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KOCE-TV's Role Is Central to Who Buys the Station, and Why

Christian broadcasters vie with a public partnership. Should the sale be for top dollar?

August 24, 2003|Jeff Gottlieb | Times Staff Writer

The impending sale of KOCE-TV Channel 50 has provoked passionate arguments for preserving Orange County's only public television station. But its tiny viewership, scanty local programming and red ink make some wonder if the debate is more about sentiment than reality.

The reach of Los Angeles-based KCET-TV Channel 28, which provides much of the same programming, competition from cable TV and the rise of the Internet as an alternative to televised college courses raise the question of whether Coast Community College District might be better off selling its Huntington Beach station to the highest bidder -- likely a Christian broadcaster -- rather than cutting a less lucrative deal to keep it in the PBS fold.

Robert Thompson, director of the Center for the Study of Popular Television at Syracuse University in New York, said there is often a nostalgic feeling for the Public Broadcasting Service, "especially among intellectuals and community leaders."

"What is this little PBS station doing that the big PBS affiliate isn't?" he asked. "If all it is doing is providing an opportunity to watch 'Sesame Street' at a different time, the market may not really need it."

The bidders for KOCE are four televangelist organizations, which offer up to $25 million, and a partnership between KCET and the KOCE-TV Foundation, which raises funds for the station. The latter bid, at $10 million, is the only one that would keep the station a PBS outlet.

Supporters of the joint bid say it must add more local programming to distinguish it from its sister station in Los Angeles. And, they say, to succeed it must continue to offer telecourses from the Coast Community College District in Costa Mesa, which owns the station, and market those classes elsewhere.

Al Jerome, president and chief executive of KCET, said that if his group acquires the station, local programming will increase. "If we were not interested in doing that, why would we be bidding?" he said. "We already cover Orange County."

The community college district funds $1.8 million of KOCE's $8-million annual budget, but some trustees said that could climb to $3 million in the next few years if the station isn't sold. The station also faces a bill of about $8.5 million to upgrade for digital broadcasting. About $3.5 million has been raised, mainly by the KOCE-TV Foundation.

Supporters of a top-dollar sale say the money could be better used for community college education at a time of shrinking classroom dollars.

"I simply do not feel the district can continue to take money that is intended for the education of students to make up for KOCE's financial losses," said Trustee George Brown.

The bidding also appears to have brought to the forefront the competition between the nation's two largest Christian broadcasters, the Trinity Broadcast Network of Costa Mesa and Daystar Television of Dallas. Each offered $25 million in cash.

In a surprise move last week, a TBN lawyer appeared to throw his support behind the Foundation-KCET group. Addressing trustees and 200 audience members at a college board meeting, John Casoria said the broadcast ministry "believes the joint bid by the foundation and KCET is the best responsible bid ... and offers to work with them in their effort to be the ultimate successful bidder."

Many assumed TBN was dropping out of the bidding, but that may not be the case. Brown said a district lawyer asked Casoria privately if TBN was pulling out of negotiations and was told it was not.

TBN officials did not return phone calls last week seeking clarification of their stance.

TBN's announcement prompted several people familiar with the negotiations to suggest that TBN, which already counts KTBN-TV Channel 40 in Santa Ana as part of its network, entered the bidding to block Daystar from gaining an Orange County outlet.

Once TBN saw the groundswell of public support for the Foundation-KCET bid, it decided that supporting that offer was cheaper than trying to outbid Daystar, observers said.

The Foundation-KCET bid could be getting help elsewhere. Fred Jager, president and chief executive officer of the Hunter Wise Financial Group, an investment banking firm in Newport Beach, was representing a group of CEOs who offered $10 million to buy the station and keep it as a PBS affiliate. His group dropped out of the bidding and has offered to guarantee bank loans for the Foundation-KCET offer.

The highest bid appears to have come from LeSEA Broadcasting Corp. of Indiana. The Christian broadcasting organization offered $10 million up front, $15 million in payments over time, and 20% of the station's annual earnings. The other bidder is Almavision Hispanic Network, a Spanish-language Christian broadcaster, which set its bid at $15 million to $25 million in cash. Elliott Evers, the district's broker, said he was not clear what conditions would trigger the higher price.

KCET brings to the partnership big plans but its own set of troubles, most of them having to do with money, which has caused the station to cancel some programs and halt plans for others.

KCET's Jerome said that combining the two stations would save money by consolidating business and fund-raising operations and allow them to promote each other.

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