Nobody wants it.

Air America Stiffs Al Franken

THAT'S AL, FOLKS Franken wants a paycheckIs Air America Radio going belly
up? The troubled left-leaning network is dismissing yesterday's report by
Think Progress that it plans to file for bankruptcy on Friday. But you know
things must be bad when even your top star can't get paid.
"I don't know if that's true or not," Al Franken told Radar late Wednesday,
when asked about the bankruptcy report. "We do know that there have been
cash-flow problems. I haven't been paid in a while. Like, there's no cash
flowing to me."

It's not the first time Franken has gone without a salary. Air America ran
out of money promptly after it launched in 2004, after disgraced former
chairman Evan Cohen inflated the amount of money he had raised to fund the
network. The debacle nearly killed the network in its infancy, and led to a
legendary incident in which Cohen reportedly sent an executive to Franken's
apartment to hand-deliver an envelope purportedly containing all of his back
pay. It was empty.

Since then, Air America has seen a litany of troubles, executive departures,
talent shuffles, and lawsuits. Six months ago, the network was booted from
its flagship station in New York City, WLIB, to a much weaker signal that
doesn't cover the entire city, and it laid off five staffers on September
11, according to the New York Post.

Franken isn't the only person that Air America is in hock to. Last year, the
network settled a multi-million-dollar lawsuit from Multicultural
Broadcasting, the owner of its Chicago and Los Angeles stations, for its
failure to pay for rented airtime. But according to Multicultural's
attorney, Randy Mastro, the network still hasn't paid up. "It involved a
structured settlement over time," Mastro says. "There is additional money
owed. If it's true [that they're filing for bankruptcy], we'll have to do
something about that."

And then there's the matter of the $875,000 the network owes to the Gloria
Wise Boys and Girls Club. As has been extensively covered on right-wing
blogs, Cohen convinced the nonprofit club-he sat on the board-to OK a
massive interest-free loan to keep the network afloat in its early days.
When news of the arrangement broke-liberal radio net steals from poor
kids!-Air America agreed to repay the loan in full, and the New York City
Department of Investigation started looking into the propriety of the
transaction.

Air America says the money is in an escrow account controlled by its
lawyers, who have been instructed by the DOI to wait until their
investigation is complete before transferring it back to the Boys and Girls
Club. But neither Jack Kiley, an attorney for the Boys and Girls Club, nor
Emily Gest, a spokeswoman for the DOI, could confirm that the escrow account
actually exists. Asked whether she was certain that Air America had indeed
deposited the funds in an escrow account, Gest would only say, "The
Department of Investigation expects Air America to uphold its commitments to
repay the victims of this scheme." Kiley says that a small portion of the
loan has been repaid, and he expects that the remainder is forthcoming.

Janeane Garofalo, who quit her job as co-host of the network's evening show
Majority Report in July, says her paychecks had been arriving on-time, and
that her departure had nothing to do with the network's finances. But she
didn't have kind words for the "radio suits"-guys like interim CEO Jim
Wiggett, network president Gary Krantz, and president of programming Jon
Sinton-who have been running the place into the ground.

"They've been making bad decisions since the day I got there," Garofalo
says. The network's staff, Garofalo says, is tireless and committed to the
cause of progressive radio. "And then you have a handful of business people
with no politics whatsoever. I can't fathom the decisions they make."

Tom Embrescia, a former radio entrepreneur and Air America board member,
says no specific bankruptcy proposals have been presented to the board. But
he's circumspect about his faith in the current management. "They're losing
money," he says. "That's common knowledge. I think all along they've had
some questions about what they're doing. They're always talking about
raising more money, and there's always been times when [chairman of the
board and Real Networks founder] Rob Glaser has come in to save the day." As
for why Air America can't seem to turn a profit, Embrescia says it may have
been a mistake to launch an entire left-wing talk radio network in one shot.
"Maybe it should have been one or two programs," he says.

Norman Wain, a Cleveland-based former radio executive and investor in Air
America, says he hadn't heard about any financial difficulties. "I know
nothing about it," he says. "They don't communicate with investors very
well. They only come to us when they're looking for more money." The last
time that happened, he says, was "three or four months ago."

If bankruptcy is imminent, the timing couldn't be worse for Franken: His new
movie, Al Franken: God Spoke, opens today in New York. In a statement, an
Air America spokeswoman said "no decision has been taken to make any filing
of any kind."

By John Cook   09/13/06 4:15 PM