“Women in Prison” video from nonprofit new site Oklahoma Watch 

Foundations are playing a significant and helpful role in fostering new models for local news. But in addition to money, a little tough love may be in order when looking at prospective journalism grantees. If the grant money doesn’t flow forever, how can a foundation tell if a news organization has legs – or how can foundation help nudge the organization onto a more sustainable path? Here are four key issues to consider:

Here are a few questions to ask before cutting a check.

1. What is your engagement and/or distribution strategy?

These days, any journalist can build a website and start covering the community news. Great. But finding an audience for the content and gaining visibility – and credibility – is a different question. There are different ways to do this.

At one end of the range is an intense focus on engaging a relatively small community – in the case of local sites such as The Rapidian and Oakland Local, engagement may include social media outreach, events and training, as well as a good base of volunteer contributors.

At the other end of the spectrum, you might find a site such as California Watch, which mainly distributes its investigative reporting to hundreds of thousands of people via established news organizations.

Look for both – Oakland Local, for example, distributes content via other news sites; California Watch has a strong social media presence and it sends reporters out to local cafes for conversations that inform its coverage.

Knight Foundation’s recent report, “Getting Local: How Nonprofit News Ventures Seek Sustainability,” details engagement practices of seven larger nonprofit journalism sites. (Here’s my recent post with some highlights.) (Note: I co-wrote the report.)

Bottom line: News and information cannot engage and inform citizens or have an impact on communities if few people create, see, discuss or act on the information. It’s important to determine whether a news organization requesting funding has a plan, as well as the technical capacity to execute the plan. Another approach might be to assure that getting expert help in developing and executing such a plan is part of what’s funded.

2. What is your revenue development plan and who is going to implement it?

Be careful here: Journalists typically are not business people – they will need development and sales expertise to grow revenue. To be successful, news start ups need to be able to look beyond their next grant to developing a strong donor base along with commercial revenue such as advertising or corporate sponsorships.

If a prospective grant doesn’t devote significant capacity to revenue development, it may not have much potential to live on – unless a foundation wants to keep funding it forever or the organization wants to devote significant time to chasing grants, which is not a formula for stability or sustainability.

Ideally, the site’s point person for revenue development has a business background. Most journalists face a steep and potentially lengthy learning curve in this area.

As Knight’s “Getting Local” report emphasizes, an organization needs to balance its resources – too much emphasis on the journalism comes at the expense of business development (and tech capacity) that together create a sustainable news organization. For example, over-emphasis on content was a key factor in the close of one pioneering local news site, Chi-Town Daily News. 3. Is your organization transparent about its mission and who is backing it?

Transparency is essential – visitors to news sites need to be able to put the content in context. For example, is it actually a news site or does it have a political agenda? It’s not that one or the other is bad – just that the funder and the public should have this background.

I believe every news site should publish prominently on the site:

– A mission statement that is specific and clear (Here is an example from MinnPost.

– A list of funders (Example: Oakland Local lists funders and partner organizations).

– Information that is easy to find from the home page about who is in charge of the site and how to contact them. (Here is how The Texas Tribune lists its staff and board of directors. The site also has a contact form.) 4. How do you define journalistic independence?

Beware absolutes. I have had conversations with journalists who maintain that their independence is total and a foundation’s role is to simply provide money. Meanwhile, foundation leaders, mindful of their important role as conveners in their communities, sometimes have a “fear of fire” about the potential ramifications of independent journalism.

I believe in a middle course: A foundation can legitimately fund the organization to cover certain topics – health care, environment, etc. – and the organization must be transparent about this. (Here is a take on this from Mary Lou Fulton at The California Endowment.) The foundation also can require that the site have an advisory board that focuses on content and engagement and can require evidence that the board’s suggestions are being looked and reasonable ones implemented within the overall mission of the site. At the same time, a foundation isn’t (and does not want to be) a publisher – it should not expect to dictate the framing and specific content of stories – who is interviewed, what points are highlighted, etc.

Oklahoma Watch, funded by several large foundations in the state, is a great example. A year ago, Oklahoma Watch partnered with the two major newspapers in the state and other media partners to cover the high rate of imprisonment of women in Oklahoma. The topic was agreed upon by all concerned at the start but that decisions about content would be made independently by the media partners. The idea was that strong, fair journalism would motivate the state legislature to act and underpin separate efforts to lobby for reform. It worked – the state legislature approved a reform package earlier this year.

In an email, Eric Newton, senior adviser to the president at Knight Foundation, said he would like to know more about the “information ethics” of a news organization. In addition to transparency, Newton said he would ask about policies for handling conflicts of interest, the firewall between editorial and revenue/development activities, and how member information is treated.

Newton suggested a good Question 5. What content do they intend to produce, which and for what community and why? “Otherwise we are saying that all news has the same educational or instructional value to all self-governing peoples.”

This is the start of a list questions foundations might ask. I’m sure there are others – What are yours?

By Michele McLellan, crossposted from Knight Digital Media Center