Hey Pete,

Like the others have said I'd take some time to see just what demand there is in your area for an online news site like this, but the good thing is you can test the waters rather inexpensively.

I've been gearing up to do something like this for a while so I've researched all sorts of software solutions and the best two I've found are the content management programs from www.bigmedium.com and Article Live from http://www.interspire.com/articlelive/

Either program can be had for under a few hundred bucks, or you could also use a free program like WordPress to get things going too.

For a great example of someone already doing this in a town in Georgia, take a look at www.cumminghome.com. He's using the Big Medium script and has customized it to suit his needs and it'll be obvious that's he's doing pretty well for himself.

Personally, while I think you can make money by selling advertising on a site like this, I think more money can be made by giving local businesses a free listing or webpage in an online business directory and then offering additional services to them like web design, email marketing or other marketing and business services.

Just my two cents, but i hope this helps!

Steve