The board of Duquesne University approved the sale of the university’s FCC licenses to operate 90.5 FM in Pittsburgh and soon after hired a consultant to help with the transaction. Duquesne University President Charles Dougherty says the value was set, “in the neighborhood of $10 million.” Dave Garland runs a media brokerage firm that was not hired by the university. He says that number is probable too high. He says multiplying the number of potential listeners by a dollar amount usually sets the value of noncommercial licenses. That number used to stand at $4.00 per potential listener. That would put the value of 90.5 FM’s 25-thousand watt signal at nearly $9 million dollars. However, Garland says the number has fallen in recent years along with the economy. Based on sales in 2007 the multiplier was $2.9, which puts the value of 90.5 FM around $6.5 million and Garland says it is probable lower than that today. However, he says every market is different and every sale is different. The most recent sale of a radio licenses in Pittsburgh is the sale of Sheridan Broadcasting’s WAMO AM, WAMO FM and WPGR AM in May of last year. Those three commercial licenses went for about $9 million to St. Joseph Missions. Garland says the presence of multiple bidders can also drive up a price. Duquesne President Charles Dougherty says he has multiple bidders but will only name Pittsburgh Public Media.
Pittsburgh Public Media is a non profit formed on January 14, 2010 expressly to purchase the 90.5 FM licenses from Duquesne and preserve its programming. Pittsburgh Public Media board chair Joe Kelly has enlisted the help of Public Radio Capital. The group was formed 10 years ago by a collection of public radio stations with the mission of preserving and expanding public radio stations across the country. Over the years managing director Marc Hand has worked with stations in markets as big as New York and Chicago and as small as Fort Wayne, Indiana. Hand says the first thing they had to do was start to build a business model to see if the station could survive on its own and what it could afford to pay for the licenses.
Duquesne University says the operating expenses for WDUQ last year was $3.6 million dollars and its operating revenues came in at $3 million dollars leaving the university to cover the difference. In a written response to a request for details on that funding gap the university said, “This support was in the form of donated facilities and administrative support from Duquesne. We provide the station space on campus that must be heated, cooled, cleaned and maintained. We also provide the station with administrative support such as accounting, payroll, benefit administration, etc.” Hand says he feels that can all be covered if the sale price is right.
Pittsburgh Public Media submitted a bid to the university last month which was rejected and Joe Kelly says a revised bid will be made this week. Kelly says the best-case scenario has the university accepting the new bid. He says there are two other options that are much less desirable to him. One would have the license being sold to an entity that would not continue to broadcast National Public Radio Programs and Jazz. The other involves the university delaying the sale of the station. Charles Dougherty says this does not need to be rushed. He says there is no financial pressure for the university to sell. The building that houses WDUQ is being torn down this fall to make way for a residence hall. Dougherty says that does not pose a deadline because a new space on campus has been identified for the station’s operations.
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