Pacifica National Finance Committee (NFC)
meeting notes, 7-29-05
These meeting notes are unofficial.
Official PNB minutes posted at pacifica.org
Audio Archive at www.kpftx.org
These notes paraphrase statements made by attendees at the meeting (two hours). Most was done in one listen, so there may be some inaccuracies. To find out the exact words, listen to the audio at www.kpftx.org
- Written by James Ross, wbai.net contributor
Meeting via teleconference
Updated projections (based on June data) from CFO and end of year variances from budgets at all seven units:
--National office spent unbudgeted $125,000 on direct mailings without board authorization.
adelson -- KPFK PNB, chair
motion to excuse roberts absence -- no objection
GMs invited on call. Campanella is on call
hicks: move report of working group up to #4 move FY 06 budget up to #5
adelson: put review of financials and budget status first cause we need sense of where we are. before we talk about what to do about it.
heffley: need to know what we are talking about first before we talk about getting more money.
gatewood: had specific questions on May financials last time. wants to cover actual may numbers
vote on lonnie agenda amendment
no objection to adoption of original agenda
ELECTION OF PERMANENT CHAIR
adelson: two nominees are adelson and tattersall. they will speak briefly.
tattersall: honored to be nominated, willing to serve. 30 plus years in media business - finance and strategy. records, film and radio. served as comptroller for several radio stations. currently comptroller of radio station in San Francisco. MBA from Harvard. enjoys serving Pacifica in financial capacity. wants to use time well at NFC. priority to pass FY06 budget and monitor. in particular variance analysis of NO and PRA but also other stations, find solutions to fundraising difficulties.
adelson: 10 years experience in Pacifica. familiwar w/ budget issues. not a finance expert. you know how i chair meetings. i am interested in gettin to a stronger funciton oversight of financials as well as passage of FY 06 budget
mcfall: will email ballot to all members. need deadline for receipt of ballots
adelson: could be 8/9/05 (no objection to that date).
tattersall: mentions that adelson was an observer
mcfall: could take to local committee
tattersall: has no problem with adelson reviewing counts.
MAY 05 FINANCIALS AND UPDATE FROM CFO
mcfall: cannot approve minutes for 7/15 and 7/21 yet because they were not sent. tabled
hicks: an hour ago sent out preview of June financials and progress of budgeting at stations. came via lane
(several NFC members do not have it)
hicks: may financials not reflective of current network status. short spring drive at WBAI had wide effects. cash is always shourt in June-October, but not by these amounts. in past years, when one station had bad drive, other stations were doing well. this year, "many if not most" stations having difficulties. 4 of 5 stations dipped into savings.
don't share the view that we are out of the woods or that there is no urgency. 4 of 5 stations spending reserves to make ends meet. 1 or 2 stations looking at layoffs. use of october drives for septemeber expenses means current FY monies are used to pay off previous FY.
also, soon union raises will be annualized. flat revenues for most station. expenses go up.
we need to recoup $400,000 or more in short term. not a permanent solution
permanent solution -- changing financial scenario. no more increasing $ from listeners. need to do three things. not enough to simply do layoffs. 2-3longterm solutions. need to look at cost structure and business model.
(22:57 hour 1)
hicks: if we look at arbitrons -- we are losing listeners ...
adelson: can you go as quickly as possible to the number part of your report?
hicks: it's in the report i just sent. this year we will not have $1.5 million at end of FY. that will be off by $640,000, mostly due to WBAI's shortfall. Also, this shortfall goes into next fiscal -- each station is struggling with a deficit or shortfall.
need to separate solutions into short-term and long-term. we must act. will send report to full board. make it clear where we are at. will not let of this til we deal with it.
adelson: to clarify -- budget projected numbers are the amount supposed to be reserve at end of sept. (reads from report, B = budgeted in the bank at end of FY 05, A = projected to be reserve end of FY 05 based on June actuals)
PRA B: 40K, A: 40K NO B: 268K A: 246K KPFA B: 434K A: 356K K: B: 261K A: 253K T: B: 108K A: 128K WBAI B: 300K A: -255K WPFW B: 145K A: 145K
(28:00 hour 1)
gatewood: re oversight of NO. what are actual numbers for income for June? Central services for May was over budget.
hicks: june central services -- will have $80,000 less in central services due to WBAI drive shortfall. other indicators -- precarious position in NO. provision of central services to NO happens over a few months. NO had to find ways to pay bills. so NO did fundraising to get reserve to pay bills.
what you will see is that NO overproduced revenue, based on mail drop. $320,000 over budget (?). NO has overspent in salary. overspent by 100K in salary line, 139K in slaray and related. due to incresases for management staff that had not had increase 3.5 years. back to January of 2004 (?). ED laid this before PNB in Jan 2005, sent email to chair, who signed of on bonus, then placed it before ???
that put us over budget. feeling was revenue raised would cover raise in expenses. disagree with assessment that this came through and no one knew about it.
board component of budget/spending: board expense 155K per year -travel, conference calls, training, etc. JUne projection will overspend this number by 82K. reasons: expensive meeting in NY.have compensated for Houston PNB meeeting. will forecast reduced expenses.
administrative NO was underspent by 3K. programming underspent by 16K overspend develeopment (mailings) by 58K. projected by end of FY, NO will be short of one month goal by 21K. Part of it is due to unplanned extra personnel -- Otis MacClay.
adelson: wasn't the Natl PD projected to start in March, natl HR person to start in Jan? this is what we were told in budget discussion slast year.
hicks: HR person budgeted for, but as we move through the buddget cycle there was a proviso that there should be one month operating -
adelson: so you changed it because there wasn't money to get through the projections with the one-month. but the budget for FY 05 included those two positions.
hicks: PNB specifically prohibited hiring nation PD. not sure this position was in budget.
adelson: FSRN budget has amounts for each station KPFK 40K negative variance, KPFT variance 50K positive, WBAI, KPFA had 0 variance.... why is that.
tattersall: has to do that some stations got more CPB CFG money. there is some formula for how this goes to FSRN.
adelson: are you saying your community service grant was larger than expected?
tattersall: yes. we ended up certified as a one level higher of a minority station. this increased our obligation to FSRN somewhat.
(no one seems to understand how this works...)
hicks: KPFT 57 K variance was a mis budget.
adelson/hicks: KPFKs budget in 102K projected annual is 102K
adelson: KPFT 79K, projection is 21K.
hicks: this was an interjection
tattersall: if I could explain - if revenue is down in commuity service grant category then that explains why FSRN is down
adelson: it's off by a factor of 4
hicks: should have put 25%, not the whole amount
tattersall: think the budget was correct
hicks: supposed to only be 25% of CSG, only would have been 21K.
adelson: does this error change KPFT's total standing re being on track for the year?
hicks: in part but not all. budget does not affect actual income and expense, only the variance.
adelson: mailing expenses for NO were budgeted at 0 and are actually 125K. what was the authorization process for that?
hicks: we thought ther would be a shortfall, the idea was to do a mail drop, and we incurred a cost.
adelson: but my question is what is the policy for expenditures by executives that go outside budget.
hicks: variance reports is the point where the explanation is given. is all part of a plan. do we need to have a prt-auththorization process. but every manager has to make adjustments so that they keep the one month. they should have reasonable means to do that ...
adelson: the problem is, if a manager is able to put 100K into a 0 line item, in a budget that was approved by the PNB, then the budget authorzation process doesn't mean much re how money gets spent. my concern re authorizing a credit line is that we have little oversight.
hicks: there is overspending in a variety of lines network wide, esp salaries, that are overspent. NFC should establish guidelines that are reasonable. want budget monitoring process for everyone.
tattersall: re NO salaries. were bonuses and salary increases budgeted?
hicks: over past 4-5 yrs, in lieu of increases, there were bonuses, when ther was cash available.
adelson: but was that budgeted
tatttersall: were raises budgeted
hicks: no they were not budgeted. there had been no raises in 3.5 years. PNB showed little intereest, ED took initiative. told PNB he would rectify situation. not a secret raise.
tattersall: do not begrudge what people get paid, but want it known raises were not budgeted. Do we have an HR person yet?
lane: just signed the letter today.
tattersall: is there a name?
lane: will be sent to the whole board
tattersall: is HR person in the June forecast?
tattersall: is there any severance related money that has been added to forecast that is not part of the budget?
hicks: don't want to mention names, but yes.
tattersall: will you privately advise us of that?
allen: i don't remember the ED saying to the PNB that some people are deserving of pay raises. how many received raises?
hicks: all GMs, national finance staff, not business managers, except one who had not receiveed a rasie in 15 years.
hicks: yeah. one GM did not receive a raise. they had already gotten one from the LSB.
allen: were pay raises retroactive to some time in 04?
hicks: retroactive for 6 months or so.
allen: but weren't there soem people who got raises who had not been working with foundation for 3.5 years, and some who had not been reviewed in several years?
hicks: all the people who got raises were reviewed by ED.
allen: so they have a review in a file that says they are doing a good job?
hicks: "pay raise" misleading. these are cost of living increases. unioin employees routinely get cost of living increases.
allen: i don't remember hearing about this. if you call it pay raises, there could have been some discretion on the issue of merit.
(end of hour 1)
heffley: (hot back of neck) -- never herad about these raisies since jaanuary, when she was on finance committee. 6 months salary is a lot to pass by board. don't see why we bother to pass budgets if there is no correlation between spending and budget. who oversees managers who have overspent. there must be other personnel besides Otis MacCLay at national office that were not budgeted. have incurred legal expenses due to not having HR director. who decided not to hire HR director?
mail drops outside listenership is a policy change from our policy of listener-sponsorship. to do this w/o board apporval, spend more that $100K (over budget), this again makes me wonder why we have a budget.
whose job is is it to oversee managers to ensure that they are not overspending.
adelson: lonnie has said that HR director adjustment was made to get to one month. but who decided that?
hicks: national programming person postponed by PNB. re HR diector, i presented it to Coughlin, and agreeds
heffley: who oversees managers to see that they don't overspend. is there an oversight mechanism, or do we just go back after the fact?
hicks: good question. who is responsible for spending and budget? LSB? CFO? GM? national office?these issues have not bveen resolved. it is worng to focus solely on NO for overspending -- all stations overspend on certian line items. if you want me to oversee it, i will do it, but PNB needs to give me authority. not clearly answered who is in charge?
mcfall: i am hearing several terms - bonus, merit increases, cost of living adjustments. were bonuses separate from cost of living adjustment? how are they put in? there is no line item
hicks: bonuses go in on salary line item,
mcfall: suggest we put in a separate line item for bonuses
what are related expenses?
hicks: consultants, taxes, benefits
mcfall: did you give additional benefits retroactively with raises/bonuses
hicks: same as with union. will be retroactive. taxes can be paid retroactive. benefits, no
mcfall: i am trying to figutre whether bonuses went into related, cause it's high
hicks: one-time retro was 22K in salaries
mcfall: then that leaves 107K in salaries and related that was ??
hicks: 22K is the one- time retro, 17K will be payout to former to ED, 10K is HR person, particular contract person for 6 months, Jon Almelah 6K, any other severance, so it adds up.
mcfall: was retroactive merit increase of cost of living?
hicks: cost of living.
mcfall: so we don't need to talk about what a great job staff was doing. need to be careful to use correct terms
mcfall: the entire cost of living was 22K?
hicks: one-time retro was 22K. ongoing ... 3.5%. at the time said we need a mechanism to reward our management.
mcfall: COLA was 3.5% how much was bonus
hicks: 1 -1.5%
mcfall: need to be detailed cause we keep changing words. want us to use the same words so we know what we are talking about.
re 80K variance on governance -- stations are billed for some of this (GMs)
hicks: NO pays in advance, bills stations back
mcfall: is 82K over and above what stations pay?
hicks: most driven by NY PNB meeting 20-25K over budget. also conference calls.
mcfall: most of this is conference calls?
hicks: detail is in budget
mcfall: one thing that is difficult in doing budget is line items don't match operations. hard to understand what these items are. it would be helpful if we make sure in line items what we are spending and what it is for. need to know conference calls/PNB meetings
hicks: need to think how diecision s get mad e that cost -- PNB meeting expensive cause we want LSB chairs to attend.
adelson: did chairs go to PNB in NY
hicks: they went to other PNB
mcfall: did they get billed back to stations
hicks: not sure. also had board training and consultants. NYC PNB expensive cause there was an extra day.
mcfall: re process for going outside of budget. can we craft a motion that calls for authortization at a certain level outside budget?
adelson: not time to do it today
mcfall: i'll put together a motion and propose it to group
adelson (to CFO): summary projection vs budget for year. this is how we are re 1 month surplus by 9/30. If you add operating reserve we will have from PRA, NO, A,K, T, W get 1.023 million. WBAI will be short 255K. sum that up, get 750K in bank at end of year.
total monthly expense runs 1.16 million in May.
what i don't understand is that it is clear that if no unplanned fundraising is done, we have enough to get through first three weeks in October. why doesn't pulling the main drive forward one week in October solve our cash flow problem?
hicks: 1.16 million does not include central services.
adelson: why do you need to include it? it is circular.
hicks: not in that construction
adelson: but the network spent 1.1 million. we will have 750K as stands now
hicks: still need to include central services
adelson: but no money is being raised, no central services.
hicks: yes and no. even though i raise the money in may. i am paying cetral services on late money from an old drive. ???
adelson: i will say i disagree. that does not create a cash flow problem.
hicks: can't look at one month at Pacifica and conclude everything is OK. after drive, stations have millions of dollars.
adelson: but your projection is that at the close of FY 05, network will have 750K in cash. where is the cash flow problem?
hicks: if network has only 750K in cash as of 9/30, ??? till late october. need 1.5 million. you only have half of that.
adelson: wse have been told that as of 9/30 bills will fall due tht we can't pay. i am saying we can pay. moreover, fundraising around network is around 3 million. even if 40% of pledges are in credit card, that solves our cash flow problem.
(26:35 of hour 2)
hicks: have you been to stations, no. i have, things are not OK.
adelson: i believe it's not OK, what i am saying is that we are being told there is a cash flow crisis, yet the consolidated statement says we will be able to meet our obligations. let's move on
weinmann: i am all for paying management more. but i fail to understand ... we were at best staying even. how is that we decided to give COLA increases in mid-year w/o PNB approval?
hicks: if you go back to that period, we were raising a lot of money at NO. they were affordable then and now. but WBAI shortfall was unforeseeable. need to increase reserve. ED DID get authorization, did announce to PNB, made statement in PNB packet that COLA was going to be done. the idea that all of this was unknown i don't agree with
adelson: notification is not the same of authorization
hicks: no authorization process in place
weinmann: doesn't sound to me like these raises reflect careful planning. very important for us to establish guidelines for spending outside budget and for getting authorization. my perception is that managers want to run network in traditional style. there is a disconnect with new democratic governance
hicks: happy to get authorization. i will control expenses of the network, need authorization and support. i am CFO and perfectly happy to prevent stations from overspending. which is it gonna be -- control of finances, or lack of clarity of who is responsible for what. I placed a motion befor PNB that ED and CFO are empowered to reject any station spending 2.5K out of variance w/ budget. also placed motion w PNB that PNB motions should include cost estimnates.
i will place before NFC that we do control our expenses for any station.
heffley: re board expenses -- what is charged back to stations is not only mangement room, but all adminsitrative council. who decided that people can stay several days -- some people stayed a week. NO allowed this to occur. someone had the bright idea to have demonstration on Monday in LA PNB meeting.
re stations -- there is no one overseeing NO except CFO and GM -- how would CFO police myself that would be any different than what you are doing now?
hicks: right now, or budgets are going to LSBs, they are putting 5-10K in for themselves. I find that objectionable...
adelson: this is not responsive to q
hicks: my oversight is going to come from NFC reviewing and doing variances and from PNB
adelson: we get variances 2 mos after the fact
hicks: NFC gets forecasts. every critical variance should be discussed by the PNB
mcfall: want to respond to proposed process for oversight. we do need a clear process. but your proposal, that you do all the oversight and you put a stop to overspending is opposite of listener-governed -- htat is difficult for me. perhaps we can work on compromise. i would like to see that any proposed expenditures out of budget go to boards and committees. that would protect you. and if we are talking about listener goavvenerd radio -- your process is not that. want committeees t and boards to make financial decisions.
hicks: that would be a bylaws change
mcfall: that would not be a bylaws change. i am open to working together on a combined motion.
hicks: bylawas are not irrelevant here.
(40:32 of hour 2)
adelson: let's move on
heffley: can see nothing in january board packet, do not see notice of COLA for managers, can you direct me to it.
hicks: have it in my hand. it's dated march. pacifica financ and personnel data report. has 10 items. 20 pages of CPB reports on managers pay at other stations. in there is memo from ED to give raise
in item 1 it says ED authorize holiday bonuses of 2%
adelson: you haven't read anything about an unbudgeted raises.
hicks: (reads from document) says ED will be making position adjustments and pay increases for senior staff following the latest round of performance evaluations.
mcfall: you say "following performance evaluations" so these were not COLA. they were merit increases.
hicks: it's both. ????
hicks: needs to get off phone in 1/2 hour
allen: what is the name of the employee who will send me cost of past 6 PNB meetings
hicks: Lynn Magno
WBAI BUDGET CRISIS WORKING GROUP
hicks: has held two meetings. one included GMs. several ideas placed on table. what is remedy? what about opening a line of credit up to 750K? tattersall and hicks look into this
tattersall: spoke to wells fargo, (holds loan on KPFA building)., talked about a 7.25% interest rate. talked about lowering banking charges -- spend 315K /yr in banking fees. also look at bank of america
hicks: WF can have line ready in 2-3 weeks if we need it. i think it is prudent. most organization our size have a line of credit. has not been done before.
adelson: heard earlier that the PNB was notified of intent by ED, and that was equivalent to PNB authorization. (to lane) what do you feel is adequate authorization to open line of credit. can you do it on your own?
lane: believe there should be recommendation from NFC to PNB, and PNB should approve it.
adelson: is it your opinion that you can do this without board approval.
lane: no. i have been trying to get this for a long. this is the only non-prifit i've been involved with that has not had a line of credit. makles no sense that we've been in business in so long and not had a line of credit.
adelson: just want to make sure that PNB authorization is necessary
lane: read bylaws. don't have to get PNB approval to get line of credit.
adelson: so this is a choice on your part.
lane: it's my choice. how can you not do that.
weinmann: re line of credit. we are not a very well-run business, not with the kind of cash shortfalls we have. it's like we are giving teen age boys credit cards. we have survived this far without a line of credit. don't think it's necessary.
lane: is our role just to survive? what is the responsiblity of the board member -- to enhance value of the corporation.
adelson: i see our job as making sure the mission of Pacifica is fulfilled, not necessarily to enhance the value of the assets of Pacifica.
lane: how do you do this without enhancing value of assets?
mcfall: this is a philosophical discussion. i would say the role of a board member changes depending what the organization is dealing with. when you are very prosperous, look at growth, when in lean times, look at survival
hicks: second point in mission is that each unit should be self-sustaining as possible
several: self-sustaining is not a line of credit.
adelson: let's go back to working group recommendations
hicks; not getting a line of credit is gambling we will get gap fundiung
2nd recommendation: syncrhonize start dates of october drive with network wide theme. two days either at beginning or end of fall drive would be for rainy day fund. or could have seperate minidrive in early december (gifts/ holiday season) some GMs liked this, others did not
3rd recommendation: do mailing from NO to raise rainy day funds and archives. we were going to do this anyway. raise 500K. use these funds to offsest issues at station level or NO level.
three recommendations -- not exclusive
adelson: what about september national drive
hicks: was discussed but not ruled out. there was some... about whether to do it or not.
bediako: what are the expectations for budget and operations changes as WBAI? Also, we need more detailed analysis ... what are the needs of stations which are to benefit from the rainy day fund.
hicks: Roberts mentioned strings -- reorganizing WBAI over some period of time so that revenues would meet expenses. there are plans indra has looked over. ensure implementation takes place. second string is to ensure that payback would take place -- would be in budget
re how much -- what is need. take worst-case scenario. even w/ 425K summer drive WBAI needs 150-200K. KPFT needs 30-60 in worst case scenario. WPFW -- talked to GM. they need 60-70K. they will be short the one-month. KPFK -- no needs at KPFK.
(end of hour 2)
adelson: summary you sent out earlier shows no end of year variance at WPFW.
hicks: budget is one thing, cash is another.
adelson: you project they have 145,000 in cash at end of FY.
hicks: the budget only says what you should have.
adelson: but your projection says they will have 145,000 in bank
hicks: my projection does not say that. a budget does not project cash. a budget your accrued on what people owe you, not what you have in the bank.
williams: this goes back to an issue from last year. we need a cash flow analysis that can be done. then we don't have to go into these discussions. also, during inspection, we learned that you are using endowment to fund a programming project and you paid it back. are you using endowment to get NO through this shortfall.
hicks; have not needed to use an endowment. i would bring it to NFC before use.
adelson: there is endowment money that is not figured into any of this?
hicks: it's an em bell sheet (??) investment fund.
adelson: that is available.
hicks: don't consider it as cash at this point. anyway, we need to know what cash stations have. problem is, each station does their own banking. have to call up to find their cash. my dream is to have a centralized bank account. i cannot access WBAI's bank account.
think that NFC and local station, cash flow station is more important than the budget. need a cash review system. how to know how much stations have.
williams: we have huge cash flows from drives. but still need software package that projects cash. also, can get info from business managers, the same way info is gotten re payroll. in order to handle a line of credit, need processes in place. this conversation shows these processes are not in place. CFO does not undersatnd authority of board v authority of CFO. need to lay out what real authority flow in the foundation.
adelson: so what is the cash situation at this point.
hicks: ask each treasurer to ask business managers to produce cash flow statements each month.
mcfall: KPFK business mgr says he needs your permission to give me cash flow statement.
hicks: don't know where that came from
mcfall: can you issue memo that cash flow statements be viewed by treasurers?
hicks: i need to review it first, to ensure it is accurate.
adelson: you just said they get it before you
hicks: some cases they get bank statements before me
allen: perhaps you could ask business managers to send you cash flow statement then you send to treasurers?
hicks: i think we can work something out ...
adelson: you have been telling us about the needs of the network in late september, and then you tell me you need to know cash flow, presumably any number you give us will be based on this information.
so when you told us WPFW needed a certain amount of money, and your projection says they will have 145K at end of september, are you saying what htey have is receivables but no cash?
hicks: in finance, you need to be clear about what a budget is and what a cash flow statement is. cash flow reflects what people have actually paid the station.
adelson: yes. you have made inqueries, and told us WPFW's needs would be 67K.
hicks: they will have to take it out of the drive money
adelson: what does that mean?
hicks: from october drive, they will pay some of those bills with the proceeds from the drive.
adelson: then it doesn't sound to me like there is a cash flow problem, and they have they have those receivables, so what are WPFW's need out of special fundraising.
hicks: if you have to pay bills at beginning of month, you cannot wait til the end of the month to get money.
adelson: well, can WPFW afford that, or not?
hicks: i am saying they cannot. they will have to figure out what bills they can cover and postpone.
adelson: can you tell us about the other stations
hicks: anyway, need to get back to agenda, hope to come from this call with a working group to look at long term solutions.
(10:51 hour 3)
bediako: re refvenue projections for next year -- they are basically cash based numbers. if we have a 1 million drive, 78% fulfillment rate, we will put $780,000 in budget for listener support. is that the way it works
hicks: it's complicated. the answer is that it's 1 million net. net reveue that you receive, in a way, yes, it's cash. other revenue is not necessarily cash -- CPB money grants, etc. is accrued across months. but listener suupport in our budget has a special workwheeth where all expenses associated with drive are netted out befor final number is shown in listener support
mcfall: where is that worksheet?
hicks: it's part of the budget -- budget has four worksheets re salaries, revenue, etc.
mcfall: our committees have been working on budgets for a while, we could use these worksheets.
hicks; i look at the worksheets all the time
mcfall: we are supposed to be developing a budget
hicks: you should go to your station and ask for worksheet.
adelson: (to hicks) you were going down list of stations, telling us their needs, could you tell us about K, T, A?
hicks: KPFK will be OK on cash, tho have FY 06 issues. KPFA will have about 150K at end of fiscal in cash. but they have two months reserve. but stations have used cash they had at the beginning of year to balance bnudget during the year. look at cash and capital. can see what stations borrowed from reserve
KPFT: have worked hard on planning. 30-60 K as a cash issue
NO: we are the caboose. paid last. our need is.. it's hard to say. don't know what will happen at WBAI. worst case scenari is NO needs 100K-150K cash.
adelson: how do you get to 246K at end of september (from preliminary June report)?
hicks: if stations don't pay central services i don't get the money. they owe it
adelson: how do they owe it if they haven't raised it?
hicks: that means they performed below budget
adelson: they don't owe if they didn't raise
adelson: you are projecting you will $246K at NO at end of year
hicks: $246K owed to me
adelson: that means it was actually raised if it was owed.
hicks: annual projection is what i will be owed if all goes well
adelson: what will you not get paid out of the $246K you are owed
hicks: open question now
adelson: but what will you not get paid as cash and why.
hicks: if WBAI is unable to pay some of its bills 9/15-10/15. for them that is $250 million. they will take that money (from october drive) to pay bills and not pay NO.
adelson: so what you are saying is that you won't collect central services on the money WBAI has raised. could be considered money WBAI is short if they paid you.
hicks: then you take all the money the other stations will be short; it adds up.
adelson: you just told us K was OK, A had reserves. that W was 50-60K down, T was
hick: NO will need 100-150K
adelson: how much will network need
adelson: 640K is your projected variance of all those numbers you say don't represent cash.
hicks: they don't represent cash... it's complicated. as of 9/30 station s will have the amounts as shown.
adleson: but you told me those numbers don't represent cash in hand.
hicks: i'm telling you what NO needs as of 10/1 when those numbers hit the wall, NO will need ... 150K
adelson: consolidated around network, what will be needed to get us to the october drive?
hicks: on paper, this network will miss budgetted targets by 640K
adelson: but we've been talking about cash
hicks: talking about cash - cash situation will be that we were short cash by 180K form WBAI then add 50-70K by end of sept. then go to october drive, they will need to pay bills not central services.
13th month situation, by october, they will use drive receipts to cover up shortfall, but true cash shortfall -- half a million dollars. stations have used a whole month of their operating
adelson: i'm trying to get a hanldle on what the network -- we've been told we will not be able to pay our bills, need specila drives, line of credit, etc. i am also hearing a lot about surpluses, reserves, endowments, etc., that leads me to believe we DO have cash to meet our obligations, we just won't have as much in the bank as we'd like.
i am trying to get solid numbers, becuase other wise we cannot understand our needs and plan.
hicks; it's right there - in the may section in cash and capital section. shows how muchs stations have had to draw from savings to meet their needs. june statement, that number will go up. that number is tracked carefully.
anyway, i'm saying the minumum we need is 350K
bediako: What we need is a cash flow for all five stations and consolditate
bediako: before we come to a final decision whether we need to borrow -- we can start from june, roll forward to balance to end of year. that can be consolidated. leave off restricted money (endowmwnt)
then we can see what we need
hicks: thse business mgrs have cash fglow statements. ask them.
mcfall: we do ask them, they say they need your permission.
hicks: you are making it a simple matter of permission. let me finish the thougt. most of these business managers have projected their cash.
bediako: i don't have an updated WBAI cash flow
hicks: i sent it to you. there is one for A and one for W. if outr question is that cash flow situation, i will pull this together. duty of treasurer is to track cash flow.
adelson: what about other stations
tattersall: just got cash flow form from Lois (KPFA). looks like 6K in the hole in September
adelson: 6K re 1 monthe reserve?
tattersall: actual cash in the bank account
(29:40 hour 3)
adelson: does that mean you can't make your bills or have to dip into your savings?
tattersall: means we have to dip into our savings. we are skating on thin ice, not sure how thing
weinmann: KPFT staff does wonderful job managing our finances. T will will finish year with 20K cash balance. will be able to make payroll in october. will not have one month's operating, will have to go into savings. 60-90K is on basis of not having one-month's reserve
gatewood: I have not seen any standardized report re cash flow, though have gotten info from business manager. disagreement re cash position numbers and projections, meet again on monday
bediako: could you re-send WBAI cash flow documents
hicks: yes. "she" did too...
hicks: if i am being blamed ...
mcfall: not being blamed. do you have a cash flow report for K as you are mailing to baruti?
hicks: no, no business manger at K for a while. I will see what i can do for you
adelson: suggest adjourn to next week and tattersall be chair pro tem.
settle on Tuesday 8/2 at 5 pm EST
weinmann: agenda item is to present alternatives re "emergency need for cash" - i will trust lonnie on this. we have not made a decision. i will object to borrowing. our need is not met
adelson: there is no clarity to me about what our need is.
hicks: you don't think there is any information. once we get cash flow from stations that will satisfy dave. can we agree on what constitutes proof?
adelson: i am not talking about proof. how can you prove a number we haven't been given yet?
gatewood: focus on what dave is saying -- what we lack is clarity, not proof.
hicks: cash info is available, lets review it next tuesday
tattersall: i am willing to chair next week
mcfall: want to make sure we have accurate cash flow statements by next week, or why meet?
adelson: lonnie is saying treasurers provide that, right?
hicks: you have to be familiar with the station's cash position. we both need to work at it. i will work at it from my end
mcfall: i need some help facilitation release of info by tuesday
hicks: i will amalgamate it and i'll have it ready by tuesday.
all agree that tattersall be chair next week and ballot receipt for permanent chair date be postponed one week to 8/16.
ADJOURN til tuesday 8/2
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