MPT slashing staff, salaries, marketing as it faces shortfall

New `Wall Street Week' fails to attract sponsors

August 24, 2002|By David Folkenflik | David Folkenflik,SUN TELEVISION WRITER

Officials at Maryland Public Television are embarking on sweeping layoffs, across-the-board salary cuts, demotions of many executives and an elimination of all marketing efforts as they combat deep drops in revenue.

"We've had to [cut] personnel as a last resort," Robert J. Shuman, president and chief executive officer of MPT, said yesterday. "It's been difficult across the board."

MPT officials acknowledge that the budget problems have been compounded by their failure to draw any significant corporate sponsors for the station's signature program, Wall Street Week, after the ouster in spring of longtime anchor Louis Rukeyser.

The state broadcaster is predicting a $2.1 million revenue shortfall in meeting this fiscal year's budget of $37 million.

In recent years, officials at the national Public Broadcasting Service had become disenchanted with Rukeyser's approach on the air, saying his style was failing to attract new viewers. MPT officials argue that even had they kept Rukeyser, they would have lost the $6 million he generated in annual underwriting revenue because Wall Street Week would not have been nationally distributed by PBS in the fall.

In all, MPT officials say they expect $600,000 less in contributions from individual donors than they had initially projected. They now believe they will receive $1.5 million less in revenue from underwriters - corporate sponsors - than they had planned.

"I'm not going to tell you that Wall Street Week is not a part of it, because it is," said Larry D. Unger, executive vice president and chief financial and operating officer for MPT. "That's not the only part of it."

Unger and Shuman also said they expected new national sponsors to come on board for Wall Street Week by the beginning of the year.

MPT officials pointed to drops in corporate spending on advertising throughout the media and to widespread cutbacks at PBS' headquarters and at PBS stations in Chicago, Dallas, Houston, Kansas City and Philadelphia to illustrate that the situation here was not unique.

"We are seeing this past year and the year ahead as being difficult years for public television stations," said Wayne Godwin, executive vice president and chief operating officer for PBS. "Stations have had to do a number of painful things to right themselves financially. Maryland is not alone."

That offered little solace to staff members at MPT's Owings Mills headquarters, according to several employees there. Shuman announced the major changes in remarks spanning about 10 minutes, then left without taking questions. People gathered in small clutches in hallways, some choking back tears, as they discussed the revelations.

Among the steps taken by MPT, with the approval of its oversight board, the Maryland Public Broadcasting Commission:

Thirty-two of the state broadcasting system's 235 executive staff members - or 13.6 percent of the work force - will be laid off, many of them in the marketing and development departments. That includes four of MPT's 17 vice presidents.

According to people at MPT, those executives laid off include Jeff Hankin, the vice president for marketing and brand management; Everett Marshburn, vice president of news and community affairs; Ann Murray, vice president of development; and Robert J. Sestili, senior vice president for broadcasting and telecommunications.

Of those remaining executives at the level of vice president or above, nine will have to take significant demotions and a 10 percent pay cut to stay on.

Shuman's salary of $170,000 will be cut by 20 percent to $136,000; Unger's $142,000 annual pay will be reduced by 15 percent to approximately $120,000.

All remaining employees will face a 5 percent pay cut.

This summer, MPT quietly took smaller steps to trim costs, including cutting the travel budget in half, laying off four employees and freezing 13 vacant positions.

Shuman and Unger said locally produced programs, such as Direct Connection and ArtWorks, would continue without much change, although they might be executed on a slightly smaller budget. And they said MPT's required but expensive conversion to digital broadcasting would continue unabated.

Constance R. Caplan, the chairwoman of the Maryland Public Broadcasting Commission, said the oversight panel had been unanimous in ensuring that the pay cuts applied to executives, too. And, she said, the board concluded it was important to collapse the size of the upper ranks of MPT.

"It was top-heavy," Caplan said. "This was a good opportunity to restructure."

The state broadcaster is receiving some new subsidies for its activities this year. The board of the Maryland Public Television Foundation, a related state-chartered private charity set up to raise money for the broadcaster, voted earlier this month to sell bonds worth approximately $750,000 to help cover the projected shortfall. State allocations, which cover a large chunk of the agency's budget, are to remain constant.

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