Nonprofit Future Possible For Newspapers

Senator Proposes Tax-Exempt Status Akin To Public Broadcasting For Struggling Publications

(CBS/AP)  Struggling newspapers should be allowed to operate as nonprofits similar to public broadcasting stations, Sen. Benjamin Cardin, D-Md., proposed Tuesday.

Cardin introduced a bill that would allow newspapers to choose tax-exempt status. They would no longer be able to make political endorsements, but could report on all issues including political campaigns.

Advertising and subscription revenue would be tax-exempt, and contributions to support coverage could be tax deductible.

Cardin said in a statement that the bill is aimed at preserving local newspapers, not large newspaper conglomerates.

"We are losing our newspaper industry," said Cardin. "The economy has caused an immediate problem, but the business model for newspapers, based on circulation and advertising revenue, is broken, and that is a real tragedy for communities across the nation and for our democracy."

Cardin said his proposal may not be the best choice for some major newspapers, but "should be an option for many newspapers that are struggling to stay afloat."

Speaking on the Senate floor, Cardin added, "As local papers are closing, we're losing a valuable tradition in America - critically important to our communities, critically important to our democracy."

The head of the newspaper industry's trade group called the bill a positive step.

John Sturm, president and chief executive officer of the Newspaper Association of America, said the proposal "recognizes changes in the law might be necessary to provide a boost to newspapers trying to weather this difficult economic period."

He agreed with Cardin that his approach may not work for all newspapers, but said the legislation is a starting point for discussions already under way on ideas to help the industry.

The association is a nonprofit organization representing the $47 billion newspaper industry and more than 2,000 newspapers in the United States and Canada.

Reports of layoffs and furloughs at newspapers around the country have become common in recent months. Gannett Co., which publishes 85 daily newspapers, announced Monday that it was asking most of its 41,500 employees to give up a week's pay for the second time this year. The same day, Advance Publications, which publishes daily papers in nearly two dozen cities, said it was ordering 10-day furloughs and a pension freeze at nearly all its daily newspapers.

In recent months, the Seattle Post-Intelligencer published its last print edition, the Denver's Rocky Mountain News folded and 33 others have file for Chapter 11 bankruptcy protection.

Last week, the San Diego Union Tribune was sold by its parent company to a private equity firm. And San Francisco Chronicle workers recently made massive concessions the paper's parent, Hearst Co., which said the paper was in danger of folding if it could not cut costs.

[seagee]

Your story about the demise of newspapers, though extensive and comprehensive, left out the most alarming development of the "new news": fact-checking. While aluding to it several times, you failed to acknowledge that today's instant communicator has not learned to discriminate among messages, nor seems to care. "Instant" is the key word; the reader simply incorporates messages, believes them and goes on.

As both an English teacher and public relations professional, I've demanded that my students and my own work employ the "sez who?" measure. If something looks like a fact, I want to know how the writer/speaker got to it. Without fact-checking we will have chaos. It's all just rumor, and, sadly, no one -- including your story editor -- seems to care.
Cheryl Gaston, APR

[jalbertb]

Just saw this story this morning. Is very interesting that you reported about this industry and while most your facts are true, you failed to report any bright light in this industry. Just doom and gloom. That may be the case for most of the industry because of technology and the way we now communicate to each other but here is one paper that is not going the way of the dinasour.
The Wall Street Journal is not only growing, is gaining readers every day! They are printing more newspapers today than they were a year ago. The paper is larger and has more sections and now they even have sports. A Saturday edition has been in place for over a year and I would not be surprised if a Sunday edition is in the works.
If you look at some of the News Corp reports about the state of WSJ, their advertising is holding up, is not terrific but are pulling a miracle in this financial down turn. Their readership is up and they are the only paper in the US that is hiring reporters and is expanding. And by the way.... they are the only paper with the largest paid subscription for their online edition, WSJ Online.
So they question becomes, if you are exploring the state of the future of newspapers in this country, why did you not investigate or report about the WSJ? Is the only bright star in this industry, it may doing terrific but is not doing losy either, is holding is own.
Either you don't want to investigate and have some kind discriminating towards this paper or is just bad investigative reporting.
Is not all doom and gloom and while that may give you higher ratings, please do some stories that show companies holding up their own in this economic crisis.