Nancy Pelosi is creating static over a deal to take a large group of TV stations personal — after she and fellow Home Democrats received greater than $500,000 in marketing campaign donations from Byron Allen, a comedian-turned-media mogul who needs to dam the deal.
The Home Speaker despatched an Oct. 6 letter to FCC Chairwoman Jessica Rosenworcel expressing “critical considerations” about an settlement by Tegna — a publicly traded chain of 64 native TV stations that was spun off from newspaper large Gannett in 2015 — to promote itself to the hedge fund Commonplace Normal for $8.6 billion.
In the meantime, Federal Election Fee filings present that within the fourth quarter of final 12 months Pelosi received $271,300 in marketing campaign donations from Allen, who owns a gaggle of cable-TV networks together with The Climate Channel and is angling to nab Tegna’s nationwide broadcasting empire to widen their distribution.
Throughout the identical quarter, Allen — who earlier this month made headlines for shopping for a $100 million property in Malibu, Calif. — additionally donated $275,000 to the Democratic Congressional Marketing campaign Committee, which backs Democratic candidates for the Home, FEC filings present.
“If she helps out a significant donor it doesn’t look good, fairly frankly,” stated Craig Holman, the Capitol Hill lobbyist for advocacy group Public Citizen who says he has labored on ethics points with Pelosi for 20 years. “In terms of marketing campaign finance, that is typically the way it works. A donor provides cash with the expectation of some return.”
Pelosi’s Oct. 6 letter got here regardless of the very fact there aren’t any Tegna TV stations in her San Francisco congressional district. The donation from Allen was his solely on document to Pelosi. Allen reduce the checks late final 12 months as his personal bid to purchase Tegna started to unravel over financing issues, in line with sources near the state of affairs. Tegna agreed to promote itself to Commonplace Normal in February.
“It's authorized except there may be an precise settlement between the events. Then it's a bribe,” Holman informed The Publish. “However when there isn't any apparent settlement, it doesn't run afoul of the regulation.”
Within the letter, Pelosi, together with Power and Commerce Committee Chair Frank Pallone Jr., stated she was anxious the deal would increase cable payments, crimp native information protection and spur job losses. In a written response to the FCC, Commonplace Normal denied plans to decrease native protection and reduce station jobs, calling them hypothesis and saying it “made a dedication within the FCC document that it was not planning any such actions.”
In the meantime, a supply near Allen’s firm, Allen Media Group, stated, “Byron was going to chop 30% of bills if he purchased Tegna and that meant job losses.”
“Not true,” countered Allen, when reached by The Publish on Wednesday. “I've near 2,300 workers and throughout the pandemic I didn't lay off one employee.”
A spokesman for Pelosi, Henry Connelly, declined to touch upon Allen’s donations. He stated Pelosi and Pallone wrote to the FCC with comparable considerations in 2017 about Sinclair Broadcasting’s proposal to purchase stations from Tribune Broadcasting. That deal, which was scrapped a 12 months later, had been controversial over Sinclair’s ties with Donald Trump.
“Evidently, there are some ‘authorized specialists’ who shall be shocked to be taught that the Speaker of the Home of Representatives does actually routinely weigh in on problems with nationwide significance, not simply her personal district,” Connelly stated in a press release. “Democrats have lengthy expressed considerations to the FCC concerning the consolidation of native information retailers elevating prices on shoppers and hollowing out the native information reporting that's very important to the well being of our democracy.”
Allen additionally informed The Publish his “donations to quite a few Democratic politicians and PACs don't have anything to do with Tegna and every part to do with defending our democracy.”
An FCC spokeswoman stated, “Below longstanding precedent, the Fee doesn't touch upon pending transactions. On this case – as in all circumstances – the Fee has a statutory obligation to find out that an project or switch serves the general public curiosity.”
Insiders stated Pelosi’s machinations might clarify why the FCC on Sept. 29 — every week earlier than she despatched her letter — requested for extra info from Commonplace Normal and Tegna, pushing the shut of its merger investigation a minimum of a number of weeks past an preliminary Oct. 18 deadline. Certainly, it’s doubtless that the Home’s Workplace of Legislative Affairs let the FCC Chairwoman know the letter was coming, in line with one lawyer.
“You don’t need to shock an company head when they're in your personal get together,” the lawyer stated.
It’s not unprecedented for highly effective politicos to place strain on FCC commissioners on behalf of huge donors, however “since she has no constituent who could be affected, it's uncommon,” stated Mark Lipp, a associate at regulation agency Fletcher, Heald & Hildreth who labored on the FCC for 14 years.
“I’ve seen some commissioners stand up to that type of strain and seen others buckle,” Lipp stated.
The loudest opponents of the Tegna deal, NewsGuild-CWA and the Nationwide Affiliation of Broadcast Workers and Technicians-CWA unions, have prodded the FCC for information about why Tegna rejected the Allen bid. The unions’ lawyer is David Goodfriend, who works as a lobbyist for Allen’s Climate Channel, in line with the US Home of Consultant’s Clerk Web site.
“That’s feels like greater than a coincidence,” in line with Lipp.
The delays have thrown the Tegna deal into jeopardy, insiders say. Some speculate FCC Chairwoman Rosenworcel will merely not carry the $24-a-share deal up for a vote earlier than the 4 commissioners, exercising what would basically be a pocket veto. She is beneath no authorized obligation to carry the deal to a vote, sources stated.
Buyers imagine there's a 60% likelihood the deal occurs based mostly on Tegna’s $20.62 closing value on Wednesday. And not using a $24-a-share deal, analysts imagine the Tegna shares would fall to about $16.50, a dealer stated.
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