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The Imminent Threat to KPFA / Pacifica Radio
by picasso
Saturday Dec 30th, 2017 3:51 PM
Message from KPFA general manager, from reprint of a blog by Doug Henwood (who produces KPFA's Behind the News).
Because WBAI is broke, almost listenerless, and run by idiots, the station didn’t pay its transmitter bill to the Empire State Building for a long time, and is now $3 million in arrears. The ESB has sued and wants to seize Pacifica’s assets, which would include KPFA and KPFK’s bank accounts and buildings.

Because the Pacifica board is staffed by idiots, the network is not filing for bankruptcy or taking any other meaningful measures to protect itself. The rational thing to do would be to sell WBAI’s frequency (at 99.5, it’s on the commercial section of the radio dial), because the station is braindead and pointless, and the proceeds could save the rest of the network. But that doesn’t seem to be happening.

There’s a high risk that KPFA — where Behind the News originates — will stop broadcasting on January 12. I don’t know what that means for the future of BtN, but aside from that, the loss of KPFA would be tragic.

It’s taken years to get to this point. If you wanted to destroy the network, you couldn’t have done any better than make Tony Bates the WBAI program director and Berthold Reimers the general manager. And you couldn’t have done any better than staff the board with people who have no idea of how to run anything. It would be premature to type “RIP,” but it’s not too soon to make what delicate people call “arrangements.”

A note on the topic from the KPFA manager follows.


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 never been 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 12h.

• 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 31 st., 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

Comments  (Hide Comments)

by Tracy Rosenberg
Saturday Dec 30th, 2017 4:35 PM
You want to remove the threat of collections activity as soon as possible by taking out a loan and paying off the summary judgment ASAP.

The actual collections activity that can go on is being overstated by KPFA management. There are only 2 things that can happen (outside of bankruptcy). Empire State can put a lien on KPFA's building, but they can't take ownership of it or close it down. It just means they would have an interest in the proceeds if it were sold. KPFA's studio already has a lien on it for unpaid property taxes and has since 2014. Nobody even noticed until 2017.

Empire State also has no ability to impact the website or the broadcast license or the transmitter tower. What he can do, although not immediately, is attack KPFA's checking account and remove what cash is in it as a payment towards the debt. This would hurt KPFA financially and probably require an emergency fundraiser to replenish operating funds.

That's it.

Taking out a loan and paying them now removes that threat and gives you three years to address the long-term debts, with a signal swap, signal sale, or real estate sale (or whatever else you figure out).

Going into Chapter 11 bankruptcy empowers ESRT to really get their hands on KPFA's and Pacifica's assets as their excellent lawyers will staff the creditors committee in bankruptcy and will be able to propose their own Pacifica reorganization plan to a federal judge who may well select the creditors plan. Won't be up to any of us.

So if you are concerned about KPFA and Pacifica, bankruptcy is not your friend. Taking a loan to pay them off quickly is the best defense.
by Tracy Rosenberg
Saturday Dec 30th, 2017 4:46 PM
The attachment has all the board's closed session relevant motions and decisions, the dates and the vote count.