Underwriting Compliance Guide: 4. Other Prohibited Acts

4.      Other prohibited acts

            a.         Requests from political campaigns

Section 399b of the Communications Act considers any message to support or oppose any candidate for political office as an advertisement.  Therefore, noncommercial stations may not carry paid messages from candidates or in respect to ballot initiatives or referenda.  These requests should be declined and the details of the request must be placed in your station’s political file and retained for at least 2 years.  Section 399 of the Communications Act prohibits noncommercial stations from endorsing for or against any candidate for public office (regardless of whether they receive consideration or not).  This also violates other federal and state laws.

            b.         Payola and plugola

Payola and Plugola goes back to the 1950s when record companies would pay disc jockeys or other station staff directly for the play of certain records. “Payment” was not always in cash but in other tangible items or non-tangible “services”. In these cases, it was never disclosed on the air that the record company was actually paying the radio station or a staff member in connection with the play of that recording.

Section 317(a)(1) of the Communications Act requires that:

All matter broadcast by any radio station for which any money, service or other valuable consideration is directly or indirectly paid, or promised to or charged or accepted by, the station so broadcasting, from any person, shall, at the time the same is so broadcast, be announced as paid for or furnished, as the case may be, by such person: Provided, That “service or other valuable consideration” shall not include any service or property furnished without charge or at a nominal charge for use on, or in connection with, a broadcast unless it is so furnished in consideration for an identification in a broadcast of any person, product, service, trademark, or brand name beyond an identification which is reasonably related to the use of such service or property on the broadcast.

In other words, if a station or a staff member receives any consideration as described above in connection with the playing of a record or for advertising an upcoming gig (plugola), then the sponsorship must be disclosed.

This is why it is important that all incoming consideration to a station goes through the proper channels so the station’s entire compliance plan can be properly applied.

            c.         Certain types of businesses with restrictions on messages

Stations should be aware of any state or federal laws outside of the FCC as well as any accepted guidelines within trade industries that may apply to acknowledgements involving certain businesses and products that may be otherwise controlled by such laws and regulations.  This may include alcoholic beverages, smoking, gambling, adult oriented businesses, medical products.  These laws and regulations may not necessarily differentiate between commercial advertisements and “acknowledgements” by noncommercial entities. 

One of the recent issues is the controversy around medical and recreational marijuana due to the federal categorization of THC, regardless of the legal status of such products in specific states.  There may also be controversies around CBD products, despite recent legislation that modified the product’s legal status.  There are also controversies around the use of “vape” or e-cigarettes and the advertising of these products.

Because of the ongoing changes in laws and the “uncharted territory” where it comes in connection to these products, REC is not prepared at this time to provide any advice on underwriting announcements for dispensaries, pharmacies, smoking supply shops, head shops, cultivators, growers or distributors of THC and/or CBD products.  Stations should consult with an attorney in respect to these lines of business prior to carrying underwriting announcements.

            d.         Smoke shops

Due to federal laws under the jurisdiction of the Federal Trade Commission (as opposed to the FCC), radio and television stations cannot accept underwriting for:

  • Cigarettes
  • Little cigars (any roll of tobacco wrapped in leaf tobacco or any substance containing tobacco other than a cigarette).
  • Smokeless tobacco
  • "Roll your own" tobacco and papers

You cannot have an underwriter with the word "cigarette" in their name, even if the underwriting copy does not otherwise mention a prohibited product.

Vaping or E-cigarette products are OK, however the industry is voluntarily not carrying such advertisements in the commercial sector. 

There are no restrictions on "big" cigars, pipes, pipe tobacco or paraphernalia assocated with pipe smoking.

            e.         Emergency Alert System elements

We understand this is not just an issue with underwriting practices but also with station programming.

The FCC takes the Emergency Alert System (EAS) very seriously.  EAS elements such as the dual-frequency attention signal and the frequency shift keying sounds should NEVER be used for any reason other than an authorized test, an authorized public service announcement (one that has already been pre-produced and approved) or an actual emergency activation, pursuant to §11.45(a) of the FCC Rules.  The FCC has determined that if EAS elements are used for trivial purposes, including for dramatic purposes and even the playing of previous airchecks of alerts, including from your own station can result in "alert fatigue" and can result in listeners not taking EAS seriously when there is a real emergency.  The FCC has been fining broadcasters, including cable networks in the 5-figures plus for EAS violations.  It is important to also remember that stations are responsible for everything that goes over their air so even if the program was not produced by the station (such as programming submitted to the station or syndicated programming), the station is still liable.  

Pursuant to §11.45(b), in the event that a station has transmitted or otherwise sent a false alert to the public, the station must send an email to the FCC Operations Center at fccops@fcc.gov, informing the FCC of the event and of any details that the station may have concerning the event.  This will not get you off the hook, but it is the right thing to do (and the FCC could elevate the fine if the reporting is not done).

           f.         Sponsorship of station elements such as the studio

In 1982, in response to legislation passed in Congress that resulted in our modern day underwriting guidelines in Sections 399a and 399b of the Communications Act, the FCC, while interpeting the statutory language "announcements may not interrupt regular programming", they determined that undewriting acknowledgements must be made "at the beginning and end of programs", "between identifable segments of a longer program" (such as during the intermission of an opera) or in the absence of identifiable segments in programming, in programming during "station breaks", such that the flow of programming is not "unduly disrupted". This FCC interpretation was based on a House Report that was used in the construction of the legilsation. 

With that said, any mention of an underwriter must be done during a break in programming.  You cannot "embed" a sponsor into casual conversation, including "naming rights" for the studio or other program elements.  For example, a potentially prohibited example can include:

" [music] That was Pink Floyd, with Another Brick In The Wall Part 2.  It's 3:52, and I'm Clyde Ankle here in the WVWA Joe's Crab Shack Studio here in Riverton and the music continues with Peter Gabriel... [music]"

The more appropriate approach would be:

"[music] That was Pink Floyd, Another Brick in the Wall Part 2.  I'm Clyde Ankle, we'll be back in just a bit. [pause] WVWA's studio is sponsored by Joe's Crab Shack at 101 Main Street in Riverton. [pause] The music continues here in WVWA, with Peter Gabriel... [music]

For full-service NCE stations, any sponsorship of a program must include an entry in the station's donor list that appears in the station's public inspection file.  LPFM does not have a public file requirement.