Opinion: Will Montgomery County Give Tax Dollars to Murdoch’s Fox?
Subsidy is a test of new racial equity and social justice legislation
Editor’s note: The views expressed in MoCo Politics are the writer’s and do not represent the staff of Bethesda Beat.
On Nov. 19, the Montgomery County Council unanimously passed landmark legislation mandating the consideration of racial equity and social justice in all operations of county government.
A week later, the council is due to face its first test in implementing that legislation: deciding whether to grant tax dollars to a company owned by Rupert Murdoch’s Fox Corporation.
On the same day the racial equity bill was passed, four resolutions to fund business incentives were introduced at the council.
One resolution County Executive Marc Elrich submitted called for an incentive to attract Fox Television LLC, currently in the District of Columbia, to relocate to Bethesda.
The incentive totals $500,000 from the county government and an additional $1,000,000 from the state.
In return for the money, Fox Television LLC promises to maintain at least 178 full-time jobs (its current employment) in Montgomery County, execute a lease in the county for 10 years and invest a minimum of $32.5 million at its new location.
If Fox Television LLC meets these conditions, it gets to keep the incentive as a grant. If it does not, the incentive becomes a loan and must be paid back with interest.
These terms are typical of business incentives disbursed by the county government. What’s not typical is the identity of the recipient.
The resolution under consideration by the council states, “Fox TV is a subsidiary of 21st Century Fox America, Inc., which itself is part of the $41.5 billion media conglomerate, Twenty-First Century Fox, Inc. In the DMV region, the company operates WDCA (Channel 20) and WTTG (Channel 5).”
Twenty-First Century Fox, Inc. was a media holding company founded by Rupert Murdoch. It was liquidated after selling many of its assets to the Walt Disney Company. The rest of Twenty-First Century Fox’s assets, including Fox News and Fox Broadcast Network, were acquired by a new company – Fox Corporation, which began operations in March.
Among Fox Corporation’s assets are 28 broadcast TV stations it owns and operates. Two are WDCA and WTTG, which are the subjects of the county’s business incentive.
The excerpt from Fox Corporation’s 2019 annual report filed with the U.S. Securities and Exchange Commission shown below demonstrates the company’s ownership of these TV stations.
WTTG also describes itself as an “owned-and-operated TV station of the Fox Broadcasting Company” on its website, as shown below.
Fox Corporation’s 2019 proxy statement shows that the company’s largest shareholder is its chairman, Rupert Murdoch, who owns 39% of the firm’s voting shares.
Make no mistake: The recipient of this business incentive is not a locally owned company. It is owned by Rupert Murdoch’s Fox Corporation. If this incentive is granted, it means handing over Montgomery County tax dollars to Murdoch.
All of the above is publicly available information and was known when the Elrich administration sent the incentive to the council. Nonetheless, Elrich – who ran as a progressive in the 2018 election – signed off on the incentive. His signature on the economic development agreement reached with Fox Television Stations LLC appears below.
Now we come to the newly passed racial equity legislation, which states in its findings that “the work to dismantle racial and social justice inequity must occur on an individual, institutional, and structural basis.”
For social justice advocates, there are few more dangerous enemies of social justice than Fox. This is the organization that smeared the nation’s first African American president for years through its spreading of “birther” theories, gives xenophobic demagogues like Lou Dobbs and Tucker Carlson a platform, and helped elect and now protects President Donald Trump.
Last year, the company paid $10 million to settle claims of racial discrimination, gender bias and retaliation by its employees. The company has also spent tens of millions of dollars to cover up sexual predation by former Fox News chairman Roger Ailes and its most famous TV host, Bill O’Reilly.
Ask social justice advocates about which tax expenditures best promote racial equity and exactly zero of them would list a six-digit subsidy for Fox.
Elrich has signed an economic development agreement with Fox and sent it to the County Council. His part in this is done.
The council members now face a choice. They can stick to their proclaimed goal of social justice and vote down the Fox subsidy. Or they can vote for it and defend their decision in the next election.
Adam Pagnucco is a writer, researcher and consultant who is a former chief of staff at the County Council. He has worked in the labor movement and has had clients in labor, business and politics.