An Advertiser Finds a Spot on Public TV : Television: An L.A. rug business’s underwriting of ‘Art Underfoot’ is a case study in how far the rules have been bent since public stations have been allowed to accept money from commercial establishments.

In these days of TV commercials masquerading as full-length programs, it probably will surprise few viewers to see that “Art Underfoot,” a series debuting today about fine art carpets, is being backed by a local rug dealer.

It is even less of a surprise that the dealer, Moses Haroonian, is offering special discounts to customers who mention the program when they come into his store, the Oriental Rug Center in Los Angeles.

But “Art Underfoot” is no cheaply made info-mercial, running on an obscure cable or UHF channel. It is a high-gloss series meant to showcase the cultures of the people who make rugs. It was produced for the Public Broadcasting Service and is running--along with two 15-second announcements about Haroonian’s support--for 10 weeks on noncommercial KCET Channel 28.

Changes in PBS funding regulations during the Reagan Administration, encouraged by Congress and the Federal Communications Commission and reinforced by the FCC as recently as last week, allow public television stations to accept underwriting from businesses whose commercial endeavors are related to the subject of the program, as long as they are not involved in shaping the content of the program.

KCET’s sale of underwriting rights for “Art Underfoot” is a case study in how far the rules have bent since the days when commercial ties to public television programs were prohibited.

Haroonian found out about “Art Underfoot” through the community of rug importers and retailers of which he is a part. Like dealers across the nation, he decided to offer to underwrite the program locally, assuming that he would be able to capitalize on his $5,000 investment.

“To us, this program is one of the most important steps being taken to make people understand about rugs,” Haroonian said in an interview. “To really understand how they are produced and where they come from, and really know the product from a different perspective.”

Careful to comply with the rules as KCET explained them, Haroonian taped a 15-second announcement about his store to run at the beginning and end of each of the series’ 10 programs.

He then proceeded to conduct his own, separate advertising campaign. He prepared an expensive, color mailer that invited recipients to watch the program--and offered them “a 10% discount on our already reduced sale prices” if they followed up with a visit to the store. He planned to take out ads in newspapers and on radio making the same offer.

The invitation identified Oriental Rug Center as a “sponsor” of the program, not an “underwriter,” and used the KCET logo. The store encouraged viewers to tune in because “the more you know about rugs, the easier our task will be.”

“If they mention the program (when customers come into the store), they automatically get a 10% discount,” Haroonian said in the interview. “And we’re going to have a question-and-answer event where people can come in during the 10 weeks (and ask about rugs). We are going to mention that in our advertising. We also have a pretty large mailing list.”

KCET spokeswoman Barbara Goen said that Haroonian had used the station’s logo without permission and had incorrectly identified himself as a sponsor, but insisted that neither his behavior nor the station’s acceptance of his underwriting dollars broke the rules on funding of public television.

“They (Oriental Rug Center) were not involved with the program, they had nothing to do with its production. So the fact that they make the product that is being looked on in the series isn’t an issue,” Goen said.

Nationally, PBS’ underwriting guidelines prohibit financial contributions from people and firms with a direct involvement in the editorial content of the program, said spokeswoman Mary Jane McKinven. They are also meant to ensure that the public does not come away with the perception that an underwriter has an interest in a program, she said.

But when it comes to consumer-oriented or “how-to” programs, the rules are not as strict, she said.

“The perception test is applied much more stringently to news and public-affairs programming than in this realm of how-to’s,” McKinven said. And at the local level, she added, underwriters come on board long after the program has been produced, so even the perception of conflict of interest is not a consideration.

“This kind of match-up is not unusual in local underwriting,” McKinven said. “The program is done, it’s down the pike. They’re not going to go back in and break into the editorial content.”

But critics say it’s only natural that PBS’ relaxed underwriting rules have led to aggressive marketing behavior like that of Haroonian, and worry that such behavior may lessen the credibility of public broadcasting--or worse, make it appear that KCET is endorsing a particular business.

“The problem is the perception and the possible reality of a relationship between public broadcasting and commercial enterprises,” said Geoff Cowan, a former board member of the Corporation for Public Broadcasting who now teaches mass communication courses at UCLA.

“I think it’s perfectly appropriate to encourage corporate sponsorship and underwriting,” Cowan continued. “But where the line ought to be drawn would be where there appears to be a direct link between the program being aired and the product being sold.”

KCET’s experience with Haroonian is not the only sticky underwriting situation in which public television recently has found itself. Bob Vila, the host of PBS’ popular housing renovation program, “This Old House,” was asked to leave the Boston-produced series last year after he made commercials for products used in construction and renovation.

And Sharon Baker, who produced “Art Underfoot,” said that she personally called a rug dealer in another city (which she declined to identify) and asked him to stop running advertisements linking his store to the program. The dealer, who was not the program’s underwriter, complied, she said.

KCET’s experience with Haroonian “makes me very uncomfortable,” Baker said. “It cheapens our whole effort.”

Larry Grossman, a former president of PBS who now teaches at Columbia University’s Gannett Center for Media Studies, said that the network now relies so heavily on underwriting that corporate interests are beginning to influence the types of programs shown on public stations.

“(Boston PBS station) WGBH had a real problem with ‘This Old House,’ when it turned out there was a lot of back scratching, and program content was being affected by who the underwriters were,” Grossman said.

“I also have the same problem with financial houses underwriting ‘Wall Street Week’ and other financial programs,” Grossman said. “We have all these (business) programs (on public television) because there are backers for them, but I don’t see very many programs about labor issues.”

Steven Bass, director of corporate support for PBS, disagreed. Public television has “a very balanced source of support which ensures that no one entity is driving anything,” he said. “The fact of the matter is, in terms of our national programming expenditures, corporate underwriting accounts for less than 30%, which means that more than 60% is coming from viewer support and local stations and the federal government and other support.”

It’s not realistic to think that public television can get by without corporate sponsorship, Bass said, because federal support was dramatically cut back during the 1980s, and the network simply can’t survive on membership drives alone.

And when businesses contribute funds to an organization or project, they expect to get something out of it.

“The fact of the matter here is you always have a delicate balance,” Bass said. “On the one hand, the expectation is that companies are supporting programs for totally selfless reasons, and at the same time we know that nobody does anything for totally selfless reasons.”

KCET’s Goen said that the underwriting on “Art Underfoot” has raised serious concerns at the station, and might lead to changes in the way relationships with underwriters are handled.

“I think if anything comes out of this for KCET, it’s that we would ask our local underwriters to stay in closer touch with us on what they are planning to do,” Goen said.

But neither KCET nor PBS is likely to change its policy of encouraging companies to underwrite programs in their areas of interest, or to ask them not to publicize their participation, said PBS spokeswoman McKinven.

“The underwriter has to see some benefit in associating themselves with a program,” she said.