Distortions & Factual Errors

CL'ers' "facts" vs. reality at KPFA

The latest "Save KPFA/Concerned Listeners" screed is surprisingly short on facts for something that deigns to call itself Facts about KPFA's Crisis. Let's take a look at some of these so-called "facts".

"KPFA is in dire financial straits now because Pacifica, as the parent corporation, dipped into KPFA's bank accounts and took money to pay corporate bills"

KPFA is in dire financial straits because its listener revenues dipped by 30% since 2006 and its payroll and benefits figure (which is 2/3 of its expenses) did not. Board-passed budgets required layoffs in both 2008-2009 and 2009-2010 and the Save KPFA -Concerned Listeners board sanctioned local management in an abject failure to carry out a balanced budget. 2/3 of the reductions were never implemented.. Pacifica in fact, was owed $250,000 in joint bills that KPFA could not pay as of September 2010, a large contributing factor in the FSRN funding crisis.

"For many years KPFA has been the "cash cow" for the rest of the Pacifica stations and units, including the Pacifica National Office KPFA "loaned" Pacifica $1.5 million at the conclusion of the lawsuits in 1999-2002 era"

Those days are long gone. KPFA contributed a great deal of money to cover the embezzling and mismanagement at WBAI that persevered for most of this past decade, under the Save KPFA--Concerned Listener allies in New York. It should be noted that it was ICR allies who finally implemented long overdue management changes in New York, but only after a great deal of damage was done to the financial health of the network. Save KPFA--Concerned Listeners can answer the question of why Gendelman, Siegel and company preferred to loot KPFA on WBAI's behalf rather than address the epic New York mismanagement that included thousands of undelivered premiums and fund misappropriations. The funds shuttled to WBAI are gone and cannot be replaced.

"Since then, KPFA frequently helped other units to make payroll or for other expenses-most recently paying $18,000 for payroll at WPFW in September"

In September, KPFA could not make its own payroll, much less anyone elses. KPFA borrowed money from Pacifica's Houston station on September 15th and didn't pay it back until October 15th.

"Pacifica National has also frozen $150,000 of KPFA's investments as collateral for a Line of Credit that Pacifica has done nothing to pay off, and withheld KPFA's last three payments from the Corporation for Public Broadcasting (CPB)"

Save KPFA--Concerned Listeners stalwart Sherry Gendelman, when acting as the Pacifica Foundation board chair, is the individual who engineered the line of credit in question, freezing $300,000 of KPFA's then-reserve. $200,000 of the money was paid back to KPFA in August of 2009. The remaining $100,000 has been credited against the 2010 debt of $250,000 in back unpaid service fees.

"In late 2008, KPFA and Pacifica both received $375,000 checks from the same donor. These were endowment gifts, meaning KPFA and Pacifica were allowed to spend the interest, but not the principal. Shortly thereafter, Pacifica spent its principal--all $375,000 of it"

Pacifica took a loan against the money and structured a repayment schedule to rebuild the asset which is on schedule.

"Meanwhile, KPFA's check went stale during a window when nearly all the financial staff at KPFA and Pacifica turned over".

KPFA's check was hidden in a drawer by the then-manager for 14 months, way past its expiration date. KPFA's business manager reported the funds as having been deposited in a money market account. Auditor Helin Donovan discovered the funds were not in the bank account. KPFA's then-manager produced the expired check from the inside of her desk. She later resigned.

"The donor was happy to cut a new check--until they found out what Pacifica had done. They then put the endowment fund into the care of the San Francisco Foundation, which will manage the investments and cut KPFA checks for the interest"

The donor was appalled, rightfully, and insisted that the funds be put in trust so KPFA management could not misplace them again.

"Currently, Pacifica is billing its five stations (including KPFA) $25,000 per year each to replenish the endowment it spent down. But it does not appear to be depositing the money it collects in that endowment account. In other words: Pacifica's taking a pot of money it was never supposed to spend, spending it twice, and making the stations pay for it"

KPFA didn't pay the money for most of 2010, so it would have been difficult for Pacifica to deposit it. The KPFA worker budget advocated not contributing at all in 2010-2011.

"Pacifica has withheld all the paperwork on the San Francisco Foundation account from KPFA's Business Office, keeping KPFA in the dark about how its endowment is performing"

That doesn't seem quite parallel to hiding the check in a drawer for more than a year.

"Pacifica's executive director, Arlene Engelhardt, without consulting local KPFA management, laid off the Morning Show's staff on November 9 and told them not to continue broadcasting even though they were being paid through December 8. She cancelled all unpaid staff Morning Show segments too, and cancelled the November fund drive. She then ordered piped-in shows from sister station KPFK in Los Angeles, the hosts of which have declared their solidarity with KPFA's Morning Show staff. The elimination of the hosts and their salaries will not help KPFA's financial problems; it will make them worse"

Reducing the annual payroll from 2.2 million to 1.75 million is likely to significantly improve KPFA's financial position. That is $450,000 less in salaries and benefits for a unit that posted annual losses of $575,000 in each of the last two fiscal years.

"Canceling the show that raised the most money at KPFA, and retaining corporate management-side law firms to fight KPFA's workers can only make the situation worse"

KPFA had higher daily fundraising averages after the layoffs than it had in the previous 4 years. It is the decision of the 2 laid-off workers and the Local 9415 to engage in legal maneuvers. Legal maneuvers cost money.

"On December 20, Engelhardt appointed a crew of unpaid staff to host a new 8 AM show, nearly all of them affiliated with the board faction that supports Pacifica management, and moved Democracy Now! to 7 AM."

They made a proposal for local AM programming at no additional staffing costs. Democracy Now is doing quite well at 7am.

"Web audience statistics--which are, generally speaking, a good analogue of total audience--suggest the listenership has plummeted to about a third of the level it was before November 9"

KPFA's online stream represents 300 listeners, in a station with 21,000 subscribers and hundreds of thousands of listeners. More to the point, recent online statistics have shown a considerable rebound and are steadily going up. The show needs some improvements, but it is new and like anything new, it needs to find its feet and develop.

"Beginning in Fall 2008, KPFA's management and Local Station Board began proposing budgets that provided for orderly staff reductions in the face of the economic crisis sweeping the country, and the accompanying drop-off in listener donations However, Grace Aaron, then-Pacifica chair and acting executive director, blocked those reductions, forcing KPFA to spend down its reserves"

Grace Aaron did nothing of the kind. KPFA's then-manager asked Ms. Aaron to authorize cuts to Flashpoints and Hard Knock Radio that were out of compliance with the union contract. Ms. Aaron replied that Pacifica would not support violations of basic seniority provisions. Ms. Rijio then failed to carry out any substantive layoffs at all. She resigned her position in March of 2010. The same layoff plan was presented again in the fall of 2010. It was not carried out by Pacifica.

"Yes, over the past year, KPFA management has closed open positions, every department at KPFA has cut its budget, and most paid workers have taken hours cuts. In cooperation with local managers, KPFA's union helped those who reduced their hours participate in an innovative "Work Sharing Unemployment Insurance Program," established by the state legislature that pays benefits to individuals whose hours have been reduced, helping employers avoid layoffs"

Reductions carried out prior to the layoffs met less than 35% of the requirements for a balanced budget. KPFA continued to carry 2.2 million in salary and benefits expense. The deficit for the period from October 1, 2009 to September 30, 2010 was $575,000. The actions were ineffective.

"In 2010, those measures had already reduced KPFA's personnel spending by 20%"

According to objective reality as reflected in financial statements, the reductions were less than 10%.

"KPFA also created an incentive package for voluntary layoffs, under which seven employees left the station's payroll altogether. When Pacifica came in, it cut only two people: Aimee Allison and Brian Edwards-Tiekert, both of whom were already part-time employees".

The severance package, which was very generous for an organization in severe financial straits, was implemented when the layoffs were imminent. Pacifica was obligated to reach a 1.75 million total salaries and benefits number according to the budget for the upcoming year.

"Nora's hours were reduced at Flashpoints as part of an earlier round of budget cuts. She then decided to quit. When similar hour cuts hit other programs, like the Morning Show, the staff members working on those programs chose to share the hours reduction so no one person took too large a hit"

Barrows-Friedman's hours were reduced by half in December of 2009, a far more severe cut than was applied to other programming units, and programmers with far less seniority than she. Dennis Bernstein has stated that he was told he was not allowed to cut his own hours to return them to her at the time.

"There are currently no lawsuits related to the terminations on the Morning Show"

No, there are merely 8 union grievances--5 of them filed by the same individual.

"However, after Pacifica illegally threw out the votes of three staff members in a bid to swing a recent election in favor of the board group it favors, three staff members--Brian Edwards Tiekert, Mitch Jeserich and Lewis Sawyer--filed a legal petition seeking to correct Pacifica's violations of California state law. Pacifica's vote-tampering happened after the initial vote count. Pacifica was able to do this because each ballot is printed with a numerical code identifying the voter--so much for the secret ballot!"

The staff members went on the air lying about the contents of a confidential meeting they did not attend in an attempt to win the election for their Save KPFA--Concerned Listeners slate--in violation of election rules governing that LSB elections may not be discussed on-air without the permission of election staff. Pacifica is happy to redo the staff election in question, but can't because the right-wing law firm hired by Save KPFA (founded by the chair of Lawyers for Bush-Cheney 2004) won't let them.

"Paid staff at KPFA are represented by Communications Workers of America Local 9415, which has filed grievances as well as a charge with the National Labor Relations Board over recent events"

Local 9415 failed to file grievances in defense of Andrea Lewis when Aimee Allison replaced her , nor in defense of Nora Barrows-Friedman when she experienced a disproportionate loss of hours. Save KPFA--Concerned Listeners failed to support the unpaid staff when their association was derecognized in 2007 and has failed to support the return of the program council the unpaid staff have demanded for years.

"Daniel Moynihan, 'You're entitled to your own opinions, but you are not entitled to your own facts.'"

I couldn't say it better.

January 2, 2011

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financial data

10 Years of KPFA Finances in TABLE FORMAT

and, presented as a GRAPH, the same data:
10 Years of KPFA Finances GRAPH

for more information and updates please visit Support KPFA at www.supportkpfa.org


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