Senators Send Bipartisan Letter Urging Support for Local Media Outlets Amidst COVID-19 Pandemic

Today a bipartisan letter was sent from four influential U.S. Senators Maria Cantwell (D-WA), John Kennedy (R-LA), Amy Klobuchar (D-MN), and John Boozman (R-ARK) to their Senate colleagues urging support for expanding U.S. Small Business Administration loan access to struggling local newspapers.

Under the original SBA loan program — the Paycheck Protection Program (PPP) that was part of the Coronavirus Aid, Relief and Economic Security (CARES) Act – newspapers with fewer than 1000 employees were made eligible for forgivable SBA loans to help cover employee salaries, benefits, rent payments and other essential operating costs. While providing welcome relief to some media outlets, the restriction on newspapers that are part of other newspaper groups or non-news business unnecessarily penalizes thousands of local newspapers across the country that operate in hometowns across America. This harmful exclusion would be corrected under the proposal offered by Sens. Cantwell, Kennedy, Klobuchar and Boozman.

As the letter from the four Senators explains, newspapers and broadcasters are facing unprecedented carnage in the local advertising market. At the same time, consumers are flocking to newspapers and local broadcasting for credible and trustworthy news in record numbers.

The Alliance thanks Sens. Cantwell, Kennedy, Klobuchar and Boozman and strongly endorses their legislative initiative.

Here are quotes that can be attributed to both News Media Alliance President & CEO David Chavern and NAB President Gordon Smith:

“During this time of unprecedented uncertainty, reliable local news and information is more important than ever,” said News Media Alliance President and CEO David Chavern. “SBA loans have allowed some local news publishers to keep reporters employed and their newsrooms running as an essential function. But too many publishers have been left out because they are part of groups with other small publishers or non-news businesses. We are requesting changes to the SBA loan program would allow funds to flow to more local newsrooms, and help them to continue doing the work that sustains communities during a time of crisis. We applaud Senators Cantwell, Kennedy, Klobuchar, and Boozman for their leadership in pushing for this measure and we call on Congress to expand the SBA program to cover local news outlets.”

“NAB is grateful to Senators Cantwell, Kennedy, Klobuchar and Boozman for their leadership in supporting expanded access to Small Business Administration loans for local radio and television stations under the Payroll Protection Program,” said NAB President Gordon Smith.  “America’s broadcasters are providing trusted and credible lifesaving coverage to keep citizens safe during the COVID-19 pandemic, yet local stations are suffering advertising losses of historic proportion that will undermine this critically important service. We urge Congressional leaders to support this proposal to provide immediate SBA loan eligibility to more local radio and TV stations.”

United States Senate

For Immediate Release

April 19, 2020

Contact:

Ben Marvin-Vanderryn (Cantwell)

(202) 695-9056

Jess Andrews (Kennedy)

Cantwell, Kennedy, Klobuchar, Boozman Send Bipartisan Letter Urging Support for Local Media Outlets Amidst COVID-19 Pandemic

Letter asks Senate Leadership to make more local newspapers, TV, and radio stations eligible for support under Paycheck Protection Program
Local newspapers have lost as much as 50 percent of ad revenue; some local broadcasters have lost up to 90 percent

WASHINGTON, D.C. – As the Senate considers additional measures to support small businesses around the country struggling with the impacts of the COVID-19 pandemic, U.S. Senators Maria Cantwell (D-WA), John Kennedy (R-LA), Amy Klobuchar (D-MN), and John Boozman (R-AR) sent a letter to Senate leadership urging them to ensure any future legislation make thousands of local newspapers, TV, and radio stations around the country eligible for small business assistance under the Paycheck Protection Program (PPP).

In the letter, the senators called for waiving the Small Business Administration’s (SBA) affiliation rule to allow local media outlets to access funding, pointing to the critical role these outlets play in keeping communities healthy and informed.

“Ensuring that local news outlets remain viable at this critical time is not only a matter of fairness, but is essential to public health,” the senators wrote. “Local newspapers, radio, and television stations provide important local content that keeps their communities informed. People rely on local newspapers and broadcasters to cover school and business closures, to widely communicate public health guidance, and to combat life-threatening misinformation.”

The COVID-19 pandemic has had devastating effects on local media outlets around the country. In the last few months, local newspapers have lost as much as 50 percent of advertising revenue, and the National Association of Broadcasters found that some local broadcasters have reported as much as a 90 percent loss in advertising revenues. Nationwide, advertising losses for local TV and radio broadcasters are estimated to reach at least $3 billion. The crisis has also resulted in an estimated 28,000 news workers being laid off nationwide.

These losses have only increased the financial difficulties many local media outlets have been feeling for years. From 2005 to 2018, newspaper advertising revenue fell from $49 billion to $14 billion, while subscription revenue remained flat. During the same time period, at least 1,800 newspapers went out of business and roughly 28,000 newsroom jobs were lost nationwide.

“Waiving SBA’s affiliation rules for local newspapers and broadcasters and ensuring that financial assistance flows to the local affiliate, not the parent company, would allow these small, local operations to be eligible for much-needed financial relief. Local newspapers and broadcasters have been hit hard by the COVID-19 crisis, are essential for maintaining a well-informed public, and deserve our help,” the senators concluded.

U.S. House Antitrust Subcommittee Chairman David N. Cicilline (D, RI-01) and Representative Jim Sensenbrenner (R, WI-05) are leading a similar effort to support local news outlets in the House of Representatives.

The full text of the letter can be found here and below.

April 18, 2020

Dear Leader McConnell and Leader Schumer:

We urge you to ensure that any future stimulus package makes more local newspapers and radio and television broadcasters eligible for small business assistance under the Paycheck Protection Program (PPP), created by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Up to several thousand newspapers and hundreds of local radio and television stations across the country were cut out of existing programs by the U.S. Small Business Administration’s affiliation rule, which restricts assistance to companies owned or controlled by larger entities. Even though these news outlets may be owned by larger groups, they operate independently.

Ensuring that local news outlets remain viable at this critical time is not only a matter of fairness, but is essential to public health. Local newspapers, radio, and television stations provide important local content that keeps their communities informed. People rely on local newspapers and broadcasters to cover school and business closures, to widely communicate public health guidance, and to combat life-threatening misinformation. The CARES Act waived the affiliation rule for hotels and restaurants allowing them to benefit from small business assistance, and the same consideration should extend to local news outlets in light of their vital role in maintaining public health.

At the same time, local newspapers, radio, and television stations have lost major advertising revenue because of COVID-19’s devastating impact on the American economy. According to the News Media Alliance, newspapers have lost up to 50 percent of advertising revenue for the second quarter of the year. According to a nationwide survey conducted by the Interactive Advertising Bureau, traditional media, including local radio and television stations, will see a 43 percent decline in advertising revenue for March and April. The National Association of Broadcasters has found that some local broadcasters have even reported that up to 90 percent of their advertising revenue has been lost.

Waiving SBA’s affiliation rules for local newspapers and broadcasters and ensuring that financial assistance flows to the local affiliate, not the parent company, would allow these small, local operations to be eligible for much-needed financial relief.

Local newspapers and broadcasters have been hit hard by the COVID-19 crisis, are essential for maintaining a well-informed public, and deserve our help.

Sincerely,

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