Television broadcasters joined FCC Commissioner Ajit Pai in applauding the passage of legislation by the Senate Commerce Committee that grandfathers broadcaster joint sales agreements (JSAs) signed prior to the FCC’s decision last year to classify as an attributable ownership interest any JSA that involves the sale of 15% or more of a TV station’s advertising time to a competing local station. Broadcasters with JSAs in existence at the time of the FCC’s March 2014 ruling were given two years to unwind their agreements. Introduced in May by Senator Roy Blunt (R-MO) with the backing of co-sponsors Barbara Mikulski (D-MD), Chuck Schumer (D-NY) and Tim Scott (R-SC), the measure (S-1182) would exempt from the FCC’s attribution rules any JSA in existence at the time of the March 2014 order. Last Thursday’s 14-10 committee vote also follows in the wake of the previous week’s vote by the House Appropriations Committee to deny FCC funding for implementation of the JSA policy.
Faulting the FCC for its decision to apply the attribution rules retroactively to existing JSAs, Blunt proclaimed that his bill is intended to uphold legitimate business decisions made by broadcasters who executed JSAs in good faith and in compliance with previous FCC rules. During a mark-up session, however, several committee Democrats, including ranking committee member Bill Nelson (D-FL) and Senators Richard Blumenthal (D-CT) and Corey Booker (D-NJ), registered concerns with the bill. As Blumenthal cautioned that exempt JSAs would be allowed to continue “in perpetuity” unless a termination date was written into the bill, Booker defended the FCC policy change as one that promotes diversity in media ownership, charging that JSAs “are clearly being abused” to allow large broadcasters in some cases to sell 100% of the ad time for smaller stations.
Notwithstanding these sentiments, Commissioner Pai—who voted against the JSA rule change—welcomed the committee action, asserting that “members of both parties in both chambers of Congress recognize that JSAs are pro-competitive agreements that allow broadcasters to cut costs by using the same advertising sales force.” As he applauded the bill, which he said “allows local broadcasters . . . to continue operating [JSAs] that enhance local news, weather and community interest programming,” National Association of Broadcasters Executive Vice President Dennis Wharton said, “we look forward to working with . . . lawmakers toward successful passage.”