candidate seeks to represent, in
the case of a candidate for Senator. 2 U.S.C. 434(f)(3)(C);
11 CFR 100.29(b)(5).
Any broadcast of The Inside Track that refers to a
clearly identified candidate for the Senate in Arizona, or
for the House of Representatives in the Seventh or Eighth
Congressional Districts of Arizona during the electioneering
communication windows would satisfy the general test for an
electioneering communication. It would be publicly
distributed for a fee because it would be broadcast through
the facilities of a radio station and Paradigm Shift
Productions would purchase the airtime. 11 CFR
100.29(b)(3)(i). Because KJLL is capable of reaching more
than 50,000 listeners in the State of Arizona, including in
the Seventh and Eighth Congressional Districts of Arizona,
the communication would be targeted to the relevant
electorate of Arizona Senatorial candidates and Seventh and
Eighth District House candidates. 11 CFR 100.29(b)(5).
II. Electioneering Communications Press Exemption
Corporations are generally prohibited from making or
financing electioneering communications. 2 U.S.C.
441b(b)(2) and 11 CFR 114.2(b)(2)(iii). However, the Act
and Commission regulations provide an exemption for any
communication that appears in a news story, commentary, or
editorial distributed through the facilities of any
broadcast, cable, or satellite television or radio station,
unless such facilities are owned or controlled by any
political party, political committee, or candidate, in which
case additional limitations apply. 2 U.S.C. 434(f)(3)(B)(i)
and 11 CFR 100.29(c)(2). This exclusion is known as the
"press exemption."
The Commission has applied a two-step analysis to
determine whether the press exemption applies. First, the
Commission asks whether the entity engaging in the activity
is a press entity as described by the Act and Commission
regulations. See e.g. Advisory Opinions 2005-16, 2004-07,
2003-34, 2000-13, and 1998-17. The analysis of whether an
entity is a press entity does not necessarily turn on the
presence or absence of any one particular fact. Second, in
determining the scope of the exemption, the Commission
considers: (1) whether the press entity is owned or
controlled by a political party, political committee, or
candidate; and (2) whether the press entity is acting as a
press entity in conducting the activity at issue (i.e.,
whether the entity is acting in its "legitimate press
function"). See Reader's Digest Association v. FEC, 509 F.
Supp. 1210, 1215 (S.D.N.Y. 1981); FEC v. Phillips
Publishing, 517 F. Supp. 1308, 1312-1313 (D.D.C. 1981);
Advisory Opinions 2005-16, 2004-07, 2000-13, 1996-48, and
1982-44.
Paradigm Shift Productions is in the business of
producing on a regular basis a radio program that
disseminates news stories, commentary and/or editorials. It
also buys airtime to broadcast the program and resells some
of that airtime for third party advertisements. Therefore,
the Commission concludes that Paradigm Shift Productions is
a press entity.
The Commission also concludes that Paradigm Shift
Productions would be acting as a press entity when
conducting the proposed activity. Because The Inside Track
will discuss political issues through a radio broadcast, any
reference to a clearly identified Federal candidate during
its broadcast would occur "in a news story, commentary, or
editorial." 11 CFR 100.29(c)(2). See also Advisory Opinion
2005-16 (availability of an entity's activities "to the
general public" is a key consideration in determining
whether the press exemption applies). Paradigm Shift
Productions was created to produce and disseminate this
radio program, and therefore would be acting in its
legitimate press function when it distributes The Inside
Track.3
Your request specifically identifies three scenarios
where The Inside Track would broadcast a communication that
refers to a Federal candidate during the electioneering
communications timeframe: (1) you, as the program host,
mention a candidate on the air, (2) a candidate is
interviewed on the program, and (3) a person calling into
the program mentions a candidate. The Commission concludes
that all of these activities during The Inside Track's
broadcast would be legitimate press functions; thus they
would come within the press exemption in the Act and
Commission regulations.4 Therefore, Paradigm Shift
Productions may produce, and purchase airtime for, the
program that mentions or clearly identifies a Federal
candidate, including when you mention a candidate, a
candidate is interviewed and when a caller mentions a
candidate, without violating the prohibition on corporate
funding of electioneering communications.5
III. Contributions and Expenditures Press Exemption
For the reasons described above, the proposed
activities would not violate the Act's prohibition on
corporate contributions and expenditures. The Act prohibits
"any corporation whatever" from making any contribution or
expenditure in connection with a Federal election. 2 U.S.C.
441b(a). The Act and Commission regulations define the
terms "contribution" and "expenditure" to include any gift
of money or "anything of value" for the purpose of
influencing a Federal election. See 2 U.S.C. 431(8)(A) and
(9)(A); 11 CFR 100.52(a) and 100.111(a). However, there is
an exemption for "any cost incurred in covering or carrying
a news story, commentary, or editorial by any broadcasting
station (including a cable television operator, programmer
or producer), newspaper, magazine, or other periodical
publication . . . unless the facility is owned or controlled
by any political party, political committee, or
candidate[.]" 11 CFR 100.73 and 11 CFR 100.132; see also 2
U.S.C. 431(9)(B)(i). As in the electioneering communication
context, this exclusion is also known as the "press
exemption." According to the House Report on the 1974
amendments to the Act, the press exemption made plain
Congress's intent that the Act would not "limit or burden in
any way the first amendment freedoms of the press" and would
assure "the unfettered right of the newspapers, TV networks,
and other media to cover and comment on political
campaigns." H.R. Rep. No. 93-1239, 93d Cong., 2d Sess. at 4
(1974).
This exemption would apply to The Inside Track and
Paradigm Shift Productions. As discussed above, Paradigm
Shift Productions is a press entity. Its production of, and
purchasing of airtime for, The Inside Track constitutes
"covering or carrying a news story, commentary, or
editorial." The Commission notes that an entity otherwise
eligible for the press exemption would not lose its
eligibility merely because of a lack of objectivity in a
news story, commentary, or editorial, even if the news
story, commentary, or editorial expressly advocates the
election or defeat of a clearly identified candidate for
Federal office. See First General Counsel's Report, MUR
5449 (CBS Broadcasting, Inc.) ("Even seemingly biased
stories or commentary by a press entity can fall within the
media exemption."). See also Advisory Opinion 2005-16. The
proposed activities described in your request would come
within the exemption in 2 U.S.C. 431(9)(B)(i) and would not
violate 2 U.S.C. 441b. See also 11 CFR 100.73 and 11 CFR
100.132. Therefore, any disbursements made to produce or
broadcast The Inside Track are not prohibited corporate
contributions or expenditures under the Act.
This response constitutes an advisory opinion
concerning the application of the Act and Commission
regulations to the specific transaction or activity set
forth in your request. See 2 U.S.C. 437f. The Commission
emphasizes that, if there is a change in any of the facts or
assumptions presented, and such facts or assumptions are
material to a conclusion presented in this advisory opinion,
then the requestor may not rely on that conclusion as
support for its proposed activity.
Sincerely,
(signed)
Scott E. Thomas
Chairman
Enclosures: Advisory Opinions 2005-16, 2004-07, 2003-34,
2000-13, 1998-17, 1996-48,
1987-08, and 1982-44
_______________________________
1 While your request specifically addresses the question of
communications during the electioneering communications time
frames, it also implicates the Act's prohibitions on
corporate contributions and expenditures.
2 The "for a fee" requirement of the electioneering
communications test has been the subject of litigation in
Shays v. FEC, 337 F. Supp. 2d 28 (D.D.C. 2004), aff'd, 414
F.3d 76 (D.C. Cir 2005), petition for rehearing en banc
denied Oct. 21, 2005. The United States Court of Appeals
for the District of Columbia Circuit affirmed the District
Court's ruling that the addition of the "for a fee"
requirement violated Congress's clearly expressed intent
under step one of the analysis required by Chevron U.S.A. v.
Natural Res. Def. Council, 467 U.S. 837 (1984). 414 F.3d at
109. The Commission has a pending rulemaking to determine
how to amend the electioneering communication regulations to
comply with these court opinions. However, the analysis in
this advisory opinion is not dependent on the "for a fee"
requirement.
3 The Commission also notes that neither Paradigm Shift
Productions nor KJLL are owned or controlled by any
political party, political committee, or candidate.
4 The Commission has previously determined that on-air
interviews of candidates are within the press exemption,
provided that the broadcaster complies with all applicable
requirements of the Communications Act (47 U.S.C. 315(a) and
(b)) and Federal Communications Commission regulations. See
Advisory Opinions 2004-07 and 1987-08.
5 In the alternative, you ask if changing the financial
arrangement between Paradigm Shift Productions and KJLL
would permit the activity. Because the Commission has
determined that your proposed activities are exempted from
the electioneering communications restrictions, this
question is moot.