On the list: ad expense deduction, shield law, patent trolls and USPS

By Dennis Hetzel, Executive Director

Dennis Hetzel

Hetzel

I have an easy solution for moments when Ohio politics seems too weird and dysfunctional.

Take a trip to Washington.

The frustration level about the inability, with rare exceptions, to pass good laws is every bit as deep as you might suspect.  The atmosphere is far more toxic than anything I routinely observe at the Statehouse.  I worry about our country at times. America used to have a reputation as the nation that worked through its differences and found positive ways to get things done.

Every December, newspaper association managers from around the country gather in Washington for a government affairs conference.  We compare notes, share stories of battles won and lost and make sure we are on top of legislation that just might be coming to a state near you.

For the past three years, I have stayed an extra day-and-a-half to visit key members of the Ohio delegation in Congress.  During this year’s trip I discussed what we believe are the top four federal issues that could affect Ohio newspapers. Here are the positions we shared with several members, including Sen. Rob Portman and Sen. Sherrod Brown’s legislative director:

1. Don’t reduce the advertising expense deduction

We are strongly opposed to any change that would remove full federal deductibility for advertising expenses. These are legitimate business expenses; indeed, often among the most critical. Suggestions to amortize over 5 or 10 years have major flaws.  First of all, this does not make sense in principle. Advertising is an immediate need and the “shelf life” of messaging grows ever shorter.  This also adds new complexity to the tax code. Most importantly, studies consistently show the great value that advertising adds to the economy – roughly $20 in sales for each $1 spent. Finally, this would cause advertisers to spend less, with potentially devastating consequences to many media outlets, including newspapers and their digital products.

2. Pass a federal shield law

ONA joins with numerous groups in supporting the need for a shield law offering protection to journalists from having to reveal confidential sources. We believe this can be done consistent with our national-security requirements.

3. Deal with the problems of the Postal Service

Saturday mail delivery remains an essential need for many of our weekly newspaper members with no cost-effective alternative.  Ongoing service problems with the USPS magnify this as, even now, some customers don’t get newspapers until early the following week, causing advertisers to lose value by missing weekend customers. Proposed, major rate increases for publications will add new challenges and drive away more customers.

The newspaper industry continues to oppose the “favored nation” status the USPS is giving to direct-mail competitors and supports legislation to block or limit future such agreements at the expense of others.  We recognize the USPS must take significant steps to reduce costs. This should be done without harming some of the Postal Service’s most loyal customers or driving more business away.

4. Pass good legislation to stop ‘patent trolls’

The ONA joins many groups urging the House Judiciary Committee to address abuses of the legal system by entities often called “patent trolls.” Some of our members have been caught up in such litigation. These claims typically are based on old, technology-related patents that are loosely interpreted to allege patent infringement. A number of promising ideas are making the rounds, and we are pleased that a good bill has passed the House. These proposals would curb extortion-like abuses while protecting legitimate patents.

Several states face threats to advertising, newspaper notices

At our D.C. conference, I also was on a panel with colleagues from Minnesota and Louisiana to talk about successful fights waged in our three states to defeat sales tax expansion, particularly on advertising.

There are chilling threats in several other states that directly threaten public notices in newspapers.  For example, Pennsylvania newspaper publishers are fighting a bill that has passed a House committee that would make print notices optional. In Oregon, a trade association is mounting a direct assault to put all sheriffs’ sale notices on its website and take them out of newspapers.  Their prototype Web product is impressive and slick.

These discussions make me appreciate how we have stabilized the situation in Ohio with the reforms of 2011. I should add that the Kasich Administration has been an honest broker with us, living up to the agreements we made at that time. However, as I observe what is happening around the country, I also know that we can’t stand still.

This is why a legislative goal for 2014 is to make our public-notice website, PublicNoticesOhio.com, the official digital location for notices in Ohio.  Several states besides Ohio now are using the same platform for the public notice site first developed by the Illinois Press Association. We met to discuss what new features we need to develop to stay ahead of the digital curve. The top priority is to make sure the site is mobile-optimized.

These legislative skirmishes never end, but that’s why we’re here.

 

From all of us at ONA, please enjoy a safe and happy holiday season. The work we do for you is a privilege, and we are thankful that you make it possible.

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