By Stephen Magagnini | OBSERVER Editor-in-Chief
An extensive independent forensic examination of Capital Public Radio’s finances released Aug. 5 found $774,703 in unsupported payments between December 2021 and November 2023, according to the accounting firm CliftonLarsonAllen LLP. The examination blacked out names of alleged culprits while a sheriff’s office investigation was underway.
The 36-page examination was commissioned by Sacramento State University President Luke Wood and comes on the heels of an audit commissioned by former Sac State President Robert Nelsen in September 2023 that detailed a host of problems that jeopardized the station’s fiscal future.
For three of the largest contracts reviewed, “CLA determined that a CPR board member was either a founder of or a partner at the vendor who contracted with CapRadio may have presented a conflict of interest to the board members associated with each vendor. No discussions of potential conflicts of interest were identified in board minutes.”
The irregularities identified more than $700,000 in American Express credit card payments unsupported by any expense documents, and CapRadio board members who received and/or authorized the payments refused to answer CLA’s questions or explain what happened to the money, though one alleged offender said they were willing to discuss repayment. In October, 14 CapRadio board members resigned – including those at the center of the investigation who allegedly benefited from sweetheart contracts – citing “a failure of Sac State to inform and engage the board in a good faith effort to resolve CapRadio’s financial issues.” Four other board members also resigned.
Wood, whose many responsibilities include overseeing CapRadio, noted in a public statement, “While the report presents factual findings, it draws no definite conclusions. Additionally, some information has been redacted to avoid jeopardizing a related investigation by the Sacramento County Sheriff’s Office.”
Still, Wood expressed deep concerns about the report.
“It is absolutely unacceptable that any public organization – particularly one connected to our university – could be so poorly mismanaged,” he said. “The good news is that CapRadio has experienced a remarkable turnaround thanks to the dedication and hard work of so many across Sac State and CapRadio. Membership support is up 9%, average weekly news listenership has increased by 35%, new CapRadio board leadership is in place, and interim General Manager Frank Maranzino continues to champion a new day and a new culture for CapRadio with a new staff.”
Maranzino, in a news release issued by CapRadio management, said, “This has been a challenging journey for everyone at CapRadio – and everyone in the community who cares deeply about local public media. With the support of our community, CapRadio is in the midst of an inspiring turnaround story that includes stabilizing our finances and operations, improving and expanding audience services, and significantly growing listenership and engagement.”