Public station, private owners: KPLU sold amid university's financial struggles
Substitute KPLU with the name of an uncle or a close friend, and Monday’s meeting of the radio station’s community advisory committee would have seemed like a funeral. One after another, KPLU’s staff, community advisors and listeners openly mourned the sale of the NPR station to its bigger sibling KUOW.
The anguish in the room was the result of an awkward and, for many, unfortunate reality: the public radio station that offers a day-to-day backdrop for dedicated listeners hangs its license with a university that is obedient to the fiduciary responsibilities that come with being a private institution.
So while many of the station's donors, who helped build KPLU’s broadcast center at Pacific Lutheran University in 2009, feel the rug has been pulled from beneath them, the sale of the station is likely on its way to approval barring a change of heart from the boards of regents at PLU and the University of Washington. In a last ditch appeal, the community advisory committee will appeal directly to Pacific Lutheran University President Thomas Krise in an attempt to inspire that change.
Combining KUOW and KPLU has been on the table for nearly twenty years. In 1998, KUOW made a formal pitch to KPLU to unite under the Puget Sound Public Radio umbrella, largely in an effort to consolidate fundraising. But PLU rejected the deal for reasons that mimic the concerns voiced at Monday’s meeting -- that KPLU “might be dominated by UW, the larger of the two licensees,” according to a 2000 report from the UW advisory board.
The final spur in recent months, according to PLU’s VP of marketing and communication Donna Gibbs, was a desire to cutback on redundancies in Puget Sound public radio and because the timing was right. PLU was not in trouble, she said, but the value of its radio station was diminishing.
However, according to former member of PLU’s board of regents Larry Neeb, PLU’s enrollment has taken a major hit recently, with 2014 enrollment down significantly from 2011. “It’s absolutely true our enrollment was down by roughly 200 students,” said Neeb from his home in Webster Groves, Missouri. 90 percent of PLU’s operating budget comes from tuition and fees. “It was a crisis because 200 students down meant $5 million in revenue.”
In response to this so-called crisis, PLU established its Strategic Enrollment Management Advisory Committee (SEMAC) in 2012 “to help the institution achieve and maintain the optimum recruitment, retention, and graduation rates of students.” Separately, the university also passed a 2013 resolution that seemed to contradict the sentiment that PLU was experiencing a crisis, pledging to raise faculty salaries, maintain facilities and expand the cash it had on hand.
The happy bubble of the resolution was burst, however, when a 2014 SEMAC report said the goals of the resolution wouldn’t happen without “a substantial amount of additional net revenue above the level the university would normally expect to receive from existing sources.” Things wouldn’t get much better in 2015. Despite a rosy freshman enrollment forecast, the graduation of PLU’s 2015 class meant the university would see a reduction of 100 total students.
Nevertheless, Thomas Krise authorized a 2.5 percent across-the-board increase in salaries and wages for all employees last March, in keeping with the university’s 2013 resolution. But the bump coincided with a reduction of 40 full-time administrative and faculty positions. “These reductions are a necessary step as we continue the work of integrating academic planning and enrollment management with budget planning and revenue allocation to ensure that our expenses are in line with revenue projections,” wrote President Krise in an e-mail to PLU’s staff.
To make things worse for PLU, Standard & Poor’s said in a September press release that the university is on the verge of defaulting on a $54 million outstanding bond. Combined with the decreased enrollment, S&P downgraded PLU’s credit standing.
Gibbs said in an e-mail Tuesday, "This proposed sale has nothing to do with PLU finances," but that it was a “strategic decision.” She elaborated, saying, "Among the eight largest independent colleges in the state of Washington, PLU has the second lowest total debt outstanding, and the lowest debt per student....Fall 2016 undergraduate inquiries, applications, admits -- and declines -- are at five-year highs, continuing trends from last year, including our highest graduate enrollment in the history of the institution."
With regards to her comment that this was a strategic decision, one can understand this strategy from a national perspective. The Washington Post recently reported on the declining number of NPR listeners across the country. More worrisome still, young listeners are nosediving their way off of the FM dial.
This is not the case for KPLU, however. The station's fundraising drives have been immensely successful lately, and listenership is at an all time high according to KPLU’s manager Joey Cohn, hitting 438,000 just last week. The average three years ago was 350,000.
But it was also difficult not to notice that, with the exception of KPLU staff and media covering the meeting, those who had come out to the advisory committee meeting to support the station were older. This could have been the timing of the meeting – middle of the day Monday – but the detail was there nonetheless.
KPLU’s community advisory committee meets on a quarterly basis. Its existence is a requirement of the Corporation for Public Broadcasting, which contributes to KPLU. The body usually meets in a small room at the Westin, speaking only to one another. Monday, though, was closer to the meetings at City Hall. After calls to the public to attend, it was moved upstairs to a conference room that seemed well suited for keynote speakers and business conventions. It quickly filled with nearly 300 people.
Lynn Johanson of Ballard came downtown for the meeting because she was “ticked off enough to ride a bus.” She’s a painter who likes listening to KPLU for its jazz programming, interspersed with the NPR newsbreaks. She’s been listening since the 80s and donating since the 90s, even if only $25 here and there. She, like many at the meeting, described KPLU as family. Although her jazz will stay on 88.5, she doesn’t think it will last. “They’re so disingenuous,” she said of the universities who cut the sale. “I don’t trust them.”
The committee’s role is usually to talk about what sort of content they’d like to hear. On Monday, it served a bigger purpose. Of the maybe 15 members present, they all voted in opposition to the sale, giving member Stephen Tan the authority to draft a letter to Krise appealing the sale.
The body is only advisory and Tan acknowledged that its scope is limited to urgings. He also noted that, while he and other committee members would have preferred they be consulted before the sale, the university had no obligation to do so. As Crosscut has previously reported, although KPLU staff would have liked the opportunity to buy its own independence, the university wasn't required to consider competing offers.
It’s an awkward thing that KPLU, an affiliate of a national news organization that has public in its very title, is perhaps not as public as some thought. As Tan pointed out numerous times, KPLU does not have a governing body independent of PLU. “It was in the back of my mind that the station ought to have its own governing body,” he said. “It’s unfortunate that it does not and I think it’s one of the reasons we’re here today.”
This same awkwardness is reflected in the frustrations of donors, some of whom gave earlier this fall. Johanson believed her donations over the years meant KPLU’s staff were her employees to some extent.
Another item that has come up is PLU’s 2009 construction of its Martin Neeb Center, the $5.9 million building that houses KPLU’s Tacoma station. Gibbs told Crosscut last week that in addition to adding to the university’s endowments, the sale of KPLU would allow PLU to use the full of its Neeb Center for students. The space for KPLU within that building is listed as a donation from PLU.
But many who helped fund the Neeb Center, including Larry Neeb, believed their donations were meant for the station, not the university itself. When the university’s plans to build a new building stalled out as the great recession hit, it launched a capital campaign to fund its completion. In newsletters and newspaper articles at the time, the new building was pitched as the new, state of the art home to KPLU. Martin Neeb, for whom the building is named, was KPLU’s manager for 25 years.
Debora Johnson, an employee of the City of Kelso, Washington, doesn’t remember how much she gave, but knows it was enough to get a plaque. “I don’t want to sound like I did more than others, but for me it was a lot,” she said over the phone. “I was not donating to the school, I was donating to the radio station.” When she heard the station was being sold, she was shocked. “I thought of asking them to refund my money.”
For however much Johnson gave, it certainly did not match Larry Neeb’s $1 million donation to complete the building. He’s a devout Lutheran and served on PLU’s board of regents off and on for 16 years. He watched as KPLU took on its identity as the home to jazz and news. “We had a campaign that was really not going to make it,” he said of the new building. “I didn’t see the financials. I just knew it wasn’t going to make it.” And so, Larry Neeb drew $1 million from his considerable wealth to complete the station, dedicating it to his brother Martin.
Unlike Johnson, Neeb loves the university. He stays in touch with the people who run it and cares deeply about its future. Neeb gave the $1 million primarily for the radio station, but when Krise approached him shortly before the announcement of the station's sale, telling him KPLU would no longer live in the Neeb Center, Neeb – after some amount of deliberation -- gave the PLU president his blessing. Asked if it angered him that his money was going towards a different purpose than he initially intended, Neeb said, “Of course it crossed my mind. But in the end I thought it through. It wasn’t something I would have started, but I will support it.”
When asked why he believed Krise reached out to him, he said, “It was to seek out my opinion and my goodwill. I don’t know what he would’ve done if I’d said no.”
For those hoping to kill the sale, the only hope is a direct appeal to Krise or the FCC, which still needs to approve the deal. While some came to Monday's meeting with a fighting spirit, others seemed more daunted by the odds. In a tribute to Cohn, news director Erin Hennessy’s voice cracked, calling the station “something to be damn proud of.” The room stood and applauded, but her speech had the feeling of a eulogy.
Former PLU President Loren Anderson politely declined to speak at length on his impressions of the sale. He seemed also to understand that PLU is in a tough spot. “When you leave a position,” he said over the phone, “the people who are in charge need to make the judgment.”
On the phone, it was hard to read exactly how Anderson felt. But as media and higher education remain in flux, he acknowledged that things are changing. “During our time, KPLU was an important part of the university. But this is a different point in their history.”
This story has been updated to add a response from Donna Gibbs not received before publication.