Changes on the horizon at Pacifica, as a financial crisis threatens KPFA and the rest of the network

KPFA listeners and staff are deeply concerned about the worsening financial and governance crisis at the 5-station Pacifica network, including the mortgaging of KPFA’s building in Berkeley to pay off the debts of New York station WBAI.

The Los Angeles Times has just published an investigative article by Pulitzer Prize winner Michael Hiltzik, which looks into Pacifica’s financial and governance problems.

A recent audit shows Pacifica with an operating deficit of $4.6 million, writes Hiltzik, who adds that “the chief drain on Pacifica’s resources has been WBAI,” including a $1.8 million debt for its unpaid antenna rent.

The national board has refused to deal with WBAI’s financial problems, instead voting in 2018 to mortgage KPFA’s building and other property for an ill-advised $3.25 million loan.

KPFA’s studios were built by donations from Bay Area members, who did not intend them to bail out a failing New York station. Payments on that $3.25 million loan are now coming due, and threaten to tank station budgets. A balloon payment for the balance is due in April 2021.

When WBAI could not meet its payroll multiple times last fall, Pacifica’s then-interim executive director John Vernile sounded the alarm. But after making changes at the station to reach more listeners and save money, a dysfunctional Pacifica National Board ousted him and put WBAI back into the hands of those who have mismanaged it for years.

Structural change? Court orders Pacifica bylaws vote

An Alameda County Superior Court judge ordered Pacifica to put bylaws changes proposed by a group of KPFA & KPFT members to a network-wide vote.

Details are at RethinkingPacifica.org, including a news blog about developments. The proposal is endorsed by Larry Bensky, former national Pacifica correspondent | Heidi Boghosian, executive director, The Muste Foundation; co-host of Law & Disorder Radio | William Fletcher, Jr., writer/activist, host of WBAI’s “Arise!” | Peter Franck, past president, Pacifica Foundation (1980-1984) | Matthew Lasar, Pacifica historian, author of Pacifica Radio: The Rise of an Alternative Network | Carol Spooner, former PNB member (2002-2004) | and hundreds of others

If approved, the bylaws would create an 11-member board, 5 directors elected by station listeners and staff, and 6 directors who are well-known radio professionals and community leaders, among other changes. You can read their biographies here.

KPFA has posted a timeline of the vote. Ballots are due to be sent on February 18 to all members. Stay tuned for more information.

Support KPFA’s work

The staff at KPFA came together for live coverage of the historic impeachment hearings last week. Please take a moment to thank them by renewing your membership or making a donation.

Or attend an upcoming KPFA benefit talk, such as journalist E.J. Dionne (February 27), economist Richard Wolff (February 28), and SUNY professor Gretchen Sorin (March 11). See all upcoming events at KPFA’s website.

VERY SERIOUS DEVELOPMENTS AT PACIFICA

Dear Pacifica Radio Members of KPFA, KPFK, KPFT, WBAI, or WPFW,

As you may have heard, last Monday Pacifica’s interim Executive Director, John Vernile, went to WBAI in New York City. He laid off the employees, and cancelled local programming, replacing it with curated programs from all around the network called “Pacifica Across America.” You can listen to it online at www.wbai.org.

Understandably, many WBAI listeners are upset and do not understand what happened or why.

The Pacifica National Board will be voting very soon on whether to ratify Mr. Vernile’s actions — the PNB appears to be split down the middle — 11 to 11. They are being inundated with upset and angry messages from WBAI listeners. They need to hear from the rest of us who do not want to lose our stations or see the whole Pacifica Network go down. 
You can reach them by email at pnb@pacifica.org

Some background info: In April of 2018 Pacifica took out a $3.25 million loan to payoff a judgment against Pacifica for WBAI’s unpaid rent for their broadcast tower on top of the Empire State Building and to break the lease. That loan is secured by everything Pacifica owns, and it comes due in full on April 1st, 2021. So far, there is no clear plan to come up with the funds to pay it off. In that context, Pacifica’s move to stop the financial bleeding at WBAI makes painful sense.

Here is a message I sent to the PNB this morning. Perhaps you could use it for some ideas for your own messages in support of Mr. Vernile’s actions.
Dear PNB Members,

I urge you to vote to support John Vernile’s very painful, difficult and courageous actions at WBAI last Monday. 

I believe the best hope for Pacifica now is strong and stable executive leadership with a cohesive board to back him up. The lender (on the $3.25 million loan) is watching Pacifica carefully, and very worried about their loan, I am sure. Seeing that strong action has been taken to stop the bleeding at WBAI, and seeing that the board supports that action, would be reassuring to them. Then, I believe John Vernile would have a reasonable chance to negotiate with them about extending the term of the loan. Without that, I would not be surprised to see them foreclose on their loan (as is their right under multiple conditions we have not been able to fulfill so far).

We, the whole network, have done our best for WBAI. It wasn’t enough, and has exhausted the reserves and resources that are necessary to get the rest of our stations on a better footing.

The audits tell the story, and I’m sure the lender carefully reads them. As of the last audited financial statements (9/30/17) WBAI owed $4 million in inter-division payables to the National Office and the other Stations. That included unpaid Central Services and other funds advanced to WBAI to cover expenses. WBAI’s total net deficit as of that date was ($6.6 million), including $2.36 million in accrued rent. 

You can see for yourself here: https://www.pacifica.org/finance/audit_2017.pdf

Ten years before (as of 9/30/07) WBAI’s interdivision payables were $502,389, and they had a net deficit of ($99,603). See for yourself here: https://www.pacifica.org/finance/audit_2007.pdf

That is a total loss of $7.1 million over the past 10 years at WBAI.

The individual station info is in the “Supplemental Information” at the back of the audits.

Both Hurricane Sandy and the Empire State lease took a terrible toll on WBAI. 

The rest of the network did the best we could to help WBAI … the national office cut everything they could, and more. I say more because for a couple of years there they didn’t have the staff or money to do critical things like do the audits (the 2017 audit was filed 2 years late!).

We (the rest of the network) sold the National Office building (paid for by KPFA listeners as part of the mortgage on the KPFA building). 

We (the rest of the network) loaned them money. We (the rest of the network) picked up as much of the slack as we could with national expenses and increased Central Services payments. We (the rest of the network) got them a new transmitter. 

And, finally, we (the rest of the network) mortgaged the KPFA, KPFK, and KPFT buildings (and everything else we own, including intellectual property at the Archives, all our furniture, fixtures, equipment, etc.) to get the loan to payoff Empire State and break the lease.

But our financial condition continues to deteriorate across the network. Listenership and donations continue declining. We have to change. We have to keep WBAI on the air with programs from elsewhere, while we strengthen the rest of our stations. Then, if the lender gives us a couple more years, we can reinvest in WBAI and bring back local programming … stronger and better I hope.So, again, I strongly urge you to support John Vernile. Our lender is watching. It is important for any negotiations with them that John have the strong backing of his board for stabilizing Pacifica and turning things around. Without that, I really do fear that all will be lost.

Best wishes and many thanks,
~Carol Spooner
(PNB Member 2002-2004)

QUESTIONS? Please email us at votesavekpfa@gmail.com

KPFA elections coming: make sure you get a ballot!

kpfabumperstickerThe Pacifica network is poised to hold its first board elections in three years. SaveKPFA has put together a full slate of wonderful candidates, who will bring fresh perspectives onto KPFA’s board.

But to get them elected, we’ll need your vote, and that means you’ll need a ballot.

To be eligible to vote, you have to have given at least $25 to KPFA in the year ending this Tuesday, July 14.

Not sure whether your last donation was recent enough? The best way to make sure you get a ballot is to donate right now at https://secure.kpfa.org/support/

We’ve made great progress, but we need your help to keep it up

SaveKPFA came together as an organization devoted to supporting KPFA’s paid and unpaid staff, securing local control of our radio station, winning accountability and transparency from Pacifica (the nonprofit corporation that owns KPFA), and getting terrific programming onto the air.

bannerWe won control of KPFA’s Local Board the same year that Pacifica’s then-leadership sidelined KPFA’s listeners and local management by canceling KPFA’s much-loved Morning Show, and attempting to purge its staff.

Since then, we’ve changed the leadership at Pacifica, helped repair KPFA’s morning lineup, recruited permanent, stable management for KPFA, and started to stabilize Pacifica’s financial problems. Check out our history at saveKPFA.org.

That work has finally resulted in real progress at KPFA: our station launched a spiffy new website this spring that’s optimized for use on mobile devices (where larger and larger numbers of people are getting their media). Management freed up space for new voices by piloting 20 hours of new programming on its second signal, KPFB. And, finally, KPFA has started to shrink the length of its fund drives. (Just last week, KPFA General Manager Quincy McCoy announced we’re able to cancel KPFA’s Summer Fund Drive–for the first time in 15 years!)

Everything we’ve achieved over the past several years has been made possible by thousands of mobilized listeners like you: who turned out at demonstrations to win back control of KPFA, who dug deep during fund drives when KPFA was on the brink, and who delivered landslide victories to SaveKPFA in successive listener elections.
If you support that progress — and you’d like to see more — show your support and secure your ballot by donating NOW at https://secure.kpfa.org/support.