[Federal Register Volume 61, Number 80 (Wednesday, April 24, 1996)]
[Rules and Regulations]
[Pages 18049-18052]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-10038]



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FEDERAL ELECTION COMMISSION

11 CFR Parts 100, 110 and 114

[Notice 1996-11]


Candidate Debates and News Stories

AGENCY: Federal Election Commission.

ACTION: Final rule and transmittal of regulations to Congress.

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SUMMARY: The Federal Election Commission is issuing revised regulations 
governing candidate debates and new stories produced by cable 
television organizations. These regulations implement the provisions of 
the Federal Election Campaign Act (FECA) which exempt news stories from 
the definition of expenditure under certain conditions. The revisions 
indicate that cable television programmers, producers and operators may 
cover or stage candidate debates in the same manner as broadcast and 
print news media. The rules also restate Commission policy that news 
organizations may not stage candidate debates if they are owned or 
controlled by any political party, political committee or candidate.

DATES: Further action, including the publication of a document in the 
Federal Register announcing an effective date, will be taken after 
these regulations have been before Congress for 30 legislative days 
pursuant to 2 U.S.C. 438(d).

FOR FURTHER INFORMATION CONTACT:
Ms. Susan E. Propper, Assistant General Counsel, or Ms. Rosemary C. 
Smith, Senior Attorney, 999 E Street NW., Washington, DC 20463, (202) 
219-3690 or (800) 424-9530.

SUPPLEMENTARY INFORMATION: The Commission is publishing today the final 
text of revisions to its regulations at 11 CFR 100.7(b)(2), 
100.8(b)(2), 110.13 and 114.4(f) regarding news stories and candidate 
debates produced by cable television operators, programmers and 
producers. The revised rules also address candidate debates sponsored 
by news organizations owned or controlled by candidates, political 
parties and political committees. These provisions implement 2 U.S.C. 
431(9) and 441b, provisions of the Federal Election Campaign Act of 
1971, as amended (the Act or FECA), 2 U.S.C. 431 et seq.
    On February 1, 1996, the Commission issued a Notice of Proposed 
Rulemaking (NPRM) in which it sought comments on proposed revisions to 
these regulations. 61 FR 3621 (Feb. 1, 1996). Four written comments 
were received from the Internal Revenue Service (IRS), the Federal 
Communications Commission (FCC), Turner Broadcasting System, Inc. 
(Turner), and the National Cable Television Association, Inc. (NCTA). A 
public hearing on these changes was scheduled for March 20, 1996. The 
hearing was subsequently canceled when the Commission received no 
requests to testify.
    Section 438(d) of Title 2, United States Code, requires that any 
rules or regulations prescribed by the Commission to carry out the 
provisions of Title 2 of the United States Code be transmitted to the 
Speaker of the House of Representatives and the President of the Senate 
30 legislative days before they are finally promulgated. These 
regulations were transmitted to Congress on April 18, 1996.

Explanation and Justification for 11 CFR 100.7(b)(2), Sec. 100.8(b)(2), 
Sec. 110.13, and Sec. 114.4(f)

    The FECA generally prohibits corporations from making contributions 
or expenditures in connection with any election. 2 U.S.C. 441b. 
However, the definition of ``expenditure'' in section 431(9) indicates 
that news stories, commentaries, and editorials distributed through the 
facilities of any broadcast station, newspaper, magazine, or other 
periodical publication are not considered to be expenditures unless the 
facilities are owned or controlled by a political party, political 
committee, or candidate. 2 U.S.C. 431(9)(B)(i). This statutory 
exemption forms the basis for the Commission's long-standing 
regulations at 11 CFR 100.7(b)(2) and 100.8(b)(2) exempting such 
communications from the definitions of contribution and expenditure. 
Section 431(9) is also the basis underlying sections 110.13 and 
114.4(f), which permit broadcasters and bona fide print media to stage 
candidate debates under certain conditions.
    The Commission has decided to expand the types of media entities 
that may stage candidate debates under sections 110.13 and 114.4 to 
include cable television operators, programmers and producers. Hence, 
revised sections 110.13(a)(2) and 114.4(f) allows these types of cable 
organizations to stage debates under the same terms and conditions as 
other media organizations such as broadcasters, and bona fide print 
media organizations. New language in sections 110.13, 100.7(b)(2) and 
100.8(b)(2) also permits cable organizations, acting in their capacity 
as news media, to cover or carry candidate debates staged by other 
groups. Examples of the types of programming that the Federal 
Communications Commission considers to be bona fide newscasts and news 
interview programs are provided in The Law of Political Broadcasting 
and Cablecasting: A Political Primer, 1984 ed., Federal Communications 
Commission, at p. 1994-99.
    The revised rules are consistent with the intent of Congress not 
``to limit or burden in any way the first amendment freedoms of the 
press * * *.'' H.R. Rep. No. 93-1239, 93d Cong., 2d Sess. at 4 (1974). 
In Turner Broadcasting System, Inc. v. Federal Communications 
Commission, ______ U.S. ______, 114 S.

[[Page 18050]]

Ct. 2445, 2456 (1994), the Supreme Court recognized that cable 
operators and cable programmers ``engage in and transmit speech, and 
they are entitled to the protection of the speech and press provisions 
of the First Amendment.''
    The 1974 legislative history of the FECA also indicates that in 
exempting news stories from the definition of ``expenditure,'' Congress 
intended to 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). 
Although the cable television industry was much less developed when 
Congress express this intent, it is reasonable to conclude that cable 
operators, programmers and producers, when operating in their capacity 
as news producers and distributors, would be precisely the type of 
``other media'' appropriately included within this exemption. For these 
reasons, the Commission has decided to allow cable operators, 
programmers and producers to act as debate sponsors.
    The Internal Revenue Service found no conflict with the Internal 
Revenue Code or regulations thereunder. The Federal Communications 
Commission stated that the proposed amendments regarding candidate 
debates and news stories are not inconsistent with the FCC's policies 
in implementing the Communications Act of 1934, and appear to 
complement and further the FCC's regulatory scheme and goals. Two other 
commenters supported the Commission's efforts to confirm that the 
FECA's exemption applies to candidate debates, news, commentary and 
editorial programming produced and distributed by cable news 
organizations. These commenters stated they felt any other course of 
action would present serious Constitutional problems under the First 
Amendment. They also argued that the Commission's interpretation is 
consistent with the statutory framework established by Congress when it 
enacted the 1974 Amendments to the FECA, and would serve the public 
interest.
    The NPRM sought comments on whether there are distinctions between 
cable operators, programmers and producers that should be considered in 
determining which of these types of organizations may stage candidate 
debates, and in determining which of these organizations are bona fide 
news organizations entitled to the press exemption. It also asked if 
there other types of cable new organizations that should be included as 
debate sponsors. One commenter stated that the Commission should 
confirm that the FECA's exemption applies to cable operators and cable 
networks as well as to independent producers of news, commentary and 
editorials they carry. Under the new regulations, the exemption applies 
to each of these entities. The commenter also urged the Commission to 
expand the list of permissible debate sponsors and bona fide news media 
to include regional, state and national trade associations whose 
members are cable operators and programmers. The role of trade 
associations was not addressed in the NPRM and is beyond the scope of 
this rulemaking.
    The revised rules are also consistent with Advisory Opinion 1982-
44, in which the Commission concluded that the press exemption 
permitted Turner Broadcasting System, Inc. to donate free cable cast 
time to the Republican and Democratic National Committees without 
making a prohibited corporate contribution. The cablecast programming 
on ``super satellite'' television station, WTBS in Atlanta, Georgia, 
was to be provided to a network of cable system operators. The 
Commission stated inter alia that ``the distribution of free time to 
both political parties is within the broadcaster's legitimate broadcast 
function and, therefore, within the purview of the press exemption.'' 
AO 1982-44.
    The courts have examined the application of the press exemption in 
section 431(9)(B)(i) on several occasions. See e.g., Readers Digest 
Ass'n v. FEC,  509 F. Supp. 1210 (S.D.N.Y. 1981); FEC v. Phillips 
Publishing Company, Inc., 517 F. Supp. 1308 (D.D.C. 1981); and Federal 
Election Commission v. Multimedia Cablevision, Inc., Civ. Action No. 
94-1520-MLB, slip op. (D. Kan. Aug. 15, 1995). In Readers Digest, the 
court articulated a two part test ``on which the exemption turns: 
whether the press entity is owned by the political party or candidate 
and whether the press entity was acting as a press entity in making the 
distribution complained of. ``Readers Digest, at p. 1215. The first 
prong is discussed more fully below. With regard to the second prong, 
the court stated that ``the statute would seem to exempt only those 
kinds of distribution that fall broadly within the press entity's 
legitimate press function.'' Id. at 1214. The Commission believes a 
cable operator, producer or programmer can satisfy this standard if it 
follows the same guidelines as other news media follow when they stage 
candidate debates. For example, it must invite at least two candidates 
and refrain from promoting or advancing one over the other(s).
    The Commission is also adding language to sections 100.7(b)(2) and 
100.8(b)(2) indicating that the news story exception in 2 U.S.C. 431(9) 
allows cable operators, producers and programmers to exercise 
legitimate press functions by covering or carrying news stories, 
commentaries and editorials in accordance with the same guidelines that 
apply to the print or broadcast media. For example, they are subject to 
the same provisions regarding ownership by candidates and political 
parties as are broadcasters or print media. The public comments 
regarding these changes are summarized above.
    The approach taken in the new rules regarding cable television 
entities avoids conflict with the FCC's application of the equal 
opportunity requirements under the Communications Act of 1934. Section 
315(a) of the Communications Act requires that broadcast station 
licensees, including cable television operators, who permit any legally 
qualified candidate to use a broadcasting station, must afford equal 
opportunities to all other such candidates for that office in the use 
of that broadcasting station. 47 U.S.C. 315(a). However, the equal 
opportunity requirement is not triggered if the broadcasting station 
airs a bona fide newscast, bona fide news interview, bona fide news 
documentary or on-the-spot coverage of bona fide news events (including 
political conventions). 47 U.S.C. 315(a)(1)-(4). In 1975, the FCC 
decided that broadcasts of debates between political candidates would 
be exempt from the equal opportunities requirement as on-the-spot 
coverage of bona fide news events where, inter ailia, the broadcaster 
exercised a reasonable, good faith judgment that it was newsworthy, and 
not for the purpose of giving political advantage to any candidate. See 
The Law of Political Broadcasting and Cablecasting: A Political Primer, 
1984 ed., Federal Communications Commission, at p. 1502. This ruling 
was expanded in 1983 to permit broadcaster-sponsorship of candidate 
debates. Id. Similarly, in 1992, the FCC ruled that independently 
produced bona fide news interview programs qualify for exemption from 
the equal opportunities requirement of the Communications Act. In 
Matter of Request for Declaratory Ruling That Independently Produced 
Bona Fide News Interview Programs Qualify for the Equal Opportunities 
Exemption Provided in Section 315(a)(2) of the Communications Act, FCC 
92-288 (July 15, 1992).
    The third change in the revised rules is the addition of language 
in paragraph (a)(2) of section 110.13 regarding ownership of 
organizations staging candidate debates. Broadcast, cable and

[[Page 18051]]

print media organizations may not stage candidate debates if they are 
owned or controlled by a political party, political committee or 
candidate. This policy was not stated in the previous candidate debate 
rules, although it was included in the 1979 Explanation and 
Justification for those rules. See  44 F.R. 76735 (December 27, 1979). 
It is based on 2 U.S.C. 431(9)(B)(i), which specifies that the news 
story exemption does not apply to media entities that are owned or 
controlled by a political party, political committee or candidate. 
Please note that this new language applies only to media corporations, 
and thus does not change the rules in 11 CFR 110.13 regarding candidate 
debates staged by nonprofit corporations described in section 501(c)(3) 
or (c)(4) of the Internal Revenue Code. None of the commenters 
specifically addressed this change in the regulations.

Certification of No Effect Pursuant to 5 U.S.C. 605(b) [Regulatory 
Flexibility Act]

    The attached final rules will not, if promulgated, have a 
significant economic impact on a substantial number of small entities. 
The basis for this certification is that any small entities affected 
are already required to comply with the requirements of the Act in 
these areas.

List of Subjects

11 CFR Part 100

    Elections.

11 CFR Part 110

    Campaign funds, Political candidates, Political committees and 
parties.

11 CFR Part 114

    Business and industry, Elections, Labor.
    For the reasons set out in the preamble, Subchapter A, Chapter I of 
Title 11 of the Code of Federal Regulations is amended as follows:

PART 100--SCOPE AND DEFINITIONS (2 U.S.C. 431)

    1. The authority citation for Part 100 continues to read as 
follows:

    Authority: 2 U.S.C. 431, 438(a)(8)

    2. Part 100 is amended by revising paragraph (b)(2) of section 
100.7 to read as follows:


Sec. 100.7  Contribution (2 U.S.C. 431(8)).

* * * * *
    (b) * * *
    (2) 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 is not a contribution unless the facility 
is owned or controlled by any political party, political committee, or 
candidate, in which case the costs for a news story (i) which 
represents a bona fide news account communicated in a publication of 
general circulation or on a licensed broadcasting facility, and (ii) 
which is part of a general pattern of campaign-related news accounts 
which give reasonably equal coverage to all opposing candidates in the 
circulation or listening area, is not a contribution.
* * * * *
    3. Part 100 is amended by revising paragraph (b)(2) of section 
100.8 to read as follows:


Sec. 100.8  Expenditure (2 U.S.C. 431(9)).

* * * * *
    (b) * * *
    (2) Any cost incurred in covering or carrying a new story, 
commentary, or editorial by any broadcasting station (including a cable 
television operator, programmer or producer), newspaper, magazine, or 
other periodical publication is not an expenditure unless the facility 
is owned or controlled by any political party, political committee, or 
candidate, in which case the costs for a news story (i) which 
represents a bona fide news account communicated in a publication of 
general circulation or on a licensed broadcasting facility, and (ii) 
which is part of a general pattern of campaign-related news account 
which give reasonably equal coverage to all opposing candidates in the 
circulation or listening area, is not an expenditure.
* * * * *

PART 110--CONTRIBUTION AND EXPENDITURE LIMITATIONS AND PROHIBITIONS

    4. The authority citation for Part 110 continues to read as 
follows:

    Authority: 2 U.S.C. 431(8), 431(9), 432(c)(2), 437d(a)(8), 
438(a)(8), 441a, 441b, 441d, 441e, 441f, 441g and 441h.

    5. Part 110 is amended by revising section 110.13 to read as 
follows:


Sec. 110.13  Candidate debates.

    (a) Staging organizations. (1) Nonprofit organizations described in 
26 U.S.C. 501 (c)(3) or (c)(4) and which do not endorse, support, or 
oppose political candidates or political parties may stage candidate 
debates in accordance with this section and 11 CFR 114.4(f).
    (2) Broadcasters (including a cable television operator, programmer 
or producer), bona fide newspapers, magazines and other periodical 
publications may stage candidate debates in accordance with this 
section and 11 CFR 114.4(f), provided that they are owned or controlled 
by a political party, political committee or candidate. In addition, 
broadcasters (including a cable television operator, programmer or 
producer), bona fide newspapers, magazines and other periodical 
publications, acting as press entities, may also cover or carry 
candidate debates in accordance with 11 CFR 100.7 and 100.8.
    (b) Debate structure. The structure of debates staged in accordance 
with this section and 11 CFR 114.4(f) is left to the discretion of the 
staging organizations(s), provided that:
    (1) Such debates include at least two candidates; and
    (2) The staging organization(s) does not structure the debates to 
promote or advance one candidate over another.
    (c) Criteria for candidate selection. For all debates, staging 
organization(s) must use pre-established objective criteria to 
determine which candidates may participate in a debate. For general 
election debates, staging organizations(s) shall not use nomination by 
a particular political party as the sole objective criterion to 
determine whether to include a candidate in a debate. For debates held 
prior to a primary election, caucus or convention, staging 
organizations may restrict candidate participation to candidates 
seeking the nomination of one party, and need not stage a debate for 
candidates seeking the nomination of any other political party or 
independent candidates.

PART 114--CORPORATE AND LABOR ORGANIZATION ACTIVITY

    6. The authority citation for Part 114 continues to read as 
follows:

    Authority: 2 U.S.C. 431(8)(B), 431(9)(B), 432, 437d(a)(8), 
438(a)(8), and 441b.

    7. Part 114 is amended by revising paragraph (f) of section 114.4. 
to read as follows:

Sec. 114.4  Disbursements for communications beyond the restricted 
class in connection with a Federal election.

* * * * *
    (f) Candidate debates.
    (1) A nonprofit organization described in 11 CFR 110.13(a)(1) may 
use its own funds and may accept funds donated by corporations or labor 
organizations under paragraph (f)(3) of this section to defray costs 
incurred in staging candidate debates held in accordance with 11 CFR 
110.13.
    (2) A broadcaster (including a cable television operator, 
programmer or producer), bona fide newspaper,

[[Page 18052]]

magazine or other periodical publication may use its own funds to 
defray costs incurred in staging public candidate debates held in 
accordance with 11 CFR 110.13.
    (3) A corporation or labor organization may donate funds to 
nonprofit organizations qualified under 11 CFR 110.13(a)(1) to stage 
candidate debates held in accordance with 11 CFR 110.13 and 114.4(f).
* * * * *
    Dated: April 18, 1996.
Lee Ann Elliott,
Chairman.
[FR Doc. 96-10038 Filed 4-23-96; 8:45 am]
BILLING CODE 6715-01-M