November 12, 2019
Nonprofit soon will own county’s only newspaper
The Piedmont Journalism Foundation plans no immediate changes in the newspaper’s operation or staffing, according to President “Bo” Jones, former publisher of The Washington Post.
The goal here is to get information to people who live in the county . . . and to keep that up.
— Piedmont Journalism Foundation President Boisfeuillet “Bo” Jones Jr.
1905 — Thomas Frank of Warrenton founds The Fauquier Democrat.
1936 — Hubert Phipps of The Plains buys the newspaper and three years later builds new office at 39 Culpeper St.
1974 — Arthur W. “Nick” Arundel of The Plains buys “The Democrat” and over the next decade expands his company to 17 Northern Virginia newspapers.
2013 — Two years after his father’s death, Peter Arundel of McLean buys out other family members’ interest in newspaper.
2013 — Newspaper office building sold to real estate investors.
2014 — Dropping “Democrat,” name changes to The Fauquier Times.
2016 — Newspaper sold to Piedmont Media LLC, which George Thompson of Marshall and other local investors formed.
2019 — Piedmont Journalism Foundation takes ownership for $1,000.
In a last-ditch effort to save the county’s only newspaper, the owners of The Fauquier Times essentially have agreed to give the weekly to a journalism foundation based in The Plains.
Founded last year, the Piedmont Journalism Foundation will pay Piedmont Media LLC $1,000 for The Fauquier Times, The Prince William Times, a group of specialty magazines and the company’s websites, according two sources.
Over just more than three years, investors put approximately $2 million into the newspaper company, according to sources.
Landon Butler, who helped manage Piedmont Media and headed its board, declined to discuss the details of the deal or the company’s financials.
But, the managers and a majority of its shareholders agreed that it would be in the company’s and the community’s best interest to transfer the publications to the nonprofit, Mr. Butler said.
Some newspapers large and small across the country have shifted from “profit” to “nonprofit” models and have done so with apparent success, he suggested.
Mr. Butler, who worked for President Jimmy Carter and headed a real estate investment firm, expressed confidence in the foundation.
“I think it’s going to be good,” said the Rectortown resident, who spoke about financial and other challenges facing traditional media companies in the internet age.
Piedmont Media’s nonprofit status would allow the “community” to help support the company through tax-deductible contributions, Mr. Butler said.
Transfer of Piedmont Media to the nonprofit will take place in the “next few days,” Piedmont Journalism Foundation President Boisfeuillet “Bo” Jones Jr. said in a phone interview Tuesday afternoon.
Discussions between the foundation and media company started a few months ago, said Mr. Jones, who worked for 32 years at The Washington Post Co., serving as the newspaper’s publisher and CEO and vice chairman of the parent company
The ability to accept tax-deductible contributions could produce a new and sustained infusion of cash, he suggested.
“It’s way to generate revenue for a paper or media group beyond what it can raise” through advertising and circulation income, Mr. Jones said.
Piedmont Media will operate as a wholly-owned subsidiary of the foundation, the Markham resident said.
In the “foreseeable” future, he anticipates no changes at the company, whose existing staff will continue to oversee day-to-day operations, Mr. Jones said.
“We’re a small organization,” he said of the foundation. “For us, it’s a matter of Piedmont Media figuring out what they want to do.”
The foundation’s three-member board includes Mr. Jones, attorney Georgia Herbert who lives near The Plains and Jessica Matthews, a former think tank executive. The organization has no staff. Mr. Jones declined to discuss its finances.
“They’re going to keep their organization the way it is,” he said of Piedmont Media. “They’re going to keep their own board.”
The foundation will support the company and local journalism, explained Mr. Jones, noting it funded and provided at no cost to Piedmont Media in-depth stories on rural broadband and the opioid crisis.
The foundation also shared the opioid crises series with Fauquier Now.
And, it will continue to “supplement” local media coverage with “in-depth” journalism, Mr. Jones said.
“The goal here is to get information to people who live in the county . . . and to keep that up,” he said.
Many of the company’s approximately 45 stockholders, who put millions into the company’s 2016 purchase and operation, first learned about the transaction last week.
Warrenton resident Les Cheek, who bought 15 shares at $1,000 apiece, got the news in a phone call last Thursday from Piedmont Media LLC board member Trevor Potter.
In a 15-minute conversation, Mr. Potter summarized a single-spaced, 7-1/2-page memo that explained the reasons for effectively giving the company to the foundation and the financial problems that plague it, Mr. Cheeks said.
Mr. Potter told him that all investors would receive by mail a packet of a one-page cover letter, the memo and two “consent” documents that required the signatures of shareholders who backed the transaction, he said.
Depending on circumstances, he and other investors will have an opportunity to write off “capital” losses related to investments in Piedmont Media on federal and state tax returns, Mr. Cheek said.
“Most of” the memo “consisted of what we all know, which is the headwinds for print journalism are very strong in a negative direction,” he said. “And, that basically the investors and managers had basically exhausted their capacity to raise any more funds for the paper in its current business model.”
The memo also refers to the national decline in newspaper advertising revenue, dropping from $50 billion in 2000 to $14 billion today, he said.
The document included no details about the media company’s cash flow and expenses, he said.
But, it does refer to the company’s efforts to reduce substantial losses.
During the first six months of 2018, the company lost $201,893, Mr. Cheek said the memo states. For the same period this year, it lost $22,000, according to the memo.
“The one thing that stands out” about the memo “was the absence of financials. But, I think the narrative itself makes it clear that the paper is not just between a rock and a hard place, but essentially on the verge of going under” without the company’s transfer to the nonprofit.
Despite cost-cutting moves, “the paper remains in a precarious financial condition, almost literally operating week to week based on the management of receivables,” according to the memo.
More than three years ago, George R. Thompson, who lives near Marshall, organized, helped fund and recruited investors to purchase the publications from Peter Arundel for $1.2 million. The group subsequently invested hundreds of thousands of dollars in computers, software, a phone system, new staff positions and other areas.
The late Arthur W. “Nick” Arundel bought The Fauquier Democrat in 1974. In the 1990s, Mr. Arundel changed the newspaper’s name to The Fauquier Times-Democrat, to bring it into alignment with his group that once included 17 publications. Two years after Mr. Arundel’s death in 2010, his eldest son Peter bought out other family members’ ownership interests.
When Mr. Thompson’s investment group purchased The Fauquier Times in the summer of 2016, the paper’s circulation stood at 9,400. Today, it stands at about 8,400.
Mr. Thompson refused to comment on the Piedmont Media’s ownership transfer to the foundation.
Investors helped purchase the company from the Arundels with the best intentions, Mr. Cheek said.
“If you were to ask 75 percent or 80 percent of those who originally backed (the purchase) why they did it, they would all tell you that it was absolutely vital to have a local newspaper for the sake of keeping tabs on what government was doing and to keep people in the community informed of what was going on,” Mr. Cheek added.
He “would have loved to have” realized a big profit on his investment, John Richardson of Delaplane said.
But, “I didn’t invest on that assumption,” said Mr. Richardson, who declined to say how much money he put into the company.
“The effort was to preserve a newspaper devoted to Fauquier County and improve it.”
What does he think about the quality of journalism produced during Piedmont Media’s three-year ownership of The Fauquier Times?
“I think there was some improvement,” Mr. Richardson said. “I think there could have been more. There can always be improvement. And, different people are going to have different ideas as to how things ought to be improved.”
Contact Don Del Rosso at Don@FauquierNow.com or 540-270-0300.
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Charlotte · November 12, 2019 at 4:58 pm
Congratulations Bo Jones....can't wait to share the good news with Willem.
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