Newspapers eye nonprofit model

[Editor’s note: A longer version of this article appeared in The Cohen Report, a publication of The Nonprofit Quarterly.]

Rick Cohen

In March, Democratic U.S. Sen. Ben Cardin of Maryland introduced the Newspaper Revitalization Act, which would allow daily newspapers under certain circumstances to become federally tax-exempt 501(c)3 nonprofits.

Perhaps he was concerned by floundering newspapers in Baltimore — the Examiner, which has gone under and the Sun whose parent company, the Tribune Corporation, has filed for bankruptcy protection.

Is the nonprofit sector going to be the salvation of the U.S. newspaper industry?

Is it possible that tomorrow’s Charles Foster Kane will find himself running a public charity and asking foundations for grants and loans?

Will local nonprofits soon find themselves competing with entities named Times, Post, and Daily News for foundation largesse?

Nonprofit ownership of news outlets is not new, though it is rare in the high-powered world of U.S. mass media.

For many years, the St. Petersburg Times — and the national magazines Congressional Quarterly and Governing — have been owned by a for-profit publishing company, but all of the earnings of the company, after taxes, go to support the nonprofit Poynter Institute.

In essence, the nonprofit Poynter owns those for-profit newspapers and magazines.

In July, the Times Publishing Company sold Congressional Quarterly to the for-profit political journal, Roll Call, owned by the Economist Group, though still retaining Florida Trend, several community weeklies, and the Times.

Similarly, the Christian Science Monitor is owned and published by the Christian Science church, formally known First Church of Christ, Scientist in Boston, Massachusetts.

However, despite 100 years of Church support, the Monitor has had its own difficulties, recently dropping its daily print edition in favor of just a weekend-only print edition plus a daily online paper.

There are already increasing examples of nonprofit-run and-financed news outlets filling in some of the gaps of declining coverage by mainstream newspapers, though most are tiny and local, operating in towns like Chicago, Minneapolis, San Diego and St. Louis.

And several nonprofit news sites are specifically dedicated to investigative journalism, focusing on government or business, rather than local or national news coverage.

Is the nonprofit approach an avenue for saving the future of newspapers?

Will the Cardin/Maloney legislation achieve anything worthwhile toward bolstering the nonprofit option for U.S. newspapers?

Next: Will the future of the press be nonprofit? Sort-of nonprofit? Neither?

Rick Cohen is national correspondent for The Nonprofit Quarterly and a regular contributor to Philanthropy Journal.

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