H.R. 4514: Local Journalism Sustainability Act

This bill, known as the Local Journalism Sustainability Act, aims to provide financial support to local newspapers and media outlets through various tax incentives. Below is a summary of the key components of the bill.

1. Tax Credit for Local Newspaper Subscriptions

The bill introduces a tax credit for individuals who subscribe to local newspapers. The main points include:

• **Credit Amount**: Individuals can receive a tax credit for a percentage of their subscription costs. Initially, this is set at 80% of the subscription cost for the first year and 50% for subsequent years, with a dollar limit of $250 per year.
• **Definition of Local Newspaper**: A “local newspaper” is defined as a publication that provides original content related to local news, serves a local community, employs local journalists, and has no more than 750 employees.

2. Payroll Credit for Local News Journalists

This section provides a tax credit for local newspaper publishers based on the wages they pay to local news journalists. Key features include:

• **Credit on Wages**: Eligible publishers can receive a credit amounting to 50% of the wages paid to local news journalists for the first four quarters, then 30% thereafter.
• **Wage Limit**: The maximum amount of wages considered for the credit per journalist is limited to $12,500 per quarter.
• **Eligibility**: To qualify, a publisher must derive most of its gross receipts from publishing local newspapers as defined earlier.

3. Tax Credit for Advertising in Local Newspapers and Media

The bill also introduces a tax credit for local businesses that advertise in local media, including newspapers, radio, and television. Main points include:

• **Credit for Advertising Costs**: Businesses can qualify for a credit based on advertising expenses, with 80% for the first year and 50% for subsequent years.
• **Maximum Credit**: The credit is capped at $5,000 in the first year and $2,500 in subsequent years.
• **Definition of Eligible Business**: An "eligible small business" is defined as one with fewer than 50 full-time employees.

4. Duration and Limitations

The tax credits outlined in this bill would be applicable for a period of five years after its enactment. After this period, no new credits would be allowed for any amounts paid or incurred.

Relevant Companies

• Gannett Co., Inc. (GCI) - As a prominent newspaper publisher, Gannett could benefit from the subscriber and payroll tax credits, potentially increasing its operational viability.
• NextEra Energy, Inc. (NEE) - While primarily a utility company, should they engage in community advertising in local journalism, they could take advantage of the advertising tax credit.