Deadline Changed for Sale of KOCE
Responding to the threat of a lawsuit from a losing bidder for their TV station, the trustees for an Orange County community college district said Wednesday they would continue negotiating with a foundation that has promised to preserve the PBS-affiliation but set a March 10 deadline to complete the deal.
Milford Dahl, the attorney for the Coast Community College District, criticized the KOCE-TV Foundation, the winning bidder, for the drawn-out negotiations, saying it hadn’t taken the deadlines seriously.
“They haven’t gotten their act together,” he said.
Dahl said that if an agreement for KOCE-TV Channel 50 was not completed by March 10, the trustees would cut off talks with the foundation and decide on their next step. The original deadline to conclude the sale was Feb. 8.
Bob Brown, chairman of the foundation, could not be reached for comment.
An attorney for the Daystar Television Network, the second-largest Christian broadcaster in the country, has written three letters to the trustees saying the Dallas-based company would sue the district if it didn’t reverse course and sell the affiliate to his client.
Daystar offered $25.1 million cash for the station. District trustees rejected a sweetened offer of $40 million because it was submitted a day after the deadline.
The district agreed in October to sell Channel 50, which is carried on most cable systems in the Los Angeles area, to the KOCE-TV Foundation. The group has been transformed from the station’s fundraising arm into one controlled by some of Orange County’s most influential business executives.
The foundation’s winning offer was billed as $32 million when it was announced, with $8 million down and the rest to be paid over time with interest.
But after negotiations between the two sides, the deal changed substantially.
The district lowered the price by $4 million, money it said it would have to pay if the station had been sold to a non-PBS bidder.
The deal still includes the down payment, but the balance is to be paid over 30 years with no interest. No payments are due for five years.
Daystar says its offer is far more valuable in today’s dollars than the foundation’s. Outside experts agreed, saying the offer was worth $12.5 million to $19.5 million.
Lawyers not connected with the deal said that the changes made after the foundation’s bid was accepted were so extensive as to constitute a new bid and that a judge could overturn the deal.
District trustees argue that they sold the station to the “highest responsible bidder,” as the law requires. They have said that if they sold the station to a non-PBS bidder, the Corp. for Public Broadcasting and PBS would have sued the district to recover grants and equipment and some of KOCE’s most generous donors would have gone to court to have their money returned.
Some PBS supporters also threatened to tie up the broadcast license transfer for years before the Federal Communications Commission, costing the district more money.
The district, which is made up of Golden West, Orange Coast and Coastline colleges, considered KOCE a financial liability and felt it could use the money from the sale to help in the classroom.
Community pressure was mobilized to sell the station to the foundation, with many CEOs, politicians and leaders in education flocking to the cause.