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FCC Ends COVID-Era Lowest Unit Charge Exemption for Free Advertisements


During the COVID-19 pandemic, a number of advertisers were facing a dire economic situation. Many stations were offering their clients free advertising. At the time, the FCC ruled that such free advertising would not be counted when calculating a station’s lowest unit rate. This policy helped stimulate economic activity during the pandemic. The FCC found that stations:

"[W]ould be permitted to exclude free time that they provide to commercial advertisers when calculating lowest unit charge (LUC), provided the free time is not associated with an existing commercial contract for paid time or otherwise considered bonus spots."

Now that the pandemic is over, free time given to commercial candidates will affect your Lowest Unit Charge calculations as of May 15, 2023. The FCC stated:

"After more than three years, the unprecedented circumstances that necessitated the 2020 Public Notice are no longer present. Therefore, effective immediately, the temporary relief provided in the 2020 Public Notice is rescinded. Going forward, broadcasters and other regulatees that are subject to section 315(b) of the Act should include free time that they provide to commercial advertisers when calculating their LUC."

You can see the FCC’s public notice ending the COVID-era policy here.

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