Policy delay of nonprofit status spikes Chicago News Cooperative

Rumors started quickly, trying to explain why the Chicago News Cooperative was closing. The Internal Revenue Service had rejected the co-op’s application for nonprofit status. Then it was said that the MacArthur Foundation had refused to fund the startup out of fear it might take down City Hall friends. The truth was more prosaic. Several events — its tax status, its inability to lasso a deep-pocket donor and the demands of its publishing partner the New York Times — moved the news co-op to suspend operations Feb.