in Houston, Texas
KTRU broker cost University of Houston $200K; deal inked within months of U of H furloughs, other cuts
Thursday, Jan 27, 2011, 04:03PM CST
By Steve Miller
U of H

The University of Houston agreed to pay $200,000 plus expenses to the non-profit firm Public Radio Capital for serving as a broker in the $9.5 million deal to acquire Rice University’s student radio station KTRU, according to a contract for the deal obtained by Texas Watchdog.

 

The contract was included in more than 250 pages of e-mails and other records released by UH, following a January state Attorney General’s ruling that determined the records were open. UH had fought their disclosure and succeeded in withholding some information. 


The deal securing Public Radio Capital was finalized in June 2009, with the purchase approved last August -- all within months of the U of H instituting furloughs, a hiring freeze and pay freeze as the state struggled with declining revenue and projected budget shortfalls.


The e-mails show that U of H continued to pursue the KTRU deal even though some donors to its public radio station felt the purchase was unsound.


One donor, whose name was withheld, e-mailed Grover Campbell, VP of government relations at U of H, and referred to a report that found classical programming would lose money. KTRU was meant to complement U of H's NPR affiliate KUHF; the university planned to use the additional frequency to broadcast classical music around the clock and turn KUHF into an all-news channel.


"I did speak with Ed and he basically confirmed what was in the report - classical is expected to lose $1M/year for the university plus the cost of acquisition and financing," the donor wrote. "Hard for me to understand how to justify that for a university that is laying people off." 


It's unclear what report the donor is referencing, and U of H did not respond to a reporter's inquiries.


SIGNAL 'LESS THAN IDEAL'


Much of the new correspondence involves John Proffitt, the CEO at KUHF, U of H’s public radio affiliate who was a chief advocate of the acquisition. His e-mails show officials knew there would be challenges with the KTRU signal.


“KTRU has – I will be charitable – less than ideal coverage in the southern half of our 88.7 range. An important consideration,” Proffitt told Erik Langner, PRC’s director of acquisitions in an email on June 15, 2009.


Langner responded that he was aware of the problem, saying in a missive the next day that KTRU’s signal to the south has “shortcomings” but that he was intent on proving that the station’s non-commercial, education signal is "one of the best” in Houston.


As the deal moved forward, U of H officials worried about how the idea would be received publicly. Previously released messages showed a concerted effort to conceal the transaction from the public.


Rice ensured administrators were kept in the dark about the deal, too. In a June 2009 e-mail to Proffitt, Langner cautioned against making any contact with Rice.


“No one at Rice, other than the president and a select number of advisers, knows that this is happening," Langner wrote. "It is critical at this stage that no one at Rice is contacted with regard to this transaction.”


By April 2010, Langner was promising UH officials that any public consternation and protest would fall on Rice, not U of H.

 

KEEPING CALL LETTERS OFF PUBLIC NOTICE


The released records detail the behind-the-scenes plotting to keep the call letters KTRU off the agenda for the Aug. 17 U of H Board of Regents meeting to approve the purchase --- a move that open government advocates have criticized.


Seeing those call letters on the agenda would no doubt attract public attention. U of H public relations official Karen Clarke fired off an e-mail on Aug. 10, a week before the meeting, to Langner and demanded to know who decided to include the KTRU call letters on the publicly-posted agenda:

“Can you please tell me who is going to make this public on the UH website? As chief info officer at UH, I was not aware that KTRU would be specifically named. If you can let me know how you expect this will happen, I can take steps to manage it to a better outcome for all concerned.”

Langner, too, appeared worried about including the call letters:

“When I spoke with John Proffitt yesterday afternoon, I was informed by him that the agenda would include the KTRU call letters. I have no other source for this information and no other reason to believe that this would be the case. So it seems that there was simply a misunderstanding with respect to this topic. If the board materials and website are not going to list the KTRU call letters, then I have no idea how this would become public.”

The letters were eventually left off the online posting for the meeting, as well as the backup material for the item regarding the sale.


In doing so, the board and university may have violated the state's Open Meetings Act, a point that the group Friends of KTRU has brought before the Federal Communications Commission.


Friends of KTRU filed a petition to deny the transaction last month, and Rice and U of H filed a response. Friends of KTRU then responded to that filing, which ended the 30-day public comment period.


A decision on the license transfer can take months. There is no deadline for the FCC to rule.


Contact Steve Miller at 832-303-9420 or stevemiller@texaswatchdog.org.


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Photo of U of H sign by flickr user Onilad, used via a Creative Commons license.

Comments
anonymous
Thursday, 01/27/2011 - 04:25PM

The broker is corrupt.

Gary Packwood
Friday, 01/28/2011 - 05:52PM

This article assumes that radio signals will never change over time yet there is all types of creative communication research happening to improve the FM signal.

FM-HD for example.

And the PBS TV channel(s) are now Channel 8 and 8.2 here in Houston.

And there are several proposals pending with the FCC to require Smartphone companies to include FM or FM HD with their phones.

All of this creative change is very much part of the UH mission but has nothing to do with the mission of Rice.

There are many reasons why UH should make use of this most underused resource of Rice and most of the reasons are new opportunities presented by new signals and the need to broadcast programs in different languages.

Be a WATCHDOG all you want but get an expert on radio signals on record before you create another headline for yourself.

You look silly when you only have 1/4 of the story.

Concerned Cougar
Friday, 01/28/2011 - 06:24PM

President Khator does not seem to understand the current economic situation. She is on a spending spree while the university is facing serious challenges. The KTRU deal is just one example.

President Khator's mismanagement of UH-Victoria caused tensions between the community, the President of UH-Victoria (Dr. Hudson), and herself. When she decided to remove Dr. Hudson last August, she created a new high-level, high-pay position (Special Assistant to the Chancellor for International Programs and Initiatives) for Dr. Hudson to, we assume, silence him in exchange for this consolation prize...

The pattern repeats itself: Dr. Khator has just removed Dr. Elwyn Lee from the VP for student affairs position and again created a new high-level high-pay cabinet-level position (vice president for community relations and institutional access) for him!

Recently she took 18% $75,000 raise for herself. Her perks (mansion, car, driver, maids, etc) and the salaries of her administrators are outrageous.

She is now taking credit for things that happened before her arrival to UH. The NRC rankings, the Carnegie classification are all based on data for years before she came to UH. People in the community don't know this and think she is doing a great job. To the contrary, her performance has been rather poor and the negative effect of her mismanagement will be apparent in the future. By that time, she will be gone somewhere else, having taken credit for the achievements of those who have preceded her and leaving the blame of her mismanagement to those who will follow her...

The Board of Regents needs to wake up and put an end to this.

radio fan
Saturday, 01/29/2011 - 09:22AM

so lemme get this straight - KUHF plans to buy an FM station for 9 MILLION, launch 2 new full-time broadcast services, hire a new BIG salary "public media" CEO and "consolidate" staff - all in a matter of about 6 months?! WTF are those ppl thinking? how many JOBS will be lost in the process - all in an effort for quality "community service" ? REALLY?

smooth and rough
Sunday, 01/30/2011 - 06:09PM

Concerned Cougar wrote: "President Khator does not seem to understand the current economic situation. She is on a spending spree while the university is facing serious challenges. The KTRU deal is just one example."

There's a newly uncovered email on the UH side about a loss of $1 million per year if the current existing audience for KUHF is split across two stations with twice the operational overhead expense. This is a vanity project encouraged by people on the UH side who are playing with other people's money. Attempts to conceal this from the public should be a crime.

Ba'al
Monday, 01/31/2011 - 05:38PM

I agree with the previous comments about the current spending spree at UH. In response to one of the comments, Elwyn Lee is the husband of Sheila Jackson Lee, and UH would have liked to have fired him from his position as Dean of Students long ago. But owing to who he is, he was seen as untouchable. So they created a very expensive VP position for him to at least get him out of the way. It is one way to solve the problem, I suppose. SInce Khator has come to UH, there have been several other really bad choices on how to spend massive amounts of money, "investments" that will see no return at all. However, with inside knowledge I can tell you that one questions one of her decisions at one's own peril. Previous administrations were useless in their lack of vision. Khator has that, but has poor judgment on how to implement her vision without bankrupting the place.

This radio station deal is insane, and I believe that the goal is to improve the "community engagement" aspect of theUH that shows up in certain university ranking schemes. Bear in mind that the resulting radio station is something that will not be listened to by many students at either UH or Rice.

No ethics at home - no ethics at work
Monday, 01/31/2011 - 09:53PM

When Dr. Khator was hired, the Board of Regents changed nepotism rules to allow the hiring of her husband as a faculty member. Despite a serious lack of credentials, her husband had been hired as a faculty member in engineering. But it did not stop there, he had been given the position of Associate Dean for Graduate Studies although he does not have credentials to carry out this job (no research, no graduate student advising, no recent publications, no recent grant writing...). His salary is way above his credentials. The acceptance of this position by him and any lack of concern by President Khator show that she has no ethical values when it comes to favoritism, nepotism, and quid pro quo (the same can be said for the dean and provost who approved this appointment). In fact, the spouse being in the administrative chain STILL violates those nepotism rules expressly changed to satisfy President Khator.

Given this, it is not surprising that President Khator is running the University based on these corrupt principles. Members of the Board of Regents are accomplices in these violations of very basic ethical rules.

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