December 16, 2021

As Congress slogs to its holiday recess, a subsidy for the salaries of local journalists — included in the mammoth Build Back Better bill — still has bright prospects, proponents told me this week, but consideration is likely to spill past the New Year.

Specifically, several members of the group steering advocacy of the measure met with staffers of Sen. Joe Manchin (D-W.Va.) and were assured that he strongly supports helping local news outlets, many of them struggling financially.

As has been reported (not by me), in a deadlocked Senate, Manchin holds the cards in what stays and what goes in the final version of the bill, which has a current estimated cost that exceeds $2 trillion.

If Manchin wants the Local Journalism Sustainability Act funded, with a modest first-year cost of less than $1 billion, that’s a victory in itself.

Dean Ridings, CEO of America’s Newspapers, was one of those who called on Manchin’s office. Ridings described the visit as a great meeting. But he was also told “that Sen. Manchin was much more concerned about getting the bill right than getting it passed quickly.”

Reports Wednesday afternoon confirmed that a Build Back Better bill vote has been rolled over to the start of 2022.

The bill provides for a 50% credit on the salaries of local journalists up to $50,000 in the first year after passage and 30% for the following four years.  Various local outlets, not just newspapers, qualify, including relatively prosperous local TV stations.

The benefit is easy for a qualifying news organization to calculate. I asked Ridings to make a hypothetical estimate for an outlet with a 50-person newsroom with an average salary of $40,000.

That would work out to $3.4 million over the five years — $68,000 per employee — and would be a big help on the expense side of the ledger.

Uncertainty over the front-loaded subsidy presents outlets, especially smaller and independent newspapers, with a budgeting challenge at a time when plans for the next year are typically locked in.

It is likely to make the difference between keeping news staffing levels whole or making cuts in the first quarter, if no legislation materializes by the end of January, one of the proponents told me on background. The revenue bounceback from the 2020 pandemic impacts has been less than expected, he said, and prospects for revenue next year are for less, not more.

Absent the federal help, he continued, “publishers have got to do something … and the question will be how many journalists you’re going to let go.”

The bill’s five-year sunset frames the issue as necessary short-term help to get the industry through a period of digital and business model transition.

Lingering in the background is a different piece of legislation, the Journalism Competition and Preservation Act, which has been pushed for years now by the News Media Alliance. It would allow newspapers and other outlets to negotiate collectively with Google and Facebook to get compensation for content the platform companies use and sell advertising against.

“The LJSA has strong bipartisan support, and we are optimistic that it can be passed in the near term,” David Chavern, president of the News Media Alliance, told me in an email comment. “However, we also know that its fate is now tied to the advancement of President Biden’s much larger BBB package, and the politics around that are complicated.

“Looking to longer-term solutions,” he continued, “we have worked hard on the terms of the Journalism Competition and Preservation Act and we strongly believe that it can be passed in 2022.”

The LJSA advocate who spoke to me for background agreed. The salary subsidy will be “a needed shot in the arm,” he said, but a revenue stream from the platform companies will also be essential before long.

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Rick Edmonds is media business analyst for the Poynter Institute where he has done research and writing for the last fifteen years. His commentary on…
Rick Edmonds

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