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Sacramento’s CapRadio mismanaged funds for years, audit reveals

California State University has appointed an interim administrator in an effort to save CapRadio from insolvency.

California State University has appointed an interim administrator in an effort to save CapRadio from insolvency.

The president of the California State University (CSU) in Sacramento has appointed the university’s vice president of business affairs to oversee its public radio network.

The appointment of Jonathan Bowman to serve as the interim administrator of CapRadio comes after an audit conducted by CSU Sacramento found that widespread financial mismanagement over the last several years has left it with a bare-bones budget, with the radio network facing insolvency within the next three months.

“As a nonprofit auxiliary, CapRadio cannot file for bankruptcy, and any debt accumulated is the ultimate responsibility of Sacramento State, its fiduciary,” a spokesperson for CSU Sacramento said in a statement over the weekend, using the local name attributed to the university.

Bowman first raised questions about the financial fitness of CapRadio in 2021, which led the university to conduct an audit of the public radio network. The audit, released late last month, found station executives secretly opened new lines of credit, spent money without the approval of the CSU Sacramento board and submitted “inaccurate or incomplete” financial records to university officials, the Corporation for Public Broadcasting and external auditors.

Among other things, the audit revealed current and former station executives were sometimes late in covering payments on various credit accounts, which incurred significant late fees and penalties. Managers also did not secure written agreements with two vendors working on behalf of CapRadio to accept and handle vehicle donations from the public. And executives purchased more than $1.1 million worth of studio equipment and furniture through loans that were never approved by CapRadio’s own board of directors as required.

“One thing is abundantly clear: We have real and immediate work to do to ensure CapRadio’s financial controls and operational processes are disciplined, sound, and transparent going forward,” Luke Wood, the president of CSU Sacramento, said last month.

The appointment of Bowman as interim administrator of the radio network is one of many steps CSU Sacramento will need to take to steer CapRadio in the right direction — both financially and operationally.

“I am a believer in public broadcasting and am committed to public media and to seeing CapRadio through this difficult time,” Bowman said in a statement. “I look forward to collaborating with interim General Manager Tom Karlo and CapRadio to address the issues identified in the audit, restore public trust in the station, create sound financial practices, and develop a new operating agreement with the University.”

CapRadio currently operates two separate and distinct radio stations: a KXPR (89.9 FM), which has a 24-hour classical music format, and NPR member station KXJZ (90.9 FM).

Programming from both outlets is rebroadcast across large portions of the Sacramento Valley and Northern California through several full-power repeater stations and a number of low-power translators. Licensed radio stations in Stockton, Tahoe City, Quincy, Groveland and Sutter are among the full-power repeaters used by CapRadio to redistribute its programming and solicit funds from the public, and CSU Sacramento holds the licenses to most of these stations.

While administrative oversight will shift to the university, officials at CSU Sacramento say programming-related decisions will still be made by independent staff members at CapRadio, without university involvement.

There have been signs for months that something substantial was likely going to go down at CapRadio following the departures of several key executives and long-time staff members.

Rick Eytcheson, who joined CapRadio as its general manager in 2006, stepped down in 2020. He took on an emeritus role until earlier this year. Jun Reina, who succeeded Eytcheson as general manager of CapRadio in 2020, resigned this past March.

Last October, CapRadio’s Chief Content Officer Joe Barr resigned after spending more than 20 years with the radio network, including a 13-year stint as CapRadio’s news director. His choice to succeed in the role of news director, former Sacramento News & Review editor Nick Miller, left the station in June to become a communications director at the California State Assembly.

In August, CapRadio said it was laying off 12 full-time workers in order to address financial headwinds afflicting the station — though the gravity of its money problems was not well-known until the audit was released last week.

Among those laid off were Nick Brunner, CapRadio’s long-time music director, and “Blues Party” host Mick Martin. Several digital content producers were also let go, as were those in similar digital-focused roles.

 

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About the Author:

Matthew Keys

Matthew Keys is the publisher of The Desk and reports on the business and policy matters involving the broadcast television, streaming video and radio industries. He previously worked for Thomson Reuters, Disney-ABC, Tribune Broadcasting and McNaughton Newspapers. Matthew is based in Northern California, has won numerous awards in the field of journalism, and is a member of IRE (Investigative Reporters and Editors).