Rep. Issa: Is NAB Breaking FEC Rules?
House Oversight and Government Reform ranking member Darrell Issa, a cosponsor of legislation that would end a long-standing royalty exemption granted to AM and FM radio, believes the National Association of Broadcasters is engaging in "overt intimidation" and has forced talk radio hosts around the country to attack the bill and urge listeners to call specific members of Congress. Issa said in an interview last week that he has been barraged by angry phone calls from listeners and said other bill supporters have had a similar experience. The NAB opposes the proposal that many believe would bring over-the-air radio in line with Internet, cable and satellite music services that pay performers for use of their work. Broadcasters argue the promotional value of airplay and album and concert sales make up for the disparity.
"This is really 527 activity and it is a violation of FEC rules," Issa said of the NAB's alleged efforts. "I suspect if they continue, one or more members will complain the NAB is using airwaves to affect the outcome of an election." NAB spokesman Dennis Wharton offered a different take on what is going on. "Broadcasters have a responsibility to 235 million weekly listeners of free, local radio to encourage a national dialogue on the devastating impact of a performance tax," he said. The legislation in question would endanger local radio's already unsteady financial position by diverting hundreds of millions of dollars into coffers of record labels, he argued. "Citizens have a right to know that a performance tax imperils the future of free, local radio."
In the interview, Issa acknowledged the legislation -- championed by House Judiciary Chairman John Conyers and Senate Judiciary Chairman Patrick Leahy -- will not move forward easily unless concessions are made. He believes broader changes to the copyright system are needed to allow the market to work properly. "Congress doesn't have clean hands, broadcasters aren't acting in good faith and there's a general belief that the Copyright Royalty Board isn't fair," he said of the federal panel that sets royalty rates. Updating the century-old compulsory copyright licensing regime or modifying the ban on paid radio promotion could be potential vehicles for compromise on the radio bill, he said. Another option could be setting a performance fee that is "livable for now," Issa said, pointing to other countries that have set as little as a half-percent royalty.
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