KPFA’s iconic building on Martin Luther King Jr. Way is set to be auctioned off March 20 because of the non-payment of taxes.
The progressive radio station has not paid property taxes on 1929 MLK Jr. Way since December 2013, and currently owes $486,751 to Alameda County. The Tax Assessor’s office has a contract with Bid4assets to sell off delinquent properties. The public auction will start at 8:30 a.m. March 20 and continue until March 23 at 3:30 p.m. The minimum bid is $486,853.
The station has until March 19 to pay the debt to stop the auction.
“We’re all freaking out about it,” said Christina Huggins, the chair of the KPFA local station board. “We’re all worried about it. It’s alarming.”
The management of the Pacifica Foundation, the parent organization of KPFA, and four other radio stations around the country, did not respond to a request for comment. Huggins and other KPFA officials have been told to step back and not get involved with the tax bill, said Huggins.
She and others believe that the Pacifica Foundation has hired a Southern California law firm, Alpert Barr & Grant, to negotiate a settlement with the Alameda County Tax Collector. Berkeleyside’s call to Alpert Barr & Grant was not returned. Lydia Brazon, Pacifica’s new interim executive director, did not return Berkeleyside’s emails.
The enormous property tax bill is only the latest crisis for the progressive radio network that started in 1949. For many years there has been infighting among various factions at the Pacifica Foundation and inside KPFA, as well as between the foundation and radio station. There have been revolving executive directors and interim EDs at Pacifica Foundation — 19 since 2003 — and a changing cast of board members at KPFA. The internal politics are complex and hard to follow, but they have hampered the organization’s ability to solve its fiscal woes and capitalize on its assets, critics say.
“It’s disassembling,” said Huggins, who has been on the KPFA local station board for five years.
One example of the factional infighting is that a press conference has been called for noon today outside KPFA’s offices. It is being convened by at least two former KPFA board members who don’t like the direction the foundation and station are taking.
Riva Enteen, a former chair of the local station board, sent out a press release about the gathering. Tracy Rosenberg, who served six years on the local KPFA board and was formerly treasurer of the Pacifica Foundation board, is scheduled to speak. She has been vocal in trying to bring attention to the delinquent property tax crisis.
“Board members, staff and listeners are asking: Is this the result of incompetence or internal sabotage?” a press release stated. “The plan to turn KPFA into NPR-type programming was defeated in 1999, yet the rogue KPFA management has engineered a financial meltdown through deliberate fiscal mismanagement to force its hand once again. This has resulted in an imminent auction of the Berkeley building.”
This dissident group says the non-payment of taxes is “an engineered financial meltdown.”
Huggins and others say the reason KPFA has not been paying its property taxes stems from the time the Pacifica Foundation legally changed its name but neglected to register the new name with California’s Board of Equalization, which oversees nonprofits.
“That has resulted in the loss of the non-profit tax exemption for KPFA.” Huggins wrote in a Feb. 5 email to officials of the Pacifica Foundation.
Since the new name was never registered as a nonprofit, the Alameda County Tax Assessor’s office levied a corporate tax rate on the KPFA building, not a nonprofit rate. With the tax exemption, the rate would have been $1,500 a year. Without the tax exemption, the rate was $53,216 a year, wrote Huggins.
So KPFA did not pay the property tax because once paid at the higher rate, the money would not be retrievable.
KPFA’s business manager reached out to the Pacifica Foundation board many times to urge it to follow through with filing the corporate name change with the correct state offices. This was never done, said Huggins.
KPFA could not file the changes since Pacifica, not the Berkeley radio station, made the name change, she said.
The “changes were made by officers of the PNB, (Pacifica national board) and must be signed by an officer or officers of the PNB,” Huggins wrote Pacifica. “Local KPFA Management is not legally empowered to make those changes, although they have made many efforts to work with PNB officers to do so.”
Rosenberg contends that the Pacifica Foundation board thought the KPFA business manager was taking care of the name change. (Pacifica has hired Rosenberg as a $60 an hour consultant, according to Huggins.)
It is not clear if there is enough money in Pacifica’s coffers to pay off the $486,751 property tax bill. The foundation has been on financially shaky grounds for a few years.
In 2018, the Pacifica Foundation was $8 million in debt, according to a statement by the then-executive director. A huge chunk of that debt came from WBAI in New York City, which had been unable to pay rent for its transmitter on top of the Empire State Building. In 2016, the landlord, Empire State Realty Trust, had sued Pacifica for $1.3 million in back rent. A New York Supreme Court judge ruled in favor of ESRT in 2017, awarding the company a judgment of more than $1.8 million.
Help arrived in 2018 when the nonprofit lender FJC agreed to lend Pacifica $3.4 million to pay off ESRT. The terms freed the foundation from making any payments for 18 months and allowed it to pay interest only for the next 18 months. The loan must be paid off in 2021.
In trying to reach financial stability, the Pacifica Foundation also sold its office building at 1925 Martin Luther King, Jr. Way, next to KPFA, according to Rosenberg. That sale prompted the foundation to move its headquarters from Berkeley to Los Angeles in December.
Rosenberg said the foundation has an endowment fund that could be tapped to pay off the delinquent property taxes.
“Using an endowment fund to pay a defaulted property tax bill is not ideal but it’s better than losing the building,” said Rosenberg.
Long-simmering tensions between Pacifica Foundation and KPFA
The Pacifica Foundation was founded in 1946 by Lewis Hill and other conscientious objectors from World War II. They started KPFA in 1949 to present a pacifist message to a wide working-class audience. At the time, California would only grant the station an FM license at a time when AM stations dominated. KPFA is the oldest listener-supported radio station in the U.S. and has consistently delivered award-winning programming that offers perspectives different than those presented by most mainstream media.
Pacifica was originally created as a foundation to support KPFA and it grew into an organization with five stations in the U.S. and multiple properties. But there have been numerous battles for control between the foundation and KPFA in recent decades.
In 1999, Pacifica locked out KPFA staff members for two weeks and fired Larry Bensky, a popular radio host, and Nicola Sawaya, the station manager. In 2010, the executive director of the Pacifica Foundation laid off Aimee Allison and Brian Edwards-Tiekert, the co-hosts of The Morning Show as part of a cost-cutting measure. Edwards-Tiekert was reinstated in 2011 with back pay and benefits but returned as a news reporter, not as a show host. (He currently is the co-host of Upfront, KPFA’s morning program).
Matthew Lasar the author of Uneasy Listening: Pacifica Radio’s Civil War, told the New York Times in 2014 that the foundation had such an elaborate governance structure with separate boards from the various radio stations that it had “left the network in a near-constant state of conflict among warring factions,” according to the paper. “If Pacifica radio had a coat of arms,” it would be a turnstile,” Lasar said