Two recent reports paint a rosy picture of local TV news. Stations are launching new programs, jobs are coming back and revenues are up. Bolstering these reports are stats from the Radio Television Digital News Association, which called 2010 a record year for local news.

I just wish that were the whole picture. However, neither of these reports fully grapples with the impact covert consolidation — in which a station signs away control of its newsroom to a competitor — is having on the media ecosystem.

Credit Where Credit Is Due

We spend a lot of time here at SaveTheNews documenting declines in local journalism, so it’s nice when we have some positive news to report. Last week TVNewsCheck reported that after years of cutting back on investigative journalism, Scripps Television was “bucking the trend.”

“Scripps Television has made new hires and put existing staffers through special training as part of a concerted effort to improve investigative reporting at its nine news-producing stations,” the report reads.

The story highlights how an investment in investigative reporting is good for local communities and good for the bottom line. In the article, Scott Lewis, a veteran Detroit-based investigative journalist who recently joined Scripps, insists that the company is serious about this effort. “They want good journalism, strong ethics and stories that hold people accountable,” Lewis says. “You don’t see that much in the TV business these days. So many stations go for the ‘flash and trash’ because it’s cheaper and easier to produce.”

Scripps is not alone in investing in local news. In Monday’s New York Times, Brian Stelter profiles how KSDK, St. Louis’ local NBC affiliate, has added newscasts, “giving it six and a half hours of local news each weekday, its highest count to date.”

In Stelter’s article, David Lougee, president of KSDK’s parent company Gannett Broadcasting, notes that “local broadcasting had gone on autopilot,”, and had “become sort of commoditized and formulaic — arguably in many cases irrelevant.” KSDK’s expanded local news coverage is a reaction, Lougee says.

This increase in local news coverage is important. “Station economics affect the nation’s news diet,” Stelter writes, “because local TV news is consistently identified in surveys as the top news source for most Americans.”

Only Part of the Picture

Stelter argues that “this is what the rebound in local television looks like,” but not all stations are bouncing back like KSDK. In fact, many stations have so thoroughly gutted their newsrooms that there is no way to rebuild them.

And at the end of his piece Stelter discusses one key trend that calls into question the cheery statistics about the upswing in local TV news.

While KSDK is adding more hours of local news, its competitors aren’t. In fact, KSDK is now actually producing a large portion of the local news for KDNL, the St. Louis ABC affiliate.. But that’s not all. What Stelter doesn’t acknowledge in his article is that St. Louis suffers from two covert consolidation deals.

The company Local TV owns KTVI but also programs news for KPLR (owned by the Tribune Company). So while one station may be expanding its local news production, overall the St. Louis market is presenting viewers with fewer and fewer diverse viewpoints and more copycat journalism. Sometimes the exact same stories air on these stations, with the same anchors reading the same scripts in the same studios.

This is a clear circumvention of the FCC’s media ownership rules. While the letterhead on these stations may not change, the impact on the local community is no different than if the stations had changed hands.

St. Louis has one of the worst cases of newsroom consolidation, but across the country Free Press has identified over 100 examples of these shady deals involving more than 200 local TV stations.

In fact, Scripps Television, which was heralded in the TVNewsCheck article, has engaged in covert consolidation in four markets. In Phoenix, Detroit, Tampa and West Palm Beach, Scripps has partnerships that undercut local news. In fact, the most recent Pew Research Center “State of the News Media” report features this quote from Scripps:

“More stations also are producing news for another station in the same market, as Scripps-owned WPTV in West Palm Beach, Fla., agreed to do for Raycom’s WFLX beginning in January 2011… E.W. Scripps CEO Rich Boehne said his company hoped to make similar arrangements in other markets. ‘So if you know folks in those markets who you think should not be in the news business and you’d like us to take over their stations for them, just give us a call,’ Boehne told an investors conference.”

So even while Scripps is reinvesting in investigative journalism in its own stations, its covert consolidation deals have closed other newsrooms. Scripps is just one of many companies involved in these deals: The Pew report notes that around the country at least 224 stations are running news produced by another station.

It’s time for the FCC to confront the issue of covert consolidation. With profits rebounding and an expected windfall from political ads over the coming year, local TV stations have no reason to outsource news coverage to their competition. Stations that consolidate their newsrooms are abandoning their public service requirements and squatting on valuable public airwaves that could be put to much better use.