Owner of MEDC Media Contractor Gave Late Donation to Democratic Mayoral Candidate Taylor
PAUL SCHUTT IS the co-founder and co-CEO of Issue Media Group—a Detroit based media company which creates a number of online magazines including Ann Arbor’s ConcentrateMedia.com. Schutt gave a late donation to mayoral candidate Christopher Taylor in the amount of $500.
The Society of Professional Journalists’ Ethics Committee has tackled the question of whether media professionals should donate to political candidates: “Skeptics of journalistic objectivity are quick to point out that some publishers and owners of news media outlets may not follow the rules they lay down for their employees. A few get more deeply involved, and they may contribute to candidates. Is this ethical? It’s at best a double standard, and a questionable practice. But at the very minimum there should be public disclosure — in their own media—when media magnates get politically involved in this way.”
In 2013, the Los Angeles Times gave prominent coverage of a $750 donation to a mayoral candidate by the publisher of the Los Angeles Daily News: “Jack Klunder, publisher of the Los Angeles Daily News, has contributed $750 to lawyer and former radio talk show host Kevin James in his bid for this year’s mayoral race. But Klunder said the contribution won’t affect how the newspaper makes its endorsement decisions.”
The Atlantic published a feature article about the political donations (and persuasions) of Jeff Bezos, publisher of the Washington Post: “Bezos has also given to several candidates for office, predominantly Democrats. Democratic Senators Patty Murray and Maria Cantwell of Washington have been the biggest recipients of his donations. He’s also given to Senator Pat Leahy, a Vermont Democrat; Rep. John Conyers, a Michigan Democrat; Republican Spencer Abraham of Michigan; and Republican Slade Gorton, a former senator from Washington. He also given regularly to a PAC run by Amazon, which has roughly split its contributions between the two parties over the last 10 years.”
Schutt’s July 27 donation raises questions about his Ann Arbor online magazine’s coverage of the mayor’s race. In addition, one of Schutt’s “sponsors” in Michigan is the Michigan Economic Development Corporation (MEDC). Former Ward 5 Council member Carsten Hohnke, who endorsed Taylor in his candidacy and donated to his campaign, as well, is employed by the MEDC.
Ned Staebler, who ran for state representative in 2010 and lost, endorsed and donated to Taylor’s campaign. Until the election of Rick Snyder, Staebler was also employed by the MEDC. He is now a Vice President of Economic Development for Wayne State University.
Schutt’s company Issue Media Group is a media contractor for the MEDC. Schutt’s latest $150,000 contract is dated April 1, 2014 and expires March 31, 2016. In exchange, Schutt agrees to “generate Michigan business stories. Upon generating these stories, Contractor will provide MEDC with a monthly spreadsheet that will populate the Small Business Association of Michigan jobs ticker….”
The Ann Arbor Observer reported in 2011: “Schutt’s former company, The Collective, had contracts with the Michigan Economic Development Corporation as far back as 2001. Quasi-independent but supported by state and federal funds, the MEDC paid The Collective $484,665 in 2001 and 2002, primarily for building websites and doing tech work. As late as 2004, the year Schutt sold The Collective, it received $86,000 for website maintenance and $19,500 for a ‘Cool Cities workshop.’… All told, MEDC funded IMG to the tune of $1.4 million between October 2006 and October 2009.”
In that 2011 piece published in The Ann Arbor Observer titled “Happy Talk,” Paul Schutt told reporter Michael Betzold “that his publications keep “a very bright line between [advertising] and editorial … [sponsors] do not get to tell us what to say.”
The present contract between the MEDC and Schutt’s company requires interviews conducted by Schutt’s online publications in Michigan (ConcentrateMedia.com and Metro D) to answer a list of questions including:
“Are you evaluating business growth or expansion in the next six months?” and the contract calls for the Issue Media Group to provide between 1,000 and 1,250 stories “with complete basic data.”
The MEDC is not the only Michigan economic development entity contracting with Paul Schutt’s company to produce content aimed at “highlighting” economic development successes. Ann Arbor SPARK’s most recent marketing plan calls for Schutt’s Concentrate Media to produce PR and “news features” about “entrepreneurial companies supported by LDFA and SPARK.”
The Local District Financing Authority (LDFA) is expected to divert $1.4 million in public money from the Ann Arbor Public Schools in 2015. The LDFA uses that money to pay for contracted services from Ann Arbor SPARK. Ned Staebler sits on the Board of the LDFA.
Christopher Taylor will vote on whether SPARK should be given money from the city’s General Fund for marketing. He will also vote on whether the LDFA’s ability to capture school taxes should be extended for 15 years when it expires in 2015.
Schutt’s donation is small, but its implications loom large for those who question Ann Arbor SPARK’s reticence to have its job creation numbers audited. Taylor has said he is “eager to hear both sides” on the question of an audit.
