House Speaker Pelosi, Rep. Pallone Urge Closer Scrutiny of Standard General-Tegna Deal

Pelosi
Rep. Frank Pallone Jr. (D-N.J.) and House Speaker Nancy Pelosi (D-Calif.) at a May Capitol Hill news conference (Image credit: Tom Williams/CQ-Roll Call, Inc via Getty Images)

WASHINGTON—House Speaker Nancy Pelosi and Energy and Commerce Committee Chairman Frank Pallone, Jr. have expressed “serious concerns” about the proposed merger of Standard General with Tegna to FCC Chairwoman Jessica Rosenworcel 

Tegna, which manages 64 stations across 51 domestic markets, agreed in February to be acquired by Standard General for $8.6 billion including debt. The merger is currently being reviewed by the FCC and has faced a number of objections from lawmakers and public advocates and unions. 

In a letter to the chairwoman, the lawmakers pointed to the accelerating consolidation of local news outlets, and asked the FCC to closely review the pending transaction to ensure that it is in the public interest and promotes the FCC’s values of localism, competition and diversity on the airwaves.

In the letter, Speaker Pelosi and Chairman Pallone wrote: “By law, the FCC is required to determine whether the proposed transaction will serve the public interest, convenience, and necessity.  After reviewing the public record, we are concerned that this transaction would violate the FCC’s mandate by restricting access to local news coverage, cutting jobs at local television stations, and raising prices on consumers.

“Localism is a core tenet of broadcast journalism that serves the public interest – but we fear the proposed transaction could jeopardize that important goal,” the letter continued. “The proposed new owners previously told investors they believe Tegna’s local stations have too many employees, a potential signal of their intent to lay off local journalists. At the same time, they have described piping in news produced in Washington, D.C., to fill time on local newscasts as a public interest benefit, potentially leading to fewer local journalists and less local news.

“We urge you to fully examine the concerns raised by public comments – and shared by many of our colleagues in the Congress – about this proposed transaction, consistent with the applicable laws and regulations.”

In response, Standard General defended the merger, saying that the acquisition will "will yield significant public interest benefits without any countervailing public interest harms, including creating the largest minority-owned and female-led broadcast station group in U.S. history."

The company said Tegna will "actually be smaller" after the transaction, which goes counter to the lawmakers' claim of media consolidation and that there is no record of them proposing to supplant local news with news produced in Washington, D.C. It also said it doesn't plan on cutting jobs and that consumer price increase concerns are invalid since Tegna provides free over-the-air broadcasts. 

"We were... disappointed to see the FCC petitioners enlist the involvement of Speaker Pelosi and Congressman Pallone by misleading them with the same false statements they have been making to the FCC," Standard General said.

NewsGuild-CWA, among the groups opposing the merger, applauded the letter and asked the FCC to nix the deal. “Local news is being murdered by Wall Street firms who are only interested in cutting jobs to finance their debt,” the group said. “The FCC can stop this deal, protect local news and permit our members to serve the public with high quality local news.

“The letter from the Speaker and the Chairman is just one more reason the FCC should closely examine this deal and then block it in its entirety. There are no concessions Standard General can make that would turn this deal into one which serves the public interest. As the union of America’s journalists and media workers, we proclaim that it’s time for private equity to stop slaughtering our country’s free press.”

This article has been updated to include Standard General's response. 

Tom has covered the broadcast technology market for the past 25 years, including three years handling member communications for the National Association of Broadcasters followed by a year as editor of Video Technology News and DTV Business executive newsletters for Phillips Publishing. In 1999 he launched digitalbroadcasting.com for internet B2B portal Verticalnet. He is also a charter member of the CTA's Academy of Digital TV Pioneers. Since 2001, he has been editor-in-chief of TV Tech (www.tvtech.com), the leading source of news and information on broadcast and related media technology and is a frequent contributor and moderator to the brand’s Tech Leadership events.