CPB has withheld financial support for the Pacifica Foundation’s five radio stations after the organization missed deadlines for fixing errors and shortcomings in its accounting and operations.
The errors were discovered during a CPB audit last year that cited Pacifica for insufficient accounting practices, misreported revenues and failure to comply with CPB rules on open meetings and financial transparency.
The withholding of CPB funding hits Pacifica at a precarious time as its stations struggle to raise enough money to pay rent and staff. WBAI, Pacifica’s New York station, fell short of its on-air fundraising goal in May by 45 percent, or $343,000. The station can’t cover its June payroll or rent for its antenna, according to a June 9 email by Berthold Reimers, g.m., to members of WBAI’s board.
The station will extend its fund drive, wrote Reimers, who added, “This is our only choice until we can figure out other means or else we will have to shut down the station.”
WBAI was also struggling to pay antenna rent in February, and at the time Reimers hoped to draw on $130,000 in Community Service Grant (CSG) support from CPB, which was to be delivered in March. But CPB withheld that money and grants to all other Pacifica stations because it has not received requested documentation from the Berkeley, Calif.–based foundation.
A September 2012 audit by CPB’s Office of the Inspector General found Pacifica in violation of several criteria for receiving CSG payments. The foundation had overstated its nonfederal financial support from October 2008 to September 2010 by about $2 million, which resulted in CPB erroneously awarding Pacifica an excess of $133,240 in CSGs.
The foundation had made the error by improperly valuing some premiums given away during on-air fund drives. It blamed the problem on “new staff members” and errors made by a public accountant. Pacifica recently hired a new chief financial officer.
CPB will adjust Pacifica’s CSG payments in 2014 to recover the excess money previously awarded, according to Michael Levy, executive v.p. of corporate and public affairs. Per station, that amount ranges from $6,910 to $42,732.
The corporation has also withheld a CSG payment scheduled for earlier this year because Pacifica has not provided its Annual Financial Reports or documented that it is properly tracking use of CSG funds. It could still receive those funds if it complies with CPB’s requests, Levy said.
CPB’s audit also found that Pacifica and its stations were failing to comply with Communications Act requirements regarding open meetings, open financial records, and documenting of operating procedures. The funder is awaiting documents proving that Pacifica is addressing those concerns.
Summer Reese, Pacifica’s interim executive director, could not be reached for comment.
Copyright 2013 American University