Sacramento State to Takeover CapRadio After Audit

RADIO ONLINE | Thursday, September 28, 2023

CapRadio

California State University's CapRadio, which operates the capital region's flagship public radio stations, KXJZ-FM (90.9) and KXPR-FM (88.9) in Sacramento, has found itself in dire financial straits. An audit from the California State University system shows the region's NPR affiliate has significant financial problems. According to a report released Wednesday, the station's management mishandled money, took out loans without the knowledge of the board of directors and missed rent payments.

Sacramento State President Luke Wood announced the university would assume operational control of the entity. That would not include the news operations, which will remain under CapRadio's control and separate from the school.

"The finances are pretty severe right now for CapRadio. We owe a lot of money to vendors. We barely have enough cash to keep us going right now. We are making payroll. It's just been a very, very tough time. We have no reserves," said interim General Manager Tom Karlo, in an interview on CapRadio on September 5.

The Sacramento Bee previously reported that the station owes vendors $3.3 million in unpaid bills from the past two fiscal years. One of those vendors is NPR, who has gone unpaid for more than a year.

In a statement released Thursday, the school said it is instituting changes in financial oversight and management for CapRadio in response to the findings from the audit. "This course of action is designed to address and resolve areas of significant mismanagement and lax accountability within the auxiliary that are highlighted in the CSU audit," said Sacramento State.

Sacramento State will move the operational management of CapRadio under University supervision, including a forthcoming permanent General Manager and several upper-management positions. A new Chief Content Officer, who will oversee station programming, will remain an auxiliary employee, ensuring CapRadio's journalistic independence.

Sacramento State will also oversee and manage CapRadio's accounting department, endowment and finances to ensure the auxiliary remains in compliance with CSU financial policies, procedures, and state law.

"We are fighting to save our auxiliary," said Wood. "CapRadio has been part of the fabric of Sacramento and northern California for decades. It is important to us to maintain the health and integrity of such a valuable and beloved media institution."