KPFA radio at risk due to $1.8 million judgment against Pacifica Foundation

KPFA radio at risk due to $1.8 million judgment against Pacifica Foundation

By Lynda Carson - December 28, 2017

Reportedly, legendary KPFA Radio - 94.1 FM, in Berkeley, has been placed at risk due to $1.8 million being awarded in a summary judgement to Empire State Realty Trust, Inc. (ESRT). Additionally, attorney’s fees against the Pacifica Foundation and WBAI radio in New York, have been granted because of a feud over alleged unfair and unreasonable, and exorbitant annual increases use of the antenna (unpaid tower rent) at the Empire State Building, in New York City.

Pacifica Foundation, owns the broadcast licenses for KPFA in Berkeley, WBAI in New York, KPFK in Los Angeles, KPFT in Houston, and WPFW in Washington D.C.

On the 6:00PM KPFA evening news on December 28, 2017, it has been reported that the Pacifica Foundation board members were deadlocked on a vote this evening to go into foreclosure, or file for Chapter 11 bankruptcy, due to over $2 million owed to ESRT because of the unpaid use of the antenna (unpaid tower rent) at the Empire State Building, in New York City.

During an interview on KPFA evening news with Pacifica's Interim Executive Director, Bill Crosier, he stated that the Pacifica Foundation is in peril with over 8 million in debt. Additionally, on January 8, 2018, KPFA may be shut down due to the lawsuit with ESRT if something is not resolved, according to Crosier. Crosier also stated that nothing has been paid to ESRT since last May. He also stated that if Pacifica files for Chapter 11 bankruptcy, they can protect their assets, including KPFA radio. However, Pacifica is seeking a loan to pay off the law suit, or their debts. Presently, Pacifica board members are deadlocked on voting for foreclosure or filing for Chapter 11 bankruptcy.


December 27, email to KPFA staff from Quincy McCoy, General Manager of KPFA:


Subject: [KPFA Staff] The Imminent Threat: IMPORTANT

All,

I’ve held off writing this depressing message as long as I could in an effort to gather as much information and analysis possible while working with current and former LSB members in trying to protect KPFA’s interests in this grim situation we find ourselves in.

Because of Pacifica’s critical financial condition and the PNB’s lack of strategic action or courage the prognosis for the network’s future is shadowy.

*The Imminent Threat*

Come *January 12th *KPFA’s money and property may be seized by the Empire State Realty Trust because of a 1.8 million dollar debt of our sister station WBAI.

If this happens we will cease broadcasting because we will be unable to operate the station. At that point, our building and our bank account will no longer be under our control. Needless to say, this is a terrible position to be in, especially for management when there is *still* no plan of action to articulate from the National leadership to the staff.

*How Did This Happen?*

WBAI owes the Empire State Realty Trust 1.8 million dollars in delinquent transmitter rent. [Plus more delinquent rent since April, not covered in the suit.] ESRT filed in court against Pacifica on November 23rd, 2016. Their monthly rent is currently at $53K per month escalating each month.

On October 4 a judge found in favor of ESRT making it possible for them to file in all states where Pacifica has properties, allowing them to seize money and property.

The idea of a signal swap for WBAI was ignited and brokers were hired.

The PNB voted to give IED the authority to begin preparation for Chapter 11 bankruptcy protection, but he and many others on the PNB thought to sell properties (like our two adjacent buildings) and others could cover the debt. The other idea was a high-interest loan that so far has neverbeen secured. All of these instead of the signal swap in New York.

Then the PNB rescinded the bankruptcy resolution. Also, KPFA and KPFK signals were added for signal swaps.

ESRT judgment filed in California on December 6th to seize property and money from KPFA and K. It is a 30-day waiting period that ends January 12th.

Then the PNB voted to allow some prep for Bankruptcy.

At PNB meeting 2 weeks ago California’s Deputy Attorney General, Julianne Mossier spoke at the meeting and made it clear that the board needed to vote to take action immediately and that anyone who obstructs for any personal reasons were liable for not carrying out their fiduciary duties.

The board ignored her plea, but set up an emergency meeting about moving ahead with bankruptcy the following Monday but no action was taken.

The clock is ticking…

*What is Being Done?*

I want to thank all the LSB members who have worked so diligently this year negotiating with the PNB in good faith to move the network in a positive direction while also protecting KPFA’s interests.

Because of the imminent threat of a lien on KPFA’s bank account, we have disbursed in advance (what is legally allowed) our payroll account to Dec 31st., medical benefits till February and all of our essential bills are paid. In the first week of January, we will process advance payroll for January and pay another month of medical. I’m sorry to say that is all management can do. There still is no playbook for a month or two months down the road.

What is the PNB doing? The governance structure of Pacifica, our historic culture of the usual political infighting, etc., has led to disagreement and paralysis. Unless action is taken pretty immediately we may cease to exist. You deserve to understand where things stand. I could wait no longer.

Much respect, Quincy McCoy

General Manager, "In times of crisis, *unity* is the only solution."


July 11, 2017 Press Release, Regarding The Lawsuit:


In a July 11, 2017 press release, Pacifica's Interim Executive Director, Bill Crosier, asserts that “The amount being charged is over four times the market rate in New York, and threatens the future of independent radio. Market rate for FM transmitter tower leases in NYC is now about $12,000 monthly. WBAI's bill for the month of May 2017, in contrast, came to over $53,000. We've been on the Empire State Building since 1965 and have always been willing to pay what's fair and reasonable, but these exorbitant annual increases are killing us. The ESRT must settle and release us from the rest of this onerous contract."

According to the July 11, press release, “ESRT is demanding over $2 million for unpaid tower lease costs, holding the network hostage in an annually escalating contract involving increases of about 9% per year. ESRT is a multinational corporation that held $554.4 million cash and cash equivalents as of Dec. 2016, and owns billions of dollars of real estate.”

“After the destruction of the Twin Towers in 2001, broadcasting stations in the NYC area had few options for antenna space rental. ESRT took advantage of its position in the market. In 2005, their owners negotiated a highly questionable contract with Pacifica. ESRT has refused to release Pacifica from the contract, which is scheduled to continue until 2020.”

KPFA is the first listener sponsored radio station in the United States, and some of the legendary history of the radio station is known across the country, and the planet.

A community based listener supported radio station, KPFA has supported the local community for many years, and would be sorely missed if ESRT were to take over the station and Pacifica’s assets.

Lynda Carson may be reached at tenantsle [at] yahoo.com

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