Congress Said Moving to Grant Relief to Sinclair, Broadcasters

  • Rule restricting ability to control more than station at stake
  • Lawmakers of both parties said to back language in budget bill

Congress may give broadcasters including Sinclair Broadcast Group Inc. and Nexstar Broadcasting Group Inc. relief from pending restrictions on their ability to control more than one television station in a city.

Lawmakers from both parties are backing language to leave in place joint arrangements formed before the U.S. Federal Communications Commission last year tightened rules, said a person close to negotiations who spoke on the condition of anonymity. The language would be attached to a federal spending bill Congress is trying to pass before funding runs out Dec. 16. The FCC said companies need to comply next year with its tighter limits on two-station combinations, or duopolies.

The rules are designed to ensure that news within communities isn’t dominated by one voice.

The agency moved to limit TV-station owners who control the advertising of nearby stations owned by a third party, and reap the sales revenue. The deals position the larger station as de facto owner of the smaller station, whose independence is a “legal fiction,” said FCC Chairman Tom Wheeler.

Shared-Ad Sales

Republicans and companies said the arrangements facing new restrictions help fund local programming, including news at struggling television stations in mid-size and smaller markets.

The FCC approved 85 shared-ad sales arrangements in merger reviews from 2008 up to its rules change, according to the National Association of Broadcasters, a trade group.

Companies have been urging Congress to act.

“We have had decent success on the regulatory front,” Sinclair Chief Financial Officer Chris Ripley told investors Nov. 4. The language “has a good chance of getting through.”

Sinclair, based in Hunt Valley, Maryland, owns or has relationships with 164 TV stations in 79 markets, according to its website.

“There is a very good chance that there will be a roll-back” to allow arrangements that existed before the FCC acted, Nexstar Chairman Perry Sook said in an earnings call Nov. 3. Nexstar, based in Irving, Texas, owns or has relationships with 106 television stations reaching 57 markets, according to its website.

Schumer, Mikulski

Senate leaders including Democrats Barbara Mikulski, of Maryland, and Charles Schumer, of New York, and Missouri Republican Roy Blunt support the language and odds of its being included in a final spending bill are high, according to Brad Barker, a Bloomberg Intelligence analyst.

Nexstar spokesman Joseph Jaffoni and FCC spokesman Neil Grace declined to comment. Barry Faber, a Sinclair spokesman, didn’t reply to telephone messages. Mikulski on Dec. 3 declined to comment. Her office and Schumer’s office didn’t return a telephone call Monday.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE