Advisory Opinion 2006-10: LLC's PSAs permissible under FECA

Public service announcements created and broadcast by EchoStar Satellite LLC ("EchoStar") that feature federal candidates are not coordinated communications because they would qualify for the charitable solicitation exemption provided that both the solicitations and the organizations for which the funds are solicited comply with the requirements of 11 CFR 300.65.

Background

EchoStar, a limited liability company treated as a corporation for tax and FECA purposes, provides satellite TV service under the brand name "DISH Network." See 11 CFR 110.1(g). EchoStar plans to air public service announcements ("PSAs") nationwide featuring prominent Americans, including incumbent Members of Congress, promoting and soliciting donations to charitable organizations.

EchoStar will write the script for the PSAs, which will not include campaign materials or expressly advocate the election or defeat of a federal candidate. The PSAs will not mention a political party, campaign, or election, nor will the PSAs solicit contributions for any political campaign or committee. Furthermore, EchoStar will avoid making electioneering communications by airing the PSAs outside of the candidate's jurisdiction or prior to the applicable electioneering communication time period.

Analysis

The Act and Regulations define "contribution" and "expenditure" to include any gift of money or "anything of value" for the purpose of influencing a federal election. 2 U.S.C. 431(8)(A) and (9)(A); 11 CFR 100.52(a) and 100.111(a). An in-kind contribution includes an expenditure made by a person in cooperation with or at the request or suggestion of a candidate or the candidate's committees or agents. 2 U.S.C. 441a(a)(7)(B)(i). A coordinated communication is considered an in-kind contribution by the person paying for the communication unless the communication falls within an exception from the definition of contribution. 2 U.S.C. 441a(a)(7)(B)(i); 11 CFR 109.21(b). The Act and Commission regulations prohibit a corporation from making any contribution or expenditure in connection with a federal election. 2 U.S.C. 441b(a); 11 CFR 114.1(a); 11 CFR 114.2(b)(1) and (b)(2). Thus a corporation is prohibited from paying for a coordinated communication. See 11 CFR 109.22.

A communication may be considered coordinated if it fulfills a three-prong test. First, the communication must be paid for, in whole or in part, by a person other than the federal candidate or the candidate's committee. Second, the communication must fulfill at least one of six conduct standards set forth in 11 CFR 109.21(d). Third, the communication must meet at least one of the four content standards in 109.21(c). See 71 FR 33190 (June 8, 2006) (publishing revised Commission regulations regarding coordinated communications). The definition of coordinated communications contains exemptions, including one for certain endorsements and solicitations by federal candidates. See 11 CFR 109.21(f) – (h).

The regulations exempt from the definition of "coordinated communications" public communications in which the federal candidate solicits funds for a 501(c) non-profit organization as long as the organization (1) does not engage in activities in connection with an election or (2) the organization's principal purpose is not to conduct election activity, and the solicitation is not to raise funds for activities in connection with an election. 11 CFR 109.21(g) and 300.65. To qualify for this exemption, the public communications may not promote, support, attack, or oppose the soliciting candidate or the candidate's opponent. 11 CFR 109.21(g).

EchoStar's PSAs are satellite communications and thus are within the definition of a public communication. 11 CFR 100.26. The federal candidates will appear in the PSAs to solicit funds for charitable organizations and will not promote, support, attack, or oppose their candidacies or those of their opponents. See AO 2003-25. As a result, the PSAs will qualify for the solicitation exemption as long as the organizations qualify as 26 U.S.C. 501(c) organizations and the solicitations comply with 11 CFR 300.65. See 11 CFR 109.21(g).

Additionally, if the PSAs are distributed more than 90 days before a Congressional candidate's election or 120 days before a presidential candidate's election, or outside the featured candidate's jurisdiction, the PSAs would not fulfill the content prong of the coordination test regardless of their subject matter. See 11 CFR 109.2(c)(4); 71 FR 33190 (June 8, 2006). However, if the communications were distributed during the applicable time period within the candidate's jurisdiction and did not solicit funds for a 501(c) organization, the PSAs would be considered coordinated communications.

Since the proposed PSAs qualified for the charitable solicitation exemption, the Commission did not consider the application of the press exemption.

AO 2006-10; Date issued: June 30, 2006; length: 7 pages