California’s Community News Act could bring more money to local newsrooms. Gov. Newsom has until today to sign it into law. If passed, California would become the fourth state to introduce a credit system to support local newsrooms.
The bill would create refundable tax credits for local California newsrooms based on the number of journalists employed or retained.
Newsrooms and reporters would have to meet eligibility criteria to qualify.
“Local journalism is under attack from every direction. Newsrooms across California are shrinking, reporters are being laid off, community newspapers are closing and local voices are disappearing,” said State Assemblymember Chris Ward, the bill’s co-author, in a hearing.
A refundable tax credit is “a credit you can get as a refund even if you don’t owe any tax,” according to the IRS. In this instance, it would be similar to a grant.
In order to qualify for this tax credit, different outlets must meet these requirements:
- Digital news outlets must publish statewide or local news at least monthly and prove 33% of its audience are California residents
- Broadcast stations must be a public broadcaster and be FCC-licensed
- Print publications must prove at least 33% of its paper distribution is within the state and be court-certified
For journalists to qualify, they must meet the following criteria:
- Work at least 30 hours a week while earning at least $35,000 annually
- Be a California resident
- Conduct the duties of a reporter, including but not limited to reporting, writing, photographing, editing and producing.
More than 180 state and national media outlets are in favor of the bill, including the non-profit newsroom CalMatters.
“We generally don’t take a position on bills, we’re a nonprofit news organization, we are here to cover stuff and explain it to people,” said Neil Chase, CEO of CalMatters, in an interview with Mustang News. “But it would be preposterous to say we don’t have a position on a bill like this.”
The number of journalists in the workforce has declined since 2002, according to a study conducted by Muck Rack and Rebuild Local News.
“Journalism is a public good. It’s essential for a strong democracy and creating a policy to help support it,” Chase said. “That seems perfectly reasonable.”
If passed, starting in 2027 outlets could receive $20,000 in credit for hiring five full-time journalists. They can receive $15,000 for any additional full-time reporters and $7,500 for part-time journalists.
Governor Newsom has until Sep. 30th to pass or veto the bill.