You Should Know Who’s Funding Your Local Paper

A call for more transparency in Maine

Welcome to Second Rough Draft, a newsletter about journalism in our time, how it (often its business) is evolving, and the challenges it faces.

In the good old days of newspapers, nonprofit papers were rare things—the St. Petersburg (now Tampa Bay) Times had been left in the hands of the Poynter Institute, the Christian Science Monitor was a venture of the church; that was about it. As the business model of newspapers has failed, things have changed: the Philadelphia Inquirer was also given to a nonprofit, hedge fund owners have been widely rumored for months to be looking to spin off many of their loss-making smaller papers into nonprofit hands, other one-off conversions are being explored and the National Trust for Local News (NTLN) has emerged to buy and convert papers, first in Colorado, later in Texas, and most recently all but one of the daily papers in Maine.

Hooray for nonprofit papers

All of this, in my view, has been salutary, even if not a panacea. Reducing the target profit margin to zero, as nonprofit conversion effectively does, still requires that revenues and expenses be in balance over time, and local support and smart business management will still be required for that. But nonprofit newspaper ownership is something we should welcome.

Of course, getting the for-profit owners to surrender their assets will, at least in some cases, require a capital investment, so there is a role here for major philanthropies. Again, that’s a good thing.

But particularly in a time of such rampant distrust in our society, especially with respect to the press, we need significant transparency around these transactions if trust and credibility for the converted papers is to be maintained. In Maine, at least so far, things have fallen short on that dimension.

NTLN announced in July that it had agreed to acquire 22 daily and weekly papers in Maine, including the Portland Press Herald, as well as the daily papers in Augusta, Brunswick, Lewiston and Waterville. When the transaction closed on August 1, the purchase price had still not been disclosed, but the CEO of NTLN, Elizabeth Hansen Shapiro, was quoted in the Press Herald promising to “share more information about who supported the purchase” by the end of September. That’s the day after tomorrow, and it hasn’t happened.

When no such disclosure had been made by the 18th of this month, Semafor reported that billionaires George Soros of New York and Hansjorg Wyss of Wyoming “gave millions to the National Trust for the purchase of the Maine newspapers.”  My own reporting confirms that that is true, and it appears very likely that these two gifts accounted for the bulk of the money that made the deal possible.

Semafor got a comment from Soros’s Open Society Foundations (OSF) acknowledging that it was a general-support funder of NTLN, but “denied that Open Society committed funds specifically for the project.” The Semafor story didn’t evince any attempt to get a comment from Wyss.

What I learned

My own reporting included the confirmation of the gist of the Semafor story noted earlier. OSF told me its general support of NTLN (totaling millions of dollars) goes back to 2019, and gave a similar statement to the Bangor Daily News, the only Maine daily now not owned by NTLN. But when I asked OSF if it had increased its support in 2023, I didn’t get a substantive response. It may also be the case that the latest Soros gift came from an entity other than OSF—there are many. An inquiry to the Wyss Foundation also didn’t get a reply.

The National Trust ostensibly lists supporters on its web site, but Wyss and the Wyss Foundation are absent, as is any Soros entity other than OSF. The Trust does not disclose Schedule B of its IRS Form 990 listing contributors, which I have long argued nonprofit news organizations should do. It may be that NTLN agreed in grant agreements not to disclose the gifts which supplied some or all of the bulk of the Maine funds. If so, in my judgment, that was a mistake on both its part and that of the donors. NTLN acknowledges that about 15% of its funding comes from donors whose identity it knows but who prefer to remain anonymous, and with respect to whom it makes no disclosure.

The Semafor story, which greatly annoyed the folks at NTLN and the Maine papers it owns, is a good illustration of why opacity in these matters is such an error. It framed the Soros and Wyss contributions as political, and raised the specter of the papers being left-wing mouthpieces.

How I see it

I think that’s a canard. The previous management of the papers remains in place, and a new local board is being installed. The local publisher and editors are respected for their independence. Soros has been giving to many nonprofit journalism organizations—including, through OSF, ProPublica when I ran its business operations—for many years, and there has never been any indication whatever of even an attempt on the part of him or the OSF staff to influence reporting.

The Semafor story sought to juxtapose the NTLN Maine papers with a new effort called the Maine Wire, backed by Leonard Leo’s money machine; the Wire, Semafor noted, had highlighted Soros’s support of NTLN. But the Wire’s own follow-up story focused on another upstart, the Maine Morning Star, a new affiliate of the States Newsroom, which the Wire said is also funded by Soros and Wyss. (States Newsroom lists the Wyss Foundation as a funder, but not Soros or Open Society; OSF said it has not supported States Newsroom.) Of course, if Wyss is somehow secretly controlling the NTLN papers, why is it bothering to launch another outlet in Maine? The Wire didn’t say.

Moreover, let’s be candid, invocations of Soros as a sort of bogeyman have long since become a principal way to dog whistle anti-Semitism; it ranks right up there with “globalist” in this rhetoric. In my years at ProPublica, Soros’s OSF was always far from the largest donor, but Soros personally was usually the name people who didn’t like our coverage invoked first and loudest.

But that’s also sort of the point. I saw, and see, no reason not to take general support money from OSF, and would have felt the same way about the Wyss Foundation (or, for that matter, Charles Koch). It would be naïve or worse, however, not to understand that gifts from controversial people may come with controversy. If you disclose them, you send an important signal that you understand that and accept it, and also, at least in my view, bolster reasonable people’s confidence that you remain independent of these donors— along with all the others.