PBS ends employee loans flagged by CPB as Communications Act violations

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PBS has stopped allowing employees to take out interest-free loans for tuition and personal computers, a practice that CPB found violated the Communications Act.

A September CPB audit also found that PBS had failed to comply with open meeting laws and overstated indirect costs related to a grant for the first phase of public TV’s new interconnection system. In a Dec. 19 letter, CPB told PBS that all issues raised by the audit had been adequately addressed.

Until last year, PBS had been allowing employees to take out loans of up to $1,000 for tuition and up to $2,000 to buy personal computers. It canceled the tuition program in June and the computer program in July as CPB’s audit was underway. CPB recommended that PBS ensure the program had indeed been canceled and that all previously granted loans were repaid and closed.

“With PBS’ written confirmation that it has cancelled both programs, we are confident that the programs have been terminated,” CPB said in its December letter.

PBS did not answer questions from Current about how much money it had loaned and how many employees participated. A spokeswoman also did not confirm whether employees had repaid the money.

“As disclosed in the determination letter PBS has addressed each exception noted, requiring no further action,” PBS said in a statement.

CPB’s audit also found that PBS had not provided reasonable advance notice to the public of 30 of 79 open public meetings, including nine of 11 interconnection committee meetings. The report also said PBS did not adequately tell the public why two of 87 closed meetings were closed.

The audit recommended that PBS comply with requirements going forward and develop written procedures.

“PBS provided its written assurance that it would be compliant with these requirements going forward and had begun drafting written procedures,” the CPB letter said.

PBS was also found to have overstated indirect costs by more than $7,000 in its accounting of how it used interconnection grant funds. CPB granted PBS more than $22.5 million for phase one of the interconnection project. The audit found that PBS had reported budgeted costs of rent and utilities rather than actual amounts, leading to the overstatement. CPB allows reimbursement only for actual expenses.

CPB recommended PBS report the actual costs to correct the overstatement on its next financial report, which PBS did. To prevent future mistakes, it also said the funder should require grantees to disclose their methods for determining allocable costs in their grants. CPB’s Office of the Inspector General will review that recommendation.

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