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Star struck

Copyright 2015

The Arizona Daily Star has become the thinnest of newspaper gruel.

It seems readers have noticed. In 2006, the Star’s weekday circulation was 103,708. It’s Sunday circulation was 161,975. In 2014, the Star’s daily circulation was 77,528, 25 percent drop. It’s Sunday distribution decreased to 124,007, 23.4 percent less. These numbers are from documents filed by Lee Enterprises with the Securities Exchange Commission. Lee owns the Star and many other newspaper properties.

The circulation decreases are happening as the area grows. Pima County’s population in 2006 was 981,110. In 2014 it was estimated at a shade over a million. The message is pretty much the same all over the country: As the population increases, newspaper circulation falls. In Tucson, the trend is a bit more pronounced.

Since 2005, when Lee purchased Pulitzer Newspapers, Lee has struggled to manage its enormous debt. The company purchased Pulitzer at the zenith of the market, just before it suffered losses from Internet inroads and a severe economic downturn. The decline started in 2006. Lee and all other newspapers have not fully recovered. The days of cheerful 33-percent profit margins seem long gone.

Here’s what the company said in last year’s 10K SEC filing: “At September 28, 2014, the principal amount of our outstanding debt totals $804,750,000. At September 28, 2014, our debt, net of cash, is 4.7 times our 2014 adjusted EBITDA, compared to a ratio of 4.8 at September 29, 2013.” (EBITDA stands for Earnings Before Interest, Tax, Depreciation and Amortisation . It is a measure of operating income. It does not include debt service, of which Lee has in abundance. Last year’s 10K said the company spent more than $30 million to service its debt.

A recent company news release said Lee had paid off a portion of debt from the Pulitzer purchase two years early. The balance of the payment was made to BH Finance LLC, a subsidiary of Berkshire Hathaway Inc., which is controlled in large part by Warren Buffett, the investment genius and of late a fan of Lee Enterprises. There was a balance of $9 million left on the loan. Mary Junck, chairman and chief executive officer, according to the release, said the reason for the early pay-off was “the company’s strong performance and substantial cash flows.”

The value of Berkshire Hathaway’s 88,863 shares of Lee stock is about $270,000, a modest investment for a company whose shares sell for more than $214,000 each. Thus Berkshire Hathaway’s investment in Lee is equal to fewer than two of its own shares.

Lee’s 10k makes no other mention of debt held by Buffett & Co. It reported that three banks hold the paper: Deutsche Bank ($400 million), JP Morgan ($250 million) and Wilmington Trust ($150 million).

On Februrary 1, 2005, The Associated Press reported this badly written story:

“Lee Enterprises Inc. is buying Pulitzer Inc. — publisher of the St. Louis Post-Dispatch founded by famed newspaperman Joseph Pulitzer — in a $1.46-billion deal that Lee says would give it the nation’s fourth-biggest roster of daily newspapers.

“Davenport, Iowa-based Lee said the acquisition would make the company fourth in numbers of U.S. daily newspapers with 58 dailies in 23 states. Lee has 44 daily newspapers in 19 states.

“Lee will pay $64 a share in cash for Pulitzer, which owns more than 100 weekly newspapers, shoppers and niche publications.

“Pulitzer shares rose 56 cents to $63.46 on the NYSE. Lee shares rose 64 cents to $44.55 on the NYSE.”

Today, Lee’s share price is a bit over $3.

In 10 years, Lee has managed to retire around $600 million in debt. I can only guess how much it has cost to service and renegotiate the debt. It appears in bits and pieces amid the rubble of its 10K filings.

Obviously, the company is struggling. It’s market cap is but $186 million. This means that the company owes about four times more money than it’s worth. According to Yahoo Finance the stock’s short ratio is about 9 percent. This means about 9 percent of its shareholders are betting the stock will drop.

After years — make that decades — of speculation, Gannett — Lee’s partner in Tucson — shuttered the Tucson Citizen in May 2009. The two companies benefitted by eliminating Citizen newsroom and newsprint expenses.

Speculation on the Star’s fate today is sparse if not absent. So allow me to fill the void. There is an economic argument for Gannett to buy out its Tucson partner. Gannett’s Phoenix operation includes the huge Arizona Republic and a TV station. If it were to acquire the Star, it could reduce Tucson production costs by printing the Star in Phoenix. It could consolidate newsroom and advertising expenses.

The Republic’s other — and perhaps more appealing — choice would be to buy the Star and kill it. That would permit it to publish a Tucson edition of the Arizona Republic. Its statewide dominance would be nearly complete.

If that seems a bit cynical, consider what Hearst did when it owned the San Antonio Light and bought the San Antonio News-Express. Hearst killed the Light. No sense publishing two papers when one will make more money.

While we’re on the topic, there once was a time when idealism had a role in newspapers. There was much to be said about the nobility of the free press, the First Amendment and (quoting Joseph Pulitzer) “comforting the afflicted and afflicting the comfortable.” But the good intentions and idealism have gone the way of the buggy whip, yielding without much of a peep to the ways of the balance sheet and the vagaries of profit and loss.

Nowhere is this picture more vivid that in Lee’s depressing predicament. It is the squeeze mode, coaxing every penny from the expense column. It has put the historic Post-Dispatch property in downtown St. Louis up for sale. Lee announced a round of cutbacks in St. Louis as well. Seems the new squeeze is on in anticipation of huge debt payments due in 2017.

It may come to pass that the company can pay its debt only by selling some newspapers — even at bargain prices. The Star might be one of the more valuable properties, and go a long way toward retiring its great debt. It would be preferable. The Star has been squeezed so much that it is barely alive.


Regarding this $800 million capital bond issue being proposed by Pima
County guvment and reported in today’s Star: $160 of this capital is supposedly to repair roads. I have but a fleeting notion of finance, but “repair” is normally classified as a maintenance item, which is an expense as opposed to a capital investment. Accountants scream like maniacal banshees when you mix maintenance expense with capital investment. You’re not allowed to used debt to finance expenses. Believe me when they scream, they’re loud. This is basic Accounting 101. Why then are the banshees imitating church mice when it comes to this bond issue?


Any one noticed that the Star’ editorial page has shrunk by a half page? There’s no pretense to editorials — as those reprinted from Bloomberg and the Washington Post. The Star runs columnists in that space and has relegated the half page space for advertising.


Department of cutsey-stupid newspaper leads:

By Zack Rosenblatt, Arizona Daily Star

April 19, 2015

 “We’re not so different, you and I.”

It’s a line uttered by Dr. Evil in the first “Austin Powers” movie.

It’s probably how Bobby Hurley’s first conversation with Sean Miller will go, too.

Kidding, of course, but it’s true — Hurley and Miller are not so different ….

Such a kidder. Who’s the evil one?


Dear guv doogie:

Why do you want 200,000 Arizonans to lose their health insurance. Have you no soul?


Dr. Kildare


Greetings guv doogie:

Congratulations on your RV tour. Apparently you call it the “Opportunity Express.”

“I’m proud of the work we’ve done and the path forward we’re paving to a better Arizona,” you say. We don’t see a whole lot of forward motion in your reign so far. You’re about as backward and regressive as a corn cob in the outhouse.

What on earth can you possibly be proud of? Often opportunity depends on how much you can afford to pay for a university education. In that sense, seems like your RV would be more accurately named the Screwmobile.


Slats Grobnik


Murder with impunity

At first I started to write a letter to the editor of the Star. I wanted to ask whether the paper would follow up on an article in today’s edition on page A2 written by Kimberly Matas about the murder last May of  31 year-old Jose Luis Arambula. Arambula was killed by Border Patrol agent Daniel Marquez. The agent was cleared of  wrong doing in a letter written by the chief criminal attorney for Pima County Kelli Johnson and released this week.

I realized a letter would be a waste of time. Nobody cares if Border Patrol agents murder Mexicans or other Hispanics. It’s done with impunity.

According to Matas’ report, Arambula was fleeing from his Jeep, which contained marijuana. He was in a pecan grove down in Green Valley.  Arambula had no weapon, but twice turned toward the BP agent, formed a shape of a gun with his hand. You know, they way kids do.

According to Johnson the county attorney’s mouthpiece, Arambula’s mime act, shooting his hand, would persuade a jury that the BP agent was justified in killing Arambula. The jury would, as Johnson was quoted in the Star, “conclude that Agent Marquez reasonably believed that deadly force was immediately necessary to protect himself from Mr. Arambula’s apparent attempt to use deadly physical force.” (Love that phrase “deadly physical force.” It’s so bureaucratically redundant, as though there might be such a thing as “deadly nonphysical force,” maybe “maybe “deadly mental force”?)

BP agent Marquez fired his weapon nine times at the hand jive deadly force exhibited by the fleeing Arambula. For heaven sake, nine times? At somebody’s back? One of the nine shots landed behind Arambula’s ear. Nine shots? For a guy who has no weapon? And a jury will conclude, according to the county attorney, that it’s just fine and dandy — shoot him dead, blow him away, he aimed his hand at you.

None of this makes sense. Wave your gun hand, and you die. The Star story didn’t say whether Arambula was a U.S. citizen or where he was from.

Doesn’t matter. He had dark skin. Nobody gives a shit.

It’s what this country has come to. Just forget about it, and keep your hands to yourself.

Or they will kill you.


David Fitzsimmons

Note: I wrote this little tribute to Fitz in the fall of 2011. Recently when my website went fubar, it was dropped from the database by a company that cost me lots of misery and money, HostGator. In any event, this piece is as I wrote it. There is an album of Fitz photos that you will find here.

David Fitzsimmons has raised millions for Tucson’s charities for a quarter century. He has not given money, but his time and talent. He has been the provocative and entertaining master of ceremonies at thousands of charity-raising event, from chicken dinners to overflowing   auditoriums Fitz is there — thick black drawing pen in hand, big pad of paper and easel at his side and a joke at the ready.

Unless he is already booked, he will not say no. Fitz will stand and amuse. For free. Any time as long as the cause is noble, the audience tomato-free and there are a few big names in attendance that can besmirch, belittle, beguile and charm.

He has been the evening’s entertainment since he returned to Tucson in 1986 and began his career as the editorial cartoonist for The Arizona Daily Star. He was born in Merced, but was but a few months when his parents brought him. He went to Rincon High School and then to the University of Arizona where he majored in several subjects, but mostly he was cartoonist for the Wildcat. He graduated and found a job as an artist for the Oklahoman of Oklahoma City.

He migrated east, finding gainful employment as an artist with the Virginian-Pilot of Norfolk, which was then piloted by a mutual friend, William G. Connolly.  Bill was previously with The New York Times. Eventually, he returned to the Gray Lady as an editor and co-wrote the paper’s style manual.

After his stint with that paper, Fitz landed his first full-time cartoonist job with the Daily Press of Newport News, Va. His boss at that paper was the late Tony Snow who went on to become press spokesman for George W. Bush. He died of colon cancer in 2008 at the age of 53.

I interviewed Fitz and his daughter sometime in 1985 in the coffee shop of the Sheraton Hotel in Reston, Virginia. She was active, climbing steps. He said he was anxious to get back to Tucson.

Since then, Fitz has been a part of what critics still call the “Red Star,” his cartoons poking fun at, praising, satirizing and annoying. That is the chief reason, I believe, he has never been selected as Tucson’s man of the year. When I was at the Star, we waged a serious campaign to make it so. Alas, we were not successful.

But Fitz nonetheless charges onward, pen in hand, masterfully conducting the ceremony and raising the money — battling breast cancer (he is a cancer survivor), promoting books or paying tribute to long-time heroes such as Big Jim Griffith. He has given many times over his fair share to the community.


A Great Grande Tragedy

DSCF0614When I first started as a reporter at the Arizona Daily Star, I had not quite acquired a taste for the red. I had been a green chile fan. I still am. But nothing rivals a good bowl of red chile, and the place I first encountered Nirvana in the form of chile colorado was in 1971at the Grande Tortilla Factory, 914 N. Grande. My city editor, Bill Waters, showed me the way.

The GTF was but a five minute drive from the paper, which was on Stone Avenue, downtown where it belonged then and belongs today. The red chile burro was absolute perfection, wrapped in  the perfectly formed flour tortilla. The beef was as tender as a Hoagy Carmichael ballad. The gravy of meat juices and chile was a combination beyond what I thought humanly possible.

Of course, the GTF was not just about red chile. It was about all things comida Mexicana. There was a long line at lunch time. In late summer, the factory was busy grinding masa for tamales.  On the weekends, customers cued up with big pots in hand, waiting to be filled with menudo.

I have heard the carne seca was a legend unto itself. It was, alas, my misfortune to never discover it. I could never order beyond red.

The GTF is closed now, the windows shuttered. Every time I pass by, I wish the same wish — that it be 1947 and Frank Pesqueira is about to open for the first time.

But he does not. It’s still closed, a tragedy far greater than even Shakespeare could imagine.

Lacey Jarrell’s Shrine

I know of no more heart-rending roadside shrine in this state than Lacey Jarrell’s. It lies at the side of a hill along River Road. It’s easy to miss except for the red flower bouquet on a thin green post. This is where she died. She rolled her car coming round the bend on River west of Swan. Her story was superbly told by the Star’s Tom Beal in an article that appeared seven years ago. To read it is to weep. She was 16.

Jarrell was driving. Much too fast. She missed the big curve.

It was a mistake.

When you reach a certain age, the mistakes pile up. And when you think about them, they begin to resemble Everest. When you put them in a greater context, they can seem like blessings.



Jeff Smith, in memoriam

Jeff Smith ranks among the most talented writers you could find in Tucson’s  newspaper history. Some stories about his work are the stuff of legend.

It is said that Frank Johnson, the Star’s managing editor, stopped the presses and ordered many copies destroyed when he read a review by Smith, who test-drove cars and wrote a Saturday column. Smith said one car — a very fine one, evidently — was “auto-erotic,” a phrase that unpleased Johnson.

There is another story about a particularly attractive woman who was summoned to give evidence in a trial. Smith, the story goes, wrote that so-and-so testified in court “wearing a hound’s-tooth skirt three teeth long.”

The report that Smith, 67, died this week at his home just outside Patagonia reminded me that I had heard from him last year about a piece that appears elsewhere in the amalgam of flotsam rippling across this site. It was regarding a heavily researched piece on Abe Chanin, a long-time Tucson newspaperman for the Arizona Daily Star. Smith and I worked for Chanin in the 1970s on the Star’s editorial page. Chanin was our friend, and a great teacher.

I did not thank Smith for the comment. I regret that. Here is what he wrote:


jeff smith says:

November 28, 2012 at 2:31 pm

as a friend and employee of abe’s at the star editorial page in the founding day’s of the ‘red star’ i can only thank you for this stroll down memory lane. a job well done. i think the best that can be said of a print journalist is that day-to-day, week-by-week he left his town a better place to be. sounds common, is common, but what could be better? i never knew a more thoroughly moral man than abe chanin. i loved working for him, with him, loved him then, loved him still.


Abe Chanin will be 91 this year. He lives in Albuquerque.