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B'casters: Free-airtime bill is a consumer tax - Broadcasting & Cable

B'casters: Free-airtime bill is a consumer tax

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Broadcasters reacted strongly Wednesday against a new bill that would
charge radio and television broadcasters spectrum-use fees and use those fees to
help fund political-campaign advertising.

The bill -- which is to be introduced by Sens. John McCain (R-Ariz.), Russell
Feingold (D-Wis.) and Robert Torricelli (D-N.J.) and Rep. Marty Meehan (D-Mass.)
-- would require radio and TV broadcasters to pay approximately 1 percent of
their gross revenues, or approximately $640 million, into a fund that would be
dispersed to the political parties. The parties would then dole out radio- and TV-advertising time, in the form of vouchers, to qualified candidates. To qualify,
candidates first would have to raise a certain amount of money from individual
donors.

Broadcasters called the idea a tax that would be passed on to consumers.

"McCain is proposing a tax to put more political advertisements on the air
than already exist," said Stan Statham, president and CEO of the California
Broadcasters Association. "There's no such thing as a tax that citizens don't
pay. If he wants to tax broadcasters $640 million, that means the price of
advertising increases, so the cost of goods increases."

Broadcasters also took exception to a study by the Committee for the Study of
the American Electorate, which stated that TV stations failed to air
political debates.

"Your organization grossly undercounted the number of debates actually
carried by local television stations, and especially those carried by local
network affiliates," wrote Dennis Wharton, senior vice president of corporate
communications for the National Association of Broadcasters. "In fact, your
report undercounts the actual number of debates carried by local TV stations in
seven of 10 states that you surveyed."

The CSAE's report, released last month, said that of 152 political debates held
in 10 states, 63 percent were not televised and only 18 percent were
televised by network affiliates.

The Alliance for Better Campaigns, which supports McCain's and Feingold's new
bill, used the CSAE study to illustrate why Congress should mandate political
coverage.

McCain's and Feingold's bill would require broadcasters to dedicate two hours
of airtime each week to political discourse in the six weeks leading up to
primary and general elections.

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