CA News Funding Agreement Falls Short

When I started the Alameda Post , I knew it wasn’t the best time to start a news publication here in town. As with so many other communities, Alameda news coverage had been dwindling since before COVID-19. This was a result of many factors, including the rise of social media, corresponding decrease in advertising revenue, and skyrocketing printing costs for print media. Newspapers across the state have gone under, like the Alameda Sun , or have been purchased by hedge funds that prioritize profit over journalism, like the Alameda Journal .

After learning about the nonprofit news model , I thought it might have a chance to succeed here in Alameda. We are an engaged and generous community that cares deeply about our neighbors and local issues. And since the Post launched, we have been doing well with local fundraising and grants that support our operations. We are closer to being sustainable than ever before and we continue to do everything we can to ensure that we will be a lasting service to Alameda.

Yet we still have gaps in our budget that are going unfunded. As you may be aware, I had been working to try and shape legislation to provide funding and support for beleaguered local newsrooms throughout the state. Two different bills were proposed on the issue by California legislators. First, AB 886 , also known as the California Journalism Preservation Act (CJPA), proposed by Assemblymember Buffy Wicks, would have required tech platforms to provide compensation based on link clicks or impressions. Later modifications changed compensation to be based on headcount.

Then came SB 1327 , a substantially better proposal from State Senator Steve Glazer. Instead of a link tax, Glazer proposed a tax on advertising revenue originating in California. It would be paid out to news organizations based on tax credits, with funding set aside for nonprofits. It could have generated a half billion dollars per year for local California news.

Support for local news was recently worked out in Canada , but after the legislation like CJPA was passed, Google and Meta stopped publishing and linking to news content on all their Canadian platforms. (Google also “test-drove” this draconian solution in California.) In response, the Canadian government came to a deal with Google that would provide about $73 million (US) per year to support Canadian newsrooms, based on headcount. Meta platforms (like Facebook) were not involved in the settlement and continue to block Canadian news.

On August 21, legislators announced an agreement made behind closed doors to create a “News Transformation Fund” with contributions from Google and the state of California to be administered by UC Berkeley, which is a small first step towards that goal. Unfortunately, it is far less than I and many others had been working and hoping for and seems to cater to Google’s wishes over the needs of local news.

The best part of the deal is the commitment to provide some funding for local newsrooms over the next five years, based on headcount, not links or impressions. It looks like it will work out to about $7K to $10K per full-time employee or equivalent. Also, this deal will (probably) not cause Google to block traffic to California news sites.

But there are so many negatives . The plan is not especially transparent. The deal was finalized without much input from news organizations or previous stakeholders. A large portion of the funding is carved out for something nebulously called a “ national AI accelerator ” whose relationship to news is unclear. Plans for the governance board at the University of California do not include any nonprofit news representatives, and there are better choices than the UC system to administer this fund. The method for funding nonprofit news organizations remains unclear. The deal leaves out startups and does little to support the smallest newsrooms. The amount and duration of funding are far less than were proposed by AB 886 or SB 1327, which are now dead in the water, and far less than was agreed to in Canada . Other tech companies, such as Meta, are not involved in this deal. The governor will have to approve the funding each year, as well.

I could go on, but there are a lot of processes yet to be specified and details to be worked out. It’s definitely an important first step—the first of its kind—and will provide some useful funding for the Post . But I am left feeling like I got a pair of roller skates to strap onto my sneakers instead of the 10-speed bicycle I was promised for my birthday.

Adam Gillitt is the Publisher of the Alameda Post . Reach him at publisher@alamedapost.com . His writing is collected at AlamedaPost.com/Adam-Gillitt .

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