[News]

• Elections Bring Major Changes
• AAF Files Comments With NTIA
• FDA Calls for DTC Prices in Television Ads
• Cincinnati Billboard Tax Repealed
• Advertising Day on the Hill

A big transformation in power is coming to Capitol Hill in 2019, as the Democratic Party won control of the U.S. House of Representatives 234 seats to 201 ending complete Republican control of both Houses of Congress and the Presidency. The Republicans slightly increased their Senate majority from 51-49 to 53-47.

While split control is usually a recipe for gridlock, many observers believe there is a chance that Congress could be more productive in the next two years than in the last two when Republicans had complete control. The only major piece of legislation passed in the last two years was the Tax Reform Act of 2017. The argument that the next two years could be more productive is based on the theory that each party will want to prove it is capable of governing and find ways to work with the other side.

There are also a number of issues, such as privacy (see following story) and infrastructure, that have broad bipartisan consensus and could see across-the-aisle cooperation.

With the change in party control, the House will see major changes in leadership. Many of the newly elected Democratic Representatives have pledged not to support former Speaker Nancy Pelosi, D-CA, in her bid to regain her former post when the decision is made in January. However, no viable challenger has emerged, so barring major developments she seems likely to become Speaker again.  House Minority Whip Steny Hoyer, D-MD and Assistant Democratic Leader Jim Clyburn, D-SC, are bidding to remain in their posts in the majority, but if Rep. Pelosi is chosen as Speaker some of the new members may push to make a change in this next level of leadership.

On the Republican side, Speaker Paul Ryan, R-WI, did not run for re-election. His deputy Majority Leader Kevin McCarthy, R-CA, was selected to lead the caucus as Minority Leader beginning in 2019.  Rep. Steve Scalise, R-LA, will remain as Republican Whip.

On the Senate side, most leadership positions will remain the same. Senator Mitch McConnell, R-KY, will continue to serve as Majority Leader. Majority Whip John Cornyn, R-TX, is stepping down due to term limits and will be replaced by Sen. John Thune, R-SD.

Senate Democratic leadership will be unchanged with Sen. Chuck Schumer, D-NY remaining as Minority Leader, Sen. Dick Durbin, D-IL as Minority Whip and Sen. Patty Murray, D-WA as Assistant Minority Leader.

Democrats also made significant gains in Gubernatorial and State Legislative elections, although Republicans still hold an advantage nationwide. These results are particularly significant as redistricting approaches since controlling that process makes it significantly easier to draw legislative districts favorable to the party in control and thus remain in control.

Thirty-six states held Gubernatorial elections. Prior to the election, 33 states had Republican Governors, 16 had Democrats and one was independent. In 2019, 27 states will have Republican Governors and 23 Democratic.

Prior to the election, Democrats controlled both the state Senate and House in 14 states, Republicans in 32 states, and four states had split control (Nebraska has a non-partisan unicameral legislature).

In 2019, Democrats will control the House and Senate in 18 states, Republicans will control both in 31 states and one state will have split-party control.

Finally, before the election, Democrats controlled both Houses of the legislature and the Governor’s mansion in eight states and Republicans in 26, with 16 states having split control.

In 2019, 16 states will still have split control of legislative chambers and the Governorship. Twenty-three states will be under complete Republican control and 14 under complete Democratic control.

The AAF has joined with a number of our sister associations to file comments with the National Telecommunications and Information Administration in response to the agency’s request regarding Developing the Administration’s Approach to Consumer Privacy.

The comments focused on the success of the current regulator regime combining targeted sectoral privacy laws, enforceable self-regulatory programs, such as the Digital Advertising Alliance and strong Federal Trade Commission enforcement.

However, the associations also recognize the reality that many local jurisdictions are considering enacting local laws that hold the real possibility of being inconsistent or contradictory with other local laws or the federal standard. Such a patchwork standard would “break the well-functioning, data-driven economy, diminish the value created for consumers and hurt job creation and innovation.”

The associations suggest “a preemptive, federal law to set a national standard focused on identifying reasonable data practices, prohibiting unreasonable practices and using a risk-based approach to prevent concrete consumer harms.” Such an approach would serve to protect and serve consumers and businesses by setting reasonable privacy standards and allowing the creation of innovative digital practices that would work to the benefit of both.

AAF recognizes that a national standard would likely require Congressional action. We look forward to working with lawmakers, regulators, AAF members and our association partners to achieve this mutually beneficial goal.

The U.S. Department of Health and Human Services has issued a proposed rule requiring pharmaceutical companies to disclose the price of prescription drugs in direct-to-consumer television advertising. HHS Secretary Alex Azar has said he believes the disclosures will help keep drug prices down.

AAF has a number of concerns about the proposal. Mandating speech always raises First Amendment issues. The information may also be more confusing than illuminating. Because of Medicaid, Medicare and the complex nature of insurance coverage, the list price of drugs is rarely the price that a patient pays.

In June, the Cincinnati City Council passed an excise tax on billboards. The tax drew immediate opposition from the local outdoor advertising industry and AAF-Cincinnati. In the reaction to this strong pushback, on October 10, the Council voted unanimously to repeal the tax.

In addition to the political opposition, Lamar Advertising Company and Norton Outdoor Advertising sued the city on constitutional grounds contending the tax was a burden on speech that violated the First Amendment of the Constitution. On October 17, a judge in the Court of Common Pleas accepted that argument and invalidated the tax.

Registration is open for AAF’s 2019 Advocacy and Action: Advertising Day on the Hill in Washington, D.C., March 6-7, 2019. Make plans now to attend this important event. As discussed earlier, there have been many changes on Capitol Hill. One thing that has not now or ever changed, is the importance of the advertising industry making our voice heard on the issues that impact how we do our job.

The event will start March 6, with our opening dinner to set the stage for the following day, meeting old friends and making new ones.

The morning of March 7, you will be briefed by experts on the important issues facing the advertising industry. The afternoon will be spent visiting with your Senators, Representatives and staff to explain the value of advertising to the economy and the implications, positive or negative, of proposed laws on the advertising industry.

Every attendee will receive issue briefs prior to arriving in D.C., and AAF staff will make your appointments on the Hill. Please register early so we have maximum time to arrange your visits.

Hotel rooms have been reserved at the Hyatt Regency on Capitol Hill, just a block away from the venue and walking distance to the Capitol. You may reserve your room by February 13, online or by calling 202-737-1234.  Be sure to mention that you are with American Advertising Federation, group code G-AMMF.

Registration is only $50. We look forward to seeing you in Washington, D.C. for AAF’s Advocacy and Action: Advertising Day on the Hill. Please contact AAF EVP-Government Affairs Clark Rector at crector@aaf.org if you have any questions.