Troubled EOB’s radio station hit with funding violations

By Timothy Pratt

Wednesday, Oct. 19, 2005 | 7:31 a.m.

A public radio station owned by the Las Vegas Valley's largest nonprofit organization kept sloppy books and closed its affairs to the public, in apparent violation of rules tied to federal funds, according to an audit.

The Corporation for Public Broadcasting, or CPB, audited KCEP 88.1 FM with visits in July and December last year, and issued its report Sept. 30.

As a result of the alleged violations cited by the auditors, KCEP, owned by the Economic Opportunity Board, may lose future federal funding and may have to return some of its past funding, said Eben Peck, director of congressional affairs for the public broadcasting corporation.

The CPB is a private organization set up by the federal government to fund the nation's public radio and television stations.

KCEP overstated by nearly $300,000 how much it raised from listeners and misused $100,000 in federal grants in the years 2002-2003, according to the audit.

It also said that the station "had no written accounting policies or internal control procedures for station financial transactions."

Additionally, the audit noted, the station did not follow rules attached to the federal funds calling for an advisory board to act as a link between the community, the station and the parent organization's board.

"A less than full functioning CAB (community advisory board) did not ensure that the EOB ... hears and understands the community's concerns about station programming," the audit said.

The findings come less than three months after Jean Childs, EOB executive director, raised the idea of selling the station to help reduce a $2.3 million debt. The EOB was founded in 1964 to fight poverty in the valley.

Childs, EOB board chairman Claude Logan and vice chairman Lawrence Weekly did not return calls seeking comment. KCEP General Manager Lee Winston also would not comment on the audit.

The Corporation for Public Broadcasting's review of the station resulted partly from Sun reports beginning in March 2004 about the organization's financial, administrative and program troubles. There have been three reviews -- two federal and one state-ordered -- of the EOB's many programs in the last year.

Peck said that by Nov. 29 the CPB will decide whether to order the station to return any of its past funds and whether future funding will be affected.

He said the station still had not sent any required financial records to the CPB as of Tuesday.

The audit notes that the station's overstating of money raised from sources other than the federal government meant that the CPB also gave the station $23,322 more than it deserved.

The station also received grants totaling $104,560 to develop programs and sell them to other stations nationwide, but never sold them, according to the audit.

As a result, "hundreds of copies of these programs sit in files at the station," the audit said.

Station managers said they either were not aware of rules and regulations tied to the federal funds or "followed EOB policies and procedures" when it came to finances, according to the audit.

At the same time, EOB managers said they were unaware of requirements attached to the money. To make matters worse, the station's business manager and EOB's accountants were "not aware of each others' duties and responsibilities," the audit said.

As for the station's relationship to the public, the audit noted that a required community advisory board met only infrequently and did not advise the public of its meetings.

When corporation auditors visited the station in July 2004, the station and the EOB said they would shore up the advisory board and maintain records of its activities at the station. When auditors returned in December, the task still had not been completed.

Records showed that the advisory board met once in April 2002 and then again in June 2003. The next meeting, in December 2003, lasted 23 minutes.

Additionally, board members from the EOB stopped attending what few meetings there were in 2003.

The Sun found Tuesday that the station still had no records of the advisory board's members, meeting dates, meetings announcements or minutes.

The lack of a functioning advisory board showed that "the station didn't give ... listeners the opportunity to speak up -- they weren't looking out for the interests of their members," said Dianna Russo, board member of the Nevada Association of Nonprofit Organizations.

Timothy Pratt can be reached at 259-8828 or at [email protected].