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Alternative WBAI FY05 Budget Suggestions
9-13-03


[ A post from PNB Finance Committee chair Mark Roberts and response from WBAI treasurer Paul Surovell added below Spooner chart ]

-----------------

From: Carol Spooner [Pacifica National Board]
Sent: Monday, September 13, 2004 6:40 PM
Subject: WBAI Budget

[Budget grid chart below]

I hope we can solve this painful problem without any more grandstanding or shooting the messenger.

I don't think it is debatable that WBAI's on-air fundraising is in a tailspin & has been for a year.

I also don't think it is debatable that the station cannot continue doing on-air drives for 92 days per year without continuing to see its $$ raised per day decrease to the vanishing point.

Whether or not Steve Brown's estimates of on-air funds raised per day are precisely accurate (and we need accurate figures from the station management for the last 5 fund drives ASAP) it is true that the average raised/day dropped this year like a stone from last year and previous years. We really need accurate numbers for each fund drive -- right away -- both for amounts pledged per day, and the actual fulfillment rate for each drive this past year.

The solution to this problem has serious repercussions, not just for WBAI, but also for all the national divisions -- which depend on Central Services at 20% of listener support from each station for their budgets. If WBAI projects listener support that it can't raise, then the national office/programming/archives will also have serious problems meeting payrolls and other obligations. Whether or not the other stations will have the ability to make up the difference is very questionable, since everyone is operating on tight budgets & having trouble coming up with their 1-month operating reserves this year.

We tried to face this problem last fall when the WBAI October '03 fund drive fell seriously short. Unfortunately the main "solution" to the problem -- more days of on-air fund drives -- masked the problem and actually made it worse over the course of the year. We could see that WBAI was meeting its budgeted fundraising goals, but could not easily see the downward spiral in $$s raised per day, because those figures aren't part of our current regular financial reporting system. This information should be reported regularly for all stations to the finance committee from now on, including the pledged amount & fulfillment rate for each fund drive.

Before wading into this with my suggestions, I took a hard look at the historical facts & trends. I've attached a spreadsheet showing the actual audited figures from 2000 through 2003, the '04 budgeted figures, the '04 actual figures (as projected in the 7/31/04 income statement), the '05 proposed budget (9/9/04 version) -- and a revised proposal budget, based on the following: limiting on-air fundraising to a maximum 50 days

  • a 24.7% decrease in projected listener support (from $2,775,000 to $2,089,0000),
  • an overall 24% decrease in total income (from $4,028,840 to $3,062840)
  • a 24% decrease in salaries and related, including consultants (from $1,533,766 to $1165,646). To the greatest extent possible these cuts should be made in non-union staff
  • a 26.8% decrease in other expenses (from $1,574,104 to $1,152,411)
  • a 24.7% decrease in Central Services (from $555,000 to $417,800)
  • a 25.3% decrease in the Cash & Capital budget -- including budgeting one month's operating reserve as part of the cash and capital budget, i.e., NOT showing that as a misleading "surplus" (from $391,939 to $293,988)
  • a 25.3% decrease in the required one month's operating reserve (from $305,239 to $227,988) -- and including the operating reserve in the cash & capital budget rather than showing it as a misleading "surplus".
  • a $58,964 change in the bottom line -- from a $25,969 deficit to a $32,995 surplus (after including the 1-month operating reserve in the cash budget)
Reviewing prior year's audits shows average $/support per day of $59,638 in 2003 in FULFILLED pledges (including categories reported in the audit as "listener support" "donations" "corporate match" "web site" & "major donors". The auditor doesn't break these categories out as we do in our budgets, and I think it would be helpful if he would do so in the future.) That average dropped to $34,214 per day in FULFILLED pledges (projected) in 2004.

The primary goal for the '05 fiscal year would be to raise that back up to $45,000/day in 50 days of on-air fundraising. (And to raise it back up to $60k over the following two years.) Here are some suggestions on how to do that:

  • Return Gary Null to fundraising for WBAI. His fundraising capacity is proven. If he is not permitted to return to fundraising, then prepare to lay off more workers at WBAI. (Disclaimer: My personal opinion is that Gary Null does not belong on Pacifica Radio because I think his is a commercial profit-making venture. However, many others strongly disagree with me. And since the program does air on WBAI, Gary Null should be required to fund raise on WBAI.)
  • Hire a Development Director who is experienced in planning, supervising and executing community radio fund drives ASAP. If this means bringing Phil Osegueda to WBAI for awhile until the right person can be found, then maybe that's what should be done. (I've put $60,000 in the budget for this under consultants -- this should probably be a salaried position, but someone needs to get in there fast who knows what s/he is doing.)
  • Analyze each regular and special program for its fundraising totals per hour (both pledged and fulfilled) and make some adjustments in the schedule taking fundraising into account. (Obviously, fundraising is not the SOLE measure of a program's value to the station or in fulfilling the mission -- but this must be considered.)
  • The Station Manager needs to go on the air several times to report to the listeners that the station will be cutting back its fundraising days from 92 to 50 days this year -- and to explain what the problem is and ask for their support in making this plan a success. He should also explain this in his weekly email bulletins to the listeners. People are more likely to respond positively if you level with them. There are a lot of people who care deeply about WBAI.

Other suggestions:

  • Emphasize VOLUNTEERS in the tally room and during the fund drives. And the station manager should go on the air to generate excitement for this "support WBAI" volunteer time. Make the station friendly to volunteers. Use LSB fundraising committee members to help with this, as well.
  • The LSB definitely should form a fundraising committee -- to work as volunteers under the supervision of the Development Director on Community Events and other fundraising projects. The Development Director should be put in charge of working collaboratively with the LSB fundraising committee (including as many volunteers as they can round up) in devising plans and executing them. I've set the total goal for Community Events fundraising at $50k in my proposed revised budget. I've increased the Community Events expense category to support this effort. I think that if people will stop fighting each other they can succeed, and if they don't stop fighting each other they probably won't succeed. (I've also attached an article on ways for boards to raise money -- obviously, not all of them are appropriate, but some of them certainly are & I'm sure there are a lot of other good ideas around.)

I've gone through the budget line-by-line looking at this year's projected actual expenses vs next year's budget and suggested cuts wherever it looked possible to me (though probably painful). Those on the ground at WBAI may find other places to make cuts, or places where I've suggested cuts that just can't be made. This will require a lot of discipline, and the finance committee should monitor it like a hawk this coming year and not let anything slide.

Some final thoughts about salary cuts. Salaries and related expenses at WBAI have increased by 35% -- almost $400k -- since FYE 9/30/01 (since the settlement with the old board) -- from $1,138,038 in FYE '01 to $1,536,041 projected for FYE '04. This 35% increase took place without solidifying sustainable income growth to support it. I think there were many reasons for this -- not the least of which was some euphoria at ridding the network of the old repressive regime, and a feeling of entitlement to "splurge" and reward our friends, as well as fill some vacancies that may have really been needed. Big increases in salaries & benes also occurred at KPFA & KPFK -- but both of those stations have more "wiggle room" because they own their buildings and don't pay the exorbitant rent that WBAI pays (both for its Wall Street offices and for its tower at the Empire State Building) -- and both of those stations have so far been able to sustain the income growth to support it, though I really do worry about KPFA. Another reason is probably the loss of institutional memory in the person of Pacifica's long-time controller for 18 years -- Sandra Rosas -- who was fired by Bessie Wash in early 2001. Sandra was a fiscal conservative, and she enforced prudent spending policies based on "proven income." Needless to say, she was controversial. Nobody likes a "bean counter." But we need to learn from this experience at WBAI and institute better controls on expense over-runs.

It is counter-productive and unfair to charge anyone with being "anti-worker" because WBAI's income shortage requires staff cuts. I hope that everyone -- particularly the station and national management -- will be sensitive & not use this situation to further inflame partisan passions.

--Carol

WBAI FINANCIAL RECOVERY AND RESPONSIBILITY PLAN FOR FYE 9/30/06

[ Proposed WBAI FYO5 budget present to the LSB 9-9-04:
http://www.wbai.org/lsb/index.php?option=content&task=view&id=2854&Itemid=28 ]

Item 00 Actual

Audited

01 Actual

Audited

02 Actual

Audited

03 Actual

Audited

04 Budget 04 Projection

(per July 31 Income Statement)

05 budget

Proposed 9/9/04

Revised Proposed

05 budget

Proposed Cuts % Cut

INCOME

                   
Listener Support         2,500,000 2,929,611 2,775,000 2,089,000 686,000 24.7%
Donations         0 43,152     0 N/A
Corporate Match         11,000 9,511 11,000 11,000 0 0.0%
Web Site

(include in listener support)

        90,372 0 100,000   100,000 100.0%
Major Donors         150,000 165,405 250,000 150,000 100,000 40.0%
SUB-TOTAL

Listener Support Donations

2,432,045 2,201,041 2,434,892 2,981,919 2,751,372 3,147,679 3,136,000 2,250,000 886,000 28.3%
#Days on-air fund drives (approx) 45 45 45 50   92 92 50 42 45.7%
Average support/day 54,045 48,912 54,109 59,638   34,214 34,087 45,000 (10,913) _32.0%
Grants         30,000 10,690 60,000 60,000 0 0.0%
Grants - CPB         391,020 391,019 489,840 489,840 0 0.0%
Grants - Non-operating         0 9,397     0 N/A
SUB-TOTAL

Grants

485,151 486,966 445,587 577,797 421,020 411,106 549,840 549,840 0 0.0%
Community Events         50,000 17,908 50,000 25,000 25,000 50.0%
Community Events - LSB

(C/E should be combined under supervision of Dev Dir.)

            50,000 25,000 25,000 50.0%
Community Events (R)         228,000 184,967 200,000 185,000 15,000 7.5%
SUB-TOTAL

Community Events

214,615 145,890 136,990 229,300 278,000 202,875 300,000 235,000 65,000 21.7%
Interest/Other 9,274 9,345 2,954 500 3,000 43,103 3,000 3,000 0 0.0%
Web Radio Income

(Should be national income)

            25,000 0 25,000 100.0%
Folio Income         0 28,360 5,000 25,000 (20,000) _400.0%
SUB-TOTAL

Other Income

9,274 9,345 2,954 500 3,000 71,463 33,000 28,000 5,000 15.2%
SCA Income 2,000     0 10,000 0 10,000 0 10,000 100.0%
TOTAL INCOME 3,143,085 2,843,242 3,020,423 3,789,516 3,463,392 3,833,123 4,028,840 3,062,840 966,000 24.0%

EXPENSES

                   

Salaries & Related Expense

                   
Gross Salaries   886,745 1,002,219 1,120,622 775,230 1,129,845 1,200,330 863,096 337,234 28.1%
FICA   77,103 87,968 115,064 59,308 86,433 91,825 66,022 25,803 28.1%
SUI         25,583 27,412 39,611 28,480 11,131 28.1%
Pension Plan         6,000 1,500 6,000 4,314 1,686 28.1%
Health Benes   124,662 112,088 134,747 176,400 183,276 108,000 77,652 30,348 28.1%
AFTRA 13%             78,000 56,082 21,918 28.1%
Child Care         0 1,571 0 0 0 N/A
SUB-TOTAL

Salaries & Benes

  1,088,510 1,202,275 1,370,433 1,042,521 1,430,037 1,523,766 1,095,646 428,120 28.1%
Consultants

(includes Development in 05 revised budget)

  49,528 74,714 107,946 30,000 106,004 10,000 70,000 (60,000) _600.0%
TOTAL

Salaries & Related

1,061,800 1,138,038 1,276,989 1,478,379 1,072,521 1,536,041 1,533,766 1,165,646 368,120 24.0%
OTHER EXPENSES                    

Administrative Expenses

                   
Telephone         109,200 93,383 72,000 72,000 0 0.0%
Cellular Telephones             7,200 7,200 0 0.0%
Tele - radio lines         10,500 8,851 9,900 9,000 900 9.1%
Postage         0 0 6,000   6,000 100.0%
Postage- Messenger         11,700 4,100 5,700 4,500 1,200 21.1%
Assoc & Periodicals         4,100 4,542 4,020 4,000 20 0.5%
Prof Serv - Legal         12,000 6,509 6,000 6,000 0 0.0%
Bank Charges         21,600 13,891 9,600 10,500 (900) _9.4%
Conf/Training         10,800 7,450 10,800 7,500 3,300 30.6%
Insurance                    
Travel         1,950 10,268 6,000 6,000 0 0.0%
Local Travel         2,400 31 900 100 800 88.9%
Travel Nat'l Board         8,300 318 8,300 4,000 4,300 51.8%
Local Board Exp         1,200 4,156 6,000 6,000 0 0.0%
LSB Elections         0 60,074 45,000 40,000 5,000 11.1%
Office Expenses         22,200 7,124 7,200 7,000 200 2.8%
Office Rental         254,928 282,063 278,928 278,928 0 0.0%
Tower Rent:ESB         219,996 236,719 254,796 254,796 0 0.0%
Tower Rent: Antenna             24,660 24,660 0 0.0%
Rent & Lease Equipment         8,400 3,174 8,400 3,200 5,200 61.9%
Utilities         38,400 35,599 54,000 36,000 18,000 33.3%
Maintenance - non-technical         8,400 13,675 10,000 13,500 (3,500) _35.0%
Other Admin         18,682 6,647 0 6,600 (6,600) ??
Search Cost         2,300 0 2,300 1,000 1,300 56.5%
Computer Maintenance         12,000 6,458 12,000 6,500 5,500 45.8%
TOTAL

Administrative Expenses

        779,056 805,032 849,704 808,984 40,720 4.8%

Programming Expenses

                   
News Service         33,600 26,311 26,400 26,400 0 0.0%
News Dept         6,000 46   0 0 N/A
News Dept Travel             3,600 2,000 1,600 44.4%
Supplies Wire Machines         3,600 0 2,400 0 2,400 100.0%
Satellite Fee         5,800 17,370 7,000 17,370 (10,370) _148.1%
Maintenance Technical         7,200 21,619 18,000 18,000 0 0.0%
Maintenance Engineer         3,600 7,297 7,200 7,200 0 0.0%
Prerecorded material         2,100 0 2,100 0 2,100 100.0%
Programming Services         1,500 21,484 2,000 2,000 0 0.0%
Website expenses         47,049 34,623 36,000 35,000 1,000 2.8%
Digital Web Radio Studio

(Should be National Expense)

            15,000 0 15,000 100.0%
Tapes & supplies         21,600 21,138 18,000 18,000 0 0.0%
Other Programming         7,200 9,806 7,200 7,200 0 0.0%
MKTG/Promo         10,000 23,755     0 N/A
MKT/Promo Postage         8,336 0     0 N/8
NPPAG (FSRN)

(Should be 27% of CPB Grant)

        109,306 89,940 113,000 132,257 (19,257) _17.0%
Folio Printing             30,000 30,000 0 0.0%
TOTAL

Programming Expenses

        266,891 273,389 287,900 295,427 (7,527) _2.6%

Development Expenses

                0 ??
Printing-Marketing         2,000 0 2,000 0 2,000 100.0%
Printing Subscriptions         24,000 14,519 15,000 15,000 0 0.0%
Fundraising Travel         1,100 0 1,100 0 1,100 100.0%
Development - Consultant (should be moved to salaries & related)             60,000 0 60,000 100.0%
Develop. Expenses         0 4,121   2,000 (2,000) ??
Subs Services         0 1,446   1,446 (1,446) ??
Postage Subs         19,200 7,044 8,100 7,050 1,050 13.0%
Mailing Svs Subs         12,000 19,237 12,000 19,237 (7,237) _60.3%
Subs - Postage Due             3,000 0 3,000 100.0%
Postage Development         3,103 5,919   6,000 (6,000) ??
Subscription supplies         9,000 9,691 9,000 9,000 0 0.0%
Computer supplies         6,000 238 6,000 500 5,500 91.7%
Premiums         200,000 202,208 175,000 175,000 0 0.0%
Marathon Exp         10,000 18,331 20,000 10,000 10,000 50.0%
Premiums- shipping         28,000 12,033 18,000 12,000 6,000 33.3%
Advertising & Promo         3,000 6,395 3,600 5,000 (1,400) _38.9%
Marketing & cataloguing         1,800 0 1,800 0 1,800 100.0%
Direct Mail - Printing         35,000 5,625 13,500 6,000 7,500 55.6%
Direct Mail - postage         22,000 2,917 20,000 3,000 17,000 85.0%
Caging - direct mail         0 0     0 N/A
Other Development         10,000 2,952 9,600 3,000 6,600 68.8%
Major Gifts Expense         7,200 0 7,200 0 7,200 100.0%
TOTAL

Development Expenses

        393,403 312,676 384,900   384,900 100.0%

Community Events

                   
Special Events - Rothenberg         41,000 41,744 45,600 42,000 3,600 7.9%
Community Events         10,524 1,220 6,000 6,000 0 0.0%
TOTAL C/E         51,524 42,964 51,600 48,000 3,600 7.0%
TOTAL

Other Expenses

(Before Depreciation)

1,382,262 1,406,027 1,181,190 1,457,376 1,490,874 1,434,061 1,574,104 1,152,411 421,693 26.8%
TOTAL Expenses

(Before Depreciation)

2,444,062 2,544,065 2,458,179 2,935,755 2,563,395 2,970,102 3,107,870 2,318,057 789,813 25.4%
Central Services

(Should be 20% of Listener Support)

572,152 563,007 616,904 585,033 500,002 588,118 555,000 417,800 137,200 24.7%
TOTAL Expenses & Central Services 3,016,214 3,107,072 3,075,083 3,520,788 3,063,397 3,558,220 3,662,870 2,735,857 927,013 25.3%
EXCESS Operating Income (Expense) 126,871 (263,830) (54,660) 268,728 399,995 274,903 365,970 326,983 38,987 10.7%
CAPITAL & CASH BUDGET                    
Legal Assessments         125,004 125,000 50,000 50,000 0 0.0%
Computer Equipment         8,000 895 8,000 1,000 7,000 87.5%
Capital Improvements         10,000 0 10,000   10,000 100.0%
Transmitter/Tech studio         3,700 0 3,700   3,700 100.0%
Equipment Reserve         0 26,059 15,000 15,000 0 0.0%
One Month's Operating Reserve (Should be budgeted rather than shown as "surplus")         255,283 296,518 305,239 227,988 77,251 25.3%
Total Cash/Capital Budget         401,987 448,472 391,939 293,988 97,951 312.8%
Surplus (Deficit)         (1,992) (173,569) (25,969) 32,995 N/A N/A


From: Mark Roberts
Sent: Monday, September 13, 2004 7:57 PM
Subject: KEEP WBAI ALIVE--GONNA TRY TO SEND THIS AGAIN

Greetings to all,

I have read many emails regarding WBAI over the last few months with great interest, concern, and hope. To be honest, with respect to the proposed FY '05 budget, I think both primary sides make valid points, but also err. Those arguing for budgetary restraints are correct in highlighting past fundraising difficulties, donor fatigue, and associated expenses, but need to also consider the affect of severe reductions on the station and its considerable supporters, legacy, and promise. Those seeking to rely on new and proposed revenue enhancements and cost efficiencies are right to remain optimistic, but must also recognize the legitimacy of present concerns. So, how to proceed?

Excessive on-air fundraising days and reduced fulfillment rates are issues that will not go away, nor should they. However, the underlying presumption that WBAI is bleeding more affluent, white listeners in favor of less engaged "community folk" is also problematic and troubling. The interjection of race and class always muddies the waters. At times, it almost seems as though bad news becomes good news to those seeking a different direction in BAI programming and perceived identity.

Those who base their fiscal arguments solely on a Pacifica mission statement rooted in amplifying the "voiceless" seem to ignore the financial risks of a budget fueled solely by parochial intent. The left, almost by definition, is a loose collaboration of interests not always aligned. Intellectual monogamy is the hallmark of the right. On "our" side, we must work hard to tolerate our differences in the interest of our commonalties. Unfortunately, the question of whether BAI is "too black" or should be "more white" ignores the deeper issues of how to remain vibrant, solvent, and relevant in one of the world's largest and most diverse markets.

I am not a deep believer in the relevance of Arbitron data to community radio--especially one as historic and influential as ours--and I find comparisons to NPR harmful. This is Pacifica. "Bling" and star power are not our aim. Peace, Justice, Access, and Understanding are more on the mark. How to reconcile both? To me, that is a more relevant question than what Gary Null does, or Bernard White doesn't. And I must reveal that my underlying assumption is that all parties want BAI to live and breath and thrive. But how?

Forgive my arrogance, but I suggest six things from my engaged, albeit remote, office here in DC, as follows:

1) I would acknowledge that the budget, crafted by competent professionals and volunteers at BAI, is a collaborative blue print--a PLAN of attack. We need to move away from calling out names, assigning blame, or attacking personal investments. The GM, the BM, the Treasurer, the LSB--ALL want what they perceive is best for the station they love. Let's move away from character assassination and towards character development--on all sides;

2) I would consider a contingency plan for now. Pass the annual budget on a three month basis with a motion to revisit in time to revise by January if any underlying assumptions prove significantly false in either direction--yielding more or less than anticipated;

3) Place a six-month moratorium of any and all consultant hirings. Rely on the current paid staff and more volunteers to work the vision through. This ban would help alleviate the concern that WBAI has become a revenue source for individuals rather than the common good;

4) Reduce projected revenue for FY '05 by 12%. While the number appears arbitrary, it is not and seeks to acknowledge the current fundraising difficulties, while also managing a reasonable downsizing that incorporates both reinvigorating funding and development goals and recognizing staffing implications.

WBAI would also need to reduce expenses in the proposed budget by 12% in order to maintain mandated, national working capital requirements. I am not as familiar with the budget as those at WBAI are, but I have reviewed it, and I would look at administrative, premium, and mailing costs. Those, together with the reductions in consultant expenses, should accomplish the goal;

5) Stop turning every mole hill into a mountain. It distorts the terrain; and

6) However you wish to proceed, remember how powerful WBAI remains. Too often, when in battle, we all harp continuously about what "us or them" are NOT and fail to celebrate what WE have become. I respect the passion at WBAI. Passion is a great thing, but, at times, needs to be harnessed. Yes, let the vision and the numbers guide you. But lingering negativity and simmering distrust will not breed the optimism, communion, excitement, and creativity needed to overtake this impasse. A little more sunshine could work wonders. Please remember how much all of us are counting on you, your goodness, and your ideas to make a way.

Mark Roberts, Chair
National Finance Committee


From: Paul Surovell [WBAI LSB Treasurer]
Sent: Friday, September 17, 2004 12:22 PM
Subject: Will the Budget Ax Increase or Decrease Daily Fund-Raising at WBAI?

WILL THE BUDGET AX INCREASE
OR DECREASE DAILY FUND-RAISING AT WBAI?

CONTEXT

On September 30, 2004, the end of Fiscal Year 2004, WBAI have at least $150,000 in the bank, more than enough take us into the October Fund-Drive, according to Business Manager Indra Hart's most recent cashflow analysis.

PROPOSALS FOR BUDGET CUTS AT WBAI

The issue of the daily rate of WBAI's fund-raising -- as opposed to how much WBAI is raising -- was presented as the primary reason why 7 LSB members voted to reject the WBAI budget presented by Business Manager Indra Hardat, GM Don Rojas and LSB Treasurer Paul Surovell. In the same vote 6 members voted to approve and 3 members abstained.

In response to this concern about the daily rate of fund-raising at WBAI, two members of the National Finance Committee, Mark Roberts and Carol Spooner, have called for cuts in WBAI's budget as part of their recommendations to improve WBAI's daily rate of on-air fund-raising.

Mark recommends a 12% overall cut in the budget. Carol recommends a 24.5% overall cut, including a 28.1% cut in the paid staff, part-time and temporary employees. [This is on top of a $65,000 cut (37%) in nonstaff part-time and temporary employees included in the budget proposed by the WBAI Business Manager, GM and LSB Treasurer.]

Mark's proposal would cut spending and income by $483,460 at WBAI.

Carol's would cut spending and income by $966,000.

In my opinion, neither Mark nor Carol have provided a single reason or rationale, as to why and how budget cuts would help WBAI increase its daily rate of on-air fund-raising. With all due respect, I regard their proposals as gratuitous and irrelevant to the issue on hand.

BUDGET CUTS AT THIS TIME WOULD WORSEN DAILY FUND-RAISING

In fact, I think there is good reason to believe that sharp cuts among the staff -- which has worked so incredibly hard to meet WBAI's fund-raising needs this year -- would cause morale to plummet to such a degree that daily fund-raising rates would actually WORSEN, as would the necessary administrative follow-ups in data-entry, invoicing and premiums.

I asked one of AFTRA's stewards last night how he thought the staff would react to staff cuts at this time of between 12% and 28.1%.

He said he didn't understand the logic of such a proposal that would effectively punish the staff that has been working under duress and far beyond the call of duty, to keep WBAI afloat and up and running, for the past 12 months. He said the idea of budget cuts at this time sounded like a "nightmare" that would probably cause the best people at WBAI to leave.

Unless and until those advocating budget cuts can provide reasons and rationales as to how such cuts will help WBAI increase its daily rate of on-air fund-raising, I think all such proposals should be withdrawn.

THE WBAI BUDGET INCOME LINES

The WBAI budget proposal includes a Listener Support line that is lower by about $154,000 than what is expected to be realized in FYR04, according the the latest projections (July 31, 2004) cited by Carol Spooner. The WBAI budget grid which I prepared that shows a slight increase in Listener Support ($18,435) was based on the May 31, 2004 projection.

The major income increases that are included in the budget are the $98,000 increase in CPB funds, and increases of about $122,000 (donations, community events and grants) that are expected to result from the hiring/contracting of a development director/consultant.

There is also LSB fund-raising of $50,000. The LSB has already raised this year about $40,000 through two projects by LSB member Steve Brown, and there are a number of fund-raising opportunities available right away for the LSB.

What appears as a $100,000 increase for Website Income is not the case, because close to $100,000 will actually be raised by the Website in FYR04, according to station records.

I concede that the budgeted income of $25,000 for the Web Radio project is not based on experience or a specific plan, and perhaps it should be reconsidered.

However, I believe all other income categories are based on experience and/or specific plans. If they are not realized, obviously adjustments and cuts in spending will have to be made, as is always the case.

CONTINGENCY PLANS IF INCOME TARGETS FALL SHORT

WBAI and Pacifica management has on at least 2 occasions in FYR04, indicated in discussions with AFTRA, how management will respond to income shortfalls. In the first instance there were contingencies for layoffs. In the second instance, there was a contingency plan to cut salaries across the board by the amount needed to address the shortfall.

There is a world of difference between a contingency plan for an income shortfall and a proposal for layoffs or salary cuts when income covers expenses.

WHAT SHOULD THE WBAI LSB AND THE PNB DO?

I recommend that the WBAI LSB approve both the proposed budget as well as the accompanying Budget Motion and that the LSB and the PNB Finance Committee keep a close eye on WBAI's financial performance, so that if an income shortfall appears, adjustments, and cuts, if necessary, can be instituted. Cuts under these circumstances will be justified and understood.

The importance of the Budget Motion is that it will:

(1) Establish clear limits on spending on part-time and temporary employees and on consultants.

(2) Require LSB approval of the contract for a development position or consultant

(3) Require LSB approval (under PNB guidelines) for any spending not covered by the budget.

(4) Commit the LSB to work with management to improve on-air fundraising, including the daily rate of on-air fundraising.

(5) Commit the LSB to work with management to improve off-air fundraising.

HOW DO WE RAISE THE DAILY RATE OF FUND-RAISING?

I think the highest priority should be to establish a process between management and the LSB to examine the fund-raising process as a whole.

Such a process, in my view should focus on the following:

a) Establish the facts about fund-raising performance at WBAI.

b) Compare WBAI's experience with that of other stations. Bring in fund-raising managers from other stations to consult with us.

c) Determine how can we improve the management of the fund-raising process.

d) Develop a concrete plan to overcome the huge Premiums backlog.

e) Establish an ongoing outreach / membership campaign headed by the WBAI Outreach Coordinator, involving ongoing leafleting, tabling, speaking and other forms of outreach to encourage the public to listen and join WBAI. Not just at special events, but several times a week, every week.

f) Recognize the imperative to re-broadcast Democracy Now! in the evening, when working people and students can listen, and to consider rescheduling the morning broadcast from 9 am to 8 am.

Making Democracy Now! available to progressive New Yorkers is the single most important step that WBAI can take to improve its audience, its membership and its fund-raising performance. And this can be accomplished without removing a single program from the program schedule.

APPENDIX

REPLIES TO PROPOSALS BY CAROL SPOONER ON FUND-RAISNG

(1) Return Gary Null to fund-raising. REPLY: This has already happened. Gary Null was included in the August fund-drive, and hopefully will be included in all future drives.

(2) Hire a Development Director, perhaps Phil Osequeda. REPLY. This is included in the budget and in the budget motion. Phil was closely involved in the work of our interim Development Director, whose plan for FYR05 will be a key consideration in the hiring process. I agree that Phil should remain closely involved with WBAI as much as possible.

(3) Analyze each program's role in fund-raising. REPLY. Agreed.

(4) Emphasize volunteers in tally. REPLY. This is already the case. The only paid employees are those who supervise the tally volunteers and the transfer of data to the membership department.

(5) Fund-raising by the LSB. REPLY. Agreed

(6) Station manager going on-air to emphasize the need to raise money faster. REPLY. Agreed.


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