What I wish everyone who cared about local news knew about local news

The audience at a local school board debate in Memphis, Tennessee, hosted by Chalkbeat. Photo: Xzavier Bonds/Chalkbeat. (Read more about the debate.)

Lately, conversations about the future of news have happily expanded. Rather than talking mostly about rebuilding trust, we are now also talking about rebuilding the news itself — especially local news.

After all, it’s hard to make news more trustworthy when it’s disappearing. And, as everyone from journalism scholars to media critics and prognosticators to tech executives seems to understand, local news is both the type of journalism that’s most endangered and the type most likely to build an informed and connected citizenry.

As a local journalist, I am genuinely thrilled by this shift in focus. But I also yearn for an important perspective to be added to the conversation: that of actual people rebuilding local news.

Because proposing new business models and civic missions is relatively easy. Actually creating these things is more challenging and complicated. I know because I’ve done it, growing a news organization from two reporters covering public schools in one city to more than 30 covering education in seven states. (It’s called Chalkbeat. You should check it out!)

As we all work to decide what kind of local news the democracy needs and how to pay for it, here’s what I want everyone to keep in mind.

The local news that matters most

First let’s define what we mean by local news. Are we talking about Harriet the Spy-style coverage of who dumped the remains of their lunch all over the sidewalk last week, or do we mean coverage of your state’s governor’s race?

My suggestion: Focus on the stuff that commercial markets won’t pay for, which also happens to be the most civically important. Then prioritize states and municipalities.

What will markets pay for? Everything that the rest of us readily pay for — questions like, what’s the best restaurant in a 10 square mile radius of my house?, how did my favorite sports team fare last night?, and what concert should I see this weekend? Local newspapers used to cover sports and entertainment well; today, for-profit digital businesses do.

That leaves… a lot more that has been severely cut back or disappeared because there’s no profit in covering it. The endangered list includes news about schools, transportation, elections, health, the environment, courts — and all the other stuff that matters to us as citizens, but which we don’t actually pay for unless legally forced.

Okay, so are we talking statewide trends, or are we talking sidewalk litterers, or both? It all matters, but covering every block is expensive, whereas it doesn’t actually cost all that much to write about larger-scale environmental trends and standout developments — and the impact is big.

CAL Matters, for instance, reported last August on how California’s air pollution legislation will benefit the oil industry. VT Digger reported last year on a chemical factory that was sickening workers and residents in Bennington. And a joint effort between ProPublica and the Texas Tribune correctly predicted the vast devastation wrought by Hurricane Harvey.

Given limited resources, states, cities, and towns are the most important grain size of local coverage for concerned citizens to focus on.

So to recap, when we worry about local news, let’s worry least and last about that mystery litterer — and instead prioritize the basic functioning of public goods and the people who govern us in states, cities, and towns.

A $1 billion problem: What our local news crisis costs

How much does this kind of local news cost? The first and most important resource to think about is reporters: an army of news gatherers whose day in and day out job is to understand, explain, and investigate the law- and policy-making work of states and municipalities — and, importantly, the effects of those laws and policies.

In Detroit, for example, it’s been relatively straightforward for the local press to chronicle shifts that have given parents more school options. But those stories only describe what people in power have decided to do, not how average citizens are affected by the decision. At Chalkbeat, our Detroit bureau chief Erin Einhorn took the time to investigate the consequences of the drift away from neighborhood schools. Over many weeks, Erin interviewed parents, students, teachers, and researchers; reviewed public documents and reports; and even joined multiple families on their commutes to school. Only then did the public — not to mention lawmakers and city and state leaders — find out that many parents and their young children were spending multiple hours every day traveling to school, and not necessarily gaining a better education in exchange for the lost time. In one case, a mother and son took eight buses over six hours every day.

How many Erin-style reporters do we need to cover the critical information needs of every state and municipality? In a seminal 2011 FCC report that should be required reading for anyone who cares about this topic, Steve Waldman estimated the number at roughly 50,000. The last viable count of local newspaper journalists, in 2015, sized the workforce at 33,000, a number that includes all professional newsroom reporters, whether they cover civically important topics or not. The number has surely declined significantly since then — probably to more like 25,000.

I did some napkin math to estimate the total shortfall in dollars, throwing in staff and infrastructure to support reporters, and modestly inflating today’s pitifully low average reporter salary. We’re about $2 billion per year short of the Waldman newsgathering ideal.

And that’s not taking into account the efficiencies that smart new digital-first models of coverage can provide. At Chalkbeat, for example, we pull off strong coverage of public education in a dozen school districts, nearly half a dozen statehouses, and the national trends that cut across those places with annual revenue of $6 million. When we recently compared the costs of our district coverage to that of a legacy print publication, we were astonished to see that the print publication could cut its revenues by a third and still triple its reporting manpower under the Chalkbeat model. And our efficiencies and returns to scale improve every day.

So let’s say, a little more conservatively, that new efficiencies can cut the cost of stabilizing our democracy in half. That leaves us with a roughly $1 billion problem — a lot of money, but also, not that much at all.

So many individual companies make a billion dollars a year in revenue that Forbes doesn’t even count them (they start their lists at $2 billion). For scale: a single Vermont-based provider of frozen dough generates about half of what we need to sustain local newsgathering in America. One billion is even a pittance compared to the total annual advertising revenue that commercial newspapers brought in just 15 years ago — $50 billion.

The emerging “third way” business model

Conventional wisdom goes that news stopped making money because people stopped paying for it. If that were true, the path to recouping our missing $1 billion would be simple: remind people that content isn’t free, and let the subscription dollars roll. Unfortunately, that doesn’t work for two reasons.

First, the local news we’re talking about is a public good; it should be available to everyone, not just to those who can pay for it. Second, and even more damningly: subscriptions never covered the costs of news. They always covered just a fraction — 20% in newspapers’ late-90s heyday — and they always will. Even the much-celebrated increases in newspaper subscription revenue over the last decade amounted to less than the rate of inflation.

If people never paid for local news, then who did? Advertisers. It was a happy coincidence: newspapers provided communities with a service, and they also provided companies with access to the public’s attention, even after the disruptions of radio and television. Only the internet, by creating more targeted and measurable ways of purchasing people’s attention, broke newspapers’ grip on advertising.

So if subscriptions and advertising no longer suffice, how do we find our $1 billion? Once we’ve cast aside market-based solutions, most people have one idea left: the benevolent billionaire. A local person with the means and desire to emulate Jeff Bezos’s mission-driven purchase of The Washington Post.

But billionaires are fickle, as more than one prominent rich-person-dependent local news organization has already learned, and democracy frankly doesn’t need the very richest among us taking any more control than they already have.

Fortunately, between for-profit death spirals and undemocratic billionaire bailouts lies a third path — one that also happens to be the only part of the local news business that is actually growing these days.

The third way is the local news version of the “social enterprise”: a mission-driven organization that deploys all the best business innovations to meet its social purpose.

Social enterprises are almost always nonprofits, organizations that are legally obligated to pursue not wealth but mission — in the local news case, the mission of informing the democracy. They are governed not by a single wealthy owner, but by a board of directors entrusted with safeguarding the organization’s mission, including its editorial independence, the practice of protecting news judgments from the influence of anything but the pursuit of truth. They are, finally, as the buzz word suggests, enterprising, pursuing every available tool to serve audiences effectively and build businesses that last as long as humanly possible.

Social enterprises proliferate in other sectors for which an important public mission just can’t be paid for through traditional capital markets, or, at least initially, through the government.

Take dance companies, which, conveniently, happen to comprise a $1 billion industry. The tickets I buy to see my local ballet make up well under a third of what it actually costs to produce this moving art. The rest of the dance sector’s costs are covered through donations, corporate sponsorships, and creative commercial sources beyond tickets, like intellectual property licenses, educational services, and merchandising.

As someone who has spent more than a decade reporting on “social enterprises” and the “social entrepreneurs” who lead them, I was initially a little embarrassed to realize that I had become the beast I wrote about. But social enterprise is exactly what Chalkbeat is (instead of ballet tickets, we sell tickets to school board debates!), and social entrepreneur is an identity I now embrace as an important extension of what it means to make journalism happen.

It helps that I found a few fellow travelers along the way. In addition to Chalkbeat, there’s ProPublica, Reveal, and the Marshall Project. There is also a small but growing group of social enterprises that focus on local news, as Chalkbeat does. I already mentioned VT Digger and CAL Matters, great news organizations that are motivated by a mission to serve the news needs of their communities and are proving they can build creative business models to do it.

I also mentioned the Texas Tribune, the most famous and arguably most successful in the group. Founded by a group of journalists and a philanthropist and venture capitalist, John Thornton, the Tribune is now a nearly $10 million operation making a big difference for Texans and paid for by an impressively diversified set of revenue streams.

When I met John, the Tribune cofounder, about a year ago, we realized we’d both been entertaining questions from even more people who want to join our merry band of mission-driven local news entrepreneurs. We started calling the organizations they sought to start by a name that has stuck: the Community News Organization, or CNO.

We also realized that we had both independently come up with the same idea for how to ensure the CNO third way grows as fast as democracy needs it to — a project we’ve spent the last year working on, and one that gets me to my final point.

What you can do

I cheer every time a friend shares that she’s subscribed to her local newspaper. But we can do even better than throwing life preservers. We can rebuild the local news in the way our democracy deserves.

The way I’ve personally committed to doing that is by forming, with John, the American Journalism Project, or AJP. Our big goal is to generate, as quickly as possible, the missing $1 billion required to safeguard our democracy with strong and sustainable local news.

We’re doing that through a proven tool for developing and growing social enterprises in other fields: the “venture philanthropy” fund. I know, to a journalist, it sounds kind of awful, like something we should probably investigate. But these things work, catalyzing major investments in public-interest sectors from health to education.

Like for-profit venture capital funds, the philanthropic kind give sizable amounts of money to promising organizations that are poised to fill an important market need. Then, also like a traditional VC, they invest time and support to helping the organizations they fund thrive.

Finally, in a departure from traditional VCs, venture philanthropy funds, by their very existence, play an important evangelizing function for their specialty cause. In local news, by supporting the most promising community news organizations, we can catalyze more support — both philanthropic and commercial — that the CNOs themselves will recruit. We can also create a cool-kids community among the donors who support the fund that more and more people will want to join over time.

The American Journalism Project is, for me and John, a passion project, and a side project. I’m still committed to running Chalkbeat, and John to his day job and his board leadership of the Texas Tribune. Soon, we’ll be recruiting a team to lead this idea going forward. We’ll also announce our founding supporters.

What that means for anyone else who cares about local news: find your side project. Join the board of a CNO. Donate to one. Volunteer your time and expertise to growing the businesses that make democracy possible. And if you want to go above and beyond supporting one CNO, donate to the membership organization that’s leading CNOs forward, the Institute for Nonprofit News.

Today, rebuilding local news is a cause and a dream. Tomorrow, the cause can become a movement, and the dream can become reality. We’ve just got a little work to do along the way.

Elizabeth Green is the CEO, cofounder, and editor-in-chief of Chalkbeat and the cofounder of the American Journalism Project. To donate to Chalkbeat, visit us here. Sign up to learn more about the American Journalism Project here.