Staying Alive

Nonprofit journalism grows and struggles simultaneously

April 2019

BY BILL BIRNBAUER

In downtown San Francisco,?Mother Jones?s CEO Monika Bauerlein is grappling with the final fact checking of an investigative story about the President?s financial dealings.

In New York City, the?Marshall Project?s editor-in-chief Bill Keller is choreographing a partnership with the?Los Angeles Times?that will assess the impact of reduced incarceration on crime rates.

At the Wall Street end of Manhattan,?ProPublica?s president Dick Tofel is surprised and delighted at the rapid growth in the number of individual donors to his organization.

And in?FairWarning?s one-room office in Pasadena, California, founder and editorial director Myron Levin is figuring out his next move in a bid to extract documents relating to enforcement programs operated by the U.S. Labor Department.

These journalists are part of an expanding sector of accountability journalism in the United States that operates under a nonprofit business model. Unlike commercial media that are funded by advertising and subscriptions, nonprofit news sites depend on grants from foundations, wealthy supporters, and, to a lesser extent, individual donors and fundraising activities.

The nonprofit investigative and public service journalism sector grew rapidly after the 2007?2009 global financial crisis that devastated commercial media revenues, leading to the loss of tens of thousands of journalism jobs and concern over the future of quality journalism. Since then, the nonprofit news sector has continued expanding, matured, and contributed to democratic processes well beyond its size.

The Institute for Nonprofit News, an association whose members (including The Reporters Inc.) are nonprofit investigative and public interest news organizations, has nearly 200 member organizations across the U.S. after being founded in 2009 with just 27 members. More than 100 of the institute?s nonprofit news organizations were created between 2007 and 2017. A survey?of its nonprofit news organizations by the institute recently found they had a combined revenue total approaching $350 million in 2017. There are an additional 110 or so nonprofit accountability news organizations in the United States that are not members of the institute. America, for all its economic, racial, political, and social issues, has at least some corrective resources when activities that support democracy are said to be at risk.

In a departure from traditional journalistic practice, many of the country?s most prestigious commercial and public media organizations now partner with and publish stories written by nonprofit center reporters. This shift represents a significant change given the distrust and wariness by mainstream media toward externally produced stories and the culture of competition between newsrooms. ?Collaboration is maybe the most dramatic change I have seen in newsroom culture in my lifetime,? observed Keller, a former?New York Times? executive editor.

New collaborations: a mutual benefit

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On November 26, 2008, the Indian financial center of Mumbai was rocked by a series of terrorist attacks that killed 166 people and wounded more than 300. Ten attackers, identified later as members of the Lashkar-e-Taiba organization, targeted American and British tourists. Using automatic weapons and grenades, they also killed Israelis, law enforcement officers, and local victims at multiple locations including the Taj Mahal Palace & Tower and Oberoi Trident hotels, a rail terminus, and a hospital. The coordinated and ongoing assault received extensive news coverage around the world including dramatic eyewitness accounts of blood-soaked victims, footage of explosions and burning buildings, as well as condemnation by world political leaders.

Almost two years after the Mumbai attack, the?Washington Post?published a two-part investigative series of more than 9,000 words that revealed in extraordinary detail the key figures, planning, and organization behind the terrorism. The two articles were everything readers would expect of a major investigation by a newspaper whose Watergate revelations in the 1970s inspired enthusiasm for investigative journalism in newsrooms around the world.

Quoting court documents, Interpol notices, counterterrorism investigators, high-ranking US law enforcement officials, French intelligence officials, and other sources, the articles exposed close links between the Mumbai terrorists and the Pakistani military and intelligence service. For all intents and purposes, the articles continued the watchdog legacy of the Watergate revelations that ultimately saw President Richard Nixon resign in 1974.

The Mumbai stories, however, were not written by the?Washington Post?s investigative journalists. They were written by Sebastian Rotella, an investigative reporter employed by?ProPublica, a philanthropically funded nonprofit investigative journalism organization based in New York.?ProPublica?published the articles on its website at the same time as the?Washington Post.

That a newspaper as prestigious as the then 133-year-old?Washington Post?would publish politically sensitive stories produced by a nonprofit organization barely three and a half years old reflected a change in American journalistic culture and practice. The?Washington Post?s cultural capital and influence are built on the foundation stones of its journalism: credibility, accuracy, independence, and impact. Mistakes or suggestions of an agenda in its stories could potentially result in political attacks, media condemnation, professional and public humiliation, public apologies, legal remedies, and reputational damage. These risks have made many legacy editors deeply skeptical about collaborating with anyone outside of their newsrooms, particularly in the field of investigative reporting.

How was it, then, that the?Washington Post?published stories from a recently formed nonprofit organization that was funded overwhelmingly by a wealthy and politically active benefactor? How is it that other?mainstream media, including public broadcasters, today routinely partner with nonprofit reporting organizations? How is it possible that new nonprofit organizations, small as they are in comparison, are beating traditional media for journalism?s most prestigious awards?? What has shifted in U.S. journalism to bring this about?

The answer is complex but it is important that we better understand the factors that coalesced to support the production of serious journalism at a time when it appeared that celebrity journalism and partisan opinion would overwhelm journalism?s mission of scrutinizing power and the traditional business model of journalism was collapsing. The nonprofit accountability news sector expanded at a time when politically charged attacks on commercial media prompted questions about whether democracy itself was at risk due to the declining influence and credibility of an already vastly diminished media landscape.

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Funding non-profit accountability journalism

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My analysis of the funding of non-profit media highlights another key characteristic of the sector ? its dominance by the three national nonprofit organizations ??ProPublica, the Center for Investigative Reporting, and the Center for Public Integrity. Over the seven years examined (2009-20015), funding for these organizations totaled $185.4 million. In other words, just three organizations received about 40 percent of the verifiable funding in this sample.?ProPublica?received $78.3 million in grants; the Center for Public Integrity $53.7 million, and the Center for Investigative Reporting $53.4 million.

Funding of the top 20 member organizations amounted to $430.8 million and included the three national organizations and others such as?Mother Jones,?Texas Tribune, the Sunlight Foundation, Better Government Association, the?Marshall Project,?Voice of San Diego, and?MinnPost.?In contrast, the bottom 20 organizations had a total income of only $7.4 million ? less than 2 percent of the total for the top 20. This demonstrates the huge disparity of funding, capacity, and ultimately power and leadership that exists in the nonprofit journalism sector.

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On the ground with smaller non-profit news organizations

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Most nonprofit investigative and public interest news organizations in the United States employed fewer staff and had far smaller budgets than the sector?s better-known national players,?ProPublica,?Mother Jones, the Center for Investigative Reporting, and the Center for Public Integrity. The day-to-day operations of many smaller organizations depended on the ?sweat equity, heart and hope? of journalists who struggled to raise funds and were ill prepared to run a nonprofit organization.

Mc Nelly Torres, a cofounder of the Florida Center for Investigative Reporting, rated her chances of receiving a big grant from a national foundation as ?one to a million.” Instead, she had to focus on cultivating relationships with local community foundations that typically supported schools, environmental initiatives, and disaster relief. Torres, a former newspaper reporter, found the biggest challenge was that ?we are journalists, we?re not business people.? She did not have the fundraising skills of some of the bigger nonprofit news organizations. ?The big guys are always on top ? so the little guys always struggle.”

The journalists who established nonprofit accountability news organizations were true believers in the media?s watchdog role and the public?s right to independently verified information. Often through dogged perseverance, they obtained information and documents that exposed illegal or immoral behavior by powerful entities. Some conceived or canvassed solutions to pressing environmental, social, and human rights issues.?Much of the time, journalists like Torres said they’re worried about having sufficient funds to do their work.

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Flash in the pan or a sustainable business model?

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Is the philanthropically funded model of investigative and public interest journalism sustainable? It is a question that the most respected and experienced players in the sector do not know the answer to. ?No-one has figured it out,? a former executive director of the Center for Public Integrity said.

Despite several successful examples of nonprofit organizations developing other sources of income, most remain reliant on foundation funding. It is not an ideal situation given the imbalance of power that exists between the two sectors. ?Foundations are notoriously fickle. The question is to what extent will those birds fly off the wire and go somewhere else? Is this a flavor of the month? I don?t know. Guess what, no-one knows,? veteran nonprofit editor Charles Lewis told me.

Lewis is right; no one knows. But the short-term trend is reassuring to those who care about quality journalism because developments in the nonprofit sector represent hope in a landscape where the news for journalism has been terrible for decades.

The nonprofit accountability news sector has moved from a rapid growth phase to now seeking long-term sustainability. Much will depend on whether institutional foundations continue to fund the sector and whether smaller community and family foundations recognize that local journalism is as much a public good as an art gallery, education, medical research, equality, civic and political participation, and the environment. Foundations to varying degrees and on an ongoing basis are integral to the business model.

Some cautious predictions

Threats exist. Despite that, I believe foundation and donor support for nonprofit investigative and public interest organizations will continue.

We can make some cautious predictions about the future. More state- and city-based nonprofit organizations may merge or enter into mutually beneficial partnerships with public radio and television broadcasters, which have established revenue streams and better infrastructure. Mergers and other partnerships can be difficult due to institutional cultural practices and a lack of familiarity by journalists of different media platforms. But they seem a natural fit.

Public broadcasters and accountability news organizations have similar audiences and a common public service mission. Public media have limited scope to produce the type of stories that investigative reporting?organizations are expert at. Mergers provide nonprofit accountability organizations an immediate and substantially wider distribution of their stories. Such partnerships provide financial stability to nonprofit organizations and increased potential for fundraising through jointly hosted events and funding drives.

Several local and niche-topic organizations may be forced to close due to funders not renewing their grants and a lack of alternative support. The national nonprofits?ProPublica, the Center for Public Integrity, and the Center for Investigative Reporting are likely to grow even larger as they continue to attract foundation support, build media partnerships, and extend their leadership roles in the sector.

The expansion of the nonprofit news sector has added a much-needed layer of professional reporting to the thin ranks of legacy investigative journalists. It is hazardous to compare the amount of investigative reporting being done today with other eras, but a recent study by Dr Beth Knobel?suggests that newspapers are concentrating on it more than ever. Almost certainly, more people than in any other period are able to access investigative stories.

Other than government funding ? problematic and probably impossible in the United States ? there does not appear to be an alternative to foundation funding. A handful of nonprofits will build on their support from individual donors and corporate sponsors, but most organizations will continue to rely on foundation grants. Journalism practice has always been impacted by external forces: recessions, technology, subsidies, advertising, partisanship, corporatization, and social trends. In this case, those forces are the economic sector ? foundations and wealthy?donors ? and government tax policies. Both have the power to shape what happens in the nonprofit accountability news sector. There is no indication that they will change their approach to nonprofit journalism, but editors remain anxious about the fragility of their base funding.

The longer-term financial sustainability of the nonprofit model is likely to be found in a combination of foundation support, mergers, increased donor support, and new revenue streams. Some nonprofit organizations may eventually convert into for-profit ventures. The investigative ecosystem in the United States will consist of a combination of for-profit online organizations,?legacy media, public radio and television, and nonmarket specialist writers, with national and local nonprofit accountability organizations collaborating with all of them.

Bill Birnbauer can be reached at?.?For more of Birbauer’s thoughts on nonprofit journalism, check out his recent interview with the podcast?Fourth Estate.?His new book,?The Rise of NonProfit Investigative Journalism in the United States,?is now available for purchase.?

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