The civic value of local newspapers tends to rise during crises such as the COVID-19 pandemic as readers seek out reliable, updated information on important events unfolding around them.
But because news organizations tend to rely heavily on advertising revenue, even an increase in subscribers doesn't guarantee the survival of media that have long played central roles in local discourse.
A bipartisan bill introduced in Congress proposes to help by providing a series of three limited-time tax credits designed to help local newspapers pull through the crisis.
The Local Journalism Sustainability Act, backed by Reps. Ann Kirkpatrick, D-Ariz., and Dan Newhouse, R-Wash., has gained the support of industry groups including News Media Alliance, National Newspaper Association, America's Newspapers, Report for America and Rebuild Local News Coalition.
As House Minority Leader Kevin McCarthy put it, local news organizations have established themselves as vital sources of information for communities.
“I will consider this legislative idea as Congress debates different proposals over the next few weeks to enact additional relief legislation that will provide consumers and businesses who support local media, especially our community newspapers, the resources and pro-growth economic environment necessary to support our vital community institutions,” the Bakersfield Republican said in an emailed statement.
Rep. T.J. Cox, D-Fresno, added that local journalism is how millions of Americans stay up to date with current events and local news.
"Representing the Central Valley, I know how important it is that everyone, no matter where they live, gets the broadcasting they need to be informed about local and global news," he said in an email, "This is why I co-signed a letter to House leadership along with over 100 of my bipartisan colleagues encouraging support for local news broadcasting.”
The proposed legislation would make tax credits available for up to five years to subscribers, advertisers and local newspapers themselves, defined as print or online publications with a majority of readership located in their state or within 200 miles.
Subscribers would receive a credit of up to 80 percent of their subscription costs the first year, followed by 50 percent each of the following four years. Annual, nonrefundable credits would be capped at $250.
Advertisers would be eligible for nonrefundable tax credits of up to $5,000 the first year and no more than $2,500 in each of the next four years. Up to 80 percent of advertising dollars spent the first year would be credited, and after that the ceiling would be 50 percent.
Only advertisers with less than 1,000 employees would qualify, and in this case, the definition of eligible local media would be expanded to include radio and television stations with at least 90 percent of their audience within a 50-mile radius.
The proposal would give newspapers direct support in the form of a refundable payroll tax credit worth no more than $50,000 during each of the bill's five years.
Publications would be able to claim a credit of up to $25,000 per journalist in the first year and up to $15,000 each in the next four years. It would cover no more than half of a newspaper employee's salary the first year and would max out at 30 percent the next four years.
Cliff Chandler, the publisher of The Californian, is urging readers and advertisers to let lawmakers know about the critical role local journalism plays in society.
"We ask that our valued readers and advertisers let their representatives know that now is the time to support this proposed legislation," Chandler said. "It's not just about The Californian, but all local journalism in communities across the country."
Georgia-based industry group America's Newspapers called the proposal an "assist, not a hand out" that would help local journalism "exist and transition during a time of COVID-19."
It urged its members to contact their congressional representatives to vote in support of a bill it views as "well thought out, comprehensive and provides the bridge for journalism to achieve a stable footing in a digital reality."