ALBANY, N.Y. (AP) — New York state is offering news organizations up to $90 million in tax breaks to help hire and retain journalists in an effort to help keep the shrinking local news industry afloat.
The U.S. newspaper industry has long been in crisis, with reasons including dwindling advertising revenue as newspapers have shifted from being primarily print to digital, prompting state lawmakers to step in to help through a measure passed in the state budget.
New York State’s three-year program allows some news organizations to claim refundable tax credits each year. A single news station can receive tax credits of up to $320,000 annually.
Democratic Senator Brad Hoylman-Sigal, who sponsored the bill, said preserving journalism jobs is critical to the health of democracy, citing as evidence the fact that New York’s weakened media failed to research the background of George Santos, a Republican who fabricated many details of his life story until he was elected to Congress.
“Some of my colleagues have referred to this loan as the ‘George Santos Prevention Act’ because many believe it was the lack of coverage in the local press that allowed Santos to spin his web of lies undetected,” Hoylman-Sigal said.
Although the tax credit is intended to benefit compact local news sites, larger media companies could potentially benefit as well. The tax credits would mainly apply only to news organizations that are not listed on the stock exchange, although there would be an exception for certain media companies that can demonstrate a decline in circulation.
Hoylman-Sigal said he would be open to amendments to extend the legislation to nonprofit news organizations and digital-only media, which are currently excluded from the program.
“This is the first time in American history that we have created a tax credit structure to support jobs in journalism,” said Jon Schleuss, president of the NewsGuild-CWA, a union for journalists.
In several states, lawmakers have considered different approaches to help struggling news organizations.
The state governments of California and New Mexico help fund local press scholarship programs.
California lawmakers are currently considering a bill that would require tech giants like Google, Facebook and Microsoft to pay a percentage of their advertising revenue to media companies when they link to their content. Google recently responded by temporarily removing California news websites from some users’ search results.
In Illinois, lawmakers have proposed a grant program for journalists, a tax credit and a requirement that news organizations give the state four months’ notice of plans to sell their businesses. Bills in Connecticut and Illinois would require a portion of the state’s advertising spending to go to local media.
Most of the measures pushed this year have been implemented in Democratic-controlled states. But Anna Brugmann, director of policy at Rebuild Local News, which advocates for government aid for journalism, said there is interest in the idea in Republican states as well. The problem, she said, is that the initiatives could be steep.
She noted that there were novel intelligence assistance bills in Wisconsin this year from both Republicans and Democrats.
“We are definitely targeting the red and purple states for the next legislative session,” Brugmann said.
According to a report last year from Northwestern University’s Medill School of Journalism, about 203 counties in the United States have no local news outlets. More than 1,500 – nearly half of the counties – have only one.
The New York program, which is set to launch in 2025, will provide tax relief in two pots: About $4 million in credits will help newsrooms hire staff, and about $26 million will help with staff retention.
Newsrooms could receive $5,000 in tax credits for each novel hire, capped at $20,000 or four novel positions. Newsrooms could receive up to $300,000 in tax credits to retain their staff.
“At a time when there is so much information, it is critical to our democracy as a country to have trained journalists who can ask the tough questions and hold elected officials and other public figures accountable,” said state Senator Jeremy Cooney, a Democrat who represents parts of the Rochester region in western New York.
Newspaper companies applying for the tax credit will not be evaluated based on whether government officials like their reporting, state officials said.
Zachary Richner, founder of the Empire State Local News Coalition, expressed his hope that the rules for the program will be drafted so that tax breaks will be given priority “to the news organizations that need them most.”
Tom Wiley, publisher of The Buffalo News, said the tax credit will help them invest in front-line journalism.
“We believe the tax credit will help us continue to be the premier source of local news in Western New York State,” Wiley said. “Our work is what ensures we have an informed electorate in an environment filled with misinformation and falsehoods.”
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Associated Press writer Geoff Mulvihill in Cherry Hill, New Jersey, contributed to this report.
Maysoon Khan is a member of the Associated Press/Report for America Statehouse News Initiative, a nonprofit national service program that places journalists in local newsrooms to report on issues that have not previously been covered publicly.
