Run for Presidency, Scandals Blamed for Financial Problems : Pat Robertson Returns to Shaken Empire

There was a time, not so long ago, when the Christian Broadcasting Network seemed as solid as the imposing brick buildings that evangelist Pat Robertson erected here as the headquarters of his worldwide ministry and media empire.

Those were the days when the network’s income approached $200 million a year, enough to launch a university on a 680-acre site in this seaside city and pay for the television time that transformed Robertson from an unknown seminary graduate into a household name across the country.

But that was before a number of factors--chiefly Robertson’s decision to relinquish management of the network to pursue his presidential ambitions and the sexual and financial scandals that tarred religious broadcasting--combined to dry up CBN’s revenue and shake the network to its foundation.

Bone-Deep Budget Cuts

The communications conglomerate was forced to make bone-deep budget cuts, and more layoffs and cuts are expected soon. At the same time that the corporate enterprise was responding to disastrous declines in revenue, the spiritual mission lost not only its founder but also its sense of direction and purpose, according to some ardent supporters.

To turn around some of the revenue figures and to assist his son, Tim, who succeeded him as head of the network, Robertson returned this week to CBN as chief executive officer and began doing limited “news analysis” segments. Robertson formally suspended his campaign for the GOP nomination Monday. Robertson had previously ruled out his return to CBN--part of his political strategy to shed his evangelist image and be identified as an “ex-religious broadcaster.”

CBN’s predicament is so dire today that some Robertson associates say this summer season will probably make or break the ministry. “By fall, we’ve got to be on our way up,” said CBN University President Bob G. Slosser, who sits on the network’s board of directors.

In interviews during the last month, CBN executives and employees described a ministry that survived the shocks of the last year on a combination of faith and a newly found appreciation for the bottom line. A total of 645 employees, from vice presidents to groundskeepers, were laid off in a 6-month period last year, salaries were frozen, and plans for new capital construction and long-awaited CBN university programs were shelved.

An undisclosed number of employees were laid off this week. Within a month, CBN will announce other budget cuts, Pat Robertson said in an interview. The options being considered include charging people 50 cents for what currently are free telephone calls to CBN support staff and volunteers around the country and pruning $3-million worth of marginal television affiliates, Robertson said.

“The problem is that the company has an overhead structure that was set up to accommodate a much larger enterprise,” Robertson said. “There are still some cuts that can be made.”

From Robertson on down to those in CBN outposts, the faithful said they have no doubt that CBN will survive, albeit in a much leaner form. The organization reaches a potential international audience of 237 million people through its “700 Club” show alone.

“I would not be truthful if I said my faith was strong all the way,” said Kenneth Overman, director of the CBN Center in Fairfax County, Va. But, he added, “It’s just fine (because) God is in control. Where there’s faith, there comes an awful lot of hope.”

However, others, including some who say they wish the best for CBN, suggested that many of the ministry’s current financial woes were preventable, adding that as the network tried to cope with the absence of Robertson, its driving force, it lost the spark that had captivated so many viewers.

Impact Underestimated

“I’m not inspired by the product I see,” said Norman Berman, a former CBN vice president who worked at the network for nearly 10 years. “I don’t see them doing the things they need to do to recapture the people who used to watch Pat’s show.”

Robertson acknowledged that he and others at CBN underestimated the impact of his leaving CBN last year to campaign full time for the Republican presidential nomination. CBN’s data indicates that Robertson’s departure as “700 Club” host hurt the network most among its coveted “upper income” viewers, those paid at least $30,000 annually in salaries.

While the impending cuts will cheer no one at CBN, they almost certainly will not be as bad as those made last year as revelations unfolded about the excesses of Jim and Tammy Bakker and other evangelists. Those scandals alienated millions of potential donors. Worse yet, CBN’s wealthiest givers cut donations after last year’s sharp drop in oil prices and the October stock market crash.

The prolonged cash drain shocked the network. Contributions, which make up 73% of the network’s annual revenue, totaling more than $135 million in 1986-87, tumbled about 33%, according to CBN officials. As the fiscal crisis set in, the network’s top brass made it clear that virtually no component of the television conglomerate was immune to cuts.

No Pay Raises in Store

CBN University professors, some of whom had gone without a pay raise in the previous year, were told there would be no salary increase in the new academic year. One CBN television studio, part of a state-of-the-art TV production complex, was forced to go dark. The network’s toll-free line, an important part of CBN’s outreach program and fund raising, was cut off to save about $5.5 million annually.

The human toll was devastating, ministry officials said. As part of a $25-million budget cut in June, 500 regular and part-time employees were laid off, bringing the CBN payroll from about 2,100 workers to 1,634. Then in November came another $9 million cut and the layoff of 145 more employees.

At outlying CBN offices, the ripple effect of cuts ordered by headquarters in Virginia Beach slowed the day-to-day routine of the ministry to a crawl. Overman of the Northern Virginia center said he had to let go 15 workers who staffed the center’s phone bank. At the same time, funding for Operation Blessing, a major CBN program that dispenses food, blankets and other goods to the needy, fell from $15,000 a month to $6,000, Overman said.

“It became rather quiet around here,” said Overman, 41, who joined CBN in the fall of 1985. “The overall ministry was definitely hurt.”

CBN workers have tried to show a brave face during the last year, describing the fiscal calamities as a kind of purification, an experience that bonded the survivors together and one that will ultimately do the network some good.

“These people have just amazed me,” said Tom Victor, the CBN vice president whose ministry division oversees the Northern Virginia center and 40 other domestic outreach locations. Although his staff shrank from 400 to 303, Victor said, those who stayed “now have a much more focused approach,” concentrating on new endeavors to recruit even more volunteers to meet the demand for CBN’s many charitable services.

Few Bright Spots

There are a few bright spots on the financial horizon. The CBN Cable Network, which offers such old television favorites as “Father Knows Best,” “The Flying Nun” and Westerns, continues to make a profit ($4 million last year), though Robertson said it probably will be spun off from the parent company to satisfy an Internal Revenue Service demand that the nonprofit CBN curtail some of its most profitable ventures.

CBN Radio, launched at the very time contributions sagged, has been picked up by 120 stations around the country and offers commentary, features and music programming. And CBN’s publishing arm has developed products, such as videotapes of Bible stories and literacy programs, that have sold well overseas.

However, CBN is by no means out of the woods. A January telethon, for instance, raised $20 million, down from more than $30 million last year. Enrollment in this fall’s classes at CBN University has declined, and that institution’s budget is $2 million smaller than it was last year. Contributions have picked up slightly, but not nearly as fast as many at CBN would like, officials said.

Many outside experts say that it will take at least three more months for CBN to bottom out and that eventually the network will dig itself out of its many problems. “CBN has been well managed, and save for that fact, they’d be in far worse shape than they are,” said Jeffrey Hadden, a University of Virginia professor who has closely watched Robertson and other religious broadcasters.

As the shakeout in electronic ministries continues, “some will not make it, but CBN will,” Hadden said.

Robertson, an eternal optimist about his network, insists that the persistent cash crisis is nothing compared to the “life and death” struggle he had when scrambling to pay rent and other bills in the early days of CBN.