Kessler

Washington state is in the media spotlight after Gov. Chris Gregoire signed into law a 40 percent business-tax reduction for the state's newspaper industry. "Obnoxious Newspaper Bailout Begins," says Silicon Alley Insider -- asking, essentially, why the state is rewarding a flawed business model with a tax break.

Internet search guru Danny Sullivan also asks why the state isn't including online news sites. "If the intent was to promote journalism, shouldn’t any outlet that publishes journalism have gotten the break?" he asks.

The intent was, in fact, to help traditional print newspapers, said House majority leader Lynn Kessler, the prime sponsor of the bill, when we reached her by phone this afternoon. In general, she said, bloggers haven't yet proven themselves as valuable to the public interest as newspaper reporters have. At the same time, she didn't deny the existence of legitimate online journalism.

"It's not print vs. the Internet," she said, acknowledging that bloggers have been credentialed to cover the state government.

However, she added, "I want to make sure our press is trained, held accountable and serves as the ears and eyes and voice for us. And that's what I think the newspapers have to provide."

The law says the reduction in the business-and-occupation tax will apply "to every person engaging within this state in the business of printing a newspaper, publishing a newspaper, or both."

But what about online-only news operations? Apart from such widely read sites as the West Seattle Blog and MyBallard, the region has a high-profile example in SeattlePI.com, the continuing Web site of the former Seattle P-I newspaper.

"They're not making money," Kessler said of SeattlePI.com, suggesting that the tax wouldn't apply anyway.

However, it turns out the B&O tax is on gross receipts -- revenues, not profits -- beyond a relatively small minimum amount. So the tax would presumably apply to SeattlePI.com.

Pressed on whether the tax break should apply to online news sites, Kessler said she didn't have an immediate answer. (TechFlash, for the record, is a unit of the Puget Sound Business Journal. Kessler said the PSBJ would qualify under the language of the tax break.)

Overall, Kessler said she considered it important to help newspapers with a tax break in the same way the state has helped Boeing and other companies and industries.

"Anybody who's blogging, God love 'em, they can say and do whatever they want, because they have no liability or responsibility for what they say, because they are not held to any standard, and they shouldn't be -- they're just individuals editorializing, if you will," she said.

"The actual newspaper reporting is meant to be -- and I know people argue about whether it's biased or not biased -- but it's meant to get information to the public, and to make sure that our government is held accountable for decisions that government makes, and that the stories that are written are accurate, and they can get this information out to a broad section of our community," she said.