Editorial: California bill reaffirms why nonprofit local news matters

National news saturates the airwaves on a daily basis and oftentimes people tune out — but when it comes to local news people want more.

Residents yearn to know what’s happening in their backyard. They want to know which city councilmembers voted for a multistory housing development in the middle of a single-family neighborhood? Why isn’t a mayor pushing harder to save a historic farmhouse? What caused the local school district to close three schools or what happened to their favorite burger joint? In many parts of the U.S., obtaining this knowledge is bleak, if at all.

Over the last 20 years more than 3,500 local newspapers have closed or merged nationwide. This equates to about 40% of all local newspapers vanishing, according to a report by Northwestern University’s Medill journalism school. It also translates to more than 50 million people living where local news is either severely limited or gone.

Locally, the erosion started when the Silicon Valley Community Newspapers (SVCN), a mainstay covering a mix of eight cities and communities — five South Bay cities and three San Jose neighborhoods — was sold in 2005 to the Mercury News. A few years later the original product was absorbed and dissolved by the Bay Area News Group.

SVCN was just the tip of the iceberg. That year turned out to be the beginning of the end for one-third of all newspapers in California over the following decades — a trend that swept across the U.S.

Every local paper that vanished meant another missing link to holding power to account. Political transparency, civic engagement and the challenges that existed in marginalized communities were lost.

Then out of the ashes a new idea birthed — nonprofit local journalism, beholden to no one. Not to hedge funds, private equity firms or moguls who wanted a new toy. It was independent news and frankly many thought it would fail, since survival meant donors, grants and philanthropy to fed the concept.

Communities started to embrace these media upstarts, as each story plugged a hole. Suddenly reporters in these nonprofit newsrooms were pointing out political shenanigans, reporting on the lack of government transparency, the education and wage disparities in marginalized neighborhoods and small businesses battling with local officials for operating permits.

Local newsrooms were back. The nonprofit model surged and suddenly it was more than just a concept. Reporters were uncovering the truth and affecting change at the grassroots level.

Now, Gov. Gavin Newsom has signed Assembly Bill 2222 that will give millions of dollars to newsrooms over the next five years. For small nonprofits newsrooms, and other news outlets that are struggling, he threw a life preserver into those inky deep waters.

He signed the Community Newsroom Employment and Workforce Sustainability Act on Sept. 30, which will help newsrooms hire more journalists by creating refundable tax credits. It will help uplift local news outlets that are teetering and strengthen those like San José Spotlight that have become sustainable.

The goal is simple: create a tax credit to incentivize newsrooms to be able to hire and retain journalists.

News outlets that qualify will receive a $20,000 tax credit per full-time journalists up to five, a $15,000 credit for each full-time journalists in excess of five, and a $7,500 credit for each journalist employed on a part-time basis. The bill also allows a credit of $15,000 for each full-time journalist hired for a new journalism position.

The bill is effective after Jan. 1, 2027 and expires Jan. 1, 2032. That five-year window should help prop up local news, encourage growth and strengthen a sector of industry where residents overwhelmingly say local new matters.

It enables reporters to dig deep into their beats, which in turn keeps residents abreast of what is happening at City Hall before decisions are made. This sparks civic engagement because a robust newsroom can inspire local action. It will also uplift and encourage marginalized voices to speak out because local news is telling their stories.

Newsom’s action reaffirms that unbiased, fact-based nonprofit local news is a cornerstone of democracy, and needed now for than ever. His signature acknowledges the value and strengthen its purpose.

Moryt Milo is an editor at San José Spotlight. Contact Moryt at [email protected] or follow her at @morytmilo on X.