Peter Franck, lawyer to the stars, has identified two options for Pacifica: “a consensus structural change (Plan A) or enact the ‘Friendly Divorce’, (Plan B)”. He published the proposals on the 10th anniversary of Pacifica Executive Director Nicole Sawaya’s parting shot, an open letter to the deceased Lew Hill. This is his preamble, ‘Pacifica at a crossroads’. The plans are posted here separately.
Copied, with the addition of a paragraph-break at the end, from Mr Franck’s work website, https://culturelaw.com/special-information/pacifica-at-a-crossroads/.
“Without conflict, quite simply, there would be no learning, growth, or change…. The more desperately a given change is required, the greater the risk that it will threaten the balance of power within a system, making both its continued existence and precise resolution uncertain. This uncertainty can provoke fears that change will become chaotic or necessitate higher levels of skill than may currently be available to successfully resolve the underlying problem, thereby promoting increased resistance, defensiveness, and calculated impasse.
“Thus, breakdowns inevitably precede breakthroughs, and chronic conflict is the first sign that fundamental shifts are taking place within a person, relationship, organization, or system.”
Ken Cloke, The Crossroads of Conflict, 2006
Pacifica is clearly at a major crossroads. In two and a half years, it will have to come up with almost $ 4 Million dollars ($3,986,000 to be precise) [no: the loan agreement states $3.7m, & it’s now reduced to $3.265m], to pay off its loan from FJC. All of Pacifica’s physical assets – its buildings and all the property inside of them are mortgaged as security for this payment (the licenses themselves, under FCC rules cannot be security for loans, but the proceeds of a forced sale of the licenses can be). The paralysis of the present system to deal with Pacifica’s problems in a world very different from that of its 1947 founders was eloquently expressed by the late Nicole Sawaya, in her letter of resignation exactly ten years ago [no: it’s her letter to the deceased Lew Hill], it could have been written yesterday. A copy is posted here [no longer there – but it’s available on this blog], but in part she says:
“Sadly, it [Pacifica – original interjection] is no longer focused on service to the listeners but absorbed with itself and the inhabitants therein. I call it Planet Pacifica, a term I coined during my hiring process. There is an underlying culture of grievance coupled with entitlement, and its governance structure is dysfunctional. The by-laws of the organization have opened it up to tremendous abuse, creating the opportunity for cronyism, factionalism, and faux democracy, with the result of challenging all yet helping nothing. Pacifica has been made so flat, that it is concave – no leadership is possible without an enormous struggle through the inertia that committees and collectives and STV’s … single transferable votes can engender.”
Nothing has changed in ten years except that Pacifica has blown more than $13,000,000 dollars. Imagine what we could do today to advance the founders’ dream, if we had that money, and were not going into deeper debt every day!
There seems to be some magical thinking going around that this loan really doesn’t have to be paid, that the lender (according to Pacifica’s former lawyer) “has never foreclosed,” etc. While there is always some possibility of some extension of time that comes at considerable extra cost in terms of interest payments at the rate of 7.5% (and as the loan and unpaid interest grows, so does the size of the actual quarterly interest payment).
Fundamentally, Pacifica has been living on borrowed time and kicking the can down the road time and again with short term solutions. According to Pacifica’s independent auditor’s reports, Pacifica’s expenses exceeded its income by an average of $1,632,588 per year for the eight (8) years from 9/30/08 through 9/30/16, for total losses over that period of $13,060,703. That can’t continue, and is a sign of a dying organization.
While people talk about factions and look to blame one personality or another, the fundamental truth is that Pacifica, at present, has no way of making the hard decisions forced on it by a drastically changed media environment. We should be looking at these changes even more so as required by the times. Regardless of how the recent election may have turned out, there has been a poisoning of the atmosphere internationally which is going to be difficult to reverse. The five Pacifica stations, the Pacifica program service and the 200 affiliates could be an important instrument in that reversal. Most of the stations are really hardly scratching the surface of that task today.
Pacifica has a choice of having its gradual dissolution forced upon it by lenders and creditors, or making some tough decisions itself. [paragraph-break added]
In this writer’s view, in order to save either the network or, if that is not possible save all of the five stations, Pacifica will have to take drastic action. This writer feels that we have to either adopt a consensus structural change (Plan A) or enact the “Friendly Divorce,” (Plan B). Both are discussed in separate papers attached.