Sen. Steve Stadelman (D-Caledonia) speaks at a news conference in January. The graphic on the right shows which counties in Illinois are most deprived of local news, according to the task force report. [Ben Szalinski/The Daily Line]   

The Illinois Senate approved a bill last week that is designed to spark interest from the next group of young journalists and keep newsroom ownership local, though the bill was watered down from a more aggressive version that would have created tax credits for newsrooms.

The Senate voted 43-13 on April 17 to approve SB3592 by Sen. Steve Stadelman (D-Caledonia), which establishes a scholarship program for Illinois college students to pursue journalism degrees so long as they work at an Illinois newsroom for two years and requires advanced notice when a local newsroom is going up for sale.

The bill would require that any local newsroom that is going to be sold must notify their employees and the Department of Commerce and Economic Opportunity (DCEO) 120 days before the sale.

“By requiring this notice, the hope is other local newspapers, non-profits, other corporations will have the opportunity to step in and help keep these publishers local,” Stadelman, a former Rockford TV news anchor, said.

Related: Lawmakers considering plans to boost local journalism, reduce news deserts

The bill defines a local news organization as one that produces “original content concerning matters of public interest through reporting activities, including conducting interviews, observing current events, or analyzing documents or other information.” They must have at least one full-time employee who works at least 30 hours per week covering Illinois or Illinois communities and who lives within 50 miles of the area they cover. Print outlets must publish once a month while digital-only organizations would be ones that publish at least one story about the community each week and have at least 33 percent of its audience in Illinois.

Organizations must also disclose their ownership on their website and not received more than half of their revenue from political action committees.

It’s not unprecedented in Illinois law for employers to have to give notice of changes. The WARN Act requires employers to notify employees within 60 days of a business being shut down. But some Republicans argued Stadelman’s requirement is not the same.

“Usually when small businesses sell, it’s a very confidential, quiet thing because they don’t want competitors to come poach their employees, they don’t want, [in] a newspaper’s situation, their ads to decrease, they don’t want other digital organizations or something of that nature to come poach their advertisers,” Sen. Jason Plummer (R-Edwardsville) said.

Sens. Don DeWitte (R-St. Charles), Steve McClure (R-Springfield), Chapin Rose (R-Mahomet) and Sue Rezin (R-Morris) were the only Republicans in favor of the bill.

Stadelman pointed to the increasing proliferation of large hedge funds and financial companies that have been buying up local newspapers and then proceeding to gut newsrooms.

“The problem that we’re finding we have is private equity firms are coming in and buying newspapers, consolidating them until they provide very little local news content with no local journalists,” he said.

Stadelman referenced the change at The Southern Illinoisian last year as an example. Paxton Media Group bought the Carbondale-based newspaper last year from Lee Enterprises and promptly laid off most of the staff in December. It’s the only major newspaper covering Southern Illinois.

Other newspapers in Illinois have faced similar layoffs at the hands of even larger newspaper owners. Gannett, the parent company of USA Today and owner of newspapers in Rockford, Peoria and Springfield, has consistently eliminated newspaper jobs for years. Gannett is owned by a New York City investment company. The Chicago Tribune has seen layoffs and buyouts since the hedge fund Alden Global Capital purchased Tribune Publishing in 2021.

Plummer argued the 120 days of notice will only backfire, hurting competition in the industry and giving more notice for large financial companies to buy a newspaper.

But other lawmakers said it’s not just an issue for small communities and small publications.

“My district has dozens of cities and only one of those has a local newspaper,” Sen. Rachel Ventura (D-Joliet) said. “The city is the third largest in the state. So to say that we have plenty of news or that this would continue to demolish newspapers is incorrect. We’ve been on that pathway for a long time.”

Ventura’s home city of Joliet’s only newspaper is the Herald-News, which is owned by Shaw Media. Other larger Chicago-based newspapers will also provide coverage in some instances, but do not exclusively cover the city.

Stadelman’s bill was changed from his more ambitious first draft, however. The first version of Stadelman’s bill called for state agencies to put at least half of their advertising spending into local news organizations. It also established tax credits for hiring new journalists and would have provided a tax credit of 50 percent of the wages paid to up to 150 journalists.

The tax credits are not part of the latest version of Stadelman’s bill, which is now set to be sponsored by Rep. Harry Benton (D-Plainfield) in the House but could still be considered as part of a final revenue package lawmakers typically unveil in the final days of session as they prepare to pass the budget.

New York lawmakers, on the other hand, became the first state in the nation to create tax credits to support local journalism. The New York state budget approved last week creates a $30 million annual appropriation for three years to support payroll tax credits in newsrooms. The credit will allow eligible employers to receive a 50 percent tax credit for $50,000 of a journalist’s salary with a maximum deduction of $300,000 per news organization, according to Politico.