Friday, June 13, 2008

Regulatory Compliance in the Age of Transparency

In years past, the FCC’s Field Offices were the logical and most common source of regulatory compliance checks for broadcasters. A field office representative would show up one day unannounced at the station studio, and ask to see the EAS log or public file, for example. Except in situations where listening to or measuring the station’s signal could reveal regulatory non-compliance, stations knew when they had been inspected and could reasonably expect what enforcement action followed.

Today, in the “Age of Transparency” brought on by the internet, it is possible and becoming more common for the FCC to monitor compliance from Washington. Don’t get me wrong. I’m not suggesting that the FCC has dedicated personnel in Washington to snoop on station websites and play “gotcha.” But in the past few years, I have encountered several situations where the FCC staff has deliberately checked a station website to see if a station has posted a required report or other information. Stations know they have to comply with the rules that govern them, and most do, but it is at least somewhat discomfiting to know that the agency that licenses you can so easily check up on you without your even knowing.

I’ll give a few examples. During a renewal application process last year, I encountered a savvy staffer who noted that a children’s television report had not been filed or posted on a station’s website. Here is what caught my attention – the renewal application, like most other current forms at the FCC, is a “certification” form where broadcasters certify their compliance. The whole purpose of “certification” forms was to remove the time-consuming staff obligation to sift through numerous questions and potentially pages of documents that used to be filed as exhibits. And yet, here was a staffer cross-checking a certification with what she could view in the FCC’s database and on the station’s website. Ultimately, that cross check led to a monetary forfeiture.

Most recently, an FCC staff member contacted me informally to advise that while checking to ensure that TV stations had filed the new DTV education form (unusual in and of itself), he could not find a station’s filed report. He had then visited the station’s website, and upon seeing the report on the website, erroneously concluded that the report had been completed, but not electronically filed with the FCC. In that case, the report had actually been e-filed, but just styled differently. A clarification avoided any enforcement action.

The list of reports that must be posted on station websites is growing. In the world of equal employment opportunity, certain EEO reports must be posted on a station’s website if it has one. For TV broadcasters, the Form 398 Children’s Television Report must be website-posted and electronically filed quarterly. TV stations also have to post forms related to their DTV education efforts. Recent “localism” efforts have brought us very near to most of the public file for television stations having to be posted on the website, and radio stations may not be far behind. If that occurs, not only when and whether items are posted, but also the specific content of those postings, will be much more open to scrutiny.

What’s the lesson here? When it comes to your station’s website, and the recent and growing list of rules that require you to post documents there for public viewing, it is even more important that you accurately complete and timely post required documents, and then remove them when they are no longer required to be posted.

I don’t subscribe to the notion that the answer to the growing trend of “website posting” rules should drive broadcasters to shut down websites. Your website is a unique and popular way to connect with your viewers and listeners, and deliver content and value to them. Instead, spend a few minutes checking that rule and getting your report or posting right.

One final thought. Remember those members of the public who never visited your station to view the public file? Rest assured, when public file website posting requirements become a reality, they’ll be checking it online, and if they see an anomaly, the email complaint to the FCC will follow.

All text © 2008, Hardy, Carey, Chautin & Balkin, LLP. All Rights Reserved.