tell you, is that we are changing leadership. i was involved in the interviews for a new head of development at the station. we are looking to have that higher completed by the end of the month. that is going to be a big plus. during this past year, we have participated in something called the leadership project. it is funded by the corporation for public broadcasting, which is the umbrella of federal organization to support local stations as the try to build their major giving capacity and community engagement. we have had the benefit of consulting services that have allowed us to build a court of leadership volunteers at the station, active community members to help us reach out to major donors, who helped us making our story -- making our case for support stronger. that has been really valuable. i think what we need is to tap

into community enthusiasm and have that go to work in development efforts at the station. we have also -- let me step back a second. that is what i get for talking off the cuff. we have also really begun research into our current big donors so we know who the people are who support the station and know where there is room for increased capacity and giving. i do not know if you have worked with nonprofits, but one of the most important things is to know who your supporters are. we have over 11,000 supporters in this community, people who in the last 15 months have made contributions to the station. some of those folks need -- some of those folks can do more. we need to learn more about who those are. over the last 2.5 years, we have faced the same challenges that nonprofits across the country

have. it has been a challenging time for fund-raising. in the report, a talk about the fact that if you look at fiscal year 2009, we had a 50% drop in individual support, which is three-quarters of our operating budget. we went up 5% last year and are at about the same point this year. we have been running a deficit for those three years. that is why we are in a position right now that we are coming and asking for this short-term line of credit. it will allow us to turn around development efforts and take advantage of the initiative we have and the story we have to tell to funders. we have held the line on costs. we are doing a great deal with the resources we have to work with. i am also, in this next year -- there will be changes to programming. we are looking at some specific -- i talk about in the audit

that you all got, specifically talking about streaming services. we are going to try to consolidate contracts to cut costs. i am very focused on pushing the revenue side. i think we have great opportunities. i am also looking at everything we can squeeze in the budget. given what we are doing, i think the future is to talk to the philanthropic community in this area about how we can do more on the revenue side. that is where i am focused now. what we are asking you to do tonight is a bridge to that. we can be in that place where we have that really strong strategic development effort that brings in resources that make sense given the service we are providing. i will leave that there. i am sure you have questions for me. thank you so much for the support you have given to kalw.

i hope we can continue a dialogue about these issues. i have a great relationship with the cfo and our liaison here in the district. the art in conversation with me. -- they are in conversation with me. when it comes to implementing a longer-term plan, i will be talking with them. i will do interim reports with the budget committee or other relevant committees to keep you informed. i see this about me being accountable to you all, and also making sure you know where we stand as an enterprise unit of the district. we will make sure you know what we are planning and the plan that we have. commissioner murase: i have four points. in your material, you talk about

being the oldest non-commercial fm signal west of the mississippi. that is something you can be very proud of. what is your overall operating budget? secondly, in terms of governance, do you have and the advisory board that you work with? is there a strategic plan in place in which the development director plays a role? to what degree our students involved in generating content? i would be very interested in seeing the degree to which students are involved in the operation of the station, but also student-generated content. the terms of a loan -- how should we think about a loan? are we thinking about taking money away from the classroom to offer this loan? how should we be thinking about the loan? that is an important question.

>> the budget is $1.70 million. we do not have an advisory board. part of what we are working on in our leadership for philanthropy program that i talk about in the report is specifically recruiting leadership volunteers. that could be the basis of an advisory board. i think some kind of -- given that you all have a lot to do and a lot of things to attend to, some kind of role where there is community advice coming in. to provide that would be valuable. there is not a strategic plan for the station as a whole. students involved in generating content -- we have done some special projects with students. we brought a group of students to work on a specific story or a specific documentary. we do not have an ongoing

presence of students as a regular element in creating programming. your last question about how we think of the loan -- >> as it relates to the loan, i have spent a lot of time with matt. we basically met with a couple of my own staff, probably either every two months. we've been doing that for at least three years. we know at least the financial part of a pretty well. the last couple of years, as he mentioned, have been difficult as it relates to the donations. the expenses on the expense side -- it has been pretty flat, somewhere between $1.40 million and $1.50 million. we also have an outside auditor that comes in every -- that

comes in and reports to public broadcasting where this radio station is. the difficulty formats group has been the fact that the last two years but have been running in a negative position as it relates to revenue over expenses. prior to the year 2000 08 -- 2008-2009, they had a significant balance. what put them in the position was the amount of restricted programs. my discussion started at the end of last year to ask for credit. unlike a couple of our other programs, where we make contributions, i recommend that

should not be the case. to get to the cash flow issues, the recommendation was to do a line of credit. the other recommendation you could look at is we have people on our salaries, we have contracts, and we just don't pay bills until we have cash to pay them. i do not think that is the proper way of doing things, when you have a station that is really working hard to get somewhere. what we are requesting is a line of credit up to $200,000 to be paid as we go along the up to the june 2012, getting over the hump. i do not see any risk in this. we are not taking money from children. we are basically taking a loan. we would be paid interest on that loan. quite honestly, we own the station. we have collateral. as far as everything else we do,

this is pretty safe, as far as i am concerned. we also, as you might see in the audit, which puts a little more pressure on that, is the discussion as relates to a going concern. they are spending more than they take in. therefore, he does have some pressure on him to break even this year. just having a loan is not going to help him. he needs to have work. based on his comments tonight and what he has been telling us for six months or longer, he is committed. i think we should support him. commissioner norton: thank you for the presentation. i want to follow up for a minute on what you just talked about. you mentioned that the loan would be paid back with

interest, but in the requested action it does not say anything about it. it just says it will be repaid -- will be reimbursed to the district. i do not know if we need to amend that. >> if you like, you can amend that. it was always understood would pay interest based on the amount of money received from the city pool. commissioner norton: what is the source of the funds we would be using for the credit? >> it would be the general fund. commissioner norton: the unrestricted general fund? we do not anticipate that are going to be drawing down that hole $200,000 at one time -- whole $200,000 a one time. does that put pressure on our own cash flow? >> it does not right now, but they could run up to $800,000.

not at one time. commissioner norton: so you anticipate that the way he would use this is by making withdrawals, essentially. >> we would do withdrawals. basically, we pay the bills. we control kalw. we will give them money when they need it. commissioner norton: it is either pay the bills or do not pay the bills, essentially? >> they did $178,000 in the month of december. they spent 110,000 a month. -- i am sorry. $148,000 a month. the had a negative position of somewhere -- let us say $120,000 right now, with my understanding to fund-raisers coming up over the next six months. commissioner norton: mr. martin,

a kind of wanted to get your response -- i kind of wanted to get your response. i am looking at the auditors' report. the line saying from the auditor that there is substantial doubt about the station's ability to continue is a concern. i wonder if you can respond to that and give your response to that statement. >> i think we have a great opportunity? this question does come from a couple of years. we have been in a position where we go on the air, we ask listeners for support, and from that have been able to run a very successful operation. the situation has changed to where that is not adequate to do what we need to do to serve this community. in the past year, we have been working on developing

relationships with the major donors, at being in a position to identify foundations as their copper's comeback and they are in a position to take on grants. -- as their coffers come back and they are in a position to take on grants. the work we are already doing -- when it comes to funders, we have a good track record. we are drawing the attention of some folks who have money to support public media. when we have looked at who our current donorsi think there is e -- low hanging fruit. we can translate into make that support go a long way. we have a huge opportunity to do that. she is not someone who is the fund-raiser.

and so, we have different perspectives on that. in the work that we have done with the philanthropy project, working with people from the public radio fund-raising world, i see the success stories that have happened at other stations. that is what we are focused on in our interviews and head of the development effort. what you're experiencing is creating a strategic fund- raising plan. can you create a balance that is the bread and butter and also looking at foundation support. president mendoza: i really appreciate the work you are doing. it is my understanding that we're the only school district and they used to be more than held licenses. >> there are some others.

president mendoza: i know that i talked about this the last time you were here. i thought the documentary that you did was fabulous. i would love to see more collaborations' like that. at this point, i don't really have an objection to the support that you are asking for. it worries me because when you have been here before, times are tough. it does worry me for the future because i want to see the station be stronger and continue to be strong. our mission has to be financed independently. >> i want that, too. commissioner yee: you guys have great programming over there.

they worry about global issues, national issues, and local issues. a couple of things. the last time you came here, you mentioned some new programming. you were pretty excited, you were mentioning it at the time. you were involving the students of the more. that is one thing. if you're still doing that, we should know about that. i guess, i am hearing that your reserves are all gone at this point.

>> they are all gone. commissioner yee: i just wanted to make sure of that. i like your idea of the advisory board. i am surprised that this board has not challenged the station to have this. when you create this, i recommend you ask the board of education to have a sitting representative on the advisory said that there is more connection between them and us. >> i would welcome that. >> i am sure -- i am not sure what you're referring to from my last report. one of the things that has changed for us is that a good amount of it, my kind of feeling is that we have a high school here. one of the things that is

changed their is the status of journalism. it is part of an after-school program rather than being part of the curriculum. it was one of the best ways we had -- it was a perfect opportunity. we had a set of students that were engaged. i am still working with them in some other capacities. but that provided a lot of opportunities, we had students sit on the editorial meetings. we had a number of guests. we would go and say, how do you have a student with experience relevant to that? that is the best way, to make them part of the larger conversation.

unfortunately, it does not give us that easy place to go and say that your students clearly interested in journalism. i will tell you this past year, for me, i have been working very hard on the development questions. it has left a little less space for having that day-to-day relationship. that a sum of the challenge. >> i know how much time you have in terms of engaging each student -- i don't know how much time you have in terms of engaging each student, but i would love to know about it so that i can listen to it. >> i should send you an e-mail. commissioner murase: i want to thank you for your effort on

this. it seems like you have been working alone for a long time. >> there are a lot of us working out than there. >commissioner murase: i would be happy to be our resources in the journalism world -- in the journalism world. have you had a chance to explore if there are similar types of revenue? when i was in high school, i was engaged in the journalism program. it is such an important component of education that i would really support efforts to connect the national association. >> there is a great deal of money in those organizations. most of the places we found support for doing local

journalism comes from the corporation for public broadcasting or from local foundations. media is one element of it. the means seeking of support -- do you mean seeking out support of student journalists? that might be the way to go. >> looking at your schedule, i of see any district programming at all. i am wondering if you have a few comments, and do we utilize this for advantage in terms of getting information out and having a show that highlights some of the things that we are doing. >> we are certainly an outlet for school district information and inviting people to forums and doing teacher recruitment. we provide space for those

announcements. we don't have a dedicated place for information about the school district program like you are talking about. >> i think we should have a slot or the superintendent speaks regularly are we have a place for a teacher or principal to do something on a regular basis. it just seems to make sense. on the short full peace, you are saying that the 200,000 won't really cover the shortfall, so you're having to raise some more. what is the shortfall? >> he basically needs $1 million to break even. >> we are only going to give you 200.

so you will fund-raiser for the rest? >> he will do that for the whole budget. it is just a bridge loan. he doesn't have to go out and find it. he has some fire under him. president mendoza: i still feel strongly that we should have some -- >> we have discussed some options, and there are a lot of the opportunities there. it is a matter of looking at ways to make that work. i appreciate the encouragement and i think we will continue to

pursue that. commissioner fewer: i just want to say, it is disappointing that the journalism class was canceled considering it was wrecked on the campus. i can appreciate the fact that among all of the nonprofits, you are looking at development right now. you're looking at it more aggressively, and i think they have all had to become much leaner and redirect the development efforts at a different way. and going after those dedicated listeners in supporters you have had for many years. and i want to also mentioned a thank you. i think this is also a good idea for us to do. i am glad to hear that we are financially able to do it.

i also want to mention to anybody, especially to my fellow commissioners, if you want to help out at one of the fund- raisers, we have done that. when you do that, you hear how people in the answer telephones of actual listeners. they tell you how much they love a particular program that you have. people say that they love the spotlight on the local musicians. people have their favorite shows and they take those donations. that helped to boost the spirits of the fund-raising.

we are going into a couple of hard years. it is going to take a lot of generosity on the folks that are able to be generous at this time. i encourage everyone listening to send a donation. commissioner wynns: i really appreciate the reports that we have been getting. i think that in a better world, we should be investing in the station and that is a way for us to really have more of a partnership to use it as a resource for the school district. i didn't want to be critical about this, but i wanted to mention that we are trying to build a development capacity

within the school district, and that is something that we might look at. we could apply for funding or integrate this into our fund- raising on a regular basis. i understand that we really don't have much capacity to do that. as we do work on that and hopefully get better at it, i am hoping the station will benefit from that and the opportunity for us educationally. i wanted to say that the listeners are the most faithful and enthusiastic public radio consumers in the bay area. every time there has been discussions, there was a board

-- how you see the enthusiasm and the love of the station that is expressed by listeners and supporters. i think it is good that we are capable of doing this. of will have success in the future. -- and i hope that we will have success in the future. commissioner murase: i wanted to make sure that i stayed because i really enjoy your presentation every year. i just love it. commissioner yee was with us that one morning. i don't know what time of the morning it was, 6:00? just to hear their loyalty, and they were so surprised that we they were so surprised that we were there.