More than 130 organizations support AB 2222, which would give California newsrooms tax credits based on how many journalists they employ. A coalition of labor unions, press associations, publishers, and civic groups has asked Governor Gavin Newsom to sign this legislation, one of the most closely watched decisions of the governor’s bill-signing season.

The letter, sent on September 9, urges Newsom to approve Assembly Bill 2222, known as the Community Newsroom Employment and Workforce Sustainability Act — the Community NEWS Act. The signers include various organizations such as SAG-AFTRA, the Communication Workers of America, the National Association of Broadcasters, and the National Newspaper Publishers Association, as well as California outlets like the San Francisco Chronicle, CalMatters, KQED, La Opinión, the Sacramento Observer, and numerous weekly, ethnic media, and rural publications.

The governor has a deadline of September 30 to sign or veto the measure. His office has not commented on the legislation currently under review.

AB 2222 was introduced in February by Assemblymember Christopher M. Ward, D-San Diego, with joint authorship from Assemblymember Buffy Wicks, D-Oakland, and sponsorship from the nonprofit Rebuild Local News.

The bill proposes refundable tax credits tied to newsroom employment. A job-retention credit would provide $20,000 per journalist for the first five positions and $15,000 for each additional one, with half-credits for part-time staff. Smaller outlets and those adding jobs would receive enhanced benefits.

The eligibility criteria are broad, allowing print, digital, and broadcast outlets to qualify, whether they operate as for-profit businesses, nonprofits, or sole proprietorships. Supporters note that screening provisions are included to prevent partisan operations from mimicking local news while giving newsrooms independence in coverage.

The state’s tax board estimates that the program would generate more than $40 million annually for California newsrooms, making it one of the largest state-level supports for local journalism in the United States. The credits would apply to tax years starting January 1, 2027, under a five-year program, meaning the funds would not be immediately available after enactment.

The program would be funded by ending a state corporate deduction for executive compensation above $1 million, a deduction already disallowed by federal law. Proponents suggest the program would be revenue-neutral or potentially beneficial for the state’s budget.

The coalition’s letter references research indicating the impact of declining local coverage. According to the letter, the U.S. has seen a reduction of more than 80 percent in local journalism since 2002. California, despite its size, ranks among the states with the fewest journalists per capita, with many counties categorized as news deserts.

The letter also outlines a fiscal argument, citing an analysis that estimates thin local coverage costs local governments approximately $1.1 billion annually due to increased municipal borrowing costs.

Similar journalist employment credits have been enacted in New York, Illinois, and New Mexico.

Opposition to AB 2222 exists, including from the California Taxpayers Association and business groups such as the California Chamber of Commerce, which argue that it may raise taxes on employers. An analysis from the governor’s Department of Finance noted that the measure lacks a cap on total credits and primarily subsidizes existing positions rather than focusing on new job creation.

Support for the bill is bipartisan but not universal. The Senate passed it on August 30, and the Assembly concurred the following day, although some Republicans who had initially supported it withdrew their votes.

Ward has described the bill as both an economic and civic investment. Charles F. Champion, president and chief executive of the California News Publishers Association, has expressed cautious optimism about the bill’s outcome, acknowledging opposition to the executive-pay provision.

If Newsom signs the bill, California may serve as a significant test of whether public policy can support local journalism. A veto would indicate challenges for the coalition supporting AB 2222.