When the Build Back Better Act passed the House of Representatives last year, there was some excitement about a provision in it authorizing a payroll tax credit for local news organizations. If the bill had not died in the U.S Senate last month, it would have provided tax savings for local media outlets amounting to nearly $1.7 billion over 10 years. Supporters of the bill in the U.S Congress have vowed to bring it up again this year with the hope of funding a range of social, economic, education, health and national security priorities.
Researchers at the University of North Carolina Hussman School of Media and Journalism found that there are at least 200 counties in the U.S. lacking a local newspaper and the Pew Research Center reported a decline from 71,000 journalism positions in 2008 to 31,000 in 2020, a 57 percent drop. The dismantling of local news reporting has diminished its role in providing important public oversight that holds our government accountable; promotes fairness, honesty, equity and justice; and preserves the integrity of our democracy. So, the decline in local papers is real and disturbing. But those pushing a payroll tax credit for media outlets as the answer to the problem are way off the mark.
The legislation and the discussion around it miss a very important point concerning small community newspapers, in general, and Black newspapers in particular, which have now been in existence for 195 years. Many of our small local newspaper businesses operate at a loss. We do not need a tax credit. We have a hard time making payroll. As a result, most small newspapers hire journalists as independent contractors because they can’t afford payroll taxes and benefits. So, how would a payroll tax credit benefit us?
The solution for helping cash-strapped media outlets, and, by extension, solving the crisis facing local media businesses across the country, requires generating sufficient revenues that would allow us to hire journalists and other staff either on payroll or as independent contractors.
If the President and the Congress really want to help small newspapers, which have declined from 5,000 community newspapers a few decades ago to less than 2,000 today, there is a fix that can be a win-win for all those concerned. The President should issue an executive order requiring all bids for government contracts under the Build Back Better Act and the Bipartisan Infrastructure Law (Infrastructure Investment and Jobs Act) to adhere to Title V of the U.S. Code’s Administrative Procedures Act, which requires the publication of “Notice” under due process. Those notices must also be inclusively published in local newspapers as a mandate so that small businesses and independent contractors are aware when government contracts are announced, allowing them to compete in the procurement process. The publication of such notices in local newspapers would bring both awareness and dollars to the communities of Main Street.
Those dollars would help local newspapers hire journalists in a way far more meaningful than tax credits to people who already can’t afford payrolls. The President could make such an executive order so inclusive that the benefit would be far reaching and felt immediately.
Dr. John E. Warren is the publisher of The San Diego Voice & Viewpoint newspaper.
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