How a group of Denver area newspapers were saved from corporate ownership

Photo (cc) 2008 by Alyson Hurt

Just before Thanksgiving last year, Melissa Milios Davis was contacted by Jerry Healey, the co-owner — along with his wife, Ann Healey — of Colorado Community Media, which publishes 24 weekly and monthly newspapers in the Denver suburbs.

The Healeys were approaching retirement and looking to sell, and they were hoping to avoid turning over their life’s work to a corporate chain owner or a hedge fund. Milios Davis, vice president for strategic communications and informed communities at the Gates Family Foundation, serves on the executive committee of the Colorado Media Project, which has been seeking ways forward for local news since 2018.

That encounter, Milios Davis said at a recent webinar (you can watch it here; background information here), led to the sale last month of the Healeys’ newspapers to a new entity whose majority owner will be The Colorado Sun, a startup digital news operation that’s run as a public benefit corporation. That means the 24 papers, like the Sun, will not be organized to enrich its owners; any profits they earn will be rolled back into news coverage and other operations.

“These are still profit-making enterprises. It’s a business,” said Milios Davis, adding it would have been a “huge loss” if the papers had fallen into the wrong hands.

Also speaking at the webinar, organized by the Media Enterprise Design Lab at the University of Colorado Boulder, were Lillian Ruiz, co-founder and managing director of the National Trust for Local News, and Larry Ryckman, editor and co-founder of the Sun. The moderator was Nathan Schneider, an assistant professor of media studies at the university.

According a recent article about the deal by Corey Hutchins of Colorado College, the papers will be owned by the newly formed Colorado News Conservancy, which in turn is co-owned by the National Trust for Local News and the Sun. Hutchins reported that the 40 employees who worked for the Healeys, about half of them journalists, would keep their jobs.

The conservancy is currently seeking a publisher, Ruiz said at the webinar, and has invested a considerable amount of attention in the process. “We didn’t want to create just a replication of who have we had some handshakes with over a highball,” she said.

The Sun itself, which was founded after the meltdown of The Denver Post under the ownership of the hedge fund Alden Global Capital, is continuing to grow, said Ryckman — from a staff of about 10 when I wrote about the Sun for the Nieman Journalism Lab last fall to 15 today, with more on the way. He described the chance to save the community newspapers as something that was too important to pass up.

“At least on the Sun side, this came together pretty quickly,” he said. “This absolutely was a cause that was near and dear to our hearts…. We know who’s first in line when it comes to buying newspapers these days, and no one wants to see that happen.”

What helped jump-start the deal, said Milios Davis, was a study that the Colorado Media Project conducted several years ago in partnership with the Colorado Press Association. Among the findings: the number of journalists covering local news had been cut in half over the previous decade, in line with what was taking place nationally; and that of 151 newspapers they could identify, 93 were still locally owned.

“We saw on the horizon that a lot of these were … older owners” who lacked a succession plan, she said, explaining that there were 44 in that category. “We were looking at this as a tidal wave that would slowly crash on the shores,” which led to conversations about how to help them transition to new local ownership.

And then the Healeys came along.

One of the most important takeaways from what is happening in Colorado is that local news can still be run on a sustainable basis, and that corporate control and the gutting of newsrooms are not inevitable. As I wrote a few weeks ago, I would love to see the Colorado story replicated across the country. Ruiz said the exact model being used in Colorado might be unique to that area. But she added that her organization is looking at what might work in other parts of the country — especially in communities of color.

So how do we wrest control of local news away from chain owners? Report for America co-founder Steven Waldman, who’s been everywhere lately (it also turns out that he’s a co-founder of Ruiz’s organization), wrote an op-ed piece for the Los Angeles Times calling for tax breaks for newspaper owners who sell to nonprofits or public benefit corporations.

That would provide an incentive for the likes of Alden and Gannett to take their money and go home. I would add another incentive: tax penalties to be imposed on for-profit owners of newspaper chains of a certain size that are not owned locally.

Communities deserve a chance to take charge of their news and information. Three years after Alden all but destroyed The Denver Post, we’re starting to see a renaissance fueled by a new media venture and an old one that’s been given new life.

Become a member of Media Nation today.

Show us the money: NYC’s innovative approach to funding local news

New York Mayor Bill de Blasio. Photo (cc) 2010 by Public Advocate Bill de Blasio.

One of the more vexing dilemmas in thinking about ways that the government can help ease the local news crisis is how to maintain independence between the dog and the watchdog.

It’s not easy. Nonprofit status brings with it tax advantages that amount to an indirect benefit. Steven Waldman, the co-founder of Report for America, has proposed a $250 refundable tax credit to pay for local news subscriptions or to donate to nonprofit media outlets. Such approaches, though useful, fall far short of what’s needed.

Become a member of Media Nation for just $5 a month

In New York, Mayor Bill de Blasio has come through with something much more direct and substantial: a vast increase in what the city spends on advertising in community newspapers and websites. As a result of his executive order in May 2019, city agencies must devote 50% of their print and digital ad budgets to such outlets. According to a study of the initiative by CUNY’s Newmark School of Journalism:

In its first year of implementation, the executive order far outperformed its own expectations, delivering 84 percent of the budget, nearly $10 million, to more than 220 outlets serving New Yorkers in every neighborhood in all five boroughs in 36 languages besides English.

Keep in mind that Facebook recently announced that it would set aside just $5 million to help local news organizations across the entire country — only if they would agree to set up shop on Facebook, of course.

In a commentary for The New York Times, Newmark Dean Sarah Bartlett and Julie Sandorf, Charles H. Revson Foundation, president of the Charles H. Revson Foundation, wrote that de Blasio’s program has had a dramatic effect. For instance, Brooklyn’s Haitian Times, which nearly went out of business in 2013, received $73,489 in advertising revenues from the city and was able to continue covering its community during the COVID pandemic. Bartlett and Sandorf add:

The federal government has an advertising budget of $5 billion, so a program like New York City’s could provide an enormous boost to community news organizations at a time when local journalism around the country is in crisis.

A program such as New York’s doesn’t provide the true firewall that would be needed to ensure that news organizations aren’t slanting their coverage in order to keep the money rolling in. City officials could cut back or eliminate spending on media outlets whose coverage has offended them. Community groups that are insulated from politics could be charged with making the spending decisions, but those have their own biases.

Still, give de Blasio credit for finding a way to help local news organizations at a time when viable solutions are few and far between.

Should Report for America send journalists to chain-owned newspapers?

How much support do newspapers owned by cost-cutting corporate chains deserve? It’s a dilemma. On the one hand, the people who live in communities served by those papers need reliable news and information. On the other hand, subsidizing them with money and resources could be considered a reward for bad behavior.

Last week Report for America, or RFA, announced that it would send 225 journalists to news organizations in 46 states and Puerto Rico during 2020-’21. With local news in crisis even before the COVID-19 pandemic, it was a welcome piece of good news. Most of the organizations that will host these young journalists are either independent or part of small chains, and they include a sizable number of public broadcasters, nonprofit start-ups, the Associated Press and the like. Locally, The Bay State Banner will be getting a reporter.

But in looking over the list, I also noticed a substantial number of newspapers that are part of corporate chains. By my count, 15 papers are part of McClatchy, which recently declared bankruptcy after staggering under unsupportable debt for many years. Twelve are part of Gannett, recently merged with GateHouse Media; both chains are notorious for slashing their newsrooms, and not just since COVID-19 reared its head. One reporter is even going to Cleveland.com, the website of The Plain Dealer and the scene of a recent union-busting effort on the part of Advance Publications.

As I said, it’s a dilemma. If you attempt to punish chain owners for squeezing out revenues at the expense of newsroom jobs, you wind up hurting communities.

I contacted Report for America co-founders Steven Waldman, who serves as RFA’s president, and Charles Sennott, who’s the chief executive officer and editor of The GroundTruth Project, of which RFA is a part. Their answers have been lightly edited. First Waldman:

My general answer is: Yes, half of our placements are in nonprofit, and others are in locally owned commercial entities. But we do indeed have some placements in newspapers that are owned by chains. Our primary standard is: Will this help the community? So we have on occasion accepted applications from newspapers with the problems you mentioned if we were convinced that they would use the reporter to better serve their readers. If we can be a positive force in helping those newspapers tip more in the direction of great journalism, we view that as a real positive step…. [Ellipses Waldman’s.] In effect, we’re creating hybrid nonprofit/for-profit models that provide even better local journalismBy the way, we have always had newspapers like that in the program, as part of the mix. That’s not new.

Now Sennott:

One of the stronger papers in our original Report for America class of 2018 was the Lexington Herald-Leader, a McClatchy paper in Kentucky. They pitched us on reopening the Pikeville Bureau in the heart of coal country in Eastern Kentucky, a bureau they had been forced to close 10 years earlier. They felt they were not serving well the community there. We placed RFA corps member Will Wright there and he became one of our true stars, breaking a story on a water crisis in which tens of thousands of residents did not have access to clean drinking water. His reporting turned a spotlight on this issue and helped the community force the county officials to repair the work and restore the access to clean drinking water. I went to Pikeville to work alongside Will Wright on this story and saw his incredible impact in that community with my own eyes. That is what we care about, serving the communities in these under-covered corners of America. And that’s why we have always been proud of our work with the Lexington Herald and why we did not rule out McClatchy as a place for us to look for RFA host newsroom partnerships, even if it is a chain that is going through hard economic times.

We did an enterprise project with Will Wright and two other reporters in rural Appalachia. Here is a link to the project, which was also featured on GroundTruth, as home of RFA:

https://thegroundtruthproject.org/projects/stirring-the-waters/

Also, we got news today of a full-page ad was taken out by Republicans and Democrats thanking McClatchy for its service to Kentucky.

And adding a poetic new chapter to the story, Will Wright has been accepted by The New York Times for its very competitive fellowship. And no, we are not leaving them high and dry. In this new class, we will have three journalists (two reporters and one photographer) at the Lexington Herald.

Sending an RFA journalist to a Gannett paper isn’t going to lead directly to a layoff. More public-accountability coverage is in everyone’s interests. And the chains, unfortunately, have a monopoly in many parts of the country, so it’s not like RFA could send someone to another news organization in that community.

Overall, I think RFA is doing the right thing — even if it makes me a bit queasy.

Talk about this post on Facebook.