The state Legislature is expected this week to pass a landmark bill that would create a new fund to bolster local news coverage, to help fill the void created by the steady economic decline of the media industry.

Five universities would lead the Civic Information Consortium and with a board of directors decide which local news start-ups it would fund through a grant.

Supporters say would be the first endeavor of its kind in the nation.

"Despite the good work of many talented journalists across the state, years of runaway media consolidation, layoffs and newsroom closings have left many communities with little to no local news coverage," Free Press Action Fund News Voices Director Mike Rispoli said. "That's not just bad for the journalism industry -- it's harmful to our communities and our democracy."

The legislation creating the Civic Information Consortium (S2317) passed the Senate 35-0 Monday, with the Assembly expected to cast the final vote on the bill this weekend. Then it will be up to Gov. Phil Murphy to decide whether to sign it into law.

Complicating the bill's progress is the budget impasse between Murphy and the Legislature's two top Democrats, Assembly Speaker Craig Coughlin, D-Middlesex, and Senate President Stephen Sweeney, D-Gloucester.

A $5 million appropriation to get the fund started was included in the budget both houses of the Legislature approved last week. But Murphy, who is locked in a showdown with top Democrats over which taxes to raise, has threatened to veto the budget.

Senate Majority Leader Loretta Weinberg, D-Bergen, and Assembly Majority Leader Lou Greenwald, D-Camden -- influential politicians in their own right -- are prime sponsors of the bill, making its chances for passage strong.

"Local news is the lifeblood of a community. It adds local context to stories and keeps those in power accountable. Supporting it is undoubtedly in the public's best interest," Greenwald said after a vote on the bill last week.

The College of New Jersey, Montclair State University, the New Jersey Institute of Technology, Rowan University and Rutgers University would lead the consortium, funding projects to improve the quantity and quality of news, according to the bill.

The nonprofit consortium would have its own staff of four as well as a 13-member board of directors, with two each appointed by the governor and the legislature, one each from the five colleges, and four from community groups, and the media and the technology fields.

Eligible grant proposals must show the work is a collaboration with at least one of the universities and one media, technology or community representative.

Last year, the Free Press Action Fund held 10 public forums across the state to solicit project ideas, Rispoli said.

The goals of each approved project, according to the bill, should include "giving residents enhanced access to useful government data and public information through innovative applications, platforms, and technologies; training students, professionals, and community members in the practice" of journalism, and "nurturing better civic engagement and dialogue inside and between New Jersey communities."

Susan K. Livio may be reached at slivio@njadvancemedia.com. Follow her on Twitter @SusanKLivio. Find NJ.com Politics on Facebook.