Can Local Television Afford Investigations?

In the predawn hours of October 16, 2006, the home of Benny and Martha Cryer exploded. They had lived in the house, in Wylie, Texas, northeast of Dallas, for fifty-two years, but as frantic neighbors helplessly watched, the elderly couple was burned under flaming debris. Both died.

Five months later the Texas Railroad Commission, which regulates the oil and gas business in the state, filed a report that speculated that utility workers digging near the Cryer house might have loosened an underground compression coupling connecting natural-gas lines, allowing leaking gas to build to dangerous levels. It found the gas company, Atmos Energy, blameless and praised its cooperation.

But in the days after the explosion, WFAA-TV in Dallas began its own detailed investigation. It reached a very different conclusion, as we’ll see.

That WFAA has an investigative unit—one that continues to follow the ramifications of the gas-explosion story in 2010—is something of an anomaly in local television these days. In-depth investigative reporting is under siege on every platform in journalism and particularly in local television, where the majority of Americans still get their daily news. Such reporting is difficult, time-consuming, and expensive, not to mention potential fodder for lawsuits. It is also indispensable to a democratic society, shining a bright light on issues, injustices, and problems that otherwise remain hidden from public view.

Still, it is difficult to measure the return on investment from investigative reporting in dollars or ratings. As audiences and revenues continue to decline in an increasingly fragmented news landscape, even stations committed to quality investigative work must continually ask: Can we still afford it? Here’s how one station makes that calculation.

In a glassy, low-slung building in downtown Dallas, WFAA-TV sits alongside The Dallas Morning News and just a few blocks from the infamous former Texas School Book Depository where, from a sixth floor window, Lee Harvey Oswald fired the shots that killed President John F. Kennedy in 1963. In fact, barely two hours after the assassination, WFAA had the first live interview with Abraham Zapruder, the man who made a home movie of the assault on the presidential motorcade as it passed through Dealey Plaza.

Nearly a half-century later, WFAA-TV, the flagship of Dallas-based Belo Corporation’s twenty local stations, has made a name for itself as a place that believes in investigative journalism and finds a way to support it.

That’s a hard and deliberate decision in an industry that has seen viewership and revenues steadily decline over the last decade, as cable and the Internet have siphoned off audience and advertising. “I know viewership is down,” says Michael Valentine, vice president of news at the station.

“There are many more choices, and it becomes incumbent on us to provide unique and compelling content. The investigative unit is certainly part of that.”

Although its revenue losses are not as steep as some of its competitors, Belo, whose stations generally are market leaders, is hardly immune. It reported that its total revenue in the fourth quarter of 2009 declined 13.8 percent from the same quarter a year earlier, and total company revenues for 2009 were down 19.5 percent against 2008.

After cresting at about $22 billion in 2006, revenue for all local U.S. TV stations, including network affiliates and independents, dropped to $20.6 billion in 2008 and was projected to decline 22 percent more—to $16 billion—in 2009. Still, while it may no longer boast the dizzying 50 percent-plus profit margins it enjoyed until about two decades ago, local television—with news broadcasts driving about 44 percent of its revenues—generally is still profitable. Profit margins range from single digits for struggling stations to between 30 and 40 percent for top performers in large markets. The industry has made hard trims recently to insure it stays profitable, shedding about 1,600 jobs in the last two years, out of roughly 30,000.

When personnel cuts come around, investigative teams often are among the first casualties. Their reporters tend to be some of the newsroom’s most experienced and highly paid, and in some cases the unit is assigned a dedicated producer and photographer. That adds up to the kind of money that many cash-strapped stations well might decide to save or reallocate—no matter how prestigious the unit.

That’s what happened in January 2009 when Roberta Baskin, the last remaining member of the investigative unit at Allbritton Communications’ WJLA-TV in Washington, D.C., was laid off—the day after she won a duPont-Columbia Award for exposing a pediatric dental chain that was ripping off Medicaid and other insurers by doing unnecessary procedures on children. The station said steep personnel cutbacks had left it unable to afford specialty reporting.

Joe Bergantino, an award-winning veteran of Boston’s WBZ-TV and head of its investigative unit, said he left in May 2008 after he was told the station had decided to look at “less in-depth projects.” He became the first director and senior investigative reporter at Boston University’s New England Center for Investigative Reporting.

In Dallas, the ranks of investigative reporters also have thinned, the latest departure being that of Bennett Cunningham from CBS affiliate KTVT last December, reportedly over a management request that he take a five-figure pay cut. He plans to practice law.

WFAA has its own stable of accomplished investigative journalists, including the award-winning News8 Investigates team of reporters Byron Harris and Brett Shipp, producer Mark Smith, and photojournalist Billy Bryant. The station is hardly impervious to the economic pressures weighing on so many stations these days, but WFAA’s management has decided to allocate resources in a way that retains and highlights strong investigative work, and not just during sweeps periods, when ratings are measured, but on a near-daily basis.

Harris, Shipp, and Smith brought home a 2009 duPont-Columbia Gold Baton for a trio of investigations—the first time the award’s highest honor has ever gone to a local television station. That baton gleams on a sunny windowsill in Valentine’s office. He commissioned the investigation into the tragic Wylie house explosion, back in 2006, when he was the station’s executive news director. That story led to a series called “The Buried and The Dead,” one in the package of three investigative series that snagged the award. More importantly, it exposed a potentially deadly threat to thousands of Texas families.

After months spent reviewing reams of documents, interviewing families, and enlisting the help of experts, reporter Shipp and producer Smith discovered that the problem with the gas-pipe coupling near the home of Benny and Martha Cryer was not just an aberration caused by work in the vicinity by another utility, as the official report suggested. Instead, it was symptomatic of a far larger problem, one plaguing thousands of similar couplings and posing the threat of more tragic results.

Mostly installed prior to the 1980s, these compression couplings—connecting the gas main to the service line to the home gas meter—were joined with rubber seals that appeared to steadily deteriorate and weaken over years of cyclical, weather-related expansion and contraction of the soil. Shipp found that the manufacturer of the couplings had long ago warned of their “pullout potential” and had recommended the addition of a cheap part to secure the connection. Called a supplemental restraint, the part would have kept the joints together. But the gas company apparently failed to make the modification.

Moreover, the investigation revealed that the Railroad Commission members, who are elected, received a substantial amount of their campaign funds from the very industries they regulated—which may raise questions but is legal under Texas law.

The WFAA series launched a year after the Cryer house exploded. “And three weeks later the Railroad Commission ordered the removal of the problem couplings that resulted in the Cryers’ deaths,” said Shipp. It is likely that the series and the station’s relentless pursuit of the story saved lives. But, Shipp pointed out, some three million compression couplers still exist beneath the soil across Texas and are being replaced only after leaks are reported or found.

Since the Cryer house blew up in 2006, at least five more houses have exploded, killing two Texans and seriously injuring at least five others. At least four of those explosions were related to faulty compression couplings, according to Shipp. “That story never went away. We could have said we won our award and that’s it. Uh-uh. People are still dying,” said Shipp. He is fifty-one, a tall, lanky reporter and second-generation WFAA-TV staffer whose affable demeanor belies a fierce persistence. He talks Texas, too. “All our stories have legs,” he said. “It just depends if you want to keep walking.”

The WFAA investigative unit scored its first big triumph with the sixteen-part series “Fake Drugs, Real Lives,” which won a 2002 Peabody and a 2003 duPont-Columbia Silver Baton. Shipp and Smith reported that the Dallas Police Department’s spectacular success on drug busts in 2001 was not quite what it seemed. In fact, more than half the total cocaine recovered, and more than a quarter of the methamphetamines, turned out to be nothing more than pulverized billiard chalk or sheetrock. Paid police informants framed dozens of people—primarily non-English-speaking Mexican immigrants, many of them working as mechanics—by stashing the fake drugs in cars at auto shops. The informants collected hundreds of thousands of dollars in rewards, which they shared with their police handlers.

As a result of the News8 investigation into the planting of fake drugs, about two dozen innocent people had drug charges against them dropped. The police officer at the center of the investigation was prosecuted, convicted, and sent to prison. Three other officers were prosecuted and sentenced to probation. For News8, said Smith, “it built a following, it built a viewing audience of people that really wanted to see more.” It also helped further build up investigative reporting as a distinctive signature of the WFAA “brand.”

That is something Mike Devlin, WFAA president and general manager, considers good business. “The war we’re in is against parity. There is a sameness in newspapers. There is a sameness in television. The average viewer says this is all the same,” said Devlin. “Aside from outlandish personalities—and they come and go—strong investigative reporting is one of the key components in fighting this issue of parity, or the homogenization of the industry.”

Shipp and Harris usually follow up on their stories as they develop. That puts them more frequently on the air and also reinforces WFAA’s reputation for investigations. The unit has a lot of latitude on stories—which range from fraudulent autopsy mills and unqualified airline mechanics to pastors using church jets for personal business and local voter fraud. Their story ideas are not always approved, says Harris, a thirty-five-year veteran of WFAA. “I describe us as Labradors. The Labrador is supposed to go get the duck and come back with it. That’s what I do. Sometimes the hunters”—the managers—“say, ‘we don’t like the story—go get another duck.’ ” He does so, he says, because “they’ve got the rifle.”

Harris is sixty-three, a silver-haired, natty dresser with the manner of a slightly prickly professor. He seems to have a particular nose for financial wrongdoing—and is proud of WFAA for allowing him to cover those stories. “God, how many local TV stations do stories about the Export-Import Bank?” he asks.

The very thought of a complex financial investigation would likely induce yawns at many stations. But Harris and Smith pulled off a series about the taxpayer-funded bank called “Money for Nothing,” the second of the three series that earned WFAA the 2009 duPont gold baton. It took a year of hard digging. “We waited eight months just to get the documents to do the story,” says producer Smith. He is fifty-four, a former investigative journalist at the Houston Chronicle and San Antonio Express-News who came to the station in late 2000. An intense, energetic man, Smith gets many of the tips and does much of the groundwork for the dozen or more short, medium, and long-range stories the team may be juggling at any one time.

In an effort to boost U.S. exports, the Washington, D.C.-based Export-Import Bank lends about $12 billion a year to foreign firms seeking to buy American products. The problem, Harris and Smith discovered, was that the bank did little due diligence. Hundreds of millions of dollars in loans were going to nonexistent companies in Mexico—thus the Texas angle—to pay for nonexistent American goods. Much of the money was pocketed by phony “exporters” who fabricated borrowers and suppliers through false applications and fake invoices. When the loans defaulted, the taxpayers picked up the tab—an estimated $243 million between 2003 and 2007 alone.

The bank refused to speak to Harris, but after an eight-month delay, loan documents acquired under the Freedom of Information Act finally arrived. Though sparse, they told a story. Shortly after they got the records, Harris and Smith jumped in a car and made a 1,500-mile road trip in four days, visiting dozens of Mexican “importers” and American “suppliers” embroiled in a swindle that stretched from coast to coast and across the Mexican border. They found that some addresses didn’t exist. They found firms that didn’t make the kind of goods specified on the invoices and companies that had no idea their good names had been stolen. As a result, a San Antonio man was sent to federal prison and one from El Paso was charged in March. Others are still being investigated, and the Export-Import Bank appointed the first inspector general in its history.

“Documents are the key,” says Harris. As he speaks, he sits at a conference table picking through a tote bag crammed with papers, receipts, bills, direct-mail ads, and other items—all related to an investigation of firms that take money from banks to maintain abandoned and foreclosed homes, but then fail to pay the mom-and-pop contractors who mow the lawns and do the maintenance.

Harris, Shipp, and Smith all carry miniature Kodak video cameras—hardly larger than an iPhone—that can shoot video when a photographer isn’t available or discretion is required. And all three are eager to help other reporters in the newsroom with investigations and stories wherever they can. “I’m so old I know who to call for something,” says Harris, with a smile. Having developed an expertise on aircraft, Harris is the newsroom’s go-to source on that subject, as well as financial issues. He and Shipp also often swap scripts with other reporters for critiques.

On the wall of his small glass-walled office, Smith has a large and well-worn dry-erase board covered with long lists of stories that Harris and Shipp are working on or might be—if they pan out. Not all do, even after months of effort, and that is one of the things that makes investigative work costly.

Legal work is another expense. Although the WFAA unit has been fortunate to date, the potential for lawsuits in investigative reporting is as real as the necessity of engaging lawyers to vet sensitive reports, at upwards of $500 per hour—a cost that dampens the investigative appetite of some news directors. The cost of research and the probability of a suit can be factors in the choice of stories, too.

In the aftermath of an investigation of a grade-changing scandal involving basketball players at a local high school, the family of one named student did sue, but the case was eventually dismissed. Called “A Passing Offense,” that series involved a primarily African-American school, South Oak Cliff High School, which took great pride in its winning basketball team. It took more than a year to nail down the facts and convince the teachers—all of them African-American—to go on camera. They described how the head coach and principal had ordered athletes’ failing grades changed to passing to make them eligible to play. As a result of the reports and the ensuing school-district examination, the team was stripped of two state championships, though the coach remains.

“Our station took a lot of heat on that story,” says Smith, recalling angry letters and charges of “yellow journalism” and implied racism. But, he said, the issue was the integrity of the grading system in the school district. The station management never flinched.

It helps that stations know they have Belo’s support for investigative work, says Valentine, gesturing toward the sleek corporate headquarters across the street. Al Tompkins, a veteran broadcast journalist who leads the broadcast and online group at Florida’s Poynter Institute, points out that two of the six 2010 duPont-Columbia winners (PDF) for local television news—KHOU-TV in Houston and WWL-TV in New Orleans—are Belo stations. “That alone says something about what Belo thinks of investigations,” he says.

As economic pressures have increased, the role of the most successful investigative units that remain in local news has expanded deeper into the day-to-day life of the newsroom, and away from an older model of investigative journalists as an aloof elite.

“I can strive to be the best investigative reporter in the country, but there’s a lot of Pulitzer Prize-winners walking around without a job,” said John Ferrugia, an investigative reporter and news anchor at McGraw-Hill Companies’ KMGH-TV in Denver. “I have to provide value-added for my business.” His unit, which won a 2010 duPont-Columbia award, strives to be a resource for the newsroom, conducting seminars on computer-assisted reporting and looking for ways that daily news stories can be enhanced through the unit’s skills.

Phil Williams, award-winning chief investigative reporter at Landmark Media Enterprises’ WTVF-TV in Nashville, is another winner of a 2010 duPont-Columbia Award. A board member of Investigative Reporters and Editors (IRE), he said that he has been encouraging reporters through IRE to think of investigative work as something that can be done daily, even as they address longer pieces.

That represents a change for some investigative units, but it has long been the case with Harris and Shipp at WFAA. “A lot of these units are in their own little world and get on the air three or four times a year. These guys are out in the newsroom and on the air three or four times a week,” says reporter Jason Whitely, who came to WFAA two years ago.

Whitely’s cubicle is just feet away from identical workstations occupied by Harris and Shipp on one edge of the sprawling newsroom. The investigative reporters routinely pitch in on breaking stories when needed, and often their practiced and critical eyes discover unexpected dimensions in otherwise mundane stories.

In December 2007, for example, the quintessential local Christmastime story promised to be that of a six-year-old girl from Garland, Texas, who won airfare and tickets to a Hannah Montana event in New York with a wrenching essay about her soldier father who had been killed in Iraq. It was a heart-tugging story for most, but it bothered Harris. Having embedded with the military in 2003 during the start of the war in Iraq, he had tracked casualties from Texas ever since—and he didn’t recognize the name of the girl’s father.

That was because—as a check by Harris with the Department of Defense confirmed—no soldier of that name had been killed in Iraq. Because of what Harris calls his “legitimized skepticism,” what might have been just a sweet but phony local tale told by a less experienced reporter catapulted into a sad scandal that made the national news.

For stations with the ability and the will to allocate the resources, this may be the right time to consider investigative reporting as a way to engage viewers and, like WFAA, distinguish themselves in their market, says Hank Price, president and general manager of Hearst Corporation’s WXII-TV in Winston-Salem, N.C., and senior director of Northwestern University’s Media Management Center. “This is a great time for a station to say: What are the things we do that are important to viewers? I think people ask that question all the time but they don’t implement it because they’re not willing to say: What are we willing not to do?”

At WFAA, keeping the most reporters on the street and the investigative team working means they may not cover every car crash, house fire, or downed tree covered by all the other stations in town. “At this television station, having an investigative unit differentiates it,” says Valentine, when asked about the cost.

“I think the more pertinent question,” he says, “is what will it cost you not to have one?”

Lisa Anderson is a 2009-2010 Encore Fellow at CJR. She was the the New York bureau chief and a national correspondent for the Chicago Tribune until December 2008.