An attorney for the long-time owner of seven newspapers in Oregon and California has said all but two are for sale. Western Communications filed for bankruptcy in January, triggering layoffs while disclosing millions in back taxes and unpaid debts. A federal judge recently allowed the company to hire a firm that specializes in newspaper acquisitions and mergers.
There isn’t a timeline from the court on selling and the attorney said it’s premature to guess which papers, if any, will find buyers. The papers to be marketed include the Baker City Herald, La Grande Observer, and the Curry Coastal Pilot in Oregon, plus the Del Norte Triplicate and the Sonora Union Democrat in California. These outlets serve communities where no one else consistently reports the news.
According to Kennedy, all the buildings, including printing presses and the headquarters in Bend, are also for sale.
“The view is that the real estate is not necessary to the operation of the newspapers, given the way the market and the publishing industry has evolved,” Kennedy said.
Court filings show Western Communications’ shareholders among its creditors. Insiders have personally loaned the company millions since a separate bankruptcy settlement seven years ago. Other filings detail how company president John Costa has deferred wages, while former president Gordon Black is owed over $2 million for unmet payments to the “Supplemental Executive Retirement Plan of Western Communications, Inc.”
Still, new debts mounted — including millions in back taxes and penalties for not providing health insurance to employees. The balance sheets submitted to the court lump together financials for all seven newspapers, making it difficult to read profit or loss from any single business in the chain.
Employees company-wide have experienced years of layoffs, late paychecks and mandatory furloughs. In January, the motor failed on the 53-year-old press that had long printed the La Grande Observer and the Baker City Herald.
“Without a functioning press, and due to dramatic funding cuts associated with the bankruptcy, The Observer’s pressroom and mailroom departments were laid off,” wrote the Observer.
More than 20 people have been laid off company-wide since January, according to posts from social media, and former and current employees.
Editor’s note: OPB reporter Emily Cureton worked for a newspaper owned by Western Communications between 2011 and 2015.