After a year of record high newsroom layoffs, the U.S. Small Business Administration has expanded eligibility criteria for PPP loans to include smaller news organizations for 2021.
Following the passage of the 2020 CARES Act, small publishers were frustrated that several venture-backed news organizations – including Axios and Bustle Digital Group – received PPP loans in the millions, despite having access to other funding sources, Digiday reported in April. Axios later returned their PPP loan, citing politicization around the loans and access to other sources of funding.
Still, newsrooms were left frustrated by the fact that nearly two thirds of U.S. newspapers had been excluded from the PPP loan program despite the significant impact of the COVID-19 pandemic on news media. According to a new study from the global outplacement firm Challenger, Gray & Christmas, newsroom layoffs grew nearly 200% in 2020 and was hit with 16,160 job cuts – up 13% from the industry’s previous record set in 2008, reports The Wrap.
As we have reported here before, the past year has been especially difficult for local news outlets whose revenue depends heavily on advertising dollars from local businesses within their communities. Many of these businesses were unwilling to spend their money on advertising during the pandemic, leaving many local news organizations in dire straits.
Fortunately, the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 (CRRSAA), which was signed into law on December 27, 2020, has expanded eligibility requirements to allow more newspapers and TV stations to qualify for PPP loans. Legal analysts at JD Supra published details on changes to the eligibility requirements here.
The action was immediately celebrated by the News Media Alliance, a trade association representing nearly 2000 newspapers in the United States and Canada. In a press release following the passage of the CRRSAA, News Media Alliance CEO David Chavern stated, “These SBA loans will allow news publishers to continue to bring critical news and information to their local communities, particularly at this time of historic challenges.”
The press release went on to say that the association was “extremely grateful to all of the congressional champions, in both the House and the Senate, for their enduring support of high-quality local journalism, and for their leadership in gathering bipartisan support for an SBA affiliation waiver for news publishers.”