Anyone in Fort Lee, New Jersey will tell you that Gov. Chris Christie can be venal and vindictive, and I certainly won’t argue the point. But sometimes he can be right, even if his motives are less than inspirational.
This is one of those times. The governor has embarked on a crusade to end the long tradition of legally mandated notices that New Jersey taxpayers must purchase in their local newspapers of record. The newspapers are screeching that Christie is pursuing this goal in retaliation for their coverage of the Bridgegate scandal. I suspect they are correct, but that doesn’t mean the governor does not also have a point.
New Jersey is far from alone in mandating these old-fashioned legal notices. Many states require them to alert interested citizens to a variety of happenings at the local courthouse. Typically, such advertisements are required in connection with zoning and other development requests, foreclosures and tax sales, probate proceedings and other administrative esoterica.
These ads are not free, and usually they are not cheap, either. According to The Wall Street Journal, Newark spent about $200,000 on legal notices last year; a survey of 146 New Jersey municipalities found that they collectively spent about $1 million on such placements. In many cases, private citizens and businesses must also purchase such advertising.
These ads are a guaranteed source of revenue for the publications entitled to receive them. Now that the internet has decimated most other forms of classified advertising, publishers rely on these notices more than ever – though they have always jealously guarded their legal monopoly, even before online competitors were a major threat. In most places, such ads must be placed in a “general circulation” newspaper, which is usually defined in a way designed to exclude the free “shoppers” that go by names such as “PennySaver.”
Of course, this reliance on a government-granted monopoly for monetary support tends to make newspapers beholden to local politicians, who have been known to remind publishers of this fact. Only rarely, however, have they explicitly threatened to withdraw the perk, and it is even rarer for any of them to act on it. Infuriating your local newspaper publisher has never been a shortcut to political success.
One reason this system has persisted so long is that, initially, such advertising at least arguably performed a public service. In the late 19th and early 20th centuries, many people lived on farms and in small towns, far from county courthouses and other seats of government. It was not practical to rely on just a bulletin board as a means of public notification. Local newspapers tended to have a high “penetration rate,” as the industry calls it – most households subscribed, as did any business or organization that needed to stay informed of local government activity.
But this rationale has dissolved. Newspaper circulations continue to decline, and many papers have already gone out of business. Most millennials who read this column won’t even know what I am talking about; they have probably never seen a legal advertisement in a newspaper in their lives. And, of course, social media and the internet completely eliminate the public service rationale behind the notices. If I want to stay informed of happenings in my county or village, the local government need only provide a website, a Facebook page and a Twitter feed. It can post all the notices anybody could ever want, and notify anyone who might ever care, all for virtually no cost. For what it’s worth, the legal ads placed in all New Jersey newspapers are already available online today.
Rich Vezza, the editor and publisher of The Star-Ledger, argued that it could cost towns and cities more money to publish notices online than in local newspapers, once the cost of hosting and maintaining a basic website was factored in. Even if this highly unconvincing proposition were true, the proposed legislation would only remove the requirement that municipalities buy legal notices; they can still pay for newspaper space if that is the method they prefer. I wouldn’t advise Vezza or other publishers to count on it, however.
Christie has correctly pointed out that most people access such information online (doing so, incidentally, in an online opinion column freely accessible to New Jerseyans and anyone else who is interested). Unfortunately, the legislation – which was first suggested in 2004 – faces yet another delay. Assembly Speaker Vincent Prieto, the bill’s lead sponsor, could not raise the 41 votes needed to pass it, and so removed it from the agenda last week. New Jersey’s lawmakers will revisit the issue next year. Christie spokesman Jeremy Rosen said it would be one of the governor’s top priorities in early 2017.
Whatever Christie’s motives, he is also right: The state-mandated legal advertisement is both an unnecessary burden on the public and an unwarranted freebie to a segment of the media that has no right to expect the state to mandate that we buy its advertising space. Legal notices and other government-mandated advertising have lost their purpose and ought to be relegated to the morgue where other ancient newspaper clippings are stored.
Palisades Hudson Financial Group (www.palisadeshudson.com) is a fee-only financial planning firm and investment manager based in Scarsdale, NY, with more than $1.1 billion under management. Branch offices are in Atlanta, GA; Austin, TX; Fort Lauderdale, FL; and Portland, OR. Read Palisades Hudson’s daily column on personal finance, economics and other topics at http://palisadeshudson.com/insights/current-commentary.