Foundation didn’t cave in under Chicago News Cooperative

Elspeth Revere

There’s no question that the Chicago News Cooperative, which will shut down Sunday, had a long list of problems. But despite what you may have heard or read, one of those problems may not have been the John D. and Catherine T. MacArthur Foundation after all.

As the CNC’s largest single funder, the Chicago-based foundation was on the verge of approving a third grant to the nonprofit news organization — on top of the $1 million it had already donated since 2009. It might not have been the full $200,000 that was being sought, but more money was almost surely on the way. Then came the call last week from Jim O’Shea, founder and editor of the CNC, telling the MacArthur people it was all over.

“I was really surprised that they were about to cease operations,” said Elspeth Revere, vice president for media, culture, and special initiatives at MacArthur. “I didn’t think they were that close to the edge. And I was disappointed, too.”

Some reports (including my own) suggested that MacArthur had reduced or withdrawn support because of uncertainty over the CNC’s status with the Internal Revenue Service as a 501(c)(3) nonprofit organization. But Revere insisted that either way it wouldn’t have made any difference in the size of the grant to be given to CNC. “We didn’t have an issue with that,” she said. “We were moving forward, I thought, together.”

Could there have been a misunderstanding? “You know, it’s always possible,” Revere said. “We did start asking a lot of questions, and we did need different information than we had asked for in the past. So it is possible there was a misunderstanding. But we pretty much had confidence we were going to succeed in making a grant.”

More disturbing to Revere and her colleagues was speculation that MacArthur undermined the CNC for political reasons. Without naming him, they appeared to be pointing to Chicago Current blogger Geoff Dougherty, who posited the theory that the foundation yanked its funding “because MacArthur has close ties to City Hall, writes large grants to programs at the Chicago Public Schools, and is likely uncomfortable with backing a news organization that might report critically on those programs.”

Dougherty’s theory might never have gained currency if it hadn’t been amplified on larger platforms, including Jim Romenesko’s blog and David Carr’s Twitter feed.

“There are stories that implied MacArthur’s relationship with city government somehow led to CNC ceasing operations without any basis of evidence, without an attempt to reach out to MacArthur for comment on that wild accusation,” said Andrew Solomon, vice president for public affairs at MacArthur. “It’s just bad reporting, it’s bad journalism.

“MacArthur was one of CNC’s earliest and most generous contributors. Why would we have done that if we wanted them to fail? It’s absurd logic.”

Revere agreed: “I certainly was not wanting to put them out of business, as some of the news media have suggested inaccurately. And I don’t get that, because we’re not in business to put people out of operation. We make grants to help projects do their work.

“We do support a lot of other news organizations. You could talk to any one of them, and I think they would say we never get involved in the editorial side of what they do. Because that’s the truth,” she said.

Dougherty’s claim that the CNC’s investigative reporting aimed at City Hall made the foundation “uncomfortable” elicited a flat-out denial from Solomon to me — and this statement from O’Shea to Romenesko: “Even a cursory amount of reporting would show that to be totally untrue. No one at the foundation ever complained or interfered with our coverage in any way. At all times, MacArthur and everyone involved in our relationship acted with integrity and professionalism. Any inference to the contrary is completely wrong. MacArthur never reneged on any commitments to the CNC. The decision on the kind of funding the foundation would consider for us was motivated totally by our tax status.”

As the woman who helped make it possible, Revere expressed regret that what she called a “brave experiment” didn’t last. “I think that they had made progress in a lot of areas and were making a contribution to our news and information environment in Chicago. I would have liked to have seen them succeed. That was what we hoped for with our first grant, and our second grant, and we were hoping for in our work on what would have been a third grant. Yes, I was disappointed.”

Here is the complete text of Revere’s statement:

“The MacArthur Foundation supports the production and distribution of news and documentary programs for television, radio, and the Web that help inform the American public about important domestic and international current affairs and policy issues. We provide grants to about 15 national news organizations ranging from NPR and the PBS NewsHour to Investigative News Network. None of these organizations receives all of its support from MacArthur; many receive far less than $500,000. In no case do we monitor or get involved in any editorial decisions at these organizations.
 
“We provided early support to the Chicago News Cooperative (CNC), awarding its first grant very quickly in order to help it make its deadline to start publishing in The New York Times. We did so because we believed it was important to back an experimental new model for substantive local news coverage, however risky that model might have been. Since CNC started in 2009, we provided a total of $1 million in grants. We were working on a renewal grant to CNC when it notified us that it was closing. While we had not yet recommended a specific amount, whether our funding came in the form of project support or general support would have had no bearing on the size of our grant.
 
“CNC had other funders, both national and local. We do not know whether any of them were asked for emergency support. We do know that CNC was testing different approaches to raising revenue in addition to foundation grants. The slow economy may have contributed to the lack of immediate success of some or all of those efforts.
 
“We are sorry to see the CNC come to an end in its present form and hope that it is successful in maintaining some elements of its work in the future. MacArthur is committed to continuing our 30-year history of support for non-profit journalism because informing the American public matters as much now as it ever has.”