Senators Focus On SBA Rule In Effort To Get Federal Aid To Local Media Like Radio.

Story by Inside Radio

There may not be any actual aid to broadcasters struggling to make their payroll, but there’s certainly no shortage of letters from members of Congress to comfort owners as their cash reserves dry up. The latest is from a bipartisan group of Senators to their leadership as negotiations on the next coronavirus-related stimulus bills continue. The lawmakers are asking that they include provisions that would make thousands of local radio stations and newspapers eligible for the Paycheck Protection Program, which offers forgivable loans to small businesses to pay their employees during the COVID-19 crisis.

The letter – signed by Senators Maria Cantwell (D-WA), John Kennedy (R-LA), Amy Klobuchar (D-MN), and John Boozman (R-AR) – says the Small Business Administration explicitly “cut out” local broadcasters and newspapers from the program. That’s because the SBA determined the outlets were exempted by the SBA’s rule, which restricts assistance to companies owned or controlled by larger entities. But the senators say that that while stations and newspapers may be owned by multibillion-dollar corporations, the local outlets “operate independently” and should be allowed to tap into the stimulus effort. The senators think the SBA could craft guidelines that would ensure the local operations benefit from the relief without the financial assistance flowing to the parent companies. They point out a similar waiver was allowed for hotels and restaurants. “The same consideration should extend to local news outlets in light of their vital role in maintaining public health,” the letter says. https://www.cantwell.senate.gov/imo/media/doc/2020%2004%2018%20Local%20Newspaper%20+%20Broadcaster%20Letter.pdf

News Media Alliance President David Chavern said SBA loans have already helped some local news publishers keep reporters employed and their newsrooms running as an essential function, but others have been left out because they are part of groups with other small publishers or non-news businesses. “We are requesting changes to the SBA loan program [that] would allow funds to flow to more local newsrooms,” said Chavern.

Meanwhile in the House, there’s overwhelming support for the government coming to the aid of broadcasters. More than 240 lawmakers have signed a letter to the Trump administration asking it to direct federal advertising funds to local news and media outlets. “This national emergency has caused a near halt to local business activity and in turn, the regular and vital advertising they purchase from local media. Without advertising revenue, local media outlets cannot survive,” the bipartisan coalition wrote. And if there are any federal programs where community outreach is needed, they also urge that to include local media advertising. The letter had been circulating since last week.

The House members also encouraged the President to support any stimulus packages that push recipients of federal dollars to use a portion of what they receive with local media, including those serving minority and rural communities.

What’s motivating lawmakers to stand alongside the media are reports from industry groups showing the impact that a virtual closing down of U.S. business has had. The National Association of Broadcasters found that some local broadcasters have reported that up to 90% of their advertising revenue has been lost, they tell Senate leadership. By some estimates advertising losses for local TV and radio broadcasters are estimated to reach at least $3 billion nationwide. They also point to an IAB survey of advertisers which found that traditional media outlets could see a 43% decline in ad revenue in March and April. And the News Media Alliance says newspapers have lost up to half of their ad revenue for the second quarter. “Local newspapers and broadcasters have been hit hard by the COVID-19 crisis, are essential for maintaining a well-informed public, and deserve our help,” the senators say.

NAB President Gordon Smith welcomed the support in the Senate to expand SBA loans to local radio and TV stations under the Payroll Protection Program. “America’s radio and TV broadcasters take seriously our responsibility to report, inform, comfort and educate our hometowns during these unprecedented times,” Smith said in a statement. “Unfortunately, with economic activity at a standstill, local broadcasters are struggling without the local business advertising dollars that sustain stations and help local businesses generate commerce.”

The NAB joined with other media groups this month in seeking federal aid. They said if another stimulus bill is drafted, it should include an additional $5 to $10 billion in direct funding which federal agencies could spend on local media advertising.
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Read more - US Senate Letter: https://www.cantwell.senate.gov/imo/media/doc/2020%2004%2018%20Local%20Newspaper%20+%20Broadcaster%20Letter.pdf