Richard Phelps: "The insubordination of the CFO requires his dismissal ASAP. He is an at will employee so no cause is required..." For those directors who might feel some "cause" is required (and whose votes will be needed), people should be preparing a list of the CFO's failures to comply with instructions (or even "requests") from the PNB and/or from the Executive Director. Some new directors may need some examples from before their time. If not possible "yesterday" (i.e. if not already prepared), it should be done today. --Frank LeFever > From: PhelpsMediation@xxxxxxx <PhelpsMediation@xxxxxxx> > Subject: Re: [Fulcrumsofchange] Letter to Pacifica Radio Network Family > To: wanzala@xxxxxxxxx, NewPacifica@xxxxxxxxxxxxxxx, > fulcrumsofchange@xxxxxxxxxxxxxx > Cc: pnb@xxxxxxxxxxxx > Date: Sunday, July 13, 2008, 11:34 AM > The insubordination of the CFO requires his dismissal ASAP. > He is an at will > employee so no cause is required. Given Pacifica's fear > of law suits, his > recent conduct along with much more in the past, makes any > suit by him a loser. > I hereby offer to defend any such suit, should the PNB find > the courage to do > the right thing to save the Foundation, at 1/2 of my > regular rate plus > costs. I would do it for free except that I have to be > able to pay my overhead. > > You also need to replace the Chair with someone that is > fair. The > discussions of the pressing issues must take place on a > level playing field. She has > been demonstrably biased during every meeting I have heard. > > > More later. > > Richard Phelps > Attorney/Mediator _PhelpsMediation.com_ > (http://phelpsmediation.com/) > 405 14th St. Suite 508 > Oakland, CA 94612 > 510 268-9919, Fax 268-0368 PhelpsMediation@xxxxxxx > > > In a message dated 7/13/2008 7:53:37 A.M. Pacific Standard > Time, > wanzala@xxxxxxxxx writes: > > Dear Pacifica Radio Network Family; > > The PNB Chair wrote: "As we are all aware the > Pacifica Radio Network > is in the worst financial situation of its recent > history." While > this may be a true statement, there is clearly a major > difference in > how members of the PNB would deal with this situation. > > Over the past 6 months, the 2008 PNB has worked to > understand and > address the crisis of management and finances of the > Foundation and > its stations, as well as its contractual obligations to > its > Affiliates. The majority of the PNB determined that it is > in the best > interest of the Foundation and > its stations to hold the National Board's next > in-person meeting > immediately. There are concerns about permanent > structural, > procedural, and employment changes being made and proposed > without PNB > oversight or approved plans. These are complex issues > that the Board > must consider and resolve. There are missing answers and > proposals > regarding the managerial, financial, and programmatic > short and long > term health of the Foundation and the Network. The absence > of this > information and plans jeopardize the Foundation and > marginalize its > elected representatives. For all of these reasons, the > majority of > the PNB, then, decided to hold, as the Bylaws require, the > next > in-person meeting as soon as practical, which was July > 25th. > > In May, 2008, the PNB passed a motion to plan and prepare > a budget for > the Pacifica By Laws prescribed June in-person meeting. > At that > time, a taskforce to implement the motion was appointed by > the chair; > and the CFO announced that the Foundation could afford a > $20,000.00 > meeting. (As opposed to the $50,000.00 meetings previously > held and > repudiated by PNB '08 and LSB members.) > > > > Pursuant to a previous motion ( Houston PNB meeting) > allowing the > prescribed June meeting to be held in July, August, or > September, the > weekends of July 17th or 25th were used for planning > purposes after > consultation with the PNB Chair, and in consideration of > proposed > political convention coverage. In light of the urgency of > the > situation, task force members went to work immediately and > diligently > to locate sites, talk to facility schedulers and the > PNB's travel > agent. They planned a meeting for $20,000.00, inclusive > of air fare, > for the weekends of either July 17th or 25th as approved > by the Board > and advised by the CFO. > > > > Two status reports were issued to the full PNB and a > special > telephonic meeting was called on June 13, 2008 to answer > PNB member > questions, select or prioritize selection of the facilities > and set > the date; an effort to rescind was subsequently defeated in > a > telephone conference on June 25th, by a vote of 11 to 8. > > The PNB selected the weekend of July 25th and the CFO was > directed to > contact and contract for the preferred facility (Pacifica > By Laws Art. > IX Sect. 9B). Accordingly, members purchased tickets and > made other > arrangements to be present. The CFO has failed to do so > and refused > to comply with the PNB's instructions. The PNB Chair > and Foundation's > Executive Director have since been asked to direct the CFO > to comply > with the Board's directive, and have also not done so. > > > > Not only does the Pacifica Radio Network's financial > situation > necessitate immediate attention, but the PNB is the only > body that has > the responsibility and authority to formulate the policy > necessary to > resolve the situation and oversee the staff's > implementation of that > policy (Pacifica By Laws Art. V Sect. 1(D)). The PNB > scheduled the > weekend of July 25th, Washington, DC as the time and place > to do so. > As confirmed in a recent Foundation Counsel Memorandum, > deciding to > spend the money to have the meeting is a legitimate board > decision. > > > > The 2008 PNB has scheduled it next meeting, July 25th, to > insure that > critical bills to vendors, staff, FICA, etc are in fact > paid. It > would avoid the continued imposition of piecemeal > measures, and the > passage of another questionable budget in September; all > under the > guise of "no money". It would address the short > term aspects of the > current crisis, in anticipation of ,and laying the > foundation for, > long term solutions and the health of the Foundation and > Network; > including consideration of a recovery plan, utilizing > elements of the > plans submitted by the ED and CFO. But what if there really > is "no > money" for the meeting? > > > > A review of the CFO's June 30th spreadsheets clearly > indicates that > the Foundation and its Network has difficulties but is not > insolvent. > While there are political concerns at issue, and > structural > adjustments that have to made, the notion that the > foundation cannot > afford to meet in person to exercise > its fiduciary duty as mandated by the bylaws is simply not > true. > > >From the CFO's spreadsheets, sent on June 30th to > the PNB and LSBs, > the cash in the bank for the network, predicted for the > 1st of July, > was $2,158,388. This was based on actual figures for cash > on hand at > the end of May and included a prediction for the KPFK > drive that was > essentially accurate. Had the $20,000 been allocated then, > the Network > would have > > $2, 138,388 in the bank at the beginning of July. > > There are shortfalls at WBAI that and KPFK for operating > expenses that > will have to be made up in July and August either by > transfers from > other stations or a bank loan, as the CFO has pointed out. > Assuming they > are made up by transfers, so we don't incur any > additional expense for > bank loans, then the difference between the cash on hand > in September > 30, 2007, when the cash balance was $2,245,980, and the > prediction for > September 30, 2008, which is $2,060, 804, will be > $185,176. This assumes > no action by the board, other than approving the cutbacks > to FSRN and > the proposed cutbacks in the national staff and stations. > This does > not include the cost of the law suit recently settled at > KPFK, of > $125,000. > $572,475 of the balance at the end of September is > restricted, and > could not be used for general purposes. > > The Sept 2008 figures are based on fulfilling goals for > summer and > Sept drives, so , as a worst case scenario, we could end > the year with > roughly $400,000 less cash on hand than we started with, > assuming > cutbacks of the scale proposed are made, with that figure > uncertain by > probably $100,000. That is a reduction in cash on hand by > roughly 18%. > > That is an understatement of the seriousness of the cash > flow problem, > as there were no September drives in 2007. If we deduct the > estimated > returns in September at KPFA and WBAI of $554,00, from the > cash flow, > then we would have had, without advancing the drives, a > reduction of > $864,176 in cash on hand at the end of 2008 compared to > 2007, a > reduction of 38%. > > This is a serious problem, requiring the board action to > revamp our > programming, make structural adjustments, and find the > economies of > scale and centralization that the ED has suggested are > possible. It is not an > imminent financial catastrophe that requires us to abandon > our bylaws. > > > More importantly now, it does not require us to allow the > entire > governance structure to be sidetracked by asserting that > an action of > the board can be countermanded by the CFO on the grounds > that he has > been asked to do something impossible, find $20,000 for a > meeting of an > organization with roughly $2 million cash on hand, after > he had been > given the authorization by the PNB to transfer the funds > to finance > the meeting. . > > To do so, is to attempt to govern this organization > outside the > framework that was decided on at the time of the take back > and > marginalizes the Board, which has the final responsibility > in our > bylaws and California law for the fiduciary health of the > Foundation, > the Network, and affiliate obligations. If that framework > has flaws, > and it does, there are mechanisms for changing those > democratically, > with the full participation of the LSB's. We would like > to see the > Foundation and its Network be a powerful and stable > institution, > protected by whoever sits on the PNB or in th_e ED and CFO > positions. > That can't happen if we continue to defy our own > bylaws. An > organization becomes institutionalized when the people who > make it up > internalize the rules that define that organization, and > act by them. > That is what is required now of this generation of > Pacificans. Let's > not be penny wise and pound foolish, squandering the legacy > we've been > entrusted to preserve and grow. > > Grace Aaron (KPFK) > Carolyn Birden (WBAI) > Kathy Davis (WBAI) > Efia Nwangaza (Affiliates) > George Reiter (KPFT) > Jamie Ross (WBAI) > Wendy Schroell (KPFT) > Joe Wanzala (KPFA) > _______________________________________________ > Fulcrumsofchange mailing list > Fulcrumsofchange@xxxxxxxxxxxxxx > http://lists.pacificana.org/listinfo.cgi/fulcrumsofchange-pacificana.org > > > _ (mailto:phelpsmediation@xxxxxxx) ====================================================