Supporting a newspaper could keep your taxes down

Posted 11/3/20

There are many aspects to the value of a community having a local newspaper serving its community. The financial health of these newspapers has been challenged in recent years with the loss of local …

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Supporting a newspaper could keep your taxes down

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There are many aspects to the value of a community having a local newspaper serving its community.

The financial health of these newspapers has been challenged in recent years with the loss of local retail advertising, the transition to digital news delivery, negative effects of recent newsprint tariffs, the announcement of huge newspaper postage increases (50%-plus) over the next five years, and the recent negative impact of COVID-19 on many community businesses which advertise in local papers.

One of the main things a newspaper does is represent the public in keeping a local open government.

It does this by receiving information about activities/ actions occurring at local government meetings, gathering information from open government records and publishing government notices.

These three things are the foundation for open government and without any one of them, “openness” is compromised.

The loss of all of those things can be devastating and often occurs when a newspaper closes. Up to this point in time, there has been no effective replacement of a community newspaper in print or online.

One of the impacts of losing a newspaper is an increase in the operational costs of local governments. I am going to reference one study on local governments following newspaper closures to illustrate the financial impact alone of such a loss, “Financing Dies in Darkness? The Impact of Newspaper Closures on Public Finance,” by Pengjie Gao, University of Notre Dame; Change Lee and Dermot Murphy, University of Illinois at Chicago, February 12, 2019.

This particular study looked at increased costs to municipalities for borrowing bonds after a newspaper closure. This study looked at actual data from municipalities from across the United States over a period of several years where newspapers were closed.

The study examined the actual cost increase in a municipality during the three years after a newspaper closed. According to the study, “our main finding is that newspaper closures have a significantly adverse impact on municipal borrowing costs in the long run.”

Why does the public pay more when a newspaper closes? Simple. According to the study, first, “the increased government inefficiencies that result from the loss of a government watchdog,” and second, “increased informational frictions that result from lack of press coverage,” thus lenders charge more.

The study further found that “the number of government employees increased by approximately four per 1,000 residents, tax revenue per capita increased by $85, and the deficit per capita increased by about $53.”

Wow. This means taxes increased $340 per year for a household of four people. It is not theoretically what could happen. This is what actually has happened. In perspective, a $50 annual subscription to a community newspaper is an incredible value.

Perhaps informed citizens can prevent further newspaper closures. Community newspapers are different from any other local business. No other business has the rights of the citizens tied to it as community newspapers do. The “press” is the only private business mentioned in the Constitution, so our founding fathers must have thought it was important.

The purpose of this column is to make sure the public knows the value of a newspaper. I feel an ethical obligation to write this column and could only do it when I was no longer an active publisher, because of conflicting interests of owning a business and serving the community.

Actually, there was not much conflict because newspapers in recent years are not businesses that make much money; nevertheless, they are private businesses. It is important that the people in this community are clearly informed on the value of having a community newspaper and the consequences for all citizens if it closes.

What can you do? First and foremost, subscribe to the paper, give gift subscriptions, or ask your employer to offer subscriptions to the local paper as a benefit. Encourage your family and friends to subscribe.

It is much less expensive to subscribe than not.

Second, patronize businesses which currently advertise in a local paper and encourage other businesses you patronize to advertise in the paper.

Third, support the paper by what you say in words and post on social media.

Fourth, consider making a tax-deductible contribution to the paper specifically to employ professional journalists. Perhaps there will be a day when surviving newspapers will have a similar model structure to public television stations.

Finally, engage with the people who run your local newspaper. Let them know you do care and want to see them succeed. Citizens who are lucky enough to still have newspapers in their communities should do whatever they can to keep the papers, because if they close, the publications statistically will not return and it will cost every business and citizen more money — a lot more money each and every year into the future until something is developed to effectively replace the community newspaper … if that ever happens.