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New legislation would offer incentives to advertise in, subscribe to local newspaper
09292017 THE TIMES

Congress is considering legislation that would offer tax credits to local newspaper subscribers, small business advertisers and for publishers to compensate journalists. 

The Local Journalism Sustainability Act, H.R. 3940, would give subscribers a tax credit of up to $250 to go toward a subscription for their local newspaper for the first five years that they subscribe. The tax credit covers up to 80% of the annual subscription cost for the first year and then 50% of the cost for the next four years, up to a maximum of $250 per year. So, if a subscription was $312.50 in the first year, then the subscriber would get the full tax credit of $250. 

Small businesses who advertise with a local media outlet, including a newspaper, radio station, TV station or other outlet, would be eligible for a tax credit of up to 80% of their advertising cost for the first year, up to $5,000, and 50% of their advertising costs for subsequent years, up to $2,500. Eligible small businesses include those which employ less than 50 people, as defined by the bill. 

Local newspaper publishers would get a tax credit for compensation of journalists up to $25,000 in the first year and $15,000 the next four years. In the bill, a “local news journalist” is defined as any person who regularly gathers, collects, photographs, records, writes or reports news or information that concerns local events or other matters of local public interest. A journalist must work 100 hours per quarter to qualify as an eligible employee. 

Appen Media Group publishes five weekly newspapers in the metro-Atlanta area, and its publisher, Hans Appen, said this legislation could be a sign that people in Congress are keeping local newspapers in mind.

“I’m appreciative that it’s getting some attention, because publishers need all the help they can get,” Appen said. 

The bill has some bipartisan support with 10 out of 39 co-sponsors from the Republican Party, though Appen said he worries this could become a politicized issue. But many local publishers have a close relationship with their Congressional representatives, which could help them see the need for a strong free press, Appen said. 

“We still can pick up the phone and call them,” he said. “Many members of Congress came up in city councils or county commissions where they were really connected to their local media.”

The old business model where news organizations depended on advertising as the primary source of revenue is no longer viable for many in the industry, said The Times’ General Manager Norman Baggs. 

“This legislation is not a handout to news companies. It’s a tax incentive for those individuals who pay to support them.”

The tax credits only last five years, so the legislation would give news organizations a chance to get back on their feet without the help being indefinite, Baggs said. 

The bill defines a “local newspaper” as any print or digital publication whose primary content is original content derived from primary sources and relating to news and current events. The definition also states that the newspaper’s content must primarily serve a regional or local community, must employ at least one journalist and cannot have more than 750 employees. 

The bill was introduced to the U.S. House of Representatives on June 16 by Rep. Ann Kirkpatrick, D-Ariz., and Rep. Dan Newhouse, R-Wash., and has since been co-sponsored by 39 representatives including two from Georgia: Rep. Hank Johnson Jr., D-Lithonia, and Rep. Sanford Bishop Jr., D-Albany. 

Rep. Andrew Clyde, R-Athens, did not have comment on the legislation by the time of publication.

Similar legislation, S.2434, was introduced in the U.S. Senate on July 22 by Sen. Maria Cantwell, D-Ariz., Sen. Mark Kelly, D-Ariz., and Sen. Ron Wyden, D-Ore., and has four co-sponsors as of Aug. 3.