Journalism Tax Credit Bill To Pay Salaries of Local Journalists Back in Budget Bill
The NAB has announced that the journalism payroll tax credit has been included in the just-released Democratic reconciliation text that House leadership plans to bring to the floor as soon as this week. This represents a significant step towards inclusion of this provision in any final Build Back Better Act package. While there remain some hurdles to the larger agreement in both the narrowly-divided House and Senate that have yet to be fully resolved, this package has gone from excluding broadcasters from credit eligibility last month, to the credit being completely dropped last week, to being re-included with full broadcast eligibility as of November 3.
Over the past several weeks of collective outreach – NAB, individual broadcasters and state associations – to dozens of key Senate and House members has galvanized support for this provision not only of champions like Sens. Maria Cantwell (WA) and Chuck Schumer (NY), but also of Speaker Nancy Pelosi (CA-12) and House and Senate tax leaders, Rep. Richie Neal (MA-01) and Sen. Ron Wyden (OR). At this point, House leaders are hoping to bring this for a vote as soon as this week. With support from all factions of the Democratic party, my view is that if this reconciliation package gets over the finish line, the provision now stands a very strong chance of being included in final passage.
Derived from the formally-titled Local Journalism Sustainability Act (LJSA), the provision would support local news production by commercial television and radio broadcasters, as well as certain print and digital publications, by making a tax credit available for the hiring and retention of up to 1,500 local news journalists each year over five years. An employer qualifies by owning or operating a broadcast station (as defined by the Communications Act) and employing “local news journalists.” A “local news journalist” is a full-time employee who works an average of not less than 30 hours per week engaging in certain activities related to developing and providing local news to the broadcast station’s local community (i.e., gathering, preparing, directing the recording of, producing, collecting, photographing, recording, writing, editing, reporting, presenting or publishing original local community news.) A “local news journalist” must also reside within 50 miles of the station’s local community.
For each employee qualifying as a “local news journalist” (capped at 1,500), the credit equals:
50% of the employee’s compensation, up to $50,000 in the first year ($25,000); and
30% of the employee’s compensation, up to $50,000 in each subsequent year for four years ($15,000 per year).
For example, if a local television station employs 50 full-time newsroom staff working not less than 30 hours per week in news function, and assuming all 50 employees make at least $50,000/year, the credits would be as follows:
Year 1: (50 qualified employees) x ($25,000) = $1,250,000
Years 2-5: (50 qualified employees) x ($15,000) = $750,000 annually
Total over 5 years: $1,250,000 + (4 x $750,000) = $4,250,000
The NAB and MAB will keep watch on this provision as the Build Back Better Act package continues to be debated.