Pacifica Foundation may enter into a voluntary bankruptcy if it cannot secure a loan to pay a $1.8 million judgement due to Empire State Realty Trust (ESRT). The judgement fee is for the company missing lease payments for the WBAI New York (99.5) antenna and transmitter site located on top of the Empire State Building in midtown Manhattan.
According to the Wall Street Journal, Pacifica's interim executive director, Bill Crosier, is urging the foundation’s board to protect the organization's assets from creditors with a voluntary chapter 11 filing.
In an email and resolution sent last week, Crosier said that Pacifica’s finances have been mismanaged for years, and asked for the board to agree to file for bankruptcy. The resolution revealed that Pacifica has not paid into its employee retirement plan, to which it now owes $750,000, the paper said.
As Inside Radio reported, a New York judge ruled that ESRT can seize Pacifica's assets to collect what it's owed. That possible scenario prompted a recent email from Pacifica sister station KPFA Berkeley, CA (94.1) GM Quincy McCoy who said the station’s “money and property may be seized by the Empire State Realty Trust because of a $1.8 million debt of our sister station WBAI.”
Sabrina Jacobs, who is the foundation vice chair and a producer at KPFA, agreed with Crosier that the best way to protect Pacifica’s assets is by filing for bankruptcy. “Time is running out,” she said. “We owe money, and we need to pay the money.”
Crosier echoed those sentiments in his email. “We have exhausted all options at this time to secure a loan or to pay ESRT judgement or secure a forbearance agreement,” he wrote. Crosier said the company’s assets, including bank accounts, are in “imminent danger” of being seized or subject to a lien.
The board plans to discuss the possibility of filing for bankruptcy this week. The Journal reports that a small majority of board members disagree with the recommendation of filing for bankruptcy as they believe ESRT will not move to seize the company’s assets.
Under either scenario – a loan or a filing of bankruptcy – Crosier believes some changes will have to be made in Pacifica’s operations, which may include a signal swap of one or more of its radio stations.
Pacifica owns five radio stations: WBAI in New York; KPFA in Berkeley, CA; KPFK in Los Angeles; KPFT in Houston; and WPFW in Washington, DC.