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Kaitz May Decline Diller Contribution

9/24/2000 8:00 PM Eastern

Fresh off its annual fund-raising dinner and the coronation of new president Art Torres, The Walter Kaitz Foundation may reject the $6 million that USA Networks Inc. chairman Barry Diller offered to help recruit minorities into new-media jobs.

Last week, several members of the Kaitz board of trustees said they had already said no thanks to the donation, which Diller offered last February, because much of that cash would be earmarked to create jobs in broadcasting and not cable.

Diller proposed that the cable-exclusive Kaitz Foundation recruit and train women and minorities for positions at all levels of the broadcast industry. The proposal would have created internships for minorities at broadcast stations.

USA's USA Network and Sci Fi Channel are cable networks, but the company also owns broadcast stations in 12 markets, including Miami, Dallas and Atlanta.

Diller, who was out of the country and could not be reached, said last Friday in a statement through a spokesman. "We are surprised by this development. If that's what the board wants, we will find another organization to work with to achieve the goals of diversity within the workplace in broadcasting and new media."

The donation would have created a new-media fellowship program to train women and minorities for the Internet and new media positions.

But many Kaitz trustees apparently feel the 17-year-old foundation should work strictly for the advancement of diversity within cable-particularly since the foundation has been criticized for placing too few minorities in top-level cable jobs.

Cable is also trying to rebound from bad publicity generated by a "diversity report card" the National Association For the Advancement of Colored People released last April, which gave cable a "C" grade for diversity efforts.

The "big four" broadcast networks also caught heat from the NAACP for not casting minorities in starring roles in the 26 new shows slated for the 1999-2000 television season.

After that, some networks revised shows and added minorities to their casts.

"There's no reason why the Kaitz foundation should be a conduit for solving diversity within the broadcast industry when [cable] has its own diversity issues to deal with," one Kaitz trustee said last week.

But Torres said no decision to reject the offer has been made yet. He said he plans to talk to USA Network executives and the trustees before the final decision.

California Cable Television Association president and Kaitz founding director Spencer Kaitz also said the offer had not been rejected. In fact, he said Torres met with USA representatives last week to try to get new cable jobs added to the initiative.

However, Kaitz did concede that many trustees had "serious reservations" about the proposed broadcast-industry scholarship.

"Many trustees said that they were opposed to the Kaitz Foundation focusing on the broadcast industry as well as the cable industry," Kaitz said. "But Torres was given the latitude to meet with USA to discuss an acceptable solution to the concerns the trustees had."

A USA spokeswoman said only that the company is sincere about the fund's intent to increase diversity. "We feel that it benefits the cause of increasing diversity in the workplace," she said.

Spencer Kaitz said the idea of establishing a new-media fellowship program in cable was a goal the foundation would like to pursue, with or without Diller's cash.

"We would clearly like to go forward with a new-media plan for cable, which would meet a crying need to bring minorities to the growing new-media segments, including the Internet," Kaitz added.

The stalemate came as Kaitz officially introduced Torres to the industry at last week's Kaitz dinner.

Torres, a former state senator who spent 20 years in California state politics before losing an election for state insurance commissioner in 1994, said he's started to meet with industry leaders to discuss the foundation's future direction.

Lobbying for more input from national minority organizations, industry groups and former Kaitz alumni, Torres said he plans to meet with executives from every MSO in the near future to determine how best to implement the industry's diversity initiatives.

"I want to be judged on my efforts," Torres said. "The court of public opinion will determine the success of those efforts."

At the end of last Wednesday's dinner, Torres said that many have complained that little is done to achieve the foundation's goals in the time between the annual fund-raisers. He promised to see to it that diversity initiatives are kept on the front burner year-round.

Officials said last week's dinner took in a record $1.8 million dollars and drew 1,860 attendees.

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