In summary

To help save community newspapers, the Legislature must extend an exemption over contract workers in AB 5, or risk losing a vital voice for their constituents.

By David Chavern, Special to CalMatters

David Chavern is president and CEO of News Media Alliance, the news industry’s largest trade organization, david@newsmediaalliance.org.

You’d be hard pressed to find an industry that hasn’t been negatively impacted by the coronavirus pandemic. But when it comes to news publishing, the virus has accelerated some difficult trends, especially for small community publishers. 

And now yet another blow to small newspapers in California is about to be dealt, unless the state Legislature acts soon.

A new report warns that the current health crisis may accelerate the closing of community newspapers across the nation. These outlets are critical to our democracy. When they can no longer afford to continue reporting, communities lose a vital watchdog and government business is hidden from public view. 

Right now, many communities throughout California are suffering the loss of their watchdogs. More than a dozen newspapers have suspended operations in the last five months, with more planning to close in the coming months.

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Last year, the California Legislature passed Assembly Bill 5 for how businesses classify workers as contractors or employees. In recognition of the inapplicability of the legislation to the news industry and the economic headwinds facing community newspapers, the Legislature gave news publishers a one-year exemption, but when the extension ends in December 2020, publishers will be forced to classify newspaper carriers as employees.

This significant change to a business practice that has been in place for more than 100 years will have the effect of increasing the cost of newspaper delivery by as much as 85%, a burden that is unsustainable for small publishers that have also recently been hit with advertising revenue declines of 30% to 50% as a result of the coronavirus crisis. Local publishers have sounded the alarm with California lawmakers, but so far, they have not taken any steps to address the devastating impact this will have on both publishers and readers.

Small community and ethnic newspapers are especially vulnerable to economic fluctuations and catastrophic consequences, like closure. These small publishers are scrambling to stay afloat by cutting coverage, furloughing reporters and eliminating print publication on certain days of the week. 

They are expediting their transition to digital-first publishing and exploring new methods for providing information to their communities as more readers turn to these methods during the crisis. However, cutting print days disenfranchises specific demographic groups, such as senior citizens and other residents who don’t have internet access (6%) or don’t have a reliable internet connection (up to 25% of rural communities). Through losing their local newspaper, these groups are losing their main source of information and their connection to the community. 

Keeping news publishers strong is in the interest not only of the press, but of our greater democracy. When they lack a steady flow of information, communities suffer a slew of ailments, from declining citizen engagement to increased corruption and declining government performance. Fewer people run for office and fewer people vote.

At a time when California’s unemployment rate is alarming, lack of legislative action to extend the exemption for newspaper carriers will cause even more job losses. If publishers are forced to limit circulation areas for financial reasons, they will have to reconfigure carrier routes, reduce home deliveries and cease daily publication, which means thousands of carrier routes will be eliminated.

To save California newspapers, at a minimum, the Legislature must extend the exemption to AB 5, which will provide newspapers with more time to get past COVID-related advertising declines and to adjust their operations to meet changing consumption patterns. In addition, to further aid ethnic and community news publishers, the Legislature should prioritize these outlets for public outreach ads. Not only will this help provide residents with access to key local resources and public health information, it will help these community outlets bridge the financial gap without any additional state funding.

If California’s lawmakers don’t act soon to help community news publishers, they risk losing a vital local voice for their constituents – and themselves.

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