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News CEO Jim Moroney on His Decision to Close the Paper's Southern Dallas Facility

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When A.H. Belo Corporation released its third-quarter financials on Friday, included high in the press release was this note: "As part of the Company's ongoing efforts to realign its business and reduce expenses, The Dallas Morning News will close the packaging facility as it consolidates production operations into a single facility located in Plano, Texas. This consolidation of production facilities should be completed in the first quarter of 2010. The Company has begun the process of marketing the packaging facility for sale."

The facility in question is the "post-press and distribution" center located near the intersection of Interstates 20 and 45 in southern Dallas, which only went online in the summer of 2007; perhaps you saw Rudy Bush's follow-up, in which City Manager Mary Suhm said of the plant's March 31 closing, "It's sad. We're working hard at increasing the tax base and the quality of life in southern Dallas." Council member Tennell Atkins, in whose district the plant sits, also was not pleased, especially given the fact The News received tax abatements from the city that it has promised to return.

Several Friends of Unfair Park have wondered about the irony of the announcement -- since, after all, the paper has made a self-proclaimed "crusade" out of "Bridging Dallas' North-South Gap." Which is why, just as editorial writer Tod Robberson was posting his position on the announcement, I sent News publisher and CEO Jim Moroney a note asking for his thoughts on the closing of the southern Dallas facility. Moroney, who ultimately made the decision but was not quoted in his paper's piece, responded with a lengthy note Monday night. It follows after the jump.

I am glad we could improve this acreage and help stimulate others to locate in this area. At the time we made the decision no one knew the kind of ad revenue loses that would cut across all major metros in the past three years. We have made many tough choices over the past few years and the toughest of all this year: layoffs, salary cuts for all including 15% for highest paid folks, reduction in benefits, closed our mid cities based commercial printing facility and merged its operations into our north plant. We also proved earnings by signing more commercial print and delivery contracts like The WSJ. We signed a co-distribution deal with "frenemy" ADVO.  And of course we raised the price if home delivery by 43% and single copy by a third daily and 50% in Saturday.

Ad revenues have continued to be down as our earnings release indicated. So I very reluctantly had to make this cost savings decision. This opportunity has always been available to us and as you can tell from the foregoing, it was one of the  last major moves we made. We wish it wasn't necessary but the focus and priority is on preserving the scale of our newsroom now. It will save over a million dollars a year and eliminate only a very few jobs. So better this than broader downsizing.

Fundamentally we are in the business of bringing to light important issues for our city and helping to stimulate the public discourse around these issues. We don't often make financial investments that align with our position on issues just as we don't participate in partisan politics or make donations to campaigns or ballot issues. However make no mistake about it, putting our packaging

Operations at our north plant would have been a lot less costly than locating it in southern dallas. So I was glad we were able to do it when we did. This move concentrates our resources [in] our core competency: publishing local news and information.

We will continue our "bridging the north south gap" unabated.

Jim Moroney
Publisher and CEO
The Dallas Morning News

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