Lawmakers consider tax breaks for news publishers, state-funded journalism scholarships

Capitol News Illinois
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SPRINGFIELD — A new measure being debated in the Illinois General Assembly would create a tax credit for certain news publishers based on the number of journalists they employ.

The proposal from Sen. Steve Stadelman, a Rockford Democrat, is part of a package of policies he has been pushing to pass since early this year — even as some worry about potential conflicts that could arise from creating new financial relations between the government and journalists. which covers it.

Under Stadelman’s proposal, contained in Senate Bill 3953, the state would offer a tax credit of up to $25,000 for each journalist employed by a media company and up to $30,000 for journalists hired in newly created positions. The credit would only be available to “independent” media outlets, making subsidiaries of larger or publicly traded companies ineligible for the credit.

Advocates say it’s a way to support an industry facing existential financial and logistical challenges. In 2022, the General Assembly created a working group research the state of journalism in Illinois. Their report included a study from Northwestern University’s Medill School of Journalism that showed a third of local media outlets had closed since 2005, leading to an 86 percent decline in newspaper jobs during that period.

The likelihood of the bill passing this spring is uncertain, as lawmakers face the final sprint to the end of the session. The bill was heard at a hearing on the subject, so no vote took place, but it could be introduced as an amendment to a larger bill – a maneuver that lawmakers often employ to l approach their May adjournment.

Stadelman said Thursday he hopes to include the tax credit in the General Assembly’s broader budget.

The proposal for greater state involvement in the media industry has worried some of those working in both fields.

Dan Haley, a self-described “old newspaper guy” and longtime publisher of several community newspapers in Chicago’s western suburbs, said he was initially surprised by the idea. Despite this, he supported the field on Wednesday evening.

“I believe local news needs an investment from state government if we are to fulfill our end of the American market – reporting fairly, with some context, some empathy and some courage , about what’s happening in our cities,” Haley told lawmakers.

On the state side, some share the concern that the government and the media are becoming too closely linked. Sen. Rob Martwick, Democrat of Chicago, who said he sees the value of a “robust, independent Fourth Estate,” questioned whether subsidizing the industry would weaken that independence.

“What happens when we give tax credits to publications that report news and publish opinions? Martwick asked during Wednesday’s committee hearing. “We give it, we can take it back. What if we don’t like the opinions published by certain newspapers?

Stadelman countered that the state was providing “fundamental tax relief,” adding, “we’re not telling them what to report.”

Many media outlets currently receive federal funding through the Corporation for Public Broadcasting, including NPR, PBS, and the many stations affiliated with the two media giants – but this typically represents only a small portion of these groups’ budgets.

At the state level, the Illinois Arts Council, a state agency, regularly awards grants to public broadcast stations like WSIU, WILL, WTTW and others – but they must meet Corporation for Public standards Broadcasting to be eligible. Earlier this year, Stadelman donation proposal the Council $5 million specifically for public broadcasters.

A separate measure, also proposed by Stadelman, would direct funding toward future journalists by creating a state-sponsored scholarship program and require certain disclosures if local media outlets are sold, in an effort to maintain media ownership at local level.

Senate Bill 3592 would allow the Illinois Student Aid Commission to award scholarships to journalism students who plan to work in Illinois for at least two years after graduation. The measure would be subject to appropriations, meaning that if passed, funding would have to be provided in the state budget for it to take effect.

The measure would also require a news publisher, if purchased, to disclose details of the sale to its employees, the Department of Commerce and Economic Opportunity, its county government and any nonprofit organization in Illinois “buying local news agencies.” 120 days notice of potential sale.

Learn more: Expert panel suggests legislative measures to reverse journalism’s decline

The state’s Journalism Task Force specifically highlighted the Southern Illinoisan newspaper’s experience. After Lee Enterprises sold the newspaper to Paxton Media Group in 2023, PMG laid off the newspaper’s unionized staff.

The House Labor and Commerce Committee advanced the measure after adding an amendment that would launch the scholarship program in 2025-2026 instead of 2024-2025. Although there was no debate, the bill passed along party lines 19-10.

Because it has been amended since its initial passage by the Senate, it still must be approved by both chambers before it can be submitted to the governor for signature.

Earlier this year, Stadelman introduced Senate Bill 3591, which would require large online platforms to share their advertising revenue with media outlets whose work is hosted on those platforms.

Stadelman said Thursday that he views the proposal as “more of a long-term play,” although he hopes to eventually move it through committee before the end of this legislative session.

Editor’s note: Two members of the Local Journalism Task Force – Sam Fisher and Jason Piscia – are also members of the Illinois Press Foundation board of directors. The Press Foundation operates and provides funding to Capitol News Illinois.

Capitol News Illinois is a nonpartisan, nonprofit news service covering state government. It is distributed to hundreds of print and broadcast media outlets across the state. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation, with major contributions from the Illinois Broadcasters Foundation and the Southern Illinois Editorial Association.