U.S. Senator Benjamin L. Cardin (D-MD) introduced legislation that would allow newspapers to become non-profit organizations in an effort to help the faltering industry survive.
In recent months, the Seattle Post-Intelligencer, the Rocky Mountain News, the Baltimore Examiner and the San Francisco Chronicle, among others, have either ceased daily publication or announced that they may have to stop publishing. A number of other publications, including newspapers owned by the Tribune Company, owners of The Baltimore Sun, have filed for bankruptcy or have had to institute severe cutbacks that have impacted news coverage.
The Newspaper Revitalization Act would allow newspapers to operate as non-profits, if they choose, under 501(c)(3) status for educational purposes, similar to public broadcasting. Under this arrangement, newspapers would not be allowed to make political endorsements, but would be allowed to freely report on all issues, including political campaigns. Advertising and subscription revenue would be tax exempt and contributions to support coverage or operations could be tax deductible.
The measure is targeted to preserve local newspapers serving communities and not large newspaper conglomerates. Because newspaper profits have been falling in recent years, no substantial loss of federal revenue is expected.
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