$61 million in donations help complete Sun-Times sale to WBEZ parent
Executives said the philanthropy is pledged over five years to help the paper improve its journalism, expand digitally and continue the print edition.
Backed by $61 million from foundations and individuals, the Chicago Sun-Times on Monday became part of the parent company of public radio station WBEZ in a venture setting out to strengthen local journalism despite steep losses in traditional revenue sources.
With the closing of the noncash sale of the Sun-Times to Chicago Public Media, the newspaper becomes a nonprofit for the first time in its history. Executives said the philanthropy is pledged over five years and will help the Sun-Times broaden its reporting, expand digitally and maintain its print product.
Chicago Public Media said it will continue raising other funds to ensure sustainable financing for the Sun-Times. It said WBEZ, which is 60% listener-supported, will continue to rely on community funding for its news operations.
Major supporters of the deal include current Sun-Times investor Michael Sacks, the John D. and Catherine T. MacArthur Foundation and the Pritzker Traubert Foundation. But in announcing the deal’s closing, the Sun-Times and Chicago Public Media disclosed more organizations and individuals committing funds.
Matt Moog, CEO of Chicago Public Media, told the Sun-Times the cash infusion will be managed with an “invest and grow” strategy, with a focus on digital growth. The combined organizations have about 300 employees, and Moog said he expects that to expand by 40 to 50 people across all functions. “There will be hiring in virtually every area of both places,” he said.
The $61 million is the largest philanthropic amount committed to local reporting in the U.S. known to the Institute for Nonprofit News, said the group’s communication director, Sharene Azimi.
Rick Edmonds, analyst at the Poynter Institute for Media Studies, agreed that the philanthropic involvement is huge. He compared it to businessman Stewart Bainum Jr.’s commitment of $50 million to a nonprofit news outlet in Baltimore after his offer for the Baltimore Sun was rejected.
Edmonds also said newspapers or their digital sides have partnered elsewhere with public radio stations. “This one takes it to a much higher level,” he said of the Sun-Times-WBEZ union.
Subjects to get greater coverage will be decided by the newsroom leaderships, Moog said in an interview, but he suggested arts and culture and the environment as areas to consider. Both the Sun-Times and WBEZ are in search of executive editors to lead their newsgathering.
In a news release announcing the deal’s closing, Moog said, “The response from the philanthropic community has been tremendous, and we are deeply indebted to this community of donors leading the way to invest in and protect journalism in Chicago. With their support, our talented team will tell the stories that matter and serve more people than ever before with human-centered, solutions-oriented journalism. We aim to connect Chicagoans more deeply to each other, to their communities, and to the issues and solutions that shape their lives.”
Sacks thanked past and incoming investors in the Sun-Times for securing its future. “Together, we have created a model for sustaining local journalism which we know is vital,” he said.
The sale, plans for which were announced in September, creates one of the largest nonprofit news organizations in the country. Together, the Sun-Times and WBEZ will reach more than 2 million people a week and their content can be shared across various platforms, executives said.
Additional donors disclosed Monday were Builders Initiative, Chicago Community Trust, Walter and Karla Goldschmidt Foundation, The Joyce Foundation, John S. and James L. Knight Foundation, Mansueto Foundation, Robin Steans and Leonard Gail, and an anonymous donor.
Some supporters issued statements attesting to their aim of sustaining journalism as a vital source of local information and a bulwark for society. John Palfrey, president of the MacArthur Foundation, said the “collaboration can serve as a national model for addressing the financial crisis in the news industry at a time when our democracy needs it most.”
The Builders Initiative was founded by Walmart heir Lukas Walton. The Chicago Community Trust manages investments and gifts for foundations and family donors. The Mansueto Foundation was started by Morningstar Executive Chairman Joe Mansueto and his wife, Rika. The couple endowed a library at the University of Chicago and a charter school in Brighton Park. The Knight Foundation, drawn from a publishing fortune, backs programs for informed and equitable communities.
“We are excited about what lies ahead for this unique model of nonprofit news and raising the bar for supporting, preserving and strengthening local journalism,” said Nykia Wright, CEO of the Sun-Times. “This day would not have been possible without the perseverance and commitment of theChicago Sun-Times’staff and our board, and tomorrow would not be possible without the support of our funders whose generosity will secure a very bright future for this team. For that, I am forever grateful.”
Wright will report to Moog in the new corporate structure. A five-member board including Moog — but separate from the governing board of Chicago Public Media — will oversee the Sun-Times.
As a nonprofit, the paper can no longer endorse political candidates, but executives said coverage and investigations of politicians will go on as usual. Converting to a nonprofit was crucial to attracting foundation support, Moog said.
Across the country, many newspapers have closed or barely have a presence in their communities as advertising and readership have moved elsewhere. Some, such as the Chicago Tribune, are now owned by hedge funds that have slashed staffs.
The Sun-Times has endured years of financial travails as it passed through several owners and a bankruptcy in 2009. Sun-Times executives said the paper has narrowed its financial losses in recent years, making it an attractive partner for WBEZ.
Since 2017 and until Monday, the paper has been owned by private investors, unions and the Chicago Federation of Labor. Sacks and W. Rockwell “Rocky” Wirtz, owner of the Chicago Blackhawks, later invested. The partnership continued the daily print publication while spending to achieve more digital revenue. The paper added to its editorial staff, ending years of cuts under prior owners.