Local journalism helps maintain a strong foundation for our democracy. If public figures know their actions may be scrutinized and shared, they are more likely to act appropriately. Your ability to participate in government—whether by voting on local issues or on candidates for office—is enhanced when someone shares the details of what is happening. If you see your neighbors volunteering or helping to solve an issue, you may be more likely to act.
Beyond helping create a well-functioning society and an accountable government, for those who work on policy issues, one of the best-kept secrets to doing good policy work is to read the newspaper. In addition to getting good information and stories, by being a regular reader, you start to pick up on trends, emerging issues, what is gaining momentum, and how public sentiment may be shifting—all important for doing policy work.
A couple of weeks ago, I had just set down the latest copy of the Midcoast Villager when one of my Island Institute colleagues sent me information about a policy change adopted by some states to support their local newspapers.
Nationally, local newspapers and journalists are in decline. In the last 25 years, the U.S. has seen the number of journalists per 100,000 residents drop from about 40 to eight, according to national research by Muck Rack. This isn’t just a national trend; while Maine has some excellent local news sources, coverage is patchy at best. Some Maine counties, such as Sagadahoc, Somerset, and Waldo, are well below the national average and rank in the bottom third of counties nationally. In better news, Hancock leads Maine in local journalists per capita and is ranked 223rd out of 3,141 counties nationally.
One-way other states have begun to address the challenge of limited local journalism is by making it easier for news outlets to dedicate staff to this important coverage. These policies focus on both supporting the hiring of new journalists and retaining existing local journalism jobs. This happens through the tax code—with a tax credit for hiring local journalists and a separate, smaller job-retention credit.
The job retention tax credit is valued at $20,000 per journalist for the first five positions, then drops to $15,000 per additional journalist. This provides more support to smaller, independent media outlets that tend to cover important local issues and often face some of the most significant financial hurdles.
The new hire tax credit is a one-time credit worth $15,000 for each additional journalist added to the newsroom’s headcount. Tax credits are beneficial because they directly offset tax liability—$1 in tax credits is $1 you don’t have to pay on your taxes.
Allowing the credit to be claimed by entities with tax liability as well as those with limited or no tax liability is key to how this policy supports local news in smaller, more rural communities. In tax policy terminology, this means the credit is refundable. Whether the news outlet is a small business that doesn’t turn a profit or a nonprofit, all of our news organizations provide an important public service and should benefit from the tax credit.
A couple of important tax policy provisions make these ideas more effective.
- These credits are stackable—meaning that in the first year of a new hire, the news outlet would benefit from both the retention and new-hire tax credits.
- The credits are platform-neutral—so while I talk here about local newspapers, they apply to other forms of journalism as well.
- They are content-neutral, meaning any news outlet that meets certain objective standards qualifies. This is important because it removes any temptation for government officials to evaluate the “quality” or viewpoint of the news source.
- Organizations controlled by 501(c)4 political organizations are not eligible.
Other states that have moved forward with this kind of approach include Illinois, New York, and New Mexico. In Illinois, during the first year the credits were in effect, $4 million in credits were claimed, supporting 260 journalism jobs across 120 outlets. Two-thirds of the recipients of these funds were news organizations with six or fewer journalists.
Maine would be well served by adopting these tax credits and providing strong support for local journalism.
Nick Battista is chief policy and external affairs officer for Island Institute, publisher of The Working Waterfront. He may be contacted at nbattista@islandinstitute.org.
