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Five Underwriting Controversies

Last Updated on January 15, 2025 by Content Director

Updated Guidelines for Underwriting on Noncommercial Educational (NCE) Radio Stations

At the 1999 National Public Radio Conference in Washington, D.C., Kenneth M. Scheibel Jr., Senior Attorney Advisor in the FCC’s Mass Media Bureau Enforcement Division, addressed common questions related to underwriting practices for public radio. Below is an updated summary of his answers, which are still relevant under current FCC regulations:

1. Can a Station Include the Name of a Sponsor and the Sponsor’s Product/Service?

A key question is whether it’s appropriate to include both the name of the program’s sponsor and their product or service.

  • Acceptable: If an underwriter wants to be mentioned for their contribution, you can say something like, “This program is brought to you by Acme Theater,” as this is purely an acknowledgment of support.
  • Unacceptable: If the announcement includes specific product offerings like “Acme Western Wear, offering Wrangler, Lee, and Dakota jeans,” this becomes a promotional statement, which is prohibited. In contrast, naming a third-party sponsor that didn’t contribute directly to the broadcast (e.g., “Production underwritten by Star Computing” when they aren’t an official sponsor of the broadcast) is also not allowed. Only entities that directly support the station should be acknowledged.

2. Can a Station Legally Turn Away an Underwriter?

Yes, stations have the discretion to accept or decline underwriting support.

  • Under Section 3(10) of the Communications Act, broadcasters are not considered common carriers and do not have to provide universal access to all potential underwriters.
  • The decision to accept or reject underwriting is up to the broadcaster’s discretion, based on its policies, goals, and programming guidelines.

3. What Language Must Be Included in Underwriting Acknowledgements?

FCC regulations require that nonprofit stations fully disclose who has provided support for programming. This is to ensure transparency and proper identification of contributors.

  • Section 73.1212 of the Communications Act states that stations must indicate the sponsor’s identity when the program is aired.
  • Stations must “exercise full diligence” to fairly disclose the true identity of the entity providing support.
  • The Commission interprets this to mean that stations may rely on assurances from sponsors, provided the information is credible, but must act if credible evidence to the contrary arises.

4. Are There Different Rules for Nonprofits vs. For-Profits?

Yes, there are distinctions in how nonprofit and for-profit sponsors should be handled:

  • For-Profit Sponsors: Acknowledgment can only identify the organization’s name but cannot promote its products or services. Promotional language such as specific products, pricing, or calls to action is prohibited.
  • Nonprofit Sponsors: Nonprofits have more flexibility and can be acknowledged in ways that promote their activities or those of other nonprofit organizations. There are fewer restrictions on how nonprofit supporters can be mentioned, as long as they comply with general FCC guidelines.

5. Can Financial Institutions List Prices or Interest Rates in Underwriting Announcements?

No, financial institutions cannot include price information, such as interest rates, loan terms, or specific discounts, in underwriting announcements.

  • Underwriting cannot refer to price information, including credit card or mortgage loan interest rates, available discounts, or services offered at cost or for free.
  • Financial institutions should limit their acknowledgement to identifying their support for the program without providing promotional or price-related content.

Key Takeaways

  1. Noncommercial stations cannot air commercials, and must ensure that underwriting language does not promote products or services, give price details, or include calls to action.
  2. Acknowledging sponsors is acceptable, but it must only identify them without promoting specific offerings or making comparative statements.
  3. Nonprofit supporters can be acknowledged in ways that promote their missions, while for-profit sponsors must only be identified.
  4. Financial institutions should avoid including any price, interest rate, or discount details in their underwriting announcements.

For more detailed guidance on underwriting compliance, consult the FCC’s Noncommercial Nature of EducationalBroadcasting page.

Disclaimer: This document is for informational purposes only and does not provide legal advice. Consult a qualified broadcast attorney for specific guidance.