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More than a dozen minority broadcasters sent a letter today urging U.S. Treasury Secretary Tim Geithner to provide financial assistance to this hard-hit industry to help weather the current economic and credit crisis. Key House leaders, led by Majority Whip Jim Clyburn (D-SC), Reps. Barney Frank (D-MA), Charlie Rangel (D-NY), Ed Towns (D-NY), Bennie Thompson (D-MS), Carolyn Maloney (D-NY), and Maxine Waters (D-CA), among others, wrote to Secretary Geithner last month to urge him to pay attention to the minority broadcasting industry, which has had difficulties continuing to access the capital markets.
“The recession and current credit crisis are having disastrous impacts in all economic sectors, but minority-owned broadcasters are close to becoming an extinct species,” the minority broadcasters stated in their letter to Geithner. “It is particularly concerning that the percentage of minority ownership in the broadcast industry is currently in the low single digits”¦ Financial foreclosure will roll back decades of work by the federal government to encourage more minority voices in the broadcasting industry.”
In June, the above-mentioned House of Representative members urged the Treasury department to take actions to support minority broadcasting with:
Enactment of an investment facility similar to the Auto Supplier Support Program to help restore credit flows to the broadcast sector; and Consideration to temporary bridge financing or government-backed loans (with warrants) until the economy improves.
The following minority broadcasters signed the letter to Secretary Geithner:
Amador S. Bustos
President and CEO
BUSTOS MEDIA, LLC
Walter F. Ulloa
Chief Executive Officer
Entravision Communications Corporation
Ronald L. Ulloa
KVMD Licensee Co., L.L.C.
Multicultural Broadcasting Companies
President, CEO, and Chairman of the Board
Spanish Broadcasting System
Pierre M. Sutton
Inner City Broadcasting Coalition
National Association of Black Owned Broadcasters
Maria De Leon
President and CEO
KXTD Gaytan Broadcasting Media, LLC
Lazer Broadcasting Corp.
President and CEO
Carter Broadcast Group, Inc.
Vice President and General Manager
Taxi Productions, Inc.
T&W Communications Inc.
Carol Moore Cutting
Cutting Edge Broadcasting Company
The July 12th letter to Secretary Geithner follows:
The Honorable Timothy Geithner
Secretary of the Treasury
1500 Pennsylvania Ave., NW
Washington, DC 20220
Dear Mr. Secretary:
The recession and current credit crisis are having disastrous impacts in all economic sectors, but minority-owned broadcasters are close to becoming an extinct species. Even in better economic times, minority broadcasters have historically had difficulties accessing the capital markets to make the meager gains achieved over a decade after the tidal wave of media consolidation. We write today to support and highlight a letter sent to you by House Majority Whip Jim Clyburn and a group of key House Committee Chairmen, including Reps. Barney Frank, Charlie Rangel, Ed Towns, Bennie Thompson, Carolyn Maloney, and Maxine Waters among others. The letter urged you to act to ensure minority-owned broadcasters are afforded similar consideration for federal assistance and investment given to the financial services and the domestic auto industry.
Unlike the auto business, the broadcasting has been healthy for many years and , upon a recovery, could shortly be restored to a path of growth with some temporary assistance. Given the global credit crisis, plummeting ad revenues, no-minority dictates by advertisers, and changes in Arbitron audience measurement, which have further deflated ad pricing, the short-term financial outlook for our broadcasting companies is not good. Many of us are now, or will soon be, weathering significant defaults of our credit facilities. Ironically, the loss of automobile advertising revenues, a substantial source of revenue for broadcast stations, is also weighing heavily on our businesses.
It is particularly concerning that the percentage of minority ownership in the broadcast industry is currently in the low single digits. What will happen to the communities we serve if this once in a lifetime financial crisis completely severs our access to capital and we lose our stations? The federal government for decades has advocated the importance of minority voices in the broadcast industry as a precursor to a vibrant democracy and a more inclusive society. Financial foreclosure will roll back decades of work by the federal government to encourage more minority voices in the broadcasting industry.
We are urging you to heed the recommendations from those key House leaders calling for:
The enactment of an investment facility similar to the Auto Supplier Support Program to help restore credit flows to the broadcast sector; and
Consideration be given to temporary bridge financing or government-backed loans (with warrants) until the economy improves.
We understand many businesses are seeking federal assistance. We don’t diminish the worthiness of those sectors. However, the primary source of news and entertainment for millions of minority communities in the U.S. comes primarily from minority-owned broadcasters. It would be unconscionable to have financial institutions that have accepted billions of federal government assistance to foreclose on these vital American voices. If the Treasury does not want to enact a direct assistance program, at least it should seriously demand that banking institutions receiving federal funds extend credit and be flexible in restructuring credit facilities to insure that healthy, commercially-viable minority broadcasters can weather this unprecedented, but temporary, financial storm.
We look forward to working with you, your staff, members of Congress, and our colleagues in the broadcasting industry to find ways to move forward during these difficult economic times. Thank you for your time.