IN MY OPINION
Hallandale Beach paper shows way to make easy money
BY FRED GRIMM
February 14, 2012
Money problems have pretty much flummoxed the newspaper industry. Corporate executives spend a lot of time obsessing over various strategies to recapture lost revenues. I worry about Strategy Number 17, which entails columnists in sandwich boards.
Who would have guessed that the solution to the industry’s financial problems would come from a little weekly newspaper in Hallandale Beach? The South Florida Sun Times gets all the credit for the brilliant new business plan: free money. Much better than cranky old guys in sandwich boards.
The Sun Times cache of money comes from the city of Hallandale Beach. The BrowardBullDog.org, a regional non-profit dedicated to investigative journalism, reported last week that the weekly newspaper received $50,000 from the city’s Community Redevelopment Agency back in 2009. The money was ostensibly a loan, but special terms excuse the newspaper from the burden of paying back more than half the money. The Sun Times gets away with repaying the other half at only 2 percent interest over 10 years.
This is what’s known in the financial sector as “one sweet deal.”
CRAs are special defined urban districts that levy taxes to fund infrastructure improvements. Stuff like slum clearance, water and sewer projects, street lights, sidewalks.
In Miami, CRA funds have occasionally been diverted toward the improvement of private property owned by the close relatives of unscrupulous politicians. We know this because newspapers like The Miami Herald dig into the CRA records and report the scandalous truth. Then the unscrupulous politician goes on radio and says unkind things about The Herald. This is the old, tried, true but not very profitable model of newspaper journalism.
In Hallandale Beach, a city conjured out of the Broward tomato fields by mob boss Meyer Lansky, the Sun Times has invented a better way. The newspaper doesn’t investigate the questionable distribution of CRA funds. The newspaper takes the funds.
The $50,000 was the first “loan” given out under a CRA program supposed to rescue struggling city businesses. BullDog.org reports that the Sun Times was the only business in the program allowed to shrug off half the loan.
BullDog.org, looking at the tax records filed with the CRA, noticed that the president of the “struggling” Sun Times was paid $259,193 in 2007 and $239,054 in 2008. The weekly’s vice president received $192,052 and $229,010 those same years.
Experts in employee compensation have a special term for this level of pay: “Wow!”
Under the old newspaper model, a courageous, slightly overweight, aging but still virile columnist would have gone berserk, suggesting that with that kind of executive pay, no wonder the Sun Times needed a bailout from the city. And why on earth, the columnist would ask, would the mayor of Hallandale Beach push such a dodgy deal through the city’s CRA?
Except that Mayor Joy Cooper, the potential object of the Sun Times columnist’s scorn, also happens to be the Sun Times columnist. Admittedly, her style does not recall Chicago’s Mike Royko (“The subject of criminal rehabilitation was debated recently in City Hall. It’s an appropriate place for this kind of discussion because the city has always employed so many ex-cons and future cons.”) or New York’s Jimmy Breslin (“Rage is the only quality which has kept me, or anybody I have ever studied, writing columns for newspapers.”)
But there she is, the mayor/columnist, with her regular space in the Sun Times, with an unfettered opportunity to enhance her public persona. Meanwhile, City Commissioner Keith London (or any other critic of municipal policy) is nowhere to be seen in the pages of the uncrusading newspaper. That may be because London has not only railed about the $50,000 loan, he has criticized the $105,000 the city has spent advertising in the Sun Times over the past two fiscal years. The Sun Times deals were never approved by the city commission, he complained.
(In 2009, a letter was mailed out to city businesses on official Hallandale Beach city stationery stating: “Just about everyone is feeling the effects of the economy and doing what we can to get through tough times. In an effort to promote and support local businesses, the city encourages all businesses to advertise in the city’s only local newspaper.” The love letter was signed by both Mayor Cooper and City Manager Mike Goode.)
A columnist under the old newspaper model would argue that the mayor has a very suspicious relationship with the recipient of so much city money. But the columnist under the much cozier Sun Times model, with the free money strategy, would write, “Hey, suckers. I’m the mayor. I do what the hell I want.”
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