How $50 million in donations led KCET to split from PBS

In 2004, KCET-TV, the PBS affiliate in Los Angeles, enjoyed what seemed like a stroke of unimaginable good fortune. Like most public television stations, KCET struggled for funding, but in that year it began raking in generous grants for preschool programming that would eventually total $50 million. The gifts were the largest in the station's history, and the programs, "A Place of Our Own" and its Spanish-language companion, "Los Ninos en Su Casa," went on to win Peabody and local Emmy awards and later aired on PBS stations nationwide.

The oil giant BP had kicked in half the money, and in gratitude KCET bosses renamed their historic Sunset Boulevard soundstage BP Studios. But over the next few years, the golden egg hatched an albatross — one that directly led to KCET's surprising announcement earlier this month that it would exit PBS effective Jan. 1, thus leaving the nation's second-largest media market without a flagship public television station and marking the first defection of a major market station from the national network. As BP was grappling last summer with the Gulf of Mexico oil spill that badly tarnished its reputation, the unintended aftermath of its charitable giving had already begun to engulf PBS and the West Coast pillar of its national system. Under the network's complicated dues structure, which operates similar to a progressive tax, KCET would eventually see its dues to PBS soar more than 40%, from $4.9 million to nearly $7 million annually, in wake of the new grants.

The irony of the windfall is that even though it left the station flush with money, KCET could use none of it to settle its account with PBS. The grants came with the stipulation they could not be used for such administrative costs. And around the time the higher payments came due, KCET's major funding streams began drying up amid the tumbling national economy.