Christopherson at right, Eakeley at left NJN wants to go nonprofit but keep the same mission and staff and increase services, Christopherson said in a state Senate hearing. At left: foundation chair Eakeley. (Image: NJN.net.)

With its state aid shrinking, NJN asks for independence

Originally published in Current, May 12, 2008
By Steve Behrens

With state officials proposing to cut funding for its public TV and radio network by 35 percent next year, New Jersey Network wants out.

Testifying before a state legislative panel April 30, NJN officials asked lawmakers to let the network morph from a state agency into a freestanding nonprofit licensee, while providing up to $4.3 million a year during a four-year transition. After fiscal 2012, New Jersey would no longer pay the network an annual stipend.

“We’d like a seamless transition, with the same [staff], the same mission, ... increased service, but ... new ways to provide resources,” summarized Elizabeth Christopherson, NJN executive director.

Three members of the Senate budget and appropriations committee said the idea was new to them. “Nobody in the legislature has been brought up to speed on this,” said Sen. Paul Sarlo (D), who presided at the hearing and asked NJN to come back with a more complete proposal.

Christopherson told Current her staff had briefed the legislature’s party leaders, as well as the committee chair, who was absent during the hearing, and the ranking Republican, but has been discussing independence with other stakeholders, including employees.

The state’s Public Broadcasting Authority commissioners haven’t formally voted for independence, she said, but its executive committee supports what she’s doing.

With the state budget under crushing pressure, “there was no way in this fiscal year that we wouldn’t have a reduction,” says Christopherson.

Gov. Jon Corzine (D) has proposed cutting a cool $500 million from the state budget and 3,000 jobs from the payroll for next year.

Corzine “has given us broad conceptual support to pursue alternatives” and propose them, Christopherson told Current.

The governor’s  proposed spending cuts would reduce NJN’s appropriation from $5.9 million this year to $4.3 million in fiscal 2009.The state treasurer proposes additional cuts, bringing NJN’s subsidy down to $3.8 million.

The state’s funding, once as high as two-thirds of NJN’s budget, would drop from 31 percent this year to as low as 20 percent under the treasurer’s plan, according to network officials.

In the meantime, the state has declined to pay for updates of equipment so old that some is rated 50 percent likely to fail within a year, Christopherson said in an interview.  “We have equipment that is so old,” told the legislators, “we have to go on eBay to find the parts.”

“The state has invested in NJN for 40 years,” said the network’s written testimony. “We ask for four more years of support to help us reach the level of productivity that will enable us to thrive in the complex and dynamically competitive television market.”

Going nonprofit is “our only option with an upside potential,” said Douglas Eakeley, chair of the NJN Foundation, the network’s nonprofit fundraising affiliate, which he said would probably become the new licensee. “We don’t have the financing either to meet current operating needs or the capital to meet necessary infrastructure development.”

“We have reached our capacity in fundraising, because it’s a state agency,” Eakeley added, “and nobody is going to contribute to fix a leaky roof when the state owns the building but fails to repair the roof.”

Gaining independence “could open the floodgates for private funding,” according to Ron and Carol LaRose, consultants studying fundraising options for the network. But people simply won’t write sizeable checks as long as the state owns NJN, they found in a round of interviews with potential big donors.

As a result, Ron LaRose said, individuals’ donations to NJN are very low. He knows that several “small colleges with pathetic fundraising have two or three times as much.”

NJN has the advantage of “one of the strongest boards in the state, at least on paper,” which could help with fundraising, LaRose said in an interview, but it has the disadvantage that many viewers, including himself, go to New York’s WNET or Philadelphia’s WHYY to watch PBS programs. NJN long ago decided not to duke it out with the overlapping stations for the PBS audience. Instead, it opts for delayed broadcast of a discount package of national shows.

The network contends it will be nimbler and better at generating revenue and starting new services if it sheds the restrictions that bog down state agencies. For example, it could begin to take advantage of the digitization of its Educational Broadband Service microwave licenses (formerly known as ITFS), to be paid for by private companies under an FCC order, but after two years the state has not given NJN permission to accept the improvements, according to NJN spokeswoman Ronnie Weyl.

Not nearly persuaded

The hearing, as recorded and streamed in NJN’s routine legislative coverage on its website, provides a preview of issues the network may face again. Sens. Kevin O’Toole and Shirley Turner professed to be surprised and were openly suspicious. “Why are you not putting it out for bid to make sure we’re not selling it for a fire-sale price?” asked Turner, a Democrat who called the proposal “privatization.”

“This is not a private company taking over something,” replied Scott Kobler, chair of the state Public Broadcasting Authority, which governs NJN. The commissioners are “civic-minded individuals who have been involved with NJN for many years,” he said.

Union members of NJN’s staff may be the toughest critics of the independence proposal.

“Sentiment among members is running pretty strongly against it,” says Dudley Burge, a staff rep at Local 1032 of the Communications Workers of America, who calls the proposal “a corporate takeover” by an “unrepresentative,” wealthy board.

“Obviously, we have concerns about job security, pensions, benefits and the survival of the organization,” Burge said for quotation in the Newark Star-Ledger.  

CWA represents about 100 of the 150 NJN staff members, and a smaller union has more than 25, Burge said. Union members played a role in stopping an independence proposal last year, he said.

Sen. Turner, who said she had heard complaints from NJN employees, was joined by Leonard Lance, a Republican, in expressing fears that an independent NJN would have to lay off employees who have served the state well.

What NJN fears more, Eakeley replied, is that it will have to lay off employees if it doesn’t leave state ownership.

Kobler assured the legislators that it was a “core value” of NJN to “hold the employees harmless.”

The network’s staff, as large as 219 full-timers two decades ago, has been reduced to 150 by attrition, NJN said, but Christopherson said it has not laid off employees since she took office in 1994.

She brought in the chief execs of Vermont Public Television and Oregon Public Broadcasting to speak with NJN staffers about their networks’ experience breaking with state ownership.

Oregon Public Broadcasting, for example, phased out state operating aid between 1993, when it went nonprofit, and 2003, OPB said.  However, like nonprofit and other licensees in many states, it received special state aid to help convert its major TV transmission system to digital. In 2002, OPB received state grants for DTV totaling $7 million, and last year it got $3 million to switch rural translator stations to digital.

Web page posted May 16, 2008
Copyright 2008 by Current LLC

How much do other states help out?

NJN's shrinking state support has fallen into the lower ranks of states that contribute to public broadcasting.

Kentucky is putting $30.4 million into KET this year, not counting one-time-only costs, and five states pony up $13 million to $19 million — the Carolinas, Georgia, Nebraska and Louisiana, according to figures compiled by National Educational Telecommunications Association.

New York, Pennsylvania and Florida don't even own their stations and they fit that category.

Ten others spend $6 million to $12 million.

Many states put little money into station operations, but of the states that own networks, those spending less than NJN's $5.9 million are much smaller in population, including Idaho and Rhode Island.

 

EARLIER ARTICLES

Maine public broadcasters merge, creating nonprofit network, 1992.

Governor proposes spinoff of Oregon network, 1992.

Hawaii network goes independent of state and Idaho conservatives push to divorce state net (it didn't happen), 2000.

LINKS

In an editorial April 30, the Newark Star-Ledger backs NJN's proposal to go nonprofit.

NJN's April 30 testimony appears toward the end of this video of state budget hearings, after long testimony by the secretary of state.

Cutting off from annual state funding doesn't mean that stations don't get state aid, especially with one-time costs like DTV conversion. Oregon's OPB, for instance, received $10 million for DTV, including $3 million for rural translators this fiscal year.

 

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