California Journalism Tax Credits and the Barriers Facing Community Publishers

California has taken a meaningful step toward helping local news outlets keep journalists working. Whether the smallest community publishers can afford to access that help is another question. 

The Community NEWS Act, or AB2222 provides refundable employment tax credits beginning with the 2027 tax year. That means starting in 2028, eligible outlets, including nonprofit newsrooms, can receive money back even when they have little or no income tax liability. 

The goal is to “provide financial relief to local news media outlets that are struggling to maintain or grow local journalist employment.” 

This is a journalism jobs program. It does not address a community’s civic news and information needs. 

For independent publishers trying to hold onto a reporter, this law could make a real difference. 

It provides $20,000 for each of the first five eligible full-time journalists an outlet retains, $15,000 for each additional one, and $7,500 for eligible part-time journalists. It also offers $15,000 for net new full-time journalism positions, subject to the program’s rules. 

Small newsrooms get a higher credit per full-time position. A founder running an outlet as a sole proprietor can also qualify. Freelancers hired as independent contractors don’t count. 

That is welcome support. But many of the emerging and small publishers we have identified in our ecosystem assessments won’t qualify because there is a catch: publishers need money before they can receive the money. 

To qualify, a full-time journalist must work at least 30 hours a week for more than 26 weeks, at an annual pay rate—or qualifying owner income—of at least $35,000. Part-time journalists must work at least 20 but fewer than 30 hours a week for more than 26 weeks, at an annual pay rate of at least $25,000. 

A hyperlocal publisher, whose community depends on her work, may work far more than 30 hours while paying herself far less than $35,000. Think about the founder who reports, edits, sells advertising, and answers community questions while paying herself whatever remains. Her work may be indispensable. Her income may still fall below the threshold. 

Then there is the wait. Rebuild Local News, which lobbied for the law, expects many first payments in 2028 for employment in 2027. Publishers must sustain payroll until that money arrives. For some independent publishers, that may be too late. For a newsroom living

month to month, maintaining payroll until a refund arrives could be difficult. An eventual payment cannot cover this Friday’s payroll. 

Outlets also need media liability insurance throughout the tax year, public ownership or board information, a public corrections policy, and at least 12 months of California organization or registration before the tax year begins. These requirements take administrative capacity and, in some cases, money. 

The insurance requirement deserves particular attention. It offers important protection, but requiring publishers to buy coverage before accessing public support can create a financial barrier. In that sense, I worry it could function like a modern-day poll tax: publishers have to pay to participate. 

These requirements have legitimate purposes. They also take money and administrative capacity. A trusted community provider may meet an urgent information need while lacking the infrastructure to claim the benefit. 

Founders of color and outlets serving immigrant communities can qualify. The law does not require English-language reporting. The law does not include dedicated allocation or priority for those publishers or their communities. 

It supports corporate-owned outlets, including those owned by hedge funds and billionaires, a concern Newsom acknowledged. Larger employers can receive larger total benefits even though small newsrooms receive a higher rate for their first five qualifying positions. 

This is a journalism jobs program. Its eligibility rules do not make it a civic news-and-information-needs initiative. 

Saving jobs matters. But we should be aware of: Who gets the support? Whose communities gain coverage? Who is left out? 

For publishers, now is the time to check eligibility and plan for the wait. For funders, this is an opportunity to help cover insurance, accounting, and payroll until refunds arrive. 

I welcome this investment. But access matters. Publishers already doing essential work should have a fair chance to benefit—even when they are struggling to pay themselves. 

Tracie Powell is the CEO of The Pivot Fund, which invests in hyperlocal civic news and information infrastructure.