IRS vs nonprofit media

in USA Today:

From National Geographic to Consumer Reports to the Associated Press, nonprofit media outlets have provided an important supplement to commercial media for many years. More recently, as newspapers around the country have contracted, a new wave of nonprofit news outlets has emerged — created by concerned journalists, citizens and communities to help plug the growing gaps in reporting caused by the shrinking budgets of traditional for-profit news sources.

In 2009, the Investigative News Network (INN), a consortium of 60 non-profit news organizations, was formed to help these news startups survive. So it was unsettling when INN had trouble getting its tax exempt status approved by the IRS — and it was downright appalling when the IRS offered them a Faustian bargain: they would approve INN’s tax exempt status if they removed the word “journalism” from their statement of purpose.

INN is one of a disturbing number of nonprofit media groups that have had their nonprofit status delayed by the IRS. The San Francisco Public Press, a nonprofit newspaper geared toward low income and under-represented communities, waited 32 months for its approval. The El Paso Newspaper Tree, which does investigative reporting on corruption in the El Paso/Juarez area, has been waiting since April 2011. The Chicago News Cooperative never got its nonprofit status approved, and cited that as among the reasons it went out of business.

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