Very Important Things You Need to Know
We've talked for months about the lawsuit filed by the Empire State Realty Trust (ESRT) against Pacifica. The judge will hear the case on Oct. 4 and there are some very important things you need to know. I wish I had good news but I don't, and I want to remind all of you how serious this is. If you think that this does not matter to you because you are involved with other stations than WBAI in NYC, you are wrong. This will dramatically affect EVERY station in Pacifica.
If you've forgotten about the details of this case, it's about unpaid tower rent and fees at the Empire State Building, where WBAI has its transmitter and antenna. The lease was renewed in 2005 with terms that make it unsustainable - including fees that have increased at more than four times the rate of inflation since then. WBAI managed to catch up on those fees in 2014, but has been unable to keep up with the ever-increasing fees since then. So ESRT, the current owner of the Empire State Building, filed a lawsuit against Pacifica last fall. More details are at wbai.org if you want more background.
But I want to stress that this is going to affect you, and your station, regardless of where you are in Pacifica. As I've been saying for some time, whether we reach a settlement agreement with ESRT for something less than the full amount for which they are suing us, or whether the court decides to award the full amount of the lawsuit to ESRT, Pacifica is going to have to come up with a lot of money in the very near future.
Depending on whether we can get a settlement agreement with ESRT or the judge issues a summary judgement, we'll probably have to come up with between $1.5 and 2.5 million very soon. All Pacifica stations can be dramatically and adversely affected by this, and we we all need to stick together to make sure we can get through it. I'm asking all of our LSBs and the PNB to please focus on this instead of fighting with each other, so that all of our stations and Pacifica can survive. Yes, it's that serious. Pacifica's debt is crushing us -- all of Pacifica -- and we have to deal with the ESRT lawsuit now, as it's the most immediate part of the financial crisis caused by our debt. But as I've been saying for months, unfortunately there's more.
The amount for which ESRT is suing us goes up each month as the unpaid fees accumulate. It's currently approximately $2.4 million. In addition, the lease goes until 2020, and there's an additional $2 million of lease obligations between now and then. We hope to get out of that future obligation, but the ESRT has been unwilling to negotiate (so far) and there's no assurance we can get out of that.
We don't know what the judge will decide on Oct. 4, but regardless of the specifics, we're still going to have to come up with a lot of money soon - we just don't know yet how much it will be or exactly when. But I think it's safe to assume that it will be at least $1.5 million.
What makes this even harder to deal with is that the $2.4 million that ESRT says we owe them now is part of a total of $7 to 8 million in debt that Pacifica has accumulated over the years. Frankly, I think this is due to financial neglect, but we need to focus on solutions, not blame. It's now coming down to the wire and we can't keep delaying getting that under control. Some stations have made changes this year in programming and personnel and have had some significant improvements in finances, but some others are still struggling, and we don't have the cash even with all of our bank accounts in all of Pacifica to pay what will be needed for the ESRT lawsuit.
We will probably have to borrow money for this, in order to get enough money fast enough to fund a settlement or summary judgement. But because of our terrible credit, we'll have to pay sub-prime interest rates. What we do not yet have is a plan to pay off those loans - only some suggestions. Failure to pay the loans would be just as bad as not paying a summary judgement in the lawsuit. This is something else the PNB will have to decide. Whatever it is, there will be some pain for all stations. The debt is a legal obligation of all of Pacifica, regardless of who signed the lease and which facility it's for. We all have to do our part to get past this, even if it hurts.
To make matters worse, we have unfunded employee pension payments that have also accumulated over recent years that also need to be addressed soon, and that I've told the GMs to plan for. We've found that the amount is larger than expected. See the FY2015 audit (pages 20-21) that was completed last month for the amounts due for FY2014 and FY2015. Additional amounts we owe for FY2016 and FY2017 are still being determined. This needs to be done in addition to paying whatever very large amount will be needed for the ESRT lawsuit. The total amount for pensions is probably between 3/4 and 1 million dollars, plus there may be additional penalties for late payments for past years.
I've asked for an executive session in Thursday's PNB meeting so that we can talk about strategies to deal with the ESRT lawsuit. It needs to be in closed session because we can't say things publicly that might interfere with getting a settlement in the lawsuit. I'm hoping that the members of the PNB who have insisted on making so many repeated objections that it takes 60 to 90 minutes in each meeting, just to get through agenda approval and minutes from the last meeting, to please not do that, and let us get on with the extremely important discussions and decisions that need to be made regarding this lawsuit.
I hope all of the fund drives now and in Oct. can surpass their goals, as we're going to need every bit of extra cash that we can get. I also hope all of you will make additional donations to your station (or directly to Pacifica) in the next few weeks, and ask your friends as well. I know that many KPFT members are dealing with flooded homes and cars because of Hurricane Harvey and won't be able to donate at all now, but I'm hoping that others can make up for that.
I've been telling all the GMs and the National Finance Comm. for many weeks that it's very important to produce surpluses (by reducing expenses and/or increasing revenues), as every station has debt (including to their own employees with the pension plan) that we have to get under control. One or two of the stations are saving money to pay those pensions, but others have not been able to get their finances under control enough to do that yet. This has to change, and the FY2018 budgets need to plan for the cash flow to fund pensions as well as to pay off loans for the ESRT lawsuit.
Let's please put aside our internal fighting, at least until we get this very real financial crisis under control, and remember that we are here for a very important reason - to ensure that we have Pacifica stations that can inform people that there are other ways than violence to resolve conflicts, stand up to the powerful political and economic interests, speak up for people who are oppressed because they have little political power, and more. We need to be there for future generations, as well as now, to provide independent news, music, and public affairs that other stations won't let you hear. Our country, and the world, need our stations to speak truth to power and stand up for peace and for rights guaranteed by the Constitution. But we won't have those stations to do that critically important work if we spend so much of our energies fighting with each other instead of facing the very real threat that the ESRT lawsuit is to all of us. Let's stand together for peace, for equal rights for all, for civil rights and the Constitution, for the environment, and for real news rather than fake news. Let's stand up for our stations and for Pacifica.
But to do all that, we have to do what's needed for our financial survival, and to make sure that all of our stations can continue providing the invaluable service that our country so badly needs.
Peace,
Bill
____________________
In the above message, Bill himself states "... we can't say things publicly that might interfere with getting a settlement in the lawsuit."
Why, for that matter, was the firing of Berthold Reimers not a number one priority? It is Reimers who has lied all along about the amount of money owed and the situation, in general. He was hired as a financial wizard who had the floaters WBAI needed. However, it did not take long to discover that he is but a 3rd-rate accountant with a seemingly inherent talent for larceny. Keeping Reimers and his appointed thugs on deck is tantamount to nursing a removable cancer.
Pacifica compounds its chances of an unfavorable decision by allowing the BAI bozos to publicly claim that the ESRT people are running a game on them. The station made a foolish mistake when it signed an agreement it could not honor and the Reimers thugs are clumsily and ever so transparently attempting to weasel out of it.
I cannot understand why Bill Crosier sanctions this infantile nonsense by not intervening. What do you think is really going on here? —Chris Albertson
Crosier is another worthless Pacifican. He won't fire Reimers, he does nothing about time wasters like Cerene and Adriana, except plead with them to be good, like the pansy he is. He's pathetic.
ReplyDeleteSDL
Chris,
ReplyDeleteBerthold Reimers has an Executive MBA in Management (I believe) from Baruch. Baruch only required one semester of accounting for an MBA- at that time.
If I am correct Berthold Reimers served on the WBAI LSB as a member of the Steve Brown Group.
Ed Manfredonia
Chris: Ignore if duplicate post: My sense is they just don't have anyone to replace Reimers so they go with the devil they know. As hard as it is to believe, Reimers does have some support so maybe they just don't want to deal with it right now. As for the PNB, they need two thirds to remove someone. Its a little bizarre for any group to have board members currently suing them especially a group like Pacifica which is just mired in debt. I heard a while back they had trouble getting insurance due to all the lawsuits.
ReplyDeleteIf Pacifica would rather keep a man, who is destroying the station, as GM in place than looking around the station for someone who has been there awhile and knows the station to replace him, then so be it. I still think Reimers is a pawn in a game of some sort.
DeleteSDL
Keeping Reimers around simply does not make sense unless there is an ulterior motive. I have only met Bill Crosier once and spoken to him twice, but nobody can convince me that there isn't a nefarious game in play. Either Reimers has some kind of a blackmail scheme going or the corruption at Pacifica is far more extensive than I could imagine.
DeleteWhatever it is that keeps a hopelessly inept, unconcerned scam artist in the GM position year after disastrous year, it reeks to high heaven. I have at this point lost the faith I clung to when Bill Crosier entered changing. He is far too intelligent a man to continue believing that Pacifica has not succumbed to its own shameless vandalism and disrespect for honest listener-sponsors.
It seems highly likely, as it has for many years, that Pacifica will be forced to sell WBAI in an attempt to stay alive to further its long-ago redefined political ‘mission’.
ReplyDeleteSo far as is publicly known they’ve not put in place any arrangement for a signal swap or PSOA.
The only thing that matters, really, is that the Shoah Foundation or other angel will see to it that their archives, their past, is digitized and preserved.
Their past is all they have, really, and that’s been clear for more than a few decades.
~ ‘indigopirate’
BAI and Pacifica's debt is like the national debt. You can hide behind all of the in-depth studies, legalese and other word games that you want. You can hide behind the all's well because it just is line of thinking. But that doesn't change the fact the debt will just increase. Why did Crosier take this job? At this point, does it matter? No it doesn't.
ReplyDeleteWhen was the last time you heard corporate media anywhere mention Pacifica in a positive light? If tomorrow Pacifica went out of business, would anybody mention it anywhere? Corporate media wouldn't touch it (unless some major media player were involved). Which means some tiny indep. media site might.
All this and no winners. Being vengeful is not one of my flaws, but I can not hide the fact that I will feel better if the vandals are at least identified and, hopefully made to pay for for what they did.
DeleteWith respect, Chris – can you imagine that actually happening?
Delete~ 'indigo'
No, but I hope that the "M" on their shoulder is as clear as what they did to kill a remarkable broadcast ing experiment.
DeleteCrosier appears to understand that they cannot bullshit their way out of the ESRT lawsuit. However, I doubt that the bozo's at WBAI understand this. Sooner or later, Pacifica will have to lose some of its assets. It will have to sell some assets to raise cash, unless they can find a lender. And, given their track record, no sane lender would give them an unsecured loan. Once they default, any assets put up as security for the loan will be lost through foreclosure.
ReplyDeleteYes to all of that.
DeleteWBAI's stupid on-line petition to the ESRT now has fewer than 800 signers. Assuming that they manage to get to 1,000, and that their signal reaches 20 million people, that means that 0.005% of their potential listeners care enough to sign the petition. Not exactly a huge groundswell of support.
ReplyDeleteWBAI has been dead for several years—genuine mourners will be difficult to find.
DeleteI mourn the WBAI I listened to in the early 1970's.
ReplyDeleteThe more I listen to the current station, the need to pull the plug and let WBAI pass becomes clearer....
You are not alone.
Deletehttps://www1.arbitron.com/sip/displaySip.do?surveyID=FA17&band=fm&callLetter=WBAI
ReplyDeleteNo Fall 2017 Station Information Profile (SIP) on File with Arbitron
120 WALL ST 10TH FLOOR
NEW YORK, NY 10005
Phone: 347-529-6412
Question: Is anyone familiar with aspects of the contract with ESRT which would apply if Pacifica were simply to sell WBAI?
ReplyDeleteParticularly, might there be provision for that eventuality freeing them from the remaining term and obligations of their contract?
~ 'indigo'
I still think WBAI is on some sort of selling block, whether the license, lease time, etc. The question is who will get to rob the proceeds. I think that is one reason nobody really cares to do anything to revamp the programming. The station as we know it is going bye bye, so why bother.
ReplyDeleteSDL
Agreed.
DeleteI was simply wondering if such a provision existed, which it might, directly or indirectly, it would incentivize Pacifica as a whole, ie, the other stations, to want to simply sell WBAI in a clean sale, and not bother with any attempt at a lease arrangement or PSOA.
They had an excellent offer for a PSOA from FMA a few years ago when Summer Reese was trying to find some path to financial survival, but everyone fought it, and she was forced out.
The more the other stations and their votes can dream of the sale of WBAI’s license saving them, the more likely it becomes, of course.
~ ‘indigo’
I am reminded of the scene in "The Maltese Falcon" where Sam Spade says that they need a fall-guy, and all eyes turn to Wilmer.
DeleteA fine point.
DeleteNow if only Reimers et cie might meet the same end as Elisha Cook's character in Shane...
~ 'indigopirate'
So is 7 or 8 million of debt that Pacifica has accumulated over the years? That's a pretty wide swing
ReplyDeleteIf you only have $1.00 in the bank, it does not matter whether your outstanding debt is 7 or 8 million. Either alternative means bankruptcy.
DeleteYou do not understand chapter 11.
DeleteThis is a big test for leftist activism in general. The future looks bleak for coalitional politics. No one believes in the radical democratic mission anymore.
ReplyDeleteThis is big test for competence. Competent managers who will improve programming and outreach. A nice start would be answering the phone or responding to emails from listeners. How about negotiating with ESRT instead of calling them names? How about not criticizing WBAI on WBAI's own air? Is it really necessary to talb about the phone line issue on the air?
ReplyDeleteCompetent managers either know how to fix the issues themselves, or know when they can't & bring in the resources (equipment or people) to resolve the issue.
ReplyDeleteNot the case with WBAI....
Can Ryan even solder? What class FCC license does he have, if they even issue them anymore.
DeleteSDL
My impression is that he does patch jobs. He also plays up to Reimers, big time, so he focuses on keeping that bland show of his. He also, I firmly believe, is guilty of making unauthorized copies of commercially issued recordings to sell as "premiums."
DeleteWBAI is a shameless nest of thieves.
Anyone going to the hearing tomorrow??
ReplyDeleteTo hear the bozos whine? I think not.
DeleteManagement and leadership incompetence over many years. Lack of cohesion and civil environment. Massive mounting debt over years that Board(s) did not address. Flat or declining revenue and audience share that questions the Pacific brand, buzz, legacy and burden, corporate structure, business model, decision making process, and of finding skilled objective people to lead. Flat or growing expenses and liabilities. Pacifica's debt now easily over $8M. BAI & PFW also with heavy deficits. Pacifica et al needs to recast itself. Change it up! Evolve or die! And hire some really savvy managers and accept only realists who will boost revenues as board members.
ReplyDelete