Lawmaker defends Google deal to fund California newsrooms, as labor criticism grows

The California legislator at the center of a first-in-the-nation deal between Google and the state to help fund local news organizations and an artificial intelligence accelerator project defended the agreement from critics who said it didn’t go far enough.

The $242.5 million deal has led to the demise of Assembly Bill 886, authored by Democratic Assemblywoman Buffy Wicks, which would have made Big Tech pay for news that appears on its platforms in perpetuity.

Wicks, in an interview with The Sacramento Bee, said the public-private deal represented the best of what was actually achievable, and called it a win for California journalism.

“This is, from my perspective, the beginning, not the end of this,” she said from Chicago, where she is attending the Democratic National Convention.

The deal calls for $242.5 million to be distributed to California media over a five-year period, Wicks said.

Of that money, $180 million will go to a 501(c)(3) nonprofit, under the auspices of the University of California Berkeley School of Journalism, with oversight provided by a board made up of members of the California News Publishers Association, or CNPA, Ethnic Media Services, Local Independent Online News, Latino Media Collaborative, California Black Media and the Media Guild of the West.

Of the $180 million, $110 million will come from Google and its tech partners, and $70 million will come from the state, Wicks said.

The final framework agreement, shared by Wicks’ office, calls for Google to pay $15 million for the journalism fund in 2025 and a minimum of $10 million a year through 2029, for a minimum total of $55 million. The state would pay $30 million in 2025 and then $10 million a year through 2029, for a total of $70 million. Additional funding will go toward “existing journalism programs” for a total of $180 million, according to the agreement.

Those funds would be distributed to qualifying California news organizations, using a framework cribbed from AB 886 to ensure that money goes toward journalism jobs and not corporate profits, she said. Twelve percent of that funding would be reserved for locally focused publications and outlets serving under-represented groups and news deserts.

Then, $62.5 million, which is exclusively tech money and includes no state funds, will go toward creating a nonprofit to administer an AI accelerator project, for a grand total of $242.5 million.

Wicks envisioned AI being used to make school boards and city and county governments more accessible to journalists and the public, much as CalMatters’ AI-infused Digital Democracy project has done for the Legislature.

She acknowledged the concern shared by many journalists that AI could be used to replace them in their work. While she didn’t list any specific safeguards that this nonprofit would employ, she did say, “The goal of this is to provide technology that will provide solutions to challenges instead of creating more challenges.”

The $70 million coming from the state has yet to be appropriated.

Wicks said that it will be subject to next year’s budget negotiations, but that she has received assurances from California Gov. Gavin Newsom, who crafts the state budget, that the money will be included in it. And as chair of the powerful Assembly Appropriations Committee, Wicks will have her own tools at her disposal to make sure the money is there, she said.

Asked about the possibility of future deficits, or even a recession, Wicks said she was confident that “the amount of money per year is doable from a budgetary point of view, even in a deficit year.”

While Wednesday’s announcement was greeted with enthusiasm from Wicks, the governor and both journalism and Big Tech executives, it was met with strong pushback from organized labor in California.

Speaking from the Democratic National Convention in Chicago, Lorena Gonzalez, California Labor Federation boss and Wicks’ predecessor as Assembly Appropriations chair, told The Bee: “You cannot save an industry with a policy proposal that the workers in that industry are adamantly opposed to.”

She added, “And when you lead with AI, and we’re not even sure what it means, are you kidding me?”

Gonzalez criticized Newsom for being too “enamored” with the tech industry.

“Unfortunately … we have a governor who wants to speed up, who wants to accelerate AI. He believes somehow that this is the future,” she said.

Gonzalez called AI an “existential crisis” for many working journalists.

“I think that the governor has always loved technology and innovation and Silicon Valley, and I think that, yes, I do think he’s siding with all of those factors over rank-and-file workers,” she said.

Matt Pearce, president of the Media Guild of the West—which would be part of the board that administers the money—said his organization, which was a champion of AB 886, was frozen out of the talks that produced the deal.

“Not a single organization representing journalists and news workers agreed to this undemocratic and secretive deal with one of the businesses destroying our industry,” Pearce wrote in a memo to union members, calling the arrangement a “backroom deal.”

Pearce has said the agreed-upon figure is much lower than what would have been provided under AB 886.

Wicks defended her decision not to include Pearce, who had been critical of the deal-making process, in the talks.

“Ultimately, the decision was: Do we want nothing, or something?” she said. “From my perspective, a nearly quarter-billion-dollar framework was better than zero.”

Pearce blasted Google in a text message to The Bee: “This whole settlement is a massive get out of jail free card for a monopoly with an illegal business model.”

“But if it’s going to happen anyway over the protests of journalists, and if taxpayer dollars are now going to go to large employers like Alden Global Capital, Los Angeles Times, McClatchy and CalMatters, then those employers need to have collective bargaining agreements in place with those journalists. The public shouldn’t support private companies that don’t support their own journalists,” Pearce wrote.

The CNPA, of which McClatchy and its California-based newspapers—The Sacramento Bee, The Fresno Bee, The Modesto Bee, Merced Sun-Star and San Luis Obispo Tribune—are members, released a statement of qualified support for the deal.

“We appreciate the effort to bring together resources from both the public and private sectors to support local journalism,” CEO Charles Champion said. “However, we believe that the financial commitments from Google and other tech companies should have been more robust, given the substantial revenues they generate from the distribution of journalistic content.”

Julie Makinen, who chairs the CNPA board, added, “There were ambitious legislative efforts over the past two years to put local news in California on a stronger financial footing. We always knew that getting legislation passed, signed, and implemented would be an uphill battle.

“This is not what we had hoped for when we set out, but it is a start, and it will begin to provide some help to newsrooms across the state. More must be done, and we are committed to working on that.”

Wicks said her bill and one pending by Democratic Sen. Steve Glazer—Senate Bill 1327, which would create a tax credit to pay for journalists—had uncertain futures in the Legislature.

“Both represented some serious challenges,” she said.

Glazer declined to comment.

While both bills passed out of their respective houses with strong support, Wicks said she didn’t think SB 1327 could even make it out of the Assembly Revenue and Taxation Committee (where it currently sits), much less pass off the Assembly floor and be signed by Newsom.

Newsom’s office declined to comment when asked whether the governor would have vetoed either bill, assuming they made it to his desk.

As for AB 886, Wicks said that even if Newsom signed it into law, it would face “endless years of litigation” from the tech industry. She said that’s exactly what has happened with other bills she’s authored to take on Big Tech.

“Policy is about the art of the possible, and so I think this is what it represented,” she said.

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