The priorities of the Pacifica national office - in addition to the day-to-day management of network operations -- have been to:

1) Get a clear handle on the network's financial situation and to stabilize economically. 2) Begin the healing and rebuilding process in each of the five signal areas as mandated by the December legal settlement and recent board resolutions. This includes the urgent need for reconciliation between Local Advisory Board's and local stations in the run-up to LAB elections and by-law changes.

The Pacifica Radio network is in far worse financial shape than any of us have imagined. Let me be very clear: Pacifica has been - and remains - on the brink of financial collapse. Every day at the national office, and at our five stations, staff are dealing with vendors and creditors banging on our doors. We are living hand to mouth, figuring out how to meet payroll and keep the network running for another day. Whether it is a phone bill or a transmitter problem or an angry law firm, we have been thrown into crisis management and will remain so for some time to come.

As you all know, the new board and administration inherited a network that faced a $1.5 million budget gap for this calendar year and a $5 million working capital deficit.

In addition, Pacifica's national offices, and its professional relations, were in chaos. Our institutional capacity to handle day-to-day operations let alone a full blown crisis were - and are - extremely limited. While an interim comptroller was hired, and an independent review of the books was conducted, there are no formal accounting procedures and policies in place, and basic systems - like our accounting software -- are not functioning properly. To be sure, strengthening Pacifica's financial spine is one of our top priorities over the coming months.

Despite these difficulties, we are moving aggressively to tackle the problems and we've adopted a three-pronged strategy to address what I am calling "Pacifica's Special Period:"

1) Negotiating Existing Debt: Based on the board decision made on the Feb. 15th conference call, we have hired a law firm to bring order and professionalism to the largest legal and professional claims now outstanding. These total about $2 million from some eight professional service firms. (Deputy ED Verna Avery-Brown report.)

2) Cutting Costs: We have taken aggressive steps to balance our budget for this calendar year. We closed down the network news operations on Feb. 15 and reorganized the Ku satellite system. (Calendar year 2002 savings from cuts is estimated at $900,000). We have also cut back sharply on salaries for national management and general managers. In fact, salary cuts for top managers have ranged from 32 percent to ten and five percent. Overall, the focus of our cuts have been at the national level. Our local stations are the heart of the network and we will do all we can to preserve them.

3) Raise revenue: I am happy to announce that in the wake of December's legal settlement, and the dropping of the listener boycott by community groups across the country, Pacifica Radio posted its highest ever winter fundraising drive in history, generating nearly $3 million in on air pledges at four stations. Listeners at WBAI in the New York tri-state area led the surge, doubling the amount given during last year's winter drive. Both KPFA and KPFK hit a historic high fundraising marks. And during its programming time slot, Democracy Now! raised an incredible $630,000.

All five stations participated in a historic one day nationwide solidarity drive to help repair KPFK's transmitter, which is presently at reduced power. That raised $180,000 in on-air pledges and generated a day of riveting national programming. The response was so positive that we will be doing some more programming of this kind in the near future.

In the meantime, we will be launching a comprehensive fundraising campaign that will include direct mail drops, the targeting of high donors, national on-air fundraising, and special events. We are also looking at ways we can leverage Pacifica's real estate assets.

But the reality is that even with this record fund drive, Pacifica must still raise $1.5 million between now and May 15th just to cover operational costs and salaries across the network. And between May 15th and October 15th, we will have to raise another $2 million in addition to our normal on-air drives.

So how do we Save Pacifica?

Everybody in the Pacifica community - on their own initiative -- must become a fundraiser - every LAB member, every National Board member, every Pacifica worker and listener. Today, this task must be the No. 1 priority of all of us associated with the network. Save Pacifica Committees - or Save our Station committees - can be created throughout the country and every listener can be urged to become an organizer and recruit five or ten new members. We need to organize in the streets, at community meetings, in churches, in trade unions. We can and must organize huge fundraising events in New York, California, Texas, and Washington, DC, and bring in name musicians and speakers. The same mass movement that has brought the promise of democracy to the network can save the network by independently raising hundreds of thousands of dollars in a few short months.

This strategy relies on our greatest strength -- the thousands of loyal Pacifica listeners and the spirit of solidarity and volunteerism that has shaped this network for more than 50-years. It mobilizes people into action, it forces us to organize and expand the base of our membership, and it simultaneously paves the way for a greater voter base in the democratic elections of advisory boards that must be accomplished within the next year.

One important way to mobilize listeners at the level would be through a mass education campaign where we explain, in detail, exactly how Pacifica got into this mess in the first place. As the independent financial review of Pacifica's books revealed, the previous Pacifica administration went on a reckless and irresponsible six million dollar spending spree in a 15 month period. And not just because of the exorbitant fees paid to and charged by legal firms. Senior Pacifica managers treated the network like a trough.

In the first six months of 2001, for instance, one top manager racked up an American Express bill of nearly $120,000 on travel expenses alone. And on their way out the door, these managers handed out exorbitant golden parachute severance packages to themselves and their staff without any regard to professional standards.

Upon leaving Pacifica, one former executive charged up huge hotel bills and absconded with a rental car, saddling the network with thousands of dollars in bills. We had to call the police and report the car stolen to get it back. And to this day, some former officials believe the gravy train is still flowing and they continue to demand huge sums, like more than $100,000, to leave and/or not file lawsuits. In total, some 20 severance payments were handed out over the last year at an expense of nearly $500,000 to the network. We believe these were improper and they have been halted pending a review and renegotiation.

These kind of payments are part of the reckless and uncontrolled spending that occurred over the last year. One firm, for instance, has billed Pacifica more than $500,000 for a few months work. Most alarmingly, I also want to report to you and the entire Pacifica community that the former administration apparently committed hundreds of thousands of listener dollars on an undercover intelligence operation targeting Pacifica staffers and listeners. Secret dossiers were apparently created on programmers, like Amy Goodman, on board members like Leslie Cagan, and on listener activists. Undercover agents were reportedly despatched to spy on Local Advisory Board meetings and on community events. Internet newsgroups and web sites were closely monitored and liaisons were established with local police forces.

It is imperative that some kind of independent review of the files from the last two years be conducted - a kind of Truth Commission, if you will -- to ascertain what exactly happened and why. At the very least, there must be some review of what appears to be an extensive surveillance operation and appropriate steps must be taken to properly handle the information gathered from such undercover activities. Our challenge is to figure out how to learn from the problems and weaknesses of the past so we can develop new safeguarding mechanisms, as well as new governance structures and new commitments to mission-driven programming. And also, if we are asking for on-going financial support from our listeners, we need to be completely transparent with the wider Pacifica community about why.

You will be hearing more about what is happening at Pacifica's five stations tomorrow. But one key development we have prioritized at the national level has been the reintegration of the Local Advisory Boards at KPFK, KPFT, WBAI, and WPFW. This process has raised a series of key questions on by-law changes and upcoming LAB elections.

Another key issue that has emerged during this period of healing and reconciliation has been programming. How do local Pacifica stations articulate Pacifica's mission in their day-to-day programming? What are the structures and processes around programming? There is widespread debate - often sharp -- on the nature of community radio in the 21st century and indeed on the very purpose and direction of Pacifica programming. We welcome that debate and now is precisely the time to organize a national discussion on the issue.

As a result, Verna and I are setting up a commission to look at Pacifica both programming and the programming process, what we are calling a Mission Commission. The Commission will be empowered to organize a network-wide discussion on structure and programming within the Pacifica community and those who are rooted in progressive social movements and in community radio nationwide. We believe the ideas generated by this process will help encourage, focus, inform and strengthen the general debate on Pacifica's future as well as providing concrete programming ideas for the network as we move forward in this new democratic era.

Verna and I have asked long-time programmer and former Pacifica Board member Robbie Osman to coordinate this effort in an unpaid capacity. We have asked him to establish panels of respected progressive organizers and activists to report to the LABs, the National Board, the station staff, and the national office on these questions facing Pacifica.

We hope that out of this period of crisis and upheaval within Pacifica we will be able to salvage a unique opportunity to take a careful look at how our institutional culture and our decision-making structure affect how successfully our programming serves the network's mission.

In terms of day-to day operations at the network we are all working hard to reestablish critical network functions. The KPFK transmitter work on Mt. Wilson is a top priority for this administration. Our best estimate - after hearing from Southern California Edison and Los Angeles County -- is that KPFK will be at low power until mid-May, and even perhaps June. The FCC will be asked for a third extension to allow this work to be completed. Since the delays were out of our immediate control, it will likely be no problem obtaining another extension on our special temporary operating authority. A full technical report will be made available to you this weekend.

Another key area of operations that this new administration has moved quickly to reestablish are Pacifica's sub-carrier licenses. I regret to report that between June and December 2001, no revenue was generated from Pacifica's 10 sub-carrier frequencies at our five stations. As far as we can tell, contracts were just sitting around the national office unsigned. We have already got five leases fully activated, in what is a weak SCA market, bringing in some $35,000 a month. Fully leased, we expect a revenue of about $900,000 a year.

I'm also pleased to report that Pacifica's affiliate stations are returning, largely due to the legal settlement and the return of Democracy Now! A total of 51 affiliates still remain with the network and we are very pleased that many have been spontaneously sending in checks and renewing their affiliation.

As these examples show, Pacifica is coming back. Staff, community, and board members are pulling together to bring this network into a new and historic period in the US media - the first national broadcast network to be democratically run. This is an exciting time and it was best exemplified by the Save Our Signal day of solidarity with the Southern California and KPFK listener community.

But we cannot make these internal changes without actively engaging in the world around us. Today, on International Working Women's Day, 64 people were killed in Israel and the Occupied Territories. Not only does this underscore the urgent need for this radio network to redouble its commitment to peace and social justice programming. But it also reminds us that for Pacifica to be able to successfully change internally, we must actively engage with the historical events and processes and debates that are shaping the world today.

Thank-you.
Dan Coughlin