Pacifica’s long-awaited audit shows where the money goes

get out of bed with scott walkerPacifica’s audited financial statements for the years ending September 2010 and 2011 have finally been released. You can download the reports at Pacifica’s website. The independent auditor raises “substantial doubt” that Pacifica can continue as a “going concern” without making changes in the way it operates.

The audit shows that of the network’s five stations, KPFA is the wealthiest, with net assets of $3.2 million. KPFK in Los Angeles is the only other station in the black. The rest are underwater. Worst of all is WBAI in New York, which has been operating under Pacifica-installed management for nearly four years. WBAI has a current net worth of NEGATIVE $3.3 million — with a deficit of $750,000 in 2011 alone.

You can also see from these audits that Pacifica’s National Office raises very little of its own funds. The lion’s share of Pacifica’s budget — $2,001,298 — comes from imposing a “levy” on the 5 stations (KPFA, KPFK, KPFT, WPFW and WBAI), of which KPFA pays roughly one quarter.

Where’d Pacifica’s $2 million go? The National Office doesn’t produce any programming of its own, but it carries personnel costs of about $1.1 million — mostly in management-level salaries. And it’s been spending increasing amounts on “legal fees.” In 2010, legal fees came to $328,433. In 2011, they grew to an astonishing $538,417. Some of it has been spent on expensive lawyers fighting legal actions sparked by Pacifica’s heavy-handed tactics at its member stations. In addition, SaveKPFA’s review of legal bills reveals that Pacifica has paid attorneys up to $500 per hour to come up with legal strategies for obstructing the KPFA recall election currently underway, and blocking dissident board members’ legal right to inspect records (such as legal bills).

Since 1999, the costs of supporting Pacifica’s national bureaucracy has grown from 9% to 20% of the network’s total income. To give some perspective, the National Office’s budget is twice the size of either KPFT or WPFW, and it’s nearly the same size as each of the other three stations (KPFA, KPFK and WBAI). Pacifica was meant to be a coordinating body to provide support and reduce costs, but it has become the opposite of that. It produces no radio programs, but spends huge sums on executive salaries and costly, unproductive board meetings. KPFA could operate much more easily if it did not have to pay 20% of its listener contributions to Pacifica.

PLEASE JOIN US AT THE BOARD MEETING SATURDAY AFTERNOON, 7/21 — that’s when we expect the board to have open sessions and take public comment. Come then and you’ll meet up with KPFA staffers like Letters and Politics host Mitch JeserichAgainst the Grain co-host Sasha LilleyKPFA News anchor John Hamilton, and many other SaveKPFA supporters who will be at the meeting.

There is also an OPEN RECEPTION for the board at the station Friday night, 7/20 from 7-10pm. (Address: KPFA, 1929 Martin Luther King Jr. Way, Berkeley) Please attend if you can – you’ll be able to talk directly with PNB members there!

For background, read Brian Edwards-Tiekert‘s open letter on layoffs and our report on Pacifica’s demand for $1 million in cuts at the stations.

KPFA’s local board chair urges YES vote

Original KPFA radio dial, circa 1949
Original KPFA radio dial, circa 1949

“Let me paint a picture of where KPFA is now — because it should concern all of us — no matter which side we’re on,” writes Margy Wilkinson, chair of KPFA’s local board in an open letter to listeners. Wilkinson cites evidence of the dramatic loss of listenership following Pacifica management’s purging of the station’s most listened-to program, the Morning Show, produced by a crew of young, diverse journalists. What follows is a tale of stunningly undemocratic dirty-tricks, financial mismanagement and anti-union maneuvers that have caused KPFA listeners to demand an immediate change in Pacifica’s management — starting with the recall of Pacifica treasurer Tracy Rosenberg. | READ WILKINSON’S  ENTIRE LETTER

Pacifica demanding $1 million from stations to fix network’s financial problems

While KPFA’s fund drive came in a little low, the station’s overall budget remains balanced — the station is on track to have a small surplus. Not so with Pacifica, the corporation that owns KPFA as well as KPFK (Los Angeles), WPFW (Washington), WBAI (New York City) and KPFT (Houston).

Pacifica treasurer Tracy Rosenberg told KPFA’s local board on June 2 that Pacifica is demanding $1 million from all member five stations to balance its budget, and that cuts will likely come as staff layoffs. Rosenberg said KPFA would be responsible for a larger part of the cut since its budget is bigger than those of the other four stations.

“Pacifica is in crisis due to its own financial mismanagement,” said one board member.  Each station already pays 19.5% of its income to Pacifica for “central services” such as accounting, insurance, and common programming expenses. Pacifica has granted a 50% discount in those fees to WBAI, which has been operating with a huge deficit and an expensive Wall Street lease for years. In March, KPFA’s local treasurer and business manager reported serious problems with Pacifica’s taking more of KPFA’s money than it was owed — at that time, up to $154,000.

Listeners and staff are asking why KPFA and the other stations should continue to foot the bill. At June’s LSB meeting, several local board members questioned why KPFA would be asked to lay off staff to come up with $300,000 for Pacifica. “What is Pacifica doing about looking at ways in which WBAI can seriously cut their costs?” asked board member Sasha Futran, adding: “WBAI is taking the network down, potentially.” | LISTEN to an exchange between Futran & Rosenberg (3-min audio) or to the entire LSB meeting here: part 1, part 2, part 3, part 4.