Google has participated in a $250 million agreement aimed at providing support to newsrooms in California.

A plan for a five-year deal to help California newsrooms would be paid for by Google, state taxpayers, and possibly philanthropies.

The agreement entails $70 million from the state, subject to legislative approval. Some legislators objected, advocating for a more comprehensive solution involving tech companies.

A proposed five-year deal to support California newsrooms is set to be funded by Google, state taxpayers, and potentially philanthropic organizations. Credit... Jason Henry for The New York Times

Google, a news industry trade group, and key California lawmakers announced a groundbreaking agreement on Wednesday, aimed at bolstering newsrooms in the state with up to $250 million.

The five-year deal would combine funding from Google, taxpayers, and potentially other private sources to enable Google to sidestep a proposed state bill that could compel tech companies to compensate news organizations when advertising appears alongside articles on the tech company’s platform.

The announcement was replete with praise for the endeavor to stabilize the news industry, which has witnessed layoffs and the closure of newsrooms as readership has shifted online.

“The deal not only provides funding to support hundreds of new journalists but also helps to rebuild a robust and dynamic California press corps for years to come, reinforcing the vital role of journalism in our democracy,” Governor Gavin Newsom stated in a release.

The California News Publishers Association trade group hailed the agreement as “a first step toward what we hope will evolve into a comprehensive program to sustain local news in the long term.” Assemblymember Buffy Wicks, the bill's author, lauded it for being a “cross-sector commitment” and emphasized that it is “just the beginning.”

Nevertheless, a union representing journalists denounced the deal as a “shakedown,” and lawmakers who had been working for months on more comprehensive proposals criticized its scope. Furthermore, the president pro tempore of the State Senate, Mike McGuire, questioned legislative support for the state’s share of the deal, which would require approval as part of the annual budget process.

“We have concerns that this proposal lacks sufficient funding for newspapers and local media, and doesn’t fully address the inequities facing the industry,” said Senator McGuire, a Democrat. He added that “the Senate was pursuing a global solution that would hold all of these companies accountable.”

The deal would establish a News Transformation Fund administered by the Graduate School of Journalism at the University of California, Berkeley, to preserve and expand California-based journalism. Twelve percent of the funding for the News Transformation Fund would be reserved for locally focused publications and those aimed at underrepresented groups.

Under the agreement, California taxpayers would provide the new fund with $30 million in the program’s first year and $10 million in each of the next four years, to be allocated by the Legislature in budget bills. Google would contribute $15 million to the fund in the first year and at least $10 million in each of the following years, according to a summary provided by Ms. Wicks’s office.

Google would also provide $62.5 million over five years to create a National A.I. Innovation Accelerator, which would provide “organizations across industries and communities” with funding and other support to experiment with artificial intelligence “to assist them in their work,” according to the announcement. Additionally, the company would maintain $10 million a year in existing programs it has to support journalism.

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For two years, Google had resisted the bill, stating it would create “uncapped financial exposure” and “a level of business uncertainty that no company could accept.”

Kent Walker, chief legal officer for Google’s parent company, Alphabet, called the agreement “a collaborative framework to accelerate A.I. innovation and support local and national businesses and nonprofit organizations.”

The Media Guild of the West, a local of the NewsGuild union, criticized the deal as “vague" and “opaque.”

“Not a single organization representing journalists and news workers agreed to this undemocratic and secretive deal with one of the businesses destroying our industry,” it said.