Archive for November, 2008

Sunday | Nov. 30 | Got news, or a question?

November 30, 2008

Can’t find the right spot for your comment? Post it here, in this open forum. Real Time Comments: parked here, 24/7. (Earlier editions.)

It takes a village: How an employee gets laid off

November 30, 2008

Cutting loose a single employee can require a three-member team: their immediate supervisor; an H.R. representative, and someone from IT. The supervisor and H.R. deliver the bad news in a private meeting, explaining severance terms and other details. While this is going on, an IT worker is likely shutting off access to the computer network. (In some cases, a fourth employee might be assigned to pack the worker’s personal possessions, to be handed to them as they leave the building.)

Suppose this process takes 30 minutes per worker. A three-member team could handle 16 layoffs in eight hours. But what if it’s a bigger paper, with more cuts to make — like The News-Press in Fort Myers, Fla., where the publisher has already warned of about 80 layoffs? One team would need 40 hours to run through that many people, so there would likely be several teams, working simultaneously.

Earlier: Questions to bring to a meeting where you’ll be laid off

[Image: today’s News-Press, Newseum]

As layoffs near, charity that doesn’t begin at home: Foundation pours more cash into execs’ pet causes

November 30, 2008

Gannett is about to launch one of the industry’s single-biggest newspaper layoffs, so I figured it was time to update my reporting on Gannett Foundation gifts to charities favored by company executives. (Who knows? Maybe we can save some jobs if someone in charge realizes there are other ways to economize.) The following is based on the foundation’s just-filed 2007 tax return, which I received Friday under the federal Freedom of Information Act.

As CEO Craig Dubow (left) imposed draconian budget cuts last year, the company’s charitable arm — the Gannett Foundation — made an unusual gift: $20,000 for scholarships at Western Carolina University in Cullowhee, N.C. It was one of the foundation’s single-biggest direct grants of 2007, and followed an identical $20,000 gift the year before, public documents show.

The gifts were unusual for several reasons. The Gannett foundation’s website says it won’t give money to endowment funds; the two grants were for an “endowed scholarship,” the foundation’s tax returns shows. Also, the foundation’s stated mission is to help non-profit groups where Gannett owns a newspaper or TV station. The closest GCI business is 53 miles away: the Citizen-Times in Asheville, N.C.

But Western Carolina had a powerful ally: Dubow himself. He is the foundation’s chairman and president, and one of its seven unpaid officers, all Gannett employees. As Gannett’s CEO, Dubow is among a handful of current and former executives allowed to steer foundation money to favorite charities — often, charities including religious groups that would be ineligible under rules applying to regular employees and the public.

Sure enough, Dubow recommended both $20,000 gifts, the foundation’s new tax return shows. Last year’s grant was among $320,000 awarded to charities recommended by Dubow and 15 current and former executives — including some of the highest-paid brass, an analysis of the tax return shows. The 2007 grants were on top of $724,000 the foundation gave in 2004-2006 to charities favored by executives.

Unseemly ‘philanthropy’
There is nothing illegal about any of this. The grants were made under a little-known perquisite that Gannett says is meant to attract and retain top executives. Under the benefit, the foundation imposes fewer restrictions on donation requests from top management compared to requests from average employees and the public. For example, these direct grants didn’t require any matching money from the executives — unlike a similar program for regular employees, GannettMatch.

Based on last year’s giving, each executive got $20,000 in what amounts to play philanthropy money. All of it appears to have gone to non-profit groups. I suspect many other big companies offer a similar benefit to top executives. Plus, the $320,000 last year was just a fraction of the overall $11.3 million in grants approved.

Yet, with a mass layoff coming this week at papers including Florida’s News-Press in Fort Myers, spending on executives’ pet charities is at sharp odds with Dubow’s claims of fiscal discipline and shared sacrifice.

Besides, there’s something unseemly about sending foundation money to charities far from Gannett communities — at the same time GCI is reducing employment and news coverage in those same places. Why didn’t these 16 executives give their $320,000 in earmarked grants to the company’s Employee Disaster Relief Fund?

It’s not even clear whether Gannett is getting credit for all its gifts. Consider the $40,000 to Western Carolina University. The tax return says the money went to an “endowed scholarship,” rather than to, say, a general-use scholarship fund. Scholarship funds typically offer naming rights.

I asked foundation Executive Director Tara Connell which fund received the money. I asked WCU, too. I look forward to their replies. (Connell is also Gannett’s spokeswoman. Read her objections to my last report.)

The Dubow scholarship fund?
Meanwhile, I searched WCU’s website, but turned up just one reference to the Gannett Foundation, a $3,270 grant to a theater group in early 2003. Then I found a page showing a “complete listing of WCU scholarships.” But Gannett and the Gannett Foundation do not appear anywhere on the page. There is, however, a scholarship listed under the names of Dubow and his wife:

“Craig and Denise Dubow have established an endowed fund to provide scholarship support for deserving students at Western Carolina University. This scholarship provides support for full time undergraduate students from Jackson, Macon, and Transylvania counties who demonstrate financial need and maintain a B average.”

More than likely, this amounts to an out-of-date list on a website or some other innocent omission. The Dubows probably established and funded the scholarships on their own, using their own money. In fact, the return’s GannettMatch section shows the foundation matched an unidentified employee’s $10,000 gift; that could have been from Dubow, ponying up for his own fund.

But until I hear back from Connell and WCU, I still don’t know how the Gannett Foundation received credit for its $40,000 in direct grants. There’s reason to be curious: Last spring, I found at least two examples where foundation money went to other scholarship funds named after executives — rather than Gannett or the foundation. (Updated at 10:41 a.m. ET, Dec. 1: A WCU spokesman has now referred my questions to the the school’s fund-raising office.)

More liberal rules
The direct grants to endowed scholarship funds at WCU and elsewhere are made possible because of the more liberal foundation rules for the executives. For anyone else seeking support for their scholarship fund, the foundation’s website says: “The only scholarship program currently funded by the foundation is the Madelyn P. Jennings Scholarship Program for children of Gannett employees.”

Gannett provides all the foundation’s funds. Periodically, it donates a newspaper to the foundation, which then sells it, and reinvests the proceeds in stocks and other investments. That’s what happened to the Chronicle-Tribune in Marion, Ind., which Gannett sold last year via the foundation for $12.3 million. It had been a Gannett paper for 36 years.

More executive-directed gifts
Other noteworthy Gannett Foundation direct grants given last year on the recommendation of current or former executives. Each person directed a total $20,000 to charities of their own choosing.

Earlier: How to examine a non-profit’s tax returns

Please post your replies in the comments section, below. To e-mail confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.

[Image: today’s News-Press, Newseum. The paper is expected to lay off up to 80 of 600 employees in the next week]

Other noteworthy grants directed by top execs

November 30, 2008

Following are some of the other $320,000 in Gannett Foundation direct grants given in 2007, on the recommendation of 16 current and former company executives. Each executive directed a total $20,000 to charities of their own choosing.

Gracia Martore
Gannett’s chief financial officer, a major architect of the current round of layoffs, directed $15,000 to her alma mater, Wellesley College near Boston. Gannett doesn’t own any papers or TV stations in Massachusetts.

In the GannettMatch section of the return, I noticed the foundation gave an additional $15,000 to Wellesley, in the form of an employee matching grant. The return does not identify the employee; it’s possible that it is Martore. In any case, the 2007 money brings to at least $60,000 the total direct foundation grants to Wellesley since 2004.

Also at Martore’s request, the foundation gave $2,500 to the exclusive Potomac School in McLean, Va., home to Gannett’s headquarters. The K-12 school’s tuition starts at $24,340 a year for kindergarten, and tops out at $27,445 for grades 9-12.

Craig Moon
USA Today‘s publisher recommended two $10,000 grants. One went to Young Life Williamson County in Tennesseee; the other, to the Heritage Foundation of Franklin and Willamson County. (Moon was publisher of The Tennessean in Nashville before USAT.)

The foundation gave $30,000 to Young Life in 2004-2006. The group’s website says: “Whatever the setting, every Young Life gathering or event is intended to give kids the chance to experience God’s love and to consider the relevance of Jesus Christ for their lives.”

The foundation’s guidelines for regular employees and the general public prohibit gifts to “programs or initiatives where the primary purpose is the promotion of religious doctrine or tenets.”

Doug McCorkindale
The retired chairman and CEO once more favored charities that included Columbia College, his alma mater; it got $3,000. The foundation gave $16,000 to Columbia scholarship funds in 2004-2006, including one named for McCorkindale.

John Curley
The foundation gave the entire $20,000 to Pennsylvania State University, where the retired Gannett chairman and CEO now teaches journalism. That brings to $80,000 the total direct grants Curley has directed to Penn State since 2004.

Dave Lougee
The foundation made two $10,000 gifts on the TV division president‘s recommendation. One went to Futures for Children in Albuquerque, N.M. The second went to Project Vote Smart in Philipsburg, N.M.

Larry Miller
The retired chief financial officer’s recommendations included $5,000 for Gospel Volunteers/Camp of the Woods in Speculator, N.Y., a “Christian family resort and conference center” in the Adirondacks. On its website, the group says: “The mission of Gospel Volunteers Inc. is to present the Biblical truths of Jesus Christ, develop Christian leaders, strengthen the faith of individuals and families, and promote global evangelism.” (Noted: the list of summer 2009 speakers.)

Earlier: How to examine a non-profit’s tax returns

Please post your replies in the comments section, below. To e-mail confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.

Sheboygan: Sex-offender mug shots tell a story

November 30, 2008

A montage of mug shots occupying most of the front page shows all 272 convicted sex offenders in Sheboygan County, Wisc. It illustrates a fine Sheboygan Press story today, analyzing the demographics of sex crime perpetrators.

Nearly 70% of the cases involved crimes against children, the Press‘s Eric Litke found. His story is the first in a two-part series that includes a searchable online sex-offender database. (It looks like the Press didn’t publish cutlines, identifying each of the 272 photos; judge for yourself, with this more readable view.) Photo illustration by Sam Castro and Gary C. Klein, Press, via Newseum.

I’m flat-out amazed that the Press and Litke dared to even take on that package. I once reported on dozens of county jail guards at The Courier-Journal in Louisville, Ky., who were escaping punishment for workplace infractions that included deliberately beating inmatess. We ran mugs and bios of the five worst cases — all of them still on the jail force. After the story ran, one of them called me and left a specifically threatening message — on my voice mail! And he got off! This kind of work is hard and dangerous. Kudos, Sheboygan!

Cutlines Only showcases Gannett website art. To e-mail suggestions confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.

Saturday | Nov. 29 | Got news, or a question?

November 29, 2008

Can’t find the right spot for your comment? Post it here, in this open forum. Real Time Comments: parked here, 24/7. (Earlier editions.)

Urgent tech call: Here’s what the spammer is doing

November 29, 2008

(Updated.) Thanks for the feedback! I’m still on guard, but now I’m better informed.

I write this with some trepidation: The comment spammer attacking this blog just tried to post a comment, repeated nearly 50 times, that looked like this:

javascript://chicken little

I’ve rejected them all. Now, it appears the spammer is sending e-mail designed to trick me into turning over my Blogger and Google account passwords, so they can take control of this blog. I am not a tech expert, so I’m growing concerned.

This mischief is at least a reaction to my posting Gannett newspaper profit margins yesterday. It also follows some nasty business last weekend involving an investigation by the U.S. Justice Department, the F.B.I., and Google into a reader’s anonymous comment that they had “brought a gun to work but decided not to use it.”

A question: Is that computer code above — or just gibberish meant to look like code? Please post replies in the comments section, below. E-mail confidentially via gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.

Reader: Paper gives work to managers to avoid OT

November 29, 2008

In an e-mail to me, the reader describes “highly unethical if not illegal” H.R. practices at their Gannett newspaper. I’m withholding the paper’s name to protect the writer’s identity:

I think the ratio of salaried managers to hourly employees is off the charts. Lower-middle managers at our paper spend an incredible amount of time producing the paper. Most of them perform their actual scheduling and managing duties at the end of a 10-12 hour day producing the paper. These production duties often extend into six and seven-day weeks, especially during holidays and vacations, as the paper doesn’t want to give holiday pay to hourly workers, so they pressure managers to cover the shifts. Its ugly and miserable.

Does this happen in your workplace? Please post your replies in the comments section, below. To e-mail confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.

Spam attack requires me to OK your comments

November 29, 2008

(Updated.) For the first time, this blog has been attacked by a comment spammer, or group of spammers, unhappy about my post on profit margins at Gannett newspapers. The spamming subsided early today, after starting soon after I published the original post yesterday afternoon. But as a precaution, I’ll continue reviewing all comments before they’re published. This slows comment publishing a tad, and creates a bit more work for yours truly, but I’m not going to let the site get overwhelmed. And, as always, I appreciate your support.

How Phoenix is dragging down Gannett revenue

November 29, 2008

The Arizona Republic was one of the company’s biggest revenue and profit gainers, as the state’s especially frothy housing boom drove millions of dollars in new advertising to the Phoenix paper — until the bubble collapsed last year.

The Republic‘s total ad sales rose to $498.1 million in 2006, up 7% from $467.1 million in 2005, internal Gannett documents show. As a result, the paper’s share of all company newspaper ad sales grew to 9.3%. And its profit margin stood at 29.76% at the end of 2006.

But through the first three quarters of last year, Republic ad sales fell 13%, to $319.2 million vs. $367.6 million during the same period the year before, the documents show. Meanwhile, the paper’s profit margin dived to 25.43%.

I don’t have current data for 2008. We know, however, that the Republic was hit even harder this year as the real estate bust intensified — joining papers in Florida, California and Nevada, now pulling down Gannett’s overall revenue and earnings.

Please post your thoughts in the comments section, below. To e-mail confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.

[Image: yesterday’s front page, Newseum]