When Identidad Latina launched in 2001, it was a free biweekly newspaper with a circulation of about 10,000 that covered Hartford and the surrounding areas for the Spanish-speaking population of Connecticut. But by 2009, it had cut back to 7,000 copies, because, like most local news organizations, its advertising revenue had declined substantially after the Great Recession forced widespread small business closures.
To weather COVID-19 and skyrocketing printing costs, Identidad Latina had to downsize again. It’s now a 32-page magazine that publishes every two months with a goal of posting at least three stories a day to its website.
Identidad Latina has survived thanks to a mixture of federal pandemic aid money, personal sacrifice, and cost cutting; it let go of six part-time staff members in 2020. The arrangement works, but the outlet squeaks by financially.
“It’s gotten harder to make ends meet,” said Ruth Espinoza, Identidad Latina’s co-founder and director. “The ads only come every two months now, but the paychecks still go out every two weeks.”
So when the Connecticut legislature failed in June to pass HB-6347, otherwise known as “An Act Concerning the Purchase of Print and Digital Advertising by the State,” it was a blow to Espinoza and her partners, Adelia Santa-Cruz and Jorge Alatrista. They were hoping the bill, which would have required the Connecticut government to spend half of its estimated $8 million annual advertising budget with locally-owned, in-state news outlets, would provide a much-needed cash infusion.
“We’re not asking for money for a frivolous reason,” said Espinoza, who worked a separate, full-time job as an accountant until she qualified for retirement benefits in July 2021. (Alatrista still has a second job, and the other six people who work on staff are part-time.) “We’re just asking lawmakers to consider local media. Making money from digital is going to take time. We need a bridge.”
Identidad Latina is one of dozens of local news outlets in Connecticut and hundreds across the United States facing this dilemma of declining revenue with little hope for a market-based solution. It’s a story that’s been written hundreds if not thousands of times, but the situation may be reaching a tipping point where increased government support is both more palatable and possible.
We need a bridge.
Ruth Espinoza, Director and Co-Founder, Indentidad Latina
Some of that change is timing; a bill can take several tries to pass, and legislative efforts across the country may finally be ripening. Another factor is the sheer urgency of the matter. Since 2004, 2,886 newspapers have closed, and there are now 220 counties across the United States without a newspaper, according to the latest statistics compiled for the Medill 2023 State of Local News Report. But the closures, which are happening at a rate of two and a half per week, are only part of the problem. Many more news organizations are contracting, laying off staff to pay back the debt taken on by hedge funds gobbling up local chains or cutting back print runs because of declining subscriptions.
“It’s not uncommon for newspapers that once had a staff of 400 or more to have less than 40,” said Penelope Abernathy, visiting professor at Medill and co-author of the report. “What we depended on those large metros to do was unite a region or a state around common issues. We relied on them to have great beat reporters. We are missing the feature and investigative pieces that can save lives and address policy discrepancies.”
In response to the deepening crisis, legislation designed to reinforce local news outlets has been introduced in roughly 20 states and municipalities. In Wisconsin, a bipartisan group of lawmakers filed a proposal in December 2021 that would have given a tax credit of up to $5,000 to small businesses that advertise with local media outlets. It failed, but advocates hope to bring it back to life in the future, believing it will also boost struggling local retailers, whose revenue streams have been similarly upset by customers shopping online.
The District of Columbia is considering creating a voucher program that would set aside nearly $12 million, which represents 0.1% of the city’s budget, for local newsrooms. If passed, the funding would be allocated based on voter preferences expressed through a “news coupon” system designed to put up a firewall between the government and the media.
New Jersey has established what it calls a “civic information consortium” to disburse grants to outlets in news deserts and to those that cover marginalized communities. More than $5.5 million has been given out since 2018. In California, legislators appropriated $25 million to create a fellowship program that will place reporters in newsrooms throughout the state. Administered by the University of California at Berkeley, the initiative is believed to be the largest direct, state-level investment in local news in the United States.
At the federal level, there have been a few recent attempts to pass legislation, though the dysfunction surrounding the election of the Speaker of the House and the persistent threat of a government shutdown make it hard to see how much might get done between now and the next election. Still, there are two bills of note.
The Journalism Competition and Preservation Act, which would essentially allow news publishers to collectively negotiate a price with tech firms like Google and Facebook for using their stories, had bipartisan support, passing through the Senate Judiciary Committee by a vote of 15-7 last September, but it failed to move forward. Sens. Amy Klobuchar (D-Minn.) and John Kennedy (R-La.) reintroduced the legislation in March with five Democratic and six Republican senators signing on as original co-sponsors. It’s now waiting to be placed on the Senate calendar for debate. (Canada and Australia have seen some success with this approach. Google pays to use news content in both countries, while Facebook has an agreement that compensates Australian publishers.)
The Community News and Small Business Support Act, introduced in July by Rep. Claudia Tenney (R-N.Y.) and Suzan DelBene (D-Wash.), has two main provisions: a tax credit for employing local journalists and a tax credit for small businesses that advertise in local media. The credits would be available over five years, with the most generous assistance available in the first year when news organizations could claim up to $25,000 per employee, and small businesses could recoup a total of $5,000.
The bill had momentum in large part because it reframed the issue in terms of tax breaks for mom-and-pop shops. Thirty-two House members — 16 Democrats and 16 Republicans — are co-sponsors. The bill also picked up in October its first major endorsement from a business group, the National Restaurant Association, which sees the legislation as a symbiotic way to support both industries.
These bills have value even if they never become law, said Steve Waldman, president of Rebuild Local News, a nonprofit coalition working to advance public policy solutions to address the collapse of community journalism. They create a template for state lawmakers and other stakeholders looking to introduce legislation and to build bipartisan support. For example, the New York News Publishers Association and the NewsGuild-CWA are jointly supporting New York legislation, modeled on provisions in the Community Journalism and Small Business Competition bill, that would provide $500 million in salary tax credits over five years to news organizations in that state.
“There are risks to any legislation, but from what I’ve seen, the risks are outweighed by the danger of doing nothing,” Waldman said. “We are driving off the cliff, and we have to be looking at ways of changing course.”
Connecting Communities
Identidad Latina’s offices are tucked away on the first floor of the Connecticut Public Broadcasting building in West Hartford. The three rooms they rent — they get a “good deal,” Espinoza said — are small and sparsely decorated but none more so than the studio where they film Alatrista’s interview show. There are a few cameras and tripods, two stools and a banner with the outlet’s logo stuck to the wall with thumb tacks.
From here, Alatrista has interviewed community organizers, local chefs and state lawmakers, to name just a few. The paper has also covered the elections in Ecuador, convened a forum on why voting turnout among Latinos in Connecticut remains depressed and discussed with Hartford’s school superintendent how to prepare students for college.
But much of the value the audience sees in Identidad Latina comes from its presence at community events. Its Facebook and YouTube pages are a repository of videos from celebrations such as the Colombian Festival for Independence Day and the crowning of the queens of the Puerto Rican Day parade. “We are connecting communities through conversation,” Santa-Cruz said. “We are constantly asked, ‘Can you come to this? We want you here.’”
It’s the kind of work that’s filling a gap as the rest of the industry is shrinking. Since 2004, Connecticut has lost 56 newspapers, nearly half of the 120 newspapers operating in the state less than two decades ago. Other outlets, such as the Hartford Courant, the oldest continually publishing newspaper in the country, have been hollowed out by rounds of layoffs and cutbacks from hedge funds such as Alden Global Capital, which is notorious for consolidating operations and replacing local coverage with boilerplate regional stories. At its peak, the Courant, whose parent company was acquired by Alden, had a few hundred journalists covering towns across the state. It now has a few dozen.
We are driving off the cliff, and we have to be looking at ways of changing course.
Steve Waldman, President, Rebuild Local News
It’s against this backdrop that lawmakers are gearing up to get a refined version of HB-6347 reintroduced in February, when the legislature is back in session. The bill’s original sponsor, State Rep. Kate Farrar, is hopeful. In May, the House passed the measure by a 96 to 48 vote, but the Senate failed to act before adjourning. This was a setback but one that Farrar and other advocates feel they can build on — especially given that the bill is revenue neutral and affects only advertising money already in the state’s budget that would otherwise be awarded to faraway digital ad servers. Farrar has spent much of the past few months trying to build support within the Senate, the governor’s office and other state agencies.
“I think we have a good chance of moving this legislation forward,” Farrar said. “Last session there was a lot of focus on voting access bills in the committee, and with those passed it can be more of a priority for next year.”
Should the bill pass both houses and be signed by Gov. Ned Lamont, no one expects a few million dollars in state ad spending to fix all that ails local news in Connecticut. The problem is too complex to be solved by a single solution. But it would be a statement that local news is a priority and would reaffirm that the government has a role in ensuring the public remains informed in our democracy. It also has the potential to sustain small publications such as Identidad Latina, where even a few thousand dollars can mean the difference between making payroll or not.
“It would be very helpful even if the state put just a few ads with us,” Espinoza said, noting that extra funds could help them hire an employee to expand their digital operation and attract more of an online audience.
It’s not just the money; it’s also the consistency of the cash flow. Nancy Chapman – the founder and writer behind NancyOnNorwalk.com, a local website covering city government, education and land use since 2012 – became a full-time employee of her own company just three years ago. (She still doesn’t have health insurance.) The outlet has survived thanks to two well-timed infusions of money: A $25,000 fundraising match from the Institute for Nonprofit News kept the business going in 2018, and a $20,000 grant from the Knight Foundation helped relaunch the website in April, which it otherwise couldn’t afford to do. Recurring ad buys would help NancyOnNorwalk, which had an operating budget of $85,000 last year, to move past merely subsisting.
“If there is the potential for state money on a consistent basis, we’d start to have regular predictable income,” said Claire Schoen, a NancyOnNorwalk board member. “We would know that we could pay certain people certain salaries. We’d be able to hire more people to fundraise and hire more reporters.”
If Connecticut enacts HB-6347, it will join a handful of states that have recently passed legislation to support local media. Earlier this year, Washington Gov. Jay Inslee signed a measure that will exempt news outlets from the state business and occupation tax for a five-year period starting in 2024. It took two tries for Sen. Mark Mullet, a Democrat who has seen three papers in his district close since he was elected in 2012, to push the proposal through. When he first introduced the bill in 2022, he couldn’t get it voted out of committee. The feeling that the media is biased was too pervasive among lawmakers, even among Democrats who didn’t like many of the editorials that were being run at the time, Mullet said. But in March his colleagues in the Senate advanced the bill with a vote of 47-1. Less than three weeks later, the House passed it with a vote of 89-7.
“What a difference a year makes,” Mullet said. “ What happened was people just had honest conversations with their local papers and realized how difficult the environment is. They appreciated if you don’t have the papers, it’s really hard for the average Washington voter to know what their government is doing.”
The exemption is expected to save news organizations about $1 million a year. That’s not enough to restore the entire industry, Mullet conceded, but it’s an acknowledgment the government can help. “At the end of the day my argument was, the state of Washington does not want to add fuel to the fire,” Mullet said. “At a minimum, by exempting them from the business and occupation tax, we’ve done what we can to alleviate the pressure.”
Legislators also set aside $2.4 million over the next two years to establish a journalism fellowship administered by Washington State University. The funding is expected to put eight reporters in the field in 2024 and another eight the year after, but the larger goal is to survey the local news ecosystem and prove the fellowship concept can strengthen community coverage — especially in places where there may not be enough wealth to support media organizations through advertising or subscriptions.
People just had honest conversations with their local papers and realized how difficult the environment is.
Mark Mullet, Washington state senator
It’s modeled after California’s Local News Fellowship, the $25 million initiative established at Berkeley in September 2022. That program hired its first of three cohorts this summer and has placed 39 journalists in newsrooms such as Access Humboldt, a small community nonprofit; L.A. Focus, a newspaper that reports on the African-American experience in Los Angeles; and The Fresno Bee, which is expanding coverage into Madera County. (The focus in California is on small newsrooms. Of the 37 outlets where a fellow has been placed, 26 have staffs of fewer than 10.)
“Part of the appeal of the fellowship model is that it’s directly going after a core problem: the lack of journalists in local newsrooms,” Waldman said, noting a natural firewall is created because the money flows from the government through the university before it gets to the journalist. “As a political matter, there’s a familiarity with what a fellowship is. There’s a familiarity with state university systems … so there’s a certain amount of trust in these existing institutions.”
That dynamic played out in New Mexico, where in May state officials allocated $125,000 to subsidize a fellowship and internship program run by the New Mexico Local News Fund and the University of New Mexico. The program, launched in 2019, had previously relied on private grants and donations. With the extra funding, it has been able to expand to seven fellows and eight interns, a record number for both.
America’s founders: Press is essential to self government
One of the main obstacles to advancing legislation designed to aid struggling newsrooms is the perception that public support won’t make enough of a difference. For evidence to the contrary, one can look to our neighbors to the north. In 2019, Canada introduced a salary tax credit of 25% per journalist for news organizations. An assessment by the University of North Carolina’s Center on Technology Policy found that even the smallest hyper-local outlets reported the policy increased their bottom line by as much as 10%. As a result the credit was increased to 35% in 2023 and will extend through 2027.
Another obstacle is the idea that the free market should decide the winners and losers. It’s an argument internalized by journalists themselves because they fear that by accepting public funds, they open themselves up to government control or undue influence. But this fear is not grounded in historical context.
The Post Office Act of 1792 is often cited to illustrate the federal government’s long history of supporting journalism. In addition to setting delivery routes in granular detail and establishing that the penalty for robbing a mail carrier would be a death sentence, it capped delivery rates for a newspaper at 1.5 cents no matter where in the country it was going. That was a steep discount, as postage for letters cost between 6 cents and roughly a dollar, depending on the weight of the envelope and distance it was to travel. The law, which also allowed newspaper printers to mail single copies to each other for free, went so far as to specify that newspapers would need to be “carried in separate bags from the letters,” and it set a fine of up to $50 for post office employees who “detain, delay, embezzle or destroy any newspaper.”
The exacting provisions around newspaper delivery speak to the central role lawmakers saw for newspapers in keeping citizens informed — not just in the big cities but also in rural areas and across the frontier where printing presses were in short supply. To get news to people living outside of New York, Boston, Philadelphia and other urban centers required heavily subsidizing the distribution process.
“There wasn’t a debate about it,” said Robert McChesney, professor emeritus of communication and media history at the University of Illinois Urbana-Champaign. “That’s how singularly important the press was seen by the founding fathers. It was just understood that the press was central to the foundation of a self-governing system.”
McChesney and co-author John Nichols, a correspondent for the Nation, noted in their 2016 book, “People Get Ready: The Fight Against a Jobless Economy and a Citizenless Democracy,” that the information economy at the time depended largely on government support. “Newspapers constituted more than 90 percent of the Post Office’s weighted traffic yet provided only about 10 percent of its revenue,” they wrote. “If the United States government subsidized journalism in the second decade of the twenty-first century as a percentage of GDP to the same extent it did in the first half of the nineteenth century, it would spend in the area of $35 billion annually.”
Today $35 billion would go a long way for an industry that has lost almost two-thirds of newspaper journalists in the past two decades. To put this into perspective, the payroll taxes for news organizations that Congress nearly passed last year (as part of the Build Back Better legislation) would have invested about $1.7 billion over a decade. Another data point: The Press Forward initiative, a coalition of philanthropic funders looking to boost grants to local news outlets, pledged $500 million over the next five years.
Individual state tax breaks, fellowship programs or grant awards won’t solve the whole problem, but taken together they can make a difference. “Progress is never straightforward,” Medill’s Abernathy said. “We are holding our breath right now. But I’m increasingly optimistic that we may be moving together to fix this. You put together the legislative policy front, the renewed focus in philanthropy and scholars studying what this means for our society and democracy. We’re beginning to get enough of a collective movement to see what’s going to work.”
While all of these efforts take time to work their way through their respective processes, Espinoza and her co-founders hope that help comes in time for them to train the next generation of journalists to take over Identidad Latina.
“We love what we do, and we are happy that we are still working,” Espinoza said. “All we want, like other local media outlets, is some help to keep us going and to educate younger generations. We won’t be here forever, and we need to train the next generation.”
Laura Colarusso is the senior editor of Nieman Reports, a magazine dedicated to elevating the standards of journalism.
Article image by Alexander Grey used under Unsplash license (Unsplash)