Rebuild Local News joins local publishers, small businesses in supporting local media advertising tax credit in Maryland
The bill provides up to $3,000 in tax credits over five years to local businesses who advertise in local news outlets.
A Maryland bill that would create a refundable tax credit for local businesses to advertise in local news outlets had its first hearing before the House Ways and Means Committee on Feb. 16.
Delegate Joe Vogel (D-Montgomery County) is the lead sponsor with six other delegates joining as co-sponsors. He said he introduced the bill after hearing several constituents express concern over the decline of local news during his campaign. The bill is modeled after the advertising provision in the federal Local Journalism Sustainability Act and would offer small businesses who advertise in local print and digital news outlets $1,000 in the first year and $500 in the following four years. The bill would sunset after five years.
“Right now local journalists are holding us accountable and they are holding leaders across the state accountable as well,” Rep. Vogel said during the hearing. “What we’ve seen here though in the state house and in city halls across the state is a decline of reporters covering these stories.”
Rebuild Local News Policy Director Anna Brugmann, NewsGuild President Jon Schleuss, Sarah Price from the Maryland Retailers Association and Rebecca Snyder from the Maryland-Delaware-DC Press Association Press all testified in favor of the bill during the hearing.
Price said the Retailers Association “strongly supports” the bill, saying not only it would support businesses that are still recovering from the pandemic, but support new small businesses for whom a tax break on advertising could be a critical resource.
Rep. Vogel finished his comments by reinforcing the urgency of the policies that support the local press. Right now, two newspapers are closing per week on average.
“Right now we have an opportunity and this window of time to support the existing local news sources, allowing them to continue doing the critical work they do for our democracy.”
February 14, 2023
Statement of Anna Brugmann, director of policy of Rebuild Local News
The Rebuild Local News Coalition strongly supports H.B. 0540. The bill, inspired by the national Local Journalism Sustainability Act, would preserve news outlets’ editorial independence while offering a critical lifeline between small businesses and local news outlets.
Since 2000, there has been an 81% drop in newspaper advertising revenue. This disruption has resulted in the loss of journalism jobs and democratically vital news outlets across the country. Nationally, there has been an almost 60% decrease in the number of newspaper newsroom workers since 2004. More than 2,000 newspapers have closed since 2004. About 100 closed during the early years of the pandemic alone and the decline is likely to continue at a pace of two per week according to Penny Abernathy of Northwestern University, one of the leading experts on the decline of local news. In addition to closures, widespread consolidation by hedge funds and chains has characterized newspapers for the last decade.
Maryland has seen the effects of this contraction first hand. Alden Global Capital purchased Tribune Publishing and the Baltimore Sun along with it, despite a bid for the Sun from Maryland businessman Stewart Bainum. But, Maryland has also seen the innovation this crisis has inspired.
The Baltimore Banner launched in 2022. The Bowie Sun, a hyperlocal website serving the city of Bowie, launched in 2021. Legacy publications, like AFRO News, have innovated their business model in their journalism, leveraging philanthropic funds to cover the Black business community in Baltimore and creating new products to reach young audiences.
This innovation is critical for Maryland communities. Communities without local news have less civic engagement, lower voter turnouts, more waste, more corruption and even higher pollution without watchdogs to monitor the industries in their own backyards. Towns with less local news even have lower bond ratings and higher taxes. Polarization and misinformation grows.
This policy would give legacy publications and new entrants a tool to both retain advertisers and attract new ones, building important relationships with the business community. In a case study Rebuild Local News produced about how the advertising tax credit in the federal Local Journalism Sustainability Act would have affected AFRO News, AFRO Executive Director Lenora Howze said “with this incentive, she could see herself developing new relationships, creating new lines of advertising revenue on top of the AFRO’s loyal advertisers.”
We thank Delegates Vogel, Foley, Fair, Grossman, D. Jones, Lehman, and Wells for introducing this bill. It appropriately incentives community investment in an essential public good. When workers at the Capital Gazette unionized along with their colleagues at the Carroll County Times and Baltimore Sun, they wrote:
Local journalism is unique. We are your neighbors, the eyes and ears of your communities. We report on what matters most to you every day: the crime down the block, the local football team, your child’s school. Whether the sun shines or disaster strikes, we are right there with you. As local news outlets dwindle, we know now more than ever that quality community news is a gift too precious to lose.
This bill is an important first step in securing the future of Maryland local news for years to come, supporting workers, news publishers and the communities they serve.
The Rebuild Local News Coalition urges you to pass House Bill 540.
The Rebuild Local News Coalition includes:
The National Newspaper Association, Institute for Nonprofit News, National Newspaper Publishers Association, The NewsGuild-CWA, Local Independent Online News, National Association of Hispanic Publications, National Federation of Community Broadcasters, Association of Alternative Newsmedia, Report for America / The GroundTruth Project, American Journalism Project, The Lenfest Institute for Journalism, Solutions Journalism Network, Local Media Consortium, Chalkbeat, PEN America, Institute for Rural Journalism, Wisconsin Newspaper Association, Kansas Press Association, Arizona Press Association, New York News Publishers Association, Maryland-Delaware-DC Press Association, Mississippi Press Association, West Virginia Press Association, Colorado Press Association, Maine Press Association, Wyoming Press Association, Black Voice News, Afro-American Newspapers, Ohio Center for Journalism, The Tucson Sentinel, and The Record-Journal.