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Last fall, the Humboldt County Economic Development Department hired the North Coast Journal to run a campaign called “Humboldt’s Best Companies to Work For Promotion.”

The contract, obtained by the Outpost through a Public Records Act request, was signed on October 21 by the Journal’s general manager, Melissa Sanderson, and by Humboldt County Economic Development Director Scott Adair. The terms were as follows: In exchange for $6,700 from the county, the Journal would provide a range of services, including:

• Hosting and maintaining thehumboldtsbest.com website,
• Managing all marketing and promotion materials while working with industry partners throughout the promotion,
• Advertising in the North Coast Journal, North Coast Trader and northcoastjournal.com, and
• Sub and organizing promotions third party vendors
• Final sponsored content feature In North Coast Journal In Jan. 2021.
  

The Journal appears to have fulfilled its obligations. The website is up and running, a series of ads regarding the campaign has been published, and the paper’s January 28th edition featured a glowing profile of North Fork Lumber, a subsidiary of Schmidbauer Lumber in Eureka. 

The Korbel-based business “must be doing something right,” freelancer Meg Wall-Wild reports, because in a recent anonymous survey of employees from dozens of local businesses, North Fork Lumber performed so well that “it catapulted the company to the designation of being the county’s best employer.”

The Economic Development Department had paid the Journal to conduct the survey and deliver a “sponsored content feature,” and this one appears to fit the bill. However, it wasn’t labeled as such. The story was published in the Journal’s news section, with no indication that the Journal had been paid to produce it. 

Contacted by the Outpost on Thursday, Journal News Editor Thadeus Greenson said no one in the editorial department, including himself, was aware of the paper’s contract with the county before or during the reporting, writing and editing processes, and he stood by the North Fork Lumber story as a product of his department’s independent journalism.

“[T]here are internal issues we at the Journal need to work out to make sure something like this doesn’t happen again, and that advertising and paid content are always clearly labeled,” he wrote in an email.

Greenson said he has “pushed back” against advertorial or sponsored content before.

“A number of times when it has come up in department head meetings, someone brought it up as a potential revenue source,” he told the Outpost. At conferences for the Association of Alternative Newsmedia, of which the Journal is a member, other outlets have revealed that they’ve embraced “sponcon,” Greenson said, but the Journal‘s editorial staff has steadfastly resisted — “to the point where, the last couple times it’s been broached, [the other department heads] said, “‘We know you guys hate this idea, and we know it’s gonna be shot down but … ,’” Greenson recalled.

Al Tompkins, a senior faculty member at the Poynter Institute, a nonprofit journalism school, said the concept of maintaining a divide between the advertising and news departments is considered sacrosanct in most journalism circles. 

“The code of ethics from the Society of Professional Journalists is premised on the idea that you can’t buy news coverage, and you can’t prevent unfavorable news coverage by spending money,” Tompkins told the Outpost by phone on Friday. “The public needs to be able to depend on a certain amount of independence that happens journalistically, that you will report stories without fear or favor.”

That code of ethics he referenced says journalists should “distinguish news from advertising and shun hybrids that blur the lines between the two. Prominently label sponsored content.”

For the record, the Outpost was also contracted by the county’s Economic Development Department to publish sponsored content. The resulting “landing page” on our website can be found here, under the label “Sponsored Content.”

In light of the Journal‘s contract, and the lack of a “sponsored content” label, some readers might wonder whether the paper can fulfill journalism’s watchdog role in relation to county government when the county is allowed to buy space in the news section.

“The public should be able to trust that just because someone’s buying an ad or paying a bill, they don’t get favoritism,” Tompkins said.

As best Greenson could recall, the idea for the Jan. 28 story was floated during a department head meeting. Sanderson brought it up “with some involvement from Kyle [Windham],” the Journal’s sales manager, Greenson said. They told him they had a deal to conduct an anonymous survey of local business employees and wanted to know if the editorial department would be interested in writing about the results. 

“I said, ‘If we have autonomy to write whatever we want about the findings, yeah, I imagine we could find something interesting and newsworthy,’” Greenson told the Outpost.

The resulting story is unfailingly laudatory. It says “the commitment that North Fork has to its workforce” can be gleaned by its generous employee benefits packages, which include “a 401k match of 4 percent and profit sharing, as well as a holiday turkey, gift cards and company jackets” — plus a 25-pound bag of meat once a year for every worker, “which not only benefits their employees but also Future Farmers of America exhibitors and the local farming community.”

The story concludes by saying, “Oh, and North Fork Lumber is hiring. Those looking to join the team can contact Human Resources Manager Crystal Eckhardt at ceckhardt@nflmill.com or call (530) 739-2102.”

In a sidebar published alongside the story, Greenson explained the background of the story this way:

With the help of local chambers of commerce and business organizations, the survey was administered through the Journal’s marketing department with the results then passed to the Journal’s newsroom, which had complete editorial control in writing about them.

The fact that the resulting article wound up perfectly matching the intent of the county’s promotion — “Humboldt County’s Best Companies to Work For” — is an unfortunate coincidence that gives the appearance of a blurred line between the advertising and editorial departments, Greenson said.

But he reiterated that that wasn’t the case — at least from his perspective. Could his department have chosen to run no story at all regarding the results of the survey?

“Yeah, that was my understanding,” Greenson said, though he added that he’d made it clear to Sanderson that if enough businesses participated in the survey (and “a few dozen” did so), he was confident that something story-worthy could be found in the results.

Asked about the perception of independence, given the transaction that occurred, Greenson said, “While it appears based on what you’re telling me that the county may have thought it was buying space in the news section, I don’t feel it actually did because I never felt directed to make sure a certain thing was in the newspaper. I feel like our news department has never shied away from covering the county or filling that watchdog role. That certainly didn’t change because we ran a feature news story on North Fork Lumber.”

Could the Journal‘s news staff have chosen to write about the worst local business to work for? Or to analyze the methodology of the survey?

Greenson believed that the choice was up to him and his department — “100 percent,” he said. He was genuinely surprised by how positive most of the participating companies fared overall, he said, and in reading the employee comments that accompanied the numerical results, he was struck by the generous and unusual benefits given to employees of North Fork Lumber Company — especially those big bags of meat. 

“I thought, ‘That’s colorful and interesting. Let’s do that,’” Greenson said. He added that he’d been equally open to the possibility that they’d find something darker in the data, like a category where many Humboldt businesses were falling short, or perhaps a well-known local business “just getting dragged by its employees.”

Of course, while Greenson may have been open to that type of story, that’s not what the county paid for or what the Journal‘s general manager agreed to deliver. Adair was quoted in the Journal saying he wanted to “highlight and recognize employer excellence,” and the contract between the county and the Journal, executed three months before the story was published, makes the promotional intentions of the campaign clear.

The website that the Journal agreed to host and maintain, thehumboldtbest.com, now features North Fork Lumber Company’s corporate logo beneath a headline reading “Best Company To Work For” in large typeface. Scroll down and you’ll see the Journal‘s profile of the company reproduced in its entirety above a grid with logos and links of the financial backers, all of which are business associations or chambers of commerce save the Journal and the Humboldt County Economic Development Department (which has been rebranded GoHumCo).

At the end of our conversation, Greenson asked the Outpost to forward a copy of the contract. About an hour and a half later he sent some more comments via email:

Reviewing the contract you provided makes clear to me there are internal issues we at the Journal need to work out to make sure something like this doesn’t happen again, and that advertising and paid content are always clearly labeled.

I want to reiterate that when I agreed the results of the employee survey were something we would write about, I was unaware this story was part of any work contracted by the county. Had I understood that, I would have refused and said it needed to run clearly labeled as a paid advertising feature. That said, once I agreed the editorial department would produce a story about the results, no one outside the editorial department had any input or control over the content of the article. This process was inherently different than for the Rodeo Guide produced by the Journal or other paid promotional pieces, all of which are always clearly labeled.

Since coming to the Journal in January of 2014, I have always pushed back against sponsored or advertorial content because I believe it blurs the lines between what is paid for and what is independently produced by our editorial department, jeopardizing reader trust. I believe that the appearance of a conflict of interest can be as damaging as an actual conflict. We clearly need to take steps to ensure something like this does not happen again.

The contract for “Humboldt’s Best Companies to Work For Promotion” was struck during a shaky financial period for the Journal. Greenson was recently quoted in a Time magazine story about how the COVID-19 pandemic is “ravaging” local newspapers. The Journal’s newsroom briefly shrunk from five employees to just one full-timer and one part-timer as advertisers pulled out or closed.

“There was a point early on where we didn’t know — there was major doubt about whether we would survive this as a company,” Greenson told Time. 

In this week’s issue, Journal Publisher Judy Hodgson reveals that there were layoffs and furloughs in other departments as well, and the paper reduced circulation and printed “far fewer pages than normal each week” to cut costs. A loan from the CARES Act Payroll Protection Program put the Journal back on firmer financial ground, Hodgson writes, though she adds that Sanderson “completely revised” the paper’s budget multiple times last year, including in September “and probably November.”

If there was a revision to the Journal‘s budget in November, the revenue column would have included $6,700 for a promotional campaign that included sponsored content.

Briefed on the broad strokes of this situation, Tompkins said, “My heart goes out to an editor who’s having cards dealt behind his back. … It’s a heck of a position to be in to try to do the right thing, thinking you have independence, and then it has the smell of being for sale.”

The way to move forward, he suggested, was to have training within the organization. “Part of the education that has to happen is between whoever’s doing sales and the customer to make sure the [customer] understands that there are no promises for content,” Tompkins said. “But it has to be part of your culture [as a company] that people who advertise with you understand that they’re not buying news. It should be in the sales contract. It’s an education process, honestly.”

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[Disclosure: I worked for the Journal from 2008 through 2013 and before that worked in the same newsroom as Greenson at the Times-Standard.]

[Note: This post has been updated to include links to the Outpost’s own contract and sponsored content.]