Size matters in non-profit news
The five-member staff of the Chi-Town Daily News was laid off after Labor Day when its founder could not raise the $300,000 necessary to fund the balance of its annual budget.
But Pro Publica, the biggest of the new-breed journalism non-profits, is thriving on a budget that will hit $9 million this year.
This disparity dramatically illustrates the difference between the resources available to an earnest but under-funded grassroots news start-up and a non-profit journalism project that has entered the ranks of the major-league philanthropic organizations.
The size and scope of Pro Publica, a formidable and enviable national investigative reporting project, hints at the way other big-league journalism non-profits may evolve.
By far the largest of the new journalism ventures, the New York-based project started life two years ago with a pledge of $30 million in ongoing support from Marion and Herbert Sandler of San Francisco.
Since then, Pro Publica has undertaken comprehensive and granular coverage of federal stimulus spending and worked with such partners as the New York Times to investigate the case of the medical professionals accused of killing seriously ill patients at a hospital struck by Hurricane Katrina in New Orleans. It has investigated the environmental danger of a gas-drilling practice called hydraulic fracturing and tackled the thorny issue of what to do wtih the terrorism suspects now detained at Guantanamo.
The ambition and funding of Pro Publica is surpassed in the realm of non-profit journalism only by National Public Radio and the Public Broadcasting System, which are long-established organizations that depend on a combination of government support, philanthropic largesse and contributions from listeners and viewers like you.
Pro Publica operates at a level far beyond any of the non-profit news start-ups that have emerged to date to address the crisis in local coverage caused by the contraction of newspapers and local broadcast media.
Unlike the Chi-Town Daily News, whose tiny staff of five was laid off this month because founder Geoff Dougherty could not raise the entire $300,000 necessary to make this year’s modest payroll, Pro Publica has an annual budget of about $9 million, according to Richard Tofel, its general manager.
The Pro Publica staff consists of 32 full-time journalists and 5 administrators, plus a few paid short-term interns and fellows, said Tofel. Its expenses in 2008 included a salary of $570,000 for editor Paul E. Steiger, the former managing editor the Wall Street Journal, and $296,370 for Tofel, according to the organization’s tax return.
“The Daily News needs $1 million to $2 million per year to do a great job of covering a city as sprawling and complex as Chicago,” wrote Dougherty in his blog. His estimate is consistent with the annual budget targets developed by the operators of such other journalism non-profits as MinnPost, Voice of San Diego and the still-to-be launched Texas Tribune.
As a consequence of its bare-bones budget, the scope and caliber of reporting at the Daily News was understandably limited, trending in the month prior to the layoff to such things as a new soup-kitchen website or the coverage of dull-but-important bureaucratic news.
Dougherty never got close to raising the money he said he needed to realize his goal of recruiting and training volunteer journalists to cover each of the 70 neighborhoods in the city. Despite “hundreds of phone calls and letters to foundations, corporations and individual donors over the past four years,” he said, he raised a total of only $600,000 since 2005.
By contrast, the New York-based Pro Publica has collected some $14 million in donations since inception, including $8.5 million in 2008. In addition to an $8 million donation from the Sandlers in 2008, Pro Publica collected $554,734 from half a dozen other organizations like the MacArthur Foundation, the Monarch Fund, the Peter G. Peterson Foundation and the Atlantic Philanthropies, according to its tax return.
Counting the Sandler gift, the average donation at Pro Publica last year was $1.2 million per donor. If you take out the $8 million provided by the Sandlers, the average donation among the other benefactors was $90,789.
Pro Publica recently received $1 million from the Knight Foundation to hire two noted consulting firms to help raise more money. “We will be involved in fund-raising for the rest of our institutional life,” said Tofel in a telephone interview. “We will never be done. Even the New York Philharmonic is not done.”
Fund raising is a way of life, too, at MinnPost and Voice of San Diego, two other notable online journalism non-profits. But it occurs at a far smaller scale than at Pro Publica.
MinnPost founder Joel Kramer said he and his wife, who both work without pay, have raised $2 million from some 1,700 donors since the non-profit news site was founded in November, 2007. That works out to an average of $1,176.47 per donor.
At Voice of San Diego, chief executive Scott Lewis said his organization has raised a bit more than $3.5 million from 962 donors since launching in 2005. That works out to an average of $3,669.44 per donor, thanks in large part to a series of gifts totaling $1.3 million over the years from its original angel, local businessman Buzz Woolley.
Woolley, who provided 30% of the site’s operating budget in 2008, told James Rainey of the Los Angeles Times that he would like to reduce his contribution “to avoid a perception that one individual holds too great a sway.”
Although Lewis said donations to his organization are on track with expectations, he and his colleagues expect to be engaged in continuous fund raising to ensure it thrives “into perpetuity.”
It's a choce he wouldn’t trade for anything. “I am living a dream,” he said. “I would do it 1,000 times again.”