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The Pleasanton Weekly’s parent organization, Embarcadero Media, went through a huge transition in January when the 44-year-old news group became a nonprofit news organization.
Our reason behind the conversion could be likened to an emergency surgery — there was severe pain (financial), an urgent need and it was necessary for survival.
It’s no secret that the news industry’s advertising-based business model has drastically changed over the past few years because of the shift from print to digital. Like so many other media small groups, the pandemic quickened the pace of declining revenue for us.
More and more news organizations across the country have been making the same change from for-profit to nonprofit status, and new nonprofits are launching. However, this is a fairly new trend, so there are few places to turn for best practices or even advice on the many questions we have.
One particular issue many nonprofit news publishers are struggling with is the IRS policy of nonpartisanship and the confusing rules around “political engagement”.
As a journalism nonprofit, we are now subject to IRS rules that prohibit political engagement by 501(c)(3) organizations. That means our editorial board can no longer write endorsements of political candidates.
The prohibition on endorsements also extends to reader opinion such as Letters to the Editor and online comments. Guidelines suggest that if such opinions are published, they must be provided in equal amounts to all candidates.
We can and will continue hosting candidate forums, writing editorials on ballot measures and compiling voter guide information such as candidate profiles and campaign finance records. Political advertising is exempt from the rules.
Our editorial board wants to continue to provide space for different perspectives from readers, but the consequences for running afoul of the IRS policies are potentially catastrophic — we could lose our nonprofit status.
Therefore, we have decided we will not allow comments about candidates on our online stories and will not run Letters to the Editor about candidates in our print edition.
We understand the disappointment this causes, but our vulnerability is too great.
Being creative, but still coloring within the IRS-defined lines, our organization is considering a plan that would allow us to provide a platform for community members to express different perspectives and opinions about candidates without jeopardizing our 501(c)(3) designation.
Because advertising is fair game, we could charge for political letters and publish them as “advertisements”, which would be grouped on a page of Reader Opinions.
As with political advertising, if the rates are the same for everyone, there is no perception of bias or “advocacy” on our part. But we do have to charge what we would charge an advertiser for the same space in the newspaper, which would be $100 per ad, to not appear to be subsidizing political advertising, which can get us into hot water with the IRS.
Guidelines would be set as we do with all advertising. For example, each opinion would have “Paid Advertising” prominently displayed within each box.
As with Letters, there would be a word limit, a review of the text for accuracy and fairness, an author’s name required and a limit of submissions to one per author per race.
This is not optimal, and we recognize that. But it’s either this or we refuse all opinion pieces in which candidates are mentioned because we won’t jeopardize our existence.
Please reach out to our publisher, Gina Channell Wilcox, gchannell@pleasantonweekly.com, with your thoughts.
This editorial is well-written and much appreciated. Thank you for explaining.