Millions of dollars to save local news are now flowing in Illinois, one of a few states stepping up to address the local journalism crisis.
The state’s legislature agreed last year to provide up to $5 million in tax credits annually for five years to sustain local newsrooms and incentivize the hiring of more journalists.
So far 61 news organizations applied and 49 are receiving credits worth $4 million, mostly outside of the Chicago metro area, according to an Aug. 7 report by the Local News Initiative at Northwestern University’s Medill School.
It obtained public records that said seven more applicants are pending.
The credits aren’t big or extensive enough to save every failing news outlet or produce a local-journalism renaissance. But they will help stabilize recipients and enable investments that improve their chances of long-term success.
Several publishers told me the credits are a critical boost.
“It’s really a big benefit to small newspapers like ours who are facing some challenging times,” Jim Slonoff, publisher of The Hinsdalean, a suburban Chicago weekly newspaper, said by phone.
The Hinsdalean is receiving credits worth $45,000, nearly equivalent to a month’s revenue for the newspaper, Slonoff said. It employs four people full-time and four part-time and will use the proceeds in part to fund overdue hardware and software upgrades.
Illinois outlets are eligible for up to $15,000 in credits for each journalist employed over the last year and another $10,000 for newly hired journalists. Local outlets can receive up to $150,000 apiece. Big chains and news groups owned by Wall Street types are limited to $250,000 across their Illinois holdings.
“Yeah, that’s a big deal. Every newspaper, we’re trying to keep things frugal and not overspend and that’s been very much a key to our success,” said Todd Wessell, whose family owns 13 weeklies and a monthly in the area around O’Hare International Airport.
Their Des Plaines Journal Inc. is receiving $75,000, per the records published by Medill. Wessell said they employ 10 full- and part-timers and three or four photographers.
New York also created a refundable tax credit program for local news outlets last year, totaling $90 million over three years. It’s providing credits up to $25,000 per employee, capped at $300,000 per outlet.
Washington state doesn’t have an income tax to refund but in 2023 legislators decided, nearly unanimously, to exempt local news publishers from its business and occupation tax for 10 years. Since 2009 the state offered publishers a reduced rate. The new program fully exempts them for a decade, saving publishers an estimated $10 million in total.
Tax credits are one of the most direct and immediate tools for supporting local news outlets. They save jobs and prevent closures in an industry that’s seeing the loss of 2.5 newspapers a week, on average.
Ideally they would be universal, to avoid tricky questions about eligibility and lower the administrative burden, but states can only do so much.
A federal version is ultimately needed if the country wants to stop the local news industry’s bleeding and address the growing divide between places that do and don’t have local news available.
Proposals in Congress for journalism tax credits received bipartisan support but failed to advance in recent years. For the time being it’s probably a pipe dream, with leadership defunding and demonizing media organizations.
Reflecting the climate, Ohio’s legislature in June voted to kill a sales tax exemption for newspapers that was in place for 90 years. But it was vetoed last month by Gov. Mike DeWine, a Republican, who said it’s in the public interest to continue supporting the press.
“Absolutely nothing’s going to happen at the federal level, it’s going to have to happen at the state level,” said Sam Fisher, a former publisher and retired Illinois Press Association executive.
The Illinois credits were championed by state Sen. Steve Stadelman, a former broadcast journalist.
Stadelman also proposed a bill to help local outlets get fairly compensated by tech giants profiting from news, similar to the Journalism and Competition and Preservation Act proposed in Congress, but it failed to advance.
The first round of Illinois grants will benefit 120 news outlets operated by the grant recipients, per Medill’s report. The school’s 2024 tally found the state had 446 news outlets, including 316 newspapers.
Since 2004, Illinois lost 45% of its newspapers and that’s not counting a batch that abruptly closed last week.
Rochelle, Ill.-based News Media Corp. abruptly closed last Thursday, shuttering newspapers in five states, including seven in Illinois and papers in Wyoming, Arizona, South Dakota and Nebraska, The Associated Press reported.
State tax credits should help other publishers and communities avoid that fate.
That in turn could help convince a future Congress that this relatively small investment is worthwhile to shore up local-news infrastructure that voters and the public need, trust and value.
As DeWine said in his veto message, “Newspapers serve a critical role in our society to inform the public about important issues, allow for civic engagement and discourse, and help bolster local communities.”
Wyoming papers saved: Wyoming newspaper veterans are saving eight of the newspapers that Illinois-based News Media Corp. closed last week.
All staff will be rehired and publication will resume immediately, according to a WyoFile report.
The papers were acquired by Robb and Jen Hicks, members of a longtime newspaper family and owners of the Buffalo Bulletin, and Rob Mortimore, who was News Media Corp.’s Wyoming publisher.
“We are honored to assume stewardship of these legacy community newspapers,” Robb Hicks said in an announcement posted by the Torrington (Wyoming) Telegram.
“Our foremost priority has been to ensure that these counties are not left without a credible, enduring source of local journalism.”
This is excerpted from the free, weekly Voices for a Free Press newsletter. Sign up to receive it at the Save the Free Press website.
