2Apr2018, Pacifica took out a $3.7m loan (now $3.265m) from the Foundation for the Jewish Community, FJC, a donor-advised funds holder. A week or so later than expected, this is the auditor’s report on their FY2019 financial statements (year-end 31Mar), dated 27Aug2019:
P.S. Promise I didn’t get the pic from Patty Lipshutz, MoMA employee, the Museum of Modern Art, NYC, its longstanding chief legal counsel & Secretary – also Vice-President & Secretary of the Marty & Dorothy Silverman Foundation. Perhaps no surprise she’s married to a Silverman, Lorin, who happens to be not only President & Treasurer of the Marty & Dorothy Silverman Foundation but also President & Treasurer of FJC, and founder & President of F. Y. Eye, Inc., an advertising broker, which Pacifica has a $37k contract with for on-air & website advertising, the euphemistic underwriting.
[Note that, despite what some Pacifica directors & others say, FJC do sell on their loans, to the Marty & Dorothy Silverman Foundation. Just ask Patty, or Lorin – or daughter Allison, a director of the Marty & Dorothy Silverman Foundation, and VP, Strategy & Operations of F. Y. Eye, Inc. Selling on a loan happened again in FY2019: “[d]uring the year ended March 31, 2019, the private foundation purchased one loan totaling approximately $1,018,201” (p. 17, my emphases; p. 19 of the PDF). This is as per policy: “[s]ince its inception, any loans that were determined by FJC to be potentially impaired were purchased in full by a private foundation” (p. 11; p. 13 of the PDF). That’s right, folks, FJC never wait for a borrower to default. Pacifica’s loan, & the liens on its properties, may just get sold on without the chance to go to court. Capitalist right is capitalist right, the right to dispose of one’s assets as one sees fit.]
[I misunderstood the PNB Finance Cttee motion, mistaking “station membership” for listener-members only. I was misled by the discussion focusing on listeners, not members consisting in listeners plus staff. Apologies. However,my points are unaffected, as are the computations; the text has not been revised. The motion is given correctly by WBAI Treasurer R Paul Martin in his report: “The NFC recommends that the quarterly interest payments starting with December 2019, be apportioned by station membership as of December 1, 2019, and revised annually according to changes in membership” (page 4, link given below).]
~~~~~~~~~~~~~~~
Last night’s PNB Finance Cttee decided that station listener-membership alone should decide the split of the $67k going each quarter to the Foundation for the Jewish Community, FJC. So, KPFA 31%, KPFK 29%, KPFT 8%, WPFW 14%, WBAI 18%. This was the Cttee’s recommendation to the Pacifica National Board about the $3.265m loan (46:52; the vote was 7-2-1, that is, 7 for (including KPFA listeners-delegate/Pacifica director/Finance Cttee Chair Chris Cory, & KPFK listeners-delegate/Treasurer Fred Blair), 2 against (KPFK staff-delegate/Pacifica director Mansoor Sabbagh, & WPFW listeners-delegate/Treasurer Nick Arena), 1 abstained (KPFA listeners-delegate/Treasurer Sharon Adams)). The PNB next meets Th19Sep. https://kpftx.org/archives/pnb/finance/190910/finance190910a.mp3
These are the station charges, quarterly & monthly: KPFA $20 876, $6 959; KPFK $19 529, $6 510; KPFT $5 387, $1 796; WPFW $9 428, $3 143; WBAI $12 121, $4 040. FJC’s quarterly charge to Pacifica is $67 340, at the new interest rate since 1Aug2019 ($3.265m x 8.25% ÷ 4). (WBAI Treasurer R Paul Martin’s own calculation for WBAI gave $12 600 (page 5, https://glib.com/treasurers_report_2019-09-11.pdf): he took the quarterly as a round $70k.) Station listener-membership was given in National Elections Supervisor Renee Penaloza’s 28Aug report (unpaginated p. 1): http://elections.pacifica.org/wordpress/wp-content/uploads/2019/08/Election-Report-08.28.19.pdf.
How feasible is it that WPFW & WBAI, in particular, will make these contributions? Contributions due to FJC, contractually within five days, on 2Jan2020, 2Apr2020, 2July2020, 2Oct2020, 2Jan2021, & 2Apr2021? Contributions, at the current 8.25% annual interest rate, totalling $56 568 by WPFW & $72 726 by WBAI?
There are three obvious sets of facts indicating that they won’t make their contributions:
1) In June-July, neither WPFW nor WBAI could pay either payroll or health insurance (Interim Chief Financial Officer Tamra Swiderski, 32:19, Tu9July PNB Finance Cttee, https://kpftx.org/archives/pnb/finance/190709/finance190709a.mp3). She was ‘economical with the truth’: they both had to borrow from the Foundation’s national account.
2) WBAI forecast that FY2019 (so to 30Sep) will be a loss of $318k, & they’ve budgeted FY2020 as a $316k loss. Honest, one may say, but no less worrying for that. This info comes from today’s WBAI Treasurer’s report (p. 5).
3) The much trumpeted coming recession.
Intention & action are unavoidable in both PacificaWorld & RealWorld. But in PacificaWorld they tend to be more independent of the means at hand. But even in PacificaWorld there comes a time when RealWorld intrudes so much that the train hits the buffers: the state & the market discipline all, not least by the inevitable onset of capitalist slump.
In these urgent times, there’s more talk now in Pacifica public meetings of cost cutting, rather than just raising revenue. Reality is biting. The acute cashflow can only be alleviated temporarily by The Golden Corpses, the bequests. Because relentless are the costs of the living: workers, 53% of expenses (FY2016 auditor’s report, p. 5a, https://mega.nz/#F!6uwhAQIY!-QW2NXuAc6rRdWE5KbNb6w?mqw32KrI – FY2017’s financial statements are effectively worthless because their material accuracy wasn’t vouched for by the auditors due to insufficient auditable evidence; please see https://pacificaradiowatch.home.blog/2019/07/19/fy2017-auditor-refuses-to-declare-that-the-statements-are-materially-accurate/). And the paid workers are mainly in California: KPFA, 30%of wage costs; KPFK 26%; KPFT 8%; WPFW 9%; WBAI 9%; with 5% at Radio Archives & 11% at National Office (FY2016 auditor’s report, p. 26; two percentage points lost by rounding).
So firings will be largely in California – fuelling both Californian station chauvinism & its correlate, Californian resentment. This affective dynamic splinters clear thinking, unleashing centrifugal forces, ripping at those ties that still hold the network together.
The core of the PNB majority has been counting on not having to make any fundamental decisions. It was hoping to muddle through, & then re-finance the FJC loan during summer 2020, relying on the three Pacifica buildings as collateral, & using as positive evidence the auditor’s reports of FY2017, FY2018, & FY2019. But RealWorld reality intruded, & I’m not talking about FY2006 being the last annual net income: the 2017 statements were rendered effectively worthless, & the auditor told the M19Aug PNB Audit Cttee (20:15) that the same fate beckons for the 2018 ones. Maybe the 2019 statements, the first with NETA either doing or supervising the bookkeeping, will earn an auditor’s unmodified opinion. https://kpftx.org/archives/pnb/audit/190819/audit190819a.mp3; https://pacificaradiowatch.home.blog/auditor-s-reports-from-fy2005/ (notes 3(b) & 4)
1) WBAI listeners-delegate/Pacifica director James Sagurton had asked at Tuesday’s PNB Finance Cttee if figures were available for ‘station revenue per member’ (42:53). None was at hand. Now they are.
The matter isn’t as transparent as it seems; for example, the FY2016 stations statement includes “[g]rants and contributed income” & “[o]ther revenue”. It’s not apparent how members are involved in these categories of fundraising. Given this, an obvious approximation is the ratio, for each station, between “[l]istener support and donations” & number of members (total of listeners & staff). Data are publicly available for FY2016, & one can use the 2016 LSB elections record date at 30June.
So to answer Mr Sagurton’s query, the figures vary from $128 to $176 per member (37.5% more), & harbour quite a surprise, the station in DC: KPFA $176.30 (2836208÷16087); KPFK $168.38 (2504410÷14874); KPFT $127.52 (753499÷5909); WPFW $169.32 (883693÷5219); WBAI $153.52 (1200676÷7821) – FY2016 auditor’s report, p. 25, https://mega.nz/#F!6uwhAQIY!-QW2NXuAc6rRdWE5KbNb6w?mqw32KrI; & NES Penaloza’s final report on the nominal 2018 pseudo-election, p. 19, p. 20 of the PDF, https://mega.nz/#!fyAwGICZ!-4uWYMHZW3CHxt6yCOITu006SVZ4AyNPjT9bWw6csb0.
2) Ability to perform, a kind of capacity, is a socialist, humanist, rational criterion of expected just contribution to collective human endeavour. That a station raises money shows it has the ability to somewhat pay the network’s bills, & it’s a crude measure of this capacity. So, in 2016, the latest FY we have audited figures for, what proportion did each station contribute? KPFA 34.7% (2836208/8178486, the five-station total of ‘listener support & donations’ – see the above p. 25), KPFK 30.6%, KPFT 9.2%, WPFW 10.8%, WBAI 14.7%. These certainly share a PacificaWorld ballpark with the Finance Cttee’s 31-29-8-14-18 that use data three years later, those of the late Aug2019 membership. (That even now there is no evidence available to members & listeners that the membership records, & elector rolls, are materially accurate, we’ll leave to one side. And, given this, any assertion by NES Penaloza will be treated for what it is.)
FJC gets award from Marc Hand, Pacifica’s fixer for the FJC deal (Mark Cohen; Erin Moran)
On 2Apr2018, Tom Livingston & Lorin Silverman signed the $3.7m loan contract between Pacifica (legally the Pacifica Foundation, Inc.) & the Foundation for the Jewish Community (legally FJC). Pacifica’s broker was Public Media Company (PMC), which had put Chief Executive Officer Marc Hand on the case.
A few months later, the July issue of FJC Quarterly showed what happens when business goes well. The joyous occasion was attended by Marc, of course, together with Mark C Cohen, FJC’s Chief Legal Officer (& Assistant Secretary), & Erin Moran, PMC’s Chief Financial Officer. There was talk of FJC, of course, & of PMC, & some gift-giving & -receiving – but no mention of Pacifica. Even so, a one-year anniversary deserves celebration, don’t you think? http://fjc.org/uploads/newsletters/0047-july-2018-newsletter.pdf
And business did go well. PMC earnt their origination fee. OK, only 1.5% you may say, but that is $55 500 (the loan agreement, Section 3.1(2); page 6). And that payment came from Pacifica listeners: Pacifica has agreed to pay all costs arising from the contract – “[to] pay legal and other loan related fees” (Recital B; p. 1), & “at Borrower’s cost and expense, each in form and content satisfactory to the Lender” (Sec. 3.1(1)-(11); pp. 6-7). https://mega.nz/#F!PloCiSqJ!9rLejSkttE7gCVCCq3q86g?b0IBlaiR
And FJC, just by sitting there, earnt its own consideration (benefit), but decided to forego its origination fee, instead plumbing for underwriting credits of 1% of the loan amount, so $37k (Sec. 3.1(2); pp. 6-7; & p. 25). So, rather than take money directly from the listeners, they chose to make Pacifica enter into an advertising contract. (That suited Pacifica financially, if not politically – please see link at the end.)
Pacifica’s advertising contract is to be with F.Y. Eye, Inc. (Exhibit B; pp. 25-7), an advertising broker in NYC. I wondered why FJC didn’t take cash from Pacifica, for the benefit of the FJC account holders funding the loan. Now I know why – and I’ll give the answer in the next poston these matters.
[AN ASIDE: Note that Pacifica’s interest rate falls by 0.25 percentage points, to 8.25% a year, from tomorrow, Th1Aug. The change was made today by a Federal Reserve cttee that decides a rate that prime & others are tied to. The saving is smaller than you think: $8 162.50 a year (1% is $32 650). But mustn’t grumble. https://www.jpmorganchase.com/corporate/About-JPMC/historical-prime-rate.htm ]
charities as capital, M-M´ . . . richer charities (non-profits, of course) making money out of poorer ones
The questions arise because of the secrecy culture that Pacifica is notorious for. Pacifica office-holders, since the end of last summer, have consistently chosen not to utter the word ‘FJC’, the Foundation for the Jewish Community which lent Pacifica $3.7m on M2Apr2018. At that time Pacifica proudly issued a press statement, & not only named FJC but devoted a paragraph to their activities. The websites of Pacifica stations proudly carried it, two of them to this very day. (The word ‘FJC’ also appears in two other publicly available documents, ones that Pacifica paid for – more precisely, have been invoiced for: the auditor’s reports for FY2016, dated 31May2018, & FY2017, dated 27June2019.)
Given this, it’s reasonable, & diligent, to ask whether FJC still own the loan.
The Marty & Dorothy Silverman Foundation (MDSF) was almost wholly responsible for creating in 1995 the Foundation for the Jewish Community (FJC). The president of FJC is Lorin Silverman, the son. FJC has a policy, declared in their auditor’s reports, of not going to court when a borrower defaults. No, no, nothing as unsavoury as that. Bad publicity too. Money-men pursuing charities. That wouldn’t do. No. Best keep things quiet, keep everything civil. Instead, FJC sells to MDSF, at no discount, the loans they assess as being only “potentially impaired”, the phrase used in their auditor’s reports; this is the latest one, year-end 31Mar2018, dated 22Aug2018: http://fjc.org/uploads/user-uploads/image/FJC%203-31-18%20FINAL.pdf (pages 10 & 11, pp. 12 & 13 of the PDF)
It was disclosed at the M15July Audit Cttee that, quite remarkably, Pacifica has nothing in writing from FJC (or whoever is now the lender) permitting Pacifica to be currently violating the loan conditions. Oh. That’s quite different from when the loan started on 2Apr2018: ED Tom Livingston said in an Apr2018 email, kindly sent to me by Grace Aaron, that “[t]he Board has been told it has a 6 month waiver of the loan covenants.” (Bear in mind, he didn’t say ‘has received a written waiver’ – only “told”.) So that ran out 1Oct2018. It is important to note that in no publicly available document or audiofile has there been mention of this topic – until the 15July meeting.
At this meeting was George Walter, a Senior Controller at NETA, the National Educational Telecommunications Association, which since Sep2018 has done Pacifica’s bookkeeping & accounting. Also present was Jorge Diaz, a Principal Auditor at Rogers & Co., which did the FY2017 audit & are currently doing the 2018. The George & Jorge Show. And they both take a nice pic, yes? https://www.netaonline.org/OurStaff (last Controller pic) & https://www.rogerspllc.com/about/leadership/jorge-diaz-cpa/
George, when asked by Marilyn Vogt-Downey (WBAI listener delegate) about the submission of Pacifica documents within 120 days to the lender of “the $3.2m loan”, replied, “we’re, we’re off, but they know, & they’re urgh, urgh, they’re, they’re content” (16:45, https://kpftx.org/archives/pnb/audit/190715/audit190715a.mp3). Not surprisingly he was pushed further – and, for recent Audit Cttee meetings, it was in a totally unexpected direction. Polina Vasiliev (KPFK staff delegate) asked about “our New York lender” being OK with the loan condition violations: “do we have that in writing?” (21:39). George was as decisive as ever: “[pause] um, [pause] no, urgh, that’s my, urgh knowledge” (22:04).
Then Audit Chair Eileen Rosin dived in, prompting the witness. Tut-tut. Auditor Jorge then tried to assist. Polina persisted, & George, to his great credit said, “[r]ight, & so, t-to my knowledge there’s no, no written waiver. Um, urgh-urgh, it’s very possible that we’ll, urgh, urgh, get one” (23:05). Which only raises the question, why hasn’t a request for a written waiver been made?!? Why has this situation been allowed to arise, & to persist?And was there a written waiver for 2Apr-1Oct2018?And a written waiver for 2Oct2018-1Apr2019?There’s something not quite right here. Something fishy . . . Oh. So, nothing in writing. Oh. And the annual default interest rate is the lesser of either 18% or the maximum legal rate (clause §1.1(10) of the FJC loan contract).
One could have done a separate post on the Eileen & George Double Act that followed, doing a spiel with such gems such as, “the lender is actually a non-profit lender, it’s not like any ordinary bank, I guess […] I’m guessing they would tend to be a bit more lenient than, you know – more willing to work with their clients” (Eileen, 24:14), & “it doesn’t help them to er, to er, to, to threaten default on the loan […] that would be, urgh, not in their interest” (George, 24:44). And FJC’s fiduciary duty towards the donors whose money (& other assets) it now manages? Get real. That’s why FJC’s dodgy & troublesome loans, when they’re simply “potentially impaired”, not even defaulting, are sold on to the Marty & Dorothy Silverman Foundation.
Lastly, Marilyn reminded everyone (25:11), that it had been said, mistakenly, that Pacifica had been promised orally by Empire State Realty Trust that they didn’t have to pay all the monthly rent for housing the WBAI transmitter (Marilyn could have been explicit, saying that the determination of this belief as false was by the court). But to return to the main matter: why won’t people be upfront, & speak of FJC’s business relationship with the Marty & Dorothy Silverman Foundation?
Recorded Pacifica public meetings – less so the very few published Pacifica documents – have been full of misdescriptions, being misleading, false, even what can only be deemed deliberate falsehoods, intended to reassure, placate, obscure, confuse, & mislead. From the naive to the wilful. This sorry state of affairs refers to both the $3.265m loan conditions & FJC.
Just in case one may think ‘a nod & a wink’ will suffice, just check the FJC contract. It’s explicit & unambiguous on the degree of legal force held by what is believed to be an oral understanding or agreement: none, in a word. The pertinent passage:
“[t]his Agreement and the other Loan Documents embody the entire agreement and understanding between Lender and Borrower and supersede all prior agreements and understandings between such parties relating to the subject matter hereof and thereof. Accordingly, the Loan Documents may not be contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the parties. There are no unwritten oral agreements between the parties” (Article 10 Miscellaneous, Section 10.21 Entire Agreement, my italics & bold; p. 18)
A final, crucial point which will be addressed later. Except when the loan was taken out, those in the know have consistently never said who owns the loan –FJC may have sold it on. It may have already been sold to the Marty & Dorothy Silverman Foundation. Indeed, that foundation may even have sold it on. We simply don’t know. Secrecy culture breeds suspicion. It corrodes trust. It undermines the organisation. It’s simply destructive.
Was the 2Apr-1Oct2018 waiver in writing? If not, why? Was there a written waiver for 2Oct2018-1Apr2019? If not, why? Why hasn’t there been a written waiver for 2Apr-1Oct2019? Why did NETA, Pacifica’s supposed competent accountant, not tell ED Maxie Jackson that one was needed? Why didn’t Jackson insist on one? Why didn’t the Pacifica directors do likewise?
The Pacifica National Board needs to disclose who owns the $3.265m loan. Is it still FJC?
Or, if names are not to be named, has Pacifica’s lender changed, & if so, how many times?
The Pacifica advocates of the loan from the Foundation for the Jewish Community, FJC, have presented it as a good Samaritan, doing it out of the kindness of its heart. In fact, FJC is in a competitive market as a manager of donor-advised funds, a sector of the charity industry. One of its money-making operations is running a fund that lends at prime-plus, the Agency Loan Fund, ALF. Donors to FJC can lodge money with ALF, as can outsiders, all hungry for those extra percentage points of interest earnt.
FJC had been having problems finding borrowers for these prime-plus loans: only 46% of ALF had been converted into loans at 31Mar2018, the very time of the 2Apr Pacifica loan (its latest auditor’s report, year-end 31Mar2018, page 20; page 22 of the PDF). So, of course, Pacifica was welcomed with open arms. Sentiment this was not. http://fjc.org/uploads/user-uploads/image/FJC%203-31-18%20FINAL.pdf
The greatest aid to Pacifica transparency, on this or any matter, has not come from the National Board, the PNB. No, this came with the documents leaked W26June2019 on a Facebook group, then co-moderated & -administered by Grace Aaron. She was then, as now, Chair of the Pacifica Foundation. Most of the documents concern the loan from FJC. https://www.facebook.com/groups/PacificaRadiowaves/permalink/1264765520345396/
The ‘root’ contract, called the “loan agreement”, 2Apr2018, signed by Pacifica Interim Executive Director Tom Livingston & FJC President Lorin Silverman:
There’s also an advertising (underwriting) contract as part of the loan, signed 23Mar2018 by iED Livingston; please see below.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The $3.7m loan was reduced to $3.265m loan when Pacifica was unable to collateralise the KPFK transmitter site lease, at Mount Wilson. This was because it’s federal land administered by the Dept. of Agriculture Forest Service, & they wouldn’t give the necessary permissions. (The documentary evidence is contrary to the story being told in 2018 by Grace Aaron et al. that the attempt was to collateralise the transmitter, not the site lease – please see the loan agreement, Sec. 2.1(d); p. 5.)
What did the Pacifica National Board (PNB) commit the members to when it accepted FJC’s offer of the money?
the signed loan agreement is dated 2Apr2018, & it has a three-year term;
significantly, Pacifica directors agreed to a contract that details only two ways to pay the principal by 2Apr2021: selling as many broadcasting licences & station buildings as it takes: “a swap or sale of one or more radio licenses or a sale of other Pacifica owned assets” (Recital B; page 1);
annual interest at three percentage points above US prime rate (Section 2.2; p. 5). (So, an annual 7.75% when the loan started; 8%, effective 14June; 8.25%, 27Sep; 8.5%, 20Dec2018. [UPDATE: 8.25%, effective Th1Aug2019; 8%, Th19Sep; 7.75%, Th31Oct; 7.25%, W4Mar2020; 6.25%, M16Mar.] The three-year interest charge, with the coming recession dragging down the rate, will be less than $800k.);
the default rate, such as after a late payment – not least the paying of the principal on time (Sec. 8.1; p. 13) – is the lower of either 18% a year or the maximum under law (Sec. 1.1(10); p. 2);
Pacifica directors, with no public discussion, agreed to carry advertising, & on 23Mar2018 signed a contract with an advertising broker, F. Y. Eye, Inc.; FJC chose to make Pacifica do this “in lieu” of its “origination fee” (Sec. 3.1(2); pp. 6-7), & you may wonder why – details below; &
FJC never waits for a loan to default: it sells the loan on when it’s only “potentially impaired”, to the Marty & Dorothy Silverman Foundation; details below.
Pacifica’s immediate future is structured more by this contract than anything else.
~~~
PACIFICA’S $37 000 ADVERTISING CONTRACT with A FJC ‘DAUGHTER’ CORPORATION
As part of the FJC contract, on 23Mar2018 iED Tom Livingston signed an underwriting contract on behalf of Pacifica, for it to carry advertising. This hasn’t been acknowledged publicly by any Pacifica body, not least the Pacifica National Board (PNB). The details now follow.
Appended to the loan agreement, signed by Pacifica & FJC, is an unsigned underwriting contract (pp. 25-7). It is “substantially in the form” that Pacifica has agreed to sign with the NYC advertising broker, F.Y. Eye, Inc. (Sec. 3.1(2); pp. 6-7 & 25-7) – a corporation founded by its president, Lorin Silverman . . . yes, the President & Treasurer of FJC, and President & Treasurer of the Marty & Dorothy Silverman Foundation (of which, more anon). And, yes, it was Lorin’s signature that lent the money to Pacifica.
The language here is odd because IED Tom Livingston actually signed an advertising contract a week earlier, on 23Mar2018. The contract is with F. Y. Eye, Inc., & it’s dated 2Apr2018 (linked below). Signing for the latter was its President, Lorin Silverman (yes, a busy guy). Pacifica has publicly issued no document demonstrating that Livingston had been authorised by the PNB to do this. Likewise, there is no public Pacifica document showing that the PNB had agreed to advertising via the FJC loan. Such is the life of a secret society – moreover, one funded directly by the members, members who were never consulted on this matter. Moreover, members who have never shown any evidence, at any time in Pacifica’s 73-year history, of being enamoured to advertising on the Pacifica airwaves. Such is the anti-democratic disposition of the PNB majority. Shameless authoritarians. Eat yer heart out, Lew.
The Pacifica advocates of the loan from the Foundation for the Jewish Community, FJC, have presented it as a good Samaritan, doing it out of the kindness of its heart. In fact, FJC is in a competitive market as a manager of donor-advised funds, a sector of the charity industry. One of its money-making operations is running a fund that lends at prime-plus, the Agency Loan Fund, ALF. Donors to FJC can lodge money with ALF, as can outsiders, all hungry for those extra percentage points of interest earnt.
FJC had been having problems finding borrowers for these prime-plus loans: only 46% of ALF had been converted into loans at 31Mar2018, the very time of the 2Apr Pacifica loan (its latest auditor’s report, year-end 31Mar2018, page 20; page 22 of the PDF). So, of course, Pacifica was welcomed with open arms. Sentiment this was not. http://fjc.org/uploads/user-uploads/image/FJC%203-31-18%20FINAL.pdf
The greatest aid to Pacifica transparency, on this or any matter, has not come from the National Board, the PNB. No, this came with the documents leaked W26June2019 on a Facebook group, then co-moderated & -administered by Grace Aaron. She was then, as now, Chair of the Pacifica Foundation. Most of the documents concern the loan from FJC. https://www.facebook.com/groups/PacificaRadiowaves/permalink/1264765520345396/
There’s also an advertising (underwriting) contract as part of the loan, signed 23Mar2018 by iED Livingston; please see below.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The $3.7m loan was reduced to $3.265m loan when Pacifica was unable to collateralise the KPFK transmitter site lease, at Mount Wilson. This was because it’s federal land administered by the Dept. of Agriculture Forest Service, & they wouldn’t give the necessary permissions. (The documentary evidence is contrary to the story being told in 2018 by Grace Aaron et al. that the attempt was to collateralise the transmitter, not the site lease – please see the loan agreement, Sec. 2.1(d); p. 5.)
What did the Pacifica National Board (PNB) commit the members to when it accepted FJC’s offer of the money?
the signed loan agreement is dated 2Apr2018, & it has a three-year term;
significantly, Pacifica directors agreed to a contract that details only two ways to pay the principal by 2Apr2021: selling as many broadcasting licences & station buildings as it takes: “a swap or sale of one or more radio licenses or a sale of other Pacifica owned assets” (Recital B; page 1);
annual interest at three percentage points above US prime rate (Section 2.2; p. 5). (So, an annual 7.75% when the loan started; 8%, effective 14June; 8.25%, 27Sep; 8.5%, 20Dec2018. [UPDATE: 8.25%, effective Th1Aug2019.] The three-year interest charge, with the coming recession dragging down the rate, will be less than $800k.);
the default rate, such as after a late payment – not least the paying of the principal on time (Sec. 8.1; p. 13) – is the lower of either 18% a year or the maximum under law (Sec. 1.1(10); p. 2);
Pacifica directors, with no public discussion, agreed to carry advertising, & on 23Mar2018 signed a contract with an advertising broker, F. Y. Eye, Inc.; FJC chose to make Pacifica do this “in lieu” of its “origination fee” (Sec. 3.1(2); pp. 6-7), & you may wonder why – details below; &
FJC never waits for a loan to default: it sells the loan on when it’s only “potentially impaired”, to the Marty & Dorothy Silverman Foundation; details below.
Pacifica’s immediate future is structured more by this contract than anything else.
As part of the FJC contract, on 23Mar2018 iED Tom Livingston signed an underwriting contract on behalf of Pacifica, for it to carry advertising. This hasn’t been acknowledged publicly by any Pacifica body, not least the Pacifica National Board (PNB). The details now follow.
Appended to the loan agreement, signed by
Pacifica & FJC, is an unsigned underwriting contract (pp. 25-7). It
is “substantially in the form” that Pacifica has agreed to sign with the
NYC advertising broker, F.Y. Eye, Inc. (Sec. 3.1(2); pp. 6-7 &
25-7) – a corporation founded by its president, Lorin Silverman . . .
yes, the President & Treasurer of FJC, and President & Treasurer
of the Marty & Dorothy Silverman Foundation, which buys FJC loans
that are “potentially impaired”, not even in default (FJC policy,
disclosed in any of their auditor’s reports & IRS form 990’s – the
latest: pp. 10-11, pp. 12-13 of the PDF, http://fjc.org/uploads/user-uploads/image/FJC%203-31-18%20FINAL.pdf; & Schedule O, p. 90 of the PDF, http://fjc.org/uploads/user-uploads/image/file/990%20FY17%20-%20For%20Distribution.pdf). And, yes, it was Lorin’s signature that lent the money to Pacifica.
It should be noted that the chronology in the loan agreement, the talk of ‘Pacifica has agreed to sign’, has to be juxtaposed with the fact that this advertising agreement was actually signed just over a week earlier, on 23Mar2018. It was done by iED Tom Livingston, a contract with F. Y. Eye, Inc., dated 2Apr2018 (linked below). Signing for the latter was its President, Lorin Silverman (yes, a busy guy). Pacifica has publicly issued no document demonstrating that Livingston had been authorised by the PNB to do this. Likewise, there is no public Pacifica document showing that the PNB had agreed to advertising via the FJC loan. Such is the life of a secret society – moreover, one funded directly by the members, members who were never consulted on this matter. Moreover, members who have never shown any evidence, at any time in Pacifica’s 73-year history, of being enamoured to advertising on the Pacifica airwaves. Such is the anti-democratic disposition of the PNB majority. Shameless authoritarians. Eat yer heart out, Lew. https://mega.nz/#F!PloCiSqJ!9rLejSkttE7gCVCCq3q86g?qkxynCxQ
PacificaWatch 