Air America Faces a Cash Crunch, Its Star Host Says

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

The New York Sun

Air America Radio, the liberal talk-show network, is fighting off bankruptcy, the face of the network, Al Franken, told The New York Sun yesterday.

The comedian and liberal author said the financial situation is dire enough that he has not been paid recently.

“We have a cash flow problem. That’s what I know,” Mr. Franken told the Sun. “No cash has been flowing to me. That’s the first inkling I got of a cash flow problem.”

Mr. Franken reportedly earns a base salary of about $2 million a year from the radio network.

He said he found out he was not being paid about a week ago, and that he has had some recent conversations with management over the financial problems.

“I know that they are trying to get it together to weather the storm like we have in the past. Hopefully we will,” Mr. Franken said.

Financial problems have dogged the start-up radio network since its launch in March 2004.

On September 1, Air America Radio switched its New York flagship station from WLIB on 1190 AM to a station with a much weaker signal, 1600 AM on WWRL-AM. As a part of that move, the radio network laid off as many as nine employees, a spokeswoman for Air America, Jaime Horn, said.

Ms. Horn said in a statement yesterday: “No decision has been taken to make any filing of any kind.”

She said: “If Air America had filed for bankruptcy every time someone rumored it to be doing so, we would have ceased to exist long ago; it may be frustrating to some that this hasn’t happened.”

Still, the statement left open the possibility that some kind of shake-up or restructuring could occur soon. Both liberal and conservative Web logs reported the network’s most recent financial woes yesterday. A liberal Web log, Think Progress, reported that the network is expected to file for bankruptcy tomorrow. The author of the conservative web log the Radio Equalizer, Brian Maloney, wrote that Air America’s assets could soon be sold off.

One of the network’s founders, Carl Ginsburg, recently resigned, and a former CEO, Danny Goldberg, who is currently a vice chairman of the network, has said he will leave at the end of the year.

Recently, a host of an Air America talk show, actress Janeane Garofalo, left the network to pursue other professional opportunities. The move was supported by the network, a spokeswoman said. The Web log of Ms. Garofalo’s former show, “The Majority Report,” now hosted by Sam Seder, said yesterday that if the network does file for bankruptcy, the radio line-up could continue in the same fashion during a reorganization.

“In the final analysis, air america is not the last word in progressive talk but only the beginning of a new genre of talk radio,” the Web log said.

Last year, Air America was involved in a scandal involving a boys and girls club based in Coop City in the Bronx, prompting a probe by the city’s Department of Investigation and the office of state attorney general, Eliot Spitzer. The probe is still under way.

While he was helping launch the radio network, a former director of Air America, Evan Montvel Cohen, simultaneously served as development director for the Gloria Wise Boys & Girls Club. Mr. Cohen told the Sun that he arranged the transfer of $875,000 from the club to help the start-up radio network. He could end up facing criminal charges for arranging the transfer.

Ownership of Air America has since changed hands; the current owner, Piquant LLC, deposited $875,000 into an attorney-controlled escrow account to be released to Gloria Wise when the DOI completes its investigation and authorizes payment. Gloria Wise was badly damaged by the scandal, including losing its affiliation with Boys & Girls Club of America.

Yesterday, a spokeswoman for the DOI, Emily Gest, said the transfer has not yet occurred. “DOI expects Air America to uphold its commitment to repay victims of the scheme,” Ms. Gest said.

The New York Sun

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