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BACKGROUND
<br />In 1983, the TV30 Community Television organization was formalized as a public, non-
<br />profit corporation with a three member board of directors. Today, the organization is
<br />governed by a full-time Executive Director and a seven member board of directors, and
<br />employs a staff of fourteen. Over the past several years, and in particular the past two
<br />years, the demands of operating a community television station with quality
<br />programming have grown substantially, requiring an escalating amount of financial
<br />resources.
<br />DISCUSSION
<br />Financial Position
<br />Accordingly, keeping pace with changing technology and programming has
<br />necessitated a more sizable organization and budget. In Fiscal Year 2005-2006, the
<br />TV30 operating budget was $590,600; the FY 2006-2007 budget is $650,000
<br />(Attachment 1).
<br />Currently, 62% of the funding income for TV30 Community Television comes from the
<br />Cities of Dublin, Livermore, Pleasanton and San Ramon, provided via a franchise
<br />agreement with Comcast wherein a fee of $.50 per subscriber is allocated, or "passed-
<br />through," to TV30. In FY 2006-2007, this amounts to $403,668; Pleasanton's share is
<br />$119,412. A majority of the additional income is derived from dubbing and production
<br />services, underwriting by corporate sponsors and other donations.
<br />A majority of the expenses are shared among several key budget categories: wages,
<br />salaries and related taxes and insurance; equipment and supplies, including repairs and
<br />maintenance; overhead, including rent and insurance; professional services; and show
<br />sets. Significantly, in FY 2005-2006 the combination of total expenditures totaled
<br />$713,333 with wages, salaries and related payroll taxes and workers compensation
<br />insurance comprising almost $550,000 of that. Overall, at the end of FY 2005-2006, the
<br />total expenses exceeded the budgeted amount by $123,000; at the same time, income
<br />exceeded projected revenues by $71,000, resulting in a net deficit of $51,000 at the
<br />close of the fiscal year on June 30, 2006.
<br />Additionally, TV30 utilized a Line of Credit (LOC) to manage the uncertain timing of
<br />cash flow and ensure that payroll/overhead expenses could be paid as scheduled.
<br />However, based on the rising expenses paid throughout the year, the LOC was used as
<br />a primary source of cash and by the end of the fiscal year was drawn almost to its limit
<br />of $100,000. Immediately upon receipt of the funding from the Cities at the start of the
<br />new fiscal year (July 1, 2006) the LOC, plus accrued interest, was repaid in full. The
<br />effect of this payment coupled with the year-end deficit was to reduce the operating
<br />income for FY 2006-2007.
<br />A similar pattern was followed in FY 2006-2007. As of April 22, 2007, after meeting
<br />scheduled payroll/overhead expenses, TV30 had expended all cash on hand and had
<br />drawn the LOC to its $100,000 limit. The current fiscal year shortage is a result of the
<br />combination of a budget that showed a $9,000 deficit when adopted, a shortfall in
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