DAILY REPORTS and Documents | iPNB Berkeley meeting info
Pacifica executive director's report
Presented at the iPNB meeting in Berkeley June 21 - 23, 2002
Interim Executive Director's Report to the
As you all know, the new Pacifica Board and executive leadership inherited a financial and administrative nightmare in January of this year. The network had been looted and left rudderless. Stations did not even have funds to buy a paper clip let alone a pair of headphones and critical services like telephones and postage were being cut off. Pacifica's transmitters were under threat, including KPFK's historic tower on the top of Mt. Wilson. With no chief financial officer or controller, and chaos reigning in the national office, the network was on the verge of financial collapse.
An independent financial review published in February reported that Pacifica faced a 2002 calendar year budget gap of $1.5 million and a deficit of $4.8 million. Some stations were facing serious working capital deficits. WBAI was looking at a hole of $350,000 and KPFK $250,000. With only $11 million in annual revenue, these debts posed a serious threat to the organization's survival. Bankruptcy was openly being contemplated.
Today, five months later, the network stands alight with the promise of a new day. The Pacifica Foundation has a balanced budget and all of our stations are operating in the black. Local stations now have authority over their own finances and money that is raised locally is largely being spent locally. The network's overall debt has been slashed from $4.8 million to an estimated $2.5 million, a remarkable turnaround in such a short time.
During this financial turnaround, we pioneered a unique form of programming, the Altercast, showcasing -- in a unique day-long, pin-wheel format -- the talent and voices of all of Pacifica's five stations. The Altercast was unveiled earlier this year when, in an inspiring show of network-wide solidarity, the entire Pacifica community rallied to save KPFK's transmitter. I'm pleased to report that as of this next week the KPFK transmitter is slated to be at full power, up from its weakened 8,000 watts to a full blown 112,000 watts. Many thanks to Pacifica's consulting engineer Don Mussell and to the entire KPFK staff and community for this great achievement.
The financial turnaround, and the new collaborative spirit, has occurred because of the commitment and talent of many selfless and wonderful staff and community members. Indeed, the entire Pacifica community moved aggressively -- and quickly -- to deal with the financial crisis. At the national level, the strategy was simple - cut costs and raise revenue while at the same time maintaining financial transparency and the integrity of Pacifica's most important assets - its five stations. National units took sharp cuts. We rolled back on salaries for national management and general managers. Wage cuts for top managers ranged from 33 percent to ten and five percent for national staff and station management. Unions and local staff around the system deferred pay raises and everybody tightened their belts. Nickels are being treated like manhole covers.
Tough decisions had to be made. On Feb. 15, we closed down the network news operations and reorganized the Ku satellite system, saving an estimated $1.2 million a year. Democracy Now! took a 35 percent budget cut, the Pacifica Archives 20 percent, and the national office contracted sharply. A voluntary lay-off package was initiated at Pacifica largest station, WBAI in New York.
We stopped the golden parachute severances packages that had been handed out to former staffers and executives. In January, those claims and packages involving 21 staff totaled more than $650,000. We reviewed Pacifica's legal obligations on those claims and thus far the network has only paid out $140,000 to a handful of former staffers. We understand that many people, quite rightly, feel that these packages were immoral and unethical and nobody should be permitted to loot the network like this. All of us agree. However, because of legal liabilities, Pacifica had to make good on some of these claims. In our estimation, it would have been more costly to challenge the claims than to pay them out. In other words, it was better not to throw good money after bad. This strategy has enabled us to save half a million dollars.
We have also begun to deal with the eight large professional service firms who claimed that Pacifica owed them some $2.2 million. There has been a payment of some $512,000 from Pacifica's insurance company to two separate law firms, Williams & Connolly and Fulbright & Jaworski. Further, we have begun challenging the bills from other firms and entering into prearranged settlement plans with them. Thus far, we have managed to reduce the claims from $2.2 million to $1.6 million, a reduction of some 27 percent. No payments directly from Pacifica have been made to any of these alleged creditors. However, we will be paying out some of these outstanding obligations in the very near future.
On the fundraising side, I am pleased to report that Pacifica's revenue has increased sharply over the last five months. Listeners have rallied in extraordinary numbers to our call for support, holding house parties, inviting friends and colleagues over and then sending in to the national office dozens of checks. In the New York tri-state area, there have been no less than four separate fundraising events organized by listeners and WBAI staff in the last several months. Again, many thanks to those individuals and foundations who have rallied to Pacifica at this critical time.
At the station level, we're seeing record fund-raising. Pacifica station KPFT in Houston, for instance, posted a record winter fund drive of $390,000 smashing the old mark of $280,000. WPFW in Washington, DC, just posted its largest every spring fund drive in history -- $420,000. At WBAI, listeners pledged some $900,000, an all-time spring fund-drive record and up 55 percent from the $580,000 pledged during last year's spring drive. Listeners at KPFK 90.7 FM in Los Angeles pledged a record $618,000, up 45 percent from the previous year's spring fund drive total of $425,000.
And t Pacifica's flagship station, KPFA 94.1 FM in Berkeley, California, listeners pledged a spring fund raising drive record of $621,000. The drive was capped by the largest single day of fundraising in the station's 53-year history, with some $104,000 pledged on the drive's last day.
This spring's fund-raising record follows Pacifica's highest ever winter on-air drive this past January and February, generating nearly $3.5 million in on air pledges at Pacifica's five stations.
I am pleased to report that the national office has also been aggressive in raising funds. The office spearheaded the Save Our Signal day that raised some $209,000 and the April 20th day of programming that raised more than $40,000. June 19th, or Juneteenth, the network rallied once again to produce a live 15-hour broadcast from coast-to-coast. All five stations suspended local programming to air this historic national broadcast from 7:00 am to 10:00 pm Eastern. More days of national fundraising and national programming are slated over the next few months, including one on Sept. 18th. We are also planning a national mailing and telemarketing campaign. We anticipate that all of these efforts should raise some $500,000 combined.
In recent months, the Pacifica national office has reactivated many of our long dormant revenue generating sources, like the Subsidiary Communication Authority (SCA) channels at our five stations. Currently, of the 15 SCA frequencies available to Pacifica, two are utilized by Pacifica stations, KPFA and KPFK, and six are leased to private vendors. The current monthly revenue from SCA contracts is $44K, $528K annually. Two of the frequencies are just coming back on-line with the KPFK transmitter project finishing and three others have leases pending. If these leases are signed under the current terms being offered, Pacifica would earn an additional $14.5K per month.
At the same time as raising revenue and tightening our belts, we moved to strengthen Pacifica's financial systems, procedures and personnel. The introduction of two separate financial software systems in the last year as well as new budgeting procedures and the move of the accounting office from Los Angeles to Washington, DC, left the entire financial spine of the network in crisis. We hired a comptroller, two station business managers, and restored financial authority to local stations. In April, we gathered all the network business managers in Washington, DC, for a three-day training in a new software system. We are confident that our accounting systems should all be up to date and fully operational by in the next few months.
Though great strides have been made, challenges remain. Pacifica's FY01 audit needs to be completed. Further, central services allocations, i.e., the financial picture between the stations and the national office, needs to be clarified. That whole relationship between national and the stations completely broke down last year as the national management arbitrarily raided station accounts to pay for exorbitant expenses incurred by the Executive Director. We are still putting the pieces back together and are hopeful that central services allocations will be running normally in the next couple of months.
Pulling Pacifica back from the brink of bankruptcy is the result of much hard work and sacrifices by many people. Deputy ED Verna Avery-Brown and I would especially like to acknowledge and thank the hard work of the national accounting staff, led by interim Comptroller Yhasmine Bryan. We'd also like to acknowledge the support, wisdom and experience of KPFA interim GM Jim Bennett, and the entire KPFA community, as well as that of WBAI GM Valerie Van Isler. Their insights and commitment, as well as that of their staffs the communities they represent, to the well-being of the national network have been indispensable over the last five months.
When Verna and I came before you at the Los Angeles board meeting, and in my previous board reports shortly after assuming the position of interim Executive Director, two clear goals were laid out. No. 1 was stabilizing Pacifica's finances. No. 2 was the process of reconciliation and reform at the five Pacifica stations.
I'm pleased to report that all five Pacifica station are working collaboratively and forging new relationships with communities and Local Advisory Boards. New leadership is being put into place - or is in the process of being put into place - at each of the five stations. For the first time in Pacifica's recent history, there is a participatory process for the change in leadership - a process that directly involves the key Pacifica stakeholders - paid and unpaid staff, union and management, Local Advisory Board members and national board members, and listener and community organizations. This process has led to the hiring of a new GM at KPFK 90.7 FM in Los Angeles and a new GM at KPFT in Houston. GM Search Committees are presently under formation and working at WBAI, WPFW and KPFA in Berkeley.
The leadership and staffing transitions at the local stations have, at times, been very difficult. But we have adopted a clear policy of "Deactivation," of taking the gun out of Pacifica politics and spending the extra time to resolve problems. We are pleased that the contestation and acrimony that have characterized previous administrations and transitions have been largely absent. This is because the new reform leadership has been careful to approach issues in a collaborative manner. We have forged real partnerships with Pacifica's unions and worked hard to resolve disputes before they have festered and grown out of control. Mediation and dialogue have replaced confrontation and conflict. I am pleased to report that two union contracts have been signed in the last five months - one with CWA at KPFA in Berkeley, and one with AFTRA covering Pacifica National Programming workers. We are also negotiating new AFTRA contracts for paid workers at WBAI in New York and in Washington, DC. We will be opening up contract negotiations with UAW who represent unpaid workers at WBAI.
In the wake of last December's legal settlement, Pacifica's Local Advisory Board are assuming a much more important role in Pacifica's governance than in many years. The national office has worked hard with many of the GMs and LAB members to develop a new spirit of cooperation in LAB-Station relations. Still, many questions remain about the extent of LAB responsibilities and the overall relationship between policy and operations. Most of these issues will be hammered our over the course of the next several months as new bylaws are written and adopted. In the meantime, the LAB chairs, the national office and the station managers are developing guidelines as to how the relationship might move forward in this interim period.
Another key issue that has emerged during this period of healing and reconciliation has been programming. How do local Pacifica stations articulate Pacifica's mission in their day-to-day programming? What are the structures and processes around programming?
Last March, Verna Avery-Brown and I asked KPFA programmer and former PNB board member Robbie Osman to form a commission to look at Pacifica programming and the programming process
The Mission Commission was conceived as an way to enlist the help of some of Pacifica's most thoughtful and politically committed friends in our collective effort to examine how decisions are made within Pacifica and to consider how the way we make those decisions affects that we end up being, what we end up doing, and how effective we end up being as an agent for peace and justice.
The idea of the Mission Commission was based on the premise that it would be helpful to enlist the help of more of Pacifica's politically committed friends in our collective effort to rebuild the network. More specifically, the idea was to develop a mechanism for a structured examination of issues like how decisions are made within Pacifica and how the way we make those decisions affects who we end up being, what we end up doing, and how effective we end up being as an agent for peace and justice.
The need for this work is part of a broad effort within the network to strengthen and where necessary reestablish ties between progressive leadership and Pacifica. The old leadership of the Pacifica Foundation had, over the course of many years, systematically undermined every avenue (structured and informal) of accountability, communication and reciprocal power within the organization and between the organization and the communities and struggles that it exists to serve. There is a need to facilitate and encourage direct communication in the expectation that that would help reestablish healthy and appropriate relationships within the larger Pacifica family, and between Pacifica and the broader progressive social change movements.
The name 'Mission Commission' was catchy but in the end it created misunderstanding. Organizing a commission of well respected and thoughtful friends from outside the immediate Pacifica family was envisioned as part of the effort but was not the heart of the project. As it happened, the difficulties presented for several of the prospective participants by the commission form and suspicion and resistance from some in the Pacifica community of a group like this led to the conclusion that other ways of accomplishing the work would be better.
The work is ongoing. We have been meeting with friends whose activism in a wide spectrum of progressive efforts might otherwise limit their ability to take part in the day to day operations of Pacifica and our stations to ask for their insights and active participation and to bring them closer to Pacifica. We have held several useful and productive meetings on both coasts and more such meetings are planned. And there are a number of different options being discussed on how to move forward. Foremost among these is convening a national programming conference later this year.
Technical and Physical Plant
Because turnover in staffing will continue as the network rebuilds, we need to remain concerned about pending and potential inspections of stations by the FCC. Transmitter operating logs, Emergency Alert System (EAS), public file updates and proper postings are all items that if not in compliance could cost Pacifica thousands of dollars in fines and additional thousands in legal costs. The national office has encouraged all stations to review their facilities using the FCC's Self-Inspection Guide.
At KPFA, bids are currently being received on new transmitter and antenna. Half the funds for this project are from a grant awarded to KPFA by the Public Telecommunications Facilities Program, a competitive grant program of the department of Commerce.
At KPFK, the transmitter install continues to make good progress though there have been minor complications but nothing out of the ordinary. The transmitters are in place but final connections won't be made until the HVAC work is completed. The air handling units will arrive the week of June 17th. Once the air conditioning is in place, the installation of the transmitters will be complete and KPFK will return to full power following required transmitter testing. Because of the delay on the HVAC, Don Mussell will be completing the installation at KPFK and unable to attend the board meeting in Berkeley.
At KPFT, the FCC has not acted on our construction permit application to raise operating power to 100kw. Negotiations on a leasing a tower site in Galveston are preceding. We anticipate installing a translator in Galveston late this summer and reaching an additional 300,000 people.
AT WPFW, the antenna installation is in need of immediate replacement, though repairs may also be required to keep a signal on the air. There have been a series of outages this past spring and there is no back up antenna facility for WPFW. The tower lease expires in October 1st. Tower owners with a relationship with WPFW have proposed that WPFW move to their site just north of Washington DC. The move hasn't been fully studied but it does give WPFW an option over its current site if negotiations prove difficult.
At WBAI, there is a lot of new work going on at the Empire State Bldg where WBAI's antenna is located. More tenants, especially television stations, are moving in due to the loss of the WTC. There is the potential that changes in the installation could have a negative impact on our operation. WBIA General Manager Valerie Van Isler, Don Mussell and John Crigler, Pacifica's FCC lawyer, are monitoring the situation to insure WBAI's interests are represented in any new negotiations.
In other technical matters, the Pacifica national office has begun to examine Pacifica's web development and attempting to coordinate the web work around the system. For the first time ever, all of Pacifica web masters have been talking to each other, exchanging ideas, philosophies and strategies. There is a long way to go and, given the current financial climate, there have been few resources available to launch any major new web developments. However, for Pacifica to move forward, the organization must actively develop a robust web presence.
At the pacifica dot org site, we have begun preliminary work by restructuring the current content. The entire site consists of 2,862 web pages; with a total of 97,197 links (of which 25,112 are broken links, 44,821 are external links, and 27,264 are confirmed correct). Clearly, the site needs to highlight the fabulous content of the Pacifica system. It also needs to be marketed better, optimized for search engines, and we also need to develop online progressive website alliances. We're aiming to organize a system, online and any other way possible, to start brainstorming Pacifica wide about what we want from our websites, how can we best reflect the Pacifica Foundation online, etc. Ultimately, we want to pool together the feedback and see how it all fits, i.e., what is technologically feasible, what is financially feasible, what are our priorities.
All of us at the national office very much appreciate the patience and work of the entire Pacifica community and the interim Pacifica National Board. As we continue with our difficult work of restoring Pacifica to financial health, and moving forward with the reform process, please know that we do so openly and honestly. We not only have an open books policy, publishing our accounts on the web, but we have also sought to inform the wider Pacifica community exactly what the issues are that we face and how we are trying to tackle them.
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