not saying that part of the story isn't sloppy, but it's clear at the end when Mike closes his diary that the headline has been changed from "crackheads" to "locals", implying that the headline was another mental horror Pennywise had inflicted on him. I thought also there was a hint that the Bowers may be behind the fire, but that may be an overreach.

The movie isn't exactly smooth about exploiting minority pain (the gay couple at the start, Beverly's abuse, the tribe of natives...) to serve its narrative progression so I don't want to give the writers any benefit here, but I didn't think that particular aspect was as problematic. I might be way off base though, this is just my interpretation.