While Seattle'ês newspaper community and others wait to see whether the soon-to-be-gone print Post-Intelligencer will remain in some electronic form, the bad news just keeps rolling out of the Seattle Times Co. A long memo circulated by Times labor chief Alayne Fardella to Times staffers yesterday, March 3, noted that the Times'ê February print revenue was off a whopping 45 percent from a year ago. February is traditionally a weak ad month in the newspaper business, but if things don'êt pick up, Fardella warned, 'êwe will need to explore additional options for expense savings.'ê
Another item in Fardella'ês memo noted that the Times pension plan, which has been overfunded for years, got clobbered by the collapse of the stock market and now is only 65 percent funded. Under the 2006 federal Pension Protection Act companies must carry the accrued value of their pension plan obligations as a balance-sheet liability and eventually make up any shortfall. That means the Times Co. would have to pump more than $10 million into its pension plan in 2011, depending on how the stock market performs, said Liz Brown, administrative officer for the Pacific Northwest Newspaper Guild, which represents the Times newsroom employees.
Fardella sought to put the best face on things, noting that other pension plans around the country have similar shortfalls in their pension plans. Meanwhile, the Times Co.'ês pension problems were underscored by its minority partner, McClatchy, which announced in a federal securities filing late Monday that it had written down the value of its 49.5 percent share of the Times Co. to zero. Two and a half years ago, when it acquired Knight Ridder and its stake in the Times Co., McClatchy valued the holding at about $102 million. In its filing to the Securities and Exchange Commission Monday, McClatchy blamed the writedown on the Times Co.'ês 'êretirement plan liabilities.'ê
Fardella said the Times is not likely to see another across-the-board round of layoffs like the 500 jobs that the newspaper cut last year, but warned that some departments may still face additional cuts. The company is seeking wage-and-benefit rollbacks of 12 percent from its union and non-union staffers and Fardella said those rollbacks will continue through 2010.