LPFM and Sponsorship Regulations

Managers must know the difference between commercials and underwriting.
Publish date:
Social count:
Managers must know the difference between commercials and underwriting.

Managers must know the difference between commercials and underwriting.

As noncommercial licensees, low-power FM radio stations are allowed to broadcast sponsorship or "underwriting" announcements, but not commercials.

The difference is not always clear to professional broadcasters, let alone to a person new to radio. Many low-power stations are managed by citizens who have other full-time jobs and responsibilities and who have little or no previous background in broadcasting. Licensed to civic groups, churches and schools, these stations often are operated by volunteers as a form of community service.

Understanding FCC regulations, particularly in the area of program sponsorships, can be a challenge.

We discussed these questions with communications attorney Cary S. Tepper in Washington for his input.


Basically, a sponsorship announcement cannot include a call to action. It can identify a sponsor but cannot describe the sponsor's business in a comparative or qualitative way.

Tepper said length can also become an issue.

"Some announcements are simply too long. Even though your content may not be a sales pitch, the FCC has taken the position that the longer it takes to identify the sponsor and its services, the more it becomes promotional," he said.

"I have clients who run 45-60 seconds in an announcement, and even though nothing is said that is inappropriate, there's just too much of it. Keep your announcements as short as possible."

Tepper said sometimes more detail can be included depending on the nature of the announcement.

"If more information is needed for an event - let's say a county fair is going to be a sponsor of one of your programs and you need to give lengthy directions how to get there, or there is a special charity event that you need to give a little extra information (for) - that's fine. But if it's a regular merchant, you can pretty much say what you need to say in 20-25 seconds at most."

Tepper would refrain from putting in testimonials or any information that has nothing to do with the sponsor.

Some operators may be unaware that there are times when a station is allowed to promote an event directly with announcements that sound just like commercials.

One example, Tepper said, is a remote broadcast from a local establishment, such as a restaurant or a bar, that serves as a station fundraiser.

"The FCC has taken the position that if you're getting an extra financial benefit - the door, for instance - and nobody else is, they'll let you promote the event. I would promote the event but I would not promote the kinds of things where the bar or restaurant can make money. Don't promote their food and don't promote their drink specials or anything like that."

With the sponsor

One obstacle noncommercial stations face is explaining the differences between an underwriting announcement and a regular commercial to a potential sponsor.

Tepper's advice is to tell them you are a non-commercial radio station and that you are not allowed to broadcast regular commercials.

"You can, however, identify their services and provide address and phone numbers. But it has to be brief and to the point. You shouldn't go out there and 'sell' 30-second spots. Tell your clients to gather some information and you will put together an appropriate spot."

Those spots do not have to be so plain as to include only a voice reading the information.

"You can add production to these spots - sound effects and such," said Tepper. "The only thing you shouldn't do is go into your music library and use copyrighted material in your announcements. You can go out and buy production libraries. But just because you're paying an ASCAP or BMI fee doesn't give you the right to use that music for production."

Tepper said stations also are allowed to recoup whatever production expenses were necessary for a broadcast. Creative operators can find additional ways to bring in revenue.

"Just because you're a non-profit and a noncommercial radio station doesn't mean you can't make money off your non-broadcast activities," Tepper said. "People can pay you for your tower space, people can pay you for production. If you want to do production for other people, you certainly can do that and make money off of it."

A noncommercial station is permitted to promote a sponsor that is a non-profit entity. One example might be a blood drive at the local American Red Cross.

Tepper cautioned that it's important to make sure the local ARC is a non-profit, tax-exempt organization. "A lot of those organizations aren't, surprisingly. So you really need to find out."

Non-profits can include student organizations - if they are truly non-profit; most that use a university account will qualify.

"You have to be the judge of what their status is and make a good-faith determination on that. Make sure they are tax-exempt, truly organized as a non-profit entity."

Keep a file

Although LPFMs are not required to keep an Issues-Programs list in their public file as full-power stations are, Tepper thinks it's a good idea.

"You don't have to do it, but it certainly can't hurt you to do it. It would just bolster your position should somebody ever challenge you about whether or not you were programming in the public interest sufficiently."

Such a list must be updated quarterly and include between 10 and 15 hours of public interest programming responsive to the specific needs of your community.

"Some of that can be national, but some of it certainly should be local. A lot of stations try to fulfill that obligation with a lot of PSAs and that doesn't cut it. PSAs count for a little bit, but you really need to have some longer-term programming - 15 minutes or more in length."

Because many LPFMs are licensed to schools and colleges, some operators wonder about the requirements for minimum hours of operation. According to Tepper, the FCC has recognized that colleges and universities that do not have a full schedule during the summer months or even winter break are not under the normal operating requirements.

It is wise, though, to stay on the air if you possibly can.

"The thing you run the risk of is if your station is not on the air all year long, somebody could come in at license renewal time and request a time-share, claiming that you're not fulfilling 100 percent of your public obligation. That's the risk that you theoretically take."

Although LPFM stations have fewer regulations than full-power stations, Tepper emphasized that it is crucial for operators to take the regulations that do exist seriously. That means remaining vigilant about programming, including the content of sponsorship announcements.

"Some think that nobody's watching them and chances are nobody is. But you would hate to be that one station where somebody was listening at that moment and makes an issue of it."

Note that not all of the opinions reported here are shared by all legal experts. As always, it's best to consult your communications counsel before making decisions on specific matters.

Write to Radio World at radioworld@imaspub.com