. . . test launch of the KPFK repeater station, the Ojai Valley, Ventura County, the whole event supervised by local hip-hop sensation, MC False Decorum, PNB Vice-Chair Queen Liz III . . .
[UPDATE: with a 22-day drive report given to the W26Oct KPFK Finance Cttee, the original calculations arising from the 12-day report had to be revised (see below). This means the post’s title now needs to read, ‘current annualised rate of loss-making is $1.3m $1.260m, up $219k $143k on the August FY2023 budget … total revenue now down 20% 13%, covering only 80% 87% of personnel costs, 51% 56% of operating costs, & 40% 43% of total costs’.]
[FINAL UPDATE: after the drive ended, an oral report – all of one sentence – was given to the W9Nov KPFK Finance Cttee by GM Michael Novick. The calculations, revised again. And the post’s title now needs to read, ‘current annualised rate of loss-making is $1.3m $1.282m, up $219k $165k on the August FY2023 budget … total revenue now down 20% 15%, covering only 80% 85% of personnel costs, 51% 55% of operating costs, & 40% 42% of total costs’.]
UPDATE (not to be secreted away): The Case of the Entitlement & Arrogance of Cde Chair & Vice-Chair Eileen ‘honestly, with Trump running that year, 2016, I completely forgot I joined the June LSB’Rosin: . . .
(Speaking of chairs, & so of seats, it hasn’t been mentioned in public, but current PNB Chair, ‘Julie Clueless’ Hewitt (WPFW listener-delegate), completes her 6yrs as a delegate in December – the day isn’t obvious coz WPFW didn’t have a delegates’ assembly that mth, so presumably it’s the 31st; by-law Art. 4, Sec. 8 simply says “[a] Delegate’s term of office, shall be three (3) years, beginning in December” – https://pacifica.org/indexed_bylaws/art4sec8.html. It’s irrelevant that, in virtue of being a delegate, she was seated as a LSB member the following mth, on 11Jan2017 – https://kpftx.org/pacalendar/showfile.php?id=4762&type=minutes.) … (Incidently, PNB Finance Cttee Chair James Sagurton (WBAI listener-delegate) terms out in a month or so, 7Dec – https://glib.com/lsb_attendance_ninth_wbai_lsb.html(no minutes or audio at kpftx.org).) . . .
Which brings us to Julie’s co-conspirator, both locally & nationally, Eileen ‘I know I’m the Audit Chair, but as I don’t like the resolution I’ve torn it up & blocked it being sent to the PNB – and yes, I do think I’m a democrat’ Rosin & her dirty lil secret: Eileen Rosin, who is also the Vice-Chair of the WPFW LSB, termed out 22June2022, having been seated 22June2016, & winning in the elections of 2016 & 2019. So far she has improperly – illegally – attended at least 17 Pacifica meetings: PNB Audit Cttee (3 open, 2 closed), WPFW LSB (4 open, 3 closed), WPFW Finance Cttee (3 open), WPFW Financial Stability Cttee (attended at least 1 meeting; one of the five members; Cttee’s existence is missing from kpftx.org), WPFW Communication Standards & Enforcement Cttee (attended at least 1 meeting; one of the three members; Cttee’s existence is missing from kpftx.org), other WPFW LSB cttees (x no.) … Minutes of 22June2016 WPFW LSB, item V: “Motion: Tony Norman[.] I move that we fill two seats where we had resignations advertised. Then wait 30 days to fill the seats for the resignations during this meeting. No objections[.] New LSB members are: Cliff Smith[,] Eileen Rosin.” Eileen was then elected twice as a listener-delegate: 2016, came in 5-6th, the 2nd “count”, certified by True Ballot, Inc., 20Oct2016 (p. 13 of the PDF), with NES Serpe’s final report, if ever written, not publicly available; & 2019, 7th, the 13th “round”, certified 15Nov2019 (NES Peñaloza’s final report, pp. 1 & 6-7; pp. 3 & 8-9 of the PDF). And yes, minutes/audios/suggested agendas across June2016-Oct2022 show her unbroken attendance – also that the above Mr Norman currently sits next to her on the WPFW Finance Cttee … Eileen ‘honestly, with Trump running that year, 2016, I completely forgot I joined the June LSB’ Rosin …https://kpftx.org/pacalendar/showfile.php?id=4410&type=minutes …https://elections.pacifica.org/wordpress/wp-content/uploads/2016/10/0731601-certification-letter-6.pdf… https://mega.nz/file/8IN3RbbI#N2AmLp-WzCIcBaXDcMJ7EJWlEZaNp2YHio7_KHymuCc(Ms P’s report) … https://kpftx.org/archive.php … Last, the unambiguous by-law wording: “[a] Delegate may serve a maximum of two consecutive 3-year terms […] If a Delegate serves as elected or alternate for an incomplete year, those month/s of service must be counted towards the six years cumulative limit” (Art. 4, Sec. 8; all emphases added – especially the heavy-dutied “must“) – https://pacifica.org/indexed_bylaws/art4sec8.html . . . Harby, the carrier pigeon, is readying to fly to Cde First Secretary Vasilieva with the news . . .
. . . back to KPFK’s trajectory . . .
The station is currently in fund-drive. The Oct biggie. Michael Novick, hitherto Local Station Board Chair, became General Manager Novick effective M26Sep, replacing Moe Thomas, Magister Pacifica Peripatetica. Two days later he gave drive details to the 28Sep KPFK Finance Cttee: it starts in the dark, at the very beginning of Tu4Oct, & “the plan is probably to be in fund-drive for, urgh, the remainder of the month; ostensibly talking about a $350 000 goal for that, argh, which, unless we can really improve our performance, then the on-air fund-drive [goal] is un-unlikely to be met” (27:58, from 24:38). 350k? Well, thru M31Oct, so 28days, 350k ÷ 28 = $12 500 pledged per day – https://kpftx.org/archives/pnb/kpfkfin/220928/kpfkfin220928a.mp3.
So how’s it going? Unlike recent drives, such as last Dec, there’s currently no progress thermometer on the station’s homepage, https://www.kpfk.org/, or hidden away on the website. And there have been few public details, the latest seems to be thru day #12:
“[D]aily average, so far in this drive, for a week, is $3 600”
So falling, slightly, not materially – but ~⅓ below the budgeted $5 333. Oh. But what about that phrase of Kim’s, the drive “making $3 500 a day”? So cash, not pledges? Well, one may think that – as have some minions at PacificaWatch – but there’s killer evidence that shows the talk about drives, whenever it’s ambiguous, it’s almost always about pledges, not the $$$ generated.
Kim herself made it plain during her presentation to the 24Aug KPFK Finance Cttee: “we will start with Listener Support […] The total of umm, revenue, according to that, is $790 245”, & she gave the “that” as 162 drive-days, at $5 333 a day. Well, $5333 x 162 = $863 946 … & 790245 ÷ 863946 = 0.9146, so that’s the fulfilment rate, ~91%. (Not that anyone asked why she hadn’t mentioned the rate, & what it was, & how it compared with, say, the last 10 drives, or how it can be justified – why not 90%? 85%? 80%? or the stable 78% from May & Oct 2021? Given the public evidence, in the below calculations it’s prudent to use 78%, & not the budgeted 91% which is neither explicitly disclosed nor even mentioned – and certainly with no attempt to justify this jump to 91% with the presentation of an evidenced argument.)
[UPDATE: at the W26Oct KPFK Finance Cttee, GM Novick reported on the drive: “I think [cra ckle: incredibly, WordPress won’t accept that word on its own within square brackets without a space!] the 22nd day of the fund-drive [well, the previous day was that; …] Through today, upto a point today, we’ve raised about $92 000 […] raising about $4 200 a day on average” (52:05; $4200 x 22 = $92 400) – https://kpftx.org/archives/pnb/kpfkfin/221026/kpfkfin221026a.mp3. The below calculations (that used $3 600 as the daily pledge level) have been revised, treating the $92k as pledged thru Tu25Oct. This amounts to an attenuation of the variance by ~$76k: $(4200 − 3600) pledged daily x 0.78 fulfilment rate x 162 days = $75 816. So, for example, the increase of the budgeted annualised rate of loss-making becomes $ 218981 − 75816 = $143 165.]
[FINAL UPDATE: as mentioned, at the W9Nov KPFK Finance Cttee, GM Novick gave a one-sentence oral report on the Oct drive, including “we raised a little over a hundred-and-thirty-three thousand [dollars]” (36:40). So, Tu4Oct-Sa5Nov (ended 1800 PDT), ~33days, & ~$133k pledged, so ~$4 030 pledged per day, & x 0.78 fulfilment rate ≃ $3 144 cash per day, & $103 740 total cash from the drive (133000 x 0.78). What he didn’t say – and no-one pointed it out – is that the daily pledged rate dropped at some point during the last third of the drive, from “about $4 200” to ~$4 030: diminishing returns: with the audience punch-drunk, the drive had reached saturation point. https://kpftx.org/archives/pnb/kpfkfin/221109/kpfkfin221109a.mp3. Remember, the draft FY2023 station budget uses a daily pledged rate of $5 333 – that’s ~32.3% more than achieved for this Oct-early Nov 33day drive.
And what does the $103 740 buy you? For the period of the drive, personnel costs were ~95.9% of that, leaving $4 288 to pay everything else – giving the station a daily budget of $130 (sic), & that’s the during-drive situation, remember. (Daily expenses? $6 081 – with vendors being $4 708 … see the budget below.) So worth repeating: 33 days of drive = personnel costs (for those 33 days) + $130 from each of those 33 days towards paying all the other expenses incurred on those days . . . with KPFK then dropping thru the trap-door intothe out-of-drive situation: total revenue of $855 a day.
One reason why the PNB focusing on selling a building – be it that housing KPFK/PRA or KPFA or KPFT – is missing the point.
All based on the FY2023 station budget, presented by then Treasurer Kim ‘(sigh) yes, Bella (sigh)’ Kaufman to the Su28Aug KPFK LSB:
total revenue……………………………………… $1 102 245
expenses – operating ……….. $1 718 535
expenses – Central Services … $500 868
total expenses ……………………………………. $2 219 403
total loss ……………………………………………. $1 117 158
Note: the Central Services figure is according to two old formulae (adopted by the PNB for FY2015 only (sic) – but used, improperly, since 1Oct2015 to this very day, so 7yrs & counting), not the one adopted, with immediate effect, by the directors at the Th18Feb2021 PNB: “Motion: ‘That the central services formula be based on 15% of total revenue of the stations calculated quarterly. All revenue is to be included in the calculations; however the cost of air conditioning for Pacifica Radio Archives shall be deducted from KPFK’s revenue, and the tower, studio and office rent for all stations shall be deducted from their revenue.’ There being no objections, the motion was approved.” (unpaginated; page 3 of the PDF) – https://kpftx.org/archives/pnb/pnb210218/pnb210218_7017_minutes.pdf.
(A full note is at the end of this post.)
The 7sec read:
KPFK current annualised rate of loss-making is $1 336 139 ≃ $1.3m . . . an extra $218 981 on the FY2023 budget figure$1 260 323 ≃$1.26m . . . an extra $143 165 on the FY2023 budget figure$1 281 805 ≃ $1.28m . . . an extra $164 647 on the FY2023 budget figure
Working: annual loss per FY2023 budget (presented to Su28Aug KPFK LSB) + reduction in fund-drive revenue (evidenced by 12days of current drive) = $1117158 + (((5333 − 3600) x 0.78) 162) = 1117158 + ((1733 x 0.78) 162) = 1117158 + (1351.74 x 162) = 1117158 + 218981 = $1 336 139 ≃ $1.3m
[UPDATE: per the 22-day report, with daily pledge level of $4 200, not $3 600 (a ~16.7% increase): KPFK current annualised rate of loss-making is $1 260 323 ≃ $1.26m . . . an extra $143 165 on the FY2023 budget figure…
Working: annual loss per FY2023 budget (presented to Su28Aug KPFK LSB) + reduction in fund-drive revenue (evidenced by 22days of current drive) = $1117158 + (((5333 − 4200) x 0.78) 162) = 1117158 + ((1133 x 0.78) 162) = 1117158 + (883.74 x 162) = 1117158 + 143165 = $1 260 323 ≃ $1.26m. The change is $ 218981 − 143165 = $75 816]
[FINAL UPDATE: per the after-drive report, with daily pledge level of $4 030: KPFK current annualised rate of loss-making is $1 281 805 ≃ $1.28m . . . an extra $164 647 on the FY2023 budget figure…
Working: annual loss per FY2023 budget (presented to Su28Aug KPFK LSB) + reduction in fund-drive revenue (using GM Novick’s after-drive report) = $1117158 + (((5333 − 4030) x 0.78) 162) = 1117158 + ((1303 x 0.78) 162) = 1117158 + (1016.34 x 162) = 1117158 + 164647 = $1 281 805 ≃ $1.28m. The change is $ 218981 − 164647 = $54 334]
The 13sec read, supplementary info:
[UPDATE: compared with the drop in total revenue per the 12-day drive report, that indicated by the 22-day report is a third less: 1 − (143165 ÷ 218981) = 0.346] [FINAL UPDATE: the report after the drive shows a quarter less, 0.248]
[UPDATE:per the 22-day report,total revenue down 13%… (1102245 − 143165) ÷ 1102245 = 959080 ÷ 1102245 ≃ 0.870] [FINAL UPDATE: per the after-drive report,total revenue down 15%… (1102245 − 164647) ÷ 1102245 = 937598 ÷ 1102245 ≃ 0.850]
• total revenueonly covers 80% of personnel costsonly covers 87% of personnel costsonly covers 85% of personnel costs
… 883264 ÷ 1100000 ≃ 0.802 … (yes, the revised budgeted total revenue doesn’t even cover the single class-item of personnel costs)
[UPDATE: per the 22-day report, total revenue only covers 87% of personnel costs … 959080 ÷ 1100000 ≃ 0.871 … (yes, the revised budgeted total revenue doesn’t even cover the single class-item of personnel costs)] [FINAL UPDATE: per the after-drive report, total revenue only covers 85% of personnel costs … 937598 ÷ 1100000 ≃ 0.852]
• total revenueonly covers 63% of ‘core’ costsonly covers 69% of ‘core’ costsonly covers 67% of ‘core’ costs
… 883264 ÷ 1392000 ≃ 0.634 … (‘core’ = personnel + utilities + tower rent + drive costs = $90k + 14k + 2k + 10k pm = $116k pm = $1 392 000 pa … notes: (a) this excludes the mthly utilities arrearages, keeping Mr Switchman at bay; & (b) no contract for earthquake insurance – a station responsibility – since c. Dec2021 (or praps Oct2021), per the KPFK July2022 mthly net income statement, line 68; also $0 accrued)
[UPDATE: per the 22-day report, total revenue only covers 69% of ‘core’ costs … 959080 ÷ 1392000 ≃ 0.688] [FINAL UPDATE: per the after-drive report, total revenue only covers 67% of ‘core’ costs … 937598 ÷ 1392000 ≃ 0.673]
• total revenue only covers 51% of operating costsonly covers 56% of operating costsonly covers 54.6% of operating costs– so almost half of these debts arising in FY2023 will be unpaid at year-end
… 883264 ÷ 1718535 ≃ 0.513
[UPDATE: per the 22-day report, total revenue only covers 56% of operating costs … 959080 ÷ 1718535 ≃ 0.558] [FINAL UPDATE: per the after-drive report, total revenue only covers 54.6% of operating costs …
in other words, new debt to vendors budgeted to be created in FY2023 is an incredible $780 937.
Another reason why the PNB focusing on selling a building – be it that housing KPFK/PRA or KPFA or KPFT – is missing the point.
• total revenueonly covers 40% of total costsonly covers 43% of total costsonly covers 42% of total costs
… 883264 ÷ 2219403 ≃ 0.3979
[UPDATE: per the 22-day report, total revenue only covers 43% of total costs … 959080 ÷ 2219403 ≃ 0.4321] [FINAL UPDATE: per the after-drive report, total revenue only covers 42% of total costs … 937598 ÷ 2219403 ≃ 0.4224]
• even if the fulfilment rate is 91% (91.47), not 78%, total revenue only covers 43% of total costs, so +3pcp (43.21 − 39.79 = 3.42)only covers 47% of total costs, so +4pcp(47.20 − 43.21 = 3.99)only covers 46% of total costs, so +4pcp (46.06 − 42.24 = 3.82)
… extra cash from a 91% rate = $3600 (0.91 – 0.78) = 3600 x 0.13 = $468 pd, & x 162 = $75 816 pa … hardly worth re-doing the calculation, but rather than write-up the post on Eileen ‘honestly, with Trump running that year, 2016, I completely forgot I joined the June LSB’ Rosin, & given we are where we are … (883264 + 75816) ÷ 2219403 = 959080 ÷ 2219403 ≃ 0.4321
… the 91% rate: 790245 ÷ 863946 = 0.91469
[UPDATE: per the 22-day report, even if the fulfilment rate is 91% (91.47), not 78%, total revenue only covers 47% of total costs, so +4pcp(47.20 − 43.21 = 3.99) … extra cash from a 91% rate = $4200 (0.91 – 0.78) = 4200 x 0.13 = $546 pd, & x 162 = $88 452 pa … ⇒ (959080 + 88452) ÷ 2219403 = 1047532 ÷ 2219403 ≃ 0.47198] [FINAL UPDATE: per the after-drive report, even if the fulfilment rate is 91% (91.47), not 78%, total revenue only covers 46% of total costs, so +4pcp(46.06 − 42.24 = 3.82) … extra cash from a 91% rate = $4030 (0.91 – 0.78) = 4030 x 0.13 = $523.90 pd, & x 162 = $84 871.80 pa … ⇒ (937598 + 84872) ÷ 2219403 = 1022470 ÷ 2219403 ≃ 0.4606]
• even in eternal drive, total revenue only covers 60% of total costsonly covers 68% of total costsonly covers 66% of total costs
… per budget, revenue = drive + others ⇒ 1102245 = 790245 + others ⇒ others = $312 000 … revenue in eternal drive = $(365 (3600 x 0.78)) + 312000 = 1024920 + 312000 = $1 336 920 … & ÷ 2219403 ≃ 0.6023 (on top of the infeasibility, this also assumes no extra fundraising costs)
[UPDATE: per the 22-day report, even in eternal drive, total revenue only covers 68% of total costs … revenue in eternal drive = $(365 (4200 x 0.78)) + 312000 = 1195740 + 312000 = $1 507 740 … & ÷ 2219403 ≃ 0.6793] [FINAL UPDATE: per the after-drive report, this becomes 66%: $(365 (4030 x 0.78)) + 312000 = 1147341 + 312000 = $1 459 341 … & ÷ 2219403 ≃ 0.6575]
• current rate of loss-making is 6.0% more than the rate at 6Nov2021 estimated by PacificaWatchis the same as the rate at 6Nov2021 estimated by PacificaWatch is 1.6% more than the rate at 6Nov2021 estimated by PacificaWatch
per the 12-day report, current rate of loss-making is $1 336 139 pa … at 6Nov2021, it was estimated as $1 261 397 pa … the difference, +$74 742 pa, +5.925% – so despite all the cuts over the last year (~25%), materially scaling back the operation, the station is effectively generating losses at the same rate: ~$1.3m a year. But this is happening to, & by, a radically different structural organism, in the double-sense of being structured in the present with the orientation of structuring itself into the future: since Nov2021, the ratio of total costs to total revenue has cranked up from 1.75 to 2.51 (2936208 ÷ 1674811 compared with 2219403 ÷ 883264): the station was slashed, but also butchered was its capacity to generate revenue. Hence the material relative deterioration. So although the rate of incurring costs has fallen 24.4% ($2 936 208 → $2 219 403), that of revenue-generation has collapsed by 47.3% ($1 674 811 → $883 264): almost twice the rate (x1.94) … Pacifica’s lack of strategic governance (by the directors sleepwalkers) has allowed a lack of strategic management (by their available instrument: ED Brazon & then ED Wells): in the parlance of the management of personnelhuman resources variable capital (the scientific concept), KPFK lacked a safeguarding policy – and all associated with it are suffering the consequences, not least the stressed-out GM Michael Novick … sleepwalking into the chainsaw … https://pacificaradiowatch.home.blog/2021/11/19/today-kpfk-is-losing-money-at-a-rate-of-3500-dollars-a-day-105k-a-month-1-point-26m-a-year-as-per-the-docs-publicly-why-does-no-one-recognise-the-scale-the-urgency-qm/
[UPDATE: per the 22-day report, current rate of loss-making is $1 260 323 pa … at 6Nov2021, it was estimated as $1 261 397 pa … the difference, −$1 074 pa, −0.085%, so well below −1%. . . so despite all the cuts over the last year (~25%), materially scaling back the operation, the station is generating losses at the same rate: $1.26m a year. So, the size of the annual loss is the same – ‘loss’ is an accounting term, but understood dynamically, & socially, it’s the creation of new debt – experienced in an inter-group & interpersonal way as extra pressure from creditors. (Hence Markisha’s current distress – of which more anon.) Since Nov2021, the ratio of total costs to total revenue has cranked up to 2.31 (2219403 ÷ 959080) … so although the rate of incurring costs has fallen 24.4% ($2 936 208 → $2 219 403), that of revenue-generation has collapsed by 42.7% ($1 674 811 → $959 080): the difference between the rates increasing x1.75.
[FINAL UPDATE: per the after-drive report, current rate of loss-making is $1 281 805 pa … at 6Nov2021, it was estimated as $1 261 397 pa … so despite all the measures taken, the rate has increased very slightly, by $21 482 pa, +1.617%.The ratio of total costs to total revenue has cranked up to 2.37 (2219403 ÷ 937598) … so although the rate of incurring costs has fallen 24.4% ($2 936 208 → $2 219 403), that of revenue-generation has collapsed by 44.0% ($1 674 811 → $937 598): the difference between the rates increasing x1.80.]
At 7+13secs, 20secs, that read is a ⅕ of the time Markisha took when she debuted as Pacifica’s NBM CHC, at the 25Oct PNB Finance Cttee:
after the removal of the last wisp of cotton wool, Markisha was led into the room by Steph, to make her first public appearance, the Tu25Oct PNB Finance Cttee (54:48). She spoke for exactly 100secs, 100secs, so Pacifica members are really getting their money’s worth (55:21-57:01). She said two things, and two things only, but they spoke volumes: she doesn’t have a report, & in fact she isn’t the NBM but the CHC, the Creditor Hotline Clerk. CHC Markisha. Apparently she can’t do any national, or local, business managing coz she spends all day getting calls from creditors, angry calls – all day long. Markisha really needs to tell her union steward she has to file a misrepresentation claim against her employer – and for displaying the truth, yet again, of the Peter Principle. https://kpftx.org/archives/pnb/finance/221025/finance221025a.mp3
CHC Markisha came in to fill a new post – the chief financial officer position has been left vacant. But does a corporation incorporated in California have to have a CFO? It may be advisable, a good idea, but is it mandatory, say by law? Yes:
“312. (a) A corporation shall have (1) a chairperson of the board, who may be given the title of chair of the board, chairperson of the board, chairman of the board, or chairwoman of the board, or a president or both, (2) a secretary, (3) a chief financial officer, and (4) such other officers with such titles and duties as shall be stated in the bylaws or determined by the board and as may be necessary to enable it to sign instruments and share certificates.”
Seems a bit odd to ask, but if a corp doesn’t have someone with that job title (form), or doesn’t have someone doing that work (substance), does the law recognise someone as the CFO? Yes:
“5213. (a) A corporation shall have (1) a chair of the board, who may be given the title chair, chairperson, chairman, chairwoman, chair of the board, chairperson of the board, chairman of the board, or chairwoman of the board, or a president or both, (2) a secretary, (3) a treasurer or a chief financial officer or both, and (4) any other officers with any titles and duties as shall be stated in the bylaws or determined by the board and as may be necessary to enable it to sign instruments.”
This is in the specific law applied to non-profit public benefit corps, such as Pacifica. In the same passage, it has something else to say about this figure, the “treasurer”:
“Unless otherwise specified in the articles or the bylaws, if there is no chief financial officer, the treasurer is the chief financial officer of the corporation.”
So PNB Finance Chair James Sagurton (WBAI listener-delegate) has been the CFO, per California law, since Th22Sep, when NETA left?
This is the rub: no. Pacifica by-law Article 8, Section 3:
“[…] The chair of the Finance Committee shall be a Director who may be referred to as the Board ‘Treasurer’. However, the Board Treasurer shall not be an officer of the Foundation. The Foundation’s Chief Financial Officer shall be an employee of the Foundation and shall not be the Board Treasurer. […]”
So Mr Sagurton can’t be Pacifica’s CFO, in the eyes of Pacifica law, & hence in California law. Which . . .
. . . means . . .
. . . that given having a CFO is legally mandatory for Pacifica, & Pacifica doesn’t have one – by either of the two legal routes – this means that Pacifica is breaking state law, yes?
And remember, in California law it is the directors who, ultimately, are responsible for protecting Pacifica’s assets, responsible for the organisation being in good order, re its financial management system, & otherwise. It’s because it’s not easy to achieve this standard of performance that directors authorise the hiring of expertise, like certified public accountants, & other suitably qualified & experienced accounts & internal audit staff. People who know what they’re doing. Effectively, protecting the directors from the consequences of their ignorance. But . . . if the directors think they can get by on their own, or they run out of perceived options (not imagining that KPFA’s ~31 full-time equivalents can be reduced in order to fund a CPA) . . . Well, that’s a different matter. With likely different results. Such as personal liability. When, for example, deficit endowment accounts, of hundreds of thousands of dollars, come before the court.
On the 21st-century funding of Central Services: is the centre/periphery relationship nominal or real, in both senses?
The current funding policy, even after 20mths (sic), has never been implemented, & not even mentioned in public (except by PacificaWatch minions) – the new reality has never been recognised by any member on any of a station Finance Cttee, an LSB, the PNB Finance Cttee, or the PNB. Yes, the PNB Finance Cttee repeatedly recommended to the PNB that they adopt budgets using a known false CS figure, & the directors sleepwalkers duly complied, like sheep, amnesiac sheep.
“National Office Shared Services Formula: To meet the budgeted expenses of the National Office not covered by other sources of income in fiscal year 2015, Central Services shall be a fixed cost set at 15% of the prior 4 years’ (2010-2013) average annual listener support. For WBAI, Central Services shall be set at 8% of that average[.]”
“[P]assed[:] 9 Yes, 7 No, 1 Abstention; Y – Edwards-Tiekert, Wilkinson; Brazon; Casenave, Reiter; Roberts; Brown, Diaz, Norman […] N – Kobren; Argueta, Kaufman, Reyes; Lamb; Birden; Gray […] Abs. – Fuentes-Roman”
“To meet the budgeted expenses of the Pacifica Radio Archive [sic] not covered by other sources of income in fiscal year 2015, PRA Assessments shall be a fixed cost set at 2.0% of the prior 4 years’ (2010-2013) average annual listener support for each station.”
Comparison of those FY2015 charges with the audited data . . . the FY2012 auditor’s report is dated 6Sep2013, so those figures could have been used. But the FY2013 auditor’s report is dated 18Mar2015, almost the end of the 2nd quarter. Maybe adjustments were made once it was available. Anyway, the audited figures for FY2010 thru FY2013, of ‘Listener Support and Donations’ (LSD), generate station figures that are within 0.915% ≃ 1% (14474 ÷ 1580998) of the charges applied from 1Oct2014 to this very day. Note that this is achieved using inconsistent data: the FY2013 LSD totals are different in being net of “premium incentives”, of the material sum of $1 221 694 (sic), 11.2% of the gross – https://pacifica.org/finance/audit_2013.pdf (note 12, p. 16, being p. 18 of the PDF). I wonder if anyone even noticed, let alone complained? In comparing the latest audited LSD figures, FY2021, with the 4yr-average of FY2010-FY2013, that average has been corrected (KPFA $2 862 995, KPFK $3 026 252, KPFT $966 340, WPFW $1 231 257, WBAI $2 557 101, total $10 643 945):
reminder: FY2021 LSD
2 409 334
1 457 370
1 311 369
1 131 507
6 773 286
FY2021 LSD as % of 4yr-av.
11 211 455
11 467 968
3 821 548
4 764 469
10 088 647
41 354 087
2 802 864
2 866 992
1 191 117
2 522 162
10 338 522
15% (8% WBAI)
1 374 228
1 580 998
actual PNO (15%; 8% WBAI)
1 386 912
actual PRA (2%)
actual annual total charge
1 595 472
. . . today’s CS charges spring from the early months of the Tea Party: fair? . . .
These Central Services policies were solely for FY2015. There has been no mention in the last 5yrs that the PNB extended their life. It seems these policies have been applied improperly since 1Oct2015 to this very day, for all of 7yrs & counting.
Prior to this, eons ago, perhaps from c. 2004, the policies seemed to have been 17% & 2.5%: “[t]he first two motions from the Finance Committee concern the formula by which Central Services are assessed. For the past decade, all stations have been charged 17% of their Listener Support to cover National Office Expenses, and 2.5% of Listener Support to cover Pacifica Radio Archive Expenses. (A few years ago, WBAI’s National Office charge was lowered to 7%[.])” (Brian Edwards-Tiekert, PNB Finance Cttee Chair & KPFA staff-delegate – 13Nov2014 PNB minutes, p. 6).
So it seems it is these c. 2004 policies that should have been applied from 1Oct2015 thru 18Feb2021.
An ancestor of this has been spotted in the minutes of the 9Jan2004 PNB Finance Cttee, with talk of “20%” being deducted from the stations, 17% to PNO & 3% to PRA, making that the extant policy. It’s also heartening to know that conflict was alive & well, with the Big Guys trying to squeeze the Lil Guy, & give him a shave: “the Policies and Procedures manual that Lonnie [Hicks, the CFO] and Dan [Coughlin, the ED] are asking us to approve shows lowering that to 2.5%” (unpag., p. 2 of the PDF) – https://kpftx.org/archives/pnb/finance/040109/finance040109_1844_minutes.pdf. Nice. Don’t y’just luv these NGO’s?
And you need to be careful about changes in terminology. The auditor’s reports this century always refer to “Central services”. But, in some of the Pacifica docs & discussions, ‘Central Services’ is also used as a synonym for the PNO, sometimes ambiguously.
One can end by returning to the title of this note, the two senses of the centre/periphery relationship being nominal or real: does money come thru?; is the centre king, or is the periphery fiefdoms? Who’s in charge? Who’s in control? The directors, or the station managers? Or is no-one in control, just flying blind? It’s why a focus of this blog is on the money dimension of the politics of control – placing boring accountancy centre stage as the supreme technique for controlling an organisation. By contrast, in the conditions that are Pacifica, is it rational for the directors, in practice, to place their ultimate responsibility – and legal liability – in the care of the managers, to trust the managers to act in the directors’ best interests? Especially now with the directors having given up the ghost on financial management?
Despite Pacifica’s 5 x Oct fund-drives, with the cash draining away, will it be payroll deadline 25Nov? or 9Dec? Either way, 6Jan really does look off-limits, with $52 235.23 due 31Dec, at the new rate of 9.25% on the $2 258 821 principal, to FJC – or will it have already sold on the debt to the Marty & Dorothy Silverman Foundation? The die is cast. And the court number is . . .
[UPDATE: the interest rate rose to 10% effective Th3Nov. The charge falling due 31Dec = ((2258821 x 0.0925 x 33) ÷ 365) + ((2258821 x 0.1 x 59)÷ 365) = 18890.550 + 36512.449 = $55 402.99.]
[Working notes on CS policy:
* PNB Finance Cttee minutes: 2004:
21May: so PRA charge not 3% (as per 9Jan2004 PNB FinC minutes, as mentioned in the post) but 2.5% (but KPFK’s is 2%): “A discussion was held on […] the formula for funding Central Services. [new para.] Next we discussed the situation at Pacifica Radio Archives, which are funded by a levy of 2.5% of listener donations except for KFPK which pays 2%.” (unpag., p. 1 of PDF; hereafter, -/1) – https://kpftx.org/archives/pnb/finance/040521/finance040521_1848_minutes.pdf (no audio recording at kpftx.org – the 2004 ones are later in the year, starting with the 29Oct meet)
. . . 10yrs on: the last time Pacifica had audited net assets was 30Sep2012 . . . audited net liabilities went as far south as $4 525 638, at 30Sep2016 . . . the latest audited net liabilities are $1 241 649, at 30Sep2021 . . . almost all of the improvement, 99.5%, is due not to operating performance but the auditor agreeing to three adjustments to total liabilities – screenshot of the FY2013 auditor’s report (page 3; page 5 of the PDF),https://pacifica.org/finance/audit_2013.pdf . . .
When did Pacifica last have audited net assets? That was 30Sep2012, $495 924. It was wiped out by the FY2013 loss of $2 824 046.
The zenith for audited net assets had been $7 684 012, at 30Sep2006. (Note that the higher figure in the FY2008 auditor’s report was restated downwards in the following year’s report.) FY2006 was indeed Pacifica’s last annual net income until it earnt an audited one for FY2020 . . .
. . . 13yrs of financial – and political – failure: the times of war against Afghans & Iraqis, of Obama hope & the $$$ crash, of Trump. Year after year when the directors responsible for Pacifica – with all these opportunities before them – proved they couldn’t turn a penny. Not one penny. Failures. All of them. No vision. No plan. No self-awareness that they failed – repeatedly. No recognition of their limitations – the need to ask for help from experts. No humility. No grace. So, arrogant. Zombies too.
One needs to say ‘audited’ coz for FY2019 NETA did present a net income to the auditors, but they effectively rejected it: they refused to express an opinion on the material accuracy of the three financial statements given to them coz they were unable to agree with NETA an evidenced estimate of the pension plans liability. In the jargon, the auditors issued ‘a disclaimer of opinion’ – auditor’s report (p. 2; p. 4 of the PDF), https://pacifica.org/finance/audit_2019.pdf.
(In the consideration here, highs & lows, it’s adequate to use data in money terms, not real terms, coz in the period there hasn’t been enough inflation to distort the meaning of the plain figures.)
The failing of Pacifica found expression in successive annual losses &, as its correlate, falling net assets, & during FY2013 these turned into net liabilities.
The nadir of audited net liabilities was $4 525 638, at 30Sep2016. This sum may even be an understatement because those financial statements had the added uncertainty of receiving a qualified opinion from the auditors – auditor’s report (pp. 1a-1b; pp. 3-4 of the PDF), https://pacifica.org/finance/audit_2016.pdf. Furthermore, until the 2019 Democracy Now! event mentioned below, net liabilities were presumably even greater coz NETA presented a loss for both FY2017 & FY2018, statements that were met by disclaimers of opinion from the auditors (in the URL above, just insert the relevant year).
Things have since improved. The latest audited net liabilities, at 30Sep2021, are $1 241 649, a shift of $3 283 989. However, this has had little to do with operating performance – 5yrs of trying yielding a mere $16 566, unaudited (coz it involves the FY2019 record that was effectively rejected) – and was all down to three liabilities adjustments agreed to by the auditors, one in each year of the FY2019-FY2021 period:
• $427 677, the ‘KPFA property tax hiccup’ (convincing the California State Board of Equalization to accept that the tax shouldn’t have been levied) – FY2021 auditor’s report (p. 4; p. 6 of the PDF), https://pacifica.org/finance/audit_2021.pdf
• $477 918, provision for the pension plans liability (this portion was eliminated when Pacifica finally rectified the neglect). And now? Is there neglect? Even negligence? Are the two 2019 pension plans audits completed & filed with IRS, etc.? The two for 2020? The two for 2021? Have those auditors been paid in full for their work? . . . Not a word, from the PNB Finance Cttee, or the PNB Audit Cttee, or the directors sleepwalkers . . . The two plans: a 403(b)-defined contribution retirement plan, & a profit-sharing plan (sic); they are known in Pacificese as ‘the 403(b) Plan’, & ‘the Pacifica Retirement Plan’ – FY2020 auditor’s report (pp. 5, 24-6; pp. 7, 26-8 of the PDF), https://pacifica.org/finance/audit_2020.pdf.
And the recent cost to the Pacifica members & the other donors? It’s disclosed in the auditor’s reports. To take the FY2017 one, the total is in the functional expenses statement, p. 7 (p. 9 of the PDF), with the previous year’s on the next page; & the sum for each plan is in a note, p. 21 (p. 23 of the PDF). The charge for the last five years (total, 403(b), profit-sharing): FY2017, $150 288, $61 736, $88 552; FY2018, $103 944 (incorrectly given as $103 940), $52 540, $51 404; FY2019, $134 640 (incorrectly given as $134 741), $53 202, $81 438; FY2020, $120 067 (an incorrect figure was given, see below), $58 289, $61 778; FY2021, $126 279 (ditto, see below), $65 439, $60 840. These total as $635 218, $291 206, $344 012. (And the year before this period, FY2016? $425 399, $70 483, $201 941 – with no explanation by the auditor of the unidentified $152 975. An ‘indeed’ – to both the anomalous total charge (x~3), & the absent explanans. And to the 6yr charge being >$1m.)
Note, the FY2020 & FY2021 auditor’s reports give three wrong totals in the functional expenses statements: they’ve solely taken the 403(b) plan figure. Presumably the profit-sharing total was mis-posted to “Employee benefits”. Not spotted either year by the auditors, the PNB Audit Cttee, or the PNB. The FY2020 error was repeated in the ‘copy & paste’ into the FY2021 auditor’s report – will anyone stop them next year? Auditor’s report, FY2020, p. 7, p. 9 of the PDF; ditto, FY2021, pp. 6-7, pp. 8-9 of the PDF.
Odd is the very wide range of per capita 403(b) charge between the operating units (formerly termed ‘the divisions’). For FY2020: WPFW $268, WBAI $283, stepping up to KPFK $640, KPFA $668, KPFT $733, & all contrasting with PNO (includes PAN) $1 953, PRA $2 168. Why? (Sources: auditor’s report FY2020, & Oct2021 NETA-produced net income statements (using the comparative). FY2021 data can’t be used coz the NETA figure is way off the auditor’s: auditor agreed the total charge as $65 439, but NETA has $55 244 (Oct2021 set). Whereas the FY2020 totals are, respectively, $58 289 & $58 317. The unit-level charge isn’t in the auditor’s report, only the monthlies: KPFA $19 026, KPFK $16 317, KPFT $2 200, WPFW $2 282, WBAI $2 119, PNO (includes PAN) $8 787, PRA $7 587. The number of full-time equivalents is computed using $80k (see appendix to the 19Nov2021 post) as the per capita personnel cost: KPFA 28.5, KPFK 25.5, KPFT 3, WPFW 8.5, WBAI 7.5, PNO (includes PAN) 4.5, PRA 3.5, totalling 81.)
• $2 361 828, the write-off of the Democracy Now! debt – FY2019 auditor’s report (p. 4; p. 6 of the PDF), https://pacifica.org/finance/audit_2019.pdf. It was first publicly disclosed by Pacifica Executive Director Maxie Jackson, to the 12Mar2019 PNB Finance Cttee (17:53) – https://kpftx.org/archives/pnb/finance/190312/finance190312a.mp3. No-one asked why Amy waited 5mths to tell Pacifica. And no Pacifica employee or officeholder has described how DN! chose to manage that debt, but it is in their public record (especially the 2017 IRS Form 990, stamped received 20Nov2018): debt at 31Dec2017, $2361828 = 807000 (doubtful debt provision made FY2012, so both removing it as an asset from its balance sheet (but still leaving it money that Pacifica owed: it wasn’t being treated as uncollectible, a bad debt), & charging it as an expense) + 777000 (FY2017, both removing it as an asset from its balance sheet, & charging it as an expense, in the form of a grant) + 777828 (FY2018, ditto). Like in Iraq, a phased withdrawal. (Obvious Q, asked by no-one: has Pacifica Foundation, Inc. been invoiced since 31Dec2017 for airing DN!, now getting on for 5yrs? That Pacifica may be getting it for nowt or close to is suggested by the change in the pattern of DN!’s annual total broadcasting fees, FY2005-FY2020, with the level falling across 2012-14 from $1.1m to <$200k – when it was decided to start to unload Pacifica from the balance sheet, beautifying the accounts receivable figure, putting a stop to its rise, avoiding a flashing red light.)
DN! is the commodity of Democracy Now! Productions, Inc., founded in 2002 (per its 990’s). How’s it doing? FY2020, coinciding with the calendar year, per their latest 990 (the auditor’s report wasn’t filed with the NYS Attorney General’s Charities Bureau, https://charitiesnys.com/): total revenue $11 442 800, total expenses $8 267 813, net income $3 174 987; total assets $36 302 179, total liabilities $659 173, net assets $35 643 006. (And Pacifica? FY2020, thru 30Sep2020, link above: total revenue $11 507 060, total expenses $11 241 966, net income $265 094; total assets $3 689 886, total liabilities $4 916 323, net liabilities $1 226 437.)
Here are the unaudited FY2021 net income statements of the 5 stations, per the NETA-produced Sep2021 monthlies. They’re adjusted to exclude the windfalls: the forgiving of the two loans received from the Paycheck Protection Program that benefited all stations, & a property donated to WBAI.
• why the PPP amounts had to be estimated: “[t]he distribution of PPP #1 (& #2, for that matter) hasn’t been made public. But in the NETA monthlies are the Jan2021 & Aug2021 totals for ‘Miscellaneous/Other Income’, within which they’re posted. The Jan2021 totals per the July monthlies, the latest to have PPP #1 posted within FY2021: KPFA $440 828.47, KPFK $393 653.02, KPFT $58 199, WPFW $141 119.64, WBAI $126 557.47, PNO $50 180.54, PRA $46 755.67, consolidated as $1 257 293.81. That’s $663.81 more than the loan – and, indeed, that’s the figure left in the Jan2021 statement of the Aug2021 monthlies, when PPP #1 was deleted from the FY2021 consolidated & put in the FY2020 one. With no other info, in the KPFK computation above, the perhaps overstated $393 653 has been used” – link just given, in the ‘Discussion: General’ section, problem P#5. The size of the forgiven loan: “[t]he PPP loan [#1] was granted to the Foundation on June 19, 2020 in the amount of $1,256,630” (p. 19; p. 21 of the PDF) – https://pacifica.org/finance/audit_2020.pdf.
• the revenue data in the Sep2021 monthlies differ from those in the Aug ones. There’s no change for KPFK, WPFW, & WBAI. However, KPFT has 1 change: the June2021 ‘Listener Support’ was reduced by $200. And KPFA has 9 changes, almost half of them material: 3 were unchanged (Oct, July, Sep); 5 differed by <$5k each; but 4 were larger, with Dec rising by $39 757, Jan falling by $48 377, Feb falling by $127 606, & Mar rising by $373 303. Booking adjustments are made all the time, but management are interested in patterns. It would be reassuring – not least because KPFA’s bookkeeper, Maria ‘if you don’t stop your nasty questions I’m off this call’ Negret, has been holding up the production of NETA’s monthlies – if CFO Anita Sims provided a written public explanation of why the last 4 bookkeeping totals were changed.
R Paul Martin on the bottleneck: “[at the 9Nov PNB Finance Cttee,] NETA Controller Julia Kennard substituted for the interim CFO […] She said that she hoped that the September financials would be out soon. She said that KPFA is still getting their revenue numbers in, and that it always takes long time to get that in. She said that she didn’t know why the software KPFA uses makes that a challenge” (p. 2) – https://glib.com/treasurers_report_2021-11-10.pdf. Fiefdoms. Provincial priorities. The Berkeley Hillbillies.
The KPFA material differences: Dec2020 rising $39 757 (562875 ⭢ 602632), Jan falling $48 377 (604089 ⭢ 555713, rounding), Feb falling $127 606 (381092 ⭢ 253485, rounding), & Mar rising $373 303 (374292 ⭢ 747595).
• KPFT Aug2021 tower rent charge: all year the charge is ~$6 500 rising to ~$6 700, except for Aug, which is ~$776. With no explanation given, it’s prudent to add $6k.
• depreciation estimate: this charge is absent, as a matter of course, from the net income statements constituting the NETA monthlies. It’s computed from the relevant asset balances destined for the balance sheet, a statement that first appears when it’s presented to the auditors. Given this, as mentioned, the estimate used is simply the audited FY2020 charges found in the auditor’s report (p. 36; p. 39 of the PDF) – https://pacifica.org/finance/audit_2020.pdf. Note that KPFA’s charge is anomalous in Pacifica terms, & exactly x5 that of KPFK: they’re buying assets, presumably to improve their service to the listeners, whilst the struggling stations are dying on their knees . . . this is the inverse of the implementation of a Pacifica network development plan. We need a rational response to the uneven & combined development that is Pacifica Foundation, Inc. – as The Lion may have put it.
. . . KPFK is in the distance, just left of centre, set in the Hollywood Hills; the transmitter is upper right, Mount Wilson; foreground is that urban beauty, Pregerson Interchange, with Harbor Freeway (Interstate 110) heading north, & Century Freeway (I-105) running west-east . . . LA, 2009 – not a composition by the excellent Edward Burtynsky, 60 x 75 ins. (a sight to behold) . . .
[Today is another example of the civilisatory decay that is the USA. Rittenhouse shows there’s no safety on the streets. The coming history, exacerbated by elections, will show that Rittenhouse isn’t an anomaly. Some social scientists, including political strategists, have used an approach glossed as ‘in & against the state’; now we shall see an acceleration of ‘in & with the state’. Intensifying the integral state. Vigil, Latin = awake. If you can’t make it into the police & military, making a career out of defending the social order, no prob: just serve the community, do some community organising, weaponising it with a vigilante group, protecting women, property, the good life, apple pie. Acting local, thinking national. Awake, stay woke, be watchful, then act, extinguishing the danger. Fair & reasonable. Right & proper. Erwachen, Amerika! Vigilantes, the new social justice warriors. Another new golden dawn for Amerika.
[Meanwhile, back in PacificaWorld . . . this is the first of three posts on KPFK’s crisis. Programming has turned away listeners; only one net income in the 15yrs, FY2006-2020. It has meant that for the period, the gross cumulative loss is ~$2.851m (an average of ~$204k per deficit year), & the net cumulative loss is ~$2.732m. What’s different now is a reinforcing dynamic: the station’s rate of pecuniary loss has a velocity escaping the ability of Pacifica to amass cash to pay creditors. It’s inevitable that KPFK will continue to shrink. But the crisis only becomes existential for Pacifica, & KPFK, if there’s excessive delay – worryingly, a delay already displayed by the directors & Executive Director Lydia ‘Fabian’ Brazon since Jan2020, so before the epidemic started in southern California.
[(This post is long, so it’s also made available as a four-parter.)
[The other two posts in this KPFK triptych: the latest fund-drive, Tu5Oct-F5Nov; & its immediate context, the fund-drives since Oct2018.
The great & the good haven’t told us – but their documents show the reality. The headline is where KPFK, & Pacifica, is at.
Why bother to estimate KPFK’s current rate of loss-making? Because the scale of loss-making per unit time, such as per month, needs to be known by management, especially in giving meaning to estimated cashflow. It provides a baseline: if nothing changes, & the current financial performance persists for 12mths, say, this is how bad it’ll be. The presentation of this figure with evidenced argument isn’t in the public domain – hence this attempt. The current rate of loss-making is a measure of the generative power of the present, a representation of the present as future, the unfolding of what’s already there.
To be clear, the formulae used here are an attempt to estimate KPFK’s current rate of loss-making, & then using the typical period of one year to illustrate its meaning. Judgement is applied to the latest available historic info to put a number on each of the constituent variables. The result is an estimation of KPFK’s total loss at 5Nov2022 if nothing changes.
The KPFK headlines, not read on the Pacifica Evening News:
• current total revenue, annualised: $1 674 811 per year . . . $139 568 per month . . . $4 588 per day
• current total expenses, annualised: $2 936 208 per year . . . $244 684 per month . . . $8 044 per day
• current rate of loss-making, annualised: $1 261 397 per year . . . $105 116 per month . . . $3 456 per day
• so, loss-rate of over $1.25m a year . . . over $100k a month . . . over $3k a day
• cuts needed to be in balance: 43% (42.96)
This is an emergency. Pacifica needs to act urgently. The directors & senior managers need to act as a Cttee on the Present Danger.
The coming seven sections, some quite petite, plus an appendix:
•1• the Th18Nov PNB rises falls to the occasion
•2• “[t]he financial goal would be to balance our FY22 budget against our lowest-income expectations” – KPFK station manager, Miquel Calçada, Su17Oct2021 KPFK LSB
•3• the ‘in balance’ unargued mantra
•4• formulae re current loss-making: total revenue; total expenses
•5• assumptions re current loss-making, & why: general; revenue; expenses
•6• workings re current loss-making: total revenue; total expenses; total loss
•7• discussion: general; revenue; expenses
•A• appendix: how many employees work at KPFK? the average personnel cost?
. . .
•1• The Th18Nov PNB rises falls to the occasion
This scale shows how naive were the proceedings at last nite’s Pacifica National Board meeting. Otherworldly. It really was. Saving $30k here, $40k there. Simply doesn’t cut it.
The pearls of wisdom adorning our leaders, for all to see:
“Um, ok [pause], argh [pause], it’s a serious situation and, urgh, it’s pretty obvious that we have to do something” (PNB Chair Alex ‘Miguel, report to me in 3 minutes, & Blair, you’re a loser, get outta here’ Steinberg, WBAI listener-delegate, 12:35 into the KPFK item – https://mega.nz/file/xNlShAQD#D-BDaZRtl3-kZZSiGXSmi3GkaMH7KlJWd19XLfxbkmk; not yet in the meetings archive . . . [UPDATE: still not at https://kpftx.org/archive.php as of F10Dec. For more than 6wks now, there have been less audiofiles in the archive. Obviously coincidental.]) . . .
. . . Alex. Exercising all his skills & expertise honed from tens & tens of meetings chatting on the PNB Strategic Planning Cttee, a body that even now has only produced one document, on 5Jan2021 (4:14) – https://kpftx.org/archives/pnb/pnbstratcomm/210105/pnbstratcomm210105a.mp3. A document so important it took over 7wks before the PNB bothered to look at it, on 25Feb (13:18) – no minutes at kpftx, but audiofile, https://kpftx.org/archives/pnb/pnb210225/pnb210225b.mp3. Then promptly buried – never put on a Pacifica website, never cited in public. Never. That’s been its practical value. Even its title is wrong: “Strategic Recovery Plan for Pacifica Radio, Inc.” – but then Alex had only been first seated as a director on 29Jan2010, & when submitting the doc he’d only been in post for a year as Chair of the Board of Directors, the custodians & trustees of the assets of the public charity registered as Pacifica Foundation, Inc.. Jesu.
PacificaWatch found the doc on the Aaron/Rosenberg anti-breaker 2nd-referenda site, Pacifica Democracy Project, & even there it was buried in ‘Resources’ – but it’s so thin, physically & conceptually, why the surprise – https://pacifica-democracy-project.org/documents/strategic-recovery-plan-approved-feb-25-2021/. It’s a mere 4½ pages. Occupying two pages are all of “Emergency Strategic Plan: Immediately address deficits at the stations” (I kid you not), “Short Term goals: Addressing the Loan” (ditto), & “Medium term goals: Restore CPB funding” (I give up). This left the opportunity for musings, some sky-blue thinking, as in “I wandered lonely as a cloud / That floats on high o’er vales and hills”, freeing Alex to discourse for 2½ pages on “Long Term Strategic Plan and Goals”. Priorities. Easier to think of the future than the present. Perhaps an expression of his political formation.
Ah, the PNB Strategic Planning Cttee. A jewel in the crown of recent PNB’s. A light not to be hidden under a bushel. Its gestation was the late 2017-early 2018 threat of bankruptcy, transformed into debt, courtesy of the Foundation for the Jewish Community, known to most as FJC. The Cttee first met 12Mar2018, &, like a photo of a 1918 Bolshevik Central Cttee, only Cdes Alex & Jan of the original 11 are left standing (& they topple off the mortal coil of PacificaWorld in a few weeks’ time, terming out): Carole Travis (not McMichael), Mansoor Sabbagh, Joseph Davis, Alex Steinberg, Tony Leon, Tom Livingston, Nancy Sorden, Janet Kobren, Jan Goodman, Efia Nwangaza, Sam Agarwal. (The memories, the memories.) The Cttee’s purpose: “[t]he mandate of this committee is to propose to the PNB the implementation of a financial recovery plan to address both the short term and long term requirements of the Pacifica Foundation. As such this committee is charged with the responsibility to consider all options for raising funds and/or liquidating assets as well as restructuring the business model of Pacifica” (emphases added – minutes of the inaugural meet, 12Mar2018, https://kpftx.org/archives/pnb/pnbstratcomm/180312/pnbstratcomm180312_5420_minutes.pdf). Never got near. But not for lack of trying. In 2018 met 15 times. In 2019 met 11 times. In 2020 met 11 times. Then the golden dawn on 5Jan2021, the 38th meet. Being on a roll, why stop? Met 9 times since. And there’s still another 6wks to the year. For their 50th, maybe they’ll give each other medals. Especially as there haven’t been any new draft docs to hand around. Stakhanovite – and yes, Стаханов was an Алексей, Alexey.
(And Chair ‘Fabian’ Steinberg is displaying bad manners as he tries to cope with a situation he has helped create. It seems almost as an afterthought that Miquel was even invited to the meeting, causing him to put it on the record that “I have the encouragement of my iED – I cannot talk the same way regarding the PNB. I was aware of my presence in this meeting just half an hour ago, and this is an urgent meeting to discuss KPFK financial situation” (49:08, emphases added; an intelligent verbatim transcription; responding to a question from DeWayne Lark, 2020 PNB Vice Chair, & KPFT listener-delegate, but crashing out in the recent LSB election to the likes of Sister Mama Sonya, but achieving the rank of 5th alternate – could have been worse). And then the dismissive disdain delivered to KPFK Finance Cttee Chair Fred Blair by a 1-2 from ‘Fabian’ & his side-kick, PNB Finance Cttee Chair James Sagurton sounding like one of Jimmy Hoffa’s capos with his “do we want him back for the closed session?”, evoking from ‘Fabian’ a bored “I guess so, huh” (53:46). Uncouth. This followed the attempted humiliation of Fred by ‘Fabian’ the week before, as if he was personally responsible for the disastrous fund-drive (15:21) – Tu9Nov PNB Finance Cttee, https://kpftx.org/archives/pnb/finance/211109/finance211109a.mp3. Deplorables.)
And the pearls from last nite’s PNB just kept on glistening:
“[s]o, argh, so your budget will be reduced by about 70 [$70k] a year just with that one [cough] excuse me – that one, argh, re-do of our telephone services” (Executive Director Lydia Brazon, 13:15 into the item);
“I don’t want to fill you in-in-in peanuts, like printers. We have seven printers [laughs], in a station that doesn’t print, that we have to pay our-our-our, argh, um – anyway. Argh, so these are minimum things. There are other things that-that concern me, but even this-this [sic] lil things, um-um, it’s really frustrating and difficult to move, argh, to move ahead” (GM Miquel ‘yes, I am indeed as demoralised as I sound’ Calçada, 22:34) . . . Miquel, better get used to it – or resign & spend Christmas in Catalonia.
The luminaries of the PNB Finance Cttee also couldn’t wait to get in on the act:
Chair James ‘oh, R Paul, I didn’t tell you Berthold was presenting the FY21 budget tonite?’ Sagurton (WBAI listener-delegate) tried to move a motion, Chair Steinberg & ED Brazon asphyxiated him, Jim cried out with a “[sigh] I’m going to object to that, mmm [whimper]” (45:07), the assault continued, there was no ‘I appeal the ruling of the Chair’, & the world was to hear no more;
loser in the Chair election, Chris ‘I’m no Sisi’ Cory (KPFA listener-delegate), knowing there’s no point being on a committee unless you speak, spoke, excelling himself, exercising all his critical faculties, eliminating tertiary, even secondary questions, getting right to the heart of the matter, putting his query to Miquel, crafted, concise: how many members does KPFK have? (50:38) . . . bless us & save us. (‘Janus’ has just won a staff-delegate seat, & if the rulers of the KPFA LSB deign to follow by-law Article 4, Section 8 next month he’ll be seated in a seat with armrests . . . but the meetings archive shows that not even one KPFA meeting is noticed, for anything . . . his term ends c. 1100 PST 14Jan2023 (first seated as per https://kpftx.org/archives/pnb/kpfa/170114/kpfa170114_4792_minutes.pdf), maxing out the 6yrs, with Richard Wolinsky the 1st staff alternate. [UPDATE: a LSB was noticed 24Nov for Sa18Dec.]); &
Beth ‘I’m really Queen Liz III, but no need to bow – well, not until I become Chair of the PNB, ascending another throne’ von Gunten (KPFK listener-delegate) found the proceedings somewhat common, & to avoid being sullied, refrained from comment, preferring the dignity of silence whilst dining leisurely in her chambers with a slice of Marie Antoinette & a cup of Earl Grey – served to her on a silver tray, of course. The Queen of PacificaWorld distains public proceedings, preferring privacy, unencumbered by all those CPB rules, safely ensconced, from prying eyes, secreted away, deciding Pacifica’s future. The Golden Age of Appointed Boards, GAAB, was so much more suited to the disposition, to the station, of Her Maj.
However, the other director on that Cttee, Julie Hewitt (WPFW listener-delegate), was a lil different:
“one thing that’s kind of interesting about this conversation so far is that we have spent a lot of time talking about telecom, and, you know, even if we started realizing that $70,000 savings tomorrow, argh, that wouldn’t knock a dent in but one month’s deficit, and so that’s the sense in which I think we need to make sure that we don’t focus too much on one thing, and make sure that we’re looking at the big picture, and honestly, um, you know, what-what I think we really have to do is come up with – I say ‘we’ coz I want to think of this as one Pacifica, right – um, think of a way that we’re gonna really raise revenue because there really isn’t, um, you know, a cushion of cash around the Foundation that-that we can, you know, kind of let KPFK work itself out, work its issues out over time, and so what I’m hoping is that, urgh, your work with the LSB will-will turn out to be fruitful in-in the very near term, and then if it really isn’t, that you have a Plan B that you start executing, you know, where you’re maybe asking some of the other stations for help in terms of pitching because if you don’t have people who are good at it at KPFK, urgh, or who are experienced, maybe, you know, folks from other stations can help you out, at least through this December pledge-drive, and really make this December pledge-drive a kind of a bang-up, urgh, you know – do other kinds of advertising to make sure that people are listening to the station, you know, use your networks of people to, you know, post things on Facebook, and-and Twitter, and what not, to-to-to build up your listener base” (26:07, emphases added – this all the more impressive for Julie probably not being aware of the composition style of Thomas Bernhard).
“[M]ake sure that we’re looking at the big picture”. Now there’s a thought . . .
But no sooner was the very idea mentioned, the blank canvas was turned around, the frame propped against the wall, out of mind’s eye. Instead of inspiring the outline of an approach, it died. There & then. Not even evoking a glimmer of enlightenment from others. Not even a mumbling of the p-word – except in a remark by Lawrence Reyes (15:22), KPFK listener-delegate, so un-serious that he didn’t even follow it up when Miquel evaded.
But all this happens when the directors fail to provide leadership. Passive. Thru & thru. The directors: allowing themselves to be overrun by events – well, allowing KPFK to be drowned in debt. But then, if one station bites the dust, run on a minimal budget, just like KPFT has been these last 6yrs, then maybe that’s not so bad coz it reduces competition for cash when the next station ‘falls’ on hard times. Hostile brothers, if not sometimes “einen Kampf der feindlichen Brüder”, a struggle between enemy brothers, as Chuck put it.
•2• “The financial goal would be to balance our FY22 budget against our lowest-income expectations” – KPFK station manager, Miquel Calçada, Su17Oct2021 KPFK LSB
If he’s a man of his word, & not a hypocrite, the budget will be ~$1.675m. That means cost-cutting of ~$1.261m (2.936 − 1.675). That’s 43%.
For an accounting unit, a station, to be ‘in balance’ is neither an operational imperative nor a moral one. No. Concerning money, the relevant organisational unit is not a station but Pacifica; therefore the relevant accounting unit is not a station but Pacifica. This is the conceptual framework for a substantively rational Pacifica budget-formation process, one that prioritises amongst the needs of the constituent operational units, the stations. This means there has to be a Pacifica network development plan – the expression of a comprehensive vision. From this is derived how much each station gets to spend.
Framework-&-plan is the best reason for rejecting the ‘pull y’self up by y’bootstraps’ folk naivety, the self-financing idea for the parts of the whole.
Ok, a comprehensive vision is a somewhat un-Pacifican idea for many, but it’s needed to meet the urgency of already being in the 3rd decade of the 21st century, & over 50yrs since the glory days of the anti-Vietnam war demonstrations. RealWorld has moved on. PacificaWorld hasn’t. Suffocating in a time warp. The radio isn’t what it used to be. But what’s going on is a lot more than what’s to hand: it reaches much, much further, for a new horizon has opened up for humanity: digitisation. As I put it June last year, in an earlier appeal for an approach adequate to the scale of Pacifica’s problems:
[i]n any case, a radio signal isn’t what it used to be. Digitisation has caused broadcasting to be transcended by providing. The broadcast schedule, transcended by the download list. The position on the dial, transcended by reputation, sustained by social media, enhanced by branding. The radio, transcended by mobile digital devices. Radio is 20th century, it’s passé. It’s one reason why the BBC since 2018 no longer speaks of radio but of ‘sounds’: not a device, but an output.
Under present conditions, only a signal-swap can provide the necessary cash for implementing a Pacifica network development plan. That’s out of the picture, if only because agreeing a swap can take a number of years. Therefore, present conditions need to be changed not from without but from within: the course of action required is creating the political conditions for a planned, holistic, systematic shift of spending from KPFA to the other stations – not so much to stop their suffering but to give them the cash to have the opportunity to flourish. There is no other possibility. Obviously it requires a thorough overhaul of management – national & especially station – to ensure that the money is spent not just in a satisficing way but in an exemplary way. As reactionaries are quick to say, every crisis is an opportunity. It’s about time Pacifica learnt from the enemy.
If this doesn’t happen, not Groundhog Day as such but Groundhog Day in a tailspin. As the tormented Sardinian hunchback with the Albanian name put it, “[l]a crisi consiste appunto nel fatto che il vecchio muore e il nuovo non può nascere: in questo interregno si verificano i fenomeni morbosi piú svariati” – the crisis consists precisely in the fact that the old is dying and the new cannot be born; in this interregnum a great variety of morbid phenomena appear.
But don’t the Articles of Incorporation require station self-sufficiency?
A common belief, yes, but no, a mistaken belief. Article II identifies purposes, & sub-article (b) says, “[t]o establish and operate for educational purposes, in such manner that the facilities involved shall be as nearly self-sustaining as possible, one or more radio broadcasting stations […]” (emphases added; article as amended 19Aug1948 – https://pacifica.org/articles.htm). So facilities, not stations – & it’s deliberately said this way to be consistent with the originary funding conception: paid for by the members & listeners, not outsiders, such as grantors & underwriters.
So not saying ‘in such manner that the stations involved shall be as nearly self-sustaining as possible’. So not saying ‘To establish and operate for educational purposes one or more as nearly self-sustaining as possible radio broadcasting stations‘. So not saying ‘To establish and operate for educational purposes one or more radio broadcasting stations, each of which shall be as nearly self-sustaining as possible’. No: the “self-sustaining” pertains to “the facilities”, undifferentiated facilities, the facilities collectively – not the facilities of each individual station. That’s why the particular concerning “the facilities” is slotted in, splitting the sentence – so much so, it warrants being enclosed by a pair of dashes, not commas.
That’s why Pacifica needs a network development plan – to stop the firefighting that inevitably arises because not all stations are adequately resourced to achieve resilience with a stable cashflow, making them vulnerable when adversity strikes; & the firefighting has been continuous because some stations have been allowed to degenerate, & languish. Rooting Pacifica in the present, never envisioning the future. But will Pacifica political conditions ever allow such a plan?
The remaining sections:
•4• formulae re current loss-making: total revenue; total expenses
•5• assumptions re current loss-making, & why: general; revenue; expenses
•6• workings re current loss-making: total revenue; total expenses; total loss
•7• discussion: general; revenue; expenses
•A• appendix: how many employees work at KPFK? the average personnel cost?
. . .
•4• Formulae re current loss-making: total revenue; total expenses
• total revenue = fund-drive revenue + background listener support & donations + other revenues
= (120 days x 5836 pledged daily x 0.78 fulfilled, the last two per the 5Oct-5Nov drive) + (245 days x daily average of April & July 2021, per the Aug2021 NETA-produced monthlies’ KPFK net income statement) + (other revenues, per the FY2020 auditor’s report, p. 34, being p. 37 of the PDF)
• total expenses = 12 x average of June, July, & August 2021 expenses, per the Aug2021 monthlies’ KPFK net income statement
• To be clear, these formulae are an attempt to estimate KPFK’s current rate of loss-making, then using the typical period of one year to illustrate its meaning. Judgement is applied to the latest available historic info to put a number on each of the constituent variables. The result is an estimation of KPFK’s total loss for the year thru 5Nov2022 if nothing changes. One doesn’t need reminding that the $3.165m loan from FJC, taken out 2Apr2018, falls due at this time, on 30Oct2022 (FY2019 auditor’s report, p. 15, being p. 17 of the PDF; that for FY2020, p. 16, being p. 18 of the PDF).
•5• Assumptions re current loss-making, & why: general; revenue; expenses
These follow the sequence of the terms in the formulae.
• In this attempt to estimate KPFK’s current rate of loss-making there’s no fine tuning, no adjusting of published figures. Both uncertainties & contingencies are many, plus the latest info in the NETA monthlies is August, so almost a quarter of a year ago. Adjusting would only create the illusion that precision is accuracy. We also have to accept, as with the climate emergency, that tipping-points, unknowingly, may have already been passed – our knowledge imperfect, even dangerously so.
• Assume 120 days in drive. A 1:2 split for the year. (For FY2021, so thru 30Sep2021, drive really was driven: a mind-numbing 186 days, 51% of the year (dates given below). Pausing to absorb this, one’s reminded of the title of a memoir by Frigyes Karinthy, Utazás a koponyám körül – A Journey Round My Skull.)
• Let the daily pledged be the average of the last drive, 5Oct-5Nov, $5 836 (186761 ÷ 32 days) – KPFK Treasurer Fred Blair (10:06) to the 9Nov PNB Finance Cttee, https://kpftx.org/archives/pnb/finance/211109/finance211109a.mp3. (Although, with KPFK in decline, it can be reasonably argued that this figure should be slightly deflated for the coming 12mths, not least because of donor fatigue; however, doing so by 10%, say, wouldn’t cause a material change given the rate of loss-making.)
• Let the fulfilment rate be the latest provided, 78%, as per the “about 78%” on Tu9Nov from Chair Blair, big cheese of the KPFK Finance Cttee, a veritable double-air cheeseburger, melting into oblivion (answering a query at that PNB Finance Cttee from Chair James Sagurton (30:18) – link above). The previous rate given publicly was 76.8%, by KPFK business manager Barry ‘The King’ Brooks (18:17), for the Tu20Apr-F4June drive (16June KPFK Finance Cttee – https://kpftx.org/archives/pnb/kpfkfin/210616/kpfkfin210616a.mp3).
• Background listener support & donations:
(a) there’s no one-to-one mapping between the NETA monthly revenue categories & those appearing in the subsequent auditor’s report: the unaudited monthlies have “Listener Support”, “Website Income”, & “Major Donor Income >$1K/Yr”; whereas the auditor’s report has “Listener support and donations, net”, & “Grants & contributions”.
Re KPFK’s FY2020 revenue, the Aug2021 NETA monthlies give ‘Listener Support’, $2 108 695; ‘Website Income’, $409 470; & ‘Major Donor Income >$1K/Yr’, $67 868; whereas the auditor’s report gives $1 951 112 for ‘Listener support and donations, net’ (p. 34; p. 37 of the PDF). That’s why ‘Website Income’ can’t be assumed to be solely from listeners – although one wonders who else gave the money & why. (These docs are linked at the end of this ‘Revenue’ section.)
The auditor’s report has only one other sizeable revenue category: ‘Grants and contributions’, $644 644. Audited total revenue is $2 635 743. This contrasts with the unaudited NETA total of $2 793 326 – an overstatement by $157 583 (~6%, 2793326 ÷ 2635743 ⇒ 5.98%). It would be nice to see an explanation of this, & others & similar – maybe the KPFK Finance Cttee can ask NETA.
Pacifica, if only as a courtesy to the members, staff, & listeners should have a publicly available note explaining the mapping. In that absence we have the spectacle of the elite parading in front of the plebs: the insiders talking about x, y, z when hardly anyone is in a position to contradict them or even ask an informed question. The quiet work of the info gatekeeper usually goes unnoticed & unrecognised, invisible, taking the form of the presence of absence – but this sentinel is essential for the Pacifica secrecy culture;
(b) given no explanation of the mapping, a paucity of information, & even less confidence in the posting accuracy of station-level bookkeeping, not least because Pacifica doesn’t use a uniform chart of accounts, the only rational course is to solely use ‘Listener Support’, per the August monthlies, for the auditor’s category, ‘Listener support and donations, net’. The April & July 2021 totals are taken because they’re the only months in FY2021 largely free of fund-drive, & less likely to have received money from the previous drive: 19 days free in April (the previous one ended 7Mar; re-started 20Apr); 19 days free in July (the previous one ended 4June; re-started 20July). No adjustment has been made to them not being free of drive days – again, immaterial given the scale of KPFK’s rate of loss-making; &
(c) no deflator applied to the April & July 2021 totals, as just reasoned.
• The expenses are calculated as the average of the June, July, & August 2021 totals, per the August monthlies. The last three months are used because (a) the trend in 2021 is downwards; (b) July is 6% up on June; (c) August is suspiciously low given that being all month in drive, many of the associated costs weren’t there, not even as invoices from previous drives: within the much reduced ‘Development Expenses’ there was no ‘Telemarketing’ charge, & the charge for ‘Premiums from Other Vendors’ was way down; & so, (d), it’s prudent to average total expenses over those 3mths.
• The depreciation charge is absent, as a matter of course, from the net income statements constituting the NETA monthlies. KPFK’s is so low it makes no sense to use an estimate in the current exercise. (Audited FY2020’s for KPFK was $15 461 (p. 36; p. 39 of the PDF), & for Pacifica, $154 415 (also at p. 7; p. 9 of the PDF); KPFA’s charge is anomalous in Pacifica terms, & exactly x5 that of KPFK: they’re buying assets, presumably to improve their service to the listeners, whilst the struggling stations are dying on their knees . . . this is the inverse of the implementation of a Pacifica network development plan – https://pacifica.org/finance/audit_2020.pdf.)
total revenue = fund-drive revenue + background listener support & donations + other revenues
annualised total revenue from 6Nov2021 = (120 days x 5836 pledged daily x 0.78 fulfilled, the last two per the 5Oct-5Nov drive) + (245 days x daily average of April & July 2021, per the Aug2021 NETA monthlies’ KPFK net income statement) + (other revenues, per the FY2020 auditor’s report)
= (120 x 5836 x 0.78) + (245 x ((47899 + 62636) ÷ 61)) + (2635743 − 1951112)
annualised total loss from 6Nov2021 = 2936208 − 1674811
= $1 261 397
•7• Discussion: general; revenue; expenses
Most of this section draws attention to various non-trivial defects in the NETA-produced monthlies, the set of nine net income statements. But first, a demonstration that, despite the bland picture painted by the leaders, each Pacifica station made a FY2021 loss once extraordinary revenues are removed, the losses aggregating as ~$1.79m. This is then followed by two features of the KPFK fund-drive, discerned when one generalises from the monetary performance of the last one, Tu5Oct-F5Nov.
• When windfalls are removed, what’s the estimated FY2021 financial performance? Each station made a loss. Was it KPFA that made the smallest loss, ~$66 847? The answer may surprise you . . .
• But back to KPFK. Ever wondered how much extra comes in because of a fund-drive? It must be a fair bit, yes? No. These days it’s surprisingly low: the extra is only 1½ times the drive-free figure (per day, $4552 − 1812 = $2 740; & 2740 ÷ 1812 = 1.51; details above, in ‘Workings re KPFK annualised total revenue’).
• And that isn’t the biggest surprise: having drives now brings in less than an extra ~$102 300 for the year (546240 − 443940; computation below) – ‘less than’ coz that’s the gross figure, the fulfilment of the pledges. It excludes the cost of fundraising, those such as premiums, post & packaging, hiring pitchers, borrowing existing staff deployed elsewhere (albeit a sunk cost: already incurred, but a cost of this activity), call-centre charge, payment processing. Computation: if fund-drives total 120 days, the drives bring in $546 240 (120 x 4552), & the rest of the year brings in $443 940 (245 x 1812). The pledge level is now so low that, counter-intuitively, drives may bring in less money, less net income, than if the station had no drives at all. It would be a good idea for KPFK management to do a more accurate set of calculations, for different scenarios, & think the matter thru.
. . .
• Now the NETA monthlies. Six examples of the problems, P#1-P#6. Financial statements are standardised, communicating to the world a particular kind of monetary expression of the organisation. By contrast, management statements, using elective constituent account categories, are a monetary expression tailored to the decision-making needs of managers. For them, primary is timeliness, secondary is accuracy. They need to act using information generated by the accountants, a trusted team because of their earnt reputation for producing info that is credible enough to function as practically adequate knowledge. The most efficient organisations have these statements within days – Pacifica distributes theirs, at best, 6wks after period. Not good. And even then, it’s only a set of net income statements – never aged accounts payable (the many creditors) or aged accounts receivable (the few debtors), or a balance sheet, or a bank reconciliation statement. There you go, says Lydia.
• P#1 … The NETA monthlies are a set of nine net income statements: Pacifica as a whole (the ‘consolidated’ tab), & the eight accounting units (five stations, plus PNO, PRA, PAN – Pacifica National Office, Pacifica Radio Archives, Pacifica Affiliate Network (it’s not Affiliates), the last-mentioned since 1Oct2020, having been disaggregated from PNO). It isn’t declared on what basis they’re prepared: accrual, cash, or a dangerous hybrid of accrued revenue & cash expenses (only recognising them when they’re paid: the ‘just-slip-the-invoice-in-the-drawer’ approach). A case in point: PAN, having the lowest volume of monetary events you’d expect the least problems, right? Wrong. The statement per the Aug2021 monthlies shows that only five of the 11 months had a Central Services charge, with no regularity to the five, & only two being the same sum. Oh dear. Dangerous? How prevalent is this nonsense? . . . if only Pacifica had an internal auditor.
• P#2 … Another reason to be careful using the monthly net income statements is that they don’t always square. Oh. They seem to be entered manually: they’re not reports generated automatically. Double oh. An example, so simple, one wonders how it wasn’t spotted, again from the Affiliate Network. (Guess Ursula isn’t pulling her weight, checking her net income statement before the LSB’s get the monthlies.) Re the statement in the July2021 monthlies, the analysed bottom half doesn’t agree with the totals at the top. Why? The July ‘Expenses Before C/Services’ wasn’t entered, & it was the sum of the row that ended up in the totals column. So an actual year-to-date loss was turned into a net income. Brilliant! The magic of NETA! (It was corrected in the August monthlies.) Question is, how prevalent is such sloppiness? (A more egregious example comes up in a sec.)
• P#3 … But le magnifique spectacle is in the Aug2021 monthlies, what NETA did to the first Paycheck Protection Program loan (PPP #1): pulled out of the consolidated FY2021, but not the units. The $1 256 630 loan had been approved 19June2020 by the Small Business Administration. With the lender having forgiven it on 12Jan2021, the incoming FY2020 auditor agreed to recognise this as an after year-end event, treating it as FY2020 income, a grant (auditor’s report, p. 19, being p. 21 of the PDF – https://pacifica.org/finance/audit_2020.pdf).
So in the August monthlies, NETA correctly pulled it out of ‘Miscellaneous/Other Income’ in the Jan2021 column of the FY2021 consolidated net income statement (to post it in the FY2020 column as ‘Grant Income’), but incorrectly left it in the units’ FY2021 statements. In the public record, why has this been met with deafening silence – has no-one noticed? What NETA’s done is distorting: the unit total revenues & net incomes/losses are overstated – materially so. It’ll catch out the inattentive – especially as there’s no warning note. Taking KPFK as an example, one sees ~$3.060m total revenue & ~$143k net income, whereas the adjusted figures are ~$2.660m total revenue & ~$257k loss. Oh.
Inexplicably, having done this restatement, NETA then stopped: they didn’t change all of the FY2021 totals! So, re the consolidated net income statement: the Jan2021 total revenue wasn’t reduced by $1 256 630, it was left as it had appeared in the previous monthlies. So, as expected, adding the monthly totals, the row, exceeds the correct FY2021 end column total. And as in all good tales, there’s a twist: NETA used a false figure as the Aug2021 total – but not a completely random gibberish number but a repeat of the July2021 total, $673 751.91 . . . which looks even odder coz the number immediately above it, which includes the PPP #2, has an extra digit: $1 222 741.63 . . . there you go, says Lydia.
• P#4 … There’s also a prob with the FY2019 comparative used in the NETA monthlies to date. The FY2019 auditor in their report issued a disclaimer of opinion upon the NETA-produced financial statements, so deciding they couldn’t vouch for their material accuracy. (Those statements appear again, reproduced, in the FY2020 auditor’s report as the comparative – in the consolidated at the front, & in the units at the back.) Thing is, the statements differ from those carried in the NETA monthlies – without saying so, & why. They haven’t been restated in the monthlies. That’s not a trivial matter.
That’s apparent in these four examples, with the Aug2021 monthlies carrying overstated, & at least one understated, FY2019 primary totals. For Pacifica: total revenue is overstated by 5.4%, $658 013 … (12814681 − 12156668); & total expenses, after omitting the unaudited depreciation charge, are understated by 14.5%, $1 696 122 … (9983328 − (11867848 − 188398)). For KPFK: total revenue is overstated by 8.7%, $296 456 … (3717740 − 3421284); & total expenses, after omitting Central Services & the unaudited depreciation charge, are overstated by 10.0%, $298 645 … (3293787 − (3575200 − 500868 − 79190)). (CS omitted coz it’s the same in both docs.)
Explanation of the anomalous understatement, of Pacifica expenses: NETA haven’t followed the FY2019 auditor’s treatment of Democracy Now! forgiving Pacifica’s $2 361 828 debt (p. 4; p. 6 of the PDF). The auditor has it ‘below the line’, the net income line, as an extraordinary item, a contra against what was hitherto a liability; whereas NETA, in the monthlies, contradicts this by having it within the net income statement, as a contra (of debt incurred eons ago) against FY2019’s total programming charge, making it a huge negative number, of more than $1.5m – albeit understated by exactly $36k, for an undisclosed reason.
In the public record, no-one, on a LSB finance cttee, the PNB Finance Cttee, or the PNB, has pointed any of this out.
• P#5 … As a complement, in the Aug2021 monthlies, the FY2020 comparative hasn’t been restated in the light of the findings by that year’s auditor. Consider these four examples, with the Aug2021 monthlies carrying overstated FY2020 primary totals. For Pacifica: total revenue is overstated by 7.6%, $879 936 … (12386996 − 11507060); & total expenses, after omitting the audited depreciation charge, are overstated by 3.6%, $403 720 … (11491271 − (11241966 − 154415)). For KPFK: total revenue, after adding PPP #1 as a grant, is overstated by 20.9%, $551 236 … ((2793326 + 393653) − 2635743); & total expenses, after omitting the audited depreciation charge, are overstated by 4.9%, $159 774 … (3435348 − ( 3291035 − 15461)). https://pacifica.org/finance/audit_2020.pdf
The main explanation for the anomalous KPFK revenue overstatement is that the unit-level net income statement in the FY2020 auditor’s report has all of PPP #1 posted to PNO; for an undisclosed reason, the parcelling out to the units has been deemed secondary, & so with PNO being the middleman that’s the unit treated as the recipient of the grant. As such, the most public of Pacifica’s financial documents carries a material distortion of revenue effectively received by the units.
The distribution of PPP #1 (& #2, for that matter) hasn’t been made public. But in the NETA monthlies are the Jan2021 & Aug2021 totals for ‘Miscellaneous/Other Income’, within which they’re posted. The Jan2021 totals per the July monthlies, the latest to have PPP #1 posted within FY2021: KPFA $440 828.47, KPFK $393 653.02, KPFT $58 199, WPFW $141 119.64, WBAI $126 557.47, PNO $50 180.54, PRA $46 755.67, consolidated as $1 257 293.81. That’s $663.81 more than the loan – and, indeed, that’s the figure left in the Jan2021 statement of the Aug2021 monthlies, when PPP #1 was deleted from the FY2021 consolidated & put in the FY2020 one. With no other info, in the KPFK computation above, the perhaps overstated $393 653 has been used.
• P#6 … Finally, to return to a Pacifica darling, PAN, Ruedenberg’s baby. In the Aug2021 monthlies, comparing the consolidated & PAN statements, the former’s ‘Income from Affiliates’ is understated by $20k: May2021, $2 192 per consolidated statement, $20 192 per PAN statement; & July2021, $10 852 per consolidated, $12 852 per PAN (when applicable, per May/June/July/Aug2021 monthlies). Guess Ursula not pulling her weight again – as well as everyone else reviewing the draft before duly authorised distribution to their high excellencies.
Given the silence, a warranted digression: ever wondered how much PAN pulls? An average of $2.50 per affiliate per day. That’s the price ED Brazon thinks the affiliates can bear – for broadcasting & streaming Pacifica programmes, even done at the same time as a Pacifica station (the FY2019 contract, unpaginated, being p. 1 of the PDF: https://pacificanetwork.org/wp-content/uploads/2018/11/Agreement-FY19.pdf). Calculation re the 233 affiliates: per the PAN net income statement in the Aug2021 monthlies, annualised revenue is $ (194646 ÷ 11) x 12 = $212 341 … ÷ 233 = $911 (sic) per affiliate per year … ÷ 365 = $2.496 = $2.50 per affiliate per day. A bottle of water? PAN = BWP. [UPDATE . . . the Sep2021 monthlies became available 30Nov, & per the PAN net income statement, the figure went up to $2.76 … 234473 ÷ 233 = $1006 per affiliate per year … ÷ 365 = $2.757 = $2.76 per affiliate per day. https://mega.nz/folder/RR8XmaAB#kEhHjAFTec2X_Z6CzAC5dw/file/xFk2QQ7T ]
At the mo, of the 233, only three outside the US (Liberia, France, Switzerland). So, John Lennon, & as an accident of the denary number system, 1000 x $5 x 365 = $1.825m pa … so x8.6 … or 2000 x $2.5 x 365 = $1.825m pa … going global, not just the anglophone world, but where English is a working language, a proper Pacifica marketing campaign could convince 750 stations somewhere in the world, yes? As PacificaWatch has been arguing, do that signal-swap, release that cash, implement a Pacifica network development plan.
• These are just a sample of the problems with the NETA-produced monthlies, & they’ll have to be discussed properly in another post. The lesson, analogously, caveat emptor.
KPFK revenue structure
• For context, what’s the scale of KPFK revenue, & how does it compare with the other stations? Given KPFK’s revenue collapse in FY2021 we should focus on that year, putting the previous one aside. We also need to clear away confusing leaves, omitting windfalls, such as PPP forgiven debt, & bequests. KPFK’s annualised adjusted total revenue for FY2021 is ~$2.4m, per the unaudited Aug2021 NETA monthlies. As per the estimated FY2021 net income statements presented in ‘Discussion: General’, the Pacifica revenue order is: KPFA $3.4m, KPFK $2.4m, KPFT $0.55m, WPFW $1.5m, WBAI $1.2m. So, KPFK < WPFW + WBAI. (Note, this $2.4m figure, for the whole of FY2021, is materially different from the $1.7m estimated in this post for the currentrate of annual revenue generation. This shows the need for being attentive to what one is addressing, how it’s conceptualised, & the questions crafted.)
• At KPFK, what proportion of revenue comes from LSD, listener support & donations? Inspecting the unaudited Aug2021 monthlies, with little confidence that postings to some of the different revenue categories are materially accurate (has Pacifica ever had an internal auditor?), other than LSD the station relies more on scrap metal than being in the wonderful world of public charities fed by grantors. Using ‘Listener Support’ alone as the proxy for LSD, as discussed in ‘Assumptions: revenue’, & assuming $48k for September (as per the lowest, April), that’s ~$1 591 147 for the year. And assuming $88k total for September (48k + 30k website income + 10k car donations), & removing the two PPP amounts, adjusted total revenue is ~$2 414 408. So LSD is ~65.9%.
For all the stations, audited FY2020: KPFA 63.1%, KPFK 74.0%, KPFT 86.8%, WPFW 94.3%, WBAI 98.7%. (In station order, LSD: $2 190 787, 1 951 112, 601 308, 1 315 134, 1 230 132; total revenue: $3 469 457, 2 635 743, 692 815, 1 393 924, 1 245 732.)
So KPFK’s unaudited year-on-year fall in LSD is ~$359 965, ~18.4% … (1951112 − 1591147) ÷ 1951112 = 359965 ÷ 1951112.
Relying on one revenue stream is intrinsically risky. But this is how Pacifica started off, how the organisation was designed. Later, to sustain a workforce of 150 & more, it became reliant on grants, not least from the Feds. With the last CPB grant being received c. Oct2012 (with the Mar2013 payment withheld, then cancelled), it’s been back to the LSD. Supplemented, of course, by the ray of sunshine emanating from the membership’s age structure, the upside of the downside, the grateful dead, the bequests – the Necro-economics of the Golden Corpses. The drying up of both has caused the current flood of pain. And across the Styx, as far as ever, lies the promise of the Bio-economics of the Network Development Plan.
The politics of revenue streams
In PacificaWorld, where money comes from in a contested topic, it’s a politics. Given this, & given the cash crisis, it would be helpful if those who decry advertising, the reality of the euphemistic underwriting (Saint Greta Grace & the multitude), & those who decry grants (Jonathan Markowitz et al.), present feasible 3, 6, 12, & 18 mth plans – with implementation of all having already started yesterday – of how to power a radio station by what is a revenue stream turning into a trickle. That would put meat on the bare bone of a sincerely held value, give it some substance & relevance in what is a political struggle conditioned by forces regulated by the material imperatives of an obdurate generative reality that becomes recalcitrant when challenged – not least in the case of the social law of money, exercised in capitalist society partly thru the institution of the court allowing a creditor to claim their cash. Pacifica listeners, members, & staff deserve more than rhetoric.
How should PPP #1 as income be accounted for: for all the units or just PNO?
Most peeps don’t think about accounting & auditing, & if they do they assume it’s pretty black & white (or black & red). Numbers. But they aren’t always as ‘hard’ as they seem – especially when different words can be harnessed to them. Conveying the most salient meaning is an achievement. There are accounting & auditing standards, quite detailed, but they necessarily embody some incompleteness & also ambiguity. All this means judgement is always involved, in conditions where material interests are at stake (such as wanting to be hired for the next audit), & so at work when they’re recognised. Enron isn’t unique. Choice, albeit bounded, is existential.
It popped up in FY2018, in how to account for the disposal of the ‘Nakapon’ land & building, Berkeley: should it be treated as a KPFA asset or a Pacifica asset? The PNB decided Pacifica, & the PNO accounting unit was used. https://pacifica.org/finance/audit_2018.pdf (p. 31; p. 34 of the PDF)
A choice also arose in FY2020, with the forgiven PPP #1 loan, an after year-end event, transforming the sum from a liability into grant income. And it draws attention to the difference between financial accounting & management accounting. Concerning the former, the event appears, correctly, in the Pacifica net income statement, within ‘Grants and contributions’ (p. 5; p. 7 of the PDF). But there’s a choice in how to treat it in the net income statement of the ‘Supplementary Information’, the unit level disaggregation (p. 34; p. 37 of the PDF). Should it be PNO’s income, or split up according to how much went to each of the seven units? https://pacifica.org/finance/audit_2020.pdf
Well, it depends on the primary meaning one wants to convey, this an expression of the primary semantic purpose, be it chosen or a default of orthodox training. If it’s shown as PNO income – as it was – then the windfall goes no further, it doesn’t pump up station (& PRA) income, so it shows them without that one-off distortion. But the reader of the statement needs to be aware that this has happened, that lacking the subsequent distribution it shows both an understatement of effective station (& PRA) total revenue, & an overstatement for PNO. That there was a choice, was never publicly discussed – probably coz no director or other delegate understood what was in front of their eyes.
EIDL, praps $2m – not an income (it’s a 30-yr loan), but seen by some as a saviour
• “As part of its underwriting, SBA will perform a cash flow analysis to confirm the business’ ability to repay the proposed COVID EIDL loan as well as its existing debt obligations. Once Applicant completed the inputs for revenues, COGS [cost of goods sold], expenses as appropriate, the system will automatically calculate the maximum eligible loan amount.” (unpaginated, p. 5 of the PDF, emphases added). Oh. Current liabilities are those falling due within 12mths, & since 31Oct2021 the $3.165m owed to FJC, is a . . . current liability. Double oh. (And, yet again, the capitalist state gets sight of info denied to the plebs, milked for their flow of cash to Pacifica Foundation, Inc.) https://www.sba.gov/sites/default/files/2021-09/Supplemental-Checklist-COVID-EIDL-intake%20form-090821-508.pdf
• But it doesn’t stop there: “[t]he information contained in this schedule is a supplement to your balance sheet and should balance to the liabilities presented on that form”. Oh. So NETA has to get all the station data, & PNO & PRA & PAN; do all the reconciliations for the eight units; then make eight unit trial balances; before producing a consolidated trial balance; & finally turning this into both a Pacifica balance sheet & a Pacifica net income statement. Big oh. (And NETA tell us that KPFA is holding up a prelim like the monthlies. And NETA tell all & sundry that at this time a balance sheet can’t possibly be produced for a station, let alone for Pacifica – that sort of work can only be done once all the preparations have been made for a visit by the doctor auditor.)
Concerning the lil matter of current items, Dr & Cr, the last balance sheet date at which Pacifica had audited liquidity, the luxury of working capital, an excess of current assets over current liabilities, was 30Sep2009. Yes, 2009. (Working capital is a difference: the phrase isn’t a synonym of cash.) https://pacifica.org/finance_reports.php
Hang on a sec. The application for the extra $1.5m could have gone in straight after 8Sep, if Pacifica was ready? Does this matter? After all, two months later, at the PNB Finance Cttee last Tuesday, 9Nov, ED Brazon was still flapping about: “we will be submitting on paper 2 million realizing that 350 – well, that 500,000, urgh, is, um – it-it would be reduced by, and, um, and see how much of that is, um, you know, we end up getting. So, we’re in the process of-of doing that […] we will be, argh, subsequently applying for, um, more of the loan […] and we wanna do this before the [calendar] year-end, so we are, argh, anxious to move ahead with that” (36:18, emphases added). https://kpftx.org/archives/pnb/finance/211109/finance211109a.mp3
Guess Lydia, 9Nov, saying “we will be, argh, subsequently applying for, um, more of the loan […] and we wanna do this before the year-end”, doesn’t cut it, does it?
KPFK expenses structure
• For context, what’s the scale of KPFK expenses, & how does it compare with the other stations?
KPFK’s annualised total expenses for FY2021 are ~$3.15m, as per the estimated FY2021 net income statements presented in ‘Discussion: General’, using the unaudited Aug2021 NETA monthlies (the monthlies exclude the depreciation charge: audited FY2020 totalled $154 415, with just over half at KPFA, & KPFK’s being $15 461 – auditor’s report, p. 36, being p. 39 of the PDF, https://pacifica.org/finance/audit_2020.pdf).
Total expenses = Central Services expense + other expenses. So . . .
The monthly CS charge (the set persisting contrary to the formula adopted 18Feb2021 by the PNB – on which more anon): KPFA $39 288, KPFK $41 739, KPFT $13 469, WPFW $17 348, WBAI $21 112. So, annual charge: KPFA $471 456, KPFK $500 868, KPFT $161 628, WPFW $208 176, WBAI $253 344.
And non-CS expenses for FY2021, in rough terms: KPFA $3.20m, KPFK $2.65m, KPFT $0.54m, WPFW $1.35m, WBAI $1.41m.
As context, all the stations, audited FY2020: KPFA 65.4%, KPFK 62.4%, KPFT 32.8% (sic), WPFW 44.7%, WBAI 36.4%. ‘Cut to the bone’ = no workers. (In station order, personnel costs: $2 282 066, 2 054 311, 248 216, 598 427, 674 704; total expenses: $3 489 553, 3 291 035, 755 945, 1 509 889, 1 645 202.)
This is even more obvious when seeing personnel costs as a proportion of non-Central Services expenses, ‘the station free of the shackles’, as is the wont of the KPFA breakers. So, witness audited FY2020: KPFA 75.6%, KPFK 73.6%, KPFT 41.8%, WPFW 46.0%, WBAI 48.5%. (CS: $471 456, 500 868, 161 628, 208 176, 253 344; non-CS expenses: $3 018 097, 2 790 167, 594 317, 1 301 713, 1 391 858.)
Other KPFK personnel details are in the appendix, ‘how many employees work at KPFK? the average personnel cost?’.
• What’s the proportion incurred by Central Services expense?
Audited FY2020: 15.2% ($500 868)
All the stations, audited FY2020: KPFA 13.5%, KPFK 15.2%, KPFT 21.4%, WPFW 13.8%, WBAI 15.4%. Source as above. With KPFA revenue rising, & the fixed sum CS expense starting 1Oct2014, to the rich the riches! Whilst KPFT gets the tumbleweed – and has no cash for relocation. (But at least they have the porch – at home, not at the station.) Why even have a flat rate tax when you can go turbo regressive with fixed sum? So-called neoliberalism in spades! To get rich is glorious!
An even more appalling index of this reactionary nonsense is the ratio of CS expense to programming expenses. The ‘happy news’ folk trumpet Charity Navigator ratings, & say potential grantors like something or other to do with programming spend. So, CS as a proportion of programming, FY2020: KPFA 22.6%, KPFK 29.5%, KPFT 78.5%, WPFW 41.7%, WBAI 40.6%. This shows how wrong is the fiscal structure of Pacifica, how reactionary it is.
In fact that self-claimed “world’s largest and most trusted nonprofit evaluator” (“About Us”) hasn’t updated their computation of Pacifica’s programming expense as a proportion of total expenses: the given 44.4% is the average of the 2016-2018 Form 990’s, whereas that of the 2017-2019 ones is 45.6% (the last uses the FY2020 audited data) – https://www.charitynavigator.org/ein/941347046.
Reinforcing this message is comparing programming spend with CS, the absolute amount. Programming: the mantra for Pacifica’s renaissance. And yet . . . and yet . . . For FY2020, KPFT’s excess of programming over CS was a mere $44 233 (205861 − 161628); for KPFA it was $1 617 391 (2088847 − 471456). A remarkable x36.6 – the remuneration structure of a Chinese factory. Blaming the poor. Blaming the victims of a lack of a Pacifica network development plan. Leaving Pacifica as an archipelago, stations all strung out – an aggregation, not a network. But congratulating WPFW for being one of Lydia’s green shoots. That’s as coherent as the laissez-faire Pacifica gets.
• What’s the proportion incurred by non-Central Services expenses? The inverse.
So, for audited FY2020, 84.8%.
All the stations, audited FY2020: KPFA 86.5%, KPFK 84.8%, KPFT 78.6%, WPFW 86.2%, WBAI 84.6%. Source, as above.
The new Central Services policy, 18Feb2021 – never implemented, but how much would it have saved KPFK thru 30Sep2021?
• the PNB unanimously adopted a new CS policy 18Feb2021 – but it’s never been implemented. If it had been, KPFK would have saved an unaudited ~$78 802 19Feb-30Sep2021. Why has no-one at KPFK pointed this out – and acted upon it?
KPFK’s Central Services charge changed with effect from 19Feb because of the new PNB formula unanimously adopted the evening before. The new policy, in full:
[t]hat the central services formula be based on 15% of total revenue of the stations calculated quarterly. All revenue is to be included in the calculations; however the cost of air conditioning for Pacifica Radio Archives shall be deducted from KPFK’s revenue, and the tower, studio and office rent for all stations shall be deducted from their revenue.
However, CFO Anita Sims & ED Lydia Brazon have chosen not to implement it. No director or other LSB delegate has informed the public of this fact – or explained their quiescence to this insubordination. More tail wagging the dog. Not even a reprimand, let alone a punishment. The directors, allowing their instruments to abdicate their responsibilities & duties. Another example of not even taking their own decisions seriously – just like with their 11June2020 policy on loss-making stations. To be honest, they’re LARP’ers. But all is not lost: they could make a show of sincerity, of authenticity – donning clown costumes.
old CS policy: annual charge = $500 868, so period = ~⅝ x 500868 = ~$313 043 (Incidently, this annual charge is ~29.9% of the estimated annualised current revenue of $1 674 811, quite different from 15%. Paying twice as much.)
new CS policy: period = ~½ Jan-Mar charge + Apr-June charge + July-Sep charge
= ~60084 + ~98490 + 75667 = ~$234 241
savings = ~313043 − ~234241 = ~$78 802 = ~$80k
So, a ~$80k saving that no-one at KPFK is talking about, with no public evidence that they even know it exists.
• Workings re new policy:
Jan-Mar2021 charge determined by total revenue Oct-Dec2020:
Oct-Dec2020 net total revenue = (399393 + 103528 + 315949) − ((3 x 4000, PRA electricity) + (3 x 1919, tower rent)) = 818870 − 17757 = $801 113
0.15 x 801113 = $120 167, & ÷ 3 = $40 056 per month
Apr-June2021 charge determined by total revenue Jan-Mar2021:
Jan-Mar2021 net total revenue = ((541145 − ~393653) + 305355 + 221567) − ((3 x 4000) + (3 x 1937)) = ~674414 − 17811 = ~$656 603
0.15 x ~656603 = ~$98 490, & ÷ 3 = ~$32 830 per month
charge = ~$98 490
Note: per the Aug2021 NETA monthlies, the PPP #1 still sits in the Jan2021 column ($393 653) of the KPFK net income statement, so this had to be deducted. (As already mentioned, thru the June2021 monthlies the Jan2021 total was different, $322 201; then in the July 2021 set it went up $71 452. No-one on the PNB Finance Cttee publicly asked why this happened.)
July-Sep2021 charge determined by total revenue Apr-June2021:
Apr-June2021 net total revenue = (107683 + 261975 + 152598) − ((3 x 4000) + (3 x 1937)) = 522256 − 17811 = $504 445
0.15 x 504445 = $75 667, & ÷ 3 = $25 222 per month
charge = $75 667
A note on the Central Services charge
The monthly Central Services charge: KPFA $39 288, KPFK $41 739, KPFT $13 469, WPFW $17 348, WBAI $21 112. (Serving as these incomes: PNO $115 576, PRA $17 380 – total $132 956.) Expressed as an annual charge: KPFA $471 456, KPFK $500 868, KPFT $161 628, WPFW $208 176, WBAI $253 344. (Incomes: PNO $1 386 912, PRA $208 560 – total $1 595 472.)
In FY2014 the annual total levy was higher, by $75 955, & for all stations except for WBAI (the current annual charge is in brackets): total, $1 671 427 ($1 595 472); KPFA, $487 312 ($471 456); KPFK, $524 874 ($500 868); KPFT, $193 286 ($161 628); WPFW, $245 995 ($208 176); WBAI, $219 960 ($253 344). What does this mean? Four stations shared the benefit of the $75 955 for each of the last 7yrs – plus sharing the benefit of the extra $33 384 levied each year upon WBAI. The total 7yr benefit for KPFA, KPFK, KPFT, & WPFW is $765 373, $191 343 per station, $27 335 per station per year.
WBAI’s charge rising in FY2015, at the very moment its financial crisis was extending & intensifying, is just more evidence in support of the idea, consistently propagated by PacificaWatch, that the distorting charges/benefits resulting from the initial endowment of a station be stripped from its management accounts & dumped in PNO – for example, WPFW & WBAI continue to suffer the double whammy of not just effectively subsidising KPFA, KPFK, & KPFT for enjoying Pacifica property rent-free, but having to pay their own rent for buildings & tower. That’s one reason why it’s superficial, & misleading, for Chris Cory, Sharon Adams, & Sabrina Jacobs, all of KPFA, to repeatedly castigate some stations for being less productive, inefficient, performing badly, barbs laced with digits plucked from the published station-level monetary data. Cary Grant.
The formula 1Oct2014-18Feb2021, at some point, seems to have been 15% of station listener support & donations – CFO Sims (3:31), 24Nov2020 PNB Finance Cttee, https://kpftx.org/archives/pnb/finance/201124/finance201124b.mp3. But who quantified the LSD sums subjected to the 15% appropriator, & when? That is, are they as per auditor’s report, produced whenever (for example, the FY2015 one is dated 7Aug2017)? – or is each an unaudited figure self-declared by the neutral station bookkeeper, hired by the station manager? And who decided never to change the 1Oct2014 charge level, even when NETA started producing monthly net income statements?
It’s also the case that the CS charge is somewhat nominal, in that at year-end a reconciliation isn’t made between the total charge & the actual expenses incurred, to result in either a rebate or a levy supplement for the stations. (Has it ever been done?)
The charge started being incurred by PAN on 1Oct2020, when it became an accounting unit independent of PNO. However, its size was never discussed by the PNB Finance Cttee, according to the public record, so presumably it was simply chosen, on whatever ground, by CFO Anita Sims, whenever. Also, at $26k thru Aug2021, it’s so low that it was decided, by whoever, not to reduce the station charges.
Note on the budget-formation process … The current PNB Finance Cttee practice is back-to-front: it first looks at station draft budgets before, if ever, getting to PNO. Hello! The need for a station/PAN levy exists coz PNO doesn’t have enough endogenous revenue to fund pan-Pacifica expenses. So just to be rational – that old-fashioned idea – one starts with PNO, with its estimate of coming year expenses, less estimated revenue, & that establishes the non-discretionary expense, as it were, that the units have to cover before allocating their discretionary spend. Quite simple, really. But then the directors, ED, & CFO would have to transform the obdurate generative reality, with all its recalcitrance: the Pacifica dynamic of weak centre & largely unchallenged fiefdoms. Given their enduring capitulation, that’s why the current budget-formation process is both substantively & formally irrational. (It would also require ED Brazon to take the lead – which she has consistently proved incapable of doing since taking office on 5Dec2019 – https://pacifica.org/documents/pnb_exec_191205.pdf.)
General, a return: to what extent does the KPFK revenue structure satisfy the expenses structure?
audited FY2020: 70.0% … 1951112 ÷ (3291035 − 500868) … a material deficiency. (Same net income statement in the auditor’s report cited.)
unaudited FY2021: ~60.0% … ~1591147 ÷ (~3151239 − 500868) … falling towards only half of those expenses.
• To what extent does LSD cover personnel costs?
As context, current personnel costs are what percentage of current expenses? It was argued – not asserted – in ‘Assumptions: Expenses’ that current expenses be calculated as the average of the June, July, & August 2021 totals, per the August monthlies. So, current personnel costs, annualised = 12 x 119411 = $1 432 932 … where 119411 = ⅓ (120690 + 113290 + 124253. And current total expenses, annualised = 12 x 244684 = $2 936 208 … where 244684 = ⅓ (242434 + 254872 + 236746). So, percentage = 48.8%.
Given that the Central Services charge has a certain arbitrariness about it (as discussed above), what context is provided by the relationship of personnel costs to total non-CS expenses? Current total non-CS expenses, annualised = 12 x 202945 = $2 435 340 … where 202945 = 244684 − 41739. So, percentage = 58.8%. Exactly 10 percentage points higher.
So, to the question posed: to what extent does LSD cover personnel costs?
Audited FY2020: 95.0% … 1951112 ÷ 2054311 … LSD wasn’t enough. And that leaves all the other expenses untouched, to be paid for by some other revenue stream: scrap metal, advertising, grants – and the miraculous windfalls (pp. 34 & 36; pp. 37 & 39 of the PDF).
Unaudited FY2021: ~92.7% … ~1591147 ÷ (1597151 thru Aug + ~120k Sep) … LSD is a lil bit more off.
. . . and the labours of Sisyphus continue in PacificaWorld:
the next fund-drive, which is gunna be, um, December 7 until the 22 [from a Tuesday to a Wednesday, 16 days]
•A• Appendix: how many employees work at KPFK? the average personnel cost?
How many employees work at KPFK? More particularly, how many full-time equivalents (FTE)?
Never easy to find out. A common ploy of the Pacifica secrecy culture is to hide behind the closed meetings rule grounded in the 1934 Communications Act, & so appearing in the CPB’s rules. And, yes, it does indeed refer to personnel matters. So in the meetings archive we readily get talk such as this: “[m]eeting to discuss confidential personnel issues at KPFK, proprietary business issues at KPFT and other legal and personnel issues” (Th21Oct2021 PNB, emphases added) – https://kpftx.org/archive.php. Peeps switch into panic mode: there’ll be litigation! – although no-one ever cites a case sparked by what’s in an audiofile. (In PacificaWorld, fear does a lot of work – without too much effort.) But few ever read the relevant Comms Act passage: a valid ground for a closed session is “to consider matters relating to individual employees” (§ 396(k)(4), emphasis added; p. 216) – so not ‘relating to employees’, & not ‘personnel’ which can be interpreted to include anyone working for Pacifica, so including contractors – Comms Act is embedded at https://pacificaradiowatch.home.blog/pacifica-sources/pacifica-documentary-sources/. (Obvious didactic prescription: Pacifica management should post in the meetings archive a legal opinion, one using a minimum of five borderline scenarios, as well as case law, to illustrate the boundaries of the “individual employees” concept. But this won’t happen, will it?)
But recent info is dispersed around:
• Obviously Pacifica isn’t organised enuf to have a basic like an annual report. (Intrinsically dangerous in simply being something written down; worse still in serving as a benchmark for evaluating peeps like the directors, ED, CFO, station managers, etc.) But whilst respect for the members is missing, it’s there for the arm of the state, such as the IRS, who demand such reports. So the 2019 Form 990 says, “[t]otal number of individuals employed in calendar year 2019 [is] 167” (unpaginated; p. 1 of the PDF) – https://pacifica.org/finance/2020-990.pdf. Useful in a way, but doesn’t give the FTE total – & includes those only employed for a day (it doesn’t say ‘the average number …’).
• At the 20Oct2019 KPFK LSB, just after the raid on WBAI, Grace ‘I have always exercised my fiduciary duty to the utmost’ Aaron (1:25:24) gave pan-Pacifica info, down to 2 decimal places (sic). She had examined “payroll from the second-half of June 2019”, extracting these data (‘ees, FTE): KPFA 47, 31; KPFK 35, 26.21; KPFT 4, 3.38; WPFW, 11, 7.87; WBAI 11, 7.57. Total: 108 ‘ees, 76.03 FTE. (She mis-spoke at the end, meaning ‘KPFA has x4 the FTE of WBAI’.) (Big gap here between the 108 & the 167 just cited – even when adding in PNO, & the 4 at PRA. Irreconcilable, yes?) https://kpftx.org/archives/pnb/kpfk/191020/kpfk191020a.mp3
And the average personnel cost? The FY2019 personnel costs are found in three sources, that give slightly different figures: an expenses statement in the FY2019 auditor’s report dated 29Apr2021 (p. 35; p. 38 of the PDF), which in giving a disclaimer of opinion means all the figures provided by NETA are unaudited (pp. 1 & 2; pp. 3 & 4 of the PDF); & the Nov2020 & May2021 sets of unaudited NETA monthlies (Nov2020 is the earliest set in the public domain; May2021 is the last one to give FY2019 as a comparative).
Unaudited, per the FY2019 auditor’s report (p. 35; p. 38 of the PDF; there was a disclaimer of opinion upon the NETA-produced statements): KPFA $2 215 341, KPFK $2 015 667, KPFT $250 167, WPFW $681 384, WBAI $728 030 (the other accounting units are PNO $524 506, & PRA $279 310; the seven totalling $6 694 405).
Applying the Aaron FTE figures: KPFA $71 463, KPFK $76 905, KPFT $74 014, WPFW $86 580, WBAI $96 173 (can the last two be true?); the five stations, $5 890 589 ÷ 76.03= $77 477. Given the limitations of the evidence used, if a prudent single figure is to be offered, $75k wouldn’t be unreasonable.
Interestingly, the first three, those with their own bookkeeper, are different from the NETA monthlies, which themselves can vary (first the Nov2020 set, then May2021): KPFA $2 235 652 & $2 212 213, KPFK $1 976 259 & $2 017 857, KPFT $251 581 & $250 167, WPFW $681 384 for both, WBAI $728 030 for both. (The differences: KPFA, May2021 gives $23 439 less than Nov2020, & the FY2019 auditor’s report gives $3 128 more than May2021; KPFK, +$41 598, −$2 190; KPFT, −$1 414, 0; WPFW, 0, 0; WBAI, 0, 0; so May2021 is $16 745 more than Nov2020, & the NETA statement in the NY2019 auditor’s report is $938 more than May2021.)
• At the Su15Dec2019 KPFK LSB, then station manager Anyel ‘who cares if KPFK keeps losing money, I’m just the GM’ Fields (1:17:47) gave some personnel info: “the median [annual] income for a full-time employee at KPFK is $50 639; part-time employee is $32 635″ (emphasis added). Notice the choice of concept: “income” – not personnel costs. So what may be the median annual personnel costs? The latest monthlies giving monthly statements for FY2020 are those for May2021. KPFK’s net income statement for Dec2019 gives ‘Salaries’, presumably Fields’ “income”, as ~73.9% of the total personnel costs of $177 166. The composition: ‘Salaries’ $130 983, ‘Health Benefits’ $31 218, ‘Pension Contributions’ $2 648, ‘403B [Pension] Contributions’ $1 374, ‘Child Care’ $890, ‘Payroll Taxes – FICA’ $10 018, ‘Payroll Taxes – SUI’ $36. Applying this 73.9% proportion, Fields’ median annual personnel cost may be $68 494 (50639 ÷ 0.739). https://kpftx.org/archives/pnb/kpfk/191215/kpfk191215a.mp3
(The median is a kind of average: it’s the one in the middle, with as many terms bigger than it as there are smaller than it. The best-known average is the (arithmetic) mean, the sum of the terms divided by the number of terms; another is the mode, the most frequent value. Presumably GM Fields chose as his measure the unusual median coz it came out lower than the mean – just like choosing “income” rather than personnel cost. Have to stay alert in PacificaWorld, peeps.)
GM Fields added: “KPFK has 23, urgh, full-time employees and 10 part-time, and a handful of temp employees that we bring in during fund-drives or in other extraordinary circumstances” (1:18:55). The only way to square this with Saint Grace’s report about the late June2019 data, 6mths before, “35 total staff, 26.21 full-time equivalents”, is that the 10 or so part-time workers amount to 3.2 FTE, so averaging ~1½days per week. Plausible?
• The penultimate info, quite revealing, comes from Mark Torres, Director of the Pacifica Radio Archives. He presented their FY2021 budget to the 13Apr2021 PNB Finance Cttee (33:35). He said there are four “staff”: MT himself; Shawn Dellis (“administrative officer”), Mariana Berkovich (“business manager”), Edgar Toledo (“production director”; also “an expert in tape transfer”). All very comfortable. So PRA get to have a business manager but KPFK doesn’t? Raising the question: where’s ED Brazon’s assessment doc that rejected NETA taking over this very low volume transaction operation?
Per the Aug2021 NETA monthlies, there’s only one month a year – the PRA fund-drive (one day?) – when revenue, other than from Central Services (& windfalls like PPP #1 & #2), exceeds $15k, with two $10k-15k, the rest less than $6k. Meaning, the usual working day brings in ~$279. I kid you not. Poor Mariana. Frazzled. All that managing. Relieved whenever the clock strikes five. But every vacation ruined, dreading the return to the backlog.
PRA’s average takings of $279: the 11mth revenue (excluding the Central Services stream) = $225 710 … less (Nov2020 fund-drive + PPP #1 & #2) = $67 437 … ÷ 11 = $6 131 pm … ÷ 22 = $279 per working day. Poor Mariana, worked off her lil feet.
And Pacifica Affiliates Network isn’t that much better: its revenue rate is only x3 of that $279: PAN generates an average of ~$2.50 per calendar day from each of the current 233 affiliates, ~$212k a year. So, apart from CS & PPP, total revenue of PRA + PAN ≃ $ (64k drive + 74k other) + 212k = ~$350k. https://pacificanetwork.org/stations-2/
Guess Mark forgot to mention how intense things are at PRA when he chatted with the PNB Finance Cttee in April. And the directors & other LSB delegates didn’t know to ask.
But I digress. The point is that these four specialised, quite experienced workers bear annualised personnel costs of ~$263 438. An average of ~$65 860. (Per Aug2021 monthlies: $237218 + the omitted Aug health benefits, 4267 (without a NETA note it’s prudent not to rely on an adjustment occurring) = $241 485, then annualised, & divided by 4.) This is $10k or so less than that using the June2019 Aaron figures. Yet one would think these PRA workers would earn above average pay, yes? Odd.
• Finally, what did station manager Miquel say at the PNB meeting yesterday? “[W]e are about 15 staff members […] we are 15” (17:38 & 18:21 into the KPFK item). Really? And he means the 15 are all full-time? No part-time?
August’s personnel costs, which in being higher than any month since March may include severance costs, were $124 253, an annualised $1 491 036 … ÷ 15 = $99 402 per ‘ee for the year. Plausible? So take the lowest monthly of FY2021, July, $113 290. Annualised as $1 359 480 … ÷ 15 = $90 632. Again, plausible? Ok, let’s say all these months have severance, & assume current monthly costs of the 15 as $100k (making monthly severance costs since March, $13k-24k), so an annualised $1.2m … ÷ 15 = $80k. Well, maybe still on the high side – and is monthly severance of the order of $20k? And we need to keep in mind the other estimates: Aaron’s June2019 ~$75k, & PRA’s FY2021 ~$66k – and Fields’ median of perhaps $68½k.
Disclaimer of opinion means that the auditors haven’t vouched for the material accuracy, the ‘fairness’, of any of the figures in the statements in their report: neither the financial statements for Pacifica as a whole (the consolidated) nor the management statements for the accounting units (the stations, etc.).
All parts of the statements lack the credibility that the appropriate third-party professional could have given them, but having taken the cash, they found they were unable to say, one way or the other.
For a potential grantor, that’s a warning about the past year; the going concern warning is about the current year & possibly beyond.
Wishful thinking to the contrary is precisely that.
Audiofile of the W30June PNB Coordinating Cttee
Eventually published W7July. PNB Chair Alex Steinberg on the auditor’s report: “they [sic] were submitted to the AG today” (30June, 3:43). Inadvertently, the audiofile included the Cttee’s closed discussion for the Th8July PNB closed session (16:40). Oh. (On the copy, linked below, 3:45 & 16:42 respectively.)
Why hasn’t the FY2020 auditor’s report been published by Pacifica, as mandated by California law?
As related Tu6July on this blog, Pacifica announced in writing that day that “the FY2020 audit” (sic), at 30June, had been “completed but was not filed”. So why has Executive Director Lydia Brazon chosen not to publish it to the public, as required by California law?
And contrary to the claim made in Pacifica’s 6July statement, the law doesn’t admit the possibility of extending its filing date with the California Attorney General:
[Q:] Does the extension for filing IRS Form 990 also apply to the completion date for the audit? [A:] No. The statute does not provide for an extension of time.
Is there no transparency of proceedings? Is there no accountability for behaviour?
Is Pacifica a rule-bound operation? Does any of this matter?
What is Pacifica: private club or public charity?
[Addendum: deriving meaning from the revealing referenda info provided by National Elections Supervisor Peñaloza to the Th8July PNB.]
The breakers decisively win the listener-member referendum (6 000 — 5 800?, maybe 6 050 — 5 750?) – but lose the war … with maybe 220 blocking 6 000
An important indicator of the likely referenda results was disclosed by a frazzled Renée Asteria Peñaloza, the National Elections Supervisor, at the Th8July PNB. She said the electorate was ~44 000 listener-members & 1 035 staff-members (40:32 after roll-call). Prior to this, the latest figures disclosed by Pacifica were 42 491 & 993, respectively, at 2Jan2020, the record date for the first by-laws referenda. (The anti-breakers won both referenda: 6 340 — 3 273, & 331 — 177.)
• total electorate up, +~3.4%; mostly a net extra ~1 500 listener-members. Have the anti-breakers been on a recruitment campaign? We know who’s been organised, been organising, & been mobilising peeps for a few years now
• this is surprising, to say the least: according to official figures (buyer beware), Aug/Sep2015 ⭢ 2Jan2020, total listener membership in this 4⅓yr period fell at the rate of ~2 340 a year. So, going against the grain current, we may have here 1500 + 2340 = 3840. Where did these people come from? Who’s been recruiting/retaining over 3k peeps, all in little more than a year? This contrasts with the lack of a ‘bump’ before the first referenda. This time is different. (The ~2 340: (52582 − 42491) ÷ 4⅓) – https://pacificaradiowatch.home.blog/non-financial-pacifica-data/the-knell-pacifica-membership-passing-over-time/
• listener-member referendum: at the Tu6July KPFT Development Cttee, Robin Lewis (Membership Lead) disclosed that membership “is at 2 900” (57:54) – https://kpftx.org/archives/pnb/kpftdev/210706/kpftdev210706a.mp3. At 2Jan2020, it was ~4 537 (~4 368 listeners, ~169 staff), so a drop, in unemployment CoronaTimes, of –36.1%. If this membership has dropped (moreover, at the only station where the breakers won a 2020 listener referendum, ~453 — ~423), whilst membership has grown for Pacifica as a whole, there’s only one rational conclusion: it’s the breakers who’ve been recruiting massively, & on the West Coast – whilst the anti-breakers sat on their laurels, singing Freddy Mercury
• staff-member referendum: membership +4.2%, but with much smaller numbers involved it’s more uncertain who the recruiters are
• turnout: compared with the Mar2020 by-laws referenda voting, listener-member turnout, as a share of an increased electorate, is +~17.9% (22.9% ⭢ ~27%), & staff-member turnout, as a share of a decreased electorate, is –~18.6% (51.6% ⭢ ~42%). The killer stat is the +~17.9%. Seriously. And one needs to say again: have the anti-breakers been on a recruitment & mobilising campaign? We know who’s been organised, been organising, & been mobilising peeps for a few years now
• listener-member turnout: in 2020, 42491 x ~22.9% = 9714; in 2021, 44000 x ~27% = ~11880. Increase of ~2 166, by +~22.3%. (Assuming the ~1 500 net increase to the electorate all voted, that means at least ~650 ex-abstainers voted – peeps more likely to be roused by the call for a new day, a new beginning, than holding fast to the status quo.) Is anyone seriously suggesting that the anti-breakers, who had no unified national campaign, & got into the action so, so late, magically got even 1 000 new peeps to turn out to vote for them?
• staff-member turnout: in 2020, 993 x ~51.6% = 512; in 2021, 1035 x ~42% = ~435. Decrease of ~77, by –~15.0%
Only one rational conclusion is derivable from the evidence.
Conjecture: listener-member result = 6 000 — 5 800, maybe 6 050 — 5 750, a win by 200-300. (Excludes invalid ballots: 101 in the last referendum. The main assumption is the anti-breakers suffering attrition by a ⅐th (900) of their Mar2020 referendum support; also, the breakers mobilising 800-850 other new members or former abstainers, plus winning 1 900 out of the described 2 166 increase.)
As noted in previous posts, the breakers may win the listener-member referendum, & even win the staff-member referendum at three of the stations (as in 2020), but lose the staff referendum coz the highest turnout rate remains at WPFW & WBAI . . . so with ~435 Pacifica staff voting, 220 may block 6 000 . . . a voting potency of x27.
NES Peñaloza said she may have the results tomorrow afternoon (East Coast), otherwise on Monday (42:28 after roll-call). In a typical lack of precision, from a purported elections supervisor, she didn’t speak of either the certification of the results or the announcement of the results. But the stuffing has been knocked out of her.
(This P.S. will be incorporated into a post made tomorrow on the worrying habit of the NES, the ED, & other Pacifica decision-makers to continually speak, & in the NES’ case, write, of ‘the referendum’ rather than the referenda. By by-law Article17, Section 1(B)(3), both (v) & the final sentence, & (4), both classes of members have to approve any change having a differential material adverse effect on voting rights: “the Members shall vote in classes and the majority vote of the Members of each class shall be required to approve the amendment” (emphases added). This has been explained in previous posts. Also please note the confused question put by Lawrence Reyes to the NES, & her reply (58:54 after roll-call). https://pacifica.org/indexed_bylaws/art17sec1.html)
R Paul Martin, long-standing WBAI treasurer, & Secretary of the PNB Finance Cttee, gives a written report to each meeting of his Local Station Board. This one, five pages, was a lot easier for him: usually the national Cttee meets the evening before, calling for a page or three of details. Small mercies in These Times of the Reign of the Lunatic.
These Times of the Reign of the Lunatic. Made possible by the opportunistic Republican Party. Made worse by renegades from their scientific & public health training, bringing their professions into disrepute, bending to the opinions of The Lunatic, discarding their duty to the public, diluting CDC public health policy. Sacrificing the public, collateral in a self-serving effort to keep their jobs. Colluding with the advocate of shining the light, cleaning with disinfectant. Betraying fidelity to evidenced reason. Capitulators. Yes, these enablers are led by Sideshow Bob–Debby–&–(less so)–Tony. Sad, horrible, as The Lunatic says in public. Wimps, cucks, as The Lunatic says in private.
. . . Amerikan Karnage . . .
Meanwhile, back in PacificaWorld . . .
Remarks on the report:
FY2018 audit delay: will do a separate post on this fiasco
re eligibility for money from the Corporation for Public Broadcasting, CPB, the lack of “the FY19 audit” (p. 3, emphasis added) largely misses the point: even if Pacifica can earn timely audited financial statements, & not an auditor’s report declaring their absence, the CPB has criteria for evidencedlistenership ‘in the community’ that’ll trip up Pacifica
“we can’t forget that the principal on the big loan is scheduled to come due in less than nine months” (p. 4) – much, much worse than that, Paul: not only is there no plan addressing FJC’s $3.265m, there hasn’t even been the preliminaries of a public Pacifica discussion to simply identify the options!
corrections: NETA is not Television (p. 1), but Telecommunications; & FJC quarterly interest, due 30Sep, 31Dec, & 31Mar, is not ~$70k (p. 3), but, since 16Mar2020, $51 016 ($3.265m x 6.25% ÷ 4).
Lastly, this teleconferenced meeting isn’t being streamed. No explanation is given in the notice on kpftx.org. It’s an open meeting, in the terms of the Communications Act of 1934, § 396(k)(4). This sub-section implies that if Pacifica is indeed receiving any money under the Act, then for a teleconferenced meeting to be compliant, Pacifica has to publicly stream the proceedings, not simply make public a recording of the meeting. That is, the meeting must be witnessed, even if only aurally; & witnessing means whilst it’s happening.
And what counts as a meeting? ln the opinion of the CPB, “[n]ote that deliberations do not require any formal action or vote. Any discussion of public broadcasting issues that may influence the opinions of members makes it a meeting” (all emphases added). So much for the view expressed at the 11Mar2020 LSB meeting that, in the past, decisions had been ratified at a subsequent meeting.
Have any audiofiles been posted on kpftx.org? In 2020, prior to today’s meeting, there’s been six LSB open meetings, one each month, with the last four being teleconferences. But only the March has a publicly available recording – and although the box says “Archive Soon” it’s actually there, as a URL, https://drive.google.com/file/d/1RnIDQDCaO1mGn5z-Zph0eluonkbQvTdm/view?usp=drive_web – so no, it’s not the proposed agenda. Hidden gems do exist in PacificaWorld.
The public can obviously attend in-person open meetings, & posting a recording is a courtesy to members & listeners, & an exercise in transparency. The April/May/June teleconferences may indeed have been streamed, even allowing public comment, but Pacifica has offered no evidence that this was so. In fact, only the April & May notices show such an intention. Let’s hope that if the CPB comes auditing for compliance then the evidence exists. And if there are audiofiles, why aren’t they posted in the meetings archive, kpftx.org?
At Monday’s PNB Audit Cttee, 1June, Chair Eileen Rosin (WPFW listener-delegate) confidently said the draft auditor’s report was just about to be slipped into the envelopes, to be received by the ctteepeeps Wednesday or Thursday.
Obviously another glitch has occurred – maybe principal Jorge Diaz was the worse for having been gassed or ‘peppered’, benefiting from a chemical weapon that he helped pay for. (A different kind of perversion, the US state is legally bound not to use these against foreigners, but it has given itself carte blanche against Joe & Joanna Six-Pack. But the US was tardy: it took 50 years to ratify its 1925 commitment to the Geneva Protocol – after Vietnam, of course. https://en.wikipedia.org/wiki/Geneva_Protocol#Reservations has link to the relevant UN webpage)
As the double-screenshot shows, Audit will meet if not F12June then on Tu16June. The record shows that the changes were made by Chair Eileen, Friday tea-time, EDT.
Chair Eileen was the first officer or employee to publicly disclose (48:40) that the auditors aren’t issuing the management letter, the one telling the PNB, in confidence of course, how f’d up it is, & what it has to do to acquire a semblance of substantive rationality. Nothing new, in other words. Eileen didn’t explain (although she probably knows), but presumably it’s because ED Lydia Brazon (& the inner circle) haven’t agreed to some of its proposed content, not least being told in black & white that (a) bankruptcy protection may be unavoidable (although that triggers defaulting on the FJC contract), & (b) fundamental cost-cutting must be instigated within two months, if not weeks (although that greatly worsens immediate cashflow, given worker payouts). And the cost structure? The last audited figures (FY2016), so almost four years ago, gave personnel as 53% (plus, no doubt, some in the $257k consultants category), & 57% of those personnel costs was spent on the west coast stations, KPFA $2.0m, KPFK $1.7m. The other three stations totalled KPFK + $12k. Some stations, Lew, rely more on volunteers than others. https://pacifica.org/finance/audit_2016.pdf (pp. 5a & 26; pp. 8 & 30 of the PDF); &
a number of Pacifica favourites are crammed into the virtual room, in a self-sacrificing act of solidarity with Viro the Virus:
the return of Adriana
the elevation of our Bella
the serene breaker Lynden “what-a-bunch-of-fucking-bullshit” Foley
R Paul Martin’s latest diligent endeavour. Mr Martin is the only Pacifica treasurer to publish for members & listeners the report they make to their Local Station Board. Not only that, it’s posted online within hours of the meeting. His courtesy & service is unequalled amongst the $$$ p$$ps of Pacifica.
Also please note that by an accident of the Pacifica calendar, his LSB usually meets less than 24hrs after the PNB Finance Cttee, details of which are always part of his report.
Mr Martin’s dedication is exemplary, his judgment astute.
[Remarks to be added, esp. re the Tu10Mar PNB Finance Cttee that Paul discusses, one addressed by both Chief Financial Officer Anita Sims & auditor Jorge Diaz of Rogers & Co. With the breakers busy with their breaking, Paul was perhaps at his most pessimistic, wondering whether “this will be my final Treasurer’s Report” (p. 4), a small matter compared with his fearing for the future of WBAI. Unless the breakers pull some stunt, Tuesday’s showpiece was the last national Pacifica meeting on financial/audit matters before the referendum voting ends next Thursday, 19Mar, at 8.59pm PDT, 10.59pm CDT, & 11.59pm EDT.]
Mr Martin appended to his report WBAI’s FY2020 cashflow projection, with FY2018 & 2019 comparatives (year-end is 30Sep). This was taken from ICFO Tamra Swiderski’s undated cashflow report presented to the Th19Sep private PNB meeting. (Why private you may rightly ask – but that’s the default obdurate & deep secrecy culture permeating almost everyone occupying a seat on a Pacifica committee.) That report has individual FY2020 cashflows, with the two comparatives, for each of the five stations, the Radio Archives & National Office, & then an aggregation of the seven (consolidation, in the jargon).
Cashflow statements must be interpreted carefully, not least because they ignore both expenses that have accrued (so not yet billed) & revenues that have been deferred (again, not yet billed). Given Pacifica’s activities, especially how revenues are generated, cashflow statements materially underestimate its accrued financial position, & therefore whether creditors are smiling or frowning, & how intensely.
Please note that given the ICFO’s assumptions, KPFA’s cumulative cashflow deficit for the three years to 30Sep2020 is $1 091 306, more than 2½ times that of WBAI’s. Lest anyone think this is just about the past, KPFA’s deficit for the year just startedisprojected to be $658 207. They don’t tell you those three facts in quite a few Pacifica forums. Such is the work of ideology, here that of California station chauvinism, exhibited as separatism, not solidarity.
Cited, & attached, is what’s purported to be ICFO Tamra Swiderski’s cashflow projection for FY2020 (so the year ending 30Sep2020), with FY2018 & 2019 as comparatives. It’s undated, but the original filename includes the phrase “Pacifica Cash Flow Presentation 9.19.19”.
Another worker in Switzerland had passed this to me at the beginning of the month, but that copy lacked explanatory notes, esp. assumptions, so it made no sense publishing it. GA’s copy has the list of assumptions, plus the data for National Office & Pacifica Radio Archives. So here it is:https://mega.nz/#!mmZUkICB!1c74TQ4oTKyQ6dHNB_h5eLYHspltLDujlGFbEcj-X_c.
Note that for WBAI alone, it says “Assumes not funding Central Services FY20” (page 4). Oh. In the absence of a recommendation by the PNB Finance Ctteeon the financial dimension of WBAI’s future, & no decision made by the PNB itself, why is this assumption in a fundamental planning document, such as Pacifica’s FY2020 cashflow projection? Who’s doing the planning here for a radically different WBAI?!? If this isn’t evidence of planning between the Interim Chief Financial Officer & the Interim Executive Director, I don’t know what is.
What was that date, again? “Pacifica Cash Flow Presentation 9.19.19”, Th19Sep2019. So perhaps presented at the private PNB session that evening. 2½ weeks later, home invasion station invasion. Will this be raised at the PNB, in a public session, calling these individuals to account? Don’t hold your breath.
I’ll discuss Ms Aaron’s piece in a summary post next week.
Wake Up Before Our Buildings are Sold!
Pacifica iED, John Vernile, has laid off all staff at WBAI, taken control of their transmitter and is broadcasting shows from other stations. This was done without Pacifica National Board approval. John Vernile never gave prior notice or a plan to every member of the PNB.
This action coupled with inaction to remedy financial shortfalls at all of our stations may very well result in the forced sale of our buildings.
Recent weak fund drives at all of our stations indicate that our financial crisis cannot be attributed solely to shortfalls at WBAI. Bequests in 2019 at KPFA, KPFK, WBAI and the National Office have kept the Foundation afloat. However, bequests are rare, so income projections cannot include them. See the attached cash flow report from our iCFO. Scroll down to see the actual income and expenditures for 2018 and 2019 as well as projections for 2020. Significantly increased spending on the Pacifica National level in 2019 of about $600,000 above 2018 must be factored in to any financial analysis. This increase in expenses dwarfs any WBAI shortfalls. Therefore, even if WBAI disappeared (ie- no income/no expenses) predicted fund drive underperformance at the other stations coupled with out of control spending at the national level will rapidly create a cash crisis that may very well result in the forced sale of our buildings.
1) To my knowledge as a PNB Director, Mr. Vernile has neither calculated nor communicated the financial ramifications of the shutting down of operations at WBAI. Initially, it will mean the loss of at least $200,000 to $300,000 in income from the WBAI fall fund drive. The laying off of staff without proper notification of the WBAI Union will most likely result in legal expenses, arbitration costs, etc. Severance payments will have to be made to employees who are laid off. Where will the money for that come from? Legal challenges have already ensued. Travel, hotel and other expenses are being incurred without PNB approval. Instead of ameliorating Pacifica’s cash flow crisis the shuttering of WBAI has exacerbated it.
2) No income generating mechanism has been put in place to replace the income currently brought in by WBAI. In order to maintain the WBAI license it will have to be kept on the air. That means that the overhead of the transmitter rent owed to 4 Times Square of almost $18,000 per month will have to be paid by the National Office or the other stations. At least one WBAI staff member will have to be paid. This will most likely mean an additional $10,000 per month in expenses. Thus, overhead of about $28,000 per month will have to be paid without any income coming in from WBAI unless there is some plan that has not yet been communicated to the PNB for income generation.
3) The sale or swap of a signal is a lengthy process. A reasonable estimate is that it would take at least 1 ½ years and is, therefore, not an option that would prevent the forced sale of our buildings if we are not able to meet payroll at one or more of our stations or if a vendor or creditor takes legal action against us, which appears more likely than not in the next few months. Three National Board Directors, Nancy Sorden from WPFW, Lawrence Reyes from KPFK and myself, Grace Aaron from KPFK spoke with Marc Hand, who is an expert on signal sales and swaps. He verified that the sale or swap of a radio license is, indeed, a lengthy process. To explain, first a buyer or swap opportunity for a signal has to be found. Terms have to be negotiated. Next, the National Board has to agree to the swap or sale. Then the exact terms of the swap or sale have to be communicated to all members of the Pacifica Foundation and they must vote to approve the sale or swap. A 10% quorum has to be reached. If the membership approves, Pacifica would submit an application for approval of the specific swap or sale to the Federal Communications Commission. The FCC process takes a minimum of 90 days. In that 90 days is a 30 day public comment period. If there are any objections the FCC investigates them which adds at least 2 or 3 months to the process. Also, it is not legal to borrow money against a potential signal sale or swap. Bankruptcy would add another layer of approval to any signal sale or swap process, thus lengthening the process not expediting it.
4) Initially, if there is a lack of cash, vendor payments will be delayed. This is already happening at the National Level. The next step if income cannot meet expenses will be the inability of more stations or units to meet payroll. It can be predicted that the first step will be for the National Office to use the $200,000 set aside to make payments on the $3.2 million loan to meet payroll or emergency vendor payments. After that there will be no buffer whatsoever. There is no other reserve. Pacifica will not be able to make scheduled payments on the loan. Bankruptcy will be the only option. This will trigger the calling in of the loan by the lender to protect the lender’s interests from a Pacifica bankruptcy filing. Then our buildings will be foreclosured on and the forced the sale of our buildings will take place to cover the $3.2 million principal owed as well as pay employees and other pressing obligations.
Is there a Solution?
In times of great stress, it is tempting to reach for quick, magical solutions. Although these can sometimes pan out in rare instances, this would be a very risky course of action. Staff, Board members, volunteers and others should be encouraged to seek help from major donors, etc., but the most likely way to stave off the forced sale of our buildings is to do the usual, not the unusual. In that light I propose the following:
1) That the actions taken against WBAI be reversed immediately and that WBAI resume its fall fund drive.
2) That all efforts be made to improve the performance of fall fund drives across the network.
3) Our unions should be consulted and immediate union negotiations be started to help us reduce our salary and benefits expenses in a humane manner.
4) Plan and execute a network-wide national fund drive to bring in extra resources.
5) When finances permit, consider hiring a National Development Director to pursue grants and major donor fund raising.
Should We Seek Outside Help, Change the Board Structure, Replace Governance and Follow Experts?
Commercial and public radio, newspapers, public TV and internet media are in terrible shape. Experts galore have not found a solution to the changing media landscape which is causing the rapid decline in income of most traditional media sources with resources moving to social media.
There is also the demise of Air America, Current TV and Al Jazeera English.
I doubt that ‘experts’ are the answer. But, hey, someone at the LA Times reached out to a billionaire who bought that newspaper and is spending a lot to revive it. So if anyone knows a billionaire, please reach out!
That’s all for now.
Grace Aaron, Pacifica National Board Director from KPFK