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Aug 10, 2010 7:24 PMPublication: The East Hampton Press

With deadline looming, radio station still short of funds

Aug 10, 2010 7:24 PM

With just about two and a half weeks left until the deadline for the final $637,000 payment owed on the licenses and equipment of the former WLIU radio station, the station’s manager says the money to complete the purchase is still not in place—and that, in fact, the fledgling corporation’s board of directors has not actively met in many months.

Wally Smith, who managed WLIU and has steered the effort by Peconic Public Broadcasting, a corporation formed by former WLIU employees and supporters to keep the station on the air, said that the group has a significant chunk of the money needed either in hand or in the form of a promised donation should the checks need to be written, but he acknowledged that the bulk of the money has yet to be raised. Nonetheless, he said that the group’s fund-raising team is still working to secure the requisite pledges from major donors to close the deal with Long Island University.

“From our side, everything still remains very positive, and we remain very hopeful that we’re going to meet our deadline and be able to close this deal,” Mr. Smith said. “Can I guarantee it? No. But do I have reason to believe it will happen and be hopeful? Yes.”

While Mr. Smith may be optimistic about the station’s chances of completing the deal, former board members and even some current employees are not of the same mind.

“I like all of them and I think what they are attempting to do is certainly admirable,” said Paul Brennan, a former member of the now-dormant board of directors of Peconic Public Broadcasting. “But I think it’s like pushing that proverbial rock uphill, given the economic circumstances. I appreciated the fact that they wanted me on the board, but people like myself are not the caliber of people that they needed. They needed real heavy-hitters on that board.”

When PBB first formed last fall, a board of directors was seated, including Mr. Smith, Porter Bibb, one of the founders of Peconic Public Broadcasting, Press News Group Publisher Joseph P. Louchheim, former Sag Harbor Village Mayor Pierce Hance and Mr. Brennan, a vice president at Prudential Douglas Elliman. Mr. Smith said the board has not met or been active in the management of the group’s effort to run the station or the fund-raising effort in many months.

Mr. Brennan said that for such a massive fund-raising effort to be successful in the context in which the radio station is operating would require board members who could drive the fund-raising effort themselves, rather than Mr. Smith and other semi-involved volunteers.

Mr. Louchheim, who resigned from the board in March, echoed his sentiments. “I resigned ... because I was too busy with other commitments, and I believed then, as I do now, that the only way the project would succeed is with an extremely active and engaged board of directors,” Mr. Louchheim said.

Mr. Brennan wondered whether the group could have attracted the sort of people to sit on the board who could attract more six-figure donations, or make them themselves. But on-air personality and longtime East End observer Steven Gaines, who hosts a show on 88.3 FM on Sunday mornings, said the potential donors are out there but could not be lured because the group did not have a proper business plan to show would-be investors, and would not offer seats on the board of directors to those who wanted some say in how their investment was managed.

“It’s too late. I’m afraid all is lost, and I think the outcome of this is that the station will change hands,” Mr. Gaines said. “I had someone who I knew could write a check for the whole amount—I was going to ask for $250,000—but I knew I had to have a business plan and offer to be on the board to make that call.”

Mr. Gaines said Mr. Smith wouldn’t guarantee a board seat to major donors, and that the Peconic Public Broadcasting business plan was not updated until late last week.

Mr. Smith said he was never asked if a certain person could have a seat on the board. He said he would be willing to offer a board seat to anyone who demanded it in exchange for a large investment in the station, but that an official process of approval has to be followed by the three official members of the original board.

The station’s business plan, according to Mr. Smith, shows an annual operating budget of just under $1 million and an anticipated revenue stream from fund-raising that would leave a small surplus. Last year, the station’s operating budget was over $1.7 million, but Mr. Smith said that has been slashed drastically though reductions in staff, substantial salary cuts for the station’s remaining employees, and much lower rent at the station’s new studios in Southampton Village, in relation to what it was paying Stony Brook-Southampton to broadcast from the studios on its campus.

Mr. Smith acknowledged the late date of the updating of the business plan but said that limited manpower and changing realities of managing the station dragged the recalculations out.

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If, by some miracle, they can somehow save the station, first order of business: fire Wally Smith and get some new blood in there. Next: limit the tired jazz programming and instead offer more programming that is relevant to the community. And last, involve all of the East End Schools to provide programs similar to Youth Radio on NPR stations: http://www.youthradio.org/. These are low cost, high value programs that can be created in studios in local schools by students. By sponsoring new program ...more
By Laszlo Lowenstein (37), East Hampton on Aug 12, 10 4:28 PM
3 members liked this comment
This station is a money pit!!! I feel like I have been hearing this sob story for like 10 years....board it up already!!!
By GoldenBoy (351), EastEnd on Aug 12, 10 6:42 PM
Well, I for one, would strictly have to go online to hear "Engines of our Ingenuity".

Not that it would totally suck, however...
Aug 13, 10 3:34 AM appended by Mr. Z
By Mr. Z (11847), North Sea on Aug 13, 10 3:34 AM
As many-generations "locals" of modest means Ihave supported this station to the best of my ability in order to help keep a sane voice on the radio. I agree with Mr Lowenstein that IN ORDER TO SURVIVE the station MUST BECOME MORE RELEVANT to the COMMUNITY. The downhill "slide" seemed to all begin when they stopped PROVIDING LOCAL NEWS in the MORNING and dropped "The humor of Joann Sherman" who did her best to start your day with a smile. Fortunately WE DO HAVE OTHER CHOICES for NPR NEWS, the ...more
By Muscoot (7), Hampton Bays on Aug 13, 10 6:48 AM
Too bad the local community is going to lose the station, but it was getting tired anyway. They did a lousy job raising the $800,000 to buy the license. According to the article they didn't even form a board. A bunch of amateurs.
As for Muscoot's observation that the downhill slide began when they stopped providing local news, well, that was only a symptom. They stopped providing local news because they couldn't afford it anymore, they had all those enormous salaries to pay. Why doesn't ...more
By EastEndDenizen (3), East Hampton on Aug 13, 10 10:22 AM
I sound like a broken record when it comes to excessive compensation, and it's always the same old story.

"Well, if we cut salaries this year, the savings would be minimal."

WELL, how about the CUMULATIVE cost of said compensation over the course of a decade, or two?

Sounds like a significant amount of working capital from here...
By Mr. Z (11847), North Sea on Aug 13, 10 10:28 AM
One of the problems with the plan for the station is that it is not "progressive" enough - and I mean that in the most positive dictionary definition sense of the word (i.e., making use of or interested in new ideas, findings, or opportunities). Stop emphasizing the "what was" or "what is" and look at the "what ifs." This station could be an incredibly important resource for the East End community if there was someone with a real progressive vision who could do a re-boot. Keeping the same old ...more
By Laszlo Lowenstein (37), East Hampton on Aug 13, 10 1:51 PM
1 member liked this comment
As they say, money talks, and mierda del toro walks...
By Mr. Z (11847), North Sea on Aug 13, 10 3:33 PM
They were doomed the minute they allowed Steven Gaines to host a radio show.
By Noah Way (450), Southampton on Aug 13, 10 11:51 PM
I think a smart move would be to seek the directors from local private schools that have a curriculum around communication arts. Then make sure that the students interested in broadcasting used the station for educational purposes. The Ross School comes to mind but there may be other schools interested in to project.
By Scratch (26), Sag Harbor on Aug 14, 10 11:31 AM
Although I've heard many nasty things about Steven Gaines over the years, I tried not to believe all of what I've heard ... but now, those things, combined with his comments to the press about the radio station, biting the hand that hired him and trashing the station that pays him, is probably not even a new low for him. How awful to be disloyal ... what an embarrassment, Mr. Gaines ... you should resign from your show.
By Nancy Q. (27), east Hampton on Aug 14, 10 2:47 PM
Wally Smith has a huge ego -- sure, he fooled those idiots running LIU (also egomaniacs) for many years, but he's finally getting his due.

What a sham WLIU was for years -- claiming to be a college radio station but where were the students? Where was the educational element? What smalltown college radio station has people on staff with six-figure salaries?

Adios, Wally. Your station failed because it had no soul.
By Mr Suffolk (113), Twin Forks on Aug 15, 10 12:04 AM
You would think that with all the higher than thou programming, the british accents, the uptight hosts and npr it would be taking off!
By package4 (39), hampton bays on Aug 15, 10 9:01 AM
Mr. Suffolk, what are you talking about? WLIU hasn't been a 'college' station for years; it was owned by the university, and that's as far as it went. As far as salaries, does anyone have any comment on your salary? The station hasn't failed - it has consistently produced high quality award winning programming and is a valued and important asset to this community. and, packaged4, what station are you listening to? british accents? were you listening to the BBC news or that station in Connecticut ...more
By Nancy Q. (27), east Hampton on Aug 15, 10 9:14 AM
Well, we can probably reasonably wager that Mr. Suffolk probably earns substantially less than six figures, like the vast majority of us who post here in this public forum.

Fact remains, the cumulative effect of the excessive salaries earned by those employed by a PUBLIC radio station, was most likely a hefty contributor to it's budget shortfalls, and it's eventual undoing. They pillaged the coffers, of which fund were not only donated by the community, but by the taxpayers of the state ...more
By Mr. Z (11847), North Sea on Aug 15, 10 8:36 PM
I remember what is now WLIU when it started up in the 1970's. Different call letters, different frequency and 10 watts of power. It was at the time operated as a college radio station by students at the Southampton campus. Even though it was a shoe string operation, I could still pick up the station in Sag Harbor. Students operated the station until 2am with programming of their choice.

The college next upped it's power to 150 watts soon afterwards. The station operated out of the basement ...more
By BruceB (142), Sag Harbor on Aug 15, 10 12:37 PM
Give it back to the students. At least they could figure out how to run a good station on a shoestring budget. They did in the past. Back in the day, WPBX was completely student-run, with free-form programming, Like everything else on the East End, it apparently got hijacked by the weathly interlopers.
By Undertow (64), Southampton on Aug 15, 10 12:48 PM
It is indeed sad to see this happen, although to some degree the economy and budget cutbacks from governments that had traditionally provided grants that were reduced or withdrawn is a substantial cause.

But for full disclosure let me add that I speak with some knowledge of the broadcasting industry and "public" radio in particular. In fact I was one of the founders of Hamptons Community Radio which currently operates the 88.7 station in East Hampton, and has just been given the FCC go-ahead ...more
By MattS (7), E H on Aug 15, 10 2:37 PM
I try never to comment on post by others but in this case Undertow has it dead on, hook line and sinker! If our community wants a real public radio station then
Smith and Grice should happily stand aside and put it back in the hands of the people, not the hands of two.

I have a feeling if that were the case, you would have no problem getting the loot.
By ride the truth wave (125), southampton on Aug 16, 10 10:33 AM
Wally Smith has always been and continues to be the problem. The big money that is available wants the place shut down,
By EastEnd68 (888), Westhampton on Aug 16, 10 11:19 AM
Res Ipsa Loquitur.
By PBR (4956), Southampton on Aug 16, 10 5:42 PM
1 member liked this comment
Quis custodiet, ipsos custodies?
Aug 16, 10 9:11 PM appended by Mr. Z
Sorry, "ipsos custodes"...
By Mr. Z (11847), North Sea on Aug 16, 10 9:11 PM