Bloomberg Government subscribers get the stories like this first. Act now and gain unlimited access to everything you need to know. Learn more.
A coalition of state broadcaster associations seeking to cash in on TV and radio ads for marijuana products hired a team of lobbyists with ties to senior lawmakers to secure congressional approval to air spots for pot.
Broadcasters, which are federally licensed, can’t take cannabis money because the drug is still illegal at the federal level. Thirty-six states now allow medical marijuana, and 18 also allow recreational use.
“You already see billboard ads out there, you’ll see ads online, you will see ads in the press, but broadcasters—because I still have a federal license—we’re the only media entity that can’t,” said David Donovan, president of the New York State Broadcasters Association.
His group is one of 20 other state broadcasting associations, including ones with members in California, Arizona, Oklahoma, Virginia, Texas, Ohio and Michigan, who’ve formed an informal group called the Safe Advertising Coalition.
The coalition hired bipartisan boutique lobbying firm Klein/Johnson Group to work with policymakers on its behalf, according to lobbying registration filed with Congress. The contacts on the account are the firm’s co-founders Izzy Klein, who was an aide to Senate Majority Leader Chuck Schumer (D-N.Y.), and Matt Johnson, who was chief counsel to Sen. John Cornyn (R-Texas) on the Judiciary Committee. Also working on the account is firm principal Ian Rayder, who was deputy chief of staff to Rep. Debbie Wasserman Schultz (D-Fla.).
Donovan said the advocacy work began about four weeks ago, so meetings are only beginning on Capitol Hill. It’s unclear if there will be standalone legislation or whether it could be an amendment attached to larger legislation.
Donovan said he hopes to work with other industries including banking that also have run into limits in how they can interact with cannabis businesses because of its federal status as a Schedule I drug.
There are limits on non-broadcast cannabis-related ads that are set by states, such as not being able to market to children. Platforms can self-police as well, and sites such as Facebook and Google don’t allow cannabis ads.
Donovan said the economic downturn spurred by the Covid-19 pandemic put a dent in advertising revenues, and the new ad money could be helpful as broadcasters recover.
Overall advertising revenues in the radio industry decreased nearly 24% in 2020 compared to 2019, according to BIA Advisory Services’ 2021 Investing In Radio Market Report. Donovan said some New York stations were hit particularly hard, losing about half of their advertising revenues in the second quarter of 2020, compared to the same period in 2019.
“We have an advertising opportunity through the legalization of cannabis opening up,” Donovan said. “We all looked at it, looked at each other across the table, and said, ‘Let’s see if we can do this.’”
The National Association of Broadcasters, a national industry group, “supports federal policies that affirm that broadcasters may advertise cannabis products that are legal in their state without risk to their FCC license or other penalty,” spokeswoman Ann Marie Cumming said in an email. “NAB is aligned with the state broadcaster associations and working with them on this issue.”
To contact the reporter on this story: Megan R. Wilson in Washington at email@example.com