Projo/Belo Lobbies for Tax Credits, Fails to Disclose $13M Deal

GoLocalProv News Team and Kate Nagle

Projo/Belo Lobbies for Tax Credits, Fails to Disclose $13M Deal

The Providence Journal editorials came fast and furious with each one lobbying for passage of historic tax credit legislation before the RI General Assembly this past session. The only problem was the Providence Journal and its parent company, A.H. Belo, failed to disclose to legislators or the public that they would apply for millions in tax credits from the state of Rhode Island if the program was reinstated. The program that the paper called “good for the Rhode Island economy” would deliver millions in tax subsidies to the Dallas, Texas media company valued in excess of $3 billion dollars.

Now, The Providence Journal's $13 million project is poised to receive up to 25% of the project cost in historic tax credits - supported by the taxpayers of Rhode Island. The application is one of the finalists and top state officials say the next steps are mostly ministerial.

"The Providence Journal should have said -- repeatedly -- that it was in line to profit from the re-institution of this tax credit. Failing to do so is a tremendous breech of the public's trust," said Professor Michael Scully of Roger Williams University.

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Common Cause, Rhode Island's leading public disclosure organization, raised questions about the Providence Journal's activities. "I think it raises a legitimate question, which is, "Did the editorial board know what the business side was doing? I don't know. But it begs the question," said John Marion, Executive Director of Common Cause.

The historic tax credit program had been cancelled years earlier due to abuse and its adverse impact to the state's budget. The Providence Journal editorials called for action and passage of the historic tax credit legislation to help revive the economy.

Editorials Urge Passage, Fail to Disclose

In one editorial entitled, "Revive the Historic Tax Credits," the Providence Journal Editors wrote, "We think she’s (Sen. Paiva Weed) right. If Rhode Island seeks a relatively cheap, easy, swift and proven way to boost its economy, the program should be renewed in some form."

Beyond the editorials there were a dozen articles written by reporters Katherine Gregg, Randy Edgars and Paul Grimaldi - all citing the positive impact of the tax credit program. None of the news articles or the editorials disclosed that Dallas-based A.H. Belo/Providence Journal would seek millions from taxpayers.

"Without knowing the specifics of the Providence Journal situation, I can't comment on the particulars. But in general, a news organization should be careful to disclose whenever it has an interest in any issue that it is reporting or commenting on. That's a matter of basic journalistic ethics," said Dan Kennedy, Assistant Professor of Journalism, Northeastern University.

Taxpayers on the Hook for Millions in Tax Credits

As Ian Donnis of WRNI was first to report, Belo/Providence Journal are poised to sell their building on Fountain Street and then lease back a portion of the building. The Providence Journal/Belo's motivation for the sale of the building is more clear with the unveiling in this article of the millions in state backed tax credits that could flow to the new owner.

Moreover, A.H. Belo has been prepping the Providence Journal for sale for the past year. In the past 12 months, the Dallas-company has realized staff reductions of greater than 50 news positions through two rounds of layoffs and buyouts.

The Dallas media company announced in early December that the Providence Journal is for sale.

Efforts by GoLocal to reach publisher Howard Sutton have been unsuccessful. In addition, questions poised to Ed Achorn, editor of the editorial page were not answered.
 


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