The Jersey City Independent"

Public notice legal ads have long been a moneymaker for local newspapers, and they’ve helped keep many afloat in recent years as traditional display and classified advertising have dwindled. (One publisher last year told me, grimly, that the housing bubble’s implosion — and the rash of public notice ads for foreclosures that followed in her Midwestern town — was a godsend to her weekly newspaper, keeping it viable as it grappled with the recession.)

Ironically, the very force that has led to many publishers’ newfound appreciation for the legals — the recession — has led New Jersey and other states to explore ways to save money by cutting the middle man — the newspaper publishers — out of this equation.

A bill allowing municipalities and other government agencies to post legal notices online instead of in newspapers unanimously cleared a crucial Senate committee Monday. And given the state’s fiscal clampdown and the cost-cutting at all levels of government, the bill may have the best shot of passage it’s had in years.

This proposal is not new to New Jersey — it has been around for the past three legislative sessions. In 2006, when first introduced, it died on the vine in the Assembly after passing a committee in the lower house. Two years later it passed the full Assembly but failed to gain any traction in a Senate committee.

Now, with powerful state Sen. Brian Stack pushing the bill in the Senate, and with bipartisan support coming out of the Senate Budget and Appropriations Committee, it seems to face a much clearer path to becoming law, although opposition remains.

At Monday’s hearing, Star-Ledger publisher Richard Vezza testified against the measure, saying legal advertising is “an important part of our revenue stream these days,” given the recession’s effect on the paper’s other revenue sources.

The NJ Sierra Club, which also opposes the bill, similarly warns of the negative economic impact in a statement issued Monday.

“Many small newspaper rely on these legal advertisements to keep afloat,” the organization says. “Without them, local newspapers may close, resulting in less scrutiny of local government and a citizen’s right to know.”

The legislation is also opposed by the New Jersey Press Association, which represents many newspaper publishers. The trade group claims, among other things, that putting the notices online will make them less accessible and less readable. In a 2008 memo against the bill, the association argued that “turning on the computer, dialing an ISP, remembering a specific URL to find the site, and scrolling through a computer screen just to see if a public notice has appeared” is an inherently more difficult task than “having public notices packaged in a mainstream product containing relevant, useful and timely community information (news, sports, grocery ads, classifieds, etc.) delivered to your doorstep or mailbox.”

The bill, which sponsors say would save an estimated millions of dollars each year, would require municipalities to pass a resolution each year to publish the notices online, and that particular resolution would have to be published in the local paper.

If passed, the measure could mean further trouble for the struggling Jersey Journal. The paper, which narrowly averted a shutdown last year, charges $6.46 per column inch for legal advertising, which comes out to more than $300 for a full page’s worth (it charges nearly four times as much when it has less than 5 working days notice to place the ad). On most days, there are at least a few pages’ worth of legal ads, and on Mondays and Tuesdays, foreclosure listings tend to push that number much higher. (The day this bill cleared committee, for example, the Journal ran nearly 13 pages’ worth of legal ads.) While $300 a page doesn’t sound like a ton of money, some quick back-of-the-napkin math (300 x 2 x 6 x 52), shows a conservative estimate of annual losses the paper could face climbing above $100,000.

The paper has been reportedly losing money for years (as much as a reported $4 million a year in 2002, the first time this decade the Journal faced threats of closure), but it has benefited from being part of a large, privately held publishing chain, Advance Publications, which has been able to absorb some losses in the newspaper industry given its diverse roster of other publications. (Among other companies, Advance owns Conde Nast, which operates The New Yorker, Vogue, Wired and Glamour — see the full list of what the Journal’s parent company owns here.)

But with Advance’s more traditional cash cows facing tougher conditions as well, the company has begun to shutter some print publications, closing the 170-plus-year-old Ann Arbor News last year.

Meanwhile, Mayor Healy says his administration thinks the proposal is “interesting,” but he by no means is offering an endorsement of the measure.

“We want to figure out the cost savings it would have,” he says, “and the impact it could have on those individuals who are not computer literate or do not have access to computers.”