Board Stamps KOCE ‘Sold’

After two years of twists and turns and bids and counteroffers worthy of a Wall Street merger, Coast Community College District trustees voted unanimously Wednesday night to sell KOCE-TV to a foundation of wealthy business and civic leaders in a deal that will preserve Orange County’s local PBS affiliate.

“I’m relieved and I’m elated,” said Bob Brown, president of the KOCE-TV Foundation. “Now, another chapter of the book starts.”

KOCE President Mel Rogers agreed: “For me and for everybody who lives in Orange County, it’s a terrific thing. Now everybody’s got to step up to the plate.”

Although the vote marks one of the final steps in the cash-strapped district’s search for a station buyer, the sale itself is not guaranteed.

The foundation has until June to come up with $10 million for operating costs and a down payment on the $32-million deal.

And a judge must still weigh in on a lawsuit filed by spurned bidder Daystar Television Network, the nation’s second-largest Christian broadcaster, which sued the district to block the sale. Daystar officials offered to buy Channel 50 for $25.1 million cash and maintain that they are the “highest responsible bidder.”

But their bid was rejected, as were others from religious and Spanish-language broadcasters. Trustees were under tremendous community pressure to keep the station a Public Broadcasting Service affiliate, which the foundation pledged to do.

Last week, in a last-minute effort to resolve its differences with the district, Daystar offered to drop its lawsuit and set aside part of its digital signal for around-the-clock PBS and local programming if it could buy the station.

Trustees did not acknowledge that offer Wednesday.

“What it comes down to is that you are being asked to approve the sale to an entity that isn’t financially solvent enough to come up with even the down payment,” Daystar attorney Richard Sherman told the board. “How can they borrow this much money and still make an investment in quality programming?”

Under the terms of the foundation’s $32-million deal, it must pay $8 million upfront, the remainder paid over 30 years with no interest and no payments for five years. The district later lowered the price by $4 million, money it said it would have had to pay back to the Corporation for Public Broadcasting and PBS if the station had been sold to a non-PBS bidder. The district credited the foundation an additional $2.5 million for district telecourses and promotional spots the station will air over seven years.

Critics of the terms have called it a “sweetheart deal” for the foundation. Experts have valued the deal at $12.5 million to $19.5 million in today’s dollars.

Foundation officials have not said exactly how they will pay for the station, and said they may take out a bank loan up to $10 million to cover the down payment and operating costs.

So far, they have raised about $4 million -- some of which has come from a few large donors.

Brown said the foundation was “well along” with the fundraising and that the trustees’ vote was “going to help significantly” in raising more money to buy the station.

With a huge smile, he pulled a $100,000 check from his pocket, the first payment required by the district once the two sides entered the purchase agreement.

Despite some financing questions, board members have said they are trusting the reputation and business stature of foundation members and supporters, who include Orange County’s elite. Among them are UC Irvine Chancellor Ralph J. Cicerone; former baseball commissioner and Los Angeles Olympics chief Peter Ueberroth; Henry Samueli, chairman of Broadcom Corp.; David Pyatt, chief executive of Allergan Inc.; and Dwight Decker, chief executive of Conexant Systems Inc.

Before casting his vote, Trustee Walter Howald acknowledged the task the foundation has before it.

But he said, “We trust you. We know you as part of the community.”