Why we must save the SJ-R

A great news-gathering operation is immersed in its community, providing a public service by chronicling key events and exploring critical issues. But layoffs have cut the State Journal-Register staff to a fraction of its former size. The company’s 8 1/2-year pay freeze has prompted quality journalists to move on to other jobs. The scope and depth of the newspaper’s coverage has suffered. Springfield deserves better from the SJ-R’s New York-based owner.


New Media Investment Group is the parent company of GateHouse Media, which operates the State Journal-Register and hundreds of other newspapers. Fortress Investment Group launched New Media, along with other private equity vehicles in businesses like sub-prime lending and golf course management. Fortress collects hefty management fees for overseeing them. According to the New York Times in a recent article, “Last year, Fortress received more than $200 million in revenue from these companies, about a 50 percent jump from the year before.”


Fortress entered the newspaper industry in 2005 by buying the Liberty Publishing Group. Re-branded as GateHouse Media, the company went on a spending/slashing spree. It bought newspaper after newspaper, cutting staff each time. Gatehouse landed the SJ-R in 2007 and began chopping reporters, editors and photographers. Over time the printing operation moved to Peoria, allowing the company to sell off the Springfield presses. The design desk eventually ended up in Austin, Texas. Despite the profitability of its pared-down properties, GateHouse fell into prepackaged bankruptcy in 2013 due to its excessive acquisitions debt.


Fortress doubled down on its newspaper bet, re-launching GateHouse as part of the larger New Media Investment Group. The new company emerged from bankruptcy, went public and vowed to spend up to $1 billion in new acquisitions. Yet the newsroom cuts and the wage freeze continued at the SJ-R. The company siphoned off profits to underwrite acquisitions and to pay hefty stock dividends — totaling $224.6 million after three years. It bought more newspapers, cut more jobs, added more cash flow, paid more dividends, bought more newspapers and so forth. The bigger the company gets, the more management fees Fortress collects. And if the company collapses again, Fortress will come out fine. It has already collected $45 million in management fees and incentive compensation on this gambit.


Newsroom employees voted 26-4 to join the United Media Guild and gain a collective voice in the operation. They love their craft and their community. They want keep experienced journalists in this newsroom, doing good work for the people of Springfield. They are fighting imposed conditions that would extend their wage freeze to nearly 12 years. They are fighting the employee churn that extends to upper management. Since unionizing, our members have worked for four different SJ-R publishers. Top GateHouse news executives Brad Dennison and David Arkin have moved on as well. They cared about journalism. But New Media isn’t about journalism, it’s all about cash flow, acquisitions, hefty management fees and big dividends (while they last) for Wall Street investors.

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