Illinois newsrooms receive $4 million from state through tax credits
Forty Illinois local news entities operating 120 outlets are receiving $4 million in state tax credits under a new law designed to encourage the retention and hiring of journalists, according to documents released last week.
The organizations that have received credits represent a cross section of Illinois’ local news ecosystem, according to records obtained through a Freedom of Information request by the Medill Local News Initiative.
They span major legacy organizations, small community newspapers, digital startups and public broadcasters. Most of the funding went to organizations outside the Chicago metro area. Nonprofit outlets received 30% of the money. Most news organizations in Illinois are for-profit.
Paddock Publications, Inc., the parent company of the Daily Herald, was among the recipients.
“What I see is what appears to be a very efficient program at delivering public dollars to a broad range of community news organizations covering almost every corner of Illinois,” said Matt Pearce, director of policy at Rebuild Local News, a nonprofit advocacy group. “I think that’s reflected in the fact that this is a subsidy built into the tax code, and it’s accessible to any eligible publisher.”
So far in Illinois, 61 entities have applied for funding with 49 of those approved. Five applicants had their applications denied and seven more applications remain under review. The Department of Commerce and Economic Opportunity did not immediately provide a response to written questions about who was denied, and why.
The tax credits are distributed on a first-come, first-serve basis. To receive funding, news outlets must apply and demonstrate eligibility based on certain criteria, including consistent publication of original local content and employment of journalists.
Absent from the list of recipients were the nation’s two largest publishers of local news: Gannett, which publishes 11 dailies in the Western and central parts of Illinois, and Alden Global Capital, the investment firm owner of the Chicago Tribune. It’s unclear whether they applied and were denied or chose not to apply. Representatives of the companies did not respond to written questions.
The legislation attempted to cap the amount of funding to organizations backed by private funds like Gannett and Alden. One such company, Lee Enterprises, still managed to be the largest recipient of Illinois’ tax credits at $375,000 across applications it submitted for four newspapers in the state.
Earlier this summer, Illinois became the first state in the nation to distribute money directly to local news organizations for employing journalists. The Illinois law is the latest step in the growing movement of state and local governments using legislation to intervene in the local news crisis, even as the federal government clawed back $1.1 billion in funding for public broadcasting last month. Twenty-two states and municipalities have passed or are considering bills to support local news, according to Rebuild Local News.
Medill’s State of Local News Project tracks more than 200 counties without a source of professional local news and an additional 1,500 with only one remaining news source. That covers half of all counties and more than 53 million Americans. Illinois currently has five news desert counties and has lost 45% of its newspapers since 2005. The state lost 54% of its newspaper employees in the decade ending in 2023.
“I think this confirms there’s a great demand, a great need for local media outlets to receive this assistance,” said Illinois state Sen. Steve Stadelman, a Rockford Democrat, who chaired the bipartisan Illinois Local Journalism Task Force that studied the crisis and issued a report earlier last year. “I’m really pleased that we’re getting money out the door already.”
Illinois’ legislation, passed in May 2024, makes available $25 million over five years for local news organizations that hire and retain journalists in the form of refundable tax credits. In its first year, $5 million is available in tax credits broken into two buckets, with $4 million earmarked for retaining journalists and the remaining $1 million for newsrooms that add new journalists. A little over $1 million remains available in 2025, with 78% of the credits for expanding newsrooms unclaimed.
In the closest parallel, New York allocated $90 million over three years for local journalism in its 2024 budget. But that program has stalled in the State Assembly and none of that money has reached New York newsrooms yet.
Don Craven, president of the Illinois Press Association, expressed satisfaction with the rollout of the program, while noting there’s still work to be done to not leave money on the table.
“I know our members who got tax credit certificates were dancing in the aisles,” Craven said.
View the complete list of applications and awards here:
• John Volk manages, updates and analyzes the Medill Local News Initiative’s database of news organizations. He previously worked at the Star Tribune, the Local News Accelerator and Northwestern Athletics.