What we do need is some way to keep our local government and businesses accountable. We need reporting on that factory that's spewing waste which affects the health of 20 families. Or about that town government decision to buy cheaper water (and how it looks brown and might have lead in it). Or about that corrupt police chief.
If there is a local AP equivalent in your area that does this, then that's great. But in most areas this would not be profitable.
Someone needs to do this work, and if we want it done reliably and done well, it needs to be payed for.
Most of the issues you are talking about required the press to amplify them in the good old days. Today there are many more avenues for people to shine a light on stuff. I mean if a 9 year old has worked out how to get her message out others will too. And the role of the press as an amplifier will reduce. My sense is propping them up artificially might create other headaches.
An external authority with an incentive to break news that matters is crucial.
Why must that be exposed as "news"? You should have that baked in, with repercussions for individuals that break laws/regulations within a public entity, etc.
Really, I think a lot of society's ills would be solved with adequate oversight and repercussions of public institutions and individuals.
The AP and my regions local press version of it are good enough and I'll be happy to fund them. If I need something deeper I pay. Like Bloomberg for example.
The rest of it is all entertainment and opinion which like the content of the porn industry/facebook/youtube/reddit (thanks to advertising) will always come for free.