Federal bipartisan bill aims to help community newspapers

REGION — It is no secret community newspapers are struggling financially, especially since the COVID-19 pandemic began.

However, there may be some relief coming from the federal government through the Local Journalism Sustainability Act (H.R. 3940), sponsored by Reps. Ann Kirkpatrick (D-Ariz.) and Dan Newhouse (R-Wash.). The two legislators introduced the bill to the U.S. House of Representatives on June 16 and would establish three tax credits for local journalism.

“The Local Journalism Sustainability Act is a lifeline for community newspapers like the Coast News Group,” Coast News Associate Publisher Chris Kydd said. “Its very existence should remind voters how important community newspapers are to our democracy. The $250 tax credit for subscriptions is nice to incentivize readership, but the $50,000 annually for reporters, and the tax credit for business are the real game-changers for our business model.”

According to America’s Newspapers, a journalism advocacy organization, the first credit incentivizes annual subscriptions to local papers that primarily produce content related to local news and current events. The credit can also be used for nonprofit publications.

The bill defines a “local newspaper” as a print or digital publication that derives original content from primary sources relating to news and current events; primarily serves the needs of a regional or local community;  employs at least one local news journalist who resides in the area and not greater than 750 employees.

The subscription credit would offer up to $250 per year covering 80% of the cost in the first year and 50% of the cost in the remaining four years, according to the bill. To receive the credit, a subscriber must spend at least $312.50 in the first year and $500 in the following four years.

The second is a five-year credit for local newspapers to employ and adequately compensate journalists. This credit offers newspapers up to $25,000 in the first year and $15,000 in the subsequent years.

It would cover 50% of compensation in the first year and 30% thereafter. Also, journalists must work a minimum of 100 hours per quarter.

The third credit is also a five-year tax credit to incentivize small businesses to advertise with local newspapers, as well as local radio and television stations, per America’s Newspapers. According to the bill, it would cover up to $5,000 in the first year and $2,500 over the next four years.

The credit would cover 80$ of the advertising costs in the first year and $2,500 for the next four years. Advertisers would have to spend at least $6,250 in the first year and $5,000 after.

“When this bill passes, and we are fighting to make sure that it does, our job will be to educate our customers about the program,” Kydd added. “We are confident that if we show the small businesses in our community how to get the $5,000 tax credit, they will feel compelled to spend it with our publications and invest in both their business and independent journalism in their community. Equally as important is that this bill will allow us to pay better wages to our journalists.”

The bill currently has 41 co-sponsors including California Reps. Mark DeSaulnier (D-11), Ro Khanna (D-17), Jimmy Panetta (D-20), Adam Schiff (D-28) and Eric Swalwell (D-15).

A message left with America’s Newspapers’ CEO Dean Ridings was not returned by deadline.