This is the third in a series of reports on the National Summit on Journalism in Rural America, held June 3-4 by the Institute for Rural Journalism and Community Issues and the College of Communication and Information at the University of Kentucky. Summit sessions can be viewed on YouTube.
A nonprofit business model is an increasingly attractive alternative for newspapers that have seen their profit margins fall into single digits and want to be able to get grants and tax-deductible contributions. The potential of the nonprofit model for rural papers was the topic of a Friday session and a Saturday panel discussion at the National Summit on Journalism in Rural America.
“We see nonprofit local news . . . as a real bright spot,” said Jason Alcorn, vice president of learning and impact at the American Journalism Project, which makes grants to nonprofit news organizations, partners with communities to launch new ones, and coaches their leaders.
Publishers who are interested in the nonprofit model can explore it with the help of the Institute for Nonprofit News, which has more than 400 nonprofit, nonpartisan publishers doing 400,000 stories a year, said Jonathan Kealing, the organization’s chief network officer.
INN publishes a conversion guide, developed with the Salt Lake Tribune, which recently went nonprofit, and a guide for nonprofit startups. It also provides advice for its members.
Alcorn and Kealing appeared with Elizabeth Hansen Shapiro of Columbia University, co-founder of the National Trust for Local News, which aims to keep local news in local hands. Last year, it used philanthropic support to buy a chain of 24 community newspapers and put them in a nonprofit. Now, she says the Trust is asking, “How can we bring rural papers together under common nonprofit ownership to share resources and increase the chances of long-term service and sustainability?”
A fundamental difference between the profit and nonprofit models is that the former is about making money and the latter is about providing public service. “Nonprofits are by law community assets” that can’t be sold, and their boards are charged with acting for the benefit of the community, not the benefit of the organization, Kealing said.
A nonprofit can still make money; it just re-invests profits rather than distributing them to owners. “Nonprofit does not mean non-commercial,” Alcorn noted.
Friday afternoon, summiteers heard about the latest move of a group of newspapers to a nonprofit. Liz and Steve Parker of the New Jersey Hills Media Group said they went nonprofit because their 14 weeklies had been making a small profit but declining ad revenue prevented investments needed for growth, and they didn’t want to sell to any of the chains that were willing to buy it.
“The options for selling we so unattractive,” Steve Parker said. His sister said most of the buyers were “bottom feeders” who would have ruined the papers, so they created the Corporation for New Jersey Local Media, using the model of the Lenfest Institute, which owns the Philadelphia Inquirer: a social benefit corporation (“B corp”) that allows the papers to keep publishing editorials and anything else a paper can do, including events. The CNJLM can also take grants and tax-deductible contributions.
It can also acquire other papers, becoming an umbrella for independently operated news organizations. Amanda Richardson, executive director of the nonprofit, said it has been approached by another paper that may become part of the enterprise.
Liz Parker said the model is sort of like the people of Green Bay, Wis., owning the Packers, but there is no reason that it can’t work “across the country.” Her detailed PowerPoint presentation can be read and downloaded here. Shapiro’s presentation is here.
Further reports on the National Summit on Journalism in Rural America will appear later. Topics will include support from philanthropies and universities, and editorial approaches. Previous articles were on the state of rural journalism and the Summit-driven effort for sustainability in rural journalism.
