I always hear that people aren't really interested in local news, but local teevee news seems to be pretty popular. And I think local teevee news often gets a bit of a bad rap. I'm not saying it's always engaging in hardhitting investigative journalism, but nor are newspapers. I'm also not saying that they're covering all of the important things all the time. But, locally at least, they do a decent job of explaining what's going on in the community.
My take - potentially wrong - is that local newspapers often fail to make local news interesting and, yes, entertaining. The dry view from nowhere balanced reporting is an even worse model for local reporting. It makes things that people are actually familiar with dull and colorless. Zoning board meetings are horribly boring, but reporting on them doesn't have to be.