In the shadow of San Francisco-based public media giant KQED, a pair of FM radio brands have gained an audience with one dedicated to Classical music and the other focused on spoken word programming courtesy of NPR and the BBC. Listeners not only in California’s state capital, Sacramento, could tune in but also those in the Reno, Nev., area in addition to Modesto and Stockton, Calif.; and Yuba City, Calif., too.
Today, these twin offerings, found across 7 stations, are operated by CapRadio on behalf of its licensee, the California State University of Sacramento. However, that’s about to change, as an organizational audit of the entity that held financial oversight and management of the stations has led the school to assume control of the FMs.
In a statement released Thursday, the school popularly known as Sacramento State said it is instituting changes in financial oversight and management for CapRadio in response to findings from an organizational audit released today by the California State University Office of Audit and Advisory Services.
The CSU audit reveals “substantial problems” within CapRadio. Given these findings, operational management of CapRadio will be placed directly under university supervision.
Importantly, the news and entertainment programming of the National Public Radio affiliate will remain independent.
CapRadio’s spoken word programming can be heard on KXJZ-FM 90.9 in Sacramento and on repeater FMs in Quincy, Stockton and Tahoe City, Calif. The Classical programming is based at KXPR-FM 88.9 in Sacramento and rebroadcast on stations licensed to Groveland and Sutter, Calif.
“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,” Sacramento State said, adding that the findings detail “long-standing issues.”
Those issues, the school said, include “a lack of financial and governance processes and protocols; lines of credit and loans secured without campus approval or CapRadio Board of Directors awareness; submission of inaccurate or incomplete financial information to the board, the Corporation for Public Broadcasting, external auditors, and the university; and much more.”
Sacramento State’s financial team recognized discrepancies in financial statements; then-President Robert S. Nelsen in 2022 subsequently requested the CSU organizational audit, the university said. Since July 2023, Sacramento State’s President has been Luke Wood. He said, “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. The financial implications of CapRadio’s mismanagement have significant consequences for Sacramento State, but we will make it through.”
He also said that now is the time for the community to continue its support for CapRadio. “Given the changes the University and CapRadio board are putting into place, donors should feel confident moving forward that their generous contributions will be well stewarded,” he said.
Since August 2023, Tom Karlo has served as interim General Manager of CapRadio. At that time, 12% of CapRadio’s workforce were given pink slips, with fiscal challenges cited as the primary reason.
With 47 years of experience working in public media and expertise in addressing financial challenges, Sacramento State says Wood and his leadership team have developed and will work with CapRadio to implement a five-point plan to stabilize the station’s management, finances, and operations.
What does this mean?
- 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 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.
- Sacramento State will require CapRadio to rotate auditing firms on a biennial basis to ensure the auditing process remains unbiased.
- Sacramento State has commissioned a forensic examination to determine the origins and causes of CapRadio’s operational and financial problems.
- Sacramento State will require CapRadio to adhere to the auxiliary license and operating agreement, which requires the station to uphold its educational mission to benefit Sac State students.
Wood acknowledged this is a difficult time for the organization’s staff and members.
“We are fighting to save our auxiliary,” Wood said. “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.”
The Classical and spoken word services of CapRadio date to the early 1990s; it was originally known as Capital Public Radio, formed in 1998.
