An update on SaveWCAL

By Griff Wigley, on March 12, 2008, 1:39 pm

I got a Locally Grown Twitter this morning from Ruth Sylte, president of SaveWCAL, regarding a press release posted on their website titled SaveWCAL Wins a Victory for Public Radio Supporters and WCAL Donors.

I talked to Ruth briefly this afternoon and asked her if she’d chime in here to help us understand the latest developments. She’s agreed.

See previous blog posts/discussions from March, 2007 and June, 2007.

Civic Orgs, Colleges   SaveWCAL  

8 comments to An update on SaveWCAL

• 1
  Griff Wigley says:

  March 13, 2008 at 7:32 am

  Ruth, I guess I don’t understand.

  Why is the submitting of a Special Master report that has several things missing from it and which now means you have to wait for instructions from Judge Wolf considered “an important victory”?
• 2
  Ruth Sylte says:

  March 13, 2008 at 3:48 pm

  Well, Griff, important victories are not always large, flashy victories. SaveWCAL has now had a string of seemingly small, but important victories that have led us to this point.

  * It was a victory when SaveWCAL’s attorney, Michael McNabb, received the court’s permission to participate in the hearing about St. Olaf’s Petition and Amended Petition. The St. Olaf attorneys consistently fought the court’s decision at every single session of the hearing.
  * It was a victory when the court confirmed SaveWCAL’s standing as a representative of the WCAL donors. Neither St. Olaf nor the Minnesota Attorney General were happy about this.
  * It was a victory when the court ordered the Special Master investigation. SaveWCAL was the only party to suggest and request an investigation. Neither St. Olaf nor the Minnesota AG wanted it — each having their own reasons.

  Now the Report has been released and there is a lot of information finally in the public record that donors deserve to know. It has confirmed and/or brought to light information that SaveWCAL has — or has long suspected — concerning the handling of the WCAL charitable trust assets by St. Olaf College. That, too, is a victory for donors and for the public. (We will soon be addressing some of the Findings on our web site.)

  The single most important victory is that the Special Master recognizes that donors created a charitable trust that was WCAL (the AG recognizes this, too). This has consistently been SaveWCAL’s position at all times. There are state laws that govern how a trust (WCAL) must be handled by its trustee (St. Olaf). WCAL was not – as St. Olaf has claimed since 2004 – simply an asset that they could dispose of at will and collect the profits to use for their own chosen purposes. A trust’s assets, by law, must be used for the intent of the trust.

  Because WCAL is a charitable trust, this is a starting point for many questions regarding how the trust has been handled, what is the current state of the trust (types of current assets and their worth) and what is to be done with those assets under the current circumstances. These are some of the types of questions that guided the Special Master’s investigation.

  The reason this matter is in the courts is because the Petition/Amended Petition regarding the WCAL charitable trust assets was initiated and filed by St. Olaf College (not SaveWCAL), as is required of trustees by Minnesota state law when they want to make certain changes regarding those assets.

  This, of course, begs the question of why St. Olaf did not file a Petition with the court (as required) when it decided to sell the WCAL license, broadcasting tower, repeater station and other assets in 2004. This, of course, is not a part of the current proceedings at this point — but it is the proverbial “elephant in the room” around which all the parties are moving, even if they are not directly talking about it in court.

  So then we come to another victory: the finding that the trust is worth far more than the value that St. Olaf had represented to the court in their Petition and Amended Petition. Again, SaveWCAL has advocated exactly this position and we will continue to advocate for the inclusion of other assets as being a part of the trust as the hearing continues. As with any trust fund, WCAL donors have a right to expect that every last penny of the Trust is accounted for, insofar as possible.

  We expected that the Special Master’s Report might raise new questions that should or could be answered. This is not unusual. The presiding judge has the authority to accept or modify any of the Special Master’s findings before issuing his decision.

  It’s a good thing that SaveWCAL supporters are patient and persistent. These are positive attributes (some might also call it “Norwegian stubbornness”) when engaged in a long journey for justice and equity. The tens of thousands of donors, living and deceased, who gave millions of hard-earned dollars to build WCAL over the course of more than 82 years deserve no less from us.

  As for waiting for the Judge, this is a standard part of any legal proceeding and is perhaps what is meant by “The wheels of justice turn slowly…” We expect that our attorney will soon get a phone call from the court about setting a hearing date. And the wheels will turn again…
• 3
  Britt Ackerman says:

  March 13, 2008 at 4:41 pm

  Ruth: Is there a link somewhere for the actual PDF version of the report? And do you know if the case will be reassigned now that Judge Wolf is retired? Or will they bring him back as a retired judge to hear the rest of the case?
• 4
  Ruth Sylte says:

  March 13, 2008 at 10:59 pm

  Thanks for asking! We have a policy of providing as many documents as possible available to the general pubic.

  Document that were submitted to the Special Master as a part of his investigation are available at:
  http://savewcal.livejournal.com/104585.html

  The Rice Count District Court Special Master’s Report is available at:http://savewcal.livejournal.com/113270.html

  Judge Wolf, who is presiding over the case, has the authority to accept or modify the Findings of Fact, Recommended Conclusions of Law and Recommended Order. Judge Wolf will make the decision on all matters he has heard where all the evidence and arguments have been submitted by the parties. The St. Olaf Petition case will remain Judge Wolf’s case until it is complete.
• 5
  Matt Bowe says:

  March 15, 2008 at 11:53 pm

  As a former employee of WCAL, I have been following this issue closely. SaveWCAL is claiming a victory but this is not a victory.

  This whole situation has been highly unfortunate. Selling WCAL was the biggest mistake the college has made in my lifetime and it has hurt it’s students, alumni, faculty, staff, and the thousands who got a window into St. Olaf through WCAL’s unique and innovative programming. The college’s administration and Board of Regents was short sighted and the college’s continuing insistence on avoiding this discussion in the public domain is unacceptable. I also respect the work of SaveWCAL but find it’s vitriol towards the college to be counterproductive.

  In regards to the Special Master’s report. The Special Master does not recommend nullifying the sale, nor does he recommend establishing an endowment with the proceeds of the sale, only with certain funds that were specifically deemed to belong to WCAL when it existed as a going concern. The endowed funds for these activities, earmarked for “Core WCAL Activities” will likely generate only a couple hundred thousand dollars a year in income at best and St. Olaf would begin to have access to some of the principal in 2010.

  Ruth, on your blog, you specifically says that all FM licenses have been spoken for and no more are available. Therefore, no new WCAL station can be established unless it were on AM or in another medium.

  Result? If the Special Master’s recommendations are adopted, WCAL will not be saved.
• 6
  Ruth Sylte says:

  March 17, 2008 at 12:40 pm

  Matt, we appreciate the opportunity to correct misunderstandings about the Special Master’s decision and to bring more of this information to public attention.

  SaveWCAL’s goal has always been to preserve the WCAL trust in order to continue the mission and purposes of WCAL according to the intentions of donors and the requirements of Minnesota law.

  The hearing is not over and a final decision has not been handed down, so *no one* knows what the final outcome will be and both SaveWCAL and St. Olaf have appropriately declined to engage in public speculation about that outcome. While we view the Special Master’s report as one in a series of important victories that we hope will lead to a just outcome, no one is able to claim (as you seem to have) a “win” or “lose” end result for any of the parties at this time.

  This, however, does not change the facts:

  FACT: WCAL was not simply a radio station. WCAL always was and continues to be a charitable trust whose purpose was to support and maintain a radio station.

  When the sale of WCAL was announced in 2004, St. Olaf began to refer to WCAL as assets that it could dispose of at will and use for its own purposes. Then, in 2006, St. Olaf identified the “WCAL charitable trust” in their original Petition to the court — until SaveWCAL pointed out to the court the full implications of what this meant. Seven days later, St. Olaf College suddenly submitted an Amended Petition that completely removed St. Olaf’s previous assertions that the WCAL endowment funds belonged to a “charitable trust”.

  St. Olaf has now admitted to the court that it treated WCAL as a charitable trust until 2004 (and, by doing so, recognized its role and responsibility as trustee). The Attorney General has determined that WCAL is a trust. The Special Master confirms this.

  FACT: A trust’s assets, by law, must be used solely for the intent of the trust.

  St. Olaf claimed that, of the $1.36 million it said was in the WCAL endowment, it should only be required to maintain $500,000 restricted to “Core WCAL Activities.” The Special Master has found that the WCAL charitable trust actually has assets in excess of $5 million and has recommended that the use of those assets be restricted to “Core WCAL Activities”. The Special Master’s report clearly says to the college, “No, you will not be able to use the WCAL trust for your own purposes. You must honor the intent of the trust.”

  FACT: Minnesota state laws govern how a trustee must handle a trust. A trustee is not allowed, legally or morally, to use a trust or its proceeds for the trustee’s own, unrelated purposes. When a trustee acts in its own interests, it violates the primary duty of a trustee: to act in the interests of the beneficiaries.

  St. Olaf College may have held legal title to the WCAL trust but like any trustee St. Olaf had a fiduciary, legal and ethical obligation to use the assets for the beneficiaries (the WCAL donors and listeners). The College has made an express statement to the Court that it acted for its own interests when it sold trust assets so that it could use the proceeds for its own unrestricted purposes. In legal terms, that’s called “conversion”. In plain English, it is called theft. In fact, St. Olaf College wanted the money so much that it broke federal laws regarding public radio stations and state laws regarding charitable trusts in the process of selling the major assets of the trust.

  SaveWCAL’s primary and preferred goal has always been to restore the original intent of the trust: a radio station. As improbable and unlikely as that may seem to some at this point, it is nevertheless still within the realm of possibility, but SaveWCAL will not speculate on what may happen within that realm.

  But, in fact, St. Olaf College has the power to and could restore the station (and repair its shattered reputation) RIGHT NOW.

  It would need to petition the court, admit to its wrongdoing and ask the court to void the sale based on the illegal way it was handled. The purchase agreement with MPR clearly allows for this. While this would be temporarily embarrassing for the college, SaveWCAL believes that to do so would be an incredible witness of honesty and integrity to the St. Olaf community and the world. If the College chose this path, we assure you that SaveWCAL would wholeheartedly support the College and work to help it both restore the faith (and giving) of both the WCAL and St. Olaf donors as well as rebuild the College’s reputation in the larger community.

  Even if the presiding judge does not change anything in the Special Master’s report, St. Olaf may now find itself in the position of producing “WCAL Core Activities” without WCAL, which provided all these “core activities” and many other benefits to St. Olaf at little to no cost to the college – primarily due to decades of generosity by tens of thousands of WCAL donors!

  You’re right about one thing, Matt. The WCAL debacle is — and will continue to be for years to come — a clear “lose” for the college, even if they “win” some aspects of this particular case.

  It is not the whistle blower and/or messenger who is at fault here. Removing the veil of secrecy used by St. Olaf’s leadership to shroud their conduct in this matter has revealed facts that may sting. The truth is not always easy to hear. SaveWCAL has leveled strong and *accurate* criticism, but we have not used vitriol in our statements about the college. Anyone who reads our blog (http://SaveWCAL.LiveJournal.com.) can see this for her/himself.

  SaveWCAL has vigorously admonished the College’s leadership for, as you have pointed out, “the biggest mistake” in your lifetime. A timid opposition would not communicate the resolve of WCAL supporters to right the wrong nor would it honor the tens of thousands of donors, living and deceased, who gave millions of dollars to build the trust.

  Nonetheless, SaveWCAL as an organization has repeatedly affirmed it’s respect and affection for the College…and this is still most certainly true. Amen.
• 7
  Griff Wigley says:

  March 18, 2008 at 9:28 am

  In the Sat. Nfld News: Investigator releases WCAL report.
• 8
  Griff Wigley says:

  March 27, 2008 at 8:53 am

  Ruth was interviewed on KFAI last night.
  http://savewcal.livejournal.com/116829.html

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