“Fill the Gaps.” A Donor-Backed Outfit Aims to Reverse the Decline in Statehouse Reporting
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North Carolina State Capitol. Sean Pavone/shutterstock
One of the more alarming consequences of the demise of local news is the precipitous drop in statehouse reporting. A Pew Research Center study found that between 2003 and 2014, the number of newspaper reporters covering state government dropped by 35%.
“The state government is the level of government that has the most effect on people and the least support,” said Chris Fitzsimon, director and publisher of States Newsroom, in a recent interview. His organization is working to remedy this disparity by establishing a network of 18 outlets dedicated to statehouse reporting.
It’s a welcome bright spot in a journalism sector that was on shaky ground even before the pandemic struck—Pew also found that newsroom employment at U.S. papers dropped by about half over the past 10 years, a decline that’s been offset somewhat by new digital outlets. While States Newsroom’s main offices are in Washington, D.C., and Chapel Hill, North Carolina, it employs more than 70 full-time editors, reporters and support staff in cities like Phoenix, Lansing and Harrisburg.
Most of States Newsroom’s funding was in place before the pandemic hit. Like many other local outlets, the network’s sites have seen record-breaking traffic, as readers need to know about the status of local schools, moratoriums on evictions and utility bills, and whether universities will reconvene in person.
People need and appreciate coverage of local and state officials “more than ever,” Fitzsimon said, and the crisis has “given us a unique opportunity to prove ourselves. In some ways, funding has increased, and we’re confident our support will continue.” Its newest outlet, the Kansas Reflector, went live in mid-July. By end of the year, States Newsroom will launch outlets in Missouri and Montana.
Filling Gaps in Statehouse Reporting
Fitzsimon was a longtime reporter in North Carolina, where, in 2004, he started NC Policy Watch, a nonprofit news and commentary outlet focused on the state’s residents. Fitzsimon told me he created NC Policy Watch to “fill the gaps in the statehouse reporting corps.” After about 14 years, some of the outlet’s funders floated the idea of expanding the model to other state capitals. In late 2017, Fitzsimon left NC Policy Watch and what eventually became States Newsroom was born.
Under States Newsroom’s decentralized model, its main offices provide digital, operations and HR support. Each newsroom is led by a veteran local journalist who, pre-pandemic, lived or commuted into the city they covered.
Fitzsimon made it clear that States Newsroom isn’t out to displace existing statehouse reporting outlets. Rather, his organization gravitates to capitols where there is the most need. “We spend time talking to folks in the state who are connected to the media and policy world and identify journalists and talent, and what ‘lane’ is there.” Once leadership determines “what’s missing,” the organization’s primary goal is to find an experienced editor to generate daily reporting and “assemble a team with our help and support. States Newsroom also makes its content free for other publications, and many non-affiliated outlets frequently shared stories over the past six months.
One problem facing its outlets, Fitzsimon told me, is that many Americans still lack consistent broadband access. According to a 2018 Federal Communications Commissions study, 25 million Americans lack fast and reliable access; 14 million have no internet access whatsoever. He said the state and federal governments need to prioritize this issue so citizens can have fast and reliable access to information during the pandemic.
“Dark Money” Concerns
There’s substantial interest in philanthropy as a solution to the local journalism crisis, but, as in many corners of philanthropy, there’s also trepidation about the intentions and influence of donors involved. In the case of States Newsroom, the organization has had to address concerns about the nonprofit that incubated the project, the Hopewell Fund.
States Newsroom became an independent 503(c)(3) nonprofit last November, but prior to that, the project was housed at Hopewell, a D.C.-based public charity that makes grants and incubates and fiscally sponsors projects, moving funds from donors to established and nascent initiatives. Based on grants logged by Foundation Center, the Susan Thompson Buffett Foundation is the fund’s largest institutional supporter, but a long list of prominent funders has supported work via Hopewell, including the Knight, Hewlett, Packard, Moore, Ford and Sloan foundations. Tax filings show causes supported through Hopewell cover women’s health, reproductive rights and abortion, climate change, human rights, economic development, animal welfare and computer science, among others.
Hopewell is required to follow standard IRS rules concerning what a charity can and can’t support, but is not required to name its donors—only the donation amounts—in its annual Form 990 filings. Only foundations have to disclose donations to Hopewell in their own filings. As a result, Hopewell has faced attacks from conservative media as a conduit for “dark money,” because it allows donors to move money to liberal causes without identifying themselves. NewsGuard, a bipartisan journalism watchdog (Knight is an investor), called the Hopewell Fund a dark money group, as well, based on the fact that it has made grants to progressive advocacy groups, and gave almost $5 million in 2017 to Priorities USA Foundation, the 501(c)(3) arm of a progressive PAC.
“Dark money” accusations often imply shadowy donors giving money to influence elections. To be clear, here we’re talking about charitable funds that can’t go toward political activity, though Hopewell does have a sister 501(c)(4) fund, the Sixteen Thirty Fund. (See our profile of Arabella Advisors, which manages Hopewell Fund and the Sixteen Thirty Fund, and faces similar criticisms.) It’s also important to note that more explicitly ideological entities on the right such as DonorsTrust have taken advantage of similar arrangements to anonymize giving for many years.
In a recent article for Nieman Journalism Lab that catalogued partisan media outlets posing as local news—the vast majority of which are right-leaning—media scholars Jessica Mahone and Philip Napoli concluded that States Newsroom does not fall into this category. The organization’s sites “cannot be accurately described as hyperpartisan sites… masquerading as local news,” they wrote, noting that the organization boasts a formidable roster of accomplished journalists, and many of its affiliates’ reporters have lived or worked in the cities they cover for years.
How It Came Together
The controversy and confusion stems in part from the fact that it is not clear which Hopewell donors—who don’t all share the same agenda—are earmarking funds for which Hopewell recipients. Indeed, we don’t know who funded States Newsroom’s work when it was housed at Hopewell, and Fitzsimon did not disclose who those early donors were. Hopewell is also not mentioned on the States Newsroom website.
I asked Fitzsimon to comment on the Hopewell Fund’s role in the organization’s creation. “From the end of 2017 to October 2019, States Newsroom was incubated at Hopewell Fund. They played an invaluable role performing administrative and business functions, like HR and compliance,” he said. “While States Newsroom was housed at Hopewell, we raised our own funds and Hopewell was never a ‘donor’ to our project.” In May, Jim Small of affiliate the Arizona Mirror made a spirited, similar defense of the network, maintaining that they raise their own funds and have since split off entirely from Hopewell.
Fitzsimon told me that some funds raised while they were at Hopewell were rolled over to the new nonprofit during the transition. “These funds amounted to several weeks of operating expenses.”
As an independent entity, States Newsroom now lists on its website all donors who have contributed more than $500 since it launched the nonprofit in 2019. Donors listed include the Ann Arbor Area Community Foundation, Google and the Wyss Foundation, but mostly individuals, along with 2,100 donations under $500 not listed. It will continue to disclose all donors over this amount on its site.
States Newsroom doesn’t run ads or accept underwriting or corporate donations, and its ethics policy prohibits funders from having editorial input over outlets’ coverage. Local outlets also rely on local press associations and foundations looking to increase coverage on issues like the environment. “We are 100% funded by readers and philanthropists,” Fitzsimon said.
“One of the Essential Building Blocks”
States Newsroom’s momentum comes at a time when other organizations have stepped up efforts to boost statehouse reporting. Last November, ProPublica and the Texas Tribune announced plans to launch a jointly operated, 11-person investigative reporting unit service Texas. The outfit will invest more than $1.6 million a year into “critical accountability and watchdog journalism” in the state. The hope is that ProPublica can export this partnership model to other corners of the country.
Around the same time, the Associated Press and Report For America announced a plan to create 14 new reporting positions to cover state government. And earlier this year, the Illinois Press Foundation launched Capital News Illinois, a project launched with the aim of providing nonpartisan statehouse news. Four months later, nearly 300 papers around Illinois reprinted its content.
Ultimately, the pandemic has incentivized citizens to demand accountability from their elected officials, Fitzsimon told me. People “want to know what the state governments are doing.” Unfortunately, further consolidation across the industry is making local outlets’ jobs increasingly difficult. “Our biggest concern about statehouse coverage is how hedge funds and private equity are buying and consolidating legacy outlets, shortchanging the people who depend on their coverage.”
The solution to this dilemma will sound familiar. “All journalism nonprofits have to make the case to donors that information is vital to millions of people and every local community,” Fitzsimon said. “A vibrant democracy where people have the information to make decisions is one of the essential building blocks of our country.”
